A very important view of the future

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In three years writing regular editorials for the CRM-Forum, occasionally one seems to strike a nerve that stimulates way above normal response from readers (average readership of my editorials over the three years is just over 5,300). A few weeks back, Why Marketing isn’t working any more (published 17th Feb) was just such an editorial. It has already been read more frequently than any other editorial I’ve written. It obviously struck a nerve with many of you, even if it is more a cry of exasperation than a serious bit of analysis, so it seems likely that many of you have a similar unease about current marketing effectiveness. Something funny is going on, and I’d like to give you a number of pointers that might help understand what that is.

Before that, however, it strikes me that a list of those editorials which have ‘struck a nerve’ might be useful, so you’ll find a table of all those which have been read more than 10,000 times below. They also tend to have a large number of valuable comments from members, which adds to the interest. Most of them are still relevant today, and so worth reading or even re-reading:

So why isn’t marketing working any more? Here on the CRM-Forum I hope we provide some useful pointers. Alan Mitchell, with his two books (see BCCF Resources for links to them), has put serious thought into the issues, and articles by him, including A buyer-centric world and A comparison of buyer-centricity, customer-centricity, and customer-managed relationships (CMR) amongst others provide an overview of his thoughts. Prism Services survey of UK business, Buyer-Centric Markets Survey 2002 Summary and Recommendations, provides an overview of how some UK markets are responding to the challenge. Scott MacStravic’s article, A New Typology for Buyer Centric Commerce that we publish this week provides a variation of the buyer-centric view, which Scott calls consumer success sharing. I have tried to provide my own view of some of the trends in two recent editorials, Strategic challenges for RFS from online banking, and how to meet them and How to succeed in the emerging business-consumer marketplace.

However, this week, I want to point you at a different, related, concept. Chris Lawer, strategy and consultancy director of Conciera introduced me to a book called The Support Economy: Why Corporations are failing individuals and the next episode of capitalism (Prof. Shosana Zuboff and James Maxim), and I’d like to provide you to an introduction to it. However, I have a slight problem. I haven’t read the book (it isn’t published here in the UK until 24th April). However, I’m convinced it will be an essential read for all our members interested in how CRM, buyer-centricity, or whatever is likely to develop. Why?
The book argues that over the last two centuries an increasingly efficient economy, coupled with a rise in democratic thinking and growing access to information, has opened up life's possibilities to increasing numbers of people. Because participation in the consumption-based economy is unavoidable, the general public looks to markets to provide "deep support" in their quest for individualisation, but "are routinely punished for being complex psychological individuals in a world still fitted out for the old mass order." This macroeconomic structure treats people as either employees or consumers and inevitably hurts their feelings. Zuboff and Maxmin would eliminate the "little murders" of customer service interaction by replacing the current transaction-based model with a form of "distributed capitalism" based on a customer-supplier relationship, so semi-anonymous customer service reps will be replaced by "advocates" fully emotionally involved in their clients' needs. The first part of the book is a detailed examination of why managerial capitalism has reached the end of its useful life. Zuboff and Maxmin say that because the system is out of date it cannot serve the needs of today’s consumers. They also say that its inward focus results in scandals like Enron because managers think the company is there to serve their needs. Managers are at the center of the system and value is inside the company. All of this was ok for making things but failed to deliver good service because it was not designed to do this. The second part of the book follows the logic of the demise of the management system. Here value goes outside the company and rests with individuals (it is distributed) To achieve alignment everything else (control systems, ownership etc) becomes distributed and wealth is realised by allowing people to live life on their own terms- by providing them with “deep support”. Here the technological and organisational vision is revolutionary. You need to forget all you have learned and think about capitalism from the ground up.

