In a number of articles that I read recently, particularly a brilliant study by the MIT Sloan School of Management and Delloitt, I observed consistent evidence that the most ubiquitous use of Social Media in the enterprise is in customer-facing activities – Marketing, Sales and Customer Service. As my friend Mark Schaefer wrote, there is little evidence of Social Media being used at the Core of the Enterprise, there where things actually get done.
According to Gartner, 80% of the projects to rollout social media in the enterprise between now and 2015 will fail, largely because of lack of business focus. I have read in several sources that one of the challenges of Social Media projects is the difficulty in calculating ROI or the weakness of the business case for its deployment.
But why?!… Why is it so difficult for this new medium of communication to penetrate the Enterprise when it was so easy for Facebook to penetrate our society?
There can be several ways of looking at this inertia but I have concluded that the main problem is in the classical Functional Hierarchical by which most corporations are organized. To put it simply, a structure whereby people work in Functional silos is anti-collaboration while open, transparent collaboration is precisely what the use of social media is all about. Business cases are difficult to make because people try to make them within individual silos. What is the benefit of a Quality Assurance department deploying social media?… Tough call! The benefit of social media can only be understood and experienced when it is deployed in the context of end to end business missions or business processes, not within parts of processes, which is what functional applications try to do.
The great power of social media as a communication medium is in how it facilitates the networking of people. It is the fastest, most effective and most versatile form of networking there is. When it occurs, responsiveness to operational issues or business situations is incredibly swift. Individuals of multiple skills involved in delivering a customer-recognized mission can process business, resolve obstacles and even improvise new processes, with a versatility that cannot be matched by the rigid mechanics of functional silos. It is here that the obstacle lies. Companies have to liberate employees from their functional silos so that they can interconnect freely and combine their skills spontaneously and without constraints.
When individuals are induced to work within their functional ‘brotherhoods’, they are discouraged from collaboration – even if collaboration is a published “value” of the enterprise. Quite simply, it is far easier and convenient for people to work amidst peers of similar skill sets than to commingle with people from diverse skill groups. In large organizations, employees ‘seek shelter’ in their monochromatic departments from the noise of business traversing the organization. Functional hierarchies assign power to owners of these functional groups which then entrenches them further into their monochromatic perspectives. As a result, cross functional collaboration is sporadic and fleeting since it occurs mostly in meetings of relatively short duration. The structure fosters secrecy and territorialism when the essence of collaboration is in openness and transparency.
Business cases are difficult because the business cases that are best recognized are those that relate to enterprise objectives or goals – e.g., deliver great service to customers; drive the supply chain to deliver product when customers order product. These broad goals can only be achieved by cross functional collaboration – which is against the nature of a functional hierarchy.
The only time that enterprises can benefit from the full power of social media is when they learn to operate according to a new model, a model that is based on the dynamic networking of clusters of multi-skilled individuals focused on objectives or missions that are customer-recognized, i.e., that add value to customers in a manner that customers would relate to. For this to occur Enterprises have to evolve from getting people to work within ‘skill brotherhoods’ to driving people to work within these groupings centered around broad missions. Only when the way people work is coherent with the collaboration metaphor – based on sharing, openness, transparency and empowerment – will the use of Social Media then become natural and well accepted, nay desired!
The big challenge then is not to figure out how to deploy Social Media as a technology but rather how to evolve from a Functional-Silo way of operating to an Open Network way of operating. There is a Social Model of company operations that is the antithesis of the Functional model. Until this distinction is recognized, this evolution will not be possible. However, there are and will be companies who get it. Young people from Generation Y and Z only understand a world that is connected freely. It is incomprehensible to them that people are not connected, that they go through their day working within islands isolated from the rest of the enterprise. Young companies created by young people embed this view of a connected world in the way they structure the workplace. And as Generations X and Y take over the workplace in the decade ahead (by 2020, only 25% of the workforce will be baby boomers), the evolution from Silo to Social will take place naturally.
Which brings me back to the big question I raised a few postings ago: are you creating a company of yesterday or a company of tomorrow, today. Functional Silos are passé; they had their place at a time when the world was slow and the job was to make lots of volume of a few things. Today’s conditions are completely different – the mission is to customize products and services to individual customer needs rapidly, to change and adapt to a fluid market as rapidly as the market changes. It is the era of the real time corporation and enterprises clustered around customer segments. In this new world, only an Enterprise with immense social networking capacity can survive – because it is a world that was born precisely because of the Internet and its power at networking people.
For more on how to organize people in multI-skilled groups focused on business missions, go here.