HR: The unwanted link in Social Business

Pubblicato da Emanuele Quintarelli | in Enterprise 2.0

Lee Bryant today relaunched a short but thought-provoking piece  by Niall Cook that inspired this post. It’s titled HR: The missing link in social business. It definitely deserves a quick read so If you don’t want to have it spoiled, please stop here and pay Niall’s blog a visit.

For those of you without much time I’ll quote the conclusion below:

The fact is that every successful use of enterprise social networking I have seen has recognised that people are what makes it work … It is my view that HR should own this part of the process.

… sustained and consistent internal and external use of social technologies requires good internal communication, change management and training, often all things that fall under the HR umbrella.

In short, HR represents the voice of the employee when it comes to corporate social networking, in the same way that marketing represents the voice of the customer when it comes to social media.

And that’s why I believe HR has a key role to play in understanding and applying social technologies to support and change organisational culture.

Let me split this in two.

I’ve spent the last seven years repeating how the Social Enterprise is about people and change. Change applied to processes, personal culture, organizational behaviors and targeted engagement of employees on meaningful business problems. Well beyond the hype still on the market, these few points makes all the difference in the world in terms of:

• A totally different kind of project centered on co-design, bottom-up participation, iterative refinement, inclusion of specific professional needs
• An enlarged cross-departmental buy-in of the major internal functions (including HR, IT, Internal Communication, R&D, Lines of Business)
• An impact on business processes through collaboration based exception handling
• Appropriate KPIs and metrics rewarding knowledge sharing, openness and transparency
• Brand new and currently rare competencies mixing organization, business, economics, change management expertise
• Governance dynamics, mechanisms and organisms equipped to support and scale internal communities

Is all this critical? Yes. Is it new in organizational terms? Yes again. Is it HR’s reserved ground? Unfortunately I don’t think so.

This is simply not happening in quite all the companies I’ve worked with and I’m not sure why. It could be for the transactional focus rooted in the 19th century most HR managers and HR processes still have. It could be because they feel treated by a limitless freedom and transparency. It could be because most HR managers are not that used to social media and cannot easily figure out how to apply them in an enterprise context.

Even if HR should clearly be a key actor and enabler in Social Business, it hasn’t ever been until now. Some numbers could be more credible than my own limited perception.

According to the MIT the areas driving Social Business projects are below:

Not surprisingly HR comes after any other “meaningful” department with the only exception of Operations. And what about the most active functions? Here’s the picture McKinsey published recently:

Do you see HR somewhere? Exactly my point.

Conclusions

All those involved with collaborative projects understand the fundamental role HR should have in nurturing bottom-up participation, new management models and a culture of openness… But is this ever going to happen? Human Resources are already a co-stakeholder in the most mature initiatives but rarely the owner or the main driver.

Is it HR a missing or a unwanted link in Social Busienss? I’d like to hear the voice of HR managers.

The slow transformation towards the digital workplace

Pubblicato da Emanuele Quintarelli | in Enterprise 2.0

It is well known that although Social Business could theoretically unlock a very significant economical impact, realizing this value requires a not linear, not painless process of transformation which, nevertheless, is quickly becoming crucial for the survival of more and more organizations.

Faced with the slow pace of change, it seems pundits are swinging between two equally incorrect and dangerous perceptions: seeing anything through the lens of social or considering social as a plague from which set yourself free as soon as possible and by all means available.

Having reached the peak of inflated expectations, I believe it is time instead to objectively look at the impact informal networks are having on organizations and markets, starting with the figures now profusely available for example through the study just published by Jane McConnell. Given the space constraints of the blog, I will limit myself to pointing out the most interesting Social Enterprise insights, while referring you to the Digital Workplace Trends Report 2013 for any other detail.

It turns out that even if 73% of the participants are moving towards the digital workplace and 93% of them is experiencing some form of social networking among its employees, the gap between technology deployment and effective use is steady at 40%, except for older capabilities with a smaller impact on culture:

How to fill the gap? What is the key to introducing new ways of working that represent a better fit with today’s needs and market expectations?

The 170-page report gives several ideas in this regard thanks to the distinction between the behavior of early adopters and the majority:

• The diffusion of informal networks for the benefit of employees: early adopters have introduced social networking capabilities 2 times quicker (69% vs 31%) than slower peers being 2 to 5 times more proactive also in respect to knowledge sharing and finding experts / experience, co-creation, comments and ratings, creating communities, sharing photos and videos, activity streams, internal crowdsourcing
• The management is walking the talk: in addition to being generally in favor, the senior management of the early adopters is 3 times more active as a role model and twice as an engine for the initiative
• Investments ​​on mobile already made: mobile access will be the priority in 2013 – 2014 (69%) and early adopters have already spent on it two times the investment of the majority with an eye to BYOD (bring your own device)
• Governance in place: the definition of procedures for decision making, policy and guidelines is between 5 to 18 times more advanced in early adopters despite the huge room for improvement still remaining even in the more mature companies
• The transformation business processes has begun: 22% of the early adopters claims to have many examples of how collaboration is significantly changing the way people work versus a mere 3% for all the others. 60% of respondents, however, shows the first steps in this direction.
• Measuring the return of business, not just the amount of participation: while continuing to measure the level of user activity, early adopters evaluate the business value generated by the initiative 2.5 times more than the laggards
• A culture of sharing, trust and free expression. It’s not possible to say what comes first between culture and effective collaboration, but surely the two go hand in hand with the early adopters that shows an environment with more confidence, willingness to share, ability to voice opinions, involvement of employees by the management
• Starting from the bottom and from top. Engaging the stakeholders, some benchmarking, some reports are all useful and important steps but early adopters show how collaboration requires an effort that comes both from the top and the bottom. IT is for this very reason that emphasis should be placed on the role of internal champions and the behavior of peers (bottom-up) as well as on the example provided by the leaders and internal communication campaigns (top-down). On the contrary training, physical events, including collaboration in individual goals appear at the bottom of the list together with gamification that is probably still too uncommon for getting better grades
• Community management, community management, community management. If the community manager is still rarely a new role full-time, more than 60% of early adopters has more or less an official community management support compared to 28% of the others.

