Herding Cats and Other New Norms

If you are a 21^st century-born organizations, you probably don’t need a social media strategy.  Social media is an integral element of your overall strategy; the two do not have separate lives.

But what about more mature organizations?  A non-profit celebrating its 125^th anniversary this year; a 75-year old global manufacturer; a 110-year old financial services institution with hundreds of billions in assets and ranked among the safest in the world?  What does a social media strategy mean to these organizations?  Why – and how – should they change a successful business model?

Social media is not a discontinuous technology change that demands attention and threatens the “old way” with a single blow.  It’s hard to define.  (Use the words “social media,” and many companies think only Facebook and Twitter.)  It is amorphous.  More than anything, social media reflects social change, not technology change. 

Over time, successful businesses do need to adapt to social change – in the way they operate both internally and externally.   Social media and social networking have evolved to the point that they are changing people’s expectations about how to interact -  person-to-person,  individual-to-business, and business-to-business.  Because, to state the obvious, “businesses” are just amalgamations of people with a common objective.  Once changes in personal interactions take hold, those changes leak into business interactions.

What are the big changes requiring significant shifts in business models?

·        Knowledge is a commodity. Remember when knowledge = power?  Knowledge is not only now available, it is freely shared. 

·        The quantity of available data has exploded beyond our capacity to process it.  Data and automated analyses are like an active volcano, constantly spewing out.  The lone hero with the data who could run statistical programs has a lot of competition, competition that is trumpeting different data and different statistical programs.

·        Engagement is not just the word of the day; individuals want a say; they want to be heard; they increasingly demand to be respected and empowered.

These fundamental changes demand shifts in what is valued in the workplace and how companies function.  Continued success in this century requires that organizations evolve to new norms.

·        The visionary composer is one of the most valuable employees.  The individual who can take all of the data and analyses and create a harmonious future vision, who understands how to integrate all of the information, is more valuable than the expert. 

·        Hierarchies are more porous; command and control is dead.  Corporate hierarchies will not disappear, but the leaders need to be the first among equals, one of the team.  Excellent corporate leaders will manage not demand.

·        The ability to herd cats, not sheep, will drive results.  Increasingly, employees want to control their own time and to have an impact.  Like cats, each wants to be recognized as an individual participating in a shared culture.

Organizations need to build these new norms into their processes.  How they recruit, train and review employees, for instance, needs to change.  The old performance metrics might no longer measure what really matters. 

What new metrics have you used to adapt to social changes?

3 Benefit Measures - The ROI of Internal Social Media Networks

The use of social media inside your organization will help to increase your bottom line.  Really.

A recent Gallup study found that firms with engaged workforces have 2.6 times the earnings per share growth rate compared to their industry counterparts.  And an Aberdeen Group study found that companies using Web 2.0 achieved an 18% boost in employee engagement.

The Gallup study also identified the danger of failing to engage employees: $300 Billion in wasted productivity.

The benefits side of the ROI of internal social media networks depends on how effectively the social media tools help drive:

·        Enhanced employee engagement

·        Streamlined operations

·        Better, faster innovation

Enhanced employee engagement has, in numerous studies, been shown to increase customer satisfaction and loyalty and to drive higher sales.  Greater employee engagement is also predictive of lower turnover, yielding significant savings in recruiting and on-boarding costs.  Employee engagement is no longer a nice-to-have; it makes hard, bottom line business sense.   (for one interesting study on these relationships, see: http://www.towersperrin.com/tp/getwebcachedoc?country=usa&webc=HRS/GBR/2008/200805/ENGAGEMENT_IMPROVES_BOTTOM_LINE.pdf)
As organizations become more comfortable with internal social media, the personal and professional lines often begin to blur, creating even greater employee engagement.  Sabre Holdings Corp, which owns Travelocity, was a pioneer in internal social media, beginning Sabre Town in 2007.  Since that time, a number of specialized groups have formed over the social media networks, including Mom2Mom.  Participants in these groups report creating strong bonds and a sense of belonging and being understood.  In a recent study, Professor Jennifer Aaker of the Stanford Graduate School of Business, Assistant Professor Cassie Mogilner of Wharton, and doctoral student Melanie Rudd noted that “although spending time with bosses and coworkers tends to be associated with some of the lowest degrees of happiness, two of the biggest predictors of people's general happiness are whether they have a 'best friend' at work and whether they like their boss. Therefore, people should try to reframe relationships and workplace goals…. Building a workforce of highly qualified, hard-working, and loyal employees is an essential aspect of staying competitive in today's global markets.” ("If Money Doesn't Make You Happy, Consider Time," Jennifer Aaker, Melanie Rudd, Cassie Mogilner, Journal of Consumer Psychology, 2011)

Streamlined operations help to cut costs, the second direct benefit of the use of internal social media.  The range of opportunities for cost cutting – while improving employee engagement! – is tremendous.  The use of discussion boards and central project sites, for example, enables executives to spot quickly time being spent on rogue efforts that don’t further corporate objectives.  Employees benefit by being able to place their projects within the big picture and make appropriate decisions.
Cisco attributes millions in savings to the use of wikis.  Geographically dispersed staff can efficiently work on single documents, share ideas and comments, and decrease development time.
Search capabilities, blogs and LinkedIn-like networks enable employees to find data quickly, identify and consult experts, and seek the advice of colleagues beyond those at the coffee pot.  Both the speed and quality of work benefit.

