While most social business efforts generally focus from the outset on gaining adoption — the initial strategies for which are now increasingly well-understood — many organizations greatly under-leverage one of the very best and most accessible resources for achieving high levels of traction in their efforts. Although it’s now largely appreciated that community managers form the operational and strategic backbone of social media-powered business environments and processes, they are just one set of a company’s stakeholders which must be well-connected in an integral fashion in the social business.
We now fully realize that one of the most vital group of actors in a social business are the workers of the organization itself.
In our research on social business success stories — many of which are included as case studies in our just-published strategy book, Social Business By Design — and our work with clients, we see time and again how the most intrinsically valuable social business projects carefully cultivated their employees and turned them into effective and empowered participants in scale. (See the SAP case study for a particularly high impact example.)
The benefits of employee advocacy cannot be underestimated: Ramping community management up to the levels required to effectively engage millions of customers who are trying to interact with a company socially just can’t work. Using automated engagement tools instead actually kills the point (and much of the benefit) of being socially connected with the marketplace. And, as invaluable as community managers are, they have their own point of view that can’t possibly represent the entirety of the company. No, to accomplish this, employees themselves must be externally engaged in a proactive and strategic manner that maximizes the benefits of becoming a social business. Employees know the company the best, they have vested interest in good outcomes for the organization, and they’re the most scalable resource the company has directly in hand.
The simple fact is, trust is one of the hardest attributes to come by in today’s business world. There’s been a profound loss of trust in central institutions in recent years. Traditional pre-packaged push marketing and communication, while still useful, is becoming less and less effective. In fact, countless studies — such as the famous Nielsen study that showed that 90% of people trust recommendations from other people they actually know, well-ahead of any other source — have shown that building strong relationships has become more important than transactional communication. That includes advertising or any other form of one-way publicity in terms of actually creating useful outcomes. This is underscored in hard data as well, showing that social advocacy has a dramatic effect in increasing sales for instance.
Thus, if trust is the currency of the social media age, where then will the wellsprings of trust come from for organizations, when people primarily trust only who they actually know? The answer should be readily apparent what the answer is for organizations: Only by building healthy and strong relationships between employees and the marketplace at large can the trust be regained. This can’t be scaled with a small, dedicated staff nor can it be simulated with software. Scaled engagement with the world has to be real and it has to be significant. The aforementioned rewards are demonstrably there for those that understand this and are ready to activate upon it. This has been confirmed with other recent data. And specifically, to enlist advocacy successfully requires more than an off-handed or half-hearted approach.
We now understand that an structured and properly resourced employee advocacy program is required to ensure the best and most useful outcomes for social business initiatives. Employees can be enlisted, trained, and guided to participate in ways that are eminently useful and accelerate goals for the community, for the business, and otherwise.
I should be careful to state that employee advocacy definitely does not mean putting all of the organization’s employees to work all of the time in external communities. That’s certainly not required, not possible, and counterproductive. Instead, employees should be involved based on their responsibilities, capabilities, and local business objectives. Employee advocacy is generally not a randomized crowdsourcing of interaction with the external world, but instead aligned with specific work purposes such as marketing, sales, customer care, product development, crisis management, and more. A smart employee advocacy program sets clear boundaries and provides easy to follow guidelines and then sets employees loose. Some organizations, Dell in particular stands out here for example, provide sophisticated social media training and certification, and the company has minted thousands of advocates to help them engage more successfully with the world, build trust, and achieve results.
For now, we recommend that organizations engaging in social business get more serious about employee advocacy and make it a properly prioritized component of their social business strategy, with appropriate resources, planning, and activation.
The responsibilities for those realizing employee advocacy are the following:
This is the step where community managers are indeed a vital component, to ensure the right people in the company are connecting with the right customers and other constituents as conversations unfold in social environments.
Using social business intelligence tools, social business solution owners and community managers can identify and support employee advocates, while capturing best practices and lessons learned to be shared across the company.
