In 2011, the US hit a milestone — more than half of all adults visit social networking sites at least once a month. But when it comes to using social-networking technologies inside organizations, many business leaders are at a loss to understand what value can be created from Facebook-like status updates within the enterprise. Some organizations have deployed social-networking features with an initial enthusiastic reception, only to see these early efforts wither to just a few stalwart participants.
The problem: Most companies approach enterprise social networks as a technology deployment and fail to understand that the new relationships created by enterprise social networks are the source for value creation. Yesteryear, internal technology departments could force software on business units, but in today’s consumerized world, business units can adopt enterprise software, often without IT ever knowing. As a result, a new approach is required that focuses on four key ways that relationships create value through enterprise social networks:
This is the first of two reports on enterprise social networks, with this one focused on how it creates value for organizations. The next report will focus on maturity models and the future of enterprise social networks.
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The report also includes input from 13 technology providers, 185 end users, and surveyed 81 ESN decision makers from companies with over 250 employees (see below in Related Resources for links to the data). A few of the findings and graphics from the report are included below.
There was only moderate impact on business goals. On a scale of 1 to 4, the highest impact seen – improving collaboration between departments/teams -- scored only a 2.91 (see Figure 5 below).
A key reason for this is that there were few metrics used to gauge effectiveness. Most metrics were engagement-oriented in nature and not necessarily tied to business impact. For example, the top three metrics used were 1) More/faster collaboration across the company; 2) Frequency of use; and 3) Engagement across the company (% of employees using it) (see Figure 6-1 below).
In fact, no organization surveyed believed they measure ESNs very well, and only 31% felt they measured ESN impact somewhat well. A quarter admitted that they didn't measure at all! (see Figure 6-2 below).
Four Ways Enterprise Social Networks Drive Value
Despite the promise and potential for ESNs, they have only received moderate traction. The problem is that most ESN deployments to date have been treated as technology deployments with a focus on adoption and usage. A different way to think about this is that ESNs represent a new way to communicate and form relationships — and because of that, can bridge gaps that exist in terms of information sharing and decision-making processes. To better understand these use cases, we found that they boil down to four different types of gaps in the organization — tough problems that can’t be addressed by the current technology, process, or culture.
Enterprise Social Network Action Plan
To be successful with your ESN, you need thus to focus on how relationships can close the gaps of information flows and decision making in your organization. To do this, you should take four steps, with your technology selection coming last, not first.
In the spirit of Open Research -- and to spur further discussion on the topic of enterprise social networks, we are also making available a PDF summary of all questions asked in the survey, a PowerPoint of the graphics, and the full data set. If you discover additional insights, we ask that you share back your findings with the community.
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This independent research report was 100% funded by Altimeter Group. This report is published under the principle of Open Research and is intended to advance the industry at no cost. This report is intended for you to read, utilize, and share with others; if you do so, please provide attribution to Altimeter Group.
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