Despite these promising approaches characterizing early adopters, dozens of areas are still open for improvement both for pioneers and slow movers. The most striking one are as follows:

• From deployment to adoption: even among the early adopters, only 25% of participants experience a social networking use by more than 1/4 of the workforce and only 6% by at least half of them with values that are not too far from laggards. The explosion (even 20 points in one year) in the deployment of new tools has not yet translated into satisfactory levels of adoption that remains at 20-25%. This first point should be marked in red. Involvement, adoption, change, cannot be achieved as a hand of creative painting on top of traditional deployments. On the contrary they are the core and key philosophical basis any proposed collaboration initiative should address from day 1. It’s without this that we are still seeing a loss of opportunity / value after so many years.
• There is still lots of unfulfilled potential: the level of interest remains high with about 25-30% of the companies that have not yet taken the step, but that are about to (“I’m planning or considering introduction). Let’s use this interest to change the world!
• Mobile is finally becoming an operational channel not just for accessing news, email and calendars but especially to consume business applications needed for daily work (currently limited to 20% of the companies) and by all employees (only true for 27% of respondents). Being always on the move, out from office hours and from the office, mobile is no longer optional.
• Governance has not made ​​much progress even in the early adopters. The numbers are virtually unchanged compared to 2011 with the vast majority of companies still working on this issue. Governance, rather than as an instrument of control, should be better considered as a lever to focus the action and resources (not only financial ones) needed sustain the project over time.
• Providing an integrated and consistent experience. The not so linear and hectic deployment of collaboration has surely contributed to massive fragmentation among multiple contexts, applications, access credentials both in terms of experience and multiple applications available. While having an advantage, even early adopters still have works to do in order to put real user needs at the center more than the gut feeling of those in IT department.
• Budget allocation too unbalanced. Although many understand that technology is not enough, 64% of the budget is still spent on the implementation of the platform, leaving a poor 14% for training and change. The values ​​are even more terrifying for large companies (> 80K employees) where the split is 81% vs 11%. The budget is a good indicator of the maturity of the organization and of the owner of the initiative. Without appropriate resources, companies will never achieve adoption and thus business value.
• Community management still not widespread. Specifically, the budget for cultivation is still too small with half of the participants not having any community management at all. A terrible confirmation of the findings of the past.
• The resistance comes from different places based on the maturity level. For those just getting the journey started, top management represents the biggest stumbling block (80%). For early adopters this time has passed and now it’s up to middle management that still stands as an obstacle towards change, together with operational supervisors. Given that change is made up of people and for people, It’s surely good to include transformation as a strategy from the beginning of the project.

Conclusions

Social business is substantially different from the thousands of change initiatives employees have been exposed to so far because it is the first time that it is their role to be challenged through a more weight in the future of the company.

You can’t and you shouldn’t underestimate the scope of this epochal change that deserves to be handled with patience, consistency and dynamics that don’t match with what departments such as Internal Communication, HR, IT have been used to so far. That’s also the reason for the following chart:

Although many organizations have registered some success, the overall picture is rather disappointing and suggests that 50% of them are still in the middle of the journey. A road we learned to be long and dangerous.

For those who were expecting a revolution in a few months, this may represents a delusion but nonetheless the lessons learned from the pioneers are helping everyone else to avoid potential cliffs and properly equip for the big jump.

Collaborating in Sales Force Enablement

Pubblicato da Emanuele Quintarelli | in Enterprise 2.0

In 2013 organizations will be less and less inclined to adopt collaboration as a confuse, not measurable, for its own sake initiative asking themselves instead where and how to connect it to where value gets generated: key business processes.

To many managers the only kind of understandable value is.. you guessed it right.. money and money is the realm of the Sales department. This notwithstanding sales reps haven’t recently been the central focus of conversation when it comes to collaboration, especially behind the firewall.

This lack of attention is anyway destined to vanish for a number of social, technological and market reasons:

• The customer (even the B2B one) has gained control. A more informed, more demanding, more connected and empowered social customer is requiring an higher level of quality in the interaction with the organization.
• The sales cycle has changed forever. Forums, reviews, communities and other online exchanges are seriously influencing the buying cycle at every stage by creating awareness, adding competitors to consideration, convincing stakeholders about the strengths of the product. Other customers and honest discussions are much more credible than marketing collaterals. This is especially true with complex and expensive deals where multiple internal stakeholders are in the game, decisions take months and their impact can accelerate or destroy the career of the involved managers.
• From product to service. A single standard product is no longer enough. In a globally more fluid, transparent and competitive landscapes, customers are often looking to apparently softer aspects such as support, release cycles, reputation, integration, professional services, online communities and other services that can extend the effectiveness of the investment for years. Buying an ERP is not exactly like buying an mp3 player. Sales reps are required to be more competent not just about the product but also about the market and about the customers.
• Sales no longer happen in a vacuum.  To address higher expectations, sales reps need real time help from marketing peers (competitive information, collaterals, updated documentations), R&D and product specialists (roadmaps, specific product features, ways to mitigate weaknesses, etc), customer service agents and professional services (does the customer have open tickets?, has the product brought value in the past?, have they met barriers in using it?, etc), customer intelligence (where is the market going?, what are clients expecting?) and any other employee potentially exposed to customers through the web.

