Interview: Nilofer Merchant, Author of 11 Rules for Creating Value in the #SocialEra

I’ve known Nilofer Merchant since 2009 when I met her at the TED conference in Long Beach, California. I knew of  her before then, but little did I know how amazingly warm and friendly she would be. I knew her as this mogul of an agency founder who worked with the big time. Turns out, she is not only smart and accomplished, but she is also one of the warmest people I’ve met. Over the years, we’ve grown to be good friends and Nilofer has been my mentor and advisor on both professional and personal issues.

I’m particularly excited about her new book, 11 Rules for Creating Value in the #SocialEra, where she applies many years of experience teaching the 600 lb gorillas to be much more social and agile. I highly recommend picking up the book – it’s a fun, easy read and packed full of great insights – but I’m also honored that Nilofer agreed to answer a few extra questions I had.

1. Give a little of your background just in case my readers don’t know how rich it is.

I’ve worked for major companies like Apple, and ran a big division Autodesk, and startups in the early days of the Web (Golive/ later bought by Adobe).As a high-tech executive who hated internal corporate politics, I ended up starting my own consulting practice, which quickly grew up to be the strategy team of choice for  Logitech, Symantec, HP, Yahoo, VMWare, and many others. We helped them do new product strategies, enter new markets, defend against competitors, and optimize revenues. And, I’m probably one of 5 people on the planet who can say they’ve fought a competitive battle against Microsoft and won,which I did for  Symantec’s Anti-Virus $2.1B annual business. I’ve has personally launched more than 100 products, netting $18B in sales, mostly in Europe and US markets.  Today I serve on corporate boards for both public and private companies.

I think that makes me a business grown-up.

2. How did you decide to write #socialera?

I’m looking at joining a few more corporate boards, and so I’ve been sitting in board meeting and realizing that social is viewed as this thing you do with marketing rather than a way to think about organizational design. All these companies are struggling to be fast / fluid / flexible and yet they keep doing things that are slow / bureaucratic / and self-serving. As I studied the companies and situations, what I realized was that these are not bad people but they’ve only been taught the stuff of Porter’s Value Chains and then they’re trying to fit in newer ideas into that existing framework. They are trying to tweak their way into the future. And so one day I was doing a follow-up note on a topic and wanted to share this perspective by linking to a few known thinkers… but none of them had written something about how Social could be the backbone of the business. So I did first as a 5-part series on Harvard Business Review’s blog and now this ebook. There’s too much at risk in all these organizations if we don’t reimagine our organizations.

3. I loved the obituary for old school marketing. Do you really think it’s deceased or does it merely require a heart transplant? ;)

The obituary was meant to be provocative. To point out 5 specific beliefs that are firmly held as true, when they don’t apply as broadly anymore. So no. I don’t think it’s deceased. But I do think we need to learn to adapt. I wrote about this in the book. That we need to learn to think and learn and unlearn what doesn’t work:

“Adaptability is central to how organizations and people thrive in the social era. In psychological language, the key to adaptability and personal growth is resilience. In biology, the equivalent term for adaptive skills is plasticity. In financial language, the term we might have used in the industrial era was liquidity, because it could measure how an organization was able to withstand the unexpected. In the Social Era, the term to use is flexibility. Our goal is to learn our way into the future. Instead of viewing strategy as a set end point, it becomes a horizon to aim for. Instead of asking employees to each simply man their own oar, we must encourage their capacity to navigate, to tack and adapt as conditions shift. Instead of perfection and getting it right the first time, innovation can be continuous, and core rather than episodic.”

 4. You have something many social marketing consultants don’t have: experience with the ‘gorilla’ sized companies for many years. What are the core lessons from #socialera aimed at these giants who, as we know, aren’t inherently social?

There are 3:

One is that scale shifts from “big” to “with”.  You can create value through openness. Here’s an example from technology. Most organizations used to do their own development. Within the last ten years, open source software went from being a programming lark that organizations like Oracle or Microsoft made fun of to one that is the default choice for corporations from IBM to Google. Even Microsoft has found a way to open its Xbox Kinect controller so it can be a platform for artists and roboticists. As a result, the platform contributions have far surpassed what Microsoft could have created alone. And let’s be clear: Openness is more than “open source” – it is a way to engage ideas. The value created by platforms that enable many people to contribute ideas can surpass the value created by organizations trying to control each piece. What is created by individuals (without pre-approval, or vetting, or even by defining the exact outcome) can both surprise and delight. Instead of companies trying to achieve scale by all by themselves, scale can be achieved through and  with community.

Second, consumers can be a source of value creation. Fifteen years ago, The Cluetrain Manifesto  was prescient when it taught us that markets are conversations, and that was a great starting point. “Conversations” can go deeper if an organization allows them to become central to how you work, rather than leaving them on the perimeter. And Tara, your own book gave us many solid examples of companies doing just that. But how many companies have figured out how to shift from old-school “supply chain management” to the more modern idea of capturing insights and integrating them directly into product design, distribution, and delivery? Because that’s the point. Instead of a buyer at the end of a value chain, more and more companies are embracing consumers as “co-creation” partners in their innovation practices. This collaborative model fundamentally shares power, improves speed, and shifts the value equation.