This completes the required feedback loop so that employee advocacy can be guided in the large to achieve desired outcomes. An excellent example of this is sentiment analysis. By spotting a brewing problem in the company’s social ecosystem and mobilizing enough company stakeholders to address it, highly undesirable situations can be averted. Doing this well requires an operational measurement and management process however. In the end, good measurement just means good management, and the measurement information must be used to optimize and improve the process on a regular basis.
Employee advocacy is still a relatively under appreciated component of social business strategy and we’re hoping that this will change as the successes it leads to are identified and recognized more broadly. Please consult our case studies in Social Business By Design as well. Finally, if you’re interested in supporting capabilities for making employee advocacy possible at scale, I urge you to look at our new Employee Insight offering.
By this time next week, Facebook should have had its successful debut as a public company. With this highly anticipated event concluded, we’ll get a sense of the market’s true estimate of what the company is worth in terms of its long term prospects to create genuine value for investors. By all accounts, the IPO of the world’s largest social network will match its equally impressive usage stats, making it the largest stock market debut of an Internet company in history.
Earlier this week I explored the social business ramifications of Facebook’s IPO in detail and noted the significant opportunities and challenges both. Near-term challenges clearly abound: Successfully shifting the full power of Facebook’s social networking platform to next-generation mobile devices in ways likely to preserve the unique value of the service will be one of two signature challenges of their early public days. So much so that it will likely define their continued growth and success in the next couple of years.
At the same time as the transition to smart mobile, is the second major challenge: Facebook must significantly beef up its business model. Even though the company’s revenue stream was $3.7 billion last year, with an additionally impressively double-digit jump in net profit, it’s clear that much of the value of the social network is being delivered to businesses for free and in a way that can’t easily be charged for. This is a conclusion that GM came to recently and announced this week to considerable coverage and debate: Specifically, it pulled its ads from Facebook’s advertising network. What was notable about this decision was that GM’s formal ad spend only represented about a quarter of what the auto giant actually invests in Facebook, the rest is in staffing, content development, and agency work in order to engage where its customers are today. The lesson: Businesses feel they must significantly engage in social and in Facebook in particular, but the best way to do it probably isn’t the captive push advertising schemes that have been devised so far.
Therein lies the strategic challenge for Facebook: It’s currently sitting on the most significant mountain of personal user behavior and insight in industry history. It’s a dataset that’s much deeper and more relevant even than Google’s, which is still probably larger but not nearly as insightful. If Facebook can help businesses tap into this data ways that also truly protects its users, then there is a real long-term path for them towards a bright future of essentially untold value creation. As I’ve suggested before, there are other, less fraught paths to value for Facebook as well. While successfully leveraging user data in the form of increasingly refined consumer analytics and engagement services is probably the single largest and most valuable way forward for the company, there’s plenty of value in just being a highly effective conduit to that same vast sea of largely captive participants. Plugging into the reinvention of CRM that’s currently taking place in the industry is a great start, and enterprises would pay a lot for better tools to enable improved self-service, customer support, marketing, sales, and advocacy in social channels.
Why would Facebook choose merely to be a conduit to its users and not their data? Because there’s an extraordinarily fine line between trust and any strategy that taps into their users’ data for business purposes. In practice, it’s perhaps too tempting, and frankly, all too easy a line to cross unintentionally, to use their truly invaluable social datasets to fuel products and services to businesses that — in the final analysis — unfairly take advantage of Facebook’s users. Clearly and unequivocally putting users first and unquestionably beyond the realm of exploitation would go a long way towards keeping their network effect alive and healthy long term. But it would also fundamentally blunt the full potential of their business. And so I think we’ll see the company continue to, and certainly investors call for them to, walk that extremely fine line, as difficult as that may eventually become.
