The Answer is A Social Business Strategy

If this were Jeopardy, than the question to the headline would be, "How can I move from marketing experiments in social media to reaping measurable business value?" We used to say that a strategic approach or, most often, a strategic, integrated approach to social media will help companies evolve from tactical, platform-centric use of social media technologies. That remains true enough. But if you want to leapfrog forward, I am convinced that a leadership view of how social media can deliver value across the enterprise is the way to go. 

This week, I will miss speaking on a panel at Blog World NYC with Ben Edwards, VP, Digital Strategy & Development for IBM. I know Ben's POV on social business and it is where I would suggest most enterprise ought to head (you can see how IBM is making more out of social business here). His discussion with my colleague Virginia Miracle from Ogilvy and Peter Kim from the Dachis Group will focus on what it means to have a social business strategy (vs. a social media strategy).

Social Media vs. Social Business

When we talk about using social media in business, 9 times out of 10 we are talking about some form of marketing or communications. So much has been written about the distinctive qualities of using Facebook, Twitter, Bloggers to communicate with customers and influencers. The most obvious impact on how social media technologies and the behaviors they spark impact business is how we sell products and services to our customers or build customer relationships. Even the break out social care examples - Comcast Cares, Twelpforce and AskAmex - are as much care-as-marketing examples as anything. 

Social Business is broader.

• Employees can build relationships with customers online (good) or they can leak insider information (bad). 
• Product developers can try new products out on fans and fail faster. 
• Social networks like LInked IN and even Empire Avenue can drive new HR strategies while at the same time screening candidates Facebook pages has ethical if not legal implications. 

But back to social media marketing and communications. Even if you come at social media from a purely marcom perspective, you will quickly unlock a Pandora's box of related issues:

• what do you do about employees tweeting and Facebook posting in support of a new marketing campaign? Are they informed about disclosure guidelines? Do they even have access to Facebook at work? 
• You have finally gotten a  pretty good listening program in place. You discover that customers cannot get your new performance drink in the Southeast and their tweeting fast and furious about empty store shelves (this happened). You must take that to sales and distribution or miss a golden opportunity.
• You realize that one of the best ways to get influential customers to talk about your brand means treating them like insiders. They get new flavors, new services before others. That's the social capital in the relationship. Well, clearly, that will spark feedback that should go directly to product development. 

Even the most narrowly intended marketing program springs tendrils throughout the organization. Time to just jump in and form a social business strategy proactively. You're going to have to do it sooner or later.

Inspired by Ben and Jon Iwata at IBM, here's a definition I find useful:

"Social business is the impact of new technologies and behaviors  on business outcomes, business models, and the business of management across the entire enterprise."

The Social Business Recipe

I heard this at the IBM Social Business Summit late last year. It's completely obvious when you think about it. And it drains all of the sturm and drang out of the debates on the relevance of social media by making it a simple business formula:

The business value that social media can deliver to the enterprise is born from managing the risk (e.g. lost control, employees on social nets, mistakes made) and optimizing the reward (e.g. more profitable customer relationships, operating efficiencies through new collaboration, testing product sooner).

Optimized Reward - Managed Risk = Business Value

 

It's a Leadership Issue 

The biggest challenge is that to get the best benefit for the enterprise, you need all of the various disciplines to participate. In my humble opinion, that takes strong leadership to rally CMO's, CIO's, heads of HR and, more importantly, the next tier of management within their organizations to work together.

Few organizations have that much buy-in at the top today. By 2012, that number will rise sharply. Why not surrender to the force and develop a social business strategy today. You are going to do it eventually.  

Comments

[Jaredroy]

John, great post. I'm pushing clients to think social business vs social campaigns and to stop using social as a direct marketing method.

[Michael Rubin]

Very insightful post (as always), John. From my own experience, one of the biggest obstacles to embedding Social into the enterprise has been ignorance and lack of interest. It's quite difficult to impress upon anyone outside of Marcom of the value for Social Media. HR, Legal, Compliance, IT, et al. all see it as a nuisance that they wish would just go away.

Education can only go so far -- there must be an "a ha!" moment of need. So how do you convince the other stakeholders inside a large company that it's in their best interests to support and adopt a positive Social outlook?

-- Michael E. Rubin, Social Media Strategist, Fifth Third Bank
Disclaimer: I work for Fifth Third Bank, but this opinion is my own.
http://michael-rubin.com

[Kelli Pippin]

This is a spectacular post John. At Tuck, the Center's series on "The Business of Social: Engagement, Innovation and Collaboration" ended with your visit (but included a visit by Ben - who seriously floored me with his social/biz perspective. I keep a sound bite of our interview with him on my desktop, just to charge me up when I start getting "social fatigue".) We are now creating the written overview to summarize our findings - and this "recipe" you describe is brilliant. In terms all C-levels will appreciate too. Thanks for the post.

I wrote a bit about our series on this blog: http://www.tuck.dartmouth.edu/digital/about/blog/detail/socially-corporate/

[Sherrie Bakshi]

Really great post. I like the idea of thinking about social media as a social business strategy. We advise our clients on these same things. Thank you for sharing.

[Jeremie Averous]

Hi John
I don't think moving to a social business strategy is a choice. It is a must in the world as it is changing now with the Fourth Revolution. There is still a lot of resistance in organizations from bureaucracy. But let's face it: if your company does not become open to social interaction, it will die eventually. Be one of the firsts to get there, experiment, get experience, and outgrow your shy competitors!

[Grantspanier]

Awesome article, really insightful. Thanks to Jared for sharing this one!

[PropagandaHouse]

Nice post John, some great insights there. It's all about mindset isn't it; if businesses shift their thinking from how do we get more money from the customer to how can we help them more, the first part will take care of itself.