Better, faster innovation provides a long-term benefit.  Internal social media helps organizations expand innovation beyond the R&D walls, from the engineers to employees dealing with customers.  (How many disruptive innovations do you know that have sprung from established R&D departments?  How many corporations incent their R&D staff to spend time on them?)
Breaking down the functional silos speeds up innovation and time-to-market.  When IT, engineering, marketing, customer service, business development…can share ideas, project status, and roadblocks together across geographies in real time, problems are resolved more quickly.

52% of organizations using Web 2.0 ranked as best-in-class performers according to a study by Aberdeen Group.  Using social media internally simply makes smart business sense.

Clover Architecture – the 4 Leaves of Extraordinary Social Media

Making social media an important and seamless element of an organization is like growing clover.  You get a lot of good efforts and almost-there’s, a lot of 3-leaf clovers. But 1 out of 10,000 times, you get a 4-leaf clover.  That’s when social media transforms an ordinary organization into one that truly stands out.

The four leaves of a clover traditionally symbolize hope, faith, love and luck.  The four leaves of the internal social media clover?  They represent:

§       Leadership (hope)

§       Governance (faith)

§       Culture (love)

§       Technology (luck J)

Each of these leaves is necessary for an organization to benefit as much as possible from social media.  Drop any one leaf, and the impact becomes ordinary.

Three veins keep each leaf healthy:

Leadership – Executives must be

v   involved

v   passionate, and

v   bought-in with strong ROI.

Governance – Strong social media implementation requires that silos tumble.  

v   Governance must be cross-functional

v   Expertise must be integrated across and within units, and

v   HR policies must take social media into account.

Culture – Key cultural characteristics of break-out social media organizations include

v   openness

v   trust, and

v   collaboration.

Technology – The final leaf of every 4-leaf clover is smaller than the other three, and for social media the fourth leaf is technology.  Technology is an important enabler, but without the leadership, governance, and culture, great technology is wasted.  Many platforms can be implemented that enable engagement and dialogue.  Keep them

v   simple

v   inexpensive, and

v   designed for social interaction, not for file sharing!

I have discussed each of the 4 leaves of social media in previous posts and will continue to delve into these internal issues.  (See, for example, http://goo.gl/fb/wthL8, http://goo.gl/fb/PBENn, http://goo.gl/fb/zUijJ)

What has been most instrumental in turning your organization into a social media model inside and out?

The objective of social media is a lifestyle, not initiatives

Social media is a new way for us to get back to what matters.  It is an opportunity for companies to become amalgamations of people rather than “corporate entities.”  At its best, social media is simply a way for people to engage with one another across the expanse of a big world. 

That is why I believe that organizations cannot succeed in social media until they have built a social media culture internally.  Employees are both the first target market and the drivers of social media strategy success; they learn to share more openly, listen more carefully, and engage more fully with the entire operation.  Then they can do the same with their customers and vendors and partners.

Most organizations today believe that they “have” to be in social media.  They are partly correct.  Success demands that organizations be more social, that they manifest the underlying reason for the success of social media. 

But most organizations seem to view social media simply as a new business tool for selling, or sometimes for lower cost customer service.  The statistics are overwhelming.  eMarketer forecasts a 55% increase in ad spending on social networking sites, from almost $2B in 2010 to over $3B in 2011.  SaleSpider found that 75% of small and medium business owners they surveyed planned to increase the percentage of marketing dollars allocated to social networking in 2011.  The statistics go on and on.   It’s like the moves from print to radio to television…bigger, broader, but with little change to the underlying operations or objectives.  Those results are short-term and need continuous spiking. 

Umair Haque said it in his article in The Harvard Business Review, http://ocvets4pets.com/archive21/From_Social_Media_to_Social_Strategy_-_Umair_Haque_-_Harvard_Business_Review.pdf   It’s good to go back to the basics.

The 3 Stages to Becoming a Social Media Enabled Organization

When social media “works”, it changes how an organization is governed, how people work together, how employees approach their jobs.  How do organizations achieve the necessary change?  How do they evolve? 

Most organizations already have functioning, and often successful, business models when they begin to consider social media.  Employees have roles and responsibilities that are defined and on which they are measured.  How do “old-line” companies shift their operating style?  Creating the new environment takes time and intent.

I have found that most organizations go through 3 stages of transition, evolving from their established cultures and structures to more open, engaged, “social media” organizations over time.  Companies start with limited experiments (like single seeds in pots), expand to larger and more formalized efforts (plots with rows and cultivation plans) to engaging a whole plantation (end-to-end enterprise changes).

