How Organizational Insights Drive Competitive Advantage
Brands, businesses, companies, corporations, institutions and other large organizations should take some advice from Socrates: “Know Thyself.”
With so much time, money and effort being spent on locating, socializing and applying new knowledge about customers and consumers to gain competitive advantage, few organizations are investing in the kind of research that could power up equally, if not more, actionable, transformative and ongoing success: insights into themselves.
It’s not that the process is unclear or unknown. With Campbell’s 39 Indicators, Quinn and Rohrbaugh’s Competing Values Framework, Martin and Siehl’s study of corporate subcultures, McKinsey’s organizational health approach, and dozens of professionals working in management, psychology and anthropology, there is no shortage of models or methodologies that can be applied to identify the inner workings of the organization. Some are designed to do little more than identify familiar territories such as hierarchical vs. matrixed, internally focused vs. market focused, individual vs. collaborative, intuitive vs. analytical, rigid vs. flexible and so on. Others seek to locate archetypes, personality types and culture as a way of assessing how the values, attitudes, beliefs, behaviors, assumptions, artifacts and language of an organization shape its performance.
So why, when it comes to currently critical needs like developing a more effective and profitable innovation process or incorporating Design Thinking principles and practices into a business, are so few organizations ready, willing and able to look within? If we turn to the Suda, the answer is clear. The 10th century encyclopedia of Greek Knowledge tells us that Socrates’ famous aphorism is directed primarily towards those “whose boasts exceed what they are.” If this is so, the absence of an appetite for internal insights might be a symptom of corporate mythology.
In the context of a business, a mythology is that set of stories that employees at every level of a company tell themselves about who they are, what they do, why they do it and their place in the world. Sometimes, like a brand positioning statement that has become so successfully entrenched in the market that it is subscribed to by those responsible for producing or maintaining it, they function as an internal version of a Reason To Believe. Here, along with the realities of shareholder earnings, brand ideas about ‘helping people,’ ‘a fun night out’ or ‘making life better’ not only romance customers but also help provide some meaning and purpose for employees. Other times, like the cheerleading that goes on in annual reports, the mythology has evolved into a vocabulary that employees use to describe their own work and the characteristics of the company itself. Here, talk about an organization as ‘innovative,’ ‘responsible,’ ‘creative,’ ‘progressive’ or ‘committed’ functions as a top-down guideline or manifesto to frame organizational purpose and behavior.
Organizations create the mythologies that, in turn, create them. Like a Catch 22, a self-fulfilling prophecy or that guy who so desperately wanted to eat steak that he was willing to be plugged back into The Matrix, the more that a mythology is verbalized, marketed, branded and put out into the world for consumption, the more it is up for constant and continual subscription by anyone who has access to it. There are employees who understand this; behind closed doors, in quiet whispers of dissent or a conspiratorial nudge-nudge wink-wink, some can articulate how what their company says to others or to itself is a boast that exceeds what they are. It sounds somewhat juvenile, but these organizations resist conducting internal insights work because they do not want to get caught in the boast. Others who resist generally do so for one of four other reasons: lack of understanding, anti-intellectualism, loyalism and neurosis.
It’s a big leap – sometimes a scary one – but arriving on the other side clearly positions the jumper in a new realm of possibility, opportunity, clarity and competitive advantage.
If an organization is neurotic, it resists developing insights into its own psyche. No one wants to admit that they’re dysfunctional, destructive or not that good at what they do. Like a junkie entering the final scene in an episode of Intervention, many organizations exhibit a blood-curdling resistance to the thought of facing what they think might turn out to be bad news, criticism or a bursting of the bubble. Here, knowledge of self can be scary.
If an organization is driven by loyalism, it resists developing insights that might be applied to improving the lot of others in life. Because the corporation is first and foremost loyal to itself and its shareholders, most would rather ignore the value and opportunity presented by self-examination and do everything in their power – like lobby Congress to block changes to ingredient labeling in products that might be considered unhealthy for consumers – to maintain a status quo that benefits them alone. Here, knowledge of self could be expensive.
If an organization is anti-intellectual, it resists developing insights that require deep investigation or analysis based in theory. It’s not that such organizations selectively suppress their internal intelligence. It’s just that many of them have, over time, engineered themselves to think, process and produce in very rigid, industrial-age ways. A by-product of the ‘optimize & control’ model used to identify and leverage new opportunities, the gates of practice are so closely guarded that new knowledge, new ideas and new ways of thinking cannot slip by. Here, knowledge of self could be disruptive.
Finally, some organizations resist developing internal insights not because they are neurotic, opposed to meeting real consumer needs, or just plain dumb. They resist them because they don’t quite understand the value, the process and the outcome.
The value proposition of conducting internal insights work is clear. It is perhaps best summed up by Arie de Geus, former Corporate Planning Director at Royal Dutch Shell and author of The Living Company: Habits for Survival in a Turbulent Business Environment and The New Workplace: Transforming the Character and Culture of Our Organizations. According to him, “Your ability to learn faster than your competition is your only sustainable competitive advantage.”
Describing the most enduring companies as those that treat their enterprises as “living work communities” rather than just economic machines, de Geus argues that the capabilities for more effective management, innovation and growth lie in cultivating knowledge to tweak or transform the decision making process. One stream of knowledge, about the outside world of the market, can be cultivated through strategic foresight and long-term scenario planning. The other stream of knowledge, about the inside world of the organization, can be cultivated through self-analysis. Both are valuable, but only one is truly proprietary: knowing thyself.
Among the ways to know thyself, organizational ethnography offers the most qualified lens to examine and analyze this idea of a living work community. By inviting anthropologists, sociologists and/or human factors specialists into the workplace and giving them both interview and observational access to meetings, workshops, work-in-progress and employees, organizations can benefit from uncovering new knowledge. This new knowledge includes: the cultural, emotional and cognitive dimensions of an organization that do not exist in manuals but only tacitly; the relationships between actors within the structure of organization and how they claim, conceive of and enact knowledge; the role that language and practices play in reinforcing behaviors; and, when employees are allowed to speak freely about what’s wrong, what’s right and what they wish would be, the underlying story that the organization wants to, or could, tell itself and its consumers.
The outcome is not a deliverable. A deliverable is a deliverable. The outcome is new knowledge that empowers through actionable insights: the role, impact and communication of organizational mythologies and how they can be reevaluated and re-shaped to allow executives to develop faster and more effective change strategies; opportunities for greater collaboration and cross-functional learning; principles and practices that are not, but should be, aligned with organizational intent; how space, tools and technologies influence creativity and productivity; why and how valuable employees and ideas are being internally stifled; and the introduction of ongoing learning and discovery as part of every day work.
Armed with some advice from the 10th century and some new knowledge from ethnography, organizations can escape their selfimposed, industrial-age exile and join the 21st century. It’s a big leap – sometimes a scary one – but arriving on the other side clearly positions the jumper in a new realm of possibility, opportunity, clarity and competitive advantage.