Enterprise 2.0 – The Business Value of Social Software

I just returned from the Enterprise 2.0 conference in Boston. In 2006, Harvard Business School professor Andrew McAfee coined “Enterprise 2.0″ to describe how organizations could streamline business processes by improving collaboration between suppliers, customers and employees. And the social media applications created in the last 5 years have helped drive McAfee’s vision of exchanging business information with less friction.

What are Social Media applications?

Officially, social media and Web 2.0 are umbrella terms that describe the activities that integrate information technology, human interaction, with the intersection of words, numbers, videos and audio. It’s a fancy way to describe how business processes should be structured to best align stakeholders in a supply chain. To break it down even further; social software creates efficiencies whenever humans interact with a business process.


Enterprise 2.0 has become Business 101.

Last year McKinsey published “Ten Tech-enabled Business Trends to Watch.” McKinsey predicts that social media (i.e., “Big Data”), co-creation of content and cloud computing will have a profound impact on information technology strategies over the next 3 years. As they say, be there or be gone.

The value debate for social media is now behind us. Collaborative technologies (read: “social” or participatory applications) are delivering measurable competitive advantage in established firms as well as creating a whole new generation of less siloed, “fast companies.”

For those of us who are product managers, we’re simply giddy about the development possibilities that social software offers. The ability to embed lightweight apps in place of manual activities means we can sprinkle value like fairy dust to ANY segment of the value chain.

Case-in-point. As we’ve all been involved in a fender bender, well now take heart… because “there’s an app for that.” Have a look at Nationwide’s iphone app. On-the-scene claim filing from your phone. The value to policy holders is self-evident. And the value for Nationwide? A significant decrease in processing effort for claims submitted via this lightweight application. The ROI is off the charts.

June’s IEEE Spectrum timelined that the second era of the Web was launched by search (read: Google). And now comes the third: the era of the Social Web. The stage is set for a battle of, well, epic proportions. The wizards at the Googleplex in Mountain View, Calif and their Palo Alto neighbors are working at a dizzying pace to create social networking apps that deliver capabilities at lower costs.

Social Media powers Enterprise 2.0.

Recently, I visited Microsoft’s Research Fuse Lab in Cambridge. I saw firsthand how social media was being embedded within an engineering CAD/CAM application to connect communities of engineers.

Here’s how it worked: A designer experienced a problem with a hydraulic valve in a CAD/CAM design. An embedded social networking component in the workflow allowed the designer to ask a question (as well as visually display problem) to other engineers throughout the world. The engineers collaborated as if they were in the room and solved the problem in minutes. Without this social media capability the issue could have delayed the project for hours or even days. The social app embedded inside the CAD/CAM enterprise workflow allowed the designer to use extensive social connections – either inside and outside the firm – to solve problems and be more efficient. The ROI? Yep, you got it… off the charts.

Saba, the talent management company, recently won an award for their social collaboration suite. This 3-minute video illustrates how social media can be used for resource management. Have a look.


Social Media for Employee Engagement.

While social media is being deployed primarily in ways that impact direct business operations, it’s also used for softer employee engagement activities, replacing dated phone directories and manually maintained hierarchical organizational charts. Research has shown that when staff connect though social applications across organizational and geographic boundaries, they can find resources, get questions answered and discover their colleagues’ expertise more easily. What’s more, communications between staff can be systematically scored, ranked and woven into the information fabric that can be referenced and used across the firm.

Connecting employees via social apps is becoming so prevalent that many companies are developing plans to eliminate email as a communication platform inside the firm. The ROI? (Do I need to say it?)

French consulting and services company, Atos Origin, has similar designs for a social media transformation. Chairman and CEO Thierry Breton wants to eliminate internal e-mail from the company within three years, replacing it with social platforms, he announced in February. “E-mail is on the way out as the best way to run a company and do business.”

Social is now.

The competitive advantage that social media deployments are having have prompted companies to move quickly toward adoption. Quicker than any application segment that I have witnessed in my career. According to McKinsey, the Web 2.0 / social media wave could have a greater impact than the large technology adoptions of the 1990′s such as enterprise resource planning (ERP), customer relationship management (CRM), and supply chain management applications

Oracle is even bolder. Oracle predicts that firms who don’t move toward Enterprise 2.0 will become obsolete. “Competitive advantage today is not achieved through command, control and operations. It is realized through collaboration, communications and management excellence.”

Time to Business.

Product Managers, you know what to do. As the product sage Seth Godin reminds us… polish those resumes and then go make something happen. It’s time to go supersonic.

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