• Like
Negocio social: ¿Realmente, qué están haciendo las compañías?
Upcoming SlideShare
Loading in...5

Thanks for flagging this SlideShare!

Oops! An error has occurred.

Negocio social: ¿Realmente, qué están haciendo las compañías?



Published in Business
  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
    Be the first to comment
    Be the first to like this
No Downloads


Total Views
On SlideShare
From Embeds
Number of Embeds



Embeds 0

No embeds

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

    No notes for slide


  • 1. In collaboration withRESEARCH REPORT 2012 FINDINGS FROM THE 2012 SOCIAL BUSINESS GLOBAL EXECUTIVE STUDY AND RESEARCH PROJECT Social Business: What Are Companies Really Doing? Social business is still just getting started. But its value is clearly emerging for marketing, innovation, operations and leadership. By David Kiron, Doug Palmer, Anh Nguyen Phillips, Nina Kruschwitz
  • 2. AUTHORSDAVID KIRON is the DOUG PALMER is a ANH NGUYEN PHILLIPS NINA KRUSCHWITZexecutive editor of In- principal at Deloitte is a senior manager is an editor and thenovation Hubs at MIT Consulting LLP and within Deloitte’s U.S. special projects man-Sloan Management leader of Deloitte’s Strategy, Brand & ager at MIT SloanReview, which brings Social Business prac- Innovation group, Management Review,ideas from the world tice. He can be reached where she leads strate- where she coordinatesof thinkers to the exec- at dpalmer@deloitte. gic thought leadership the publication’s Inno-utives and managers com initiatives. She can be vation Hub activities.who use them. He reached at anhphil- She can be reached atcan be reached at lips@deloitte.com ninakru@mit.edudkiron@mit.eduCONTRIBUTORSNatasha Buckley, Senior Manager, Deloitte Services LPJonathan Copulsky, Principal, Deloitte Consulting LLPAlex Dea, Business Technology Analyst, Deloitte Consulting LLPDeb Gallagher, Director, Marketing & Operations, MIT Sloan Management ReviewMartha E. Mangelsdorf, Editorial Director, MIT Sloan Management ReviewMark White, Principal and CTO, Deloitte Consulting LLPLaura Winig, writerCopyright © 2012. Massachusetts Institute of Technology. All rights reserved.For more information or permission to reprint, please contact MIT SMR at:E-mail: mitsmr@pubservice.comFax: 818 487 4550, attention MIT SMR/PermissionsPhone: 818 487 2064Mail:  IT Sloan Management Review M PO Box 15955 North Hollywood, CA 91615
  • 3. CONTENTS RESEARCH REPORT 2012 2 / Preface 10 / Where’s the Business Value? (Not Just in Marketing) • Marketing (example: McDonald’s) 3 / Key Findings • Innovation (example: Lego Group) • ocial Business Matters Today — and S • perations (examples: Nationwide, O Will Matter Even More Tomorrow Capital One, Almond Board of California) • ome Leaders Are Enthusiastic, S • eadership (examples: Luminoso, L but Lack Metrics to Prove Value Cara Group) • Size Matters • Media and Tech Are Leading the Way 15 / Connecting Leadership and Culture 5 / Introduction • Vision and Strong Management Support • Sharing Knowledge • Other Requirements 6 / The Growing Importance of Social Business • The Challenge of Social Business 17 / Putting Social Business into Action • tart with a Long-Term Vision S 7 / Who Values Social • Assess Where You Are Today Business Today May • Support Adoption Surprise You •Measure Results, Not Adoption • Opposite Ends of the Spectrum •Industry Spotlight: Media and Tech 18 / Summary •The View from the C-Level 2 Appendix: The Survey 0  21 About the 28 Acknowledgments  Questions and Research and Interviewees Responses SOCIAL BUSINESS: WHAT ARE COMPANIES REALLY DOING? • MIT SLOAN MANAGEMENT REVIEW 1
  • 4. R E S E A R C H R E P O R T S O C I A L B U S I N E S S : W H AT A R E C O M PA N I E S R E A L LY D O I N G ? Preface The rapid adoption of technology-based social networking has been transforming politics and social norms on a global scale for the past decade. Will social networking and social software have a similarly transforma- tive effect on business? Are they already doing so? What kinds of enterprises are benefiting the most? And how are they benefiting? To answer these questions, MIT Sloan Management Review and Deloitte1 conducted a survey of managers from companies in 115 countries and 24 industries. We had 3,478 respondents to our questionnaire. They represented a wide range of management roles (from coordinators to board directors), functional areas and business sizes. We supplemented the analysis of our survey results with interviews with thought leaders and business executives, as well as a review of recent research on social business. Our in-depth interviews included con- versations with senior managers from companies at the cutting edge of social business practice, including McDonald’s, IBM, Salesforce.com, SAP and Yammer. Although enterprises have only just begun to embrace social business, many leaders — especially in the media and technology industries — are enthusiastic about its value. Others are more cautious but recog- nize its potential a few years out. Our survey points to marketing and innovation as key areas for capturing value, while our interviews suggest that operations and leadership stand to benefit as well. To capture this value, companies should consider taking steps to ensure that their leaders and culture are aligned with the new opportunities. We conclude with considerations for how to put social business to work in your enterprise. Leaders need to recognize that social business: • Adds value far beyond marketing; • Needs leadership support to gain traction in the organization; • Can deliver benefits to leadership via strategic insight and strategic execution. We hope that this report provides executives food for thought as they consider how to incorporate social business activities into their organization. For more about our work in social business, including exclusive in-depth interviews and additional feature articles, please see the online exploration in the Social Business area of MIT Sloan Management Review’s website: sloanreview.mit.edu/socialbusiness and at Deloitte’s website: www.deloitte.com/us/socialbusinessstudy.2 MIT SLOAN MANAGEMENT REVIEW • DELOITTE
  • 5. Key FindingsSocial Business Matters Today — and Will Matter Even More TomorrowA majority of respondents (52%) to our survey believe that social business is important or somewhat impor-tant to their business today. Fully 86% of managers believe social business will be important or somewhatimportant in three years. Social business is viewed most often as a tool for external-facing activities. •  urvey respondents say marketing, sales and customer service are most responsible for driving social S software use in their organizations. •  n average, respondents say the most important use of social software is for managing customer rela- O tionships. • The second most important use of social software is to innovate for competitive differentiation.Key takeaways: Managers surveyed believe that social software will become increasingly important to theirorganizations during the next few years. Although most managers continue to view social software as an ex-ternally facing activity, its relevance to innovation is also being recognized.Some Leaders Are Enthusiastic, but Lack Metrics to Prove ValueMost respondents to our survey believe that successful social business activities require leadership butacknowledge that their organizations are not measuring social software use. •  n our survey, leadership and a clear vision are cited most frequently as critical to adoption of social I software. Lack of management support is cited most frequently as the biggest barrier to adoption. •  t the same time, the most common answer to the question, “How do you measure social software use?” A is: Do Not Measure. •  Leaders most responsible for the strategic direction of an organization — CEOs, presidents and manag- ing directors — are almost twice as likely as CIOs and CFOs to say that social business is important to their organization.Key takeaways: Social business depends on leadership. Metrics may not be critical when companies areexperimenting with using social software, but as social software use becomes more important to an organi-zation, having metrics in place can help managers assess, encourage and reward related behaviors. Thesemetrics may be even more important in organizations that need to shift their cultures to be more compati-ble with social business. In addition, while the survey results indicate that social business depends onleadership, our interviews indicate that leadership can be improved with social business. CEOs may recog-nize this more than other members of the C-suite. SOCIAL BUSINESS: WHAT ARE COMPANIES REALLY DOING? • MIT SLOAN MANAGEMENT REVIEW 3
  • 6. R E S E A R C H R E P O R T S O C I A L B U S I N E S S : W H AT A R E C O M PA N I E S R E A L LY D O I N G ? Size Matters Respondents from small and large companies say social business is important to their organization at twice the rate of managers from midsize companies. •  o back their social business activities, both small companies (those with fewer than 1,000 employees) T and large companies (those with more than 100,000 employees) tend to have stronger management support for social business initiatives than do midsize companies. •  ver time, the gap between small, midsize and large companies may narrow. When managers were O asked about the importance of social business to their organization three years from today, there was lit- tle difference between how these groups view the future importance of social business. Key takeaways: With social tools, small companies are demonstrating that they can appear larger than their actual size; large companies can appear less like corporate behemoths. Midsize companies see the advan- tages of social tools but, in general, do not see themselves exploiting these advantages for another few years. Media and Tech are Leading the Way Based on our findings, social business is thriving in at least two industry sectors: entertainment, media and publishing (Media) and IT and technology (Tech). •  n the Media industries, 74.9% of managers say that social software is important or somewhat impor- I tant to their companies today. •  n the Tech industries, 65.9% of managers say that social software is important or somewhat important I to their companies today. •  anagers who are least likely to say social software is important are from the energy and utilities, manu- M facturing and financial services industries. •  owever, respondents from these industries say that social software will become much more important H in three years. >Energy and Utilities: 7.1% of respondents in this industry say social software is important today, but 46.8% say social software will be important in three years. >Manufacturing: 9% of respondents in this industry say social software is important today, but 50% say social software will be important in three years. > inancial Services: 10.4% of respondents in this industry say social software is important today, but F 58.4% say social software will be important in three years. Key takeaways: Some industries are seeing more value from social tools than other industries. But even managers in industries that place a lower value on social business believe social tools will become much more valuable over time. Energy and utilities, manufacturing and the financial services sectors expect that social business will become five to six times more important to their organizations in three years.4 MIT SLOAN MANAGEMENT REVIEW • DELOITTE
