Market Research and Insight

How is a social business a better business? How is a social business a better business?
We’ve all heard the stats about the explosion of social media users. One-billion-plus on Facebook. One hundred seventy-five million Tweets a day. An expected... How is a social business a better business?

We’ve all heard the stats about the explosion of social media users. One-billion-plus on Facebook. One hundred seventy-five million Tweets a day. An expected 5 billion professional searches on LinkedIn in 2012.

But that’s all mostly for Justin Bieber fans, politics junkies, people who like to exchange snark or professionals looking for new jobs or business contacts, right?

Wrong. Increasingly, businesses – rather than individual fans or job-hunters – arIBM Logoe finding value in social media-like applications. Done right, these so-called “enterprise social networks” can help organizations operate more efficiently, come up with better ideas faster, improve communication with customers and stakeholders and make their efforts in corporate social responsibility and sustainability more transparent. They can provide an especially powerful edge for small- and medium-sized companies that don’t have the global enterprise advantages of large, complex IT infrastructures.

“Social media success is no longer a defined by how well your company communicates its message to the external world,” states the Taiga Company in its “Guide to Green Business: Social Media Success.” “It is rapidly becoming a critical business sustainability skill and a business sustainability catalyst that is affecting the bottom line.”

Besides, if you haven’t noticed yet, your employees and customers are already viewing you through a social network lens, even if your company itself hasn’t taken the leap. Workers are increasingly bypassing “official” IT by using their smartphones and tablets on the job. Customers, partners and suppliers are sharing information about you online whether you know it or not.

“The new normal is that customers are leading the conversations that define your brand, competitors are crowd-sourcing ideas to bring new offerings to market and employees are using social media in all facets of their lives, including work,” IBM notes in a datasheet on “Becoming a Social Business.”

For companies that want to become a part of these conversations, the most important thing to keep in mind is that foundation of social business rests on people, not IT.

“Most companies approach enterprise social networks as a technology deployment and fail to understand that the new relationships created by enterprise social networks are the source for value creation,” states a report from the Altimeter Group, “Making the Business Case for Enterprise Social Networks.” “Yesteryear, internal technology departments could force software on business units, but in today’s consumerized world, business units can adopt enterprise software, often without IT ever knowing.”

Enterprise social networks, though, “are not simply Facebook behind a firewall,” the report continues. Unlike Facebook, enterprise social networks – which can include cloud-based options like Google+ or’s Chatter, platforms built using Drupal or collaborative software like IBM’s Connections – profile employees’ work-related skills and projects, have activity streams for things like business documents and client accounts, and can be divided into smaller groups where users share relevant information just with one another rather than with everyone in the company.

So what real benefits can an enterprise social network deliver?

By making it easier for employees across three states to share ideas and keep up to date, Russell’s Convenience – a high-end food supplier to office buildings – was able to reduce its travel expenses by 33 percent and cut its postage costs in half. George P. Johnson, the Japanese branch of an events marketing agency, found its enterprise social network not only boosted productivity, but enabled employee teams to continue working and communicating from home in the days following the devastating 2011 Tohoku earthquake.

In the near future, enterprise social networks might be able to help businesses get even smarter. One IBM research initiative, for example, has developed a way to apply analytics to questions asked by network-connected employees … and route their inquiries to the best-qualified person in the company to answer those questions.

As an IBM whitepaper points out, “(T)he emergence of social analytics means not only are individual people intelligent, but networks of people have become intelligent as well and are able to learn from interactions and associations to deliver recommendations and take action.”

This post was written as part of the IBM for Midsize Business program, which provides midsize businesses with the tools, expertise and solutions they need to become engines of a smarter planet. I’ve been compensated to contribute to this program, but the opinions expressed in this post are my own and don’t necessarily represent IBM’s positions, strategies or opinions.

Dan Ilett