Measuring the effects of social tools in the enterprise

1Executive Summary

A new wave of cloud-based enterprise social tools is sweeping across the corporate landscape. Apps such as Yammertibbrpresent.ly, Socialtext and Salesforce.com’s Chatter, to name a few, are showing up in tech-savvy startups and more-traditional organizations alike. Certainly, these tools are providing new collaboration and communication channels for employees. But perhaps more importantly, they could reduce hierarchy in businesses, flattening traditional structures by stripping out management layers.

The latter sounds great in theory: Management generally believes that flatter organizations allow for more-effective communication, because the communication doesn’t have to be routed through complicated managerial layers. Google is a good example of such an organization. But in reality, will these new social tools reduce hierarchy, or will they just provide a way for employees to “goof off” during work hours?

To find out what impact these services have on organizations, I decided to speak with a few businesses that have actually implemented the social tools and spent some time using them.

Initial impact on the enterprise

The pace of organizational change that these tools have allowed surprised me. You might expect a tech-savvy business like the accounting and consulting firm Deloitte to enthusiastically embrace social tools, but even a very traditional, slow-moving organization like the American Automobile Association (AAA) has implemented Yammer — and reported seeing significant changes just one year into using the service.

I was also surprised by the way these very different businesses followed similar patterns of adoption: Generally, the social tool is first introduced experimentally by a team member to facilitate communications among a small team of techies. After a successful initial period within the team, usage grows virally throughout the organization, until senior management takes note and advocates use of the tool. Usually the tool is rolled out for the whole organization 6 to 12 months after the initial adoption. Both AAA and Deloitte reported a small initial trial of Yammer, followed by an explosion of adoption after the tool was enthusiastically advocated by C-level executives.

Benefits of social tools

Different companies also reported similar types of benefits and changes within their organizations as a result of adopting these social tools. Here are a few:

Breaking down silos: All the businesses I spoke with reported this as one of the major benefits of implementing social tools. It’s difficult to avoid knowledge silos as an organization grows, particularly if teams are separated geographically. Social tools build bridges between groups of employees so that valuable information can be shared across the company. The American Hospital Association, for example, has 12 separate entities working independently within the organization, including the Society for Healthcare Consumer Advocacy, the Association for Community Health Improvement, and the American Society for Healthcare Engineering. Socialtext is helping to break down silos by facilitating communication among those entities. While more-traditional tools like email and an intranet can also help to spread knowledge throughout an organization, social tools seem to do this almost naturally and serendipitously as a by-product of people talking to one another.

Connecting like-minded individuals: In larger organizations, it’s impossible to know every single employee and be aware of what they do or what they might be able to help with. Tools like Socialtext and Yammer are much more dynamic than a traditional company directory; they allow users to discover employees outside their department are doing, what their capabilities are and provide a window into their discussions.

For example, Deloitte Australia is an organization of some 5,000 people, with 12 offices in several states. Yammer is now helping to connect employees from those different offices, bringing them together to work on projects. Social tools can help connect individuals who are working on different teams across different functions or who are separated by geography. They can also make it easier for managers to keep track of their employees without adding additional managerial overhead to their plates.

Reduced need for meetings: Social tools help keep everyone on the same page, replacing — or at least reducing the need for — many time-consuming meetings. I was expecting to see organizations reporting that they had managed to do away with some routine update or status meetings. But some businesses have even gone beyond that: AAA, for example, reported that it has moved some decision-making processes from committee meetings to Yammer.

Leadership access and buy-in: One of my most surprising findings was how enthusiastically senior employees have adopted tools like Yammer and Socialtext. As you might expect, the early adopters tend to be younger, tech-savvy employees, the ones who will heavily use social tools in their personal lives and have extensive experience to parlay into corporate social tools. But as soon as senior managers realize the kind of direct access to employees that social tools can provide, they tend to become some of the most enthusiastic evangelists and most-prolific users.

As noted previously, both Deloitte and AAA reported a massive upsurge in the popularity of their social tools after C-level executives evangelized their benefits in town hall meetings. Leaders seem to love these tools, as the tools allow them to see what’s going on, “take the temperature” of the organization and allow direct communication with staff without having to go though middle management. This direct access has been reducing the hierarchy within organizations that use social tools.

Organizational network analysis: The data produced by the use of social tools can be used for organizational network analysis (ONA) — a method for studying communication and social networks within an organization. Deloitte, for example, is using data from Yammer in its ONA efforts, which in turn should help the business to streamline its structure.

While I’ve only spoken to a handful of companies and can’t say that every business that implements a social tool will see these benefits, I believe that these apps do have the potential to reshape the way our businesses are structured. Many organizations are already using corporate social tools: According to a new survey by Jive Software of workers in medium and large organizations, 28 percent of employees already use an internal social networking tool. The same survey also reported that 66 percent of executives believe that social applications for business represent a fundamental shift in how work will get done and how companies will engage with customers.

Given their comparatively low cost (from free to a few dollars per user per month), the ease of implementation and senior management’s generally positive view of them, I think we’ll see much more widespread adoption of these social tools in a relatively short space of time.

Relevant analyst in enterprise mobility
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