  • 7. R E S E A R C H R E P O R T S O C I A L B U S I N E S S : W H AT A R E C O M PA N I E S R E A L LY D O I N G ? We’ve Only Just Begun INTRODUCTION S UPERVALU is the third largest grocery chain in the U.S., with a network of 4,300 stores. When SUPERVALU CEO Craig Herkert joined the company in 2009, he realized that in order to be an effective leader, he would need to increase collabo- ration among store managers and enhance his and his management team’s ability to see what was happening across SUPERVALU’s many brands and loca- tions. At the time, store managers met only once a year at an annual conference Social Business: In our survey, we defined social and did not talk regularly with one another. Herkert found a solution to both problems in a business as activities that use single internal collaboration tool that a few store managers were using to share leading prac- social media,social software tices, an application from Yammer, the enterprise social networking company. Herkert and social networks 3 to enable more efficient, effective and supported the use of Yammer across the organization. mutually useful connections Subsequently, more store managers began using the tool to exchange ideas and to post pho- between people, information tos or videos of successful merchandise displays and specials. An experiment run during a and assets.4 These connections can drive business decisions, holiday period demonstrated that stores participating on the Yammer platform had 13% more actions and outcomes across sales revenue than nonparticipating stores.2 Through the many videos, posts and profiles on the enterprise. Yammer, Herkert and his executive team gained visibility into what was happening in their stores without any filters. Herkert was also able to better see the opportunities and challenges related to consolidating SUPERVALU’s brand identity. SUPERVALU’S experience highlights several important themes that cut across this report. First, social business is more than a way to get closer to customers: it is influencing a wide range of activities within the enterprise, from marketing to operations to innovation to leadership. (See sidebar for definition of social business.) Second, social business is more than a phenome- non best suited to technology and consumer goods companies: it is gaining traction in many organizations across all industries. Finally, social business is about more than just collaboration for collaboration’s sake: it can also inform decision making, from the strategic to the mundane.  SOCIAL BUSINESS: WHAT ARE COMPANIES REALLY DOING? • MIT SLOAN MANAGEMENT REVIEW 5
  • 8. R E S E A R C H R E P O R T S O C I A L B U S I N E S S : W H AT A R E C O M PA N I E S R E A L LY D O I N G ? THE GROWING IMPORTANCE Sloan School of Management professor Wanda Or- OF SOCIAL BUSINESS likowski, who researches the interface between technology and organizations and the implications A lmost all of the business leaders we inter- of new digital tools in the workplace, says, “Compa- viewed describe their social business efforts nies need to get started because this is here and it’s in terms of “infancy” or “just beginning” or here to stay, especially for the Millennial generation. “early days.” Those with sophisticated social net- This is what they are used to.” works, including IBM and SAP, stressed that these Perhaps the most telling anecdotal evidence about have taken years to develop. Mark Yolton, senior the present and future of social business comes from vice president of SAP communities and social an unlikely source: the utility sector. In our survey, media, told us that SAP has taken nearly a decade to managers from this sector had the lowest apprecia- refine its developer network, and they are still im- tion of social business out of all the industries we proving upon it. IBM has been developing its surveyed. (See Figure 2.) However, even in this heav- enterprise-wide social network for at least 15 years. ily regulated sector, which has been traditionally slow The importance of social business to organiza- to adopt new technologies and new methods, we tions is expected to grow over the next few years. found a social business proponent. Charles Dicker- While just 18% of all survey respondents believe so- son, vice president of customer care at Pepco cial business is important to their organization Holdings, an American utility holding company in today, 63% say it will be important in three years. the mid-Atlantic region with 1.9 million customers, That’s a jump of 250%. (See Figure 1.) says: “I sincerely believe that social is one of the most Charlene Li, author of the New York Times bestseller important and significant tools that we have in our Open Leadership (Jossey-Bass, 2010) and founder of promotional efforts with customers.” the research-based advisory firm Altimeter Group, de- Dickerson, who has earned industry recognition scribed to us the growing importance of social business: for his work on educating customers about the smart grid, is developing several customer-focused Over the past few years there’s been an awaken- social business initiatives. One of these will use so- ing: people have moved on from asking “what is cial gaming to entice customers to reduce their social business?” to “what do I do about it now? electricity consumption. Customers will be awarded How do I integrate this into my business?” The points based on their energy reduction, which will line between real business and social business is go to a school of their choosing. Whichever school diminishing. has the most points will win prizes, including lap- tops for students. “Customers will reduce their A new generation of workers is building mo- electricity use, post tips and see how others save,” mentum for new modes of collaboration and Dickerson says. “At the end, both the customers and communication enabled by social business. MIT their school systems will be better off.” Pepco itself will benefit as well, as it will achieve a better under- standing of the value customers assign to new services and their willingness to use the services.FIGURE 1 63%THE IMPORTANCEOF SOCIAL The Challenge of Social BusinessSOFTWARE Implementing social business initiatives has been aThe importance of 40%social software is difficult process for many organizations, however.expected to rise by The research and advisory firm Gartner estimates the250% within 3 years. 18% failure rate for social business projects at 70%.5 Why such a high failure rate? A number of fac- tors could be responsible, including not using Today One year Three years from today from today enterprise software to solve a true business prob-6 MIT SLOAN MANAGEMENT REVIEW • DELOITTE
  • 9. Fig. 2 Entertainment, Media FIGURE 2 THE IMPORTANCE OF SOCIAL SOFTWARE BY INDUSTRY 37% and Publishing When asked how important social software is to their organizations, those in the IT and Technology 29% energy and utility industries believed it to be least important, while those in Media and Tech believed it to be most important. Telecommunications / 23% Communications Education 23% Professional Services 19% This need to connect with others is one of three Consumer Goods 17% basic psychological needs.9 The other two — theGovernment / Public Sector 14% need to feel competent and the need to feel autono- Other 14% mous in one’s actions — may also play a vital role in Healthcare Services 14% social business activities. When we asked why re- spondents use social business at work, for instance, Financial Services 10% the top three answers were to network with others, Manufacturing 9% to work more effectively and to voice opinions. (See Energy and Utilities 7% Figure 3.) Motivations to participate in social busi- ness activities are thus far from superficial and even go beyond just our social nature. They can help ful-lem; failing to integrate social software into an fill basic psychological needs.organization’s daily workflow; and a lack of under-standing and support from senior management. Whatever the difficulties organizations have WHO VALUES SOCIAL BUSINESSwith adopting social business activities, social busi- TODAY MAY SURPRISE YOUness appears to be a trend with staying power. OAndrew McAfee, a principal research scientist at ur survey data offers several insights intoMIT’s Center for Digital Business and the author of how the value of social business is per-Enterprise 2.0 (Harvard Business School Press, ceived among small, mid-size and large2009), told us, “I have never spoken to an executive companies, within the C-suite and across industries.or a manager who says, ‘I just long for the days whenwe collaborated in the old style and e-mail was all Opposite Ends of the Spectrum FIGURE 3we had and nobody had a voice. Man, that was so According to our survey, the largest organizations WHY PEOPLE PARTICIPATE INfantastic. Let’s please go back there.’”6 (those with over 100,000 employees) and the smallest SOCIAL MEDIA In practice, the term social business is used to refer organizations (those with fewer than 1,000 employees) The main reasons people participateto either activities, a phenomenon or trend, or a type tend to appreciate the value of social business today in social media atof organization.7 Jeff Schick, IBM’s vice president of more than midsized organizations. (See Figure 4.) work are to network, work more effec-social software, describes his company as a social Gerald Kane, an assistant professor at Boston tively and voicebusiness: “I see IBM as a social business because of College who studies the strategic use of information their opinions.how we’ve broken down the barriers of reaching out Fig. 3to the people within the organization, but also how Composite Score *we’re leveraging these same tools externally facing, to Network with others in the organization 4,634interact with our partners and clients.” Work more effectively 3,181 Using the term “social” in conjunction with “busi- Voice opinions 3,151ness” can elicit a mix of reactions. Critics observe that Feel more connected to the organization 2,385every organization is already social in some way, so it *  ote: Survey respon- N Improve personal reputation 1,895 dents were asked to rankis not clear what the new term adds. Another objec- their top three selections. Develop skills 1,687 To determine an overalltion is that “social” activities are seen as unproductive. ranking, a composite Meet formal performance goals 604On the other hand, advocates have embraced the score was computed by Earn monetary awards 210 assigning a higherterm, asserting that social business fulfills the basic weight to a higher rank and a lower weight to ahuman need to connect with others.8 lower rank. SOCIAL BUSINESS: WHAT ARE COMPANIES REALLY DOING? • MIT SLOAN MANAGEMENT REVIEW 7
  • 10. R E S E A R C H R E P O R T S O C I A L B U S I N E S S : W H AT A R E C O M PA N I E S R E A L LY D O I N G ? technology to create business value, says this is not happy. It turns out that she writes a blog that’s surprising. “I think smaller firms like social business read by about 50,000 people each month, and because they don’t have the buying power or the re- she wrote a post saying, “Hey, McDonald’s, I’m sources to conduct traditional media campaigns. loving it.” She’s turned into a huge advocate for They can use social media to increase their voice us. I see her all the time on Twitter, talking about and connect with customers to really make them- McDonald’s and even defending us against crit- selves seem bigger than they are.” ics. We changed this person from a customer He notes that very large, resource-rich organiza- with a complaint to a huge advocate, all by tions can afford to experiment with trendy doing this one little thing on Twitter. We under- technologies like social media. “It can make them stand the power of making one customer happy. seem smaller, more intimate than they are, less the big corporate monolith than a collection of people Industry Spotlight: who really care about their products and customers.” Media and Tech As an example, Kane cited Coca-Cola’s official Based on our survey data, respondents in the enter- historian, who is charged with supporting nostalgia tainment, media and publishing along with the IT collectors. “Midsize companies can’t afford to have and technology industries tend to see the most a position like that on staff. He’s using blogs and value from social business. (See Figure 2.) Facebook to do a Coca-Cola memorabilia / history As might be expected, culture seems to play a focus.” Kane believes that midsize companies, for role. Managers from these sectors see their compa- whom traditional media and traditional technolo- nies as both more open to new ideas and innovative gies are working just fine, may be skeptical of at higher rates than respondents in other industries. moving into new frontiers. (See Figure 5.) Fully 88% of managers in what we McDonald’s is one of the most widely recognized are calling the Media industries believe their com- brands in the world, with more than 2 million online panies are open to new ideas, and 68% consider mentions a month, according to Rick Wion, director of themselves innovative. For the Tech industries, the social media for McDonald’s. Wion explains how his numbers were 77% and 69% respectively, both company is able to engage with customers in a way that higher than the average in other industries. makes his company seem small and responsive: Media and Tech share other distinctive prac- tices. Managers in these industries are more likely We received a tweet one day from a mom who to say their companies are consistently creating or said, “Hey, McDonald’s, do you know what it introducing new social business initiatives with does to a little boy to get The Littlest Pet Shop customers and suppliers than do managers in when he wanted a Wolverine toy?” The mom other industries. Moreover, they are much more had ordered a Happy Meal for her four-year-old likely to incorporate social data into their ERP sys- son, but instead of getting the boy’s toy, he got the tems than other industries (though no industry girl’s toy. The boy was upset, which created a scores high on this measure). A senior operations major headache for her. In response to her tweet, executive at a large entertainment company de- we mailed her a boy’s toy, and she was super scribes how social business is changing the way Fig. 4 work is done at his company. 