The Disruptive Force that is Societal ValuesPosted on April 12, 2012.
The final of the 5 Trends Disrupting Business In The Next Decade is shifting social values. If the previous four trends are changing the world as I have suggested, then it should not be surprising that people’s values, their dreams and aspirations, their expectations of what a good life looks like, their desires for their lives, work, families and careers are all changing, too. This trend is the most difficult to pinpoint – and respond to. But it is most definitely happening, and will ensure that the other trends I have spoken about are not just passing fads. We are living through an era of radical change that will end up with us on a new trajectory in human history. This has happened many times in history, most notably during the Renaissance, the Reformation and the early Industrial era. It is now happening again.
At one level, “shifting societal values” is not a fifth trend – it is rather the summary of the other four trends. Let me use one industry to illustrate this.
Attitudes Towards Music
I can remember as a child spending many happy weekend afternoons listening to my parent’s collection of vinyl records. The soft hiss and intermittent scratch as the needle bumped along the record groove were the background noise to the music of the 60s, 70s and 80s. Then came cassettes and the Sony Walkman, with teenage years of compilation albums and stretched tapes (and mangled tape as the batteries in my boombox died and the machine ate the music and destroyed my favourite album). Compact Discs were warmly welcomed, with their huge leap in quality and durability. And then came MP3s, the iPod and the digital age. Now it’s possible to have our entire CD and LP collection on a small memory stick that can fit into the palm of our hands. But the real revolution is that you can plug that memory stick into your friend’s computer and download thousands of songs – but you get to keep them as well. It costs nothing.
The music industry has responded to this by trying to turn us into criminals. Hollywood has a similar problem. Every time I spend good money to go and watch a movie, numerous infomercials tell me how many criminal acts I could commit if I even think of taking my mobile phone out of my pocket and recording an image off of the screen. As someone who makes money selling intellectual capital, and earns royalties on book sales, I am not in favour of the wholesale theft of music or movies. But I am equally incredulous that the geniuses behind the entertainment world have not yet worked out how to find a middle ground. I don’t want to have to buy a whole album if I only like one song. I want to be able to share songs with my friends, introducing them to new music, so that they can enjoy what I like (and probably go out and buy the album for themselves), and spend serious money to join me at the band’s live concert. I’d also like to be able to make a copy of the CD (or DVD) so that if the original gets damaged, I still have the music I bought. And, why won’t they send me a free MP3 of all the albums I already have purchased on LP, then again on cassette and again on CD over the last three decades?
Of course, one company did see the change coming, and were able to do something about it. That company was not part of the music industry, but now, just three years after embarking on a music strategy, it is the largest music retailer in the world. That company is Apple. Through their iTunes store and a clever technology licensing solution, they’ve taken the music industry by storm. And they’ve changed the habits of millions of people around the world. Add to that the iPhone app industry they’re spawned in the last two years since opening the iPhone platform to independent application developers, and Apple computers would have been a good share to buy a few years ago. I’d still buy them now, since the music industry – as well as the phone manufacturers and mobile telecoms providers – are still scrambling to catch up.
Our attitudes towards music, downloading, and sharing have all changed in recent years. This has been enabled by technology and is driving institutional change that will reshape the music industry forever. The entertainment industry may be an extreme example, but almost every industry in the world will face similar changes in the next decade. We ignore shifts in societal values at our peril.
Changes in Expectation
Changes in expectation are also impacting your workplace. Recent research is showing that some of the ways in which we have tried to motivate and manage people are no longer working. This is because people have changed, and the world in which we work has changed. Many management techniques are based on assumptions about people’s values that were true for an industrial, manual labour oriented workplace. We no longer live and work in that world.
This is not the place to go into detail, but a few examples will illustrate this point. Pay for performance motivation techniques have been proven to be ineffective in any environment except manual labour. This is the amazing outcome of detailed international research by Daniel Pink, “Surprising Truth About What Motivates Us”.
People might want bonuses and cash rewards, but giving it to them will either be demotivating or will encourage destructive behaviour. When I have presented this research to audiences, I invariably am greeted with sceptical looks. It sounds incorrect – until you examine the evidence. For example, the banking world is probably most renowned for their culture of extraordinary bonus payments. That worked well for them in the last few years, didn’t it? Some argue that sales people would not work unless they were paid for their performance. Pink’s research is not talking about commission, but rather about bonuses, but even with sales people, I wonder how many of your sales people are adequately incentivised to complete all their post sales admin, their follow up customer care and their client retention responsibilities? A bonus culture tends to reward the “hunt”, rather than the relationship, and that can result in long-term detrimental activity for your brand. Pink’s research is pretty convincing – if you’re prepared to accept that we live in times of remarkable change, as the structures of our institutions shift.
Another example relates to virtual, temporary teams. I recently met with a young insurance sales superstar. He outperformed the rest of his sales team by almost double on a regular basis. Of course his boss asked him to share his secrets with the rest of the team (he refused, by the way, since the bonuses were calculated on a relative basis in terms of performance in relation to the average in the team, so he had no incentive to help others). His secret was simple: he employed his own assistant. This was a person who was not known to his company, nor paid by them. He paid this person out of his own pocket, and managed them virtually. This type of assistance is now generally available – either ad hoc or permanently. Our expectations of what a team looks and feels like is changing, and this shifting value will impact how our companies are structured.
A final example is managerless teams. Research repeatedly shows that teams that have to operate without a manager for an extended period seem to improve their performance. This might happen when a manager has extended sick leave, is relocated to another office, or is just not replaced due to headcount restrictions. Whatever the cause, the result is most often that the team finds a way to work more efficiently and effectively without the manager. So why do we have managers at all? Gary Hamel’s “The Future of Management” or Henry Mintzberg’s, “Managing” are good books to read on the topic of how management needs to change in the next decade.
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If the previous four trends are changing the world as I have suggested, then it should not be surprising that people’s values, their dreams and aspirations, their expectations of what a good life looks like, their desires for their lives, work, families and careers are all changing, too. Many companies are hoping that we will soon get “back to normal”, but it isn’t going to happen. The downturn has been more than economic – it has served to catalyse many social, political and values changes that had already been underway, and will now change the world forever.
You need to consider what expectations are changing in your staff, customers and business partners. Not just in relation to you and your offerings, but to their entire lives and how what you do for them fits into these. This trend has the most potential to surprise you. Therefore it also is the key to gaining access to the hearts and souls of your stakeholders – and that is where the new sustainable competitive advantage in your industry is to be found.
What changes in societal values are likely to disrupt your industry in the next 3 to 5 years? Who is helping you to ask the right questions about this issue? And where are you going to find the answers?
In his next article Dr Graeme Codrington will talk about “How You Should Respond: Surviving a Tidal Wave of Change”.