John Seely Brown argues that be foundational focus of business is shifting away from process optimization to network density:
John Seely Brown, Social Media Will Play a Crucial Role in the Reinvention of Business
The classical view is that the firm exists to minimize transaction costs. But John Hagel and I suspect that the firm has a new purpose — namely, to promote the development of talents and capabilities and thereby attract and retain the best in the ongoing wars for talent, and at the same time create an entrepreneurial culture that nurtures employees’ questing and connecting dispositions.
It’s no coincidence, by the way, that some of the most innovative companies are those that are tied into social media. Social media itself is a threat to the corporate comfort zone. How many executives have you heard say that even though their companies are on Facebook and Twitter, they don’t use social media themselves? The transparency and unpredictability of social media can be deeply unsettling to people who have grown up in the comfort of corporate environments.
But the more executives experiment with social media, the more they’ll see how it can play a crucial part in forming the infrastructure of the new ecology of edges that will ultimately transform corporations for the future.
Interesting that Brown transitions from a case for business as an incubator of individual and collective growth, through networks, into an almost offhand discussion about senior executives aversion to using social networks personally. As recent studies have shown, this senior executive ‘social blindness’ is widespread, but Brown’s point is that the nature of social media tools runs counter to long-established social norms in business.