The core of the social business

February 17, 2013

We are in the midst of a shift from the industrial system of supply and demand to social, co-production models. The customer is now seen as being directly and actively involved in the key moments of value creation as opposed to passively consuming value. There are profound implications that result from this change of thinking. Products and services are not reproducible as such any more. Solutions are by default contextual and personalized, but they can be starting points for someone else to create value.

Creative, connected learning is at the core of the social business.

It is not learning related to meeting the requirements set by someone else, but learning that is motivated and expressed through personal, situational needs. As a result, a new meaning of education and learning is emerging.

Business, more than government, is driving the changes in education that are required for the knowledge-based economy. The government-run education systems are lagging behind the transformation in learning that is evolving outside schools. Businesses are even coming to bear the primary responsibility for the kind of education and learning that is necessary for a country to remain competitive in the future.

MaisemaGutenberg’s printing press broke the monopoly of the church on what was taught and by whom. Today’s social technologies are doing the same to schools and universities. The learners decide what is taught and by whom. The new technologies are perhaps not making teachers and schools obsolete, but are definitively redefining their roles and breaking local monopolies.

A learning business is not the same as the learning organization made popular by Peter Senge and many others. It is not about systems thinking, or learning how to use technologies and data.

A learning business is one that leverages the economic value of knowledge.

Producing more value than is used is the characteristic of productivity. True learning businesses must therefore be teaching businesses. This means communicating to customers the additional value of learning in the context of the services and products offered. Learners are teachers and teachers are learners. Creating learning connections is more valuable than creating learning content.

Inside an organization, all people must take responsibility for information and communication. Each person needs to take responsibility for his or her own active contribution. Everyone needs to learn to ask three questions continuously. What information do I need? What information do I owe others? With whom should I communicate?

Each level of management and each process step is a relay. That was OK when the speed of learning was not an issue. It was also OK that businesses were hierarchy-based, because transparency was not possible. In a learning business each relay means cutting the potential for learning in half and doubling the noise. Hierarchy used to speed things up, now it slows down.

The most important principle of a social, learning business is to build the organization around information and communication instead of around a hierarchy.

There is a debate going on that focuses on the distinction between ethical and practical education. There are people who emphasize moral values and those who underline the practical reasons for education. There are voices that are concerned that business-driven learning would mean less moral and ethical education than under government-led learning. But there are also people who stress that in order for any business to thrive in the new economy, it needs to show a new, intense and honest interest in values and sustainable ethics. Some people I know inside the church have been surprised that leading corporations dedicate more time to education about values than they, or schools do.

We have moved to a new economy, but we have yet to develop a new educational paradigm.

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Andrew Ng on the importance of universal access to education. Clayton Christensen on disrupting the education industry. Joi Ito on formal vs. informal education. Clay Shirky on social reading. Paul Graham: “Large organizations will start to do worse now because for the first time in history they are no longer getting the best people

2 Responses to “The core of the social business”

  1. Kopecki Says:

    Very good post. I agree in particular to this statement:
    “The most important principle of a social, learning business is to build the organization around information and communication instead of around a hierarchy.”

  2. Torkel Tallqvist Says:

    Esko,
    This resonates very much with both my experience and knowledge of how industrial innovations taken place. It is a pity that that when the innovation mararthon has been completed, the heroes of the thinking you write are overshadowed by ‘hig caliber big foots’ harvesting the dividends from investment done.

    Keep up the good work!


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