Social Business All Talk No Trousers
Has the hype surrounding the social enterprise being the-next-big-thing run its course?

It is an important question to answer when analysts at Gartner say that 80% of investment in social business tools will not add value to business profitability due to "inadequate leadership and an overemphasis on technology" and others see no corresponding increase in efficiency and productivity. Yet Gartner reports elsewhere that there are the beginnings of a positive upturn in IT spending.

Are we about to witness yet more companies making the same mistake? If so, what should they do differently to ensure they get the most out of their investment?

Measuring Inputs Rather than Outputs 

If there is one thing we can be certain about, it is that many businesses appear uncertain about how to include social initiatives in their day-to-day operations. The recent NetStrategyJMC Digital Workplace Trends 2013 survey confirms this. Only one third of those surveyed have managed to align their social strategy with their business goals. Those that have successfully invested in social tools are reportedly most concerned about how many staff are collaborating and connecting with each other, instead of the more important metric, measuring the quality of what has been produced. As the survey succinctly put it: everyone is "measuring inputs rather than outputs."

Perhaps a more telling insight is that other "softer" factors are also influencing why companies invest in social technology. For all the potential of tools like Microsoft’s SharePoint, Yammer and Jive, and idea exchanges such as Spigit can bring, in reality, many companies prefer to use them to retain, nurture and give staff a voice.

As the Digital Workplace Trends 2013 report continues, very large organizations use these tools to help foster "employee engagement and belonging." Surely they could instead be spending their time reevaluating their existing suite of products and services in order to create new innovations that will help them beat the competition in this tough economic climate?

Technology no Substitute for Culture

In the same sense, companies seem to be rebranding themselves as social businesses when they have had enough of their own cumbersome and bureaucratic networks, hierarchy and departmental silos, and want simpler ways for staff to connect more easily with each another. That makes sense if a company’s structure has become a barrier to its future growth. But is the general interest in social initiatives more about hiding deeper structural problems instead of trying to solve them? If that is the case, are companies using social business strategies as a Band-Aid rather than a solution?

Take collaboration. It is never easy at the best of times. Bringing together teams that previously could not share knowledge due to for example geographic barriers will always be a good thing. However, getting teams to work together remains a complex and time consuming process. Having the technology in place is one thing. But it is no substitute for a culture that encourages staff who might be reluctant to share new ideas with each other. Putting that in place is difficult. Some companies might not be set up to make that happen.

As Brad Palmer, CEO of Jostle Corporation points out, social networks, apart from creating a lot of noise that staff to have to contend with can "confuse and challenge how decisions are made" and "inflict massive change in how and where work gets done." This is an important point. Disrupting the normal decision-making process can be liberating, but it can cause chaos unless there are ways to deal with its results. Staff can quickly lose interest if the collaboration process is too drawn out, or if staff no longer feel connected to problems they are being asked to solve. These and many more challenges need to considered before any social initiative is started.

Using Tools with a Purpose

So how should a company go about using social tools? Part of the answer lies in being specific about which business problems need solving. Staff need to know what they end up producing has a very clear sanction from senior management that will ensure the output is not wasted.

They also need to recognize that a one-size fits all approach is less likely to work. As Kieran Kielly of Dachis Group points out, "a sales team may be driven by financial incentives whereas a team of software developers may be more driven by recognition and reuse of their solutions." Different sets of employees will have varied motivations. Understanding that will help encourage better participation, and will dictate what type of tools you end up using to the best effect.

Companies need to decide on whether the nature of the business problem they are hoping to solve is worth the effort. Some have tended to use social strategies to deal with improving existing processes, products and services. Nothing wrong with that. But if the outcome is an incremental improvement, management might struggle to justify their investment.

Instead social tools can be more effective when they are used to identify new ideas, inventions and innovations that purposefully bring together internal and external research, expertise and opinion. This can be a better use of their disruptive potential.

Writing in the Sloan Management review, authors Eoin Whelan, Salvatore Parise, Jasper de Valk and Rick Aalbers argue that social networks are a great way to use what they call "idea-scouts" whose job it is to identify novel ideas (including existing knowledge that might have been previously overlooked) that exists internally or outside of the companies walls, and deliver it to the right person who can make the most use of it. Their research was based on investigating how companies like Procter & Gamble, Cisco Systems, Genzyme, General Electric and Intel have managed to innovate by internalizing the right kind of knowledge.

The key was by developing roles they call "idea-connectors" who took what the scouts found and delivered that to the most appropriate internal expert, who in turn helped the company innovate. They warn that "research shows that many [companies] are failing because they neglect to ensure that the outside ideas reach the people best equipped to exploit them." This is where the disruptive potential of social networks (that don’t unduly affect the normal, day-to-day operations of the company) can help companies develop -- through identifying and sourcing novel ideas that they might have overlooked.

Creating these kinds of ad-hoc social networks that bring together "scouts," "connectors" along with other experts (who would not normally find themselves working together) can create dynamic problem solving environments, if there is a willingness to make it happen. These kinds of fluid networks can produce far higher quality ideas at a much faster rate than those that involve everyone in the company all at once. But they are for companies who see the need to invest in developing more radical innovations than of improving what they already have. This is not a strategy suited to everyone.

Investment in social business technology will continue. But as we have seen, there will be added pressure to justify it, especially if the business value is not clear. However that is not to say that companies should not experiment with new ways to collaborate and generate ideas. But the lessons so far tell us that they must first establish clear goals, and second, be patient for results. Great ideas don’t just fall out of the sky. But with a powerful network, spotting new emerging opportunities will be a whole lot easier.

Title image courtesy of LeksusTuss (Shutterstock)

Editor's Note: Read more from our month long focus on what's next for the social enterprise here.