Hack:
Knowledge is Power: Disrupting Leadership Through Social Discovery

Since the advent of the Information Age, speed, agility, and innovation have become critical success factors for almost every business. While the larger population of leaders today have 1980s business training and practices—like long face-to-face meetings—the mathematics of information flow and a single person’s brain being needed for most decisions simply do not add up. Ultimately, the Information Age means more people can share their pieces of knowledge and wisdom (aka “grey matter”) in ways that ideas can collide almost on their own, without a single human conductor processing and assimilating all ideas.

The great news? If you have two or more people on staff, your business is already ready to move at the speed and with the agility needed in the Information Age. It’s all about activating and connecting the grey matter. The challenge? Information Age leadership shatters 1980s leadership models of the superstar leading the minions.

The realities of mass information and big data have rapidly exposed the central weaknesses in rigid management structures, where “leadership” and “management” are too often conflated as the same thing. The consequences of hierarchy are well documented:

1. Innovation Stifled. Innovation is a not a finite process or tangible resource like a standard business process. It requires creative thinking and proper stimulation. However, bureaucracy is no respecter of either. As most employees of any large businesses will tell you, the people with the most detailed exposure to key business problems often do not have the adequate authority to act on ideas for improving products or services. Thus, they have to pass the idea up the authority structure – if they ever get around to discussing the idea in the first place. Unfortunately, the most disruptive ideas can easily stall or simply disappear in the organizational structure. Unless stakeholders are particularly motivated, the vertical flow of ideas is typically extremely slow.  
2. Inefficiency Normalized.  Researchers have long been aware of how business hierarchy tends to inhibit corporate knowledge diffusion. Some have even noted that the rigid organization structures encourage centralization of important information (Datta and Chaudhuri). For leaders in rigid organization structures, the loss of key information, rework, and sub-optimal communication are often norms. When patterns of authority are pre-set inefficiency becomes, in some form or another, an accepted part of standard business procedure.
3. Ownership Decreased. While designating specific roles as sole decision makers helps maintain clarity, it also means the lower one is in the command structure, the less incentive they have to act on innovative ideas or correctional procedures. While the “frontline” employees often have the most practical understanding of how offerings and operations function, they have little perspective on the benefits of their knowledge and have little motivation to share these insights. This becomes particularly true in risk-adverse environments wherein the social costs of disruptive ideas often discourage any deviation from the norm. 

Intermediate Solutions

To compensate for these consequences, businesses have adopted different techniques for manager-leaders to deploy that encourage innovation within their organization. Some have adopted modified management structures (Armour and Teece); others have built performance incentives into their compensation plan to increase personal ownership of problems among employees (Dynes and Pierce). However, any hierarchical management structure ultimately has to deal with poor information flow.

Additionally, some artistic superstar leaders have figured out how to enable a listening and responsive environment. Such leaders, however, either struggle to explain their technique or to find explanatory language not immediately discounted by those who earned their MBAs twenty years ago.

It’s Still a Stop-Gap

Leaders within a business can only accomplish so much. Even fantastic leaders will not be able to access the knowledge potential of every employee. Information leakage is the inevitable result of relying on only a select few positions for decision-making. Leaders make decisions. Thus, leaders need data. It follows that the more people with data, the more who can lead; or, rather, the more leadership may be diffused, enabling more minds to decide from exponentially improving information in an upwards cycle.

Which therefore begs a simple question: does Information Age technology enable data to flow to those who can use it?

We have a hack that provides a resounding “yes”. The key is turning “ownership” of data from the few to the many, which means jettison of the middleman collecting and filtering the data, whether through managing by walking around or six week steno-pad interviews or board room speculations.