As we all know, organizational social-media literacy is fast becoming a source of competitive advantage. Here is a brief excerpt from an article co-authored by Roland Deiser and Sylvain Newton for The McKinsey Quarterly, published by McKinsey & Company. In it, they help their readers to learn, through the lens of executives at General Electric, how they and their associates can keep up in the six dimensions of social-media-literate leadership.

To read the complete article, please click here.

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Few domains in business and society have been untouched by the emerging social-media revolution—one that is not even a decade old. Many organizations have been responding to that new reality, realizing the power and the potential of this technology for corporate life: wikis enable more efficient virtual collaboration in cross-functional projects; internal blogs, discussion boards, and YouTube channels encourage global conversations and knowledge sharing; sophisticated viral media campaigns engage customers and create brand loyalty; next-generation products are codeveloped in open-innovation processes; and corporate leaders work on shaping their enterprise 2.0 strategy.

This radical change has created a dilemma for senior executives: while the potential of social media seems immense, the inherent risks create uncertainty and unease. By nature unbridled, these new communications media can let internal and privileged information suddenly go public virally. What’s more, there’s a mismatch between the logic of participatory media and the still-reigning 20th-century model of management and organizations, with its emphasis on linear processes and control. Social media encourages horizontal collaboration and unscripted conversations that travel in random paths across management hierarchies. It thereby short-circuits established power dynamics and traditional lines of communication.

We believe that capitalizing on the transformational power of social media while mitigating its risks calls for a new type of leader. The dynamics of social media amplify the need for qualities that have long been a staple of effective leadership, such as strategic creativity, authentic communication, and the ability to deal with a corporation’s social and political dynamics and to design an agile and responsive organization.

Social media also adds new dimensions to these traits. For example, it requires the ability to create compelling, engaging multimedia content. Leaders need to excel at cocreation and collaboration—the currencies of the social-media world. Executives must understand the nature of different social-media tools and the unruly forces they can unleash.

Equally important, there’s an organizational dimension: leaders must cultivate a new, technologically linked social infrastructure that by design promotes constant interaction across physical and geographical boundaries, as well as self-organized discourse and exchange.

We call this interplay of leadership skills and related organizational-design principles organizational media literacy, which we define along six dimensions that are interdependent and feed on one another (exhibit).

Our clearest window on the development of these new forms of literacy is General Electric, where one of us is responsible for leadership development. Witnessing GE through this lens is particularly interesting; unlike Google or Amazon, GE isn’t a digital native, and its 130-year tradition of reinventing businesses and itself makes it worth watching. So does GE’s status as a “leadership factory.”

GE’s commitment to social media is perhaps most visible through its digital platform GE Colab, designed by GE employees for GE employees to facilitate global teamwork and collaboration. GE Colab combines the capabilities of Facebook, Twitter, and other social applications, allowing easy networking, information sharing, instant communication, advanced search, blogging, videoblogs, and more. Launched in 2012, the platform has already attracted more than 115,000 users. [Note: Please see Ron Utterbeck, interview by Robert Berkman, “GE’s Colab brings good things to the company,” MIT Sloan Management Review, sloanreview.mit.edu, November 7, 2012.]

To get a sense of how executives deal with these new realities, we interviewed GE officers of various businesses and regions. These leaders and their organizations are at different mileposts along the journey to social-media literacy, just as different companies are. In aggregate, though, they described a rich range of efforts to build personal skills, experiment with technologies, invest in new tools, expand employee participation, and shape organizational structures and governance to capture emerging social opportunities. We drew on those experiences to illustrate the six-dimensional set of skills and organizational capabilities leaders must build to create an enterprise level of media literacy—capabilities that will soon be a critical source of competitive advantage.

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To read the complete article, please click here.

Roland Deiser is a senior fellow at the Peter F. Drucker and Masatoshi Ito Graduate School of Management at Claremont Graduate University and author of Designing the Smart Organization: How Breakthrough Corporate Learning Initiatives Drive Strategic Change and Innovation (John Wiley & Sons, October 2009). Sylvain Newton is the GE Crotonville Leadership Senior Leader for Business and Regions.