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Social business design: An introduction to the future of your firm

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23rd Jun 2011
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Lee Bryant looks at how social business design is cutting costs for large enterprises, and bringing them closer to their customers.

When it comes to lessons learned from the recession, right up there alongside "the global banking system isn’t infallible" is "large corporations are very expensive to run".
With the benefit of hindsight, it is clear that while operating comfortably during the boom time, many organisations had unwittingly developed increasingly bureaucratic systems and processes to serve customers and organise their workforce. And all of this came home to roost once revenues took a nosedive.
 
These problems seem particularly acute when making pound-for-pound comparisond of large corporates to start-ups, with internal cost bases far higher in enterprises compared to those organisations that have been built from the ground up with a much more technologically-driven way of working.
 
And there are also implications for the extent to which the organisation is customer-centric, says Lee Bryant, co-founder and director of Headshift, part of the Dachis Group which is the world’s largest social business consultancy.
 
"If you are a relatively customer-centric organisation then you want to be close to your customers’ habits, behaviours, likes and dislikes; tweaking your products, services or processes to make them happy," he explains. "The first wave of CRM was an attempt to do that by gathering data, but we have learnt since then that a lot of it is actually behavioural. If you can make customers feel they have a role in the business and that their voice is heard, you can make them slightly less price-sensitive and derive more loyalty from those relationships.
 
"Clearly there is potential here to reduce customer acquisition costs, reduce churn and also potentially reduce costs because they are doing part of the work in the value chain. Contrast this to the world of contact centres where companies have very elaborate internal processes to manage a customer and they do everything they can to actually avoid having a conversation with the customer, which is both costly and frustrating on both sides."
 
Time for change
 
Not surprisingly, large enterprises are acknowledging the need for change. Bryant notes that there has been a surge in involvement and engagement by senior leadership within organisations. "More and more high level strategy work is seen as a lot more central to how companies change themselves," he says. "Many companies are very much of the view that they need to change themselves if they are to protect against young upstarts in their markets."
 
One of the paths that organisations are taking to architect this change is the burgeoning field of social business design.
 
Most corporations are still largely based on late 19th and early 20th century conditions, but these have of course changed enormously – communication, for instance, is much easier that in the past, and many start-ups reflect this by being networked from the very core to enable individuals to have a much greater say in how things are run and how they get their tasks completed. Meanwhile, the consumer’s use of social tools over the past five years or so has provided organisations with plenty to learn from in terms of technologies and behaviours and new possibilities.
 
Social business design asks organisations to reappraise the way they are designed in light of these changes - it encourages them to rethink the way they design workforce systems, for example, and requires them to embrace collaboration and common purpose systems, and consider how the corporation can design its own tools to engage with customers or reach out to its wider ecosystem.
 
"In a way, it is partly communications, partly management consulting and partly relatively advanced social technology – and applying those three in equal measure to help things modify or reform the structure of organisations," explains Bryant.
 
"There are three domains, although actually the principles and even the technologies that you apply across each broadly similar. We understand the world of internal workforce collaboration - we have intranets, document systems, knowledge systems and communication systems, so there is a great potential to revitalise internal technology and internal infrastructure so we can build the fabric of a 21st century organisation. On the outside of the company, many people have experimented with using social tools and networks to engage customers so we need to continue that and build on that and begin to connect that together with the internal world of workforce collaboration. And then there is the ecosystem play - dealing with your partners and supply chain and so on - which is kind of a hybrid of the other two, and is partly inside and partly outside the firewall so to speak."
 
Next generation business operating system
 
To a greater or lesser extent, many enterprises are already involved in many of these projects, of course. Certainly there will be some degree of internal collaboration systems. And there is also the small matter of the growing adoption of external social tools. But in most cases, these domains exist independently of each other. Furthermore, while blogs and wikis and social networks may have been around for a while, they are not always integrated properly into existing systems and processes, and crucially they may not provide a good user experience, or a solid value proposition, for the people who are required to participate on the systems.
 
While these projects have to start somewhere, of course, what social business design is tasked with is making these areas work together as part of a next generation ‘business operating system’, integrating the tools into the flow, rather than above the flow, and delivering a "consumer grade experience" with a very clear value proposition as to why the tools should be used.
 
"If you look at the internal systems that run a large company, there will be document sharing with document management systems, and communications systems and intranets and so on. But they are very heavy and very internally focused," says Bryant. "The vision of a future business operating system would first of all be networked, so you have a strong but relatively unstructured internal social network within the organisation so that people can just find each other and get work done regardless of the process that they need to go through to achieve that. But another vital part of that is feeding in live real-time customer insights and analytics so that each person in the company has a degree of customer-centricity, rather than just the marketers or just the customer care people."
 
Recently we have witnessed the increasing popularity of social media monitoring. But one of the problems that is emerging with the use of these tools, is that when they tend to reside within one department – often times marketing, where they are used to build reports on customer behaviour and preferences – the means to socialise the findings within the company are lacking. This is a real limitation, says Bryant, but one that can be solved.
"If enterprises can find ways of piping all of that goodness all the way around the company and encouraging all employees to stay connected with customers and also to act on the insight that derives from monitoring then I think you have got a more agile and more direct model of running the organisation and also potentially a much lower cost model as well because the kind of byzantine processes that you need to run customer care and run customer contact and so on, become a little bit simpler and a bit more direct."
 
Organising for social
 
With senior leadership starting to embrace the idea of social business design, the movement is steadily gathering momentum. Furthermore, we are also seeing social modes bleed into a growing number of different kinds of systems and software, internally and externally – a sign of a maturing field. Of most excitement to Bryant, however, is the level of organisation that is emerging, with unified programmes beginning to replace the patchwork of disconnected activities in different departments.
Nonetheless, for the majority of enterprises, it is this issue of ‘organising for social’ that remains one of the biggest challenges to overcome if they are to modernise the design of their business. Bryant has the following checklist for those firms who are committed to the process of change.
 
1)      Have a goal. "What are you trying to achieve? What kind of KPIs does it speak to, how do you measure that and so on."
2)      Establish ownership and get top-level buy-in. "Who owns it? Much social business activity began in the marketing department, some began in the IT department, some might be floating around HR. But really what it needs is a view across all of those functions and more. So giving it a seat at the top table is always a challenge."
3)      Get the strategy in place. "The kind of strategy work that we do is about how we define a programme and how we measure that programme, and then how you roll out individual projects that can start to achieve some of those objectives."
4)      Data is key to all of this. "One of the most interesting things in CRM at the moment is the whole field of social CRM and how you can leverage vast amounts of soft behavioural data both inside and outside to augment the limited hard data that you might have about a customer or partner or even employee and then learn what motivates them, learn how to connect with them, where to connect with them and what likes and dislikes they may have about participation."

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