Social Business, Google-China and Thomas Friedman

In a recent opinion piece in the New York Times, Thomas Friedman took a very provocative stance on the Google-China struggle, one that puts the free flow of information into a much broader context. Here’s the essence of what he had to say:

If China forces out Google, I’d like to short the Chinese Communist Party.

Where is he coming from? Well, like a lot of us, he see the command/control model of management giving way to the free flow of information and ideas fueled by networking and collaboration. There is a parallel here echoed by a diverse set of business leaders from John Chambers at Cisco to management guru, Gary Hamel.

Command/Control business management must give way to the power and potential of social business. By social business I include not just social networking on facebook but the deliberate collaboration and sharing that happens inside savvy companies and with a diverse set of external partners. This form of social business is fast and has less operational friction, but its real power comes from the innovation and agility to exploit new possibilities.

To make his point, Friedman quotes John Hagel

We are shifting from a world where the key source of strategic advantage was in protecting and extracting value from a given set of knowledge stocks — the sum total of what we know at any point in time, which is now depreciating at an accelerating pace — into a world in which the focus of value creation is effective participation in knowledge flows, which are constantly being renewed.

Finding ways to connect with people and institutions possessing new knowledge becomes increasingly important, says Hagel. Since there are far more smart people outside any one organization than inside.

Friedman says there are really two Chinese economies. Command China run by the Communist Party and Network China represented by the highly entrepreneurial sector that is exploiting the high-value flow of business knowledge. The former is a backward economy that can’t compete in today’s business climate (without the threat of force and control). The latter is represented by companies like Li & Fung, a $14 billion apparel company with a network of 10,000 specialized business partners where the daily flow of information leads to design and product innovation, leading-edge supply-chain management all fueled by the best global experts.

Friedman and Hagel both take positions that should not be taken lightly. For my part, I encourage people to back away from the trendy topics like Social CRM, Enterprise 2.0, collaboration and think about how the social dynamics they represent – open sharing, collaboration, collective intelligence and engaged participation – can help businesses thrive amidst the business dynamics of 2010. Command/Control worked well when the challenges were efficiency and stability.