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The Benefits of Becoming a Social Business

social_business.png January 23, 2013 / Mikael Lauharanta

I recently read an interesting MIT Sloan Management Review research report titled Social Business: What Are Companies Really Doing? The report was done in 2012 in collaboration with Deloitte and it is based on an extensive global executive study.

Its focus is heavily in the possibilities social software has to offer for internal communication. In this blog I'd like to point out a couple of the key findings from the survey and reflect whether some of the findings could be utilized to improve the external processes of companies instead of just embracing social internally.

 

What is social business?

First of all, I like how the authors clearly and nicely define social business. The term isn't new and along the way it has started to mean different things for different people. In this case social business is defined as "activities that use social media, social software and social networks to enable more efficient, effective and mutually useful connections between people, information and assets". In the end, social business is all about creating meaningful connections between people that can be used to achieve business objectives.

Online social business on computer

Later in the report the authors quote Hewlett Packard's CEO Lew Platt who once said "If only HP knew what HP knows, we'd be three times more productive". This of course refers to the internal communication silos inside the organization, but I instantly thought why couldn't this be turned upside down from the HR perspective, for example? If everybody knew what HP stands for and what's it like to work at HP, wouldn't they get more engaged applicants that fit the company culture better? This would save HP, or any other company for that matter, a lot of money in the recruiting process. This quite recent shift from employer branding to culture branding is well crystalised by Mr. Michael Long, Head of Global Employment Branding Initiatives at Rackspace, in one of the most eye opening Slideshare presentations I've ever encountered. A company's goal should be to depict themselves as accurately as possible since the longest lasting and most engaged employees are those that fit that company’s culture.

 

Where do you find expertise in your organization?

Another interesting survey result I want to highlight is the answer to the question above. By far the most popular answer was: I use my personal network. This is again something that can easily be transformed to fit recruiting purposes as well. The most competent prospects are probably your employees' former colleagues or classmates and can be found and reached through your employees' professional networks. After all, the most common reason to join Linkedin, for example, is networking with other business professionals.

In my work as the COO of Smarp, I help companies improve their employer brand and their recruiting and marketing communication efforts through increased employee engagement on social media. Due to my background, I found the internal reasons for adopting or not adopting social software among the most interesting findings in the research report. The results also heavily support our real life experiences. Management support and a clear vision of how the social solutions support business strategies are crucial in the decision making process. However, there is some contradiction to the results between qualitative and quantitative research methods. In interviews, many executives state that they don't want to stare at direct returns from social software investments since they are only experimenting with them. On the other hand, the survey results clearly indicate that if there is no clear business case for implementing social software solutions, the company is not willing to adopt them or experiment with them. Another finding supported by our own experience is that even though there is some fluctuation between different industries and functions inside the company, the overall trend is clear - companies acknowledge and believe that social software will be important to their organization within the next three years regardless of the industry.

 

Social software

Last but not least I was stricken by the results to the question: To what extent do different functions drive adoption of social software within your organization? Marketing and sales were obviously in the lead, but to my amazement, HR was in the middle of the pack barely above functions such as General management and Operations. Although management level support is essential to adopting social software in large organizations, pressure from the ground up from functions such as HR, where the results and returns can be very clearly demonstrated, is the only way more and more companies can become social in the literal meaning of the word and tap into the collective intelligence and networks of their human capital.