·        Pots – This is the first stage, when organizations test and learn, experimenting with diverse and separate initiatives.  Everything is contained in a separate pot.  Investment requirements are low.  The focus is on distinct activities – a Facebook page, a live chat on-line support function, a blog…  What seems to fit best with the organization?  What drives results? 

·        Plots – At this stage, the new activities that individually fit best begin to be accepted, and management begins to include them in broader planning.  Formalized structures and processes, along with increased investment, begin to take hold.  Culture change becomes more deliberate through new hires, employee training, and shifts in roles and responsibilities. Performance measurement begins to include “social media” factors such as buzz and the impact of ambassadors. 

·        Plantations –Social media activities and thinking are integrated into the core business and aligned with the strategy; the organization has reinvented itself without losing the essentials of its business.  Social and digital media are no longer distinct from the overall strategy.  The entire plantation has evolved to a new way of operating.

Companies can and do change.   Test and Learn.  Formalize and Change.  Integrate and Reinvent.

6 Customer Benefits of Internal Social Networks – Disarming Road Warriors

“Road warriors” usually earn that name the hard way. 

I recently had a two-leg trip, flying first to Cleveland and then to New York.   I arrived 90 minutes before my flight, to see the big red Cancelled on the board.  It was the airlines last flight to Cleveland that day.  The airline wanted me to wait until the next day to fly, but I would miss my meeting.  So I bought another ticket on a different airline and requested a refund from the original carrier; and then the fun began.

My original ticket had been purchased through a “partner” airline.  The agent at Airline One, who really was trying to help, had to call the internal Help Desk to determine how to handle my one-leg refund.  The internal Help Desk was flooded with calls – all for the same issue.  Passenger anger visibly rose as the agents hung on hold, and the passengers could hear each in turn asking the SAME questions.   

I finally received an “authorization” for a refund, but the agent claimed the partner airline had to process it.  Partner Airline sent me back to Airline One.  And then back to Partner Airline.  I was getting lots of exercise, but not much satisfaction.

Then an agent at Partner Airline said he couldn’t process the refund, but ANOTHER agent there could.  I waited for him.  Good thing I had a long wait for my flight.  The agent again really was trying to be helpful, but he didn’t know how to handle the situation either.  Twice he disappeared for long periods behind a closed door to: Ask someone else? Look it up?  Call the Help Desk?

Same problem as Airline One.  Too much time holding for the Help Desk.  Agents were calling for each passenger (and the line was growing!).  I finally got my refund, and heard the agent tell the next person that they couldn’t process the requests; she had to wait and go on-line to request the refund.  They also called Airline One and told them to stop sending passengers over; Airline One could handle it themselves. 

The agents were angry with their “partner” agents; they were tired of being yelled at by weary passengers; they couldn’t get sufficiently rapid response from their own company.  They punted.  The warriors hit the war path verbally and on-line.

Wow.  The number of loud, angry passengers was impressive.  People were still angry when the flight I had snagged finally departed 5 hours later.

A fairly simple internal social networking platform linking the agents with the Help Desk staff would have done wonders.  The benefits:

§        A one-to-many communication model   

§        Quicker access to information 

§        Faster responses to not-really-one-of-a-kind problems  (maybe someone else had already encountered the problem!) 

§        Happier passengers who screamed less

§        Agents who were less frustrated   

§        Reduction in bad WOM 

Internal touchpoints cross over to affect customers.  When employees work smoothly together, customers benefit.

The next leg of my trip…my flight was Cancelled….

Internal Social Networks: Electronic Face-2-Face

Irwin D. Simon, Chairman, President, and CEO of Hain Celestial Group, could be the poster person for social corporate culture, at least based on an interview in the NY Times, http://www.nytimes.com/2011/03/20/business/20corner.html?pagewanted=1&_r=2 .



Given his comments in the article, however, I am betting that Hain Celestial Group uses social networks very sparingly internally.  Simon commented that he is “a big communicator by telephone and by person…I’m just big into communicating face-to-face, eye-to-eye and not through e-mail…we lose a sense of communication because everything is done electronically.”

I agree that personal communication is the gold standard.  It enables leaders to share their passion, to expand their vision, to grow.  But ongoing face-2-face communication with a broad and diverse group of employees is simply not feasible in a large organization. 

Hain Celestial reported a little over 2000 employees in June 2010.  How many of those employees ever actually talk to the CEO?  Communicating one-to-one with employees might be a high priority, but it’s not the only priority.  Establishing relationships with vendors and customers are also important for the CEO.  The FY2010 Hain Celestial annual report includes as one of its risk factors its dependence on the services of the CEO, and notes that “the loss of the services of Mr. Simon could harm our business.”

Internal social networks help create organizations that are not dependent on any single individual.  The team captain will always be important; leadership counts.  But the internal structures, culture and processes should both support the leader and enable the organization to operate without him/her. 

Internal social networks enable bigger organizations to maintain the open, engaged culture that Simon describes by:

·        expanding and enhancing the conversation 

·        enabling the CEO to engage with more people

·        forging stronger team bonds across a bigger team

·        opening doors and keeping them open

It’s about acknowledging and respecting that even the CEO doesn’t have all the answers.