A little discussion on "Corporate Transparency"…

In Convincing the Unconverted, Part 3, I shared a list of reasons, or motivations, for businesses to engage in community development.  One of the topics I mentioned was Image or the “humanization” of your company.  I thought this topic deserved a bit more exploration. 

To me, we reached this point through natural evolution (The Evolution of Consumer Empowerment) aided by a cocktail of recent catalysts driving corporate transparency.

• A new generation (Gen “Y”)
• Sarbanes-Oxley
• Web 2.0

A New Generation:

Let’s start with a short discussion on Generation Y (roughly those born between 1981 and 1999) and “why” I think this is important.  A quick review of Gen Y is helpful and wikipedia provides a good baseline.   

Note:  There is considerable controversy on the naming of this generation, including “net gen, millenials, google gen (I hate this one – oops, bias slipped in), gen next,” etc. 

The point of this post is not to dive into these inherently controversial topics, but to talk about how these generational differences are leading to Corporate Transparency.  I think anyone who has ever had parents or children (I’m hoping that gets everyone here) can agree that there are significant differences between the generations.  While our parents might look at us and think we should behave more like them and we look at them thinking they should behave like us, the reality is neither will happen – the same will be true for our children.  The example that brought this home for me in a business context was a colleague who said the following: 

Today’s 22 year old coming out of college into the workforce will have the expectation that they can just walk into the CEO’s office and present and defend their ideas.

It was a simple anecdote, but it struck me that I think it’s generally true.  Now, I’m not judging this as good or bad, right or wrong, only substantially different than the way most traditional companies function today – you “earn the right” vs “expect the right,” so to speak.  This is the generation of interaction.  Not the gen that watched TV as much as they played online.  Not the gen that watched the evening news, but the gen that created the news in the blogosphere.  The traditional company will think these “kids” should behave like their “parents” and these new “kids” will not understand why their “parents” aren’t behaving like them.  (In a future post I will explore this further in the context of how communities could impact the traditional corporate HR functions.)  In the end, businesses are people-driven and will need to evolve to learn from and leverage these generational changes, or you can be sure they will suffer from talent retention.  This new generation will bring with it a fundamental shift in how knowledge within companies, with users and across partners is shared.  Strap on your seatbelt, they may well know something you don’t.

Sarbanes-Oxley:

I look at Sarbanes-Oxley as another catalyst driving corporate transparency (albeit the stick vs the carrot..).  This legislation was passed in response to several scandals involving accounting irregularities – most notably with Enron, Tyco and Worldcom. These scandals ushered in a new era of corporate distrust.  Suddenly, we not only wanted increase corporate accountability and transparency, but we wanted it for much more basic reasons.  Enter Maslow’s Hierarchy on needs.  We didn’t want this transparency for reasons of belonging, esteem, or self-actualization (strong drivers I would associate deeply with Gen Y), but for very fundamental reasons of Safety.  People, a lot of people, got hurt in what can only be describes as outrageously offensive corporate acts. 

Read/Write Web:

Enter Web 2.0.  A new, highly engaged and interactive generation born in the age of online gaming, facebook, myspace and youtube is driving a wave of participative-culture change, fueled by an environment of corporate distrust.  A great cocktail for re-inventing how business gets done in the social web.  In this new business reality, static or non-interactive web pages offer little value to a generation looking for interaction and discussion.  This is where your company, or more specifically your employees (who, by the way, are more and more represented by Gen Y) come in.  I may not know what your company does, but I know what most of your web pages say without ever visiting them.  What I want is a relationship and I can’t have a relationship with a Web 1.0 portal.  I want to interact with your employees through employee blogs.  I want to connect with and read content written by other users.  I want to participate in product feedback and discussions.  I want to help myself and I’d rather not talk to you on the phone (in your call center).  These are my new expectations.   How you as a company choose to engage in this new openness is your opportunity for transparency and your opportunity to re-invent your image and humanize your company through personal connections.  Remember, it’s easy to dislike a company – it is harder to dislike the people, once you know and relate with them.

Sure, there are lots of other catalysts contributing to this evolution, including Moore’s law, broadband proliferation, mobile phone penetration, etc – but I see these more as enablers of change vs agents of change. 

Any thoughts on this?

Sean

 

Technorati tags: Maslow, Community, online communities, web 2.0, sarbanes-oxley, facebook, myspace, moore’s law, gen y, O’Driscoll