WHAT IF

PETER DRUCKER TAUGHT

ENTERPRISE 2.0 STRATEGY

What

LESSONS would he

draw?

How would he have explained ENTERPRISE 2.0 to solve toKHy’s IusPnLss problems?

EXPLORE a proposed Curriculum

LLt’s

INTRODUCTION About successful organizations

Drucker stressed three things

MANAGEMENT

INNOVATION

COMMUNITY

Drucker thought a MANAGER’S task is to make the strengths of people effective and their weaknesses irrelevant

Drucker believed that rLlyPnN on yLstLrKHy’s successes are far more risky than constantly

INNOVATING

Drucker considered a business an economic organ that was equally a

COMMUNITY

As for technology he deemed it an extension of the KNOWLEDGE WORKER

DRUCKER: Work creates a unique social bond

HmonNst LmployLLs. |t’s Hlso tOL PntLrMHJL Mor using technology as tools which in turn helps shape corporate culture and personality.

NEITHER TECHNOLOGY OR PEOPLE determines the other, but each shapes the other

So that the result is a more

EFFECTIVE CORPORATION

Work has always been

SOCIAL

But TODAY’S Enterprise 1.0 knowledge worker is SEPARATED from his colleagues and customers

Blocked by voice mail, email and noise

Blocked by voice mail, email and noise

So we’re less social

Blocked by voice mail, email and noise

So we’re less social

Less of a community

Blocked by voice mail, email and noise

So we’re less social

Less of a community

Less effective

But ENTERPRISE 2.0 technologies and strategies can bring community back to work

STILL YET

is not a substitute for poor

ENTERPRISE 2.0

LEADERSHIP

‚Life can only

be understood backwards. But then one forgets the other principle: that it must be lived forwards.‛

WHATWOULD

So lLt’s look IHJkwHrK HnK sLL

DRUCKERDO

LEHMAN BROTHERS THE 31st FLOOR

Before top LEHMAN EXECUTIVES arrived at Headquarters in NYC they would call the front desk

The front desk would get the security guard to HOLD A PRIVATE ELEVATOR

The private elevator was programmed to go straight to the 31ST FLOOR

$100,000 Why did they spend an estimated

to create this process?

$100,000 Why did they spend an estimated

to create this process?

INEXPLICABLE – ‚GLt out and meet pLoplL tOHt’s your laboratory, hands on‛

DRUCKER

Worse, most Lehman employees NEVER saw OR heard from their top Executives

In fact the CEO was nicknamed the

INVISIBLE MAN

HERE HE |S… RICHARD FULD

AVOIDTHEIR

So why did Lehman Executives

OWNEMPLOYEES

SomL JlHPm tOLy KPKn’t wHnt to IL

EXPOSED Mor Hll tOLy KPKn’t unKLrstHnK

Like the sub-prime mortgage CRISIS

Made worse by their ISOLATION

And alarmingly, the best at Lehman were SILENCED as they issued WARNINGS

TRUTH

Execs KPKn’t wHnt to OLHr

TH

E

Later, banks refused to do business with Lehman because of its COMPLEX & OPAQUE methods of trading

CONFIDENCE Soon, investors lost

And the stocked plunged

CONFIDENCE Soon, investors lost

And the stocked plunged

-95%

THEN BANKRUPTCY

But if implemented, would ENTERPRISE 2.0 STRATEGY AND TECHNOLOGY have saved Lehman?

DRUCKER & E2.0 LESSONS LEARNED

MANAGEMENT

Because they were disconnected from the rest of the organization, bad news was either ignored (because they could ignore it in private) or never made it to the 31st floor.

ORGANIZATION & COMMUNITY

The organization became “sick” when management failed to ask themselves, “how long can this market sustain itself?” or even “what’s our current position and what happens if this bubble pops?” Where were the community feedback loops?

TECHNOLOGY RECOMMENDATIONS

MindTouch (Social Intranets) or ThoughtFarmer & Yammer (Microblogging ) would have given the Lehman community a social platform to alert the organization to the impending housing bubble collapse.

POSSIBLY No methodologies or

technologies can replace extremely poor leadership, but the right E2.0 tools and resulting community would have caused enormous pressure to change course.