In a Social Sales study, Accenture found enhancing team communications and improving access to information as the primary way to increase sales effectiveness and yet the best practice sharing across the sales force was also the area most in need of improvement. Even with 70% of respondents utilizing collaboration, knowledge circulation has seen scarce results mostly due to the remaining prevalence of outdated teamwork approches (telephone and e-mails) and “silo syndrome” preventing employees from working together across different departments:

On the contrary, the move from selling products to addressing complex customer’s issues requires non hierarchical organizational models and cross-unit collaborative behaviors:

Social improves sales force effectiveness, productivity and responsiveness at each phase of the cycle by:

• Maximizing internal lead generation and account information sharing
• Share insights between sales reps in problem solving and more accurate proposals preparation
• Enabling agile teams and scaling expertise location to increase the quality of the solutions created
• Letting sales reps systematically collect feedback from the market to influence both commercial strategy and marketing collaterals
• Keeping the sales force constantly aligned with updates from the organization about new acquisitions, new features, new campaigns
• Increasing win rates through shared customer intelligence, more visibility into the sales process, reuse of existing collaterals and a better fit with customer’s needs
• Skyrocketing the sales rep engagement by building a common sense of identity and belonging
• Streamlining communication and collaboration to spend more time with the customer
• Accelerating innovation by allowing subject matter experts to brainstorm and easily share what they know
• Extending the conversation behind corporate boundaries by including suppliers, partners and even customers

Together with other (most customer facing) CRM areas that received much more attention until now, sales force automation and enablement is getting under the spot as a short term opportunity to increase revenues. Nonetheless sales reps have always resisted efforts to push sharing knowledge on their accounts, deals, commercial strategies.

In order to be successful with collaborative sales enablement a few key points have to be kept in mind:

• Personal value should come first. Sales people are extremely competitive and focused on their budgets and relative position in the organization. Adoption here is possible only by aligning the initiative to their goals
• Formal buy-in is often required. Given their resistance to change when money is at play and the remaining importance of personal relationships with customers, social sales enablement is strongly facilitated by a significant amount of senior management proactive involvement and sponsorship
• Integration is an accelerator. Embedding collaboration into CRM records preserves context, maintain all the information in one place and limits the need of switching between different applications to get work done
• Economical incentives must be aligned. Nobody will share a single bit if this is not economically convenient. Reasoning about collaborative goals helps bringing down the silos
• Exposing lack of knowledge. Complex sells imply extensive expertise integration but sales reps don’t love letting everyone learn what they don’t know. Building trust across the sales force is a fundamental step in adopting collaboration

Even if barriers remain a number of examples show that collaborative sales enablement is not only possible but also very promising. Have you got any experience with it?

Back-forward integration between laughing and doing

Pubblicato da Emanuele Quintarelli | in Enterprise 2.0, Social Business

I’ve always been fascinated by new ideas, by exploration, by going beyond what exists to find alternative options not so much as new shining objects but as concrete opportunities for individuals and companies to thrive.

While going through my friends’ posts in Facebook, this quote from Azim Premji, one of the richest men of India, struck a chord as it happened to me more than a couple of times:

“If people are not laughing at your goals, your goals are too small”

I find it very true.

While nowadays this entire idea of people centric organizations enabled by collaborative platforms is well-known among many web inhabitants and managers, this wasn’t the case at the end of 2006 when the journey started for me. Such as in any meaningful transformation trajectory, changing the way enterprises functioned by putting employees, customers and partners at the center looked dramatically utopic with the the very first years much more similar to a nightmare than to a linear, even if slow, adoption process. Thanks to the initial successes, accumulated case studies, improved change management methodologies, more capable social software platforms and the tireless job of practitioners, some of the initial laughs have left space to the thousands of projects inside organizations.

Fast forward to 2012, many of us expected those days to be gone forever thanks to an interrupted learning curve from Social Business infancy to business relevancy. And yet, after 6 years of social media experimentation, we are at it again at two different levels:

• A bridge into the future. Enterprises are still laughing at social meant as a sterile approach mostly disconnected from the peculiar mechanisms of every industry / business context and not able to produce replicable quantitative benefits. This is not the economic climate for wasting time or money
• A bridge into the system. It may sound absurd but most of the organizations still don’t have the cultural tools to understand social and won’t ever get it without an enormous effort in building the basic bricks needed to breath how much our world has changed and why this is meaningful to them. When you are not equipped to understand something, it quickly goes into the not so relevant-crappy-stuff basket.

As there is so much to do to fix the situation, I’ve started to call this process back-forward integration. Actually it is not very different from a tree that, in order to live, has to symmetrically develop in two directions: its leaves and its roots. One mirrors the other and for the formers to grow up high the others have to get deep into the ground.

While clearly at the forefront of Social Business adoption, back-forward integration poses two serious challenges to the pioneers of this space:

• Integrating with the business. To be ingrained into the system we have to intimately understand its internal workings. This means a first hand experience of the specific issues affecting every single industry, region and potentially customer. An industry focus is inevitable for reaching social business maturity.
• Integrating with the culture. A door is needed to penetrate into the system. With Social Business this passage is quite always connected to the cultural, management, leadership barriers contemporary organizations face when opening up the doors to horizontal participation. This kind of integration requires a common language, common constructs and some shared experience of what is happening outside of the enterprise. A good dose of openness and patience are also welcome.

Without deep roots and extensive leaves, no tree can survive storms, winds and floodings. Without understanding the business and being understood by the current culture, no social business can help the organization.

