For some authors writing on the topic, the recent discussion of transparency and ‘openness’ in business points to a post-credit crunch societal shift, a reassessment of the moral obligations of the corporation.
Not so Charlene Li, former Forrester Research analyst and founder of the young but already influential Altimeter Group. Her new book, Open Leadership, takes a more pragmatic approach. For Li, the reason why openness is a growing concern for businesses is, to put it simply, the rise of social media. Social technologies have, she argues, made it easier for employees and customers to share their experiences, forcing companies to adopt a more open leadership style.
Open Leadership is therefore very much a continuation of Li’s previous book, Groundswell, co-authored with Forrester analyst Josh Bernoff. First published in 2008, that book was an early introduction to the dynamics of social media in a marketing context, and the preponderance of case studies distinguished it from some of the more speculative essays of the time.
Li sticks to the formula with Open Leadership, this time turning her attention to the way social media affects organisational dynamics and customer relationships. There is no grand theory as such but a great number of examples and executive interviews.
It is, however, Li’s own experience that is the real selling point of this book. Her work with clients has seen her develop real-world best practices and policies for using social media to promote openness and customer engagement, and Open Leadership gives an introduction to how this is done.
For example, she describes the value of a ‘sandbox covenant’, a mutual agreement between employer and employee that social tools will be used responsibly. She argues that trusting employees with a certain degree of freedom will be met with respect and thoughtful social media use.
Li also presents a return-on-investment model for the various objectives of openness. These models are based on so many assumptions, it must be said, that it is debatable how useful they will be, taken at face value. But they show how governance and process might be applied to social technologies.
Like many business books, this verges on pop psychology in parts, for example when Li presents four ‘archetypes’ of open leadership – ‘the realist optimist’, ‘the fearful skeptic’, ‘the cautious tester’ and ‘the transparent evangelist’ – although she acknowledges that this is more of a device than a description of underlying truths.
Another concern is that a large proportion of the case studies come from IT companies, such as IBM and Cisco. The concept of openness has a particular cachet in the IT industry, whose culture values openness in the sense of open source and open standards because it has so often been withheld in the past. Cynics might therefore question whether all the IT companies profiled in Open Leadership are as committed to true openness as they are to the image of openness.
Li presents the example of consumer electronics maker Apple as an exception that proves the rule. The iconic vendor is not at all open, Li writes, but that is a luxury afforded by its phenomenal success, not a determinant of that success. Less fortunate companies, such as Dell whose IdeaStorm portal allows customers to suggest new products and features, need to use these tools if they are to inspire the kind of loyalty that seems to come naturally for Apple. This is a cogent argument, but what business would rather be Dell than Apple?
The purpose of Open Leadership is not to convince people that things are changing, if anyone still needs convincing. Instead, it is for professionals who already see the balance of power in employee and customer relationships shifting as a result of social media. For them it will provide reassurance that this is not a shift to be afraid of, and that it is not necessarily leading to a total loss of control.