WOULD E2.0 HAVE SAVED LEHMAN?

DRUCKER

Jas Dhillon ThinkPassenger

NO LLOmHn’s demise was a failure of leadership in

multiple areas including strategy, risk management, organizational culture, integrity and ethics, and possibly including information systems. Enterprise 2.0 technologies can certainly enable greater information transparency up and down the corporate hierarchy but they cannot solve systemic malfeasance and deception. E2.0 systems would not have been able to overcome this organizational penchant for secrecy and opaqueness as they were too ingrained in the organizational culture.

GENERAL MOTORS The Aztek – ‚|t looks tOL wHy MontLzumH’s rLvLnNL MLLls.‛

The Original AZTEK concept car wHsn’t tOHt IHK

So HOW did it end up like this?

=

In fact, the concept car received mostly POSITIVE feedback

So good in fact that GM decided to PRODUCE the vehicle

SALES anticipation was high

GM ANNUAL SALES FORECAST

75,000

PER YEAR

Only 30,000 cars were needed to be sold to BREAK EVEN

GM ANNUAL SALES FORECAST

75,000

PER YEAR

BREAK EVEN POINT

30,000

PER YEAR

But ACTUAL SALES were than lower than break even

GM ANNUAL SALES FORECAST

75,000

PER YEAR

BREAK EVEN POINT

30,000

PER YEAR

ACTUAL CARS SOLD

27,332

FIRST YEAR

But ACTUAL SALES were than lower than break even

GM ANNUAL SALES FORECAST

75,000

PER YEAR

BREAK EVEN POINT

30,000

PER YEAR

ACTUAL CARS SOLD

27,332

FIRST YEAR

WORSE: Of the cars sold more than

50% were sold to Rental Car fleets

WHAT HAPPENED

Beset by money woes, the Manufacturing Dept. DETHRONED the legendary design department which was blamed for rolling out cars that cost too much to produce.

Then manufacturing boss Don Hackworth & team ordered the design to be DELIBERATELY HARDENED

WEIRD FRONT END

PLASTIC CLAD SIDING

a tall hatchback

SQUARE BODY

RESULT AS A

The Aztek is declared a FAILURE

SomL JHllLK Pt tOL ‚The AMC PACER of tOL 21st JLntury.‛

The Aztek is declared a FAILURE

‚WL’K MPrL tOL Nuy wOo GREENLIGHTED the Aztek if we could find anyone willing to HKmPt Pt.‛ Bob Lutz

GM Product Boss

Shortly thereafter, and ‚JoPnJPKLntHlly‛ Manufacturing Boss Don Hackworth announced his retirement after 38 years with GM

So what went

WRONG?

No one noticed the LEMON

BUT

WHY

BUT

WHY 3 REASONS

INTERNAL MARKET RESEARCH

1 went unheeded

INTERNAL MARKET RESEARCH

1

2 THE CONCEPT CAR

went unheeded

was changed to a Saccharine adaptation of the original

INTERNAL MARKET RESEARCH

MANUFACTURING

made key decisions based solely on cost

3

1

2 THE CONCEPT CAR

went unheeded

was changed to a Saccharine adaptation of the original

But could ENTERPRISE 2.0 STRATEGY and TECHNOLOGY have saved the Aztek or caused it not to be built?

DRUCKER & E2.0 LESSONS LEARNED

MANAGEMENT

When the Manufacturing division of Pontiac took “control” they ignored the concept car data and made decisions based on cost. These decisions changed the car and thus demand for it.

ORGANIZATION & COMMUNITY

Pontiac either ignored key data or didn’t reach out to potential prospective customers once the design changes were made. Thus the build/no build market data was outdated and ultimately wrong.

TECHNOLOGY RECOMMENDATIONS

ThinkPassenger, Spigit, or Brightidea would have provided a portal for GM to continuously seek community input (customer & employee) in order to test different ideas or gain new ones.

PROBABLY While Manufacturing may

have ignored any data produced by having an E2.0 organization, at the very least Pontiac would have seen the weaknesses of the Aztek and responded more sharply and sooner

WOULD E2.0 HAVE CHANGED THE OUTCOME?