In this second inning of digital transformation, enterprise are laughing not because they don’t believe this is the future but because they expect much more from it: more value, more replicability, more measurability, more integration at a fraction of the cost. Unprecedented hybrid capabilities at the intersection of technology, business, change management, communication are at play to meet such expectations. Packaging them together will soon differentiate those that add value from those left behind.

If executives are laughing again at Social Business, it may be because our goal is to transform the very world they have learnt to call home.

What do you think? Are you equipped for this?

How does social meet processes?

Pubblicato da Emanuele Quintarelli | in Enterprise 2.0

Communities of pratice, intranets and team collaboration are not the only scenarios through which social media are percolating inside the enterprise.

More recently a number of pundits have suggested an additional and quite diverse opportunity for injecting peer-to-peer interactions inside work practices by marrying traditional business processes and collaboration. One year ago, Ray Wang and its Constellation Research Group summed up the key targets of this transformation mentioning areas such as Customer Service and Sales, HCM, Marketing and PR, Project Management through 43 use cases.

Social and processes come together following different levels of maturity to introduce a number of benefts:

• Exception handling as an efficiency lever: according to Forrester, 50% circa of employees consider existing processes too rigid to facilitate adoption and effectively allowing them to reach process goals. Rigid, a-priori designed processes break down in front of an increasing uncertainty, volatility, competition and power consumers get thanks to social media. That’s where being reactive quickly, constantly learning, anticipating issues when they present and improvising becomes important as processes (have a look at From Push to Pull).
• Social in the flow: switching between tens of not integrated enterprise applications and adding load to existing responsibilities is not something employees are looking for. Deploying social media in the flow of current work practices is thus a clear adoption pattern project and community manager shouldn’t forget
• Improving knowledge work. According to McKinsey 20% to 50% of knowledge work is inefficient or totally wasted while knowledge workers are the quickest growing and most expensive part of our workforce. An opportunity of making them 20%-25% more productive is at hand. The value locked in internal collaboration is two times bigger than in customer facing engagement.
• Building the agile enterprise: empowering rank and file by pushing decisional power lower in the hierarchy at the very point where issues arise it’s the possibility for the organization to become more agile and reactive to change. Adding collaboration on top or inside processes gives employees the right to accomodate customer’s requests, to fix inefficiencies, to circulate and aggregate all the knowledge available while minimizing barriers to change management.
• More easily measuring returns: identifying a ROI from collaboration is probably the first question most managers have when looking at Social Business. Starting from an existing process and its baseline is a great way for seriously evaluating the improvement participative work provides.

How much is this really happening? AIIM brings some data through a new report titled Social in the flow. Transforming processes and sharing knowledge:

• Integration is important: At least 50% of organizations feel that integrating social to all types of business process would be very or extremely valuable:

• Some processes have priority. Customer support, marketing, collaborative content creation and reuse processes lead the pack while project coordination, knowledge sharing and internal communication, problem solving and expertise location follows immediately after. All of these processes are good candidates for socialization in the next 12 months at well over 50%:

• Integration is yet at the beginning but it’s happening. 64% of organizations are using social without any integration to their business processes while 21% are taking the first steps:

Conclusions

By enabling the benefits cited at the beginning of this post, socialization of business processes will probably be the most critical area of focus for organizations willing to reap the largest results from collaboration. CMOs, CIOs, CEOs, line of business and other senior managers are actively promoting it.

It won’t be an easy journey though. Our organizations are not designed to be connected across boundaries and silos. Localized project-based or departmental implementations will keep surviving. Executives in HR, Finance, Compliance are still refusing to adapt. Both security issues and lack of understanding are still mining the diffusion of Social Business. Only 9% of the participants expect full integration to happen in the next 2 years.

Nonetheless in a time of economic crisis becoming more relevant both to the business and to employees it’s the only direction where collaboration could be heading. Other than providing measurable benefits, a more structured approach to peer-to-peer participation brings with it a long list of positive side effects such as a more mature approach to social by:

• Explicitly defining how it is meaningful to business
• Giving an active role to those (because a single department is not enough) responsible for the transformation
• Evaluating where collaboration has to mingle with enterprise infrastructure
• Building a shared strategy of why, how and to what final form the organization will transition

Is your organization already on its way? Do you see this journey as useful from a business perspective or not?

Ad Maiora

Pubblicato da Emanuele Quintarelli | in Enterprise 2.0

Facebook is (almost) dead. Social media marketing is dead. Social CRM is dead. Social Business has failed.

All of this while half of the organizations never heard about Enterprise 2.0 / Social CRM / Social Business and the other half is still wondering how to realize any business gain from it:

• Enterprise 2.0 failed to meet expectations. Altimeter recently discovered that the impact ESNs have on the organization is stil limited (between 1.63 and 2.91 on a scale from 1 to 4), 2/3 of budgets don’t exceed $100K, 61% of organizations have not reached maturity and 69% are not good at measuring results
• Social CRM is missing the point. According to Awareness, only 16% of respondents are currently using Social CRM, less than 20% of the companies are handling at least 1/4 of customer service issues on social media and listening to IBM there is an immense perception gap between what customers want and what brands think they want
• Social Media Marketing is going nowhere. Again from Awareness, the majority is not measuring social media initiatives (53%), measuring ROI is challenge number one (57%), increasing the number of fans (66%) and the amount of content posted (56%) is where money is spent
• Social Business remains just an idea. How many efforts do know of able to strategically integrate internal and external communities while fundamentally transforming the DNA of the organization? Yep, I guessed so. Want another proof? Even in front of a $1300B potential, McKinsey says that no more than the 3% already achieved substantial benefits across all the stakeholders (employees, customers, partners) and according to MIT / Deloitte only 18% considers Social Business important for the organization.

