Famed social ecologist and the “father of modern management,” Peter Drucker once advised that the only purpose of a business is to create customers. That type of thinking lead companies to conduct marketing research, determine who their customers are and what their customer want to hear. They created positioning platforms, messaging, advertising— the whole nine yards— in an effort to create customers. For the second half of the 20th century, that model kicked ass. At least for the advertising and marketing firms who did it well. Or could convince their clients they did it well.

Today’s world is different. Duh. Customers are in control. They don’t believe authoritative voices. They don’t trust their messages. They no longer trust the media such companies employ. They don’t have to; they now connect to more authentic voices that they trust via the internet and other social media. It’s second nature.

The broad and rapidly growing consumer preference for networked media means that traditional advertising is now suspect.  The media of advertising comes with an underlying meaning— an agreed upon contract that the advertiser may bullshit you if that helps them make a sale.  That’s the meaning. We all know it. The medium is the message.

So what’s a company to do? Branding is about building credibility. About establishing and scaling your reputation. So, why use social or networked media— such trendy media— to build brand?

Networked media isn’t important because it’s trendy. It’s important because it creates customer-driven innovation. It creates brand evangelists. It can help build a collaborative internal culture and engaged work force. It demands authenticity— especially in the form of customer experience.

So can Twitter really save brands that don’t provide good experiences? That’s the question asked by Fast Company blogger Rupa Chaturvedi, who cautions companies against relying on social media to influence customer behavior when the brand doesn’t live up to the hype they’re trying to create.

These networks can be a highly effective way to build your brand externally. But there’s a catch. It only works when the messages are true. You know they’re true when they’re open. And transparent. And valuable. You know they’re successful when the network grows organically.

But Twitter, Facebook, etc. are the media. They are not the strategy. The strategy is community building. Community building is the ‘new’ marketing.

Some historians don’t like using the term ‘revolution’ when discussing the Industrial Age. Their point is that the transitions between Ages was more evolutionary. Chronologically speaking, I agree with this point of view. But I still prefer the term revolution as it refers to the social effects humans experienced.

With change came an unwritten contract. As people accepted the idea of spending their lives doing machine-like work, their expectations for security grew. Increased power of the worker manifested itself in the form of unions. And over a few hundred years of ardent and often violent interaction, advances on the behalf of the Industrial Age’s laborers continued to improve the workers’ standard of living. Businesses did pretty well too, history shows.

It became easier for individuals to accept the sacrifices of personal freedom. Over time, workers began to feel loyalty to many of the companies who employed them. Thirty and forty year careers with one company became common. Good paying jobs and benefits created safe families and opportunities to better the lives of future generations. Children and grandchildren often looked to follow their parents into the same companies, trusting in the status quo.

But a funny thing happened on the road to efficiency and productivity. Labor unions drove great improvements. But power corrupts. Labor unions were no exception. Soon, one ‘top-down’ boss was replaced by another. The influence of labor unions quickly began to wither.

In 1981, when newly inaugurated president Ronald Reagan fired every striking air traffic controller across the nation, the death knell rang. Corporations began in earnest to redraw the lines. They increased pressure on unions by moving jobs off shore.  As mothers entered the work force in far greater numbers they added substantially to their families’ fortune thereby postponing the real experience such consequences bring. But the writing was on the wall.

Today, the consequences are plain and painful. Mathematics proves that changing one side of an equation necessitates an equal change on the other side. Working conditions— where work still exists— have declined. Yet, over the past 28 years, executive compensation increased from 40 times the pay of the average worker to more than 360 times the pay of average workers by 2007. No one should be surprised that employees are less loyal than they were a generation ago.

While the power of well-organized unions has greatly diminished, workers are now discovering the power of networked associations. Bottoms up. Transparent. Authentic. Power is spread between groups and individuals alike. Nimble. Immediate. Scalable. Regardless of how you label it, we live in a new and equally revolutionary Age. Loyalty to any big power is dead.

‘Engagement’ is the new word. If you believe in meaningful data, take a look at the work Gallup has done in this area. Gallup presents a new kind thinking aimed at the most relevant business management practices for today’s work forces. It is non-intuitive to most current corporate leaders and managers. One key survey question they ask of workers is “do you have a best friend at work?’ The answer is a key indicator of corporate success.

They’ve titled their thinking Human Sigma. Here are the five basic principles:

* Employee and customer experiences must be managed together — not as separate entities.
* Emotions drive and shape the employee-customer encounter.
* The employee-customer encounter must be measured and managed at the local level.
* Employee and customer engagement interact to drive enhanced financial performance. This interaction can be quantified and summarized with a single performance metric.
* Sustainable improvement in the employee-customer encounter requires disciplined local action coupled with a company-wide commitment to changing how employees are recruited, positioned in roles, rewarded and recognized, and importantly, how they are managed.

When the media is the message and your company must be innovative to compete, any leadership discussion of loyalty will be viewed as propoganda. That includes ‘accountability’ and ‘responsibility’ and ‘commitment.’ If it is not transparent that these conversations are two-way processes, then leaders and managers who try to force these messages will lose credibility and relevance.

Loyalty is dead. Love live engagement. Thanks Gallup.