Posts Tagged Facebook

Measuring the ROI for Social Networks

Business use of social networks, also referred to as social media or just plain social business, refers to the use of the Internet in myriad forms to interact with the organization’s various stakeholders. These typically are employees, suppliers, partners, or customers.

IBM describes a social business as one that “embraces networks of people to create business value.” It involves sharing, transparency, innovation, and two-way interaction. The objective is improved communications and collaboration that should lead to higher productivity, improved products and services, better decision making, and ultimately greater revenue, market share, and profits. Social business is a key component of IBM’s 2011 Tech Trends Report, here.

A recent University of Massachusetts survey, here, on Fortune 500 companies found that they already were engaged in social networking: 23% had an active public-facing corporate blog, 62% had active corporate Twitter accounts, and 58% had Facebook pages. In addition, companies have been deploying social networking tools like Yammer or IBM Connections in house. All this social networking raises the question: What’s the ROI?

The IBM Trends study suggested that the majority of organizations turned to social networking mainly to benefit from increased efficiency and to streamline collaboration. Often the companies began by deploying social networking internally (behind the corporate firewall). Even if they have outward facing Facebook, Twitter, or corporate blogs, the serious experimenting with social business was happening safely inside the company.

These initial deployments had three primary uses: 1) employee collaboration, 2) efficiency in locating people and resources, and 3) idea generation and sharing. The technologies they mainly used were file sharing, blogs, and online (intranet) forums. Nothing unusual or complicated or costly. Many of the social networking products like Yammer even are free for individuals, which is why workers may sign up on their own. (The enterprise versions entail charges but deliver more capabilities.)

Figuring out the ROI for social networking is challenging. People have always collaborated. If you collaborate a little bit faster or a little bit more easily than before what is the incremental value gained? To understand the ROI of social networking you need to look at it as a business process, not as an IT project.

Rather than try to calculate a technology ROI, you need to look at the return on collaboration and the value of knowledge access and skill sharing. If a streamlined collaboration process enables employees to work more efficiently or more productively, there is value that should be measurable. Similarly, if social media enables the organization to more efficiently find and tap the knowledge and skills of its workers and share that widely and more quickly, again there should be something that can be measured and given a value.

What is the value of a better interaction with a customer or with a valued partner or supplier?  These are areas where social networking can help. Or, what is the value of learning what people think of you or your products, good or bad? Again, this where social networking can help.

At a recent social media gathering a manager from Lowe’s, the home improvement store, described its use of IBM Connections. Mainly employees use it to locate other employees who have specific knowledge about a product or problem. The value came from the ease and speed by which an employee could find the information needed to satisfy a customer. In some cases, it might save a sale. In other cases, Lowe’s would have gotten the sale anyway. But overall, the interaction process with the customer improved.  Social media, he insisted, simply requires a different way of looking at ROI.

In an upcoming piece BottomlineIT will look at guidelines and practices for getting the most out of social media.


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Consumerization of IT Comes to the Enterprise

Do people use their smartphones at work? That’s an example of the consumerization of IT. Does the company recruit employees or interact with customers through social media like Facebook? More consumerization of IT. How about invoicing and payment or procurement through cloud-based exchanges like Ariba? Same thing.

A Unisys study two years ago hinted at the consumerization of IT in the business. An online poll of more than 500 enterprise information workers showed a majority prefer using their own PC or a hosted virtual desktop to do their work and to access information resources. Only a minority continues to subscribe to the traditional model of using a PC provided and managed by their company.

 A more recent Unisys study in conjunction with IDC dubbed this trend Consumer-Powered IT, and already it is turning the traditional IT business model on its head. Unisys expects it will transform organizations over the next 3-5 years while bringing in a new wave of business productivity. The question become if and how IT should respond to this trend. Ignoring it, a favorite IT strategy of the past hasn’t worked then and won’t work now.

Last year Unisys described the consumerization of IT as “perhaps the most radical transformation sweeping the technology landscape and enterprise IT.” BottomlineIT wouldn’t go quite that far—early personal computers running a spreadsheet called VisiCalc (1979) drove modern desktop computing into the enterprise, which proved to be pretty radical at the time. The PC running VisiCalc might have been the first example of consumer-inspired IT.

By the mid 1980s workers expected arrive at work on their first day to find the company provided and supported desktop computer. Now workers are showing up with their own apps running on their own devices; a smartphone, iPad, or other tablet devices. They handle their own email, messaging, and social networking through their devices, and they expect their employer to let them connect to the corporate network as well. They expect to add their work apps to the personal apps already residing on their preferred device.

This represents a stunning turnaround. The organization, in effect, has lost control of its technology strategy.  Such consumer-powered IT, as Unisys notes, exposes a troubling gap between the activities and expectations of these workers and their employers’ abilities to manage, secure, and support what amounts to a blurring of personal and business communications and compute activity. The upside: greater productivity through new ways of connecting and collaborating and increased competitiveness through the workplace innovation that invariably follows.

The downside is loss of control and a need for new ways to reassert control. The IT group will need to interface with and support this disparate collection of devices. The company also needs to devise a layered security strategy and redefine its governance policies to encompass these new and varied ways of working so compliance mandates can be met. An investment in new management tools is likely.

When handled right, the consumerization of IT can spur valuable innovation. Take two newly hired workers who encountered a problem when inspecting a facility, pulled out a smartphone, snapped some photos, and emailed them to the appropriate people along with brief explanatory text. Suddenly the new hires had demonstrated how to streamline a vexing business process and bypassed tons of paperwork.

