Tap into the network
Companies are struggling to make sense of a new networked reality, in which job titles and hierarchies carry less weight than your ability to tap into the network, share your knowledge and make sense, and create value out of the continuous flow of information in multiple channels.
So says Peter Hinssen, a leading technology thinker and author of several books on business innovation. He recently sat down with Danish SAS Institute Country Manager Keld Zornig for a discussion on the consequences of this reality. They talked about how companies need to change their thinking to overcome the disruptive forces of the new network economy.
‘This new reality, in which people get their information from tapping into networks and have stopped listening to traditional media, is scary to them. And if you tell them that markets are going to disappear and turn into networks for intelligence, they are completely unprepared to deal with this reality,’ Peter Hinssen says.
The disruption of marketing
He uses the example of Michelle Phan, who has become a very wealthy young woman from the revenue derived from her YouTube channel. Six million subscribers tune in to see her make-up application tips in videos she produced in her bedroom.
‘She is now the number one biggest influence on girls age 14 to 19 in the U.S. when it comes to make-up. These kids do not read magazines or watch TV ads. But they are tapped into the network – and this is something that could never have happened before. It is a nightmare for traditional media and a huge challenge for companies in general,’ says Peter Hinssen.
‘Companies have traditionally built reservoirs of information, huge databases of CRM information and other data – but they have no idea what these customers are doing in their lives.’
Keld Zornig points out that although this new reality may seem daunting, many companies are starting to embrace marketing techniques that let them tailor more individual messages to customers and markets.
‘But I agree that companies are still struggling to deal with information from outside their silos. Most still feel most comfortable treating marketing information in one place, sales leads in another and so on. But they have become much more aware that real business value comes from being able to combine data from the silos with outside data and distribute them to the relevant parts of the organisation,’ he says.
The new role of the CIO
Some of the people most challenged by this new reality are the CIOs, who traditionally have acted as providers of infrastructure. According to Peter Hinssen, CIOs ‘have been too busy implementing stuff’ and not been able to leverage this challenge as a strategic issue with the board of directors.
‘As other managers are becoming more tech-savvy, they are starting to do things around the IT department because they think it is easier. It is a big challenge to reinvent the role of the CIO. Some companies are starting to hire very different profiles from different backgrounds who take more of a business value point-of-view’.
From threat to opportunity
Keld Zornig points out that although security is an important issue, perhaps too much attention has been put on the CIO’s role in keeping data safe from the threats of outside intrusion – and public debate has also focused a lot on individual privacy and our fear of being exposed to the prying eyes of companies and government. Keld Zornig points to medical data as the best example.
‘We tend to talk a lot about the dark side of the information explosion and not enough about the benefits and potential. When we are able to combine medical information, it will lead to better treatment. It is scary to people of our generation and older, but our kids are not going to mind. They are OK with the fact that a lot of their personal information is out there. And they don’t mind being approached with relevant information, even marketing.’
Peter Hinssen nods in agreement and laughs as he recalls a recent episode in which he felt somewhat intimidated when online ads instantly started mirroring information from a Gmail exchange with a friend about a planned bicycling trip. Hotel suggestions and click-pedals started popping up everywhere.
‘It freaked me out a little, but my daughter said: Dad, you are being silly. Think about how much time Google just saved you!’