The Strategic Role of Digital Networks in Corporate Leadership Today

While there are a number of key factors that help organizations create important new types of business results using enterprise social networks or online communities, leadership is almost always at the top of the list.

There is no avoiding the fact that what executives and middle managers actually do when it comes to leadership with digital networks has a inordinate determining effect on whether workers usefully employ social tools in their day-to-day work, take unique advantage of what makes them special, and create meaningful new levels of business value.

I’ve studied or helped organizations apply the key adoption factors of social business for years, and there’s a key question that still seems to come up as frequently as ever:

What exactly can leaders do to enable their organizations to incorporate the vital concepts and work techniques of digital networks into their daily work?

It turns out that enablement of the overall underlying concept, social business, by corporate leaders requires some of the same key skills that made them top managers in the first place: Effective communication, the ability to get others to follow their lead, the ability to formulate a vision and inspire others with it, getting things done, and perhaps most of all, the ability to encourage others to help carry out positive change.

Sidebar: Study a thumbnail sketch on the concept and progress of social business.

Leadership today also requires a set of attributes that many managers usually do not yet have today: Knowledge of and skills with modern digital collaboration tools, and their techniques and strategies. As my industry colleague Cerys Hersey recently noted, the enterprise social network is becoming our corporate ‘operating system’, at least in a significant — and steadily growing — percentage of large organizations today.

Related: What Are the Required Skills for Today’s Digital Workforce?

Comparing Traditional Leadership with Network Leadership

The full and compelling motivations for using a social network as a foundation for how a modern corporation operates is beyond the scope of the analysis here. However, I’ve explored it in detail recently on ZDNet, and the short version is that it enables truly engaging employees, helping them work together in improved ways, tapping deeply into their knowledge to enable widespread learning, scaling work processes in new and potent ways, creating richer/better institutional practices, and capturing a highly differentiating corporate body of knowledge, among other known benefits.

So, of all the new skills that executives have to learn today, perhaps the most important isnetwork leadership, which the conservative and well-respected Executive Board recently pegged in their report, The Rise of the Networked Leader, as a major new evolution in management skills, which can contribute up to twice the profit growth in organizations which have the most effective leaders:

Analyzing the relative performance of more than 3,000 leaders, CEB has found that organizations with the strongest leaders have double the rates of revenue and profit growth compared to those with weaker leaders.

Unfortunately, many organizations and their leaders struggle to meet these mounting demands; those who struggle are hard pressed to maintain their advantage as the work environment changes and the nature of leadership in the new work environment shifts. CEB research shows that many leaders are poorly equipped to thrive in the new, rapidly changing work environment.


The lesson here is that it’s now urgent for executives and managers to acquire network leadership skills in order to succeed in today’s modern work environments, rife as they are with many new types of digital collaboration environments that can help them wield outsize leadership influence, which they can use to then orchestrate high-scale performance improvements for their organizations. Beyond the usual corporate focus on revenue and profit, which network leadership can deliver in potent and innovative new ways, network leadership also fosters a fundamentally better, more aligned, and more satisfying workplace for everyone.

As Altimeter’s Charlene Li, in her examination of how digital is remaking the styles, techniques, and even the very culture of leadership, singled out in her best-selling new book The Engaged Leader, notes that:

In order to be truly effective today, leaders in business and society must change how they engage, and in particular how they establish and maintain relationships with their followers in digital channels.

The good news is that top corporate executives are realizing the imperative of leading through digital channels. There are now leading examples of network leaders from highly respected organizations around the world, including business luminaries such as Richard Branson, Rupert Murdoch, Mark Bertolini, Marc Benioff, Marissa Mayer, and even Harvard’s Bill George, though there are certainly still considerable differences in digital engagement depending on corporate responsibility.

So, to understand exactly what top network leaders do in enterprise social networks, let’s examine the patterns that are emerging in what leaders do, day-by-day, to cultivate and exert effective network leadership in their organizations, and even outside of it.

Create Reach: Cultivate Network Capital

Network Leadership | Step 1: Cultivate Reach and Social CapitalGetting an organization to engage with an executive over an enterprise social network can be straightforward if you’re a well-known and/or well-liked leader. But most executives will have to work fairly diligently on building a network of followers in the organization. Over time, these individuals will pay a growing amount of attention to them communication and value steadily flows from the executive through their daily activities. And that’s just internal cultivation of network capital. It can be much more work to gain a relevant network following on the other major arena: Out on the Internet. In its simplest form this is gaining followers interested in your industry work on popular social networks. More meaningfully, it becomes the entire set of online conversations, group activities, and concrete value streams that have your professional social identity connected to them in some way. Fortunately, there are plenty of resources that can teach executives the necessary skills. In particular, reverse mentoring programs such as at Bayer Material Scienceshave been known to be particularly effective at helping executives rapidly acquire the necessary skills.

