The social enterprise – beyond digital marketing

The social enterprise is an idea that extends beyond just using social media for marketing.

But are there any benefits to social networking?

Warren Bennis is a leading thinker around leadership in a digital world and see that organisations will increasingly use digital pathways to drive transparency and leadership. You may think that this sounds innocent – but he basically is saying that digital channels will change the structure of power in organisations and that new leaders need to look at how they use social media to lead both internally and externally in their organisation. Large companies have also seen by opening up the communication channels that leaders are being challenged to be consistent in their approach and that behaviour gets discussed in unexpected places.

Interestingly, Bennis also sees the idea of “adaptive capacity” as central to the future. The ability of an organisation to be led by what is happening in the marketplace by responding to the aggregate forces as visible in a social and digital world will increasingly become critical.

A range of leading thinkers are stating that organisations need to think of the value it is creating for its customers and in a digital world, this is becoming increasingly measurable.

So are you ready to open up the conversation and let your sales people engage in social media to source customers? You may be surprised to find that not only your marketing and sales people need access, but also your HR, finance and operations people may be using social media as critical tools in their business process. Employees are increasingly using messaging to reduce complex email communications and have interactive conversations over voice, internet messaging and private (in-house) company social networks. It is becoming very difficult to distinguish between the mobile as a business and a personal tool.

Recent research by Forrester indicates that 80% of customers will consult with and rely on what their colleagues and family are saying about products and services before making a choice. Only 36% of customers rely on sales people. People also take to social media to source products, complain and sometimes to praise for good service. They find their jobs through web-sites and will decide which companies to work for based on what others are saying. They will even Google the next person they are meeting and will look for commonalities and interest points in the conversations that they initiate. In fact, if you do not find someone online it immediately will raise suspicion and reduce the perception of transparency with that person. Customers are also increasingly choosing to interact with products and services in more complex applications that allow them to see inside of the enterprise and at the same time compare themselves with others.

Measurements have changed with likes, referrals and promotions on key sites being the order of the day for daily activities. Some thinkers are moving beyond these basic measures with Zachary Reiss Davis from Forrester hinting that companies need to rethink their digital measures to move beyond acquisition to understanding them through “social selling”.

The first measure he proposes to achieve this is “social reach,” where you’re measure your ability to give information to people who may or may not know about the brand. As a company you increase your social reach by your employees being associated with your brands, publication of relevant information into social networks and well placed advertising. Campaigns and sites on social media attract others to understand you better and regular communication and active growth of the network ensures that you remain relevant. Much like in the real world you use advertising to expand your reach, but more importantly you must enable others to advertise on your behalf to leverage the real power of digital marketing.

The next stage and measures the becomes “social depth.” Sales can have the greatest impact in this stage by communicating crucial messages and forming deeper relationships with those who are not yet customers, but are good targets. The question is to what extent the company understands and acts to the needs and intents of their followership. It is great to have a lot of followers but not understanding what drives them has the potential to backfire quite badly. By analysis of followers and interested parties and responding to their needs the company can maximise both the impact of its messaging and growth of the target base. This can be optimised through analytics on properties that organizations control, e.g. communities and forums on their websites and social networks. Most companies have not in real terms understood who is interested in building a digital relationship with them.

The most crucial aspect, and third stage, is to define the “social relationship” that your organisation wants with the customer. Your customers have purchased from you and are already engaged with your brand, so they are the most inclined to pay attention and interact with what you’re saying on social networks like Google Plus, Twitter, Facebook and Linked-In. By fostering an open relationship with your customers and giving them the tools to advocate you, you can create a powerful exponential followership. By being ignorant of what people are saying it can destroy masses of brand equity in a short space of time.

These three ideas together has come together in a concept called social selling in which social media is used to bring back the personal touch through the mass customised selling process.

Companies are moving beyond email marketing, with blogs, webinars and structured data making the enterprise accessible and visible and allowing customers to compare experiences and form part of the process of delivering goods and services in the organisation. Blog posts drive applications and Youtube videos show you how to use them, while adverts remind you that they are there. This type of integrated messaging is the way that selling will happen in the future and for many is happening today.

Not just selling is affected – supplier relationships, recruitment, sourcing and selling are all deeply impacted by social media and it is only a matter of time until communities are more open and applications more universal and commonly used to conduct business in new ways.

It is already standard practice for firms to review social media profiles of candidates. Increasingly suppliers are looking for referrals and location based searching, mobile advertising and integrated supply chains are ensuring that the product gets to the customer.

Most IT people will almost automatically quote Gartner on the major trends in IT – cloud, mobile, big data, automation. They all seem to miss the obvious and biggest trends since the idea of time was invented, which is – SOCIAL MEDIA. It may be because they have no good way to spend money on it and there is no big thing to buy to make it work. So what happens is that they put in new firewalls to block people from using it. It just re-emphasises that digital strategy and IT strategy seems to have very little to do with each other and potentially puts the business on a path to miss a major part of what is happening with their customer base. Business is becoming social faster than any other trend in business or in IT in recently history.

While all this is going on, there are actually firms that still try to restrict access of their staff to the Internet and sceptics still believe that social media is a hoax by marketing firms.

Reed (www.reed.co.uk) published a study that shows that one third of companies allow access to social networking at work, one third allows limited access and one third does not allow any access at all. In those that do – people typically check social media sites once to three times a day, with only 36% of users doing so on the company computer. In those that do not – people check social networking 5-10 times per day using mobile and other devices.

