Social networking is the worst place to start a social businessby
When it comes to social business, vendor Jive is certainly no Johnny-come-lately. In fact, the Palo Alto-based software firm was selling its wares before the term ‘social business’ was even coined.
Founded in 2001, it was primarily involved in real-time communications and forums in its early days. But as its work creating customer forums for the likes of Sun Microsystems started to really take off, there was a realisation that there was a growing demand for fresh ways to engage more closely with customers.
This, says Chris Morace, chief strategy officer at Jive Software, was the nascent stages of the “social revolution”, and something that the company copped to pretty quickly after receiving their first injection of external investment.
“2007 was when things started to go vertical,” he explains. “Jive rolled out a platform for employee collaboration and then later that same year it rolled out the platform that would replace the forum product, and introduced partner communities that has ended up with all the existing products. So things had started fractious but really exploded in 2007.”
The area of ‘social business’ subsequently became a huge topic, with a growing enterprise appetite for social and collaborative solutions. Morace is unsurprised by this.
“I think the last 20 years were dominated by vendors that succeeded in the PC environment,” he explains. “Now in these days where we’re all connected and mobile and Cloud-based, and sharing information, there is a different way to do it.”
He continues: “The old pillars of the enterprise was the idea that we have to have desktop computers – that is what Outlook and Sharepoint were born on and that’s what most of us know. But we now have a reality where we have multiple computers and we are constantly connected, yet arguably the way we use them is still just like on the desktop. So what is happening now is that we’re reimagining how you want to be able to collaborate, right format, right time. It’s just maturity that has held it back.”
Nonetheless, with social business becoming “unrecognisable” from its early days, Morace concedes that this has bred confusion.
“It has moved so quickly – from the collaboration perspective through pioneers such as Jive and IBM, then over time it evolved into social networking and then a lot of the Cloud social networking came in and that kicked up so much dust that people have got really confused about what we really use these things for,” he says.
Morace continues: “People don’t understand the different classes of technology and what you should use it for. There’s a different approach for B2C than B2B, which is confusing. And depending on where you start, the way you measure it can be different and the way you roll it out is different.”
This, he insists, is arguably the most difficult part of a typical social business project, and Jive is now quite prescriptive about how enterprises figure out where in their company they should start. “Social networking is where a lot of organisations try to start, and it’s actually probably the worst place to start,” he adds. “It’s much easier to start with more discrete areas and then build up to that. The change management is too large otherwise.”
He has the following advice for organisations looking to start a social business project. “The two places where we see a lot of success in almost every company is either starting with a customer touchpoint or, if you’re going to start internally, start at a mission-focused collaboration - because you understand what you’re doing, everybody is clear and no-one is questioning why you’re doing it. If you’re using it to do deals – great. If you’re using it to manage your marketing campaigns – great. But ensure you have top-down commitment before you do it.”
Measuring return on investment
Getting this kind of executive commitment hasn’t always been easy, however. One of the question marks that has hung over social business has been just how measurable its benefits are. And of course, if you can’t measure ROI, it’s hard to be on the right side of the bean counters.
But Morace insists that concerns over ROI measurability are over-estimated.
“The customer-facing ones are easy – customer service metrics are super clear and commerce metrics are really clear. Usually the partner enablement stuff is also pretty easy, whether it’s indirect channels for a company trying to sell more of their product or a brand trying to sell more through their partner channel. If it’s the collaboration and mission-focused work, it’s easy and we have tons of help for how to measure it.”
However, he adds: “When you get into the strategic alignment or social networking for workforce engagement, then it becomes harder. These are softer metrics. And that’s why I think that if the top of the company is not convinced it’s something they should do, you shouldn’t start there. You can tell it’s working, but how do you really measure the impact of it?”
At the measurable end of things, however, Jive has customers that have demonstrated increases not only in productivity but also revenue as a result of the tools. In particular, Nike, Premier Farnell and PwC have provided strong evidence of the direct financial impact that social business tools can have.
“Being a consultancy, PwC cared about one thing first and foremost and that was whether they could win more business,” explains Morace. “They had three clear measurements – can we increase the amount of deals we can bid on concurrently, can we shrink the time it takes us to bid on that deal and then can we win more. And it became a great use case for the technology because in order to win that business, PwC has to coordinate expertise from throughout their 200,000 person company. But they were able to improve all of those, and in most cases by more than 30%.”
He continues: “In terms of revenue lift, there is also the example of Premier Farnell, who tied the commerce platform to their community, with easily measurable results, because they can see that when they engage with people in this way and in this context, they spend more. They deal with electronic components, and they would connect with experts and share what they were trying to build, and they discovered that if they shared what had been built and listed the parts that were used, people wouldn’t look for the parts elsewhere, as they could just click on the part and buy it in context. So again, very easy to measure.”
So with social business gathering momentum, and more businesses coming around to the benefits, it has been an exciting journey for Jive. But Morace believes there are still barriers to break down before social business becomes a truly giant market.
“I didn’t anticipate how fast some of this stuff would hit – but I also didn’t anticipate what it would take to give up the old stuff,” he notes. “Up until now, most of what we have been doing has still just been overlaid on top of legacy technology. Businesses haven’t given up Outlook yet. They haven’t given up Sharepoint yet. So it’s only now that people are really starting to see a future where they don’t need those things. And that’s when we’ll see it accelerate again.”
Neil Davey is the managing editor of MyCustomer. An experienced business journalist and editor, Neil has worked on a variety of newspapers, magazines and websites over the past 20 years, including Internet Works, CXO magazine and Business Management. He joined MyCustomer in 2007.