Can’t you see anything wrong with the statements above? Is the wheel spinning too fast or are we looking at it with broken lens?

The fascinating thing is that we moved to the Through of Disillusionment without ever fully experiencing the Peak of Inflated Expectations given that most executives have yet to understand the meaning of this social revolution while pundits are ringing the bell of a next new thing.

As Sameer Patel said, the first inning of Social is over. To me it’s clear why:

• Social has never been meaningful. Preaching collaboration, fraternizing through online communities, sharing horizontally and without a purpose is not the priority of any executive. There is no ROI until we make the case of how collaboration can improve what organizations are already designed to do. A case made in business language not community manager’s one.
• Social has never been connected to business processes. No context, no adoption and measurability, no value
• Social has never been embedded into the flow. Adding wikis and blogs on top of what people do means wasting time and money in an already gloomy economic climate. Until social won’t just become plain business, employees won’t flock to social.
• Social is but a piece. Quite always a minor one. Customers are already expecting a consistent, integrated, exceptional cross-channel online and offline experience. Social is adding further complexity and fragmentation
• Organizations are not compatible with social. Command & control, competitive culture, lack of transparency, risk aversion, no meritocracy are the end of any collaborative effort. If you cannot address culture, no cannot deliver value
• Social is a mean, not an end. Social whatever is not and won’t ever be a goal in itself. Organizations won’t be interested in social until we can prove how social will fit into their priorities. I have never seen this step accomplished.
• Social is meant for scalable learning not scalable interaction. There’s nothing you can learn by limiting yourself at handling every customer interaction separately. On the contrary an exponential amount of interactions means an immense opportunity to constantly refine your products, services and internal processes at scale
• Existing actors are not equipped for transforming organizations. Agencies only get campaigns. Software vendors only get licenses. Most consulting companies only get top-down deployments. Smaller actors are not able to scale. What we need instead is winning soul and mind of employees, customers and partners at the enterprise level. It is a new transformational battle aimed not only to improve the business but also the lives of those inside it. You cannot engage people without empowering them and making them the owners of the game. You cannot engage the business without speaking its language.

Is this the end of social? Nope. Social is a paradigm shift and any meaningful change takes time. Consolidation is finally here to wash away the hype of the first inning. Execution, scalability, integration, business value will take its place becoming the new norm.

We can call it Social Media Marketing, Social CRM, Enterprise 2.0 or Social Business. Nonetheless we’ll be still missing the point until the broader picture will come together by connecting social to the digital landscape and embedding digital into the real business realm.

After 5 years, November 23th will be my last day in Open Knowledge. It’s to bring this vision to reality that I’ll start a new adventure.

Stay tuned!

15 Stories to Show the Value of Social CRM

Pubblicato da Emanuele Quintarelli | in Social Business, Social CRM

Yeah, we are at it again. The never stopping, never solved, everyday hotter question of if and how social business (or social media, or social whatever you want) can bring measurable business value.

While many believe this is the case (see among the others $1B+ analysis from McKinsey or the 101 ROI examples from Peter Kim), as a matter of fact some are trying to prove it. Even if the following are not exactly examples of ROI but more leading indicators of the returns, the success stories Lithium put together are nonetheless telling. I won’t get into the details for each case, but I believe that grouping them in a few buckets could provide some insight on what the market has achieved until now.

Scaling customer service and customer loyalty 

Best Buy peer-to-peer support community includes customers, Blueshirts, Geek Squad Agents to generate value in call deflection and sales advocacy. If you need an answer you go to the community, pose the question, engage in conversations with other members, rate and approve solutions. Twitter, Facebook, videos and blogs have been added to provide more information and more channels where to interact. Social channels are integrated and handled by Best Buy community teams directly from the community. Answers seamlessly become part of the knowledge base. An idea management area has been added to the project. 95% of conversations are generated bottom-up by the users (and not by the company) with savings in the range of $5M and contacts with 600K customers each quarter. The full story can be read here.

Superfans can help quite a bit with building a bottom-up customer service, especially when mixed with company’s ambassadors. Take the HP example where ambassadors (100 of them) contributed 5% of the posts and 10% of the solutions while only 50 superfans provided 52% of the accepted solutions. Here no business results have been formally measured but the community serves 30M customers, 7 languages and 200 countries addressing 20% of the requests globally.

Superusers are key also for Movistar, where the community grand master has 5K posts with over 56.5K minutes spent online. In this case the value to the company has been calculated as a significant $5.75M / year in call deflection.

Autodesk scored even better integrating social support to CRM for case management / escalation and saving $6.8M after the first 12 months with 53% of its subscription customers solving their issues directly online with a 26% deflection rate.

Others?

• AT&T got a 16% improvement in call deflection and solved 21K customer stories
• Lenovo is helping its customers 24/7 thanks to 30 superfans that contributed 44% of the solutions and 1200 articles in the knowledge base
• Tomtom capped support costs by handling 20K cases online in 1 month with $150K in savings
• Linksys (Cisco) substituted its support community to its call center during during an earthquake. Now it has taken the place of email (discontinued!), serving 4M customers and deflecting 120K calls each month. Linksys is also seeing decreased support costs, better product insights and increased customer engagement

Social Support communities bring tangible value in many ways:

• Reducing costs by deflecting calls through the community’s knowledge
• Providing answers dramatically quicker (in minutes instead of hours as Giffgaff is doing)
• Creating better solutions through superusers / advocates / SMEs
• Nurturing stronger peer-to-peer interactions
• Getting deeper customer insights through surveys and analytics to guide product and service improvements
• Generating new business by committing to customer success

According to Forrester, by 2014, integrating communities into customer support will realize a benefit between 10% and 50% in cost reductions only. Not bad to me.

