These days a growing amount of the discussion concerning social business involves how to move beyond the “tacking on” of social media to existing digital and traditional business processes. It’s not that such incremental efforts aren’t useful and such augmentation can and usually does have value. It can also build early skills, develop organizational capabilities, help work through tooling decisions, and form the on-ramp to more substantial social business transformation. However, tactical experiments generally result in outcomes that aren’t strategic by definition, with limited outcomes and blunted impact; there are much better ways to apply social business when the underlying business processes — and even the underlying business models — are thoroughly overhauled more holistically for a pervasively connected and digital world.
To underscore this point, an important new post by Altimeter’s Jeremiah Owyang this week explores how we’re only getting started with social business, even as the whole social and 2.0 movement gets ready to reach its first full decade. In the post, Jeremiah presents some of their latest survey data showing that only a few organizations have reached an advanced stage of adoption, that there is limited integration across business units, products lines, and customer databases, and that only a leading cadre of companies are highly organized or systematic in their use of social media. In other words, a lot of useful work has been done but most of us are only getting started and we know it.
I’d also be very clear about the overall global progress towards social business so far: It’s not that companies as a whole aren’t increasing their social business maturity, in fact, they are largely well on their way. We can clearly see this in the most recent McKinsey data I presented at the Enterprise 2.0 SUMMIT in Paris last week (slide 11) and have delved into recently elsewhere. From this, we see that the number of large companies that are fully networked — meaning they are genuine social businesses inside and out — now number in the low hundreds. As for the remainder of Global 2000 firms, the data clearly shows a steady and inexorable rise in social business adoption over the last five years.
What does this all boil down to for organizations that want to reap the benefits and avoid the potential for disruption and competitive stagnation? Generally it means understanding where you are today and measuring the gap between that and the full on, high scale, high impact realization of social business. In this way, understanding your organization’s maturity level when it comes to social business is an excellent means of mapping out where the greater opportunities are. Unfortunately, I see companies all too often squandering even the the low hanging, easy-to-reach potential to re-conceive and galvanize key processes in customer care, product development, marketing, sales, and operations. Usually it’s because they look at it through the lens of what they do today, versus what the industry norm will be in five years, or even what leading companies are already doing today.
In short, this means that organizations updating their structures and processes based on what they do currently are often preventing themselves from moving into the future. This is rich and opportunity-filled future of customer, worker, and partner engagement is one that is fundamentally social (it’s also highly mobile, cloud-centric, and data-driven), and to get there organizations must strategically aim their evolution in this direction. This then is the real benefit of understanding your present state in order to calibrate from ground truth and make strategic decisions.
Baselining Your Social Business Maturity
So this begs the question, and one that Jeremiah asked as well, what then are the indicators of maturity and how should they be measured? Fortunately, we’re now a number of years into social business and have the lessons learned from many companies having gone fairly far down the path. We have a growing sense of what the maturity measures are, although they can vary greatly based on a number of factors. These include whether it’s an internal or external social business effort, what the business objectives are, what industry the organization is in, and what technology and platform choices have been made. For many, their level of maturity is also deeply impacted by governance, social media policy, and legal/regulatory constraints. Getting a handle on all of these requires work but as we’ll see, it’s getting easier.
The broad outlines are clear enough, however, and there are a number of factors that virtually all organizations should be measuring and tracking going forward in terms of the maturity of their social business efforts. For most enterprises, this will break down to the following criteria plus whatever industry/business specific elements that are important:
- Level of organization for social business. This is a measure of how systematic, strategic, and intrinsic social business has become with the people, processes, and policies currently in place within the business. The progressive scale that is most often cited, and which I largely agree is the following:
Ad hoc – No management, no budget, no real structure or resources
Engaged – Executive awareness, some management engagement, pilots and experiments, mostly volunteer and part-time resources
Structured – Dedicated budget, management responsibility, formal projects, high-level roles
Managed – Active executive sponsorship, daily management, social business program office, professional staff, well-defined roles and responsibilities, requirements driven
Optimized – Strategic executive focus, support unit-sized budget, integrated multi-channel initiatives, social business unit/center of excellence, guided by business intelligence.
- Extent of social business adoption. When it comes to organizing for social business, there are a number of phases that organizations go through. This includes tactical experiments, departmental adoption, grassroots efforts, and so on that ultimately lead to social media committees, enterprise-wide strategy efforts, business process re-engineering, governance programs, education and communication efforts, and so on. Mature organizations have a well-defined social business program (and one that actively enables emergent outcomes), with multiple loosely integrated projects that cover the spectrum of line of business functions and internal IT capabilities (intranet, collaboration, doc/content management), etc. The greater the number of areas the business touches and IT systems engaged in working in a social business manner, especially when they are cross-departmental and/or integrated into the global strategy, the more sophisticated the organization has become, though this measure is often insufficient by itself to determine overall maturity.
- Social engagement level of workers: Internally, externally, and cross-border. Are social business processes well defined? Does everyone know their role in them? More importantly, when they are drawn in, do they participate effectively? Maintaining and keeping these measures up to date, typically via social analytics, is vital to understanding social business maturity as well as to support and drive their optimization. Measuring this is also key, even to the point of tying compensation, bonuses, and employee recognition/promotion.
- Measures of effectiveness. This is where the rubber meets the road when it comes to business value and making sense of return on investment (ROI). Even today, a large percentage of social business efforts don’t measure the results other than some high-level operating KPIs (key performance indicators.) Some of the reason for this is that it was very difficult until recently to measure the results, particularly if it had to be done frequently, which is typically the case with the fast moving conversations, trends, and opportunities of social business. Fortunately, with the rise of social analytics and big data tools to aid in this, it’s easier than ever to create a continuous and scaled listening, analysis, and engagement process with real feedback loops and matching social business intelligence. Measures vary widely but increasingly we are advocating a scoring model that can be used to objectively compare points at regular intervals in time to measure the effectiveness of social engagement across relevant participant segments such as audience and industry (external) or project/team/function (internal.)
- Progress along the digital business ladder. In its more transformative and strategic form, social business alters and then recasts the very business models of an organization, including how its products and services are produced, delivered, and supported. I’ve explored the four rung social business ladder in detail before, and unlike measures of adoption or number of tools deployed, it’s a very effective cross check to understanding if the inherent shifts that social business represents are actually taking place. Most organizations will need to create a more detailed version of the ladder that’s applicable to their business in order to complete the strategic effort to understand the full range of possibilities and road ahead. It’s thus also a powerful maturity measure.
Hopefully this has explained why baselining the maturity of your social business efforts is much more than a dry, academic exercise. It helps focus an organization around objectives and possibilities, while understanding the nature and scope of what’s left to do and where investment should be made. I rarely advocate large formal efforts for this, though I’ve certainly seen some clients do this. Instead, enabling tools and methods are rapidly emerging to make this more of a diagnostic process that is easily and inexpensively repeatable. I’ll take a look at examples of how organizations are increasingly applying new analytics and business intelligence tools to build snapshots of where they are in their social business journey to direct their work.
In the meantime, I urge companies to explore the options as they organize for more ambitious and complex social business processes. One easy way is to see your company’s current measures of performance in our Social Business Index. It’s free and only takes a few minutes to see how effective the social business engagement of your company is.