Evolution Of The Social Business

Social Business

Over the past ten years, social networking has revolutionized the way that people communicate and stay in touch with each other. Easy to use online tools such as Facebook have opened up a myriad of possibilities for heightened interaction between friends, families and communities, from the simple sharing of photographs to the rapid organization and mobilization of special interest groups.

At its heart, social networking has been a change agent, empowering people and transforming their attitudes towards how to get things done.

As such, it should come as no surprise that these attitudes are starting to permeate the workplace, particularly as the next generation of social networking ‘natives’ enter employment. Having used technology to communicate and collaborate with diverse and widespread networks of people, it only seems logical to employees that this type of technology should also be available to them where they work.

Similarly, consumers’ expectations of how they interact with the companies they buy products from have altered radically, with open dialogue via online channels replacing passive acceptance of marketing messages.

What we are seeing is the dawn of the Social Business, where traditional ways of working are being challenged and in many cases superseded by a new model based on collaboration, empowerment and openness.

For some companies, this change from within is coming as a shock, with users of social tools actively sidestepping established hierarchies and IT processes to work in new ways. While the desire to discourage and restrict social networking in the enterprise is understandable, it is ultimately a regressive step, because this is the direction in which the future points.

Instead, companies need to adapt their working practices to embrace and assimilate social collaboration to improve their business processes. Otherwise, they risk being left behind by more forward-looking and agile competitors.

What does it mean to be a Social Business? It is a company that embraces and empowers networks of people to create business value, providing them with exceptional work experiences. It has three underlying tenants:

1. Engagement

A Social Business connects people to expertise. It enable individuals – whether customers, partners or employees – to form networks of relationships that generate new sources of innovation, foster creativity, and establish greater reach and exposure to new business opportunities. It establishes a foundational level of trust across these business networks and, thus, a willingness to openly share information. It empowers these networks with the collaborative tools needed for members to engage with each other and creatively solve business challenges.

2. Transparency

A Social Business strives to remove unnecessary barriers between experts inside the company and expertise in the marketplace. It embraces the tools and leadership models that support capturing knowledge and insight from many sources, enabling it to quickly sense changes in customer mood, employee sentiment or process inefficiencies. It utilizes analytics and social connections inside and outside the company to solve business problems and uncover new business opportunities.

3. Nimbleness

A Social Business leverages its social networks to speed up business, gaining real time insight to make quicker and better decisions. It gets information to and from customers and partners in new ways, and faster. Supported by ubiquitous access on mobile devices and working together on open platforms, a Social Business turns time and location from constraints into advantages. Business is free to occur when and where it delivers the greatest value, allowing the organization to adapt quickly to the changing marketplace.

Ultimately, by creating networks of expertise and making them easy to access, a Social Business enables its employees – and customers – to more easily find the information they seek. It helps groups of people bind together into communities of shared interest and coordinate their efforts to deliver better business results faster. It encourages, supports and takes advantage of innovation and idea creation and builds on the wisdom of the crowd.

Already, those companies embracing the Social Business model are seeing real value and quantifiable improvements in the way they work. The McKinsey Global Survey of companies in 2009 found that 69% of respondents reported measurable business benefits from using social networking tools, including better access to knowledge, lower costs of doing business, and higher revenues.

A study from 2010 reflects these findings, with 44% of outperforming companies (based on their EBITDA rating over five years) using social collaboration to enable teams to work more effectively – 57% more than underperforming companies.

How is this value actually manifested within the Social Business? Take, for example, marketing. In a traditional enterprise, marketing is engaged with pushing content to its audiences, and is focused on controlling the brand rather than reacting to the needs of its customers.

By deepening customer relationships through interactive online channels, the Social Business can both drive advocacy amongst its customers and increase sales by engaging directly with the people who buy its products. Another example is product development.

Whereas R&D has often been conducted by specialist teams in isolated knowledge silos, with ideas only market-tested months into development, the Social Business uses its networks of expertise and closer relationships with its customers to generate ideas and create market-ready products faster and more efficiently.

So what are the underlying disruptive trends that are driving the emergence of the Social Business, and what are the issues for a traditional enterprise looking to embrace this model of working? Broadly speaking, there are four main trends:

1. Social Collaboration

As we have already noted, peoples’ experience of social networking technologies outside of work is often completely at odds with their company’s old world IT environment. For example, when working with a team whose members are spread across numerous sites, they might decide that the traditional email chain or series of conference calls isn’t a good way to collaborate – rather, it might make more sense to use Twitter, LinkedIn or Facebook to discuss product development or a customer issue.