DRUCKER

Mike Puterbaugh Mindtouch

PROBABLY If they were able to

measure sentiment of the concept car, manufacturing may have seen that perhaps a new cost model was warranted and gone with original design instead of the design that was taken to market

September 11 Spooks, Suits & Terror

The Central Intelligence Agency (CIA) and the Federal Bureau of Investigation (FBI) have been at WAR for decades

The reasons behind this war are due to culture, charter, & INEFFECTIVE communication

The Mission of the FBI is to protect the United States from FOREIGN INTELLIGENCE AND TERRORIST ACTIVITIES; to provide leadership and law enforcement assistance to federal, state, local, and international agencies

The CIA is charged with national security, counterintelligence activities, special activities, and other functions related to FOREIGN INTELLIGENCE AND NATIONAL SECURITY as directed by the President.

On Feb 26th, 1993 an explosive devise was planted and DETONATED on the second level

of the World Trade Center parking garage

People were killed

As a result

were injured

50 thousand

EVACUATED

Ramzi YouSef

After an investigation both the CIA and FBI were criticized for how they had communicated information received about the attack prior to the occurrence.

Egyptian President

Hosni Mubarak

‚VPtHl information was exchanged with American Intelligence and that the attack could have been PREVENTED if they listened to our advise ‛

It was assumed by Egyptian Intelligence that the CIA would pass this information along to its domestic counterpart, the FBI. But due to past differences the chain for sharing this information was not in place.

‚| want coordinated law enforcement and interdiction LMMorts… tOHt mHkL sLnsL…HnK rPNOt now, tOLy’rL not‛

Senator Orrin Hatch

But the rivalry lead to other failures in COMMUNICATION

And all of these examples point to a pattern of

MISCOMMUNICATION between the FBI and CIA due to mistrust.

COMMUNICATION

Unfortunately, these

LHpsLs wLrL not MPxLK…

COMMUNICATION

Unfortunately, these

LHpsLs wLrL not MPxLK…

Which led to DEVASTATING

CONSEQUENCES

W{Y D|DN’T |T ?

9/11 TERROR REDUX

Richard Shelby Senate

Intelligence Committee

"It's going to look like a mosaic that was not put together at the right time. A lot of the failures will go back to the lack of communication between various agencies."

Communication between the FBI and CIA in the months leading up to 9/11 revealed several instances of COMMUNICATION FAILURES

If the two agencies had been effectively sharing intelligence the attacks MAY HAVE BEEN PREVENTED

"In terms of whether or not the FBI and the CIA were COMMUNICATING properly, I think it is clear that they weren't"

As early as January 2000, CIA agents were tracking Khalid Almihdhar and Nawaf Alhazmi in Malaysia at an al-Qaeda conference whom then promptly returned to a flight school in the United States.

But an unnamed CIA officer was quoted as saying ‚No onL pPJkLK up on tOHt‛

Worse, that

INFORMATION was not shared with the FBI prior to 9/11

Worse, that

INFORMATION was not shared with the FBI prior to 9/11

Nor did the CIA NOTIFY ANY GOVERNMENT agencies when Almihdhar and Alhazmi returned to the United States after the al-Qaeda conference

Thus INS did not catch them upon entry into the United States

Shockingly, Almihdhar and Alhazmi were finally placed on the State Department watch list through CIA communication on August 23, 2001

The CIA cable warned that two ‘BPn LHKLn rLlHtLK PnKPvPKuHls’ OHK HlrLHKy entered the United States and that two other suspected terrorists should be barred from entering

Unfortunately Almihdhar and Alhazmi had already obtained new visas by then and had

in the US

DISAPPEARED

Unfortunately Almihdhar and Alhazmi had already obtained new visas by then and had

in the US

DISAPPEARED

They were part of the group that flew a passenger airliner into the Pentagon.

Similar issues

the FBI PLAGUED

FBI Field Agent Colleen Riley complained to FBI Director Robert Mueller that her immediate supervisors discouraged her Minnesota Field Office to search the computer hard drive and belongings of Zacarius Moussaoui (considered to be the 20th terrorist in the hijackings).

