Understanding “New Power” by Jeremy Heimans and Henry Timms, which appeared in the December 2014 issue of the Harvard Business Review, describes an interesting, complex and transformational shift of power in the world. The concept of Old Power, (held by a few, jealously guarded, well stocked, closed, inaccessible and leader-driven) and New Power (made by many, open, participatory and peer driven) are positioned as mutually exclusive. That said, the shift to New Power is on a continuum, picking up pace, influencing and informing virtually every aspect of our contemporary lives and changing the landscape of philanthropy.
Four years after Understanding “New Power” was published, Peter Weill, chairman of the MIT Sloan Center for Information Systems Research, and Stephanie Woerner, a research scientist at the Sloan Center, explained the concepts behind their new book What’s Your Digital Business Model?: Six Questions to Help You Build the Next-Generation Enterprise. Their book zeroed in on understanding what makes top-performing companies thrive in the digital era.
The authors posit that customers now look for opportunities to engage, participate and solve life events. To be successful, business must move to a knowledge-based information economy and digital business model that tries to meet the life event needs of customers.
Not surprisingly, the “New Power” paradigm informs key concepts suggested by the authors to help successfully transform organizations, providing a Digital Proficiency Checklist to amplify the customer’s voice, and guiding organizations on how to thrive in the “New Power” and Next-Generation Enterprise world.
Key points to consider:
-Once digital threats and opportunities are identified, harness digital competitive advantages to make the most of them.
-Move to a digital model that reflects and meets the life event needs of the customer. As examples, Staples’ new tag line is Work, Learn, Grow. Weight Watchers looked at how customer preferences are changing, their perspectives on what a great experience is, how they are interfacing with technology and their expectations for personalization. Their new strategy includes integrating online social media community groups, audio music, meditation content and workouts throughout its app, and provides personalized ratings and rewards for healthily choices.
-Set vision, draw on analytics, integrate data, and consolidate organizational silos to create a knowledge-based information company.
-Connect customers and put them in control using technologies like mobile or the Internet of Things, an extension of Internet connectivity into physical devices and everyday objects. Embedded with electronics, Internet connectivity, and other forms of hardware, these devices can communicate and interact with others over the Internet, and they can be remotely monitored and controlled. As an example, Weight Watchers is adding its services to digital personal assistants such as Amazon’s Alexa.
In their book Blitzscaling, pioneering entrepreneurs and New York Times bestselling authors Reid Hoffman (co-founder of LinkedIn), and Chris Yeh, draw on their experiences scaling startups into billion-dollar businesses, offering a framework easily replicated in any region or industry. Reid believes strongly in the ability of entrepreneurship and technology to improve the world. Yeh, has founded, advised or invested in over 100 tech startups since 1995, helping them plan for and achieve “hypergrowth.”
Blitzscaling articulates a specific set of practices for igniting and managing dizzying growth; an accelerated path to the stage in a startup’s life cycle where the most value is created. It prioritizes speed over efficiency in an environment of uncertainty and allows a company to go from “startup” to “scale up” at a furious pace that captures the market.
Beyond their application in the for-profit sector, New Power, Next -Generation Enterprise and Blitzscaling provide powerful tools for social impact. Dress for Success and the Obama Campaign provide two examples of the power of “The Trifecta” applying key principles such as the Network Effect, leveraging contributions of a community or another existing network, and innovative Distribution Models, to manage the strains of rapid growth and maximize impact.
Dress for Success (DFS) was able to get around the limitations of manpower and circumvent the challenges of operational scalability without consuming cash by partnering with organizations serving the same clients. In exchange for DFS accepting clients of other organizations, partners were required to provide volunteers. This use of the Network Effect allowed DFS to scale the number of people it served in the workforce needing their service, all without consuming their financial resources. DFS also leveraged the power of an innovative Distribution Model, inviting anyone who wanted to open a DFS shop to New York “to sleep on their futon” so they could be trained and return to their hometown to start up the new DFS shop.
In 2008, the presidential campaign of Barack Obama used the power of “The Trifecta” to catapult a little-known first-time Senator from Illinois to the White House.
Through unprecedented use of connectivity, the campaign was able to coordinate a decentralized movement. The key was the use of technology to leverage existing networks and achieve powerful distribution. Their focus on small donations from individuals via internet rather than large donations allowed a new campaign business model, raising more money than any previous candidate: $650 Million in campaign contributions. Over half that amount came from donations of less than $200. In contrast, only 27% of the money raised during the 2004 election came from low dollar donors.
The Obama campaign also utilized technology to build and manage an army of volunteers to get out the vote. They created three key tools that leveraged growth factors to help Obama win the election.
The first, my.barackobama.com (MyBO) was a social network that leveraged existing networks of Obama supporters, allowing them to connect with one another, as well as create groups, plan events and raise funds.
The second tool, Neighbor-to-Neighbor was a canvassing tool. When MyBO users logged in, Neighbor-to-Neighbor provided a list of undecided voters they could call on or visit. Neighbor-to Neighbor tapped into online databases to match volunteers with people they would likely connect with, considering factors like age, profession, languages spoken, and military service. This enabled the campaign to generate 8 million calls and tremendous word of mouth.
The final tool, Vote for Change was a voter registration site, which automatically sorted voter registration rules to help potential Obama voters register correctly. During the campaign, Vote for Change helped one million people register to vote—-roughly the same number as two thousand paid staff could handle using the door-to door-method. Obama received over sixty-nine million votes, still a record for any US presidential candidate.
The power and principles of “The Trifecta”, New Power, Next-Generation Enterprise and Blitzscaling apply to any organization, of any size. Customers, constituents, prospects and doors want to interface with technology, desire a great experience, and have expectations of personalization. Fundraising strategy, constituent mobilization, resource allocation, strategic and campaign planning, how gift pyramids are structured, gifts are made, and success is achieved, has entered a new dimension. S. Sutton & Associates Inc. is poised to assist you and/or your organization as you apply “The Trifecta” and maximize the impact you have upon the world.