This morning I had breakfast with a gentleman named Karl who is a thought leader in organizational development and human capital and an all around good fellow.  I’ve reconstructed our in this blog post because it was very insightful.

Karl:  Talked to a FT 500 company yesterday.  They are proud they have no turn-over.

Me:  So?

Karl:  I told them this was a very bad thing for them.  Very, very bad.

Me:  Why?

Karl:  Because when the economy improves the artificially retained people will leave en-mass.  You see, they are staying because of healthcare and a paycheck.  A huge chunk of their employees hate their jobs and hate their employer.  If the government ever gets to some form of universal coverage…and they will, even more people will leave.  Imagine, 20% of your work force, both customer facing and internal facing leaving within one year.  The organizational stress will be beyond belief.

Me:  Wow.

Karl:  Yeah, and what’s worse, this company and lots of others just like it will go from being a market front runner to a market laggard because of one key thing.

Me:  What’s that?

Karl:  They have very little in the way of enterprise wide customer engagement tools that are solid and embedded into the organization.  That’s a fancy way of saying they haven’t figured out how to engage customers using both community and social marketing tools.  Note, I didn’t say social media.

Me:   Hmmm.  Tell me more.

Karl:  Well, when the collapse comes, and it will, the business won’t have an external support structure.  You see feedback and advocacy is critical to a company not becoming a commodity.  Plus they are totally measuring the wrong stuff!Companies that behave in this manner are not flat.  If they did, they’d be flat.  Size doesn’t matter, culture and focus does.  Flat organizations perform at higher levels. Period.  Let me demonstrate.

Karl takes some of the crumbs from his bagel and scatters them on the floor underneath the table.

Karl:  Hey Mike!  (the owner of the little place we met), your floor is dirty!  Mike comes over.

Mike:  Hi Karl (Karl lives in the neighborhood and goes there a lot).  What do you need?

Karl:   Floor is dirty Mike.  Thought you’d like to know.  One other thing.  Did anybody ever tell you the new menu is too hard to read?  Oh, and the new coffee blend is terrific. To die for. Can I get a pound?

Mike:  Sorry about the floor (someone comes over and sweeps up the crumbs while we are talking).  Yeah, a couple of other people told us about the menu.  Josie is picking up a new one at Signworks this afternoon.  Thanks about the coffee!  You know, I never thought about selling it.  Just serving it.  Think it would catch on?

Karl:   Totally.  Give me three pounds.  I’ll give a few away as gifts and tell a couple of people.  I bet it catches on.  I even have a name idea for you.  By the way, how much do you pay for your straws?  You use a lot of straws don’t you?

Mike:  Thanks for the idea.  Umm, no idea what I pay for straws.    Yeah, we do use a lot of them but nobody has ever asked me about my straws…

Mike leaves and Karl says to me, “See flatness.  Satisfied customer. Instant feedback and results. How many areas did we cover?”

Me:  Let’s see…floor, sign, coffee, straws.  Four.

Karl:  Wrong.  Five.  The name of the coffee.  See, big companies can’t do what Mike does.  He has five employees.  He can respond instantly.  Very flat.  Big companies are siloed and are not flat.  In fact, most are incentivized or rewarded for not being flat!  They can create artificial flatness though.  They can do this by integrating across their organization customer engagement tools.  I like the words you use:  ‘Social Marketing and Social Operations’.  To me that type and breadth of engagement means flat.  Oh, by the way, there is somebody somewhere who is obsessing over measuring their version of straws….even though in the scheme of things, counting straws doesn’t make a bit of difference.

Me:  So in essence, businesses that integrate more deeply with their stakeholders using social marketing tools will always out perform their competitors?

Karl:  Well by stakeholders, if you mean vendors, customers, employees and the like.  Yes.  General statement, but yes.  Most companies can’t or won’t make this type of change until the platform is on fire and even then for some it won’t matter.  Those that do will thrive.  You see everything is interconnected.  Marketing, customer initiatives, product development, operations don’t operate independently.  Or at least they don’t operate well independently.  Heck, you don’t even have to do it all at once.  Start the ball rolling.  As it works, it gains traction and momentum.  Pretty soon, everybody says it was ‘their’ idea.  Oh, and the people sitting in the corner counting straws.  They are quickly reduced to irrelevant quivering lumps of Jell-o.

Me:  Cool.

Karl:  Yep.  Flat is where it’s at.

Steve Hershberger
Steve Hershberger