With an increasingly young workforce in a world in which developing economies rule the markets – social media will increasingly become the differentiator between those that are linked to the new economy and those that are not. While there may be industries in which social media may not be immediately relevant, it is clear that the future for all enterprises must clearly answer how the company will respond to the digital world and what mechanisms and strategies it will put in place to manage its digital presence and integrated digital business processes.

Sources:

http://hearsaysocial.com/2013/06/social-selling-webinar-recap/

http://www.dowitcherdesigns.com/blog/social-networking-in-the-workplace-good-or-bad/

http://www.shrm.org/about/foundation/products/documents/social%20media%20briefing-%20final.pdf

http://misq.org/skin/frontend/default/misq/pdf/V37I2/SI_DBS_BharadwajI&O.pdf

information accounting up the big data tree

The information deluge is real. It is all around us. More servers are spitting out more information as the internet is growing and we are all collecting more information on more aspects of every day living.

While some of the initial thinkers around big data is still searching for great ways for big data promises to become real – there is a little discipline that shows potential as a big idea.

Enter information accounting.

A couple of years ago there was some people that talked about the idea of information accounting. A type of “double entry” system for information that would account for the data assets of an organisation. The idea never really took off to the extent that some people today totally reject the notion that there is any value in knowledge management as a discipline.

Lets take a step backwards and look at the invention of accounting.

Luca Pacioli (1445 – 1517), also known as Friar Luca dal Borgo, is credited for the “birth” of accountancy. His Summa de arithmetica, geometrica, proportioni et proportionalita (Summa on arithmetic, geometry, proportions and proportionality, Venice 1494), was a textbook for use in the abbaco schools of northern Italy, where the sons of merchants and craftsmen were educated. It was a compendium of the mathematical knowledge of his time, and includes the first printed description of the method of keeping accounts that Venetian merchants used at that time, known as the double-entry accounting system.

Although Pacioli codified rather than invented this system, he is widely regarded as the “Father of Accounting”. The system he published included most of the accounting cycle as we know it today. He described the use of journals and ledgers, and warned that a person should not go to sleep at night until the debits equalled the credits. His ledger had accounts for assets (including receivables and inventories), liabilities, capital, income, and expenses — the account categories that are reported on an organisation’s balance sheet and income statement, respectively. He demonstrated year-end closing entries and proposed that a trial balance be used to prove a balanced ledger. His treatise also touches on a wide range of related topics from accounting ethics to cost accounting.

There is also hindu mythology that attributes a method for accounting to Hemadrapant who had created the “Bahi Khata” which was both a method of accounting for the family tree and also a ledger system.

Where initial information accounting systems failed is that it took a transactional (vs an asset based) view of information. We wanted to account for the information we had in the system and forgot that this only creates more data.

In approaching the idea of information accounting we have to realize that information is an asset that is either being used or not.

Information at rest is a dead asset or a liability and information in motion – or information that is being transformed using a viable business process, is a profitable venture.

This means that information being collected is an income statement element and information becoming out of date, ads to the ifnroamtion expense line.

There are thus implicit paradigms that can be used to account for the cost of maintenance of information, ethical considerations and “process” capital. The idea of process capital is the ways in which information can be transformed to effectively move from being gathered into being used and would represent the value of management in a traditional organization and is more likely to be similar to BI and analytics in today’s world.

Conceivably it would then be possible to draw up an information balance sheet and its purpose would be to indicate the health and wealth locked in the data sets that we carry. Information managers can then apply specific processes, paradigms or design patterns to the data and this would unlock value.

This all sounds very complex and may only be of limited use.

On a more practical level – we can also ask ourselves to what extent we are carrying around useless information and to what extent existing information sets our there about ourselves is useless. For a lot of us our MySpace accounts are definitely a liability – because most of us have not used it in more than 5 years and it is likely to be still alive? However our LinkedIn and Facebooks accounts are a far more valuable asset. By the principles in a potential information accounting schema we could value these systems in terms of how current it is, what we are doing with it, and to what extent it adds value to our objectives.

This information accounting paradigm would then offset the asset value in the one account vs the liability value implicit in the other account and can develop a workable method for measuring “information value added”.

Another potential use is in CRM systems in which the real question is often to what extent is the information that I collect about people useful. So the essential metric is one that asks – how many of these relationships in this system are being and is potentially useful to maintain, or to what extent does sending another email to this base limit or damage my brand. Careful analysis and an information accounting paradigm would be able to match the statuses to a framework that shows where the leads are in a pipeline and to what extent the in/out flow of information is leading to value being created for the end customer and thus for my business.

Every accounting system needs a fundamental equation – maybe a place to start is to say that

Information + Process = Information Income

Information Income + Accumulated Information Income = Information Assets

Information Decay = Information Expenses

Information Expenses + Accumulated Information Expenses = Information Liabilities

Information Assets – Information Liabilities = Information Value

Change in information value over time is information value added or information value destroyed. There must also be something in the system that allows for measuring the speed of a process and relates it back to the rate of both information income and a natural “depreciation” in all information as no information is really static.

All seems logical for now. The real challenge would be to map these into simple dashboards from complex sets of information at a first level and on a second level to determine the impact of different events in a system to these parameters.

So how does ethical considerations impact information accounting? It does potentially slow down collection of information, but speed up the transformation process.

Initiatives can also be take into consideration based on their potential impact by determining if it adds to the velocity of information being transformed or not.

So it may not be a workable science yet – but there is definitely something to think about in this concept.