21.2% 21.2% A Large Media Company10 The company’s staff uses Chatter, a social enterprise platform from 13.6% 13.6% 12.1% Under 1,000- 5,000- 10,000- Over FIGURE 4 THE IMPORTANCE OF SOCIAL SOFTWARE 1,000 5,000 10,000 100,000 100,000 BY COMPANY SIZE Size matters: the smallest and largest companies Number of employees in organization perceive more value from social software.8 MIT SLOAN MANAGEMENT REVIEW • DELOITTE
  • 11. Open to new ideas InnovativeSalesforce.com, to help fill 2 million advertisingspots per year across 15 television properties. Before Entertainment, mediathey began using Chatter, employees described the and publishing managerscoordination between the sales and marketingteams as “disjointed.” Salespeople did not have a 88% 68%clear understanding about the availability of slotsthey could offer to advertising customers. As the company’s staff started using the socialenterprise platform, coordination between market-ing and sales dramatically improved. Account IT and Technologyexecutives from any of the company’s properties industry managerscould use the Chatter platform to view advertisersand advertising slots at other business units and 77% 69%then interact with their counterparts in these busi-ness units to fill gaps in their own advertisingportfolios. One manager cited a 300% jump in re-turn on investment just a few weeks after his groupstarted using the internal collaboration platform. less value on social business. After all, CFOs tend to FIGURE 5 INDUSTRIES Another value that comes from the media com- focus on investment returns, and our respondents WITH OPENpany’s improved coordination emerged in 2011, tend not to measure the ROI of social software use. AND INNOVATIVE CULTURESwhen a cruise ship sank off the coast of Italy. One of That CIOs perceived so much less value than CEOs, Media and tech-the company’s executives received an e-mail about presidents and managing directors did, on the other nology industries tend to have morethe disaster the next morning when he was still in hand, was more surprising. Gerald Kane explains open and innova-bed, and he quickly realized that the company had a CIOs’ relative lack of interest in social business: tive cultures relative to otherlot of ad spots that day from cruise advertisers. industries.Through Chatter, he was able to pull the ads because CIOs can be terrified of social for a number ofhe believed it wouldn’t benefit anybody to be adver- reasons. In many cases, social wasn’t their idea.tising cruises that day. In addition, employees are going to use it any- Two hours later, the owners of the cruise ship ads way, because they can use smart phones orrequested that the media company pull the adver- laptops offline to circumvent all of the blockingtising. The executive was able to say, “Don’t worry, of the sites that happens in most organizations.guys, I already pulled them for you.” The executive Another reason is that this is a data securitysaid that his team’s level of coordination and speed nightmare. In the previous generation of IT, likeof response would have been difficult to achieve ERP systems, IT was a very controlled environ-without using the social platform. ment. Social is the opposite.The View from the C-Level Kane’s assessment has quantitative research sup-C-level executives vary considerably in their per- port. In 2010, Gartner surveyed 757 non-ITceptions about the value of social business to their professionals in Germany and the U.S. and foundorganizations today. (See Figure 6.) On average, that 15%-30% of this group used unofficial socialacross all industries, CEOs, presidents, managing software for work purposes, “even in enterprisesdirectors, board members and CMOs are most with an official tool in that category. For example,likely to perceive social business as important today. 21% of respondents use mostly unofficial wiki toolsIndeed, CEOs are twice as likely as CFOs and nearly in enterprises that have official wiki tools.”11twice as likely as CIOs to view social tools as impor- Social business may occupy a “blind spot” for sometant right now. CIOs. Keri Pearlson, an entrepreneur, consultant and It is not altogether surprising that CFOs place adjunct professor at Babson College, suggests: SOCIAL BUSINESS: WHAT ARE COMPANIES REALLY DOING? • MIT SLOAN MANAGEMENT REVIEW 9
  • 12. Fig. 6 R E S E A R C H R E P O R T S O C I A L B U S I N E S S : W H AT A R E C O M PA N I E S R E A L LY D O I N G ? 28% 29% over the next two years. (See Figure 8.) The top two business challenges that could be addressed by so- cial software were managing customer relationships 17% 14% 15% and innovating for competitive differentiation. The importance of marketing and innovation to an organization is difficult to overstate. According CEO / CFO / CIO / Other C-level Other C-level to management theorist Peter Drucker, “Because it President / Treasurer / Technology executive executive Managing director Comptroller director focused on or equivalent is its purpose to create a customer, business has two social media — and only two — functions: marketing and inno- vation. Marketing and innovation create value; all the rest are costs.”12FIGURE 6 CIOs tend to be either strategists or keep-the- But marketing and innovation are just the startTHE IMPORTANCEOF SOCIAL lights on kind of executives. The strategist CIO of the value story for social business. In our inter-BUSINESS TO may be preoccupied with large-scale, enter- views with thought leaders and executives, we alsoTHE C-SUITECEOs, presidents prisewide kinds of issues, and few companies found that operations and leadership are benefitingand managing have articulated a vision for how they want to from social tools. These four areas — marketing, in-directors saysocial business use social business corporatewide. The keep- novation, operations and leadership — are whereis important to the-lights-on CIO may not see a value in social social business is creating significant opportunitytheir organiza-tions at twice the business because it is difficult to immediately and, for some companies, significant value.13 Usingrate of CFOs and see how it will reduce the cost of operations. It’s social tools for marketing is not the be-all or end-allnearly twice therate of CIOs. just not a priority for them. That said, many of social business: it is a component of the overall CIOs do understand that social business is value that social business can deliver. coming and they will have to deal with it. Marketing Despite their differences regarding its importance Organizations are using social software, social media today, 70% of CEOs, presidents, managing directors and social networking to improve their relationship and CIOs in our survey believe that social business with customers in a number of ways: monitoring on- will be important to their organization in three years. line communities; creating and supporting virtual This suggests that many CIOs regard social business communities; developing new communication as neither a threat nor a passing fad — they may sim- channels; and fostering a wide range of customer en- ply be cautious about jumping in before others gagements, including coupons, contests and other demonstrate its value. (See Figure 7.) sponsored events. With their social business activi- ties, enterprises have been able to enhance their understanding of and engagement with their cus- WHERE’S THE BUSINESS tomers. At the same time, customers, vendors and VALUE? (NOT JUST IN suppliers are clearly willing to engage with business MARKETING) W e asked our respondents how impor- tant they thought social software would be to their organization’s suc- cess in meeting eight specific business challenges 71% 70% FIGURE 7 THE IMPORTANCE OF SOCIAL SOFTWARE IN 3 YEARS CEO / President / CIO / Technology A strong majority of CEOs and CIOs believe social soft- Managing director director ware will be important to their organizations in 3 years.10 MIT SLOAN MANAGEMENT REVIEW • DELOITTE
  • 13. Q3. How important do you think social software will be to your organization’s success in meeting the following challenges over the next two years?in online social forums. In particular, product fan Important Somewhat Neutral Somewhat Unimportant important unimportantsites have proliferated across the Web, increasing the Managing customer relationshipsvisibility of influencers and a core customer base. 42% 38% 12% 5% 3% Innovating for competitive differentiationMcDonald’s In 2010, McDonald’s launched McRib, 38% 36% 14% 7% 5%a limited-time-offer sandwich. It quickly developed Acquiring and retaining employeesa loyal fan base that was “raving about the product 27% 38% 20% 8% 6%in social media,” according to Rick Wion, the com- Growing revenuepany’s director of social media: 26% 35% 20% 10% 9% Responding to new competitive threatsWhen we saw these superfans, we decided to use so- 26% 36% 22% 10% 7%cial media to engage with them. We found three of Reducing costs and increasing efficiencies 21% 28% 25% 16% 10%the biggest McRib fans. One had built the firstFacebook fan page for McRib. Another was an au- Managing risk 11% 22% 31% 21% 14%thor who had written a book chapter about McRib.A third man, from Minnesota, built a Google map Managing regulatory compliance 8% 16% 30% 20% 26%of McRib locations. If you saw the McRib at a res-taurant, you could pin it on a Google map, andother people could see it and know where theycould go and get one. “This traditional innovation paradigm is funda- FIGURE 8 THE IMPORTANCE We used their stories to tell the McRib story mentally flawed,” writes MIT professor Eric von Hippel OF SOCIAL SOFT-through Facebook and Twitter, and connected them and colleagues. “Consumers themselves are a major WARE IN MEETING CHALLENGESwith bloggers so that people heard about these fans. source of product innovations.”14 In many instances, Social softwareWe had them at a media launch event. These cus- social business activity mediates or forges the links be- is perceived to be important to man-tomers were amazing spokespeople. What better tween these consumer innovators and business. Volvo, aging customerway to get people excited about McRib than show- Nike, Lego and Threadless (a Chicago-based cloth- relationships and innovating for com-case three of its biggest fans? ing manufacturer and retailer) are just a few of the petitive advantage. It created not only a huge buzz in the core audi- companies that are using virtual consumer environ-ence for McRib, but it also had a ripple effect. We ments to help improve products.15started to see people saying, “What’s all this buzzabout? I’ve never had McRib before. I’m going to go Lego Group The Danish toy company Lego Grouptry it. I’m going to go buy it.” The buzz of the core plans to launch Minecraft Micro World, a Lego setaudience brought in new customers. This was a based on the wildly popular Minecraft video gamehuge success for us. by Swedish game developer Mojang, in summer 2012.16 As in the video game, Lego fans will be ableInnovation to build landscapes with removable surfaces thatCompanies are using social business activities to shield mines and “hidden resources” and create asource new ideas and refine existing products and physical world that mimics their virtual online play.services. Survey respondents say that innovation will The idea for Minecraft Micro World did notbe the second most important challenge facing their come from a veteran Lego product developer butorganization over the next two years, after managing from an adult Lego fan who submitted his idea tocustomer relationships. Lego through Lego Cuusoo, a website where Lego These new ideas are coming not only from within enthusiasts submit and vote for new product ideas.the company but also from a more engaged group of Within 24 hours of submission, the Minecraftcustomers. This is a relatively new phenomenon, or Micro World idea received 10,000 votes, automati-at least newly recognized. The traditional view has cally kicking the concept up to Lego management.been that producers, and only producers, innovate. The idea received the green light within a month. SOCIAL BUSINESS: WHAT ARE COMPANIES REALLY DOING? • MIT SLOAN MANAGEMENT REVIEW 11
