One of the greatest aspects of my job is that I am able to regularly take a deep dive into some of the difficult questions of the day, sometimes providing research and insights into the social networking and enterprise collaboration questions on the minds of analysts and executives alike. Today's question? What is the return on investment (ROI) of social?
It's not a new question, but the data shared by social technology vendors and practitioners alike leans heavily toward anecdotal data and qualitative impressions, rather than present quantitative data and hard numbers.
Trying to Get the Numbers
While attending the E2 Conference (#e2conf) in Boston this week, several presentations once again tried to address the issue, with panel participants sharing some of their real-world experiences in measuring the benefits of social in the enterprise.
In a panel event led by InformationWeek Social Business columnist and editor David Carr (@davidfcarr), panelists Vishal Agnihotri from KPMG International, Kristin Waryas from State Street Corporation and Gloria Burke from Unisys Corporation shared some of their insights into the measurement of social ROI. The consensus of the panel was that social is more about marketplace agility, heightening customer service across various organizations (from an internal perspective) and within customer interactions (external).
During Q&A, I was able to ask the panel whether they had attempted to build quantitative proof of business value, or whether their internal metrics were based entirely off of qualitative improvements, which might be viewed as subjective, weakening the business value of the metrics (and therefore the business value of social) in the eyes of some executives.
Gloria Burke, Director of Knowledge and Collaboration within the Strategy and Governance group at Unisys provided a great response, indicating that her company went to great lengths to put specific, quantifiable measurements in place using the mean time to resolution (MTTR) of tickets as an example. In her example, when a customer ticket is opened that requires subject matter expertise (SME) knowledge beyond that of the customer service representative, the MTTR metric is generally very high as the rep makes efforts to identify the right SME within the organization, and then to either reassign or resolve the ticket.
For Unisys, a key measurement of social technology was reducing the time it took to enable people to find these SMEs. Her organization could then look at the downward trending MTTR metric, and extrapolate that time reduction within a given week or month multiplied by the average cost of that customer service representative, providing a cost savings due entirely to their social tools.
Other quantifiable benefits mentioned were identifying and reducing redundant work, reduction of time spent within workflow and business process activities through more open and visible communication, and reductions in overall project timelines due to improved SME alignment and improved communication. All were activities that could be tracked, measured and dollar value (savings) applied.
Adoption Isn't the Whole Picture
I work closely with someone who is very knowledgeable about the social collaboration space, having worked in product management roles on the Lotus Notes platform, the Groove platform prior to acquisition by Microsoft, and then on SharePoint Workspaces (formerly Groove Workspaces) and other “social experience” features now available within the SharePoint 2013 platform: Donna Shaw (@donnasueshaw), Principal Product Manager for Axceler. Donna is helping to develop social governance and visibility features within the ViewPoint Enterprise platform. With such an extensive background in collaboration technology, Donna has had more time than most to ponder the social ROI question.
I asked Donna how customers she speaks with on a regular basis are approaching the question of ROI:
From the customers I have talked to, they are struggling with this a bit. Without a way to monitor usage and activity, it’s tough to make the good ROI story. There are definitely products that provide some measurements and analysis, but not always as deep as what people would like, especially as it pertains to ROI.
It’s helpful to measure adoption. The idea that you can see the number of users who have joined the network and the number of groups that have been created is just a piece of that. The additional value is seeing the growth trends over a period of time.
But the adoption numbers alone don’t tell the whole story," she continued. " Sure, it’s helpful to see that 50 users joined the network and 15 groups were created, but without seeing the activity and usage of those groups, you really can’t validate the ROI. Add to that measurements on user activity and you have a more complete picture.
There is one other aspect that a customer brought up to me around ROI and that is the idea of measuring what topics are trending and popular. Her example was that in her company, the R&D team had requested Yammer for their group because they had a distributed team and needed a way to collaborate asynchronously since the team was spread across different locations. The team felt it was invaluable using Yammer as a way to share information, ask questions, review content, etc. She mentioned that seeing topics like 'research,' 'product' and 'development' as tending topics confirmed that the R&D group was indeed using their Yammer licenses, thus validating the ROI in purchasing those licenses."