Increasing revenues and influencing decisions by leveraging passion

Can you increase revenues without increasing your marketing budget? Yes if you are able to provide answers that nobody else gives as Redfin is doing by letting customers talk to each other transparently in a otherwise totally opaque real estate market. Thanks to the community, customers can freely discuss market trends, real estate best practices, neighborhood guidance while the company was able to grow revenues by 40% while at the same time reducing marketing spending by 82%. By going open and listening to customer conversations, Redfin also increased its NPS by 5% and influenced 51% of its customers with 22% of the buyers posing questions inside the community.

Sephora with its BeautyTalk is another brilliant example of community where women come to talk about beauty and get expert advice. More than just chatting, the community boosts spending with members having a budget that is 2.5x that of the average customer. This number reaches 10x for superfans.

The same happened for TVG, an interactive horse racing network, where the community not only connects and empowers wagers but also stimulate them to bet. 64% of community users have wager accounts, they account for 20% of the total amount wagered, spend 36% more and show higher handle growth than non members.

FICO is yet another well-known story. The community solved a key issue with providing 850K customers rich individual support on their credit score but also on how to improve it, something the company is not allowed to talk about. An additional effect has been contributing to 39% of the myFico.com traffic, increasing members spend by 66% and driving 13% of sales.

Ideas, Ideas, Ideas to improve products and services

Even if not traditionally part of Social CRM, innovation is today a key area directly impacted by social media. Other than passively mining peer-to-peer support and customer insights, ideas and feedback can be proactively stimulated as the following examples portray. Given the long-term impact on the innovation process, a clear ROI is often hard to formulate but co-created ideas show a promising potential in terms of new tariffs, additional sales, improved customer experience.

90K Verizon‘s customers have been sharing opinions on products and services for the last 3 years but in 2010 the company looked for a more engaging collaboration by introducing an idea exchange platform aimed to identify product / service enhancements, to facilitate customer-driven suggestions, to reposition the brand around innovation. Consumer generated ideas have become part of the product management process and while business results are not been measured at the moment, customers seem to like co-created innovation by posting more than 1700 ideas with a growth of 107% in comments, 403% in votes, 555% in visitors. 31 ideas have been implemented and other 250 are in progress improving customer retention, early detecting potential issues and getting closer to the market.

With LabVIEW National Instruments bring engineers and scientists at the core of the product design. Among its results the reduction in customer complaints (suggestions are systematically collected in a single place) and the increase in NI productivity while prioritizing new features. The platform is very active (2400 ideas submitted, 9740 comments, 45400 unique visitors) and its outcomes are integrated with the R&D team through tens of features implemented every year in the new version of the product.

Very similarly At O2 the community helps steer the direction by crowdsourcing ideas. The ROI has been positive since month 3 with 900 submissions in 6 months.

Conclusions

These are only a few of the 1000+  examples of large companies embedding collaboration as a mean to not just to communicate with customers but especially to get them involved deep into business processes. In many cases monetary returns have been calculated. In others, the project is yet to be connected with measurable economic gains but nonetheless both the customer and the company are enjoying a better experience, a stronger connection, an increased productivity, ultimately recognizing more value from the mutual relationship.

What these stories prove is how Social CRM and Social Business are starting to affect the bottom line with some recurring patterns:

• The company is sincerely interested in building value with the customer instead of the customer notwithstanding. Human beings are attracted by credibility, transparency, reciprocity and the freedom to exchange information with their peers and with the organization
• Passion is the engine of the community both in B2B and B2C contexts. Companies and businesses are made of people often enjoying what they do everyday and looking for solutions to do it better.
• Success requires careful planning, resources, commitment and patience. From an initial pilot, most of the protagonists of the stories have listened and learned. Case studies can go that far. Experimenting and iteratively improving is the only way for building your own solution for the specific needs of your customers
• Social Business brings advantage in any industry, regulated or not. Whether you are in telecommunications, manufacturing, services, retail, consumer goods, finance and banking, real estate, there is some good example out there that you can take as an inspiration

The Reality of Enterprise Collaboration in $1B Organizations

Pubblicato da Emanuele Quintarelli | in Enterprise 2.0

It is not often that you get the chance to go at the core of how enterprise collaboration is faring inside very large organizations to sneak peek both on the achieved results and the huge political, organizational and adoption barriers enterprise are facing on the social business journey. Well, thanks to the Social Business Council (originally launched by Susan Scrupski at the 2.0 Adoption Council) and its members now we have that opportunity.

A new report titled Engagement @ Scale in the Large Enterprise provides an up to date snapshot on the current state of social engagement with some revealing outcomes.

• Workforce Penetration is still low. A bit more than half (58.9%) of the enterprise collaboration initiatives are targeted to the entire enterprise but only a few of them (16%) actually provided access to the whole organization:
  It could be because workers in the factory doesn’t have any PC, that some countries have restrictions or that the project is still in a pilot phase, but the large majority of enterprises haven’t yet opened up the platform to most of their employees.
• IT and Corporate Communications have the ownership. OMG! Cross departmental steering committees, projects lead by business lines, shared ownership? It may be true in some cases but 74.5% of the initiatives are primarily owned by the IT and nearly 40% by the Corporate Communication department:
  While respondents could provide multiple answers, it is quite striking to see how low is the involvement of Innovation, Knowledge Management, HR, R&D in the launch and cultivation of enterprise collaboration projects. Unfortunately this data point suggests that collaboration may be still often deployed as yet another piece of technology while successful companies know very well how big the effort should be in terms of change management, business impacts, new behaviors, evolving internal processes.
• Way to go on actual engagement. To me the only indicator that matters from an adoption perspective (not from a business one) is the percentage of members with access to the platform that are effectively using it. Look at what we get here:
  There are no cases where 100% of the users.. well use it.. and if that is expected, only 9% of the surveyed companies express more than 50% of adoption. In other words, for the absolute majority of organizations (57%) active or logging in users are still below 20%. This one is really telling about the state of enterprise collaboration!
• Integrated internal / external social business anyone? Not yet.Lots of discussion (see for example the latest Magic Quadrant on the Social Software int the Workplace) about converging internal and external communities, about breaking down the silos, about involving employees to engage customers. Is this already happening?
  Nope. 96% of the participants haven’t integrated internal and external communities even if 45% are thinking about that. Surely a good message on the vision. Not a so good one on the execution.