  • 14. R E S E A R C H R E P O R T S O C I A L B U S I N E S S : W H AT A R E C O M PA N I E S R E A L LY D O I N G ? Lego Cuusoo, which was launched to encourage We have found many companies in a range of in- the development of “community-supported” Lego dustries that use social tools to enhance their sets, is only one of many ways that Lego uses social collaboration efforts. Below are examples from the in- tools to create greater intimacy with its consumers. surance, financial services and agriculture industries. When he joined Lego in 2004, CEO Jorgen Vig Knudstorp announced that transparency and col- Nationwide Nationwide Mutual Insurance Com- laboration would be the keys to innovating new pany, a U.S.-based insurer with annual revenues in Lego products. The company drew fans deeply into excess of $20 billion, offers a window into how com- the brand experience by giving them a voice in iden- panies are creating knowledge flows to solve real tifying new product lines and distribution business problems. Last year, a Nationwide customer strategies. To Lego, consumers are far more than was stranded on vacation when his RV broke down. mere purchasers: they are true collaborators with a The customer called the Nationwide call center to see vested interest in ensuring that the company creates if his policy covered the situation. Due to the particu- products that meet their needs. lars of the customer’s circumstance, the call center agent was unsure and posted the case on the compa- Operations ny’s internal collaboration platform. People from From the perspective of operational performance, across the company, from product, claims and un- social business offers value by enabling knowledge derwriting groups, began offering their feedback. to flow within, and into, an organization. MIT’s An- Within 30 minutes, the call center rep had a detailed drew McAfee sometimes cites former Hewlett approach to helping the customer and covering the Packard CEO Lew Platt’s comment, “If only HP repair costs. Without this internal collaboration tool, knew what HP knows, we’d be three times more this particular issue might have taken hours or days productive,” when trying to persuade CEOs of the to resolve; the typical call center software has no abil- value of social business. John Hagel III, co-chair- ity to let people from other parts of the company man of Deloitte’s Center for the Edge, suggests that participate in problem solving. social business can help improve operational per- formance by advancing knowledge flows: Capital One At financial services giant Capital One, teams are using tools like Facebook to facilitate group Increasingly, the ability to succeed hinges on communication. Tom Poole, managing vice presi- participating in a broader and more diverse dent, mobile and social media, at Capital One, says: range of knowledge flows, both internally and externally to the enterprise. Sixty to 70% of People have begun to realize there’s a better headcount time in most functions is consumed model to how we work as teams that is socially by handling exceptions, things that get thrown driven. Instead of a push model, where every- out of automated processes. The employee typi- body is told about everything via the e-mail cally scrambles around, can’t resolve it on his channel, you have more of a pull model, similar own and needs to get a number of other people to an RSS feed. You actually subscribe to the engaged. We need to find those people, find content you want to hear about, and you ways to engage them as a group, get the rele- contribute to the communities you want to vant data. That is a hugely inefficient process contribute to. And the communities accept you today. Social technologies are providing an op- or they don’t. portunity to significantly increase operating There is an incredible opportunity to use performance of a business, and that’s really the channels like Facebook or Chatter to drive this key driver of adoption of social technologies. change. I use Facebook private groups with my This is a generation of technology that can be social media team, and the amount of interac- extremely helpful in terms of scaling participa- tion is twice as much as on any other team. The tion in knowledge flows.17 ability to share articles and insights and industry12 MIT SLOAN MANAGEMENT REVIEW • DELOITTE
  • 15. happenings and to riff back and forth on ideas for portunities, such as air travel and automobile new promotions is off the charts. Because it’s transportation. Levitt’s question, “What business Facebook, it’s connected into our social lives as are you in?” became a clarion call for businesses to well, so it promotes connection throughout the focus on customers, rather than on improving op- day. When you have the idea, you share it and erations for a product or service that, in a changing you’re hearing back an hour later. This is lighten- competitive landscape, may not advance the com- ing in a bottle. I’m optimistic we can make this pany’s long-term prospects. scalable and keep security where it should be. Social business can help avoid marketing myopia in at least two ways. One is to use members of anAlmond Board of California Creating efficiencies online community to identify shifts in customerwith collaboration tools is not restricted to internal preferences. For example, SAP, the enterprise re-efforts. Consider the Almond Board of California, an source planning software provider, has an onlineassociation of over 6,000 almond growers and 104 al- community with more than 2 million members.mond handlers. Richard Waycott, Almond Board of This community annually nominates about 100 ofCalifornia’s CEO and president, says that Huddle, a its members to be SAP mentors, influencers recog-cloud-based collaboration platform, has become “a nized for their subject matter expertise and theirmission-critical part of our market development and willingness to mentor other community members.execution process.” He adds: SAP mentors are expected to mentor SAP itself. They are given extra access to product managers It’s the best way that we have found to develop and can influence product development. As Mark strategic plans and communicate with agency Yolton, senior vice president of SAP communities partners around the world. It allows us to begin and social media, explains, these mentors also men- documents. It allows people to add content to tor SAP’s executive team: those documents. It allows us to create approval checkpoints. It allows us to conduct minimal Hasso Plattner, our co-founder and chairman project management in terms of timelines and of the board, invites mentors to brainstorm with set up deadlines. It’s a very important tool for us him. No PowerPoint, no set agenda. He just gets right now, albeit still a very new one. a bunch of mentors in the room, usually at one of our big events. They give him honest feedbackLeadership from the field about what’s really going on withSocial business activities can make valuable contri- our customers and our partners — and our em-butions to leadership in at least two different areas: ployees as well. Our co-CEOs and a boardstrategic insight and strategic execution. In these member, who is responsible for innovation atareas, social tools can help leaders sharpen their vi- SAP, also meet with the mentors to hear theirsion and extend their reach. feedback. Mentors are people in our community Strategic Insight: Consider the problem of myo- who are very engaged with SAP partners andpia, first popularized by Theodore Levitt in his customers. They have a great deal of influencefamous Harvard Business Review article, “Market- on outside perceptions of SAP, on influencinging Myopia.” 18 Levitt made the point that many our own product direction and on our strategy.companies failed to anticipate changes to their busi-ness landscape and lost their way as the demand Another way that social business can help compa-characteristics of their products and services nies avoid marketing myopia is through sentimentchanged. As the transportation industry was revo- analysis — for example, analyzing Twitter streams orlutionized by new services, railroad executives activity in online communities — to anticipate shiftscontinued to see themselves in the railroad indus- in the competitive landscape. “Before, you mighttry, rather than the transportation industry. They hear problems with the brand or product through asubsequently failed to take advantage of new op- 1-800 number or complaints or warranty issues,” says SOCIAL BUSINESS: WHAT ARE COMPANIES REALLY DOING? • MIT SLOAN MANAGEMENT REVIEW 13
  • 16. R E S E A R C H R E P O R T S O C I A L B U S I N E S S : W H AT A R E C O M PA N I E S R E A L LY D O I N G ? Donna Hoffman, professor at the University of Cali- Strategic Execution: Social business activities fornia, Riverside and co-director of its Sloan Center also offer a way to extend the reach of organizations, for Internet Retailing. “Now it is coming from the including that of their leadership. A business-to- product development function or from listening to business company with a strategy to reach the end what is happening online.” user in order to build product demand can use social New technologies are enhancing organizations’ tools to engage directly with the consumer. In corpo- ability to listen to and analyze what is happening rations with a franchisee network, social tools can be online. New software technologies can make sense used to effect change in front-line behaviors, even of massive amounts of streaming data from Twitter when these front-line employees do not work directly or Facebook and provide insights about real-time for the organization. Social business can advance a consumer trends. The applications of these tech- leader’s strategic agenda in a number of ways. nologies, however, transcend analyzing word frequency patterns. Luminoso, a text-understand- Cara Group Natasha Nelson is vice president of ing company, offers a glimpse into a future in which business intelligence at Cara Operations, a Canadian computers make sense of the meaning behind nat- restaurant chain with five brands and 700 franchi- ural language. (One caveat: The future is already sees. When Nelson joined Cara, the CEO asked her to here — Luminoso is currently generating revenues engage the company’s associates to improve service from its service.) delivery on the front lines. The problem was that the associates worked for the franchisees, not corporate. Luminoso Catherine Havasi is co-founder and Many associates were young, worked part-time, and CEO of Luminoso and a research scientist at the for some, this was their first job. There was a high de- MIT Media Lab. Luminoso works with organiza- gree of turnover. Yet this group was an important tions in a variety of industries, including consumer