Friday, June 11, 2010

Social CRM Is Only The First Half Of A Social Enterprise

Social CRM has arrived. My fellow bloggers and analysts friends Jeremiah Owyang, Ray Wang, Esteban Kolsky, Paul Greenberg, Sameer Patel, Oliver Marks, Jeff Nolan, and countless others have done a great job in defining the attributes, characteristics, and value proposition of social CRM. The recent acquisitions - Lithium acquiring Scout Labs, Attensity acquiring Biz360, and Jive acquiring Filtrbox - have clearly indicated the market interest in social CRM. There are also tons of emerging start-ups in this domain solving specific problems in niche sub-categories of social CRM.

However, social CRM is only the first half of a social enterprise.

Let me be that idiot for a minute who over-simplifies enterprise software and its evolution. The traditional ERP, MRP, and SCM software were designed for automation and productivity to improve the bottom-line, scale the business, and make informed decisions. The CRM was essentially designed to sell and market better and eventually to support the customers whom you sold to. Then comes the social CRM that is designed as an extension of CRM to help understand customers better, have rich conversations with the customers, increase the impact of the brand, prevent customer churn etc.

Unfortunately social CRM is only the half part of the equation primarily designed to influence the top-line of an organization. The other missing half is the social solutions that support the bottom-line of a company. Together they form a social enterprise. I don’t like the word “social business”. In case you didn’t get the memo, the business has always been social. What is not social is an enterprise. A combination of social CRM that supports the top-line and a set of solutions that supports the bottom-line can truly transform an enterprise into a social enterprise.

Some vendors have attempted to introduce “socialness” in some of the edge applications but I believe there is a need to go to the core and build a true social enterprise. In my two part series I would like to share my thoughts on how this could be accomplished. This is part one.

Focus on the means and not the end:

I can talk about plenty of ERP processes but let’s discuss a specific process that is perceived my many people as dry and not social. It’s the “closing the books” financial process. I would encourage the folks, who think that the financial processes are not social, to spend some time in a large organization to observe and shadow the controllers and a CFO in the last few days and the first few days of a quarter. The software that “closes the books” is the very last step in the process, the end, designed to keep the CEO and CFO out of the jail. Everything that leads up to closing the books, the means, comprise tacit social interactions such as calling cost center managers for their numbers, asking for clarifications, communicate not to do certain things etc. The list goes on. This social system certainly works. However there is one problem – it is highly inefficient.

This is where I see the opportunity to provide a social toolset designed for a specific process – a social vertical – to help all the stakeholders. The social tools should not be designed to replace the face-to-face interactions and should not just be limited to encode the interactions. Instead they should allow people to scale their social interactions, leverage discovery, and experience serendipity. The social tools become the context for the core processes.

Find an internal business process that is inherently social where employees spend most of their time outside of a destination tool. Run with it.

Don't fight the system, instead cater to emergent roles:

As the nature of business changes the great organizations that are on forefront of this change are good about creating new roles that never existed before. Some the examples are Chief Sustainability Officer, Chief Privacy Officer, Chief Customer Churn Officer etc. Enterprise software vendors are often criticized as “pouring concrete into existing business processes”. It’s not a surprise that existing processes are hard to change and existing human behavior is even harder to change but providing a “social-first” experience to these new emergent roles could potentially trigger a positive change in an organization. The people in these new roles don’t typically have a rigid set of pre-defined processes and tools. That’s good news. Work with these people to identify how social software can enable some of these new business processes and functions. As a vendor you are likely to get more traction working with them against working with a CFO or a purchase manager.

Turn involunteer collaboration into social interaction:

Let’s be very clear that being collaborative does not mean being social. Unfortunately the existing collaboration tools help people collaborate once they have decided to collaborate. Well, duh. But when you think about it, if people get along well before they decide to collaborate they have a higher chance of success while they collaborate. The problem is that people neither have motivation nor time to find and get to know the folks that they might be required to work with. This is where social enterprise can do wonders.

The solution that powers the social enterprise does not have to solve a specific business problem. Imagine an enterprise social network that has algorithms to find the like minded-people based on their skills, interest, extra curricular activities, the departments they work for, the cars they drive, the neighborhoods that they live in etc. The real advantage of using such a network is to bridge silos without having an explicit goal of collaboration. This is an antithesis of collaboration.

You don’t collaborate with your neighbors before you socialize with them. You greet them, go to the block party, and have beer and BBQ. And then if you need to collaborate on chopping that tree you do so. It isn’t very different when it comes to enterprises. End of the day the enterprises have human beings that behave like, well, human beings.

Coming up in the next post:

Social enterprise enablement through collaborative content curation, democratizing the management, and earning instead of buying adoption.

5 comments:

freecrmstrategies said...

Chirag,

Good post, and your sentiment has many similarities to my latest post "Circles" http://ow.ly/1XkN9.

Social collaboration (with or without technology enablement) is and has been aligned around a purpose.

This is the real value of the emerging social technology.

Whether that purpose is solving an "internal" or "external" need or problem is only a matter of who is invited to participate in that circle.

Furthermore, the lines between "internal and external" to the enterprise will continue to blur, and technology will help to enable that collaboration.


Sincere regards,

Brian
@CRMStrategies

Nick Parnaby - COO@RollStream said...

Loved the topic. Very current. Need to consider a different nomenclature than "Social" for the B2B or Multi-enterprise Community Management. We find that the term social is still to early to use with real customers who are looking to unite both internal and external parties around real business with trading partners (e.g. Responsible Procurement and Risk Management). However the next killer app is definitely the ability to manage multi-enterprise multi-stakeholder processes. I live it every day and will bookmark you now because you have solid insight.

Chirag Mehta said...

Brian,

I agree with the blurring lines and this is where social CRM has a distinct advantage. The customers are essentially "external". However the internal battles are much harder to fight and I am hoping that social software can help bridge the silos that many companies struggle with.

Nick,

Collaborative Supply Chain Management is an emerging domain and many people have tried to solve the problem of multi-enterprise multi-stakeholders but it's not that easy. I do see significant potential that the cloud computing has to offer for such scenarios of double viral loops.

Larry Irons said...

I agree with you that business has always been social. However, I would add the caveat that that reality was almost always against the best efforts of business leaders. Social Business Design is by far the most fitting umbrella term for those who attempt to take advantage of the collaborative affordances made possible by Web 2.0. However, collaboration is also more than goal orientation.

I think you are right on target to emphasize that social relationships precede collaboration. My own point of view is that empathic relationships are at the heart of effective collaboration and, of course, knowing other employees as people makes empathic relationships easier to manage, and increases collaborative effectiveness.

Satya Krishnaswamy said...

Chirag

Interesting post. One of the areas where I see the need for significant improvement is the ability to plan for and measure the improvements that the 'social' behavior will result in.

While this is still an emerging area and a difficult nut to crack, we have all been through the hype cycles where some hot shot exec gets all excited by a current buzz word and kicks off an internal initiative with no clearly defined metrics - a few months, a few thousand dollars and more than a few bruised and battered employees later, no one knows why the project was kicked off, everyone is in a state of limbo and the next buzz word appears on the horizon. Rinse and repeat !