Also participating in the E2 Conference this week is SharePoint social category-leader Newsgator, who just announced the release of NewsGator Social Sites 4.0, which includes new capabilities and analytics that extend the social experience across business process management (BPM) activities (such as workflow approvals) and mobile devices to help organizations improve productivity, increase adoption, and advance overall end user engagement.
I was very interested to learn about how a leader in the enterprise social space was addressing the ROI question, and was given an overview by members of the product marketing team who walked me through the latest features, some of their future product roadmap, as well as their enterprise adoption framework -- a combination of analytics and surveys to help organizations benchmark the state of collaboration within their business, and track improvements over time.
The goal of this framework -- developed in partnership with some of their largest customers -- is to help a company better understand which social messages are resonating, how engaged users are with that messaging (how many read it, share it, comment, rate it, take action on it) and, ultimately, the quantitative benefits that these social activities bring to the business.
Allowing for Happy Accidents
Across the board, all of these experts and experienced customers pointed to one important factor to successful measurement of social: you need to understand the underlying business objectives. At the recent SharePoint Saturday Chicago Suburbs (#SPSChicagoBurbs) event, ManyWorlds CTO Naomi Moneypenny (@nmoneypenny) presented on the growth of enterprise social, using Yammer's rapid growth to illustrate the increasing focus on social collaboration in the enterprise and why it’s a good thing for innovation and communication, reducing or removing some of the vast organizational data silos.
As Naomi identified, enterprises are huge social systems, with vast personal and project or data-driven networks, where “innovation comes from serendipitous connections," or "happy accidents" between people, teams and projects. It is within these "happy accidents" where innovative discovery happens -- and only so much of this can be planned. She explained that one goal of every company should be to provide opportunities for these “serendipitous connections” to occur -- and then to get out of the way.
Social collaboration, using platforms like Yammer, Tibbr, IBM Connections and Chatter, according to Ms. Moneypenny, is about removing these silos and allowing everyone to participate in the corporate dialog, creating more of these opportunities for “happy accidents" where innovation occurs. She distilled the purposes of social networking in the enterprise down into four main points:
- Decentralizing decision-making (to the people closest to the problem)
- Aligning employees along higher-level motivations, beyond process
- Creating a culture of transparency, with constant improvements
- Engaging employees for ideas
Adding complexity to almost every organizational effort to measure and quantify the benefits of social is the sheer complexity of tools, platforms and other consumer-focused solutions that may have found their way into the enterprise. Stated Donna, "Since organizations often have multiple social and collaboration products being used across the company, the idea of seeing measurements for adoption, activity and influencers federated across multiple platforms is not something we've really seen yet, which is why ViewPoint is tapping into something pretty new, providing that greater level of visibility."
Ms. Burke did offer some words of warning about focusing too much on the quantitative measurements, rather than a balanced approach that includes qualitative benefits:
If you say that you have to have a number, you're going to focus on the wrong things. There are portions of social that cannot be measured. The value is in what you're investing in those employees -- attracting new top talent, giving them opportunities to learn from people, to participate in that knowledge transfer. What is the value of being able to quickly ramp up junior people, to help them learn more quickly from senior people?"
What role does governance play in social today, and what metrics are critical for every organization to expect to see as they benchmark their social activities and try to understand their own social ROI? This is a tough question -- one that requires a balanced approach between data and cultural fit. According to Donna,
IT and business leaders definitely want some sort of control, but not at the risk of stunting adoption and usage. Adoption tells you how many users joined the network and how many groups or sites were created and yes, over a period of time, but those numbers don’t tell you if the product is actually being used. Adoption coupled with engagement, which shows the level of activity within those groups and sites gives a more complete picture -- really validates the ROI.
Still, the things I've heard have mostly been around protecting the company’s IP (intellectual property). Is someone talking about or sharing something either internally or externally that they shouldn't be? How can those who need to be concerned about this protect the company? You can't necessarily prevent this from happening, but you can be notified when it does happen and then take the appropriate action. This is a tough one."
What is clear from these experts is that the ability to quantify the benefits of social in the enterprise is still a work in progress, but improving rapidly. Companies are looking to automate many of these analytics in a way that makes it easier for organizations to see the direct impact of social on their business objectives, and how increases in cross-team collaboration and overall communication can directly affect the bottom line. Social analytics is a category to pay attention to.
Edited title image courtesy of ollyy (Shutterstock)