In recent months, I’ve read a lot of industry articles, whitepapers and blogs about the Social Enterprise or sometimes called Social Business. In essence this seems to mean enterprises are becoming more collaborative both internally with employees as well as externally with suppliers, business partners and most importantly customers. Yes it relies upon deploying new applications to support this collaborative effort but the most significant facet is the implications of a fairly radical cultural shift; both in terms of how we communicate and the future role that IT organisations need to play.
But as ever with market trends, there seems to be confusion in a broader context...
According to Wikipedia the term “Social Business” was first defined by Nobel Peace Prize Laureate Prof. Muhammad Yunus with this definition “a social business is a non-loss, non-dividend company designed to address a social objective within the highly regulated marketplace of today. It is distinct from a non-profit because the business should seek to generate a modest profit but this will be used to expand the company’s reach, improve the product or service or in other ways to subsidise the social mission.”
This more broadly-known definition then talks to social/corporate responsibility. So, why are IT vendors and consulting companies pushing a new definition? And is the word “social” misleading or just the band wagon effect? Well it seems to be driven by a number of factors suggesting that this is an intrinsic part of our future:
Business fundamentals – The basic fundamentals of increasing workforce productivity, reducing costs, attracting and retaining customers, optimising supply chains are as important now as they always have been. However, the globalisation machine has made this significantly more complex with industries and countries more intertwined, as witnessed by the current stop/start global economic recovery.
Cultural shift – technology has undoubtedly changed the workplace culture... when I entered the workforce 15 years ago we relied upon snail mail, telephone and fax communications with a simple LAN (Local Area Network) to access order processing systems. A lone PC stood in the corner for word processing and desktop publishing but was eventually connected to the Internet to send email. However, today’s generation Y employees are used to communicating in a markedly varied way through SMS, IM and Social Media with a healthy scepticism of email. They also have a much deeper, almost implicit understanding of primary IT and networking concepts. The barrier to entry is not technical but perhaps predicated to a fashion status, how many times have you heard recently; “Is there an app for that?”
IT evolution – Since the advent of the Internet and smartphone devices the velocity of change has increased at dramatic rates. From the transition towards cloud based services, the adoption of smartphones and tablets, and the onslaught of these apps designed to make access to everyday information more relevant to the individual, and frankly simpler. None of this could be achieved without creating networks that allow for scale and security or without applications optimised for different devices and information formats. The problem with all this change is how to interpret these often complex dynamics and translate them into new business models and strategies to drive competitive advantage. Another key consideration is the impact this is starting to have on how companies approach change, which has never been truer than for IT organisations, who are approaching a fork in the road – more on this in my next blog.
Periods of economic instability tend to sort out the wheat from the chaff. It’s therefore highly likely we will see companies accelerating new business models in the market over the coming months and years, driven by a desire to be more social. This increasingly interconnected business model is going to challenge IT departments in a number of ways: increasing security risks, the services provided to employees, data management across multiple domains and the new network architectures needed to simplify access from multiple locations and devices.
Whether you call it Social Business, Social Enterprise or the Consumerisation of IT, it is going to reshape the role of IT organisations over the coming years and as I read more blogs/ forums/ comments from CIOs, it's seen as either an opportunity for IT to become strategic or to fall into a sand trap and lose control.
Check out Burberry's Social Enterprise story below and let me know your thoughts...
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