factor in determining the quality of the customer ex- goods, financial services, pharmaceuticals, media perience. How could Cara engage this group in a way and information technology. Luminoso’s technol- that was simple and easy, and use that engagement to ogy has intriguing applications for the health care improve front-line service? sector as well. In one case, Luminoso analyzed a da- Nelson researched the problem and found little taset of very brief (tweet-length) patient reviews assistance. An article from one of the leading tech- about visits with their doctors. Havasi explains the nology research firms advised against using Facebook value her company can provide: to engage with employees. She explored using a por- tal technology platform, but could not find a way to Suppose a person responded to their doctor drive associates to use it since they were not typical visit by saying: “He showed me my CAT scan, information workers. Eventually, Nelson’s IT depart- which was good; but he didn’t answer all of my ment partnered with HR and marketing to develop a questions.” Our system was able to discern that strategy built upon a Facebook application: that person was not entirely happy with the visit despite their use of the word “good,” and The associates all have it on their mobile de- that the patient felt “rushed.” It turns out that vices, and go onto Facebook anyway every day. patient satisfaction depends on knowing that That’s how they communicate, that’s how they your doctor is intelligent, able to explain him- stay in touch. So we decided to use a platform self well and responds to your questions. The that they already are on and that they know and ability to analyze not just what is said, but love. We launched this very, very slowly, starting what survey respondents actually meant, has at 12 locations of one of our more upscale big implications when you consider that the brands, Milestones. We launched an application reimbursement system for government-cov- on Facebook, called the Staff Room, where we ered health care will be determined, in part, by encouraged the associates to share stories about patient satisfaction and quality of care. restaurant service and tips about managing14 MIT SLOAN MANAGEMENT REVIEW • DELOITTE
  • 17. Fig 9FIGURE 9 THE FACTORS LEADING TO ADOPTION Composite Score*OF SOCIAL SOFTWARE Clear vision of how social media supports 5,146Adopting social software requires clear vision business strategyand strong leadership. Senior management support 3,979 Good fit with organization’s culture 2,563 their jobs. We are trying to encourage a hospi- Employee enthusiasm 2,067 tality gene, qualities that everyone should aspire Employees predisposed to using social 1,950 software to, like love serving people. Well-orchestrated rollout of social business 1,752 From this pilot we decided to make the Staff initiatives via social software Room into a peer-to-peer recognition platform, Well-understood rules of the road for 1,474 participating because the center point of our strategy is guest experience. We’ll celebrate associate stories con- Attractive informal incentives for 934 participation (e.g., peer recognition or *  ote: Survey respon- N improved reputation) dents were asked to nected with the hospitality gene. More rank their top three se- importantly, we’ll let staff recognize one an- Attractive formal incentives for 515 lections. To determine participation (e.g., higher performance an overall ranking, a other. Because their friends and family are also rating, monetary awards) composite score was computed by assign- on their Facebook page, they’ll be recognized by Mandated participation 488 ing a higher weight to them too. We believe that this will be very pow- a higher rank and a Fig. 10 lower weight to a erful. People will share stories of how they’ve lower rank. improved the guest experience; and their peers, Composite Score * friends and family will recognize them. Lack of management understanding 3,050 No strong business case or proven value 2,314 propositionCONNECTING LEADERSHIP Too many competing priorities 2,087AND CULTURE Fear of lack of control 1,885 Security concerns (e.g., intellectual 1,600I n order to create value with social business, property leakage) some companies must address difficult organi- Lack of senior management sponsorship 1,532 zational issues that arise with leadership and Fear of employee abuse (e.g., wasting time) 1,349culture. According to Charlene Li, “The biggest de- Lack of a knowledge sharing culture 1,306terminants, by far, of whether you will be successful Lack of a robust strategy 1,276at social business are leadership and culture.” Fear of challenging established norms 1,226 and practicesVision and Strong Lack of implementation skills 845Management Support Employee mistrust or resistance 824Our research suggests that leadership is critical to in- Lack of policies or governance processes 584creasing the use of social tools within an organization. Lack of incentives 386(See Figure 9.) We asked, “What factors do you seefacilitating the adoption of social software in your or-ganization?” The top two answers were clear vision adoption? Our findings suggest that an important FIGURE 10 THE OBSTACLESfor how social media supports business strategy, and resource is missing — measured results for social IMPEDING THEsenior management support. Lack of management software. In our survey, the most frequently cited ADOPTION OF SOCIAL SOFTWAREunderstanding was the top answer to the question, type of measurement of social software use is Do not The top barriers“What internal barriers do you see impeding the measure. (See Figure 11.) Lack of business case was to social software adoption are lackadoption of social software in your organization?” the second most-cited internal barrier to adoption. of management(See Figure 10.) (Risk and security concerns are the Without measured results, it can be difficult to cre- understanding, no strong businesstop external barriers to social software adoption.) ate effective incentive structures or monitor the case and too many But do leaders have the tools they need to drive progress of pilot initiatives. competing priorities. SOCIAL BUSINESS: WHAT ARE COMPANIES REALLY DOING? • MIT SLOAN MANAGEMENT REVIEW 15
  • 18. R E S E A R C H R E P O R T S O C I A L B U S I N E S S : W H AT A R E C O M PA N I E S R E A L LY D O I N G ? Do your leaders have the right mindset for inte- in corporate cultures where what you know is an im- grating social business into your organization? MIT’s portant source of your power in the organization. Andrew McAfee notes that someone’s receptivity to Transitioning to a culture in which sharing knowl- social business has a lot to do with his or her qualities edge is a source of power can threaten a nonsocial as a leader. For those who encourage the free exchange feature of human nature — self-protection. We asked of ideas, there’s no conflict. But for those who prefer to several thought leaders what they believed about the suppress opinions, social business can be seen a threat: challenge of making this organizational transition. Marshall Van Alstyne, an associate professor of Social business can undermine people’s power. information systems at Boston University, suggests Especially if you’re a jerk boss who has thrived that one way to promote a cultural shift toward so- on being the gatekeeper for information and cial business is to ensure that people have incentives suppressing your people’s opinions, this could be to share rather than hoard information: unpleasant for you. If you’re the boss of a project that’s behind schedule and you try to convince Think of it in terms of information scarcity ver- your higher-ups that it’s on schedule, these new sus information abundance. If information is social tools will be uncomfortable for you. For scarce, then you, as the control point for access what I would call high-quality or more enlight- to that information, have a lot of power. If in- ened leaders, there is no conflict here. For formation is abundant and it’s easy to go command-and-control bureaucrats who are around you, you can benefit by being the first to afraid of having a more multivoiced organiza- provide that information. In a rich social busi- tion, this stuff is scary. But I don’t want a lot of ness environment, information is abundant, so those managers in my organization. you have an incentive to share information you have, or someone else will and you lose out. Having the right leadership mindset — being Even if it’s not quite as good, you can provide it open to new ideas and encouraging others to share a lot earlier and in such abundance that other rather than hold onto information — is an impor- folks are still happy to have it. tant determinant of whether social business will Consider SAP’s developer ecosystem where gain traction in your organization. developers can answer each others’ questions.FIGURE 11 Before this system, a value-added reseller on topMEASURING THEEFFECTIVENESS OF Sharing Knowledge of SAP’s software had no particular reason toSOCIAL BUSINESS As mentioned earlier, companies that are already de- help out another value-added reseller. As a mat-INITIATIVESFew companies are riving value from social business have cultures that ter of fact, one might not want to answer themeasuring the effec- tend to be more open to new ideas and more collab- question of another reseller because it might ac-tiveness or successof their social busi- orative than other companies. For other companies, tually help them out and make them moreness initiatives. sharing information may not come easily, especially competitive. But after the introduction of this question-and-answer marketplace, thingsFig. 11 shifted completely. Now you earn points in pro- Composite Score* portion to the value of your answers. Now the Do not measure 4,721 value-added resellers are telling their employees to go in and answer the questions of other resell- Number of employees signed up / registered 1,698 ers to prove, “Hey, we’re the ones with the Number of employees posting 1,633 *  ote: Survey respon- N expertise, not those guys.” It’s completely shifted Total number of posts 1,402 dents were asked to rank their top three selections. the incentives. Folks are now pushing their in- Other metrics external to social business 1,207 (e.g., increase in sales, reduction in To determine an overall formation into the marketplace in a way that customer complaints) ranking, a composite score was computed by benefits SAP. It’s a really clever mechanism that Employee satisfaction metrics 1,029 assigning a higher weight to a higher rank completely inverts the incentives from one of Number of topics 824 and a lower weight to a hoarding to one of information sharing. lower rank.16 MIT SLOAN MANAGEMENT REVIEW • DELOITTE