How do I know this, without having read the book? I’ve learnt from my peers by reading reviews of the book on Amazon.com and constructing the overview from those comments. You can find all the comments here:
Let me give what I hope is a balanced summary of reviewers’ comments:

• Last year I retired from a consulting practice that I built up over 30 years. During that time I advised clients on a wide range of activities and sold literally millions of consulting hours. Once I started reading this book I could not put it down. Every page was a new revelation. Prof Zuboff sets out a line of argument that is both factually and emotionally compelling. She took the blinkers off my eyes;- they had been there for 30 years. I suddenly saw business in a new light, I saw potential that I had missed, I saw what customer centric really means. Their idea that control, value, cash etc leaves the company (centre) and is distributed is profound. It points the way to a new economic model. They provide a powerful framework to think about the future.

• This book challenges the way business is done today and offers a sane, plausible and compassionate alternative - one that makes real economic sense. Zuboff says that we are burdened with a logic that was invented by Henry Ford- one that has run it course, served its purpose well and is now ready to be replaced. The notion that this will be though a form of distributed capitalism is truly insightful and opens the way for a new debate. This is a masterpiece.

• If anyone could benefit from some exposure to the real world let it be Shoshana Zuboff. While many of her points are insightful, and ring true about the state of institutions, nothing is offered as an example of just how one goes about changing the present state of affairs. And, after spending some 30 years in the corporate sector, a lot needs changing. However, read the book as it does have some interesting points.

• The Support Economy stands out from most books about business because it is rooted in history and explains the cause (not the symptoms) of many of today’s problems. The idea that value no longer resides inside the company but outside it (is distributed) is fundamental to Zuboff and Maxman"s argument. It may seem radical but it also makes sense; - people have played with this idea without being clear about it. This idea sets the stage for a whole new view of the future, where the money is, how cash moves and what technology can do. Support of the individual (you and me ) becomes the goal and products and service are part of support. Control, ownership and IP follow value and become distributed.... the peer to peer techie delight. This book will stand the test of time and is brave and bold invitation to look at the big picture rather than next week.

• Even though this work is written by two colleagues who have pursued successful careers in the corporate environment, one senses that it should be classified in the domain of science fiction. It is both a lagging indicator and a conservative vision in didactic format. Even though the authors attempt to portray a sensitive and connected community, one feels like the new consumer will be as helpless as royalty, their every need instantly anticipated by an army of servants, flesh and digital- the ultimate pampered consumer, looked after because that creates the new world of work. Missing are those slaving in the depth of this utopian castle, those who have to grow the food, build the technologies and deliver the goods. Missing from this volume is the economics of a global society that provides the platform for delivery of these services. The work is one dimensional and extrapolist, seen from the back seat of a corporate limo, or somewhere above the "glass ceiling; a world that does not realise that there are workers in the shirt factories of Bangladesh whose daily wages will not afford them the luxury of bus fare across town to their shanties that are without basic sanitation.

• The Support Economy sets out in the clearest possible detail why the existing form of capitalism has reached its adaptive limits and what the new form will be. As an economist I could be critical of some of the details that Zuboff and Maxmin layout. That would only devalue the masterpiece that they have written. The sheer intelligence behind this is enough to humble most people- but this is supported by scholarship and a deep and practical experience of how business and companies work. This makes the arguments relatively simple to follow. But you then get their description of the ' new ' enterprise logic and the nature of distributed capitalism and you truly have to think in different ways. Your imagination is put to the test. This is no different however that the leaps in thought that went with Henry Ford. The move from transaction to relationship economics has been discussed by many people but Zuboff and Maxmin give credence to the argument and ground it in a new reality.

Now, without reading the book, these divergent comments from my peers, and the language in which they are expressed, convinces me that even though it is unlikely that the book provides the complete answer, it’s an important contribution to the debate. I’ve ordered my copy. If you’re interested in why marketing is no longer working and how CRM is likely to develop, I suggest you order a copy by following this link: The Support Economy: Why Corporations are failing individuals and the next episode of capitalism. I hope it goes without saying that I have no commercial interest in the book or Amazon.com.

One final point is this article, recommending a book that I haven’t read, based on the comments of ‘my peers’, one pointer to how the new economy is developing?

As always we’d like to hear your comments. Make them below or email me at mailto:[email protected]

Regards,

Richard Forsyth

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