So what does all of this mean to businesses currently employing Facebook in all its many forms, from simple Facebook pages to full-blown apps? There are a number of things that I believe will fundamentally change the way most companies engage with the world through the service. These will also ultimately decide how Facebook itself will fare:
For now, the book is far from written on how social networks will be turned into highly successful global businesses. While LinkedIn, for its part, has been particularly successful in developing business models around its services, it also has an advantage: It was all about the business world from the outset. It’s simply less clear that there is a safe way to fully take advantage of Facebook’s uniquely compelling industry leading position in consumer social networking. That there is a way forward for them I have little doubt however, but what that path remains somewhat unclear for now.
For more analysis, please read With Facebook IPO, Social Business Becomes Key, which my co-author Peter Kim and I just published on CNBC. For further insight, please see Social Business By Design, our new best selling strategy guide to enterprise social media.
Let’s face it. Social media is something that most of us now use extensively in our personal lives but that most of us still use significantly less at work. A wide variety of data clearly shows that companies are bringing up the rear. Those currently engaged in social business initiatives today are well aware that it’s taking real time and effort for their organizations to make the transition to new way of engaging our customers, workers, and business partners. Certainly it’s not that it isn’t happening widely or that there isn’t sustained, real value in doing so. This debate — a typical example — has been taking place so long and so thoroughly that the conclusion is largely foregone in my opinion: The world, including some of the business world, has widely become much more open, connected, and participative.
Thus, as we laid out in considerable detail recently in Social Business By Design, the business case for the strategic application of social media to the enterprise is now quite strong across virtually all departments and functions. Organizations are reporting they feel increasingly surrounded by social, just as they also realize they must learn to function effectively in a social world. However, they also face significant and inherent obstacles to adoption. These can make it genuinely challenging to truly adapt social in a manner that will successfully tap into what makes it so powerful and effective at creating value.
One of these obstacles is getting social technology to the right place in the business. We’ve learned that it’s actually fairly easy to drop a social network into an enterprise alongside other systems or add a bit of social engagement to a marketing campaign. But it’s quite another to meaningfully integrate them. The former has some value, but it’s not game-changing. The latter is where the rubber meets the road.
In reality, the technology of social business isn’t much of an obstacle, at least once you get beyond the internecine platform battles that are common in many large organizations. No, the problem is a human one, which is ironic because social is all about people. Yet businesses are also a kind of organism in their own way. And like a living organism, they have a defense mechanism in place that acts like an immune system to anything that would disrupt the status quo.
This corporate immune system, as you might have guessed, is known as company culture. It’s a shared set of norms, practices, customs, expectations, and habits that have formed around and perpetuate how a company works and operates. While company culture is great at making the business function as expected and helps foster continuity and order, it’s also astonishingly good at killing off attempted changes to the system; undesirable and desirable both. It’s one reason why the entire industry of change management has emerged, so that companies can keep up with the our era’s ever increasing rate of change, of which technology itself is the most disruptive and high-velocity example.
My colleague Dave Gray notes that we are now aware of much better ways of structuring and managing our businesses in a post-industrial era. We can move from hierarchical to networked models (what he calls podular) that are far more dynamic, efficient, and productive ways of working. Another of my industry colleagues, the always insightful Rawn Shah, has been suggesting that for companies to modernize, they will have to reinvent the company model, throw away the current (and broken) advertising model, and move away from the outdated industrial company model.
All of these are just ways of saying that the company cultures we’ve built up in the 20th century often don’t serve us very well today. Not in the era of social media, pervasive connectedness, and virtually free access to high-scale, world-changing networked tools. And change we must. Our company cultures must adapt and evolve to their times. Beyond the simple need to survive, failure to adapt means we can’t access the benefits of next generation business models, the most important of which are now creating new companies worth hundreds of billions today in historically very short periods of time.
In short, digital and social natives are dethroning the old guard. Dave Gray also likes to point out that the lifespan of an S&P 500 companies has plummeted dramatically in the last couple of decades. The upshot: The conditions under which our companies were created, thrived, and led their industries have changed. The good news is that our organizations certainly can change how they work. The bad news: If we don’t change ourselves as workers, managers, and executives, there’s little point in structural and process changes we can’t possibly enable, lead, or make successful.