Third, Purpose can become an alignment system. When companies think of social media, they hope to get consumers to “like” them or “fan” them, as if that increased connection is meaningful. Again, that captures the marketing aspect, but completely misses the strategic point. The social object that unites people isn’t a company or a product; the social object that most unites people is a shared value or purpose. When consumers “love” Apple, they are saying they love great design and the shared idea that “thinking differently” is valuable. By “loving” Firefox, the Web community is saying that it believes an open Web browser is valuable to the world. By loving TEDx, a volunteer army of people is saying it believes that smart ideas that get people to think more about their world is a cause worth putting energy into.Purpose aligns and scales in a way that “command and control” telling people to do certain does not.

5. When you look around you and apply the #socialera lens, what is your favorite example of a company that gets it? And why?

I have a ton of examples throughout the book of companies that get it and companies that don’t. There is no one company I could find that is doing Social as a backbone — across all parts of their business, so i got a chance to highlight the “best of” across industries. But let me share one example of an idea that is changing lives and embodies the #SocialEra.

A website called PatientsLikeMe was cofounded about ten years ago by three MIT engineers. The brother of one and friend of the others had been diagnosed with ALS (Lou Gehrig’s disease) at the age of twenty-nine. As they began searching worldwide for ideas that would extend and improve the person’s life, they built a health data-sharing platform that allowed patients to manage their own conditions, change the way industry conducts research, and improved care. Unlike most health-care policies that worry about privacy, PatientsLikeMe focuses on openness. They believed that sharing experiences and outcomes is good. Why? Because when patients share real-world data, collaboration on a global scale becomes possible. New treatments become possible. Most importantly, change becomes possible. And ultimately this leads to the greater purpose: speeding up the pace of research and fixing a broken health-care system.

In this way, PatientsLikeMe shows us another lesson about the SocialEra. When you collaborate, you can make something better for everyone. And, the real key is that an open approach can get to new and better ideas—and a lot more of them—faster, as a system opens up. #socialera is about allowing anyone, anywhere to contribute. Not the people you think “can” or even the people that you think “should,” but from the abundance and diversity of many people’s experiences. As each person stands in a place only she sees, she can bring her onlyness to solve whatever problem she sees closest to her.

This is the hallmark of the #socialera: it strengthens not just the direct act, but the indirect acts of community, of speed to create new solutions, and certainly of new solutions to old problems. Those add up to the reasons why I think this is important — for organizations of all sizes.

6. Speaking of companies who get it, I’ve been floored by the rise of Oreo in the social space. They are now the #3 most loved brand online – even after their controversial support of the LGBT community with their Gay Pride Oreo. Applying #socialera to their success, could you give your assessment of this brazen food brand?

I love that as a marketing example They are building real relationships, not just transactions. They are allowing customers to co-create. And in being real and vulnerable, they are getting commitment in the process. Most marketing language talks about “winning the customer” as if it’s a win-lose proposition but Oreo is showing that like any relationship, co-creation is a different level of commitment for both the product and the brand.

7. You and I are both fans of fashion and, more recently, I’ve seen these gorillas making bold moves into the Social Era. What are some of the examples of your favorite fashion gorillas that have ‘gone gazelle’? 

Oh, by far, Burberry is doing amazing things. A few seasons ago, they invented the category of tweet walk, where consumers (not just the fashionistas and editorial powerhouses of Fashion Week) to give immediate feedback on the line. This week, they opened up a digitally integrated store in London that uses the combined power of online and instore experiences. And today, customers can customize products so that the killer jacket you want is one that very few people will have. Which, as you know, Tara is worth something. We all want to exercise our own style muscle. And a brand that can do that with you is going to use technology and social behavior to feed its bottom line.

8. Of all of the rules, which ones are your favorites and why?

Oh, you ask such hard questions! Well, the people who have read this book keep highlighting this one sentence: “Not everyone will, but anyone can”. And I think that’s the central idea. The foundational element of all value creation starts with celebrating each human and, more specifically, something I’ve termed onlyness. Onlyness is that thing that only one particular person can bring to a situation. It includes the skills, passions, and purpose of each human. Onlyness is fundamentally about honoring each person, first as we view ourselves and second as we are valued. Each of us is standing in a spot that no one else occupies. That unique point of view is born of our accumulated experience, perspective, and vision. Some of those experiences are not as “perfect” as we might want, but even those experiences are a source of ideas and creativity. Without this tenet of celebrating onlyness, we allow ourselves to be simply cogs in a machine—dispensable and undervalued.The organizations that know how to take advantage of that will thrive. And so will humans.

 9. Anything else to add?

Well, one thing. I could just as easily called the book “the unrules”. While I’ve drawn plenty of distinctions to give language to the working notions of the Social Era rules, the key is to figure out how to create value in a demanding, ever-changing market. Don’t assume any set of rules is fully baked. Accept that each of our jobs is to stay alert to what happens next to figure out what assumptions need to be tuned. Listen, learn, adapt.These are the skills we must all own.

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Categories: community, featured, social capital

Author:Tara Hunt

Strategist. Researcher. Interdisciplinarian. Founder, Lime Foundry + Buyosphere. Author, The Whuffie Factor. Speaker. Mother. Karaoke lover.

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