The Social Software Value Matrix

Mom always told me, "It's what's inside that counts."

Companies are finally paying attention to how social media affects their business outside the company walls.  They recognize the extent to which Twitter, Facebook, Wikipedia, and other mass-collaboration forums present both opportunities and risks. There is excellent thought leadership on the topic, including Wikinomics, Groundswell, and Jeremiah Owyang's blog, just to name a few.

Less well understood is the value of launching social software inside companies. Tapscott and Li/Bernoff each devote one chapter, late in their respective books, to "internal wikis" and the "internal groundswell". External collaboration seems to be the main course for them, while internal is only dessert.

There are good reasons why super-smart people like Tapscott, Li, Bernoff, and Owyang focus disproportionately on external collaboration. First, external is sexier. External collaboration has far-reaching consequences for a company's strategy, and even its business model. That's heady stuff. Internal collaboration, by contrast, is all about working across silos and accelerating decision-making. Only org geeks like me get excited about that. Second, external collaboration has an obvious business owner--the Marketing Department--and therefore an easily identifiable market for books, speeches, and consulting services. The market for internal collaboration is more diverse. It can be IT, the CEO, the COO, HR, Corporate Communications, or no one at all.

But let's think about that. If your Marketing department is driving collaboration and the rest of the company isn't participating, then all you're getting out of social media is marketing. Marketing is a nice thing, but companies social media generates much more value when companies engage on a deeper level. You want your Product people to have conversations directly with the people who use their products. You want your Support people to talk directly to the people they're supporting. You want your Salespeople talking directly to their prospects. It's not just about marketing, it's about mobilizing your company to interact continuously with the individuals who drive your company's performance.

As the CEO of a marketing agency put it to me, "How can we collaborate with our customers when we can't collaborate with each other?"

Collaboration requires a huge cultural and operational change for most companies, and a steep learning curve for most employees. They have to overcome their fear of transparency, learn new tools, master new lingo and communications conventions, internalize new ways of working, and change their daily routines.

It ain't gonna happen by following Ashton Kutcher on Twitter. If you want your employees to embrace social media, you need them to learn how to use social media for real work. Professional and personal interactions follow completely different norms and patterns.

The best place for your employees to learn professional social media is inside the company. Thomas Vanderwal was right when he told me that social media adoption is all about comfort. Most employees are intimidated by the openness and transparency of social media. By launching these tools internally--within teams, departments, divisions, business units, etc.--you acculturate your employees in controlled, comfortable environments. You can train them, educate them, watch them, and even (horrors!) let them make a few mistakes. Once your employees get used to using social software inside the company, it's easy and natural for them to expand their interactions to include customers, channel partners, and even the general public.

I think of Enterprise 2.0 adoption as a journey through a succession of benefits. I've illustrated them in what I call the "Social Software Value Matrix." The first step in the journey is pure operational improvement. You're not really changing the way you do business, just enhancing existing interactions within existing silos. Over time, the tools lead employees to interact in new ways, across silos. This creates cultural change as the company reinvents the way the different pieces of the business interact to create value. Finally, and most dramatically, companies can create new interactions with customers and channel partners. That's business model transformation, and it only happens when your business is ready for it.

The good news is that there are benefits to your company all along the journey. By collaborating more effectively internally, your company will achieve better operations, faster decision-making, enhanced innovation, and accelerated cycle-times. Getting there is indeed half the fun.

And once again, Mom was right.

Comments

[Alexander Crépin]

Dear Michael,

very interesting post. Looking to social media from an HR point of view, I am very much fascinated by the changes that will occur when introduction of social media in corporate environments.

I beleive that the employees will be the drivers behind this proces. Unlike previous technological innovations, social media are rapidly entering our homes and people are getting familiair with the opportunities that social media offer. So I think that employees are experiencing privately what a 2.0 culture implies.
The challenge for organisations is to enable employees to show this 2.0 attitude in their professional lives as well.
I believe that by inviting employees who are privately active with social media to start using 2.0 media in their work, organisations could make an interesting move towards a collaborative effectively interacting culture.

Alexander Crépin

[social software]

“Social media marketing is the best online promotional strategy available today.

[Eugene Eric Kim]

I agree with Thomas's general premise of social comfort. I also agree that starting internally is critical, but not necessarily for the purpose of developing social comfort, at least not at an individual level.

The reason Internet tools have been so transformative is that they've catalyzed change in organizations from the outside-in. Marcia Conner (whom you know) has pointed out that, today, individuals can experience enterprise tools before they are adopted by the enterprise. That wasn't the case 10 years ago, and it was barely the case five years ago. The list of examples is long: IM (one of the oldest and best case studies for enterprise social media), blogs, wikis. It even includes tools that have more traditional enterprise roots such as Internet file sharing and conference calls / desktop sharing.

Internal deployments potentially offer a space for developing social comfort, but it's more important for developing organizational norms. While social comfort at an individual level may grease the wheels for the norming process, it can't replace it. Companies who try to deploy these tools for external communication without developing internal organizationals norms are likely to flounder or fail.

I like your value matrix overall, as it emphasizes the evolution of cultural shift within an enterprise.

[shared office space]

I also agree on Thomas's general premise of social comfort. Social comfort is something that we must develop.

-Sam

[Pankaj]

What is most difficult is to measure the benefits of social software.