posted by Joseph Do
Intel paints all its factories the same colour, to give workers a sense of togetherness. Steve Jobs designed his Cupertino headquarters with snug corners where designers and engineers could bump into each other. Outsourcing has lost its buzz; the trend today is to insource – with everyone from big banks to Big Pharma realising that the more opportunities teams have to interact, the faster innovation emerges.
So why is it that even as McKinsey talks about $1.3 trillion in business benefits to be gained through social tools, IT executives see social networking as providing the least impact to their organisations this year?
Perhaps it’s that word, “social”.
Making your business “more social” is not a business goal… because on its own, there’s no business outcome.
So while the start of every year sees bold predictions of how social solutions will transform the enterprise – and spending on social software is increasing year on year – social software still isn’t high on the list of CIO priorities. And most companies seem to be dipping their toes in internal social solutions rather than making these collaboration platforms the backbone of collaboration for business needs.
That’s why email has long been the de facto tool for collaborative decision making – it’s easy and everyone’s got it. The problems with using email – lack of priorities, one size fits all, the ease of cc and bcc – are widely documented, with the ultimate result of slowing down decisions. But are enterprise social tools – touted as the saviour to all our problems – really the answer?
Let’s look at three drivers we at FCG think are holding things back.
No clear business benefits
For any technology to be successful in business, it needs to be able to demonstrate a positive impact to the business. Furthermore, the benefits need to be easily communicated at the executive level, which means show me the money! An increase in top line revenue or a decrease in overall costs.
As Haydn Shaughnessy says, a major issue is that “in the business platform sphere vendors continue to ply social platforms with no clear vision of their application beyond the obvious requirement to collaborate. I think this will become increasingly problematic in 2013 as executives see another year of cost cutting and over-rational spending in front of them.”
So until social software can prove it has an impact on the financials, it will stay in the shadows. And CIOs will refrain from making social a top priority.
Fuzzy intangible “success” stories
We’ve all seen examples of companies implementing social networking simply to follow the trend and copy their competitors. But the majority of medium to large organisations remain cautious and risk averse. Decision makers in these companies want to see real world examples of how these tools have been implemented in other organisations and the benefits they are delivering.
Unfortunately what these leaders find are “success” stories that are built on intangible benefits.
How many case studies have you read where success is defined as 20% user activity in a week, or the number of blog posts or comments on the platform? How many times have we seen figures that state a percentage reduction in email or meetings, or speedier access to information and experts?
What business leaders want to know is how those fewer emails or meetings or that increased access are driving sales or improving operational efficiency.
Emphasis on Culture Change detracts from value creation
Finally, social business software is seen as the catalyst for a newer way of working, a different culture with the workplace, one of fewer hierarchies, greater transparency and broken down silos.
Perhaps all good things… but not, by itself, a clear pathway to greater business value.
According to Tom Petrocelli of ESG, vendors initially targeted end-users with the culture change message, hoping for viral uptake. That strategy seems to have delivered very limited results, he says, so vendors are now targeting upper management, but with the same message.
“There has been a shift in the messaging. Now, we are being told, it’s really a top down affair. Upper management must make a commitment to change the culture of their organizations in order to see value from these social tools. Within this narrative, the cultural change will drive more innovation and productivity.”
While few would argue against the positive benefits of a more open and transparent culture, cultural change doesn’t happen overnight. It takes years and is driven primarily by leadership seeing the need for culture change. Social tools can definitely help create a more collaborative culture, but driving change when the need isn’t obvious also carries risks. So focusing purely on culture misses all the other benefits “social” technologies can provide.
The business side of social: breaking the chains
Modern management revolves around performance metrics – both at executive and individual department level. Successful sales teams are constantly analysing cycle times and conversion ratios; product development teams are measuring new product launch rates; program management offices are measuring how many projects are delivered on time and on budget.
Social technologies can help in each of these scenarios and have a real, tangible effect on these measurable performance indicators.
Could this be the year that the vendor and analyst community start talking about true business metrics instead of social benefits? As one CEO told us “’social’ is what you do after work!”
At FCG, we believe it’s time for the social space to grow up and blaze a new trail that transforms business results. A space where informal collaboration becomes a true driver of innovation and business value… but more critically, a space where that value is measurable.
We call it Business Critical Collaboration.
A strategy that doesn’t stop with connecting people or letting ideas flow freely.. but continues into the results and outcomes of value creation. Collaboration that goes all the way to the bottom line.
And that’s something worth talking about.
Have you struggled to prove tangible benefits from social initiatives? Do you think the term “social” is self-defeating? Let us know your thoughts on how companies can move beyond the fuzzy benefits and start demonstrating real ROI from collaboration technologies.