Worse, the FBI was NOT ALLOWED to

with the CIA nor see the CIA files on Moussaoui

COOPERATE

In a separate occurrence, Special Agent Kenneth Williamson sent a memo to FBI superiors in the summer of 2001

“I’m concerned that suspected al-Qaeda members are enrolled in flight schools in

Arizona.”

But WPllPHmson’s superiors largely ignored the memo, and failed to pass information on through

intelligence channels

Minneapolis Phoenix

Not only did these concerns fall upon deaf ears, neither FBI office was aware of the otOLr’s rLlHtLK JonJLrns KuL to Hn OUTDATED, INEFFECTIVE INFORMATION system

‚TOL FB| has no way to place leads, tips and other potentially useful information in an electronic repository that agents can sLHrJO‛

‚TOL FB| has no way to place leads, tips and other potentially useful information in an electronic repository that agents can sLHrJO‛

In effect, not only was the information not passed to others at the FBI, it definitely did not make it to the CIA.

DISTRUST

DISTRUST

The cultures at the FBI and CIA lead to an additional level of communication ineffectiveness and contributed to the inaction prior to the 9/11 attacks

DISTRUST

There are also various institutional constraints, such as organizational bylaws and even federal laws that restrict certain aspects of the sharing of intelligence between the two agencies.

WHY

D|DN’T T{E FB| &

CIA CHANGE

FROM THE 1993

ATTACK

If implemented would ENTERPRISE 2.0 STRATEGY AND TECHNOLOGY have changed the culture and IT systems at the FBI and CIA and thus prevented the 9/11 attacks?

DRUCKER & E2.0 LESSONS LEARNED

LEADERSHIP

The Government failed the American People by not establishing a more effective communication system after the 1993 attacks. They also didn’t act to change the negative impact of FBI/CIA culture

ORGANIZATION & COMMUNITY

The lack of an organized system, cultural issues, legal restraints and an inferior information sharing structure led to the “malfunction in information”.

TECHNOLOGY RECOMMENDATIONS

MindTouch (Secure Social Intranets), SharePoint, Jive Software, or Atlassian Confluence would have provided a secure information sharing hub between agencies.

POSSIBLY Had the proper information

sharing system been in place prior to 9/11, the collaborative efforts of the FBI & CIA may have uncovered the plot. Yet deep cultural issues and a lack of overall leadership may have rendered any E2.0 efforts useless

WOULD E2.0 HAVE CHANGED 9/11?

DRUCKER

Aaron Fulkerson Mindtouch

A SKEPTICAL MAYBE while

E2.0 solutions would have certainly helped and may have allowed the CIA or FBI connect the dots, I am not convinced the US Government would have adopted a proper E2.0 strategy due to cultural issues

SUMMARY

Organizations are going to

change

When there is an easy way to COLLABORATE people always will

The key is to provide technology that enables EASIER collaboration

COMMUNITY

to thrive

for

INNOVATION

MANAGEMENT AND

So that the technology facilitates social connections with people

which IMPROVES business

and creates NEW customers

and catastrophic mistakes are

AVOIDED

We call this

ENTERPRISE 2.0

DRUCKER ‚MHnHNLmLnt is about human beings. Its task is to make people capable of joint performance, to make their strengths effective and their weaknesses irrelevant. This is what organization is all about, and it is the reason that management is the critical, determining factor.‛

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CREDITS & ATTRIBUTION Slide Sources Notes

7-15 http://www.amctv.com/originals/madmen/

26 http://www.flickr.com/photos/matthew_cameron/2868770311/sizes/l/

27 http://www.flickr.com/photos/sparkfun/4255272762/sizes/o/

39 http://www.entertainmentwallpaper.com

96 http://www.flickr.com/photos/batram/3140360731/

124 - 129 http://www.amctv.com/originals/madmen/

120, 123, 132

http://www.druckerinstitute.com/

http://www.amazon.com/Colossal-Failure-Common-Sense-Collapse/dp/0307588335 Lehman Brothers case history

46, 74 http://www.thecontenteconomy.com/2010/01/enterprise-20-and-collective_21.html Oscar Berg

MARK FIDELMAN Enterprise 2.0 Enthusiast

@markfidelman