Organizations that became early adopters of social technologies, using them to engage with employees, clients and partners, are now moving beyond the implementation phase and enjoying the benefits of social business: improved customer service, increased efficiency and faster product innovation among them.
Social businesses are now looking to what’s next: how can organizations continue to grow in their social efforts? There are two major trends social businesses are embracing: the expansion of social into ALL aspects of an organization, including (but not limited to) marketing, finance, HR and facilities, and the increased attention on measuring the ROI of this transformation.
Expanding Social throughout the Entire Organization
Marketing and the CMO
Social is often first embraced by marketing, as chief marketing officers (CMO) quickly saw the value in being able to monitor and quickly respond to customer conversations. A recent IBM study of more than 1,700 CMOs reveals that 82 percent plan to increase their use of social media over the next three to five years. Another survey by Duke University’s Fuqua Business School revealed that social media spending as a percentage of marketing budgets will more than double in the next five years. Couple this with the fact that CMOs are slated to spend more on IT than CIOs, and it's safe to say that there’s a lot of focus on the right social tools to help and retain customers.
CMOs can gain insights on external data from sources like Facebook, Twitter, Pinterest and public forums to react more swiftly to customer trends, build their brands and create exceptional customer experiences that inspire brand loyalty. According to a 2012 Nielsen study, one in three social media users prefer contacting customer service through social media than by phone.
Finance and the CFO
CFOs can use data shared through social tools to streamline business processes and drive results, particularly as social tools transition from a new technology into an essential tool for conducting business. According to Gartner, by 2016, 50 percent of large organizations will have internal Facebook-like social networks, and that 30 percent of these will be considered as essential as email and telephones are today.
From the CFO’s perspective, social tools pay off because they can reduce customer attrition, which is critical when you take into account that just a five percent decrease in customer attrition can boost profits by up to 95 percent. On the flip side, finding new customers can cost up to seven times as much as keeping existing customers.
Organizations cannot succeed without focusing on acquiring, empowering and growing talent. Human resource executives can use social tools throughout the recruiting, hiring, onboarding and employee development process to help create a happier, more productive, global workforce.
Human resources are also receiving pressure from executive leadership; according to a 2013 Bersin by Deloitte study, over half of business leaders surveyed cite gaps in their leadership pipeline as one of their three critical obstacles to growth.
For recruiting purposes, human resources can use data shared through social tools to identify the skill sets and attributes that create successful, engaged employees. This information can then be used throughout the recruitment and hiring process, to ensure potential candidates will be a cultural fit.
HR is also using social tools as a part of the onboarding process. During orientation, new employees create their personal profiles on the internal social network and are shown how to find experts on various topics, access information and collaborate on projects with colleagues. Not only does this enable employees to quickly acclimate to their new position, but by incorporating social into their daily work processes from the onset, organizations create future ambassadors and power users of social technologies.
A great example of a company using social tools for human resources is Electrolux, a global leader in consumer and professional appliances, including the Frigidaire line of refrigerators. Having recently moved employees from its Brussels location to a new facility in Stockholm, Electrolux HR created a community on the social business platform where employees created and shared information related to the relocation. Employees were engaged, felt better informed and were more comfortable with the relocation process overall.
Electrolux also incorporates their social business platform into the onboarding process for new employees. This includes creating profiles, tagging their expertise, joining communities relevant to their job function and using the platform to find experts and collaborate on projects. As a result, employees adjust to their new role at a faster rate and instinctively use social tools throughout their work day.
Facilities and Operations
Workplace safety should be a priority for all businesses, not just where employees are operating machinery or performing physical labor. However, safety regulations and procedures often change rapidly, making it difficult for an organization to keep up. These issues can be compounded by a having a large workforce that is distributed across geographical and time boundaries.
Social technologies provide workers with the most up-to-date safety information which is sent automatically via social software on desktop or mobile devices. Communities can also be created to specifically address workplace safety and connect safety experts with employees to share advice or answer questions.
The benefits to employing social technologies to communicate workplace safety regulations and procedures are numerous, including increased production, a reduction in incidents and of course, having a more aware and engaged workforce.
Measuring the ROI of Social Business
As with any business investment, the cost of social technology implementation, operation and maintenance is an important consideration in making sure that company dollars are well spent. The return on investment (ROI) of social media is not a new conversation for marketers looking to track success.
However, social businesses must look beyond statistics traditionally associated with social initiatives, which rely heavily on activity level (for example, the number of shares or growth in engagement). While these numbers are helpful in measuring adoption levels within an organization, they do not show how social initiatives helped grow an organization, spur innovation or increase profits.
Therefore, social business must be tied back to existing organizational goals. For example, CEMEX, a global building materials company, used its social platform to connect over 20,000 employees in 50 countries. Born out of this increased collaboration was the launch of the company’s first Ready Mix brand product, which quickly became a global bestseller in just four months. Had the same level of collaboration been conducted via traditional methods, such as phone calls and meetings, CEMEX would have spent up to an additional US$ 1 million per year in product development.
Another example where social technologies can be tied back to business goals to show true ROI comes from Regeneron, a biopharmaceutical company. After using social technologies to analyze cultural insights and identify skills sets of successful employees, Regeneron was able to meet their goal of hiring 350 scientists during a period of stellar growth.
The company has since used the process to hire more than 1,000 new employees in subsequent years, propelling 10 new drug candidates into clinical trials in record time. Beyond seeing an increase in product innovation, Regeneron has also risen from being unranked, to reach number two in the 2011 edition of Science magazine’s Top Employers Survey.
Businesses must begin to look beyond the limited implementation of social processes and expand them throughout the organization. By coupling this with the ability to measure social activity against real business results, the concept of “social” will no longer be a novel idea, but a necessary and expected function for succeeding in today’s marketplace.
Title image courtesy of TranceDrumer (Shutterstock)
Editor's Note: Read more of this month's focus on what's next for the social enterprise here.