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'Social enterprise' moves closer to reality

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IBM report: ROI of social business is still murky -- but organizations should still press ahead, with promising potential in analytics and employee 'alumni' networks.

Is the "social business" -- an organization well tuned in to networks at all levels -- a reality or still a dream? A new report from IBM distills the observations of proponents who see the potential, but recognize there's a lot of work remains.

Back in February, IBM hosted an online conversation (called a “Jam”) that brought together more than 2,700 participants—representing corporations, academic institutions, nonprofit organizations and government agencies—to discuss the implications of emerging social businesses. (Thanks to my colleague Bill Ives for the pointer to the report.)

IBM just issued a report that summarizes the key insights gathered from the comments of the entire community, which can help serve as a blueprint for organizations that are considering adopting a social business strategy.

Here are some key points that came out of the Jam:

ROI issues came to the fore. Adequately measuring the return on investment of social technologies on the business is a major show-stopper at this time. "Many participants believed that the usage of social media is absolutely quantifiable and measurable, but it involves tracking a new set of metrics." Metrics include monitoring of frequency of brand mentions, frequency of customer comments, number of customers exposed to messaging, and how many issues are being resolved.

However, ROI isn't so clear cut when applied to social media. As one Jam participant observes: “You can successfully measure the ROI of social media, but you must first understand your audience’s needs and motivations for engaging with social media.”

Another asked: “Did we figure out the ROI of email, instant messaging or even the telephone? No. We just focused on measuring overall performance in our business objectives.”

Business process issues were also top of mind in discussions on social businesses. As one participant put it: “We’re going to see a significant transition away from more-structured business processes to a much more socially collaborative process style. Employees will be much more aware of their processes via the communities in which they’re involved and will work in a much more dynamic and collaborative
fashion.”

Social business changes the focus of human resource departments. "HR needs to embrace the fact that employees have their own personal brands that exist both inside and outside the business and that it does not own these brands but merely 'rents' them while employees are at work."

In addition, the bonds between employees will remain in place, whether they are still there, are have moved on. "As employees transition and become alumni of an organization, it becomes even more important that HR maintains relationships with its alumni network. Social tools can help provide a strong, dynamic way to keep the alumni network active and useful, enabling the organization to keep an invaluable source of knowledge, mentoring and connections."

In social businesses, data rules. Social media results in a surge of Big Data, involving a lot of customers and individuals that are not part of the organization. Social input must be monitored, analyzed and routed to the people who need it. As one participant observes: "Social intelligence is a way for companies to get value from social business. Listen to what your customers are saying, filter out what is important for your business and quickly take action as an integral part of your business process.”

Information technology as educator and innovator: IT has a historic opportunity to lead the growth of social enterprises, but needs to transform itself. "With social tools and third-party consumer applications coming to the forefront, IT needs to be more open to innovative strategies." As one participant said: “In many organizations, IT lacks the speed to keep up with evolving social networking. Users have access to fantastic, affordable technology for personal use. IT needs to either figure out how to make those functions enterprise grade or face widespread rogue adoption of the consumer versions.”

IT can, and should, play an educational and facilitative role in supporting social businesses. As one Jam participant says: “People are in learning mode. IT can provide ‘how to’ templates, but limiting functions, restricting access or applying controls at this incubator stage could curtail people’s enthusiasm and creativity.”

IT also can lead the way with analytical tools, the report says. "Analytics can help identify influencers and leaders, create taxonomies to provide a better context for incoming information and enable users to mine data from blogs, wikis and tweets, helping determine patterns and better quantify—in real time—brand perception."

Another Jam participant says IT also is in a position to drive innovation, if it can embrace greater flexibilty: “The incredible pace of adoption of smart phones and tablets is the enabling partner for social media. But this requires a nimbleness and connection with end users that IT is not accustomed to.”

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Joe McKendrick

Contributing Editor

Joe McKendrick is an independent analyst who tracks the impact of information technology on management and markets. He is a co-author of the SOA Manifesto and has written for Forbes, ZDNet and Database Trends & Applications. He holds a degree from Temple University. He is based in Pennsylvania. Follow him on Twitter. Disclosure