So how do we get there? How do we make social business transformation effective? We can change our business processes, switch out our IT solutions, update our intranets, overhaul our marketing, sales, and customer care. But if we resist it, if we can’t think about it in its own terms, if we cannot act in a way that enables it, then we lose access to the promise. The promise itself is clear as I’ve covered many times in the past: More productivity, efficiency, innovation, customer satisfaction, and more. Superficial tacking on of social media to what we already do today isn’t the answer. As Brian Solis pointed out this week, building a social business must be treated as an investment, and one that will pay off handsomely.
In our work with clients, we’ve learned many hard lessons about how to situate social business. Even the need for culture change unfortunately is still not widely understood. The issue is, social business is a different way of working than we did in the industrial age or the post-industrial interlude. If it wasn’t different, we wouldn’t need to work hard at learning the methods and adapting our organizations. No, the networked age is now upon us and it means that the very notion of where value comes from, who creates it, and how it’s achieved at all is up for grabs. This perspective can be somewhat disturbing even while it also unleashes all new possibilities. Just understanding the concept of emergence alone, successfully grappling with the concepts, and then aiming at business problems is a long journey for some. Fortunately, the process of culture change, what the steps are and what the process looks like in general for the typical company is increasingly well documented. As are the issues around social business ROI and maturity.
In the first visualization above, I’ve depict the general stages of culture change across the major areas of an organization: supply chain, customer experience, and workforce experience.
The last is one that only a few companies have reached and is possibly controversial, but in my research it’s the inevitable destination of social business. I’ll explore each of these stages in more detail in future posts as I can. For those who currently have a hard time visualizing these changes, sometimes it’s good to look at a more holistic view of digital strategy as a cross-check.
The stages of social business culture change describe the changes in the business in key operating areas, but it doesn’t describe how to get there. That’s in the second diagram on the left. This shows the key activities that drive culture change including executive and community leadership, strategic goals, business process redesign, education and training, risk management, and governance. Note that there is a shift from centralized culture change activities to community-based ones over time. This is an essential part of the process that can only start once vibrant communities and social constituencies have been created. Obviously there is more to each of these and I’ll cover those as soon as I’m able as well.
I’m hoping this provides a broad and high-level picture of many of the moving parts of the real changes that organizations must make to quickly adapt to a business environment that is very, very different than it was even five years ago. Can most organizations change their DNA quickly enough to survive intact? That’s an open question that more and more business leaders are asking. But at least we have a clear sense of what we have to do. Now we’ll find out if most of us can indeed make the journey.
Our new business strategy book has just been published by Jossey-Bass this week and is now available in print and e-book online. It will also be in bookstores near you — depending on your specific locale — within the coming weeks. Co-authored by myself and Dachis Group Chief Strategy Officer Peter Kim, we have carefully designed the book to be highly accessible to executive audiences who have some familiarity with the topic, but who aren’t themselves experts. We find that business leaders crave a way to quickly get up to speed on the issues involved in transforming how they operate using social media in order to drive what are increasingly extraordinary outcomes. While perhaps somewhat self-serving, we hope that those leading social business efforts will make sure their executive teams and staff have copies of Social Business By Design as the definitive guide to explain, educate, and accelerate their efforts.
Let’s get right to the question of why social business at all. Is it bold to say that applying social media strategically can truly enable extraordinary business outcomes? Probably. Yet, in our years of research and practice, that’s exactly what we found in leading companies as they employed the truly profound and powerful forces of human peer production and collective intelligence deeply to the way they work.
