SOCIAL BUSINESS SPECIAL...Measuring Returns in Social Business

Measuring Returns in Social Business 

A more collaborative work environment leads to greater competitive advantage and profitability

How do you quantify return on investment (RoI) of a social business? By their nature, social technologies are more free-forming, making their potential more valuable, yet unpredictable, or may I say unimaginable. A successful social business can incur external and internal benefits. Internally, companies can see RoI almost immediately. Synchronisation of analytics application into social business initiatives — where insights from social networking sentiment can be derived anytime, anywhere and put to work in real-time — leaves business with the recipe for success.
How do we measure the internal benefits then? Internal, or ‘soft’, benefits such as greater employee collaboration, streamlined communication or improved product development are clearly beneficial for an organisation. Yet, these benefits cannot be measured easily in order to match up to the growing customer satisfaction and skyrocketing sales. Focusing solely on forms of new revenue or sales resulting from social engagements implies that organisations are overlooking some of the main components of RoI in social business. More attention must be paid to shifting the nature of work and structure of businesses and the impactful results that organisations incur by making such transformational changes.
Companies that are seeing real business value from social capabilities are doing more than launching an ad-hoc Twitter campaign or putting together a corporate Facebook
page. They are embedding social tools into business processes, enabling the business as a whole to become more strategic, engaged, transparent and agile.
Social tools combined with a culture of collaboration enable a more effective workforce — across all departments in an organisation. By enabling employees to locate experts quickly and collaborate across geographically-distributed teams, employee productivity and engagement is higher. This, in turn, leads to benefits such as reduced expenses related to travel or speedy development of new products or sales approaches. New social tools offer some key capabilities that can relieve some of the pressure on email, but they will not replace an important enterprise tool that has become the most preferred communication vehicle for many. The future of email is social, and the future of social collaboration tools includes email as an integral part of the enterprise communication suite.
On the contrary, many times, due to expanding employee base, it brings about a huge communication gap within an organisation besides just the geographical factor. This is where the social collaboration tools play a huge role in bridging that gap and making sure communication is carried out smoothly. The aim of every business is to attract new customers and retain existing ones. Imagine a call centre for a large national bank where all customer inquiries are channelled through one general number. Social enterprise tools enable customer service representatives to work more efficiently and provide higher-quality service as there is more immediate access to content and expertise within the organisation. By streamlining this process, there is a better customer experience, deepening customer loyalty and boosting future sales.
As knowledge- and idea-sharing increases, the rate of innovation is accelerated; an important asset to businesses now more than ever. Moving from idea-sharing sessions with a handful of C-level executives behind closed doors, to collaborative and transparent brainstorming across a company, leads to shortened product development cycles and improved revenue streams.
By creating social communities and microblogs, an organisation is well-equipped with the ability to crowd-source new product and business ideas. It is an innovative challenge of sorts for companies: that are looking to engage their employees and encourage them to come up with innovative ideas in the best interest of the company. By allowing employees at any level to bring ideas to the table, businesses create a flat, collaborative environment leading to ideas that are more profitable. The days of turning your back on social tools are gone. Companies that have adopted social practices and tools early to create amore collaborative work environment are gaining competitive advantage in their market and becoming more profitable. It is important to remember that we are still in the early years of social business. Like any innovation, we need to keep a track of our efforts and what we are doing and how we are evolving with time in terms of technologies and practices. Only then can one truly have a barometer to measure the RoI.
As social businesses evolve, we’ll continue to see numerous studies around the RoI of social business and just how transformative this cultural and technological shift can be.
Forrester Research estimates that the market opportunity for social software will grow to more than $6 billion by 2016, an increase of 60% annually from 2010. Social business doesn’t just mean broadcasting to customers over social networking sites. Collaboration tools get at the heart of what it means to be a social business, taking group connectivity deep into the company culture and converting siloed, offline communication habits into broadly-shared asynchronous collaborations that keep everyone informed, invested and empowered to drive the organisation forward.
(HIMANSHU GOYAL -The author is country manager for IBM Social Business and
Collaboration Solutions at the IBM Software Group)

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