  • 19. Other Requirements best supports these objectives? What kinds of socialAs these observations suggest, social business, consid- networks will support this strategy? Recognize thatered as a group of activities, can be challenging or even your social business journey will take time and thatthreatening to the status quo. Meeting one organiza- it will require and drive changes to your businesstional requirement like leadership is not sufficient for processes, your organizational structure and howan effective social business engagement or for an effec- you interact with customers and employees.tive execution of an enterprise-level social businessstrategy. “Social initiatives within an organization Assess Where You Are Todayneed champions to support and grow these initiatives,” Identify problems that are currently being addressedsays Gerald Kane, an assistant professor at Boston Col- with social tools. Explore whether the right social busi-lege, “but champions and strategies alone will not ness resources are being directed toward the rightpush the organization forward.” In addition to leader- business problems. If your organization is in a heavilyship and culture, other factors include social tools that regulated industry, are your regulatory affairs person-are simple to use, properly structured incentive sys- nel talking about social business? What coordinationtems, a clear purpose for what problems the social exists between those who are most invested in socialinitiative is intended to solve and clear direction about business activities and those who know how regula-how to communicate with social tools, both inside and tions address social business issues? Make sure yououtside the organization.19 have a governance process in place to address these and similar questions as part of your initial social strategy. Identify the people or roles that will focus on so-PUTTING SOCIAL BUSINESS cial business and how these individuals are toINTO ACTION coordinate with one another. What, if any, relation- ship exists between your CMO and CIO aroundW e have discussed some of the many op- social business? Individuals in both roles should portunities and challenges associated have a shared understanding of the risks and oppor- with social business activity. In this tunities of social business.final section, we offer some practical and prescrip- Use listening tools to collect information ontive guidance on how to begin (or accelerate) your what is being said about your organization, yoursocial journey. It’s essential to develop a long-term brands, your customer service and your competi-vision about how your social business activities will tion. Our research indicates that only a smallconnect with the realities of your organization. Be- percentage of organizations have begun to connectyond just buying social tools, the organization must external social data into existing enterprise systemscommit resources (people and funding) to support and data. We see this as an area that holds tremen-their adoption. Integrating external data sources dous potential value for organizations.into enterprise systems and tackling the challengeof measuring results will also be critical to the long- Support Adoptionterm results of many social business strategies. Ensure that social business initiatives have enough resources. It is not uncommon for organizations toStart with a Long-Term Vision  allocate funds for social software tools and then ne-A “clear vision of how social media supports busi- glect or underfund the adoption components. Is anness strategy” was the top facilitator of adoption in individual assigned responsibility for this effort, orour survey. Therefore, we believe the first step in is this an additional duty on top of someone’s cur-your social business journey is to create and com- rent job? Are the right incentives targeting the rightmunicate the broader social strategy for your people? Are resources allocated for activities suchorganization. What business problems are to be as user training, communications, content build-solved with social business activities? What is the ing and community management? Is trainingstrategy for making this happen? What technology available to distinguish personal and professional SOCIAL BUSINESS: WHAT ARE COMPANIES REALLY DOING? • MIT SLOAN MANAGEMENT REVIEW 17
  • 20. R E S E A R C H R E P O R T S O C I A L B U S I N E S S : W H AT A R E C O M PA N I E S R E A L LY D O I N G ? uses of social networks? Are sufficient resources in for prime time. If that’s your approach to social place to respond to brand issues that might develop business, you may be overestimating the amount of in social channels? effort it takes to start putting this trend to work for your organization today.”21 Measure Results, Not Adoption REFERENCES It is clear from our survey (and many other research efforts) that enterprises are having difficulties mea- 1. As used in this document, “Deloitte” means Deloitte Consulting LLP and Deloitte Services LP, which are sepa- suring the relationship between investments in rate subsidiaries of Deloitte LLP. Please see www. social business and returns from these investments. deloitte.com/us/about for a detailed description of the Capital One’s Tom Poole echoes what we’ve heard legal structure of Deloitte LLP and its subsidiaries. Certain services may not be available to attest clients under the from a number of executives: “We try not to hold rules and regulations of public accounting. ourselves to a pure constraint of measurable gains. I 2. Source: MIT Sloan Management Review interview with think we still believe we’re in an experimentation David Sacks, CEO of Yammer, February 24, 2012. phase and trying to learn.” 3. Social media is how people get together virtually to Measurement may become increasingly impor- accomplish outcomes. Social software is the set of tools that gives people in a social network the means for auto- tant, especially if these activities require rethinking mation, virtualization, scale and abstraction. Social and redesigning practices, processes, measurement networks are formal descriptions of groups of people who systems and information systems in significant ways. congregate in a social medium. Although a consensus has yet to emerge on measur- 4. Not all social business activities will produce mutually useful connections between individuals. In some cases, it ing social business activities, managers have several may be beneficial to diminish certain connections between options. One is to conduct experiments that compare staff or with some customers. Further, the use of emergent the performance of groups that are heavy and light communication and collaboration tools like Yammer may one day become part of the baseline. When that happens, users of social software and social networking. using these tools may cease to qualify as a social business Measuring adoption can be a misleading indi- activity as we’re defining it, not because they are any less cator of value. In fact, focusing on adoption as a social but because they no longer “amplify” connections. success metric may lead to failure, according to the 5. D.M. Smith et al., “Predicts 2010: Social Software Is an Enterprise Reality,” Gartner, December 3, 2009. Deloitte study “Social Software for Business Per- 6. A. McAfee, “What Sells CEOs on Social Networking,” formance,” since adoption metrics do not address MIT Sloan Management Review, Spring, 2012, what matters most to employees, managers and http://sloanreview.mit.edu/feature/what-sells-ceos-on- executives.20 For managers, what matters most is social-networking/ often whether the tool helps them do their jobs 7. Other uses of “social business” might refer to organiza- tions or to economic systems that promote some notion more effectively. of social welfare. For an example of the latter, see M. Yunus, “Building Social Business: The New Kind of Capi- talism That Serves Humanity’s Most Pressing Needs” (New York: Public Affairs, 2010). SUMMARY 8. See F. Gossieaux and E. Moran, “The Hyper-Social Or- ganization: Eclipse Your Competition by Leveraging Social G iven that social business is still just getting Media” (New York: McGraw Hill, 2010); and A.J. Bradley started, you may be tempted to wait until and M. McDonald, “The Social Organization: How to Use Social Media to Tap the Collective Genius of Your Custom- the technology matures or there is more ers and Employees” (Cambridge: Harvard Business evidence to support its business value. But that ap- Review Press, 2011). proach may delay achieving its potential in your 9. E. Deci and R. Ryan, “Intrinsic Motivation and Self-Deter- organization, to the detriment of your marketing, mination in Human Behavior” (New York: Plenum, 1985). innovation, leadership and operations. According 10. This example comes from an interview with Fergus Griffin, senior vice president for solutions marketing at to MIT professor Alex “Sandy” Pentland, “Like any Salesforce.com. Additional detail was sourced from: emerging technology trend, social business can http://www.youtube.com/watch?v=kTOL6gUgoJQ. seem perpetually just out of reach. Let’s wait a year, 11. G. Tay, “Ask Five Questions to Determine Whether to the thinking goes. It’s not quite real, not quite ready Deploy Social Software Bottom-Up or Top-Down,” Gart-18 MIT SLOAN MANAGEMENT REVIEW • DELOITTE
  • 21. ner Research, January 20, 2011, http://www.gartner.com. 19. Providing clear guidance about communications exter-12. P.F. Drucker, “The Practice of Management” (New nal to a business can be tricky, especially in regulatedYork: Harper & Brothers, 1954), 37. industries like health care and financial services. Too much guidance can put a damper on social business activities. “If13. Of course, social business activities can be valuable in I ask an organization for their social media policy, and I getmany ways. It is our belief that social business activities in back a 50-page document,” says MIT’s Andrew McAfee,these four areas have the potential to generate substantial “that might as well just say, we’d prefer it if you don’t usevalue. social media.” Even in unregulated industries, too much14. E. von Hippel, S. Ogawa and J.P.J. de Jong, “The Age oversight can cast a shadow on innocent interactions. Bab-of the Consumer-Innovator,” MIT Sloan Management Re- son College’s Keri Pearlson describes a recent meetingview 53, no. 1 (fall 2011): 27-35. with a colleague and two representatives from a large tech- nology firm. Her colleague tweeted that she and Pearlson15. S. Nambisan and P. Nambisan, “How to Profit from a were at a lunch meeting, naming the firm but not the indi-Better ‘Virtual Customer Environment’,” MIT Sloan Man- viduals. When the representatives returned to work, theagement Review (spring 2008): 53-59. For an analysis of office was buzzing about who was speaking without autho-Threadless and social media, see D. Hinchcliffe and P. Kim, rization about the company. Staff had been monitoring“Social Business by Design: Transformative Social Media information flows from Twitter about the company and hadStrategies” (San Francisco: John Wiley and Sons, 2012). seen the tweet from Pearlson’s colleague.16. This example is based on Y.M. Antorini, A.M. Muñiz, 20. M. Miller, A. Marks and M. DeCoulode, “Social Soft-Jr. and T. Askildsen, “Collaborating With Customer Com- ware for Business Performance: The Missing Link inmunities: Lessons From the Lego Group,” MIT Sloan Social Software — Measurable Business Performance Im-Management Review 53, no. 3 (spring 2012): 73-79. provements,” Deloitte Center for the Edge, 2011.17. J. Hagel, “Pull Platforms for Performance,” February 21. M. White and B. Briggs, “Tech Trends 2012: Elevate IT20, 2012, http://edgeperspectives.typepad.com. for Digital Business,” Deloitte, 2012: 5.18. T. Levitt, “Marketing Myopia,” Harvard Business Re-view, September/October 1975. SOCIAL BUSINESS: WHAT ARE COMPANIES REALLY DOING? • MIT SLOAN MANAGEMENT REVIEW 19
  • 22. R E S E A R C H R E P O R T S O C I A L B U S I N E S S : W H AT A R E C O M PA N I E S R E A L LY D O I N G ?THE SURVEY:Questions andResponsesResults from the 2012 Social Business Global Executive Survey Q1: To what extent do you agree that each of the following accurately describes your organization? Strongly Agree Neither disagree Disagree Strongly Q1  o what extent do T agree nor agree disagree you agree that each Open to new ideas of the following ac- 26% 45% 18% 9% 3% curately describes Collaborative your organization? 24% 45% 20% 9% 2% Hierarchical 20% 38% 15% 16% 11% Innovative 19% 38% 26% 14% 3% *  ote: Survey respon- N Risk averse dents were asked to rank 16% 32% 29% 18% 5% their top three selections. To determine an overall ranking, a composite score was computed by assigning a higherQ2.Q2  are the primary challenges facing your facing your organization over the next 2 years? What hat are the primary challenges organization over the next 2 years? W weight to a higher rank(Please indicate the top 3 in order of significance) and a lower weight to a lower rank. Composite Score*Growing revenue 5,142 Q3. How important do you think social software will be to your organization’sInnovating for competitive differentiation 4,112 success in meeting the following challenges over the next two years?Reducing costs and increasing efficiencies 3,384 Important Somewhat Neutral Somewhat Unimportant important unimportantManaging customer relationships 2,412 Managing customer relationshipsResponding to new competitive threats 1,950 42% 38% 12% 5% 3%Acquiring and retaining employees 1,807 Innovating for competitive differentiationManaging risk 1,132 38% 36% 14% 7% 5%Managing regulatory compliance 928 Acquiring and retaining employees 27% 38% 20% 8% 6% Growing revenue 26% 35% 20% 10% 9% Responding to new competitive threats Q3  ow important do you H 26% 36% 22% 10% 7% think social software Reducing costs and increasing efficiencies will be to your organi- 21% 28% 25% 16% 10% zation’s success in Managing risk meeting the following 11% 22% 31% 21% 14% challenges over the next two years? Managing regulatory compliance 8% 16% 30% 20% 26%20 MIT SLOAN MANAGEMENT REVIEW • DELOITTE
