Social Business is a recent but popular trend revolutionizing the way companies function and generate value for all the constituents (stakeholders, employees, customers, partners, suppliers).
What is a Social Business?
Reconciling some of the most interesting business, organizational and technological phenomena of the last five years, a Social Business is
An organization that has put in place the strategies, technologies and processes to systematically engage all the individuals of its ecosystem (employees, customers, partners, suppliers) to maximize the co-created value
This definition tries to underline that:
- The historical Manichean separation between the inside and outside environments of a company is losing importance. Moreover, the privileged role for those ideas and decisions that the organization pushes to the market (inside-out) compared to the reversed flow of indications that from the market reach into the company (outside-in). The flow is now effectively two-way and becoming realtime The decision making and change management responsibilities are no longer restricted to managers (traditional organization) or to customers (as prescribed by Social CRM). Other than managers, organizational change can be driven equally by customers, employees, partners and suppliers. All these categories are moving from supporting actors to partners and protagonists
- It’s engagement not communication that makes the internal/external flow possibile. Getting individuals engaged means accepting a variety of needs and using those needs to inform the organizational growth and evolution
- The existence of a corporation is no longer to exclusively generate value for its traditional stakeholders, rather it must now maximize the exchanged value throughout its entire ecosystem. It’s a bit like the number of stakeholders has suddenly expanded and is now including external actors. Even with this new twist, it should be noted how this exchange is intended to amplify, within a network perspective and thanks to the ecosystem, also the value generated for the traditional group of stakeholders.The Social Business is thus an organizational construct aimed to make the company more efficient under mutated market dynamics and consumer behaviors.
In a nutshell, a Social Business is like an organism that adapts to its environment and is thus able to consciously and frequently re-calibrate itself and the experience provided to its constituents based on intercepted stimuli:
Why is Social Business so relevant to my company?
In the last few years, an extensive set of studies have shown how Social Business can accelerate organizational efficiency and increase the potential of your business in a number of areas. For example:
Inside your organization:
- Improved business performance (profit, productivity, margins, etc)
- Increased operational efficiency
- stronger outcomes from knowledge intensive work
- Capturing and retaining institutional knowledge
- Better awareness about business opportunities and colleagues needing help
- Richer cross-department contamination and collaboration
- Reduced email traffic and information overload
- Cheaper and quicker mechanisms to connect colleagues, find and reuse knowledge
- Improved cross-departmental communication
- Reduced travel expenses
- Facilitating the emergence of collective social capital and limiting duplication of effort
- Stronger employee engagement and motivation
- Increased satisfaction of partners and suppliers
- Reduced supply chain costs
- Lower on-boarding, training and talent retention costs
- New levels of business agility and reactivity
- Improved internal processes through customer insights
Outside your organization:
- Reduced customer care costs
- Improved client satisfaction and loyalty
- Increased number of leads generated and deal closed
- Shorter sell cycles
- Lower marketing costs
- Amplify qualified brand reputation and visibility through advocates
- Higher sales and conversion rates through ambassadors and online communities
- Reduced customer churn and deflection
- Increased customer lifetime value
- Attract better talents
- Improved customer cross-channels
Across the organization:
- Improved product development processes and reduced time to market
- Smaller product development costs
- Access to an unlimited source of ideas and feedbacks for product improvement
- Better risk mitigation and increased number of successful ideas when launching a new product
- Easier development of new business models
What does it take to become a Social Business?
There is no social business if the organization is not able to:
- Serve the individual. Consider individuals (inside and outside the company) at the same level as traditional stakeholders.
- Listen. The company break down silos and boundaries to constantly intercept signals coming from the people (inside and outside it).
- Respond. The company engages all the constituents to produce an effective, reactive, coordinated, transparent, appropriate response to the stimuli received, regardless of the channel of origin.
- Learn and evolve. The company extracts meaning from the captured signals (coming both from inside and outside) in order to continuously improve the working mechanisms and thereby maximizing the benefits for all parties involved
- Become social. All the processes are dynamically and organically optimized based on collected feedbacks and in line with the experience of all the individuals in the ecosystem.
While at early stages of approaching social media and social media analytics, most organizations simply juxtapose such insights as another part of the mix of their traditional enterprise . . On the other hand, a mature social business goes well beyond simply reacting to online conversations as it converts all the signals (from employees, customers and partners) into actionable insights, i.e operational guidelines for a continuous culture and process improvement:
Where is my company along the Social Business Journey?
As companies begin to vest their interest, or even launch initiatives to involve their customers and employees to improve their business, a possible sequence of cultural, technological, organizational maturity stages emerges. Each stage is characterized by a certain level of understanding of the role that social media plays in creating value, by different organizational schemes and by specific degrees of integration between internal systems and online conversations.
The evolution from one stage to the next often requires a major mind shift from one or more stakeholders. These vary by the industry sector, the propensity to change, and the results of people-affecting initiatives (eg knowledge management, customer relationship management, etc.) that run in the past.
To understand the position of your company and to identigy the steps towards developing your strategy towards Social Business, consider the following path: