Some people say we’re just at the beginning of this vast business transformation caused by the web.  Others say we’re almost at the end.  

The truth is, we’re almost exactly in the middle.  

Let me explain.

A major driver of business transformation is the enablement of a real-time conversation between: a) customers individually and en masse, and b) the companies that serve them.

Actually, a better word is ‘among’, rather than ‘between’, since the conversation is really three-way: customer to customer; customer to company; and company to customer.  

No news here, right?

OK. To exploit the full potential of these real-time conversations, companies have to develop three capabilities:

  • Interact. Learning how to foster and participate in the conversation.
  • Listen. Learning how to harvest information and insights and get it to the people inside the company who need them most.
  • Respond. Learning to respond as an organization; not just a reply, but changing your products and processes in real-time to better respond to the needs of the marketplace. 

How long will it take before every company has these capabilities? It’s a fair guess that any transformation this big will take about a generation to complete.

Some people and companies will learn and adapt, others will cycle out of the workforce or industry to be replaced by other people who will learn and adapt.

Date the start of the transformation at, say, 1995 – the birth of the commercial internet – add 30 years, which is roughly the length of a generation in developed nations, and you have a time frame from 1995 to 2025.

I know, 30 years is a long time. But remember, we’re talking not about how long it takes one company to change, but about entire industries  – from early experiments through universal adoption.

Technologies change quickly. Individuals change quickly too, though not as quickly as technologies do, and institutions like companies (those bundles of culture, policy, process, and physical and digital infrastructure) change very, very slowly.

Some companies will move faster, others slower, but this is how long to take everybody to get there. 

Let’s also assume that companies acquire these capabilities roughly in that sequence – interact, listen and learn.  Because, logically, you can’t listen until there’s interaction and so on. 

Finally, just for neatness sake, let’s say each phase of learning takes about a decade to complete: interact runs 1995-2005, listen from 2005-2015, and respond from 2015-2025.  

So how does this comport with what we’ve seen in real life? Pretty close, as it turns out. In the early years of the commercial web, companies focused on building communities – essentially, they were trying to make that interaction happen.

There was a lot of failure in those days, because companies lacked the knowledge and experience.   

Today results are better, for two reasons: first, a base of knowledge developed over the first decade in how to make communities work. I always say that when I started community building in 1999, it was really a big guess – companies just hadn’t done a lot of this work before.  

Today, by contrast, if the numbers work – that is, if your target audience is large enough – and you do ten things right, it’s difficult to fail (which isn’t to say that it’s impossible, in part because those ten things can be devilishly difficult for some companies to do right).

Second, with advent of social networks like Facebook and Twitter, interaction around brands is already happening in ways it wasn’t ten years ago. Although anyone trying to drive the right kind of interactions, on Facebook or elsewhere, know the battle isn’t over.  

So the lessons around interact are largely in the books but where are we with listening? I don’t think anyone has been immune to all the buzz around social media monitoring over the past few years.

Companies are focused on aggregating all the conversation happening out there on the web – “full firehose,” anyone? – but aggregation in fact is just the first step in listening. Next, you have to filter all that content in order to get the content you’re actually seeking.

Then you have to get that filtered content into the hands of the people who need it. Sometimes that means piping the content into social dashboards, hubs, or reporting interfaces. Increasingly, it will mean piping it into workflows, reporting interfaces, and data stores that people already use today to get their work done.  

So what about respond?

As with listening, everyone today is focused on just the first step; replying to customer service and support requests. But eventually, responses need to move from individual to organizational.

Business processes will need to change to factor in this new, real-time source of information and insights, which in turn will change business decisions and even the processes themselves. People in support will do their job differently because you have a social effort.

People who design products will do their jobs differently, too. People in market research, communications, quality assurance, channel management – every process will be touched by this stuff. The end state is one in which products and processes are dynamically created and refined every day in an ongoing conversation with customers.   

We see a glimmer of that future end state with the customer ideation efforts run by companies like Dell, Starbucks, and Verizon in the US, and BT and giffgaff in the UK.

These companies are saying: “Tell us how you would change our products and services. Show us that it matters, by voting up the best ideas. And if you do those two things, we’ll do our best to make your changes happen”.

It’s a pretty gutsy move, and only strong leadership and good cross-functional coordination makes it possible. Frankly, that’s why you don’t see more of it today.

A decade from now, we’ll wonder how any company did without it.