Conclusions

I’ve personally learned a lot about the extent and the way large organizations are approaching enterprise collaboration. Some conclusions follow from the report:

• 5 years are only the beginning of change. The free comments of the report shows how many of the enterprise collaboration managers expected to reach critical mass much earlier and with less effort. I can say the same is true for most consultants and thought-leaders. The reality is that we have a long change management journey ahead before collaboration will be pervasive, strategic and connect to business processes. Between 5 to 10 years is the norm in 1B organizations.
• Success comes with distributed ownership and co-created change. Except for some rare cases, change management processes are most successful when co-created by (not with) the entire organizations. It is all about distributed buy-in but and comprehensively listening to the work-related needs of your colleagues. How to do that? By involving them directly and by turning them in the owners of the community. Applying the right process makes the difference between successful projects and failures
• The journey hasn’t stopped. Even with the unmet expectations of shorter cycles for people adoption, most enterprises are still going on with their work because they see the value. Enterprise collaboration is the mark of an unstoppable evolution path towards social business with incredible business and people benefits.This is much more clear after 6 years of shared market experimentation
• Proved methodologies for scaling Social Business aren’t widespread. With all the marketing and push from enterprise social software vendors, client companies struggle to see the actual state of the market. This report provides a honest picture of what has worked and what it is still sto be done. Moving from pilots to enterprise-wide roll-outs surely requires better practices and more mature competencies most organizations are still missing.

A fundamental point to be considered is the kind of companies that participated to the survey.

The data Dachis analyzed comes only from 56 organizations chosen among 70 responses specifically because they have revenues over $1B. Other than the small sample, being part of the Council, these enterprises are among the most active and mature regarding Social Business. The outcomes are thus not representative of the entire market where adoption levels would probably be quite lower.

Is this a negative outcome? On the contrary, I see it more as the brink of a new age that we are just starting to breathe. Technology alone won’t bring any competitive advantage but this only means a higher entrance barrier exist in terms of culture, processes, engagement for those organizations honestly committed to put human beings at the center of their future.

Don’t give up the fight!

P.S for additional perspective on the report you can have a look at Susan’s and Dion Hinchcliffe’s posts.

The Dynamics of Social Customer Service

Pubblicato da Emanuele Quintarelli | in Social Business, Social CRM

In the process of adopting social media mostly to connect with friends and like-minded people, consumers keep leaving behind gazillions of breadcrumbs regarding their experience with brands. It could be the quality, it could be the service but the amount of conversations connected to what companies sells and do is exponentially growing imposing more attention on participative platforms for social support.

Is this happening at the same time in every industry? What kind of feedback are consumers sharing online? How are companies reacting?

A good look at what is happening comes from the Customer Service Index 2012 report by Brandwatch that analyzed 40 top brands across 7 industries (retail, telecoms, transport, financial services, logistics, technology, utilities):

• Online customer service conversation is declining in tone: if positive conversations grew 1%, negative ones increased 4% from 2011 proving that consumers are more and more seeing Twitter, Facebook and forums as spaces to voice their unmet expectations
• Overall sentiment has been found negative: only 3 brands (John Lewis, Waitrose, B&Q) out of 40 scored positively. Even the winners in other industries got a disappointing negative score
• Some industries are affected by negative customer service feedback much more than others: 3 of the worst performers (Vodafone, Virgin Media, TalkTalk) are Telecom providers. Overall negative sentiment is achieved also by utilities and technology providers while the retail sector leads the pack as a top performer:

• Social media channels attract discontent more than praise. Customer service posts can be categorized in direct assistance request (17%), general discontent (39%), general praise (19%), possible assistance request (5%) with levels for each category varying for each industry

• Resources should be carefully utilized. Leading brands tend to focus on a specific channel (Twitter, Facebook or forums)
• Some lessons stand out: the best scoring brand (John Lewis) excelled in the post frequency (5 times a day), speed of response (bit more than 3 hrs on average), sentiment (64% positive, 8% negative), personalizing answers and appearing empathetic

What should we learn from this? Even if the study includes a limited number of brands in the UK, there is quite a bit customer service organizations can derive from it:

• Social customer service is an opportunity and a need. There is still lots to do when we talk customer experiences. Improving customer service is definitely a clear opportunity in many industries and an inevitable need in some. Your customers are there, whether you are participating or not. You can avoid to listen but it will only get worse
• Some industries are more exposed to customer compliants. It could be the frequency of interactions or the importance they have in customers’ life but each product and service is associated to different service needs. It’s company’s responsibility to understand how this all play out for the customer. Together with your business goals, this is the starting point of any customer experience strategy
• Focus your energy. By understanding the categories of customer service conversations, it is possible to focus always limited resources on the most effective channels and most critical discussions. Social support workflows and escalation procedures will have to address this based on a cross-departmental strategy
• Balance the effort. Customers know very well the kind speed, tone, proactiveness they expect in customer service. Companies should carefully evaluate how to balance effort, cost and impact
• The right end goal. Having an overall positive sentiment may not be the goal of the game after all. Improving the extent to which you understand your customers and improving your product / service based on their feedback surely is.

