Is your business a new power or old power?
Jeremy Heimans and Henry Timms are all over the place lately, writing and talking about the wave of “new power” in business. It’s an idea that’s powerful enough that CNN, in naming it one of the 10 Ideas of the Year, credits it for “upending the status quo.”
Heimans and Timms are forceful advocates for widespread empowerment and genuine collaboration. We all know the “old power” business model: a rigid hierarchy that, regardless of whatever lip service is paid to transparency and collaboration, keeps the real power and the real decisions safely ensconced in the C-suite or boardroom. The authors call these organizations “castles,” citing examples like Apple’s penchant for top-down product development and relentless IP protection.
“New power operates differently, like a current,” Heimans and Timms wrote in Harvard Business Review. “It is made by many. It is open, participatory, and peer-driven… Like water or electricity, it’s most forceful when it surges.”
Signs you’re an old power
You can see businesses flexing old power both by how they operate internally and by how they treat customers. Take it from a guy who used to work with a bunch of newspapers: not everyone has gone skipping into the era of co-ownership. Some organizations still don’t expect much back-and-forth with customers; one telltale sign is when a business leader repeatedly refers to consumers. Consumers consume and go away. They don’t co-create. They don’t serve as ambassadors. When I was working in newspapers, we talked about making the transition from attracting passive consumers of content to encouraging active participants in the entire process. Now you can see myriad examples of brands welcoming customers as co-creators, inviting them into business processes that used to be completely shut off from outsiders.
It’s easy for a five-person startup to feel a little cocky about its status as a new power, but the fact is that it’s a lot harder for an old business to reinvent itself than it is for, say, Buffer to adapt a culture of extreme transparency (and even that was not without growing pains).
Heimans and Timms cite TED as a case of an entity jumping from old power to new power. “In its earliest days, TED was essentially a gathering of an emerging power elite with roots in Silicon Valley and the bi-coastal creative class,” they wrote. “It traded on the scarcity of its coveted seats and the selectivity of its application-based process.” Today, of course, TED content is more freely accessible, moving it well beyond its original goal to be primarily a must-attend live event. TEDx empowered TED fans to spread the brand, but required a leap of faith; with the loss of castle-level control comes some risk of brand dilution. But it seems that TED is just doing fine.
Signs you’re a new power
New power puts a premium on collaboration—and, as we’ve discussed on this blog in the past, distinguishes between assembly-line teamwork and genuine collaboration. As Heimans and Timms say, these “new” collaborators “share their own ideas, spread those of others, or build on existing ideas to make them better.” Transparency and a DIY, maker-centric mindset will flourish in these organizations. If mid-level employees see a broken process, are they empowered to fix it?
At the heart of new power is the desire to participate—and not as a favor gifted by benevolent bosses, but as an “inalienable right,” as the authors say. It’s becoming a condition of continued employment, or, from the customer’s perspective, a condition of continued business.
I just finished reading Make Your Mark: The Creative’s Guide to Building a Business with Impact, the third in a great series from 99U, and a book that philosophically aligns with the “new power” movement. In the book, David Marquet gives his take on building a team of leaders rather than followers, drawing from his own high-stakes experiences as the commander of a nuclear submarine (and you thought your LinkedIn profile sounded cool).
“I learned that if you want people to think, telling them what to do is not the best way to do it—in fact, it’s the worst,” he writes, detailing an exercise in which he issued a faulty command only to have it unquestioningly ordered by a second-in-command. “Once treated like followers, people act like followers. It saps their passion and initiative.”
After the pivot toward new power—in one of the more old power-centric settings imaginable—the results were pretty overwhelming. A ship that had been ranked near the bottom of the fleet in terms of retention and operational measures was suddenly best-in-class. 33 people reenlisted, compared to only three the year before—even though, as Marquet notes, his team was working harder than the year before. Marquet is no longer in command, but the ship still has unusually high levels of promotion and success.
“This is the legacy of giving control, creating leaders,” Marquet says.
Of course, don’t count out “old power” just yet. Take it away, Sir Richard Branson!
“New power doesn’t necessarily mean for the better, and whilst I think the shift will force old power models to adapt, I also think it will lead to interesting collaborations between old and new power models,” Branson wrote on LinkedIn. Branson, though, also favors disrupting old business models—so long, presumably, as Virgin keeps a seat at the table.