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Venkatesh Rao
Venkatesh Rao
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Hard And Soft Power In Enterprise 2.0

Soldiers and diplomats recognize the power of the stick as well as the carrot. Time for E2.0 evangelists to toughen up.

Enterprise 2.0 evangelists make a key strategic mistake in how they frame their efforts: They adopt an "all carrots and no sticks" approach to Web-based business.

Soldiers and diplomats talk about hard power versus soft power. Hard power is all about guns, missiles, threats, and coercion. Soft power, an idea formulated by Harvard's Joseph Nye in the 1990s, is all about making friends and influencing people through cultural attraction, sharing, and cooperation.

Soldiers and diplomats recognize that you need both hard and soft power to exercise influence in credible ways. Somehow, Enterprise 2.0 evangelists miss this point. Don't believe me? I have proof.

Consider the most beloved words and phrases in the E2.0 movement: cooperation, collaboration, win-win, co-creation, delighting customers, social, word-of-mouth, authenticity, engagement, conversation, empowerment, strengths, true fans, tribes.

And consider the words that are conspicuously absent: winning, losing, out-maneuvering, competition, fighting, deception, coercion, exploitation, weaknesses, penalty, lawsuit, perception management, spin, inter-tribal warfare.

When you study the contrast in the two vocabularies, you realize that the E2.0 crowd has made a huge (and unintended) leap of faith. Apparently, blogs, wikis, and social networks have transformed human beings into angels.

This isn't a straw man criticism based on caricatures of Web 2.0 types. I routinely meet people with such ridiculously unbalanced and idealistic vocabularies of persuasion.

Sure, they're a minority, but they're not a marginal minority. They dominate the E2.0 conversation. I have managed to offend a couple of them so badly that they refuse to talk to me anymore.

Let's call them Carrotists. Though few Carrotists say so, their leap of faith stems from a belief in the myth of abundance--that social media somehow transforms all scarcity, the root of all economic and military conflict, into abundance. Ask and the universe shall do thy bidding.

From one defensible argument--Clay Shirky's notion of cognitive surplus, that there's more underutilized brain power lying around than we think--people somehow leap to a philosophy of peace and harmony in the world of business that can work only if everything that sparks competition and conflict, from oil to attractive people, were abundant enough to satisfy all.

This concept is not only deluded; it begs the basic question any business is designed to navigate: one that revolves around maximizing the value of some scarce set of resources. Without scarcity, there would be no enterprises to 2.0-ize.

There are both reasons and rationalizations at work here.

The rationalizations offered are based on idealist visions: empowered customers and employees living self-actualized lives and converting those oppressive capitalist pigs into suitably chastened believers in world peace. The pigs, so the theory goes, will eventually be humbled and won over by the grand drama of co-creation, altruism, and empathy that social business is supposed to be about. Lions will lie down next to lambs.

The meek want to inherit the earth. Today. Using peace and love.

The actual reasons are that, unfortunately, far too many Carrotists harbor feelings of oppression and marginalization, under layers of denial. It's revenge time, and E2.0 is the weapon of choice, in the effort to occupy the moral high ground.

Many smart evangelists speak Carrot-talk in public, but in private they have their doubts. They try to make things more realistic by being more rational, which translates to focusing on the emotionless aspects of business: numbers and ROI.

Now, there are many reasons the whole ROI conversation has turned into a bad joke, but one of the main ones, and the one of interest here, is that the Carrotists make a fundamental Psychology 101 mistake by turning to rationality. They think the hard-headed business types, the ones with all the power, are emotionless rationalists who will only be won over by fact-based arguments.

This is, quite simply, wrong. The prototypical hard-headed business types aren't emotionless pragmatists. They're as emotional and irrational as the Carrotists. If anything, they're even more contemptuous of the rational bean counters than the Carrotists.

Anemic rationalism and ROI-thinking are as alien to them as they are to the Carrotists. Faced with an ROI analysis, their eyes glaze over, too. These are the powerful line managers. The bean counters are mostly powerless staff types--people to get around rather than convince.

The hard-headed business types are simply driven by a very different set of emotions and irrationalities. Emotions related to the excitement of conflict and competition. Bloodthirsty emotions. Irrationalities rooted in too much confidence in their ability to win.

Let's call them the Stickists.

If the Carrotists hate the bean counters for attempting to reduce love and trust to dollars and cents, the Stickists hate them for staying away from the blood sport of building and selling products. The Carrotists hate the bean counters for their apparent lack of humanity. The Stickists hate them for their apparent cowardice.

Stickist E2.0 evangelists (I am one) exist, but they're rare. They like E2.0 for different reasons. Where Carrotists say that 2.0 levels the playing field, the Stickists say 2.0 levels the battle ground.

To Stickist E 2.0 types, the new communications and social technologies aren't about peace and harmony. They're about enabling asymmetric guerrilla warfare that lets anyone in any position challenge people with nominal power and big titles. Wikis are roadside bombs. Blogs are places to ambush your enemies. Twitter is hand-to-hand combat. Email is trench warfare.

You see, the "business is war" approach isn't a reluctant choice on the part of fundamentally peace-loving types. To the Stickists, "business is war" is what attracts them to the world of business in the first place. If the Carrotist utopia is about peace and harmony, the Stickist utopia is about constant conflict, a sense of urgency, an addictive cocktail of fear and excitement. To them, peace and harmony equals death by boredom.

These are people who pay more attention to threats than inducements; people who are contemptuous of those who offer feel-good validation to others, and even more contemptuous of those who actually need it. These are people who enjoy winning, watching competitors bite the dust, and persuading reluctant customers with psychological manipulation. They prefer win-lose to win-win. Even if they lose. They especially love big upsets--when a nobody takes down a C-suiter.

And when it comes to the front line of business, selling, these are people who at least partly view the customer as an enemy. Somebody to be engaged in a game of negotiation, where to win is to walk away with the better end of the deal.

Paradoxically, this attitude is actually more respectful of customers, one that doesn't insult their intelligence or capacity for independent thought. It's an approach that views them as full human beings with their own agendas and motivations, rather than intimate friends who are either in your "tribe of fans" or out of it. It boils the business of selling down to its essence: haggling. Only lofty cult-leaders refuse to haggle with their followers. Peers haggle.

These are people who suspect that any approach based on denial of this irreducible adversarial element in selling creates cults of consensus rather than thriving markets.

And they're right.

How do you get out of this unproductive framing? How can you make your E2.0 evangelism work a tasteful and artistic blend of Carrotist and Stickist thinking? How can you deploy hard and soft power in concert?

The key is to get away from the heart-and-brain frames (which lead to emotion-draining Kumbaya-and-ROI tactics) and move to heart-and-guts frames (which lead to emotion-amplifying Kumbaya-and-War tactics).

And the way to do this is to learn and enjoy the language that is alien to you. Carrotists need to learn to speak Stick-talk, and Stickists need to learn some Carrot-talk.

Venkatesh Rao is a writer and independent researcher at and the author of Tempo. He can be contacted via LinkedIn.

Note: An earlier version of this article incorrectly stated that World of Warcraft is a more popular game than The Sims.

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User Rank: Apprentice
7/25/2011 | 6:20:20 PM
re: Hard And Soft Power In Enterprise 2.0
Great article, Venkatesh - This gives a whole new perspective on how to talk about Enterprise 2.0. I really enjoyed reading it.
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