Social Tools Don't Make You A Social Business

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Nilofer Merchant (@nilofer) shared a valuable perspective on the word social as it pertains to business in her Harvard Business Review article. Merchant described the evolution of the terms social media, Enterprise 2.0, social business, social innovation, and social era, providing a contextual understanding of each term.

The term social business was created to describe how companies can generate greater value for their ecosystem by adding a social overlay. The first-generation social business was defined by Nobel Peace Prize winner Muhammad Yunus (@Yunus_Centre) as a company dedicated to solving human problems. The term evolved to a second generation by the Dachis Group (@dachisgroup) to incorporate a social element interconnecting the various business constituents including marketing, R&D, customer support and suppliers. This second-generation meaning of social business is often tied to shared value and can encompass the use of social media tools.

In our book, The Pursuit of Social Business Excellence, Brad Martin and I describe the social business as an environment that feels like a small town; people know your name, doors are left open, and the lights are on. For us, social business transformation was less about the use of technology to improve connectedness, and more about a mindset of collaboration and co-creation of value. Our ability to grow our business and delight customers was a function of culture, people, process and, last, technology.

[ Why go social? Read Social Collaboration's Big Payoff: Increased Sales. ]

We found there are a number of specific markers that accompany and validate the social transformation progress. Business leaders should keep in mind that the purpose of collaboration is to improve execution velocity and delight customers. It is important to demonstrate to all constituents the ability to drive sustainable growth and bolster customer loyalty and commitment, as a result of collaboration.

-- Pragmatic optimism: A social business defaults to "yes" and then rationalizes to the desired disposition. A bias for action with a positive mindset leads to an agile and change-embracing culture. There is no safety in the status quo. Optimism is often fueled by teamwork and collaboration.

-- Minimal layers: A social business is flat, versus the traditional hierarchical business structure. The distance between an individual contributor and the CEO is but a few layers. In a social business, there is a direct line of communication between entry-level employees and senior management.

-- Leadership by example: In a social business, all leaders and executives are socially engaged. If your CXOs are not social, your business is not social. Ask a social business executive, "Who is the smartest person in the room?" and she will answer: the room. Social executives are accessible, active listeners and connectors of the business, always seeking the best and fastest path toward progress and growth.

-- The best ideas win, independent of titles: In a social business, ideas and information flow horizontally, vertically, from the bottom and from the top; throughout the business. Ideas are like sounds, and they should be heard through the seams of the social fabric. In the absence of sound, ideas die. The most damaging syndrome is the HIPPO (highest paid person's opinion) syndrome, whereby all the decisions are ultimately dictated by the biggest title. The best ideas must win. That's the biggest benefit of being social.

-- Social and business process integration: Social businesses have integrated social channels into their business processes and workflows. This means integrating social media networks into CRM solutions. Social CRM is often the first sign of social business adoption, aimed at increased visibility and execution velocity. Adoption of social media is a great first step but a truly social business is one that integrates social networks and all of its contact channels into a single relationship management framework.

-- Adoption of gaming techniques: In a social business, internal competition is welcomed. This means social businesses embrace gamification to drive employee, customer and business partner engagements. Gaming concepts, packaged into an overall CRM strategy, can unlock the full potential of the organization.

-- Safe environment: In a social business, an idea or red flag from anyone can reach the CEO directly, without a middle man and without repercussion. The environment is safe and collaborative, where failures are viewed as part of the learning experience. That said, the agile business adopts a "try it, fix it, try it again" iterative improvement philosophy.

-- Shared accountability: Social businesses share complete interdepartmental performance metrics as a means to foster collaboration. Social businesses extend performance metrics to customers and partners with connection to both people and products.

-- Reflective and iterative: A social business continually challenges existing assumptions and communicates a desire for mid-course corrections or pivots in advance of execution. In a highly collaborative business, experiments are welcomed; innovation is not about better sameness.

-- Social people and social products: Every information source in the ecosystem should be used to help employees make better, more-informed decisions. Information sources include people and products/machines. The network social graph of an advanced social business includes both people and products. In the near future, wearable products, sensor technology and machine-to-machine (M2M) communication will include social channels.

In summary, a social business is much more than a business that uses social media. Social collaboration success is more a cultural and philosophical achievement than technology adoption. Collaboration is hard work but it doesn't have to be complex work. In fact, collaboration can simply start with four words: What do you think?