To be sure, some organizations have occasionally seen results that are less impressive. Just as not every marketing campaign, IT project, or business initiative is a runaway success, sometimes the application of a powerful tool doesn’t squarely connect with the problem. In fact, achieving success requires experience and knowledge of what works and what doesn’t in a particular situation. And that is exactly what this book intends to provide: A distillation of experience to create a mature, working foundation for business and technical leaders such that they can effectively apply social business concepts enterprise-wide to drive practical results for their organization.
Peter Kim and I, and those in the Dachis Group team whose ideas are frequently represented here, have spent years in the trenches working on social media within organizations at all levels, in a wide variety of industries, in countries around the world, and in various business functions ranging from marketing, sales, customer care, operations, product development, and support functions like HR, compliance, and legal. We believe this has given us a front row seat that we can share with you about how to think about, design, and successfully situate social media-based solutions in a wide variety of internal and externally facing business functions. Our experience, and the combined knowledge of Dachis Group and our clients as a whole in this space, is instilled in this book. While many companies back into social media unexpectedly or with little upfront plan, we have found that the very best results come from strategic application, intentionally, by design.
The truth is that nobody wakes up in the morning and randomly decides they need to bet their career on a trendy novelty that strikes right at the heart of how they run their business. Yet it’s also true that most executives and managers with decision making authority hunger for better ways to work, to drive returns, to beat the competition, to create a survivable future, and to create a better world. But they need to have the confidence that these new innovations are readily within reach and are highly likely to provide significant returns. We believe social media has become such an innovation and we present the evidence throughout the book in statistics, compelling case studies, and deconstructions of the fundamental power laws that make social media a much more effective way of operating most aspects of a business.
But having strong motivation to move towards more social, connected, and participatory business processes isn’t nearly enough by itself. Organizations need extremely clear comprehension of the objectives in order to reach them and create sustainable value as quickly and directly as possible. To this end, we’ve painstakingly recast the concepts of social business into the clearest and most accessible articulation possible. In the book we lay out the underlying tenets of social business in a way that we believe greatly improves the ability of organization to focus on what is most unique and potent about social media from a business perspective.
In fact, we think that the book in general is one of the most succinct, focused, and cohesive approaches to how to enable social business for the large to medium-sized enterprise. A breakdown of its salient features makes the case for how this book can quickly aid organizations in their planning, strategy, architecture, design, implementation, management, and governance of social business at a program and project level.
So far, initial reviews of this approach are promising, such as what Brian Sommer on ZDnet wrote this week, but as more critiques continue to be published we’ll highlight them in order to get feedback for future editions, as well as potential expansion into a series. For now, we’re eager to get your feedback and hope you find the book invaluable in your journey to become a social business.
Finally, I’d like to thank Jeff Dachis for making this book possible by lending his considerable support to this project, our editor Karen Murphy for her help and guidance, as well as the great many industry and company colleagues who helped organizationally with content, ideas, and insight.
Official Book Site: http://socialbusinessbydesign.com
Related Dachis Group Social Business Resources:
It’s a pretty simple equation at the end of the day. When businesses decide to invest in technology, they are hoping to ultimately get more value back than they put in. The time windows for such investment are generally 2 years, more or less. This was recently validated for me as I helped judge the entries for the 2012 CIO 100 Awards. I was surprised that many companies expect 100% ROI in rather short periods of time, often in just sixth month for efforts that may have taken years to implement. Whether this is generally unrealistic or actually achievable is besides the point.
The fact is there’s virtually no question that technology has dramatically increased productivity in developed economies around the world over the last 10 years. I often lead my talks these days with the chart of worker productivity in the last decade, which has had a tremendous run-up. Technology is a profound force multiplier, an amplifier if you will, for human effort and that’s why it’s such an important industry. Consequently, the value that a decently organized IT effort can throw off, even today when diminishing returns should be in sight, can be very significant.
