David Christopher« Is reducing costs the key driver for social media? »
Having a social platform to allow employees to connect and collaborate better will improve the knowledge flows of an organisation. It will allow companies to utilise the collective intelligence of its own employees to crowdsource and solve key business issues.
But in the current economic climate, companies are starting to think more about how to reduce costs. Is social media the answer? Kathi Browne of Wingspouse Publishing raises a good point on the subject:
"Interestingly, it is usually cost that is holding companies back. They see a potential cost to the man hours needed to learn / participate in social media and don't have a clear way to measure the return."
And maybe this is the problem. Companies are too focused on how to measure the ROI of social media and forget that actually this is just a natural form of business evolution. With over 500 million users of Facebook and 100 million users on LinkedIn, it's a fair bet to say that many of your employees are already using social media as part of their everyday lives. So surely it stands to reason that this will become embedded as part of how we communicate and collaborate in business? Kees Vogelsang agrees:
"Given the fact that more and more people are using many tools already for personal usage it is becoming easier to implement social media. And ... there is no way back. Ultimately these tools will be embraced everywhere, just like mobile phones."
So for those companies that are making the transition and investing in social media, if costs are not the key driver then what is it that is encouraging this cultural change? Andy Jankowski of Enterprise Strategies puts it simply and succinctly:
I am seeing a few companies embrace enterprise social media to reduce costs, but not as many as I would have originally thought. It seems the main driver of companies making the Enterprise Social Media investment is simply changing the way their company works (e.g., more collaborative, less siloed, etc.). These types of improvements, while valued by the c-suite, are often hard to justify with numbers. I am seeing many more contextual examples being put forth than detailed ROI studies.
And this is where companies will have the greatest success with social media. The focus shouldn't be on reducing costs per se but more on the business benefits of better collaboration. We also mustn't forget that employees are working more and more remotely these days and social media can play a vital role in keeping employees connected.
Companies do need to start looking at evolving from a knowledge management organisation to a knowledge sharing one, using social technologies as the enabler to build that social business infrastructure. However, the cultural change in this transition should not be under-estimated or ignored and needs to be incorporated as part of the transitional strategy.
So is social media in the workplace a key driver for reducing costs? It will certainly influence the reduction of costs, but it should never be the main focus for creating The Social Workplace. The main focus should be the evolution of a company to provide more and better collaboration opportunities and increase knowledge sharing.
Reader Comments (2)
There's no rule that says that enterprise use of social media can't do both - improve collaboration AND reduce costs. A lot will depend on what you're trying to measure. If you have a formal business process that is mission critical where cost -- and benefit -- are real and measurable, is there a reason why you shouldn't consider how, say, collaboration via social or mobile media contribute to the overall cost and effectiveness of that process? Also, if meetings are critical to the communication and decisionmaking processes that run your company, is there a reason why you would not want to know what impact on time and other resources more collaboration via social media might make such meetings?
Perhaps an important reason why such uses of social media are not measure more is that to do so requires a willingness to look quantitatively at processes that traditionally haven't been measured in white collar type organizations.
I discuss some of these issues in more detail here: "Defining and Measuring Enterprise Collaboration" http://www.ddmcd.com/DMEC.html
Dennis D. McDonald
Alexandria, Virginia
@Dennis You have some good solid arguments here - I guess the feedback from some of the members above is if reducing costs is your sole objective then you are likely to fail.
Creating a socially connected enterprise has some great benefits to enhanced collaboration that will undoubtedly increase the ROI but enterprises are still very reluctant to measure this. I'll pop over to your blog post and have a read more on your thoughts and interpretations on defining and measuring collaboration.