The Internet, the World Wide Web, Google, Facebook, Twitter, eBay, Skype, even the cloud have been driven by consumers. It will become the way your organization receives and delivers services in the future. Start preparing now for the new connected smartphone, tablet, swipe-and-tap world of business computing.

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CIOs Have Reason to Worry About Social Media

The wisdom of a famous Boston politician—I don’t care what they say as long as they are talking about me—certainly does NOT apply to social media and today’s business organizations. To the contrary, according to a recent poll from data protection vendor Symantec,  the typical enterprise experiences nine social media incidents with 94% suffering negative consequences including damage to their reputations, loss of customer trust, data loss, and lost revenue. What gets said about your organization on social media indeed matters.

According to Gartner:  by the end of 2013, half of all companies will have been asked to produce material from social media websites for e-discovery.” That means enterprises need an information risk management governance strategy that specifically includes content created on social media.

The Symantec poll revealed that social media is pervasive within the enterprise, and CIOs have good reason to be concerned. At a minimum the organization faces increased litigation costs and risks. And the costs aren’t trivial; the poll found social media incidents cost the typical company $4 million over past 12 months.

The knee jerk reaction is to retreat from social media. That’s not a good idea. It would mean forgoing the considerable benefits to the organization’s brand and from customer engagement. In some cases, social media even drives the ringing of the cash register, especially when used as a major component in a multifaceted marketing campaign.

A better reaction is to develop a comprehensive strategy addressing policy and monitoring, governance and risk management, and archiving that includes social media content as well as email and conventional documents. This will entail a combination of effective management execution and investment in the deployment of new technologies.

The payoff, however, can be significant. Take just the top three social media incidents the typical enterprise experienced over the last year:

  1. Employees sharing too much information in public forums (46%),
  2. Loss or exposure of confidential information (41%),
  3. Increased exposure to litigation (37%)

More than 90% of respondents who experienced a social media incident also suffered negative financial consequences as a result. These included a drop in stock price (average loss: $1,038,401 USD), added litigation costs (average: $650,361 USD), direct financial costs (average: $641,993 USD), damaged brand reputation/loss of customer trust (average cost: $638,496 USD), and lost revenue (average: $619,360 USD).

How to avoid this: establish a social media policy, communicate it, and enforce it; then integrate it with your enterprise risk management and governance strategy; and finally, deploy policy-driven tools to automatically monitor social media activity and electronically archive social media content.

The key adult social media to watch today are Facebook and Twitter, but also LinkedIn and now Google Plus, which has the potential to change the social media landscape. In an upcoming post BottomlineIT will take up Google Plus and its possible ramifications for IT.

Please note that BottomlineIT will be on vacation for the next two weeks. New posts should resume the week of Aug. 15.

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IT in the Post-PC Era

Judging from the latest research, it looks like we’re about to enter the post-PC era and taking us there is the smartphone. According to Gartner, 2011 is the year of the smartphone. Gartner projects 95 million smartphone sales this year, up from 67 million in 2010 compared to 50.9 million PC sales. For now, devices like the Apple iPhone or the Google Droid will usher in the post-PC era, not the tablet device despite the recent hype around tablets like the Apple iPad or Motorola Xoom.

A year ago an article of mine suggested that your next PC might be a smartphone. It appears to be happening faster than the WiFi providers can build out their networks.  The WiFi network at Mobile World Congress a few weeks back apparently was saturated and slowed to a crawl. Even the WiFi network at my local Starbucks sometimes seems to choke.

But WiFi network constraints aren’t slowing down some organizations. Wells Fargo reportedly is ramping up a mobile payments pilot using selected iPhone and BlackBerry models. Is IT ready to handle high volume transactions and payments via smartphone? It’s coming.

WiFi congestion, as it turns out, shouldn’t be a long term constraint. The big problem is with free WiFi, but smartphones can also use the cellular phone network to surf the Web, for which customers pay an extra $30-$50 a month. At that price there will be plenty of bandwidth.

Gartner clearly is bullish on smartphones. One report has Gartner predicting that US consumers are more likely to buy a smartphone than any other device due to the ongoing price wars that keep prices down and the popularity of smartphones for applications like email, Web surfing, Twitter, Facebook, GPS, and games.

In the early days of PC adoption ease-of-use was a major barrier to adoption. Smartphones beat the ease-of-use problem from the start. If anything, early iPhone adoption was driven in large part by its slick, intuitive user interface. With a few glaring exceptions, the other vendors have done reasonably well imitating the iPhone’s ease-of-use.

The first question facing the organization considering smartphones is which device. Unlike the PC, there is not yet a standard OS or device. Each vendor’s device will require specific support, which could turn into an IT support nightmare unless the organization standardizes on one. The main selection criteria are reception/coverage and apps availability.

Beyond that, organizations need to consider security, governance policy, new app development, and integration with existing applications. Each raises significant concerns. For example, smartphone users already are developing apps to solve little, annoying business problems, a phenomenon Gartner calls citizen developers, or worker developers.  But these apps are being developed outside of IT, which can either embrace such innovations or fight it, which ultimately will be a losing battle for IT.

Can the organization adopt the smartphone today as a replacement for the laptop or desktop? It depends on the particular users. For users only doing email and Web surfing (and phone calling, of course), sure. For those working in any serious way with documents, spreadsheets, PowerPoints, or enterprise applications, probably not yet and maybe never. We may be on the cusp of the post-PC era but plan to hold onto your laptops a bit longer.


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