Social Media Offers Opportunities and Challenges

By Samuel Greengard  |  Posted 2013-02-27

By Samuel Greengard

A few years ago, enterprise social media consisted of little more than creating a Facebook page and monitoring Twitter for sundry comments and complaints. In many instances, all that was needed was a handful of younger workers or interns to sift through posting and feeds and provide a basic response. It's safe to say that social media was little more than a blip on the information technology horizon.

That's no longer the case. "Today, virtually every customer-focused and employee-centric system has a social component," observes Ted Shelton, managing director at PwC and author of Business Models for the Social Mobile Cloud: Transform Your Business Using Social Media, Mobile Internet, and Cloud Computing. "Social media is creating enormous opportunities in areas as diverse as collaboration and analytics. It is fundamentally changing the nature of business interaction."

For IT departments, this unfolding and rapidly evolving environment is fraught with challenges. It's critical to build an IT architecture that supports social media tools and extends them to mobile devices. It's also crucial to cull unstructured social media data and plug it into existing databases and systems in order to support advanced analytics.

Finally, there are cultural issues to consider and security challenges to address. "It's an area that no company can ignore," says Forrester principal analyst Clay Richardson.

Businesses Go Social

Social media has clearly arrived at the mainstream of enterprise IT. According to various industry statistics, about four in five companies are already using or planning to use social media. A 2012 MIT/Sloan Management Review study found that 52 percent of executives say social media is important to their firms today, while 86 percent believe it will be vital within three years. Key areas include: marketing and advertising, researching competitors and improving relationships with customers.

Yet, behind the flashy façade of new and emerging social media services, interfaces and tools lies a simple fact: The concept boils down to systems that revolve around the free flow of information and knowledge, Richardson says.

The ability to tap into a more democratized system—one that delivers information upward, downward and sideways throughout the organization and marketplace—is a transformative step in the evolution of business. In fact, he says, "We are beginning to see social and business processes merge together to create greater capabilities."

Putting social to work is now a core strategy at EDP Renewables North America, which operates 29 wind farms and thousands of turbines across the United States. The company must closely monitor turbine performance and repairs across nearly two-dozen key departments.

"Different departments must collaborate with each other—using structured data, written information, audio and video—in order to keep everyone up to speed on current conditions and problems," says Stephan Blasilli, corporate development manager for EDPR.

In the past, manual and semi-automated processes were often slow and tedious. Today, using a social-based case management system running on an Appian BPM platform, EDPR is able to tap into what Blasilli refers to as "extreme collaboration." Geographically dispersed teams exchange notes, expertise, data and various media in real time. In addition, based on the error code for a turbine, they can prioritize discussions and broaden the collaboration process, if necessary.

The platform, dubbed COBRA, short for "COlaBoRAtion, offers analytics capabilities, and it will soon extend to mobile devices. Already, more than $100 million in issue relation resides in the system, and Blasilli says that it is speeding resolution by 10 to 25 percent.

Moving Beyond 'Like'

As organizations adopt social media tools and add advanced capabilities such big data analytics, the challenges grow. Determining how a brand is trending or what products are most appealing doesn't happen without robust and well-designed systems.

One of the problems, Forrester’s Richardson says, is that different software platforms and tools use different methods to control conversations and capture data. Consequently, it's critical to ensure that all the data is accessible and compatible. "Otherwise, you wind up with 'social ghettos,' and your analytics program is only tapping into bits and slices of the overall data picture," he notes.

Success requires a focus on strategy, along with a heavy emphasis on finding the right methodologies and tools. "An organization must normalize the data—usually through a master data management platform," Richardson notes.

PwC's Shelton says that social is intricately tied to three other key technologies: mobile, cloud and big data. An enterprise must interconnect these data sources in order to achieve the full potential of the technology—namely, a persistent connection to social data.

A Swedish appliance manufacturing giant is among the companies leveraging social media to spur innovation. Electrolux, which is more than 90 years old, uses IBM's Social Business to facilitate communication across 60 countries and to spur product development, as well as an array of other operational tasks.

Ralf Larsson, director of online engagement, says that the current social media initiative grew out of an intranet that dates back more than a decade. "We are constantly looking for ways to improve the business relevance of data," he says.

Using a social dashboard, employees are able to form connections instantly and on an ad hoc basis. This makes it far easier to solve problems and share knowledge across the enterprise. Electrolux is currently extending the platform to mobile devices, including iPads.

"If there's a technical question, employees can upload it and share documents and find the right person to provide an answer,” Larsson explains. “We want a team to be able to reach the right person, regardless of where they are located."

In some cases, issues that previously took days or weeks to address are now tackled in minutes or hours. In addition, Electrolux recently held its first Innovation Jam, inviting the entire company to a three-day crowdsourcing activity. More than 7,000 employees generated more than 3,500 ideas for new products and services.

PwC's Shelton says that businesses must view social media as more than a necessity and a cost center. "It's important to think about the technology as a strategic tool that allows an organization to transform itself and outperform the competition," he explains.

However, in order to realize actual ROI, an enterprise must recognize that social technology fundamentally changes organizational structures and decision-making processes. "You cannot apply social to old business models,” Shelton warns. “It requires different thinking and behavior. Organizations that switch it on one day and send out an email announcing a new social network are bound for failure."

Business and IT leaders must examine the business and look for places in the organization that can derive the biggest benefit from social media. They must also design workflows and checkpoints into the software and systems to ensure that the right people are engaged, and that thought leaders are easily flagged and tagged.

Finally, Shelton says, "It's vital to put a change management program in place to train employees and give them the incentives and motivation to be able to transform the way they work." Ultimately, there must be recognition that the social media initiative provides a high level of value and clear business results.

Forrester's Richardson says that as organizations tie together social media and other business platforms—including BPM, ERP, BI and enterprise project management—they're able to design and build a platform that's built for digital age communication, collaboration and insight. What's more, as social technology gets smarter and incorporates roles and behavior, the capabilities continue to grow.

"When social media is used effectively it transforms passive information into active knowledge," Richardson concludes. "It creates a more dynamic and agile relationship to information.”