These days the talk in enterprise circles is about the next generation of IT, specifically what it is, why it’s valuable, and how to get there. This new wave of IT is generally accepted to revolve around smart mobile, cloud computing, big data, consumerization, and most germane this to discussion: social. Social media, or social business when we talk about applying it in the enterprise to get our work done, has definitively arrived on the global business stage. The latest numbers from Emarketer say that nearly 1.5 billion people will be engaged in social media this year. Other data shows that there has been a mass migration from other forms of digital communication. Thus, it’s no longer optional for enterprises to engage with their workers, customers, and partners in social media. Unfortunately, some companies still haven’t received the memo about this global change and will end up losing contact with a substantial portion of their market. Others are much more interested and willing to invest, but only in a well-organized effort that can zero in on the business value.
And this is the rub: The techniques and approaches of social business are just a few years old. They can be applied in a large number of ways, only some of which will solve major business problems or meet strategic needs. ROI is as ROI does, to paraphrase a well known saying. Often, feedback loops are all we have to see if we’re scratching the right itch. We measure what we’re doing, see if it’s moving the needle, adjust and optimize based on what we’ve learned. Rinse and repeat. This feedback loop has become central to finding our way.
Deb Lavoy perhaps set it best in a seminal piece yesterday on CMSWire:
We have a lot to learn about social business — though we in the biz are crazy saturated with it day in and day out, it’s really only 3, maybe 4 years old. We have yet to determine what it can do, what makes it work, how to be successful, and when to expect what kind of results (though we have lots of excellent theories).
The right metrics, properly applied, can help us learn. Are we progressing? Why or why not? Are we defining progress correctly? Does action A work better than action B? When properly considered, metrics help us chart and adjust course toward meaningful goals.
Metrics represent an hypothesis — one that can be right or wrong — giving us the chance to prove it one way or another. Metrics are guideposts — your weight can be an indicator of health, but it is not in and of itself health. In fact, cancer patients are known to be quite thin. Goldman Sachs, Enron or BP — all were doing well by many measures of corporate performance and each met with disaster that “no one” predicted.
By definition this process, which goes to the heart of much IT adoption and optimization, means that we only have a rough idea of what we’re really doing and we need full contact with reality — namely actual business processes — to see if we’re on the right track. Unfortunately, our internal stakeholders are usually uncomfortable being the subjects of such experimentation. They want the “correct” solutions and they want them now. In short, they want to know: Will social business help improve customer engagement? Can it increase customer satisfaction? Will it make workers more collaborative and efficient? Can it dramatically improve product development, recruiting, or sales processes? The ROI question, particularly around enterprise social media, is always asked by those unfamiliar with the solution being proposed.
While the answer is almost certainly yes, we’re still in the ungainly teen years when it comes to social business maturity. Our answers, for a particular business or even a given industry, are sometimes less than certain because of the general immaturity of the industry. These days, I’m much more confident, based on the growing body of evidence from many quarters, that social business is a real force multiplier in its own right, and it’s one that’s generally more potent than previous forms of communication, collaboration, and engagement, often by double digit margins. But we’re often only 60% of the way sure of how to apply it in a given business situation. The rest has to come from post-deployment optimization as well as emergent outcomes. These two factors alone mean that 6 month ROI windows are less likely to occur, even though the payoff will ultimately be very substantial.
In fact, as I’ve written before, social is a new type of technology, one that’s much more freeform, unstructured, and yes, unpredictable than the advances that came before it. This means much more innovation, variety, and volume will come from it. It also means it must be managed very differently. By this I mean the ROI of a social business effort regarded and managed through the traditional IT project delivery process will look very different than a deployment and management effort matched to the technology. One that is fundamentally agile, highly iterative, and actively encourages and supports emergent outcomes. These days, I’m not theorizing, we now see this as key lesson learned and explore this in some detail with case examples in our new book, Social Business By Design (see the MEC case study.)
In the meantime, to get to ROI with social business the most direct way, I recommend these steps:
That’s a good start and hopefully enough to avoid the major causes of low ROI for most efforts. But in today’s amazingly packed enterprise IT landscape, practitioners will need every edge they can get to stay ahead of the technology change curve.