  • 23. Q4  hich of the following best describes W Q5  hich of the following best describes W your own use of social software for About the your own use of social software to complete daily tasks for your job?Q4. Which of the following best describes your own use of social personal purposes? Q5. Which of the following best describes your own use Researchsoftware to complete daily tasks for your job? (Choose one) of social software ? (Choose one) To understand the I monitor other people’s I monitor other people’s posts and posts about once a challenges and oppor- occasionally contribute myself week and occasionally tunities associated I monitor social I’m not aware of contribute myself I monitor other software frequently with the use of social the organization’s I monitor social people’s posts 34% and contribute at business, MIT Sloan social software software frequently occasionally but I and contribute at 23% least once a week Management Review, 24% never contribute 14% 6% 19% least once a week in collaboration with I’m not allowed myself 10% 19% Deloitte, conducted a to use social 11% I monitor social business tools 18% I never use survey of nearly 3,500 11% I monitor other social software software consistently business executives, 12% people’s posts and contribute daily I monitor managers and analysts social software occasionally but I never contribute from organizations lo- consistently and I never contribute daily use social myself cated around the world. software Q6. What devices do you use to access social software? The survey captured in- (Please rank top 3 in order of significance) sights from individuals in 115 countries and 24 Composite Score * industries and involved Work computer 5,998 organizations of vari- Q6  hat devices do W you use to access Home computer 5,625 ous sizes. The sample was drawn from a social software? Smart phone, personal 3,169 number of different (Please rank top sources, including MIT Tablet, personal 1,537 3 in order of alumni and MIT Sloan significance.) Smart phone, provided by work 1,398 Management Re- view subscribers, Tablet, provided by work 370 Deloitte Dbriefs sub- Other 352 scribers and other interested parties. Don’t access social business applications 253 In addition to these survey results, we interviewed executives, academic experts and Q6A  ow has mobile technology H Q8  ow important are social software to your H subject matter experts affected your use of social organization’s activities in the following from a number of indus- software for personal and externally facing areas? tries and disciplines to Q6A. How has mobile technology affected your use business use? Q8. How important is social software to your organizations activities in the following understand the practical externally facing areas? of social software for personal and business use? issues facing organiza- My mobile access to Important Somewhat important Neutral Somewhat unimportant Unimportant tions today. Their My mobile access to insights contributed social software has Marketing / Branding / Reputation management social software has to a richer understand- not increased my 46% 33% 11% 6% 5% increased my overall overall participation ing of the data and to social media Customer service / Audience engagement in social media the development of participation 33% 34% 17% 9% 7% 49% Innovation (Knowledge Sharing, Product / Service Development) recommendations that 28% 32% 33% 19% 9% 8% respond to the kinds of Mobile is Mobile is now the New / prospective talent management (Onboarding and Training, Recruiting) strategic and tactical now the main main way I access 25% 36% 20% 10% 9% questions senior execu- way I access 5% 18% social software and Employee engagement with external parties tives address as they social software my social media and my social media participation has 19% 35% 24% 13% 10% operationalize social participation has remained the same Supplier / Partner engagement business within their decreased or increased 14% 26% 29% 16% 15% organizations. We also drew upon a number of case studies to fur- Q7. How important do you consider social software to be to your organization? ther illustrate how organizations are lever- Important Somewhat Neutral Somewhat Unimportant important unimportant aging social business and illuminate how Q7  ow important H Today real organizations do you consider 18% 34% 22% 14% 12% are putting our recom- social software mendations into action One year from today in different organiza- to be to your 40% 35% 13% 8% 4% tional settings. organization? Three years from today 63% 23% 8% 4% 3%  SOCIAL BUSINESS: WHAT ARE COMPANIES REALLY DOING? • MIT SLOAN MANAGEMENT REVIEW 21
  • 24. R E S E A R C H R E P O R T S O C I A L B U S I N E S S : W H AT A R E C O M PA N I E S R E A L LY D O I N G ? Q9. How important is social software to your organizations activities in the following internally oriented areas? Important Somewhat Neutral Somewhat Unimportant important unimportant Q9  ow important is social H software to your organi- Discover emerging opportunities zation’s activities in the 26% 32% 20% 10% 12% following internally ori- Facilitate cross-boundary collaboration ented areas? 25% 31% 20% 11% 14% Harness distributed knowledge 24% 32% 21% 10% 13% Increase employee engagement 23% 35% 21% 10% 12% Identify expertise 19% 30% 25% 12% 14% Improve leadership effectiveness through feedback 18% 28% 24% 15% 16% Preserve institutional memory 16% 24% 27% 15% 17% Develop employee skills 15% 29% 27% 14% 15% Q10 How do you find expertise in your organization? (Please check all that apply.)Q10. How do you find expertise in your organization? (Please check all that apply)Use my personal network 85%Tap into a community of interest 39%Rely on supervisor / manager to direct me Q11  ow important are each of the H 33% following for you to do your jobUse internal directory successfully? 32% Q11. How important are each of the following for you to do your job successfully?Use social software to pose a question to an undifferentiated group Important Somewhat Neutral Somewhat Unimportant 22% important unimportant Enterprise document sharing platforms (i.e., tools whose principal function is to let teams store and access documents centrally) 37% 35% 14% 7% 7% Enterprise collaboration tools (i.e., technology that lets colleagues collaborate synchronously or asynchronously via various tools, including discussion threads, brainstorming platforms or wikis) 26% 33% 20% 10% 11% Instant messaging 26% 27% 19% 12% 16% Discussion groups / forums 18% 36% 21% 12% 12% External social software platforms (i.e., the most common social media sites) 18% 30% 22% 13% 18% Listening posts (i.e., a technology platform that listens to what customers and competitors are saying about the organization in social media) 14% 26% 25% 14% 21% Wikis 12% 25% 26% 14% 23% Blogging 11% 23% 25% 16% 24%22 MIT SLOAN MANAGEMENT REVIEW • DELOITTE
  • 25. *  ote: Survey respon- N dents were asked to rank their top three selections. To determine an overall ranking, a composite score was computed by Q12  hat factors do you see facilitating the adoption of social W assigning a higherQ12. What factors do youyour organization? software in see facilitating the adoption of social software in your weight to a higher rankorganization (Please indicate the top 3 in order of significance) and a lower weight to a lower rank. Composite Score*Clear vision of how social media supports 5,146business strategySenior management support 3,979Good fit with organization’s culture 2,563Employee enthusiasm 2,067 Q14  hat external barriers, if any, do you see WEmployees predisposed to using social 1,950 impeding the adoption of social softwaresoftware in your organization? Q14. What external barriers do you see impeding the adoption of social softwareWell-orchestrated rollout of social business 1,752 in your organization? (Please indicate the top 3 in order of significance)initiatives via social software Composite Score*Well-understood rules of the road for 1,474 Risk or security concerns 5,036participating Insufficient customer demand or need 4,035Attractive informal incentives for 934participation (e.g., peer recognition or Legal issues 2,410improved reputation) Concern over regulators’ stance 2,077Attractive formal incentives for 515 towards social mediaparticipation (e.g., higher performancerating, monetary awards) Absence of industry standards 1,728Mandated participation 488 Recessionary economy 1,474 Lack of shareholder support 964 Q13  hat internal barriers, if any, do you see impeding the adoption of WQ13. What internal barriers do you seeorganization? social software in your impeding the adoption of social softwarein your organization? (Please indicate the top 3 in order of significance) Composite Score* Lack of management understanding 3,050 No strong business case or proven value 2,314 proposition Too many competing priorities 2,087 Fear of lack of control 1,885 Security concerns (e.g., intellectual 1,600 property leakage) Lack of senior management sponsorship 1,532 Q14A  ow strongly do you agree H with the following statements? Fear of employee abuse (e.g., wasting time) 1,349 Lack of a knowledge sharing culture 1,306 Q14A. How strongly do you agree with the following statements: Lack of a robust strategy 1,276 Important Somewhat Neutral Somewhat Unimportant important unimportant Fear of challenging established norms 1,226 Social media is a high-priority agenda item and practices for regulators in my industry Lack of implementation skills 845 5% 11% 31% 33% 21% Employee mistrust or resistance 824 Regulators understand the issues and implications of social media in my industry Lack of policies or governance processes 584 4% 13% 33% 33% 17% Lack of incentives 386 Regulators have developed a framework for addressing social media usage in my industry 3% 7% 29% 39% 22% Regulators are beginning to develop a framework for addressing social media usage in my industry 3% 19% 37% 26% 14%  SOCIAL BUSINESS: WHAT ARE COMPANIES REALLY DOING? • MIT SLOAN MANAGEMENT REVIEW 23
  • 26. R E S E A R C H R E P O R T S O C I A L B U S I N E S S : W H AT A R E C O M PA N I E S R E A L LY D O I N G ? Q15. How important is each of the following as a source of new social related initiatives in your organization? Important Somewhat Neutral Somewhat Unimportant important unimportant Senior executive sponsored Q15  ow important is H (leadership drives use of social software and is an authentic user) each of the follow- 31% 31% 19% 8% 10% ing as a source of Intra-team new social-related (helping a small departmental or project-based team complete its task) initiatives? 21% 38% 20% 10% 12% Scaling team initiatives (deploying practices from one team to other teams in the organization) 18% 35% 25% 10% 13% IT-sponsored initiatives (IT rolls out a set of tools and practices to be applied in a variety of situations) 17% 34% 26% 11% 13%Q16. Howow doesorganization support social business initiatives? (Please rank the Q16  does your your organization support social business initiatives? Htop two in order of significance) Composite Score*Staff who formally devote some part 1,903of their time to social businessOrganization tolerates social business, 1,850but assigns no formal budget or peopleto the effortStaff who have been asked by management 1,801 Q19  o what extent do each of the Tto take on social business responsibilitieson top of the rest of their portfolio following functional areas drive the use of social softwareFull-time staff supporting social business, 850centrally located in one group within your organization?Full-time staff supporting social business, 670 Q19. To what extent do each of the following functional areas drive the use of socialbut reporting to different parts of the software within your organization?organization A great deal Somewhat Don’t know Not very much Not at all Marketing Q17  o what extent does your organization T 47% 26% 9% 8% 10% incorporate externally collected data Sales from social software into its business Q17. To what extent does your organization 30% 29% 9% 14% 18% incorporate externally-collected dataenterprise practices and systems (e.g., from social software into including CRM or ERP)? systems, its business practices and systems Customer service (e.g., enterprise systems, including CRM or ERP)? 29% 28% 10% 15% 18% A great deal Information technology Not at all 28% 32% 8% 16% 16% 9% 27% Product development Somewhat 27% 27% 21% 27% 9% 18% 24% 10% Not very much Human resources Don’t know 18% 31% 8% 20% 24% General management Q18  hat is the highest level / rank of the individ- W 16% 29% 9% 24% 23% Q18. What is the highest level/rank of themanage your ual whose job it is to oversee / individual whose job it is to business initiatives? organization’s social oversee/manage Operations your organizations social business initiatives? 13% 25% 9% 25% 29% Staff-level coordinator Supply chain operations management VP level and above 8% 18% 12% 24% 39% 9% Don’t know 28% Risk management 12% 7% 19% 11% 25% 39% 13% None Finance 21% 17% 6% 14% 9% 27% 44% Manager level Director level24 MIT SLOAN MANAGEMENT REVIEW • DELOITTE
