Leading Workforces In The Sharing Economy
Paul Mason, in his article titled “The End of Capitalism Has Begun”, writes: “Without us noticing, we are entering the post-capitalist era. At the heart of further change to come is information technology, new ways of working and the sharing economy. The old ways will take a long while to disappear, but it’s time to be utopian.”
Readers of his column will see some similarities between Mr. Mason’s article and the case that I have been making; that a sharing economy should also be called Relationship Capitalism.
I concur with much of Mr. Mason’s article such as:
- The 20th century way of leading and operating business organizations is dying and new ways of working are emerging.
- Mason says “We have blurred the edges between work and free time,” says Mason. Because the formerly separate spheres of personal and business have fused together. Everything is “personal” today. Many of us now require our work to provide significance and possibilities for thriving.
- New technologies are advancing and requiring the change.
- The change is greater than just technology alone. Technology has enabled a new path towards progress. But the change also demands a change in mindset to leverage the benefits of technology.
- The transition to the Relationship Capital Economy has already started. The old traditional 20-century mindsets and approaches take a long time to recede.
All of the above points are valid. The area where I have difficulties with Mr. Mason’s article are:
The “sharing economy” is not a business? Mason conveys a romantic picture of the sharing economy. He states “We’re seeing the spontaneous rise of collaborative production”, “Goods, services, and organizations are appearing that no longer react and respond to the dictates of the market.” This is not true. Airbnb and Uber are still market-driven models. If they do not satisfy customers needs, they will not stay in business.
The truth is the “sharing economy” is an inaccurate label. Airbnb is a rental platform: homeowners are not sharing their homes out of affection for people: they are renting them to customers to generate revenue and a profit with the support of the Airbnb platform. It’s capitalism, not benevolence. There are markets of buyers and sellers and money changes hands. The correct term should be “renters” and sellers.
Relationship Capitalism Requires A New Mindset
Certainly, new mindsets and new approaches for comprehending and interacting with our hyperconnected and transparent world are needed to effectively deal with it.
What we are seeing at is not the end of capitalism, but rather the next stage of its advancement. The hyperconnected and hyper-transparent world that is materializing is still a market-driven standard that is unmistakably capitalism. The difference is the mindset of the customer. Since the formerly separate spheres of business and personal have fused. everything is personal. Just ask the 1.5 billion people on Facebook. If everything is personal, then personal responsibility and trust take on a new level of importance in the era of relationship capitalism. This is not some utopian view that removes the market-based rules for competitive success. It is just a more advanced and authentic form of capitalism by which stakeholders such and employees, customers, and partners can do the right things and achieve financial results.
Earning Relationship Capital (RC) is a Powerful Social Reward
To provide stakeholders within the organization and also the greater ecosystem with the ability to capture Relationship Capital (RC) in their business interactions fills a void; which has been the lack of a social reward. People and professionals from multiple generations generate and share free content and thought leadership on social media and receive likes, retweets, comments, etc.
Relationship Capital (RC) is an open standard of guiding principles and accounting of an entity’s credibility or quality of their trustworthiness with respect to these two types of social interactions:
Commitments and Perceptions are captured and scored as Relationship Capital Points or RCPs. Each Entity has a Relationship Capital Account in with RCPs are debited or credited. Keep a commitment and your RC account is credited with an RCP. If you do not keep your commitment, your account is debited.
The gamification of commitment and accountability with the open standards of Relationship Capital is a natural evolution in the advancement of relationship capitalism.
Making and keeping commitments is fundamental to earning RC and high-performing leaders and businesses have always understood this. The difference today is the hyper-connected and transparent social world we are in, the speed by which other’s perceptions of you, your product/service, or business is not only very fast but is amplified by brand advocates “word of mouth”. The measurement of an entity’s Relationship Capital (RC) is a results-oriented process.
Your Relationship Capital (RC) Leaderboard
There are different ways to display the RC you have earned through kept-commitment and RC that has been earned. High Priority commitments are “Red”, Medium commitments are “Orange”, and Low commitments are “Yellow”
It is Only the End of the Beginning for Business Leaders
This hyper-connected and transparent world of relationship capitalism is moving very fast. 21st-century management controls are no longer effective at getting the results you need to keep products and services from becoming commodities.
Relationship Capital Leadership is about putting your people in control and letting your shared purpose and values drive higher levels of performance that is underpinned by high relationship capital trust. Relationship Capital Leadership is about influencing and supporting a team of leaders and followers within your organization and across your entire ecosystem of customers, partners, and suppliers that will attract distinction, innovation, and financial performance.
To create and sustain your competitiveness in this world of accelerating change requires your team to see the opportunities as well as threats coming up them and proactively respond. Customers will not wait for you to develop the perfect business strategy, operating model, and/or launch the perfect technology platform when they want to make a decision. Your organizational culture must be smart, fast, and proactively act with good intent in the best interests of the customer/client and all your stakeholders. Your products/services must be at the right place at the right time in the customer’s decision-making journey.
A Relationship Capital Organizational Culture Has Benefits
- Attracts star performing customers & clients that will attract the attention and respect from other customers.
- Earns the respect of credible thought leaders and brand ambassadors who will share your story and recommend you.
- Attracts the star performing employees who share their high purpose and mastery with your organizational purpose to create amazing experiences not only with the customer & client, but also throughout your entire ecosystem of partners, and suppliers.
As you can see, today’s competitive battles are less about business entity versus business entity, and more about business ecosystem versus business ecosystem. This is a more peer-to-peer relationship that requires your business and your team to behave as a standard of trust based on shared purpose and values. Your stakeholders are watching.
As more and more leaders influence and shape their business cultures to adopt higher standards of purpose, mastery, and relationship capital trust, standing still will no longer be an option for the laggards. As more examples of Relationship Capital Mindset-Driven businesses flourish in their respective industries, the expectations and demands of your stakeholders will continue to rise. There is no end game, just a continuous journey of distinction through purpose, mastery and relationship capital. Leading your workforce effectively in the sharing economy of requires building relationship capital with them as well as with all key stakeholders.
What do you think? We welcome your thoughts and feedback.