Be Transparent and Communicative: Working Out Loud

Network Leadership | Step 2: Working Out Loud on Social NetworksSocial networks only become truly powerful business tools when executives start to set their knowledge free to work out in the network, 24 hours a day. Leaders must also build authentic and meaningful conversations with other stakeholders on the network, and so the currency of lightly narrating your work activities on social channels, including what you’re doing and what issues you are facing is considered a key network leadership technique. Cultivating these digital habits will have the benefits of automatically creating more transparency and a shared understanding of what the organization is actually facing at an executive level. Working Out Loud can also directly improve employee engagement, which can be low particularly because meaningful ongoing storytelling is often missing in large organizations, despite inclusive corporate cultures being widely regarded as drivers of high performance. This narration process, which can be usually be accomplished in the margins of executive schedules, also becomes the basis for building even more social capital, as well as enlisting the organization to help just-in-time with key issues, as ideas and solutions have a strange way of coming from where you least expect it. You can learn more about Working Out Out from Deutche Bank’s John Stepper, who has long promulgated it.

Engage on the Network Regularly: Stay Involved at Multiple Levels, Channels

Network Leadership | Step 3: Regularly and Proactively Engage on the NetworkAs one might suspect, just narrating your own work is not sufficient to be a network leader. One must also track key conversations and work streams happening within your networks and social followings. While there’s no way to keep track everything that’s happening, most enterprise social networks have volume controls and filters to let you focus on what matters to you at the time, such as what particular teams, projects, or even people are doing, while still making sure enough serendipity still occurs. It’s important to stay involved at a sustainable pace at multiple levels in the organization across the key digital/social channels, as it’s long been understoodthat diversity of information and stakeholders creates the most vibrant and useful knowledge networks. Opportunities for doing more within network, as well as learning about the organization — and perhaps most of all about your customers — faster than ever before, soon become obvious.

Related: What Network Leaders Should Do About Customer Communities

Work Through the Network: Orchestrate and Co-Create

Network Leadership | Step 4: Orchestrate and Co-Create Through the NetworkOnce a leader has sufficient network capital, along with involvement and credibility within various digital networks and communities, they can begin to more actively wield their influence and leadership strategically over the network. What’s more, this engagement can scale far higher — and much faster — than traditional relationship networks, which is one of the key benefits of digital/social.

Leaders can also use networks to proactively enlist stakeholders in driving successful change, seizing business objectives, solving vital problems, and harvesting needed innovation, or even just getting important work done. Executives can maintain corporate alignment across a highly diverse workforce, while directing the co-creation of solutions to the issues of the day. What’s fascinating is that these activities don’t tend to put much of an additional burden on the workforce because of two sources of headroom: Many employees aren’t fully engaged until their leaders work more closely with them, and most organizations have a significant cognitive surplus. So while network leadership is fundamentally about moving towards improved engagement with your stakeholders, it also has transactional benefits as well. Finally, if you’re still not sure about all this, the Collaborative Leaders Network has many compelling example of executives using collaboration and co-creation — many over networks — that led to better outcomes.

Use the Network to Learn, Then Optimize

Network Leadership | Step 5: Use the Network to Learn Then OptimizeAs I’ve recently pointed out in exploring how our organizations are heading towards a 4th Platform, networks are also the ideal place to learn, and from the learning to improve ourselves and our organizations. Enterprise social networks are therefore terrific environments to learn in the large, because most of the activity is out in the open and can therefore be analyzed for a variety of strategic business objectives. Leaders can also use their social networks for informal and unstructured learning, and getting ‘ground truth’ about what’s really going on and how things are actually accomplished within their organizations.


Fortunately, since nearly two-thirds of organizations now have the necessary networks internally, and 100% have the needed external networks (social media), almost everyone can get started on network leadership these days.

Note, however, that one key concept that is depicted in the visuals for each step above is thecapability of community management, an essential function to maximize the operational results of enterprise social networks. Community managers can also make the process of leaders getting involved and developing the skills, and even working through high value scenarios, far easier than it would be otherwise. Chances are good that your organization has people that do this, but if not, they can be found online with a bit of effort.

Lastly, this is a new journey and new management skill that we are all learning together as business evolves into more organically networked structures. There is little doubt in the value of network leadership, but the rule of thumb tends to be the more that you put into it, the more you and your organization will get out of it.

Ultimately, we now believe that the real question leaders must ask themselves is this: What will I do with this unprecedented new strategic management capability?

Additional Reading:

How Boards of Directors Can Prepare for Digital Transformation

How Social Networks Drive High Performance for Business

Adjuvi’s Services to Help Executives Prepare for Digital

Dion Hinchcliffe

Dion Hinchcliffe is a well-known business strategist, enterprise architect, book author, frequent keynote speaker, analyst, and transformation consultant. Dion works with the leadership teams of Fortune 500 and Global 2000 firms to drive successful change with new digital methods involving enterprise social media, digital business models, Internet ecosystems, workforce collaboration, and the future of work in general.

All stories by: Dion Hinchcliffe