At the Google Zeitgeist conference this September I interviewed Best Buy CEO Brad Anderson about his efforts to accelerate the company’s growth strategies through the use of social media. We often think of social networks, wikis and the like as impacting only marketing or the media, but Best Buy is a great example of how they can fundamentally transform the enterprise and the art of management. And in so doing unleash new productivity, creativity and a smarter customer experience. I think Best Buy is a leading indicator what businesses will start to look like in the near future, which is why I found Anderson's insights so relevant.
I’ve been fortunate to have a front row seat to many of these developments: our company, The Conversation Group, has worked closely with Best Buy’s VP of Internet Strategy Michele Azar over the last year on implementing some of these changes and fostering an open, collaborative approach to partners, employees, customers and developers. The talk with Brad opened with a short video highlighting much of what Best Buy has been up to: click on the player below to view my entire conversation with Brad Anderson, starting with “the company as Wiki.”
I first asked Anderson how a company that grew up in the distribution and product availability world came to adopt social networks, predictive markets, and an open approach to innovation and cooperation. Traditionally, we associate companies like this with classic top-down management approaches. Brad points out that as their business challenge shifted from simply distributing product to insuring customer delight under countless usage scenarios, only a method that tapped the wisdom of everybody made sense.
click here to view
Flips The Role Of Leadership
Next we discussed the impact all this had on traditional management and managers. Brad told me that it “absolutely flips the role leadership” since great ideas often come from the edge, not the brass. And, all this “ can be murder on middle management”
click here for Brad's comments
The Perfect Storm
One reason Best Buy provides insight into management to come is the perfect storm of a workforce and business challenge faced by Best Buy. The company has 170,000 employees, most of them of the under 30 net-generation that grew up with collaborative technology. They go to work every day solving technology problems for customers, where they are all potential experts. In retail, Brad told me, “You are exactly as motivated to deliver service as you feel like you are engaged in the work… so if you can create your job, you’re a lot better off!”
click here for Brad's comments
Next we discussed some specific projects: the “Loop Marketplace” which replaces the suggestion box with a market where employees can submit and share ideas…and often get them funded. And a prediction market (like a stock market simulation) that was dead-on in predicating Christmas sales because, “It reveals insights in the system that aren’t captured by the hierarchy.”
Blue Shirt Nation: The Best Buy Social Network
Here we discuss Blue Shirt Nation…the employee social network which was build by Steve Bendt and Gary Koelling in the advertising department to garner customer insight from employees. But from the moment it was turned on it was clear that employees would call the shots on this system and define how it would be used.
Click here for brad's comments
Self Organizing Work
One of the most dramatic examples of using a social network like Blue Shirt Nation to surface employee talents and enthusiasm is the case of The Employee Tooklit. When the IT system that employees used in store was getting tired and old, six employees (who turned out to be very talented computer geeks and coders) came to corporate and rewrote the system themselves in six week for a couple hundred thousand dollars (spent on pizza, coke, and hotel rooms.) All to the astonishment of the company’s IT consultant who said the project should cost $6,000,000 and take the better part of a year. Talk about unearthing hidden talent and creating new career paths for your employees!
Brad talks about the fact that when you start using social technology to connect employees, everyone become a lot more aware of each individuals talents and stories. And this can lead to a lot more productivity and creativity. This has become something of a mantra at the company, under the mantle of I Am Best Buy. This thinking is beginning to affect strategy company wide. For example, this year's Holiday TV campaign is all about the highlighting the individual stories of Best Buy employees. It was shot by documentary film maker Errol Morris and blogged about here by Best Buy CMO Barry Judge. This is a direct example of how the "Company as Wiki" thinking is impacting the company's brand. By making the brand a lot more about people, it opens up up avenues for more social marketing in the future.
This theme of using the social network to tap unexpected employee talents shows up repeatedly. When employee participation in the company’s 401k plan was sub par, it was the employees themselves who took on the problem in a way that an HR department never could.
Click here for the the Case of The 410k Program
This has all lead to half the employee turnover Best Buy used to experience, and its also highlighted the importance of culture and values in management. In the days of top-down command and control, you could get away with telling employees what to do via procedures. When so many employees are collaborating, creating content, and inventing things only a shared culture to can deliver aligned behavior. Now, corporate values serve as boundaries and management tools the way process used to.
Brad's observations here
Mobile and The Customer Experience
The same activities that are being used internally, are now driving external customer experience, growth, and revenue generating activities. Best Buy employee Ben Hedrington articulates how the company's mobile strategy might evolve, and Brad comments on why Best Buy is increasingly in the customer experience business.
View the conversation here
Brad observed that while Best Buy is just at the beginning of deploying systems that tap the networked wisdom of its people, this is clearly one of the most powerful growth strategies he's ever encountered. The collective knowledge of customers, suppliers, and employees can lead to both a more informed customer support and relationship experience, as well as a better retail experience. The company initially grew by opening several thousand stores. Now there is the opportunity to open thousands of virtual stores, tapping the experiences, networks, and insights of its many people.
As we wrapped up, I showed brad a clip an employee at the Best Buy call center as she used Twitter to monitor the lousy experience a customer was having at a competitor, and how Best Buy intervened. Brad talks about the future and about how much more fun and productive enterprises will become as they move from top down, command and control to actually tapping the capabilities and networks of employees and customers.
In spending time with Best Buy over the last year, its been interesting to watch how consciously they've been wrestling with the meaning and impact of collaborative technologies. They've realized that the best ideas bubble up, emergently.So management doesn't dictate what's gonna work, it has to listen for it. And then nurture it. There is also a darwinian aspect to all this: Best Buy has allowed for a large number of experiments to happen and then resources the ones that work. Not quite ever having enough resources forces collaboration between the various teams working on projects as they need to come together in a broader strategy. And the CEO himself has been recognizing and highlighting this success, which creates a culture if innovation even in a company facing the incredible challenges of today's retail environment.