They might even ‘brand’ this forum with the company’s name. The problem is that this is out on the public web and entirely insecure. In the new world of the Social Business, it’s very difficult to control this type of activity because it’s so easy to do – the only solution is to provide employees with equivalent social tools inside the corporate firewall to dissuade them from straying.

In a Social Business, the line of business is king in terms of adopting new collaborative technologies – the IT organization has to recognize this and provide comparable solutions of its own or risk being sidelined by the users it is meant to be serving.

2. Mobile Devices

In tandem with the impact of online social networking tools, the rise of the smartphone has had a profound effect on the way people interact and communicate. In the same way that we are now used to talking, messaging and surfing the web wherever and whenever we like, so users increasingly expect to be able to work and collaborate with their colleagues on the go.

Devices such as the iPhone have put the internet in the palm of our hands, with content and social networks being always available. This sense of real time immediacy is changing the traditional work/life balance, with the delineation between business and private time blurring.

Just as users expect to respond to personal messages in work time, so they are requesting the ability to access more and more of the corporate back office whenever they need to work. As such, when implementing social platforms in the enterprise, it is vital that they can also be securely accessed via mobile devices, 24/7. This will become even more important as we move into a future where non-PC devices will increasingly be the primary interface for collaboration.

3. The Cloud

Another trend that is particularly pertinent to the enterprise is the growth in Cloud-based applications – ready to use, out of the box services available all over the internet. Capable of being accessed by any device with a web browser, the Cloud offers a simple and cost-effective way for the Social Business to provide collaborative tools for its employees. Cloud-based deployments are gathering momentum, quickly moving from the left-field into the mainstream.

A survey in 2010 from the London School of Economics found that 65% of business executives believe that the Cloud will drive down the cost of running applications, while 55% believe that the Cloud enables them to better transform their business and make processes leaner, faster and more agile.

The most important consideration for IT is making sure that applications are being made accessible over Cloud infrastructure with the requisite levels of security – while the Social Business might use certain collaborative tools in a public Cloud, financial data and customer-sensitive information is better discussed within a private Cloud with strict access controls.

4. Customer Engagement

Any large scale re-engineering of a company’s IT infrastructure, particularly in the service of creating a Social Business, should be customer-focused and designed to get the most out of the closer relationships it engenders by delivering an exceptional web experience to its customers.

To become truly customer-centric, an organization needs to listen to them when they proactively volunteer information – because customer feedback obtained via social media is often very different from information gained through surveys and other, more traditional, market intelligence tools.

Instead of simply pushing messages and offers out to the market, the Social Business engages customers through open dialogue integrated with rich media capabilities that cater to customers’ preferences, buying patterns and personal networks. An effective Social Business can also implement a flexible model of customer self-service capabilities, such as forums and communities, to increase responsiveness, help with product development and decrease customer service costs.

These disruptive trends are not only occurring at the same time, but build on each other. For example, mobile devices provide an access point that significantly enriches social collaboration. Cloud services are an essential pre-requisite to making mobile devices really useful in the enterprise, as well as simplifying application access. Customer engagement often happens over social networking solutions deployed in the Cloud. This perfect storm of complementary developments is going to dramatically change the structure of IT in the future.

A challenge faced by virtually all enterprises today is how to build organizations that are more adaptive and agile, more creative and innovative, and more efficient and resilient. It is becoming clear that the traditional hierarchical enterprise, built on a structure of departments and a culture of compartmentalization, will give way to a socially synergistic enterprise built on continually evolving communities and a culture of collaboration, sharing and innovation.

Because of this, the evolutionary path to becoming a Social Business is one that enterprises will inevitably follow. The differentiating factors – those which will separate the leaders from the masses – will stem from how effectively an organization embraces both a Social Business culture as well as the technology to deepen customer relationships, drive operational efficiencies and optimize the workforce.

Stuart McRae is an executive collaboration and social business evangelist for IBM Collaboration Solutions, responsible for articulating IBM's vision for social business and delivering exceptional Web and work experiences. He is particularly focused on the business impact of emerging technologies: cloud computing, mobile devices and social collaboration. In his role, he supports key customers, partners, marketing events and analyst briefings with a blend of business, market and technical knowledge. Prior to his current role, McRae has worked in technical sales, business transformation, product management, IT architecture and development teams in IBM and Lotus. He has been with the company for 15 years and previously worked with email specialist Soft-Switch and computer fax and telex start-up Systems & Telecoms. McRae has been involved in many industry bodies, including Guide Share Europe, EEMA and the IETF. He is currently on the board of EEMA and is an EEMA Fellow.