  • 27. *  ote: Survey respon- N dents were asked to rank their top three selections. To determine an overall ranking, a composite Q20  hat are the main reasons employees participate in W score was computed by assigning a higherQ20. Whatsocial business activities at your organization? activities at are the main reasons employees participate in social media weight to a higher rankyour organization? (Please indicate the top 3 in order of significance) and a lower weight to a lower rank. Composite Score*Network with others in the organization 4,634Work more effectively 3,181Voice opinions 3,151Feel more connected to the organization 2,385Improve personal reputation 1,895 Q21  hat best describes the level of your orga- WDevelop skills 1,687 nization’s social business initiatives withMeet formal performance goals 604 each of these audiences in the past year? Q21. What best describes the level of your organization’s social business initiativesEarn monetary awards 210 with each of these audiences in the past year? Consistently Have a few Don’t Have a Don’t initiating (creating that are know few that have any or introducing) new expanding are static engagement initiatives Customers 21% 35% 7% 18% 19% Employees 20% 35% 5% 21% 19% Suppliers / Partners 9% 23% 12% 21% 35% Q22  hat metrics does your organization use to determine the W success of internal social business initiatives?Q22. What metrics does your organization use to determine the success of internalsocial business initiatives? (Please indicate the top 3 in order of significance) Composite Score * Do not measure 4,721 Number of employees signed up / registered 1,698 Number of employees posting 1,633 Total number of posts 1,402 Other metrics external to social business 1,207 (e.g., increase in sales, reduction in customer complaints) Employee satisfaction metrics 1,029 Q23  hat metrics does your organization use to determine the W Number of topics 824 success of externally facing social business initiatives? Q23. What metrics does your organization use to determine the success of externally- facing social business initiatives? (Please indicate the top 3 in order of significance) Composite Score* Do not measure 3,271 Hits and clickthroughs on blogs 2,515 and social networks Web traffic 2,246 Follows on social networks 1,984 Brand / reputation enhancement 1,430 Correlation to sales 1,040 Press mentions 698 Net promoter scores 446 SOCIAL BUSINESS: WHAT ARE COMPANIES REALLY DOING? • MIT SLOAN MANAGEMENT REVIEW 25
  • 28. R E S E A R C H R E P O R T S O C I A L B U S I N E S S : W H AT A R E C O M PA N I E S R E A L LY D O I N G ? Demographic Questions A. What were the revenues of your parent organization in D. Which of the following best describes your role? its last fiscal year (in US dollars)? Board member 2% Over $20 bil. 11% CEO / President / Managing director 14% $10 - $20 bil. 6% CFO / Treasurer / Comptroller 4% $5 - $10 bil. 5% CIO / Technology director 2% $1 - $5 bil. 13% Other C-level executive focused on social media 0.5% $500 mil. - $1 bil. 8% Other C-level executive 4% $250 - $500 mil. 10% or equivalent Senior VP / VP / Director 17% Under $250 mil. 47% Head of business unit or department 13% Manager 24% Marketing staff 2% B. What is your organizations total headcount? IT staff 2% Employees Over 100,000 7% Sales staff 2% 10,000 - 100,000 17% Product development staff 3% 5,000 - 10,000 8% Other 11% 1,000 - 5,000 16% Under 1,000 52% E. What is your organizations primary industry? Professional Services 15.2% IT and Technology 12.2% C. What is your primary functional affiliation? Education 11.5% General management 21% Manufacturing 7.7% Finance 12% Financial Services – Banking 5.0% Marketing 10% Healthcare Services – 3.8% Provider Information technology 8% Energy and Utilities 3.7% Operations 7% Financial Services – Asset Management, Private Equity 3.6% Research & development 6% Consumer Goods 3.4% Human resources 5% Entertainment, Media and Publishing 3.3% Product development 5% Telecommunications / Communications 3.2% Sales 5% Government / Public Sector 2.9% – Federal / Central Customer service 4% 2.8% Aerospace and Defense Supply chain operations management 2% Retail 2.6% Risk management 2% Financial Services – Insurance 2.5% Other 13% Construction and Real Estate 2.4% Pharmaceuticals and Biotechnology 2.4% Transportation, Travel 2.2% and Tourism Automotive 1.9% Electronics 1.5% Government / Public Sector – City / Local 1.5% Chemicals & Petroleum 1.5% Agriculture and Agribusiness 1.3% Logistics and Distribution 1.2% Healthcare Services – Payer 0.9%26 MIT SLOAN MANAGEMENT REVIEW • DELOITTE
  • 29. F. What is your age?F. What is your age? 26% 26% 23% 23% 18% 15% 11% 18% 4% 15% 2% 0.3% 22 28 36 45 53 60 Prefer 11% Years old not to answer 4% 2% 0.3% 22 28 36 45 53 60 Prefer not to answer Years oldG. In which country do you live ? H. What is your level of technological interest ? United States 53% 1. Low: I just use the tools I’m given to get the job done; learning new gadgets is a waste of time India 6% 1% Canada 5% 2. Somewhat low: I take what I’m given, but it’s fun to have good technology once I’m used to itUnited Kingdom 3% *Approximately one percent each 8% Australia 3% for Mexico, Spain, Germany, Netherlands, South Africa, China, 3. Medium: I’m aware of blockbuster technology trends, Brazil 2% Singapore, Italy, Portugal, New and may get certain new items in their first few months Zealand, Colombia, Malaysia, France 2% Nigeria, Switzerland and Turkey 26% Other* 1% 4. Somewhat high: I like playing with new toys, but I don’t have to be an early adopter 42% 5. Very high: I like to get the latest and greatest gadgets; my friends consult me for tech advice 23% SOCIAL BUSINESS: WHAT ARE COMPANIES REALLY DOING? • MIT SLOAN MANAGEMENT REVIEW 27
  • 30. ACKNOWLEDGMENTS Michael Barrette, MIT Sloan Management Review; Patricia Favreau-McKinley, MIT Sloan Communica- tions; Chris Heuer, Deloitte Consulting LLP; Prasad Kantamneni, Deloitte Services LP; Laura Pinsky, MIT Sloan Communications; Joseph Press, Deloitte Consulting LLP; Venkat Reddy, Deloitte Services LP; Giovanni Rodriguez, Deloitte Consulting LLP; Prathima Shetty, Deloitte Services LP INTERVIEWEES Anthony Bradley, Group Vice President, Gartner; Charles Dickerson, Vice President of Customer Care, Pepco Holdings; Vince Golla, Director of Digital Media and Syndication, Kaiser Permanente; Fergus Griffin, Senior Vice President for Solutions Marketing, Salesforce.com; John Hagel III, Co-Chairman, Deloitte Center for the Edge; Catherine Havasi, Director, Digital Intuition Group, MIT Media Lab; Donna Hoffman, Professor, University of California, Riverside; Gerald Kane, Assistant Professor, Boston College; Charlene Li, Founder, The Altimeter Group; Andrew McAfee, Principal Research Scientist, MIT; Mark McDonald, Group Vice President, Gartner; Matt Moller, Director of Digital Engagement, Samsung; Natasha Nelson, Vice President of Business Intelligence, Cara Operations; Wanda Orlikowski, Professor, MIT Sloan School of Management; Keri Pearlson, Adjunct Professor, Babson College; Tom Poole, Manag- ing Vice President for Mobile and Social Media, Capital One; Randal Robison, CIO, Georgia-Pacific; David Sacks, CEO, Yammer; Jeff Schick, Vice President of Social Software, IBM; Derek I. Smith, Senior Vice President of Operations Strategy, 20th Century Fox; Edwin J. Tucker, Vice President of Global Medical Safety, Johnson & Johnson Pharmaceutical Research; Marshall Van Alstyne, Associate Professor, Boston University; Richard Waycott, CEO, The Almond Board of California; Rick Wion, Director of Social Media, McDonald’s; Mark Yolton, Senior Vice President of SAP Communities and Social Media, SAPMIT Sloan Management Review affect your business. Before making any decision or taking any ac-MIT Sloan Management Review leads the discourse among aca- tion that may affect your business, you should consult a qualifieddemic researchers, business executives and other influential professional advisor. Deloitte, its affiliates and related entitiesthought leaders about advances in management practice that are shall not be responsible for any loss sustained by any person whotransforming how people lead and innovate. MIT SMR dissemi- relies on this publication.nates new management research and innovative ideas so that As used in this document, “Deloitte” means Deloitte Consult-thoughtful executives can capitalize on the opportunities gener- ing LLP and Deloitte Services LP, which are separate subsidiariesated by rapid organizational, technological and societal change. of Deloitte LLP. Please see www.deloitte.com/us/about for a de- You may contact the authors or find additional reporting from tailed description of the legal structure of Deloitte LLP and itsMIT Sloan Management Review at sloanreview.mit.edu subsidiaries. Certain services may not be available to attest clients under the rules and regulations of public accounting.Deloitte Copyright © 2012 Deloitte Development LLC. All rights re-This publication contains general information only and is based served. 
Member of Deloitte Touche Tohmatsu Limitedon the experiences and research of Deloitte practitioners. Deloitte You may contact the authors or send an e-mail to techtrends@is not, by means of this publication, rendering business, financial, deloitte.com for more information.investment or other professional advice or services. This publica- Additional information from Deloitte on the topic of socialtion is not a substitute for such professional advice or services, business can be found at www.deloitte.com/us/socialbusinessstudynor should it be used as a basis for any decision or action that may28 MIT SLOAN MANAGEMENT REVIEW • DELOITTE
  • 31. PDFs ■ Permission to Copy ■ Back Issues ■ ReprintsArticles published in MIT Sloan Management Review arecopyrighted by the Massachusetts Institute of Technologyunless otherwise specified at the end of an article.MIT Sloan Management Review articles, permissions,and back issues can be purchased on our Web site:www.pubservice.com/msstore or you may order throughour Business Service Center (9 a.m.-7 p.m. ET) at thephone numbers listed below. Paper reprints are availablein quantities of 250 or more.To reproduce or transmit one or more MIT SloanManagement Review articles by electronic ormechanical means (including photocopying or archivingin any information storage or retrieval system) requireswritten permission. To request permission, use our Web site(www.pubservice.com/msstore), call or e-mail:Toll-free: 800-876-5764 (US and Canada)International: 818-487-2064Fax: 818-487-4550E-mail: MITSMR@pubservice.comPosting of full-text SMR articles on publicly accessibleInternet sites is prohibited. To obtain permission to postarticles on secure and/or password-protected intranet sites,e-mail your request to MITSMR@pubservice.comCustomer ServiceMIT Sloan Management ReviewPO Box 15955North Hollywood, CA 91615