What are you doing to turn negative customer feedback into a revenue generation and loyalty opportunity?

What will drive Customer Experience?

Pubblicato da Emanuele Quintarelli | in Customer Experience, Enterprise 2.0

I’ve written quite a bit about customer experience and its central role in a broader customer-centric realignment of modern enterprises. Customer experience is surely a hot topic nowadays both among vendors and consulting companies that consider it one of the last few levers of competitive differentiation.

Customer service, marketing, sales, insights together with their social extensions are clearly affecting the overall customer experience. Even more a focus on providing an excellent customer experience is pushing more and more a convergence, a fusion of customer facing functions. If this holds true and keeping in mind how siloed current organizations are, it is instead a bit less easy to answer to the following questions:

• Who should be in charge of the entire customer experience
• What corporate functions should report into customer experience and how?
• Which other functions should be indirectly impacted by the overall customer experience strategy without formally reporting under it? How?
• What’s the most effective way to rethink and redesign the end-to-end customer experience?
• Is this a once for all task or more of a never-ending ongoing process?

Forrester started publishing a rather comprehensive The Experience-Driven Organization Playbook series with a number of tools for defining, designing, evaluating customer experience with a piece specifically devoted to the emerging role of the Chief Customer Officer based on 165 interviews with CCO in the B2B and B2C sectors.

A few general details about this new role first:

• Yes it is new. 50% of them have spent less than 2 years in the position
• It is a senior position. 1/3 previously covered president or general manager positions. Near the same number is coming from Marketing or from Operations
• They have power. More than 50% of them sit on the executive management team

What is most interesting to me though is at which level Customer Experience is positioned in the organization and the kind of levers Chief Customer Officers have to influence it. Forrester here suggests 3 alternative models mostly based on the maturity of the company’s culture regarding customer experience and change management initiatives:

The 3 structures mean different roles for the CCO, together with different kinds of authority, activities, teams, budgets, strengths and challenges:

• Advisory: the COO is the head of an internal consulting unit, a center of excellence that leverage his own personal reputation and top-down mandate to advice other units while starting to understand what being customer-centric could mean. Budgets are small. The team is small and the short term goal is putting together pilots, business cases and best practices that will help the organization build new core capabilities and momentum for customer centricity. The maturity is low while the risk of the initiative to be perceived only as a nice to have is quite high. Examples are KeyBank and OpenText
• Matrixed: the CCO is a leader with dotted line responsibility over cross-department steering committee, enterprise-wide customer metrics, outbound communications and project planning. Both the budget and the resources still resides in other units that should be culturally ready to invest in customer centricity. The mission of the CCO is putting together a customer experience strategy and mandating accountability for its implementation by business units. Works fine where consensus is more effective than top-down authority. The CX team must keep up with the often growing level of support the departments ask for. Accounting firm Crowe Horwath is an example.
• Operational: the CCO formally control a new restructured organization a number of customer facing departments report into. The focus goes to customer needs more than product lines. Both the budget and the number of resources becomes huge in order to quickly implement radical changes. The organization is transitioning from a product to a service focus. Shared governance is used to influence units not reporting under the CCO. Metrics, processes and incentives are redesigned around the customer while departmental silos starts to blur. USAA is an example

Where is the problem and what does it mean for Social Business?

I’m just starting to reflect about this and please take my words simply as draft ideas shared to stimulate discussion but I still believe Customer experience will have a huge influence on Social Business and viceversa:

• Customer experience and Social. While social channels are rapidly gaining importance both in interacting with customers and in motivating employees to go the proverbial extra mile, at this point in time most channels are not social. The goal cannot end up doing social. The goal should be improving at the same time at all the customer touchpoints and understanding the role social channels will play in it.
• Is then Social Business going to mingle into Customer Experience (or the other way round)? Absolutely not. Social Business and its ability to motivate employees, engage customers / partners and bring all of them together will quickly become a key enabler of a super customer experience by allowing organizations to understand (customer insights), design (employee-customers co-creation), grow (WOM and customer engagement) and refine (crowdsourcing and idea management) what the enterprise is selling. It doesn’t matter if this means products, services, experiences or a combination of them
• Social Business will evolve by more fully embedding research, practices and tools taken from the Customer Experience world. Service design, customer journey and other central constructs already used by professionals that research customer needs, expectations, behaviors will turn upside-down the usual approach to employee collaboration. Still largely disconnected from customer experiences, employee empowerment has extensive influences on it. If “The purpose of a business is to create a customer (P.Drucker)” employees should be focused on that and should be able to see in real-time how their job affects customer facing actions. In the other direction, only understand why, where, when and how the customer hires the organization to get a job done is it possible to tie internal collaboration projects to desirable business outcomes.
• Is having a Chief Customer Officer enough? I think the Chief Customer Officer should influence this change at least for the customer facing part but in a very large acception of the concept. Supply chain is influencing the experience. Retailers or sales people are influencing the experience as well. The CCO won’t probably ever lead those departments. He can surely influence them through dotted lines, steering committees or grand plans but it won’t be enough.

Moving from a goods-dominant logic to a service-dominant logic and including every single individual of the enterprise ecosystem in co-creating vale and benefitting from value in use can only be the mandate of the entire organization. It should inform the vision and permeate every tactical interaction. It should be supported by clear strategy, a well-thought-out system of values and a maniac attention to experience.

Social is a growing part of that experience but, even more, most of the way of co-designing it.