Snakes & Ladders: Status and Rewards in Organizations
From Throwingsheep
Many people tend to believe that others get jobs through family connections and friends, and owe their advancement in organizations thanks to the protection of mentors, not due to merit. These attitudes cynically regard the competition for status and its rewards as a rigged process.
While this stereotype is not strictly true, neither is it always wrong. Merit is not always recognized in organizational settings as a criterion for career advancement; and frequently we are left baffled as to why certain people rise in the system, and sometimes even getting appointed CEO.
One of the major themes of Throwing Sheep in the Boardroom is that the Web 2.0 revolution has democratized status. Thanks to the horizontal, transparent and ubiquitous nature of Web 2.0 social platforms, efforts to achieve recognition, rewards, and status are now evaluated on the basis of merit.
As the countless examples of talents discovered on MySpace and YouTube demonstrate, fame on the Internet is a real-time, direct global democracy in action. Never before has it been so easy to become so famous so fast. You don’t need an agent, a publisher, a music label, a movie studio, or a television network. Anyone can upload their work directly on MySpace, YouTube, their own blog, or onto countless other social sites. Their shot at fame will be judged on a global Gong Show on which the curtain never comes down.
The Web 2.0 revolution has radically reconfigured the values that attribute status – or social capital. In the real world, status is conferred by institutionalized position. In the online world, status is assigned on the basis of performance. In cyberspace, status is not assigned, it is earned. Status in the online world moreover is based not on values, but on facts – the measurable facts that that attest to expertise, efficiency, and effectiveness.
Web 2.0 tools in organizations not only encourage horizontal collaboration, they are also transparent, which makes it obvious to everybody who is contributing to a task and moreover whose contribution is the most valuable. Web 2.0 tools also make it possible to seek out expertise that was previous “hidden” because nobody in the company previously called upon a certain person to collaborate on a problem. Thus, expertise is not only sought out, it is justly rewarded.
The virtue of Web 2.0 firms – or network organizations – is that they eliminate the rigidities of formal hierarchy. The advantage of network organizations is their adaptiveness and capacity to innovate when faced with change and uncertainty. The network organization is like the Internet -- lacking a controlling centre but functioning as a platform for collaboration, innovation, and creativity.
Web 2.0 tools -- blogs, wikis, social networks, mashups, social bookmarking, RSS feeds – construct open-ended platforms on which, in theory, everybody is equal. Collaboration is a horizontal democracy, not a vertical hierarchy – and status rewards are distributed accordingly. The person who has the winning brainwave might be a low-level employee working in the bowels of the company; or may indeed be a customer located outside of the corporate walls.
That, at least, is the theory. In truth, the democratization of status inside traditional organizations has been challenging. Traditionally, the social architecture of corporations has been vertical and closed. Corporate cultures are shaped by rigid hierarchies and ascriptive values of position, title, and rank. Corporations are managed as top-down organizations. Managers and employees who monopolize key functions, and reap status and rewards, accordingly, are generally hostile to any technology-driven pressure to radically reform the status quo.
Also, inside corporations there is a tendency for managers to work with, and reward, “lovable fools” instead of “competent jerks”. Rationally speaking, when tackling complex problems one naturally has an interest in calling on others whose expertise makes them most qualified to collaborate. In fact, however, people invariably choose likeability over ability. In most organizations, employees prefer to work with others who share their own values, attitudes, and ways of thinking -- even if they don’t possess any demonstrated competence. Even when they are more or less incompetent. Conversely, employees tend to avoid, and marginalize, those who are considered unpleasant – even if they possess excellent technical expertise that could be indispensible to solve a problem.
This finding, clearly, can have serious implications for organizational performance and efficiency. The tendency towards working with “people like us” creates an echo-chamber syndrome where managers hear only the familiar reverberation of their own biases. Echo chambers, we know, frustrate innovation and creativity because they discourage innovation, creativity, and openness to change. Echo chambers are heavily biased in favor of the status quo. The exclusion of competent jerks means that valuable expertise goes untapped. It also frequently means that genuine expertise and merit goes unrecognized.
Deployment of social media like blogs and wikis may be great for employee satisfaction and shareholder value, but they threaten entrenched status hierarchies. Web 2.0 tools blow up corporate silos, knock down bureaucratic walls, drain organizational moats and swamps. Many corporate executives, far from seeing the tremendous potential of Web 2.0 for productivity, innovation, communication, and recruitment, still regard social media as a time-wasting distraction. Most of all, they see Web 2.0 tools as a threat to the status quo. If Web 2.0 builds ladders to recognition and status in organizations, most corporate hierarchies are still infested with snakes.
We need further concrete examples of status attainment and rewards inside organizations in order to measure the success, or failure, of Web 2.0 tools in corporate environments. Are there examples of Web 2.0 that mimic the “fame game” effects of social media like YouTube – i.e. where employees are discovered and promoted for their genuine expertise? What are the best Web 2.0 tools for promoting status attainment inside organizations – blogs? wikis? others? Also, are there noteworthy examples where corporate managers have demonstrated reactionary behavior towards attempts to use Web 2.0 tools to seek and reward expertise according based on merit and performance?
What are the success stories and examples of pitfalls?
