Emerging Social Business Strategies in 2010 | Social Business Summit 2010

Emerging Social Business Strategies in 2010

What Works And WhyDion Hinchcliffe

Thursday, March 11, 2010

Introduction

Dion Hinchcliffe• ZDNet’s Enterprise Web 2.0

• http://blogs.zdnet.com/Hinchcliffe

• Social Computing Journal – Editor-in-Chief• http://socialcomputingjournal.com

• ebizQ’s Next-Generation Enterprises• http://www.ebizq.net/blogs/enterprise

• Hinchcliffe & Company• http://hinchcliffeandco.com

• mailto:[email protected]

• Web 2.0 University• http://web20university.com

• : @dhinchcliffe


http://blogs.zdnet.com/Hinchcliffe

http://blogs.zdnet.com/Hinchcliffe

http://socialcomputingmagazine.com/

http://socialcomputingmagazine.com/

http://www.ebizq.net/blogs/enterprise

http://www.ebizq.net/blogs/enterprise

http://hinchcliffeandco.com/

http://hinchcliffeandco.com/

mailto:[email protected]

mailto:[email protected]

http://web20university.com/

http://web20university.com/

Opening the SBS to the Web

http://bit.ly/97hfp4


http://www.google.com/moderator/#16/e=4c5c

http://www.google.com/moderator/#16/e=4c5c

The vision• How we run our businesses is changing more quickly

than ever before

• New technology and expectations have led to results not possible -- or expected -- before

• New economic, social, governmental, and cultural models emerging globally

• Largely driven by the Web, but changes in us too

• A pragmatic exploration of how they promote resilient, sustainable new business models

• Using what’s happened recently as a guide, what will this transformation look like?


The network is abig place today

• All your customers

• All your competitors

• All the ideas and innovation

• Only a few proven strategies for long-term competitive advantage


The major shifts

• In who creates value (the network does)

• How much control we have over our businesses

• How intellectual property works

• Great increases in transparency and openness

• Open supply chains, community-based processes and relationships


The motive forces of 21st century business

• Network effects

• Peer production

• Self-service

• Open business models

• New social power structures

that we

know of so

far

^


Microblogs

BusinessTradingPartners

World Wide WebCustomers + Public

Trust, Engagement, Reputation

The Social Web

Public Social NetworksInteraction and Social Business

E2.0 Workflow

Unified Comm 2.0

E2.0 Compliance

Community Mgmt Social Web Tech & Standards

Us

B2C

B2B

CustomerCommunities

WorkerOnline

Community

The Social Business Landscape

1-2 billion people


The Big Questions

• How do we build and sustain a connection with a fundamentally new marketplace?

• What are the rules for success?

• What do social businesses look like?

• Are we starting to understand best practices?

• Where is this going? Is it part of a larger story?


Edge Businesses:A Larger Context?

Always involve people,but may not necessarilybe social


The Story of KatrinaList & XM Radio• Hurricane Katrina– Survivors emerged and announced

where they were on their blogs– People watching the Web’s syndication

“ecosystem” noticed the reports– A small group collected the reports out

of the blogosphere and centralized the listing

– Over 50,000 survivor reports in the first 3 days after the disaster

– Emergent phenomenon– A critical example for how to rethink

solutions to traditional problems in a 2.0 world in which we can actually tap collective intelligence

• XM Radio• Community for Customer

Service


A Few EdgeBusiness Stories

• Open Source Software (OSS)

•

• The Search for Steve Fossett

• Innocentive

• One Billion Minds

•Thursday, March 11, 2010

The Map of Opportunity

Creating new rapid growth public services powered by:• Peer Production• Jakob’s Law • The Long Tail• Blue Ocean• NetworkEffects

Reinventing the public relationship to drive mission:• Customer Communities•Customer Self-Service• Marketing 2.0

Driving costs down through less expensive, better 2.0 solutions:

• Lightweight IT/SOA• Enterprise mashups• Expertise Location• Knowledge RetentionImproving

productivity and access to value:

• Enterprise 2.0• Open APIs• Crowdsourcing• Prediction Markets

Business Remodeling and Restructuring

• BPM 2.0• Employee

Communities• Cloudsourcing• Pull Systems

Change Management

• Transformation Communities

• 2.0 Education• Capability

Acquisition

Fostering Innovation

• Internal Innovation Markets• Open innovation• Database of Intentions

Leveraging Innovation• Product Incubators• Open Supply Chains• Product Development 2.0• Some Rights Reserved

Innovation

Transformation Cost Reduction

Growth

Current State


The challenges

• Cultural “chasms”

• Disruption

• Cost

• Risk

• Difficulty (“Digital DNA”)

• Repeatability


The biggest challenge is in changing our thinking

However, it’s usually a people problem:


Rating social business strategies

Proven Benefit

RepeatabilityChallenges

Uncertain Results

Ready for Wide Adoption

Strategic Industry Play

Suitable for Experimentation

QuestionableValue

Ideal for Early Adopters


Where SocialBusiness Applies

Product Development

Marketing

Sales

Operations | IT | Back Office

Line of Business

Customer Service

crowdsourcing

onlinecommunity

cloud computingmashups

open APIsSaaS

Enterprise 2.0 &Social Business Models

newdevelopment

paradigms

(social media

in the

enterprise)

Product Development 2.0


No small system can withstand sustained contact with a much larger system without being

fundamentally changed.



The Implications ofSocial Business

• The fundamental re-orienting of the supply chain inputs of most organizations

• Network structured organizations instead of hierarchical

• New value exchange mechanisms that involve direct value (ideas, work) transfer instead of financial transactions

• Dramatically collapsed resource models for accomplishing previously very difficult and/or large scale business problems

• A steady recasting of the very notion of what a business consists of


Social BusinessFor Collaboration

(aka Enterprise 2.0)



Applying the “Web 2.0 effect” at work

• Enterprise 2.0

– Globally visible, persistent collaboration

• Employees, partners, and even customers

• Leaves behind highly reusable knowledge

– Uses wikis, blogs, social networks, and other Web 2.0 applications to enable low-barrier collaboration across the enterprise

– Puts workers into central focus as contributors

– Case studies of early adoption consistently verifying significant levels of productivity and innovation

Enterprise 2.0 systems adapt to the environment, rather

than requiring the environment to adapt to it.


Potential E2.0 Benefits

Productivity

Knowledge Retention

Information Discovery

Business Agility

Cross-Pollination

Fostering Innovation

Competitive Advantage

Modern Workplace

More Transparency

Less Duplication

Better Communication

Cost Reduction


Challenge:The enterprise is not the Web

• We want to replicate the positive aspects of Web 2.0 platforms in the enterprise

• But our infrastructure is usually not very Web-like, creating significant impedance and diluted results

• Requires augmentation and adaptation to reproduce the same or similar results

Enterprise


Enterprise 2.0 Benefits


Enterprise 2.0:The bottom line

• Repeatable

• Low Risk

• Proven Benefit

• Rapid ROI

• Transunion Enterprise 2.0 case study: $3.5M recoup in 5 months with $50K investment: http://bit.ly/O74W



Open Supply Chains & Open Data

also known

as APIs


Open Supply Chainswith partnercommunitiesand open APIs

Key Point:New online products simply aren’t released today without building a partner community


vs.

The Platform Overtakes the Web Site:


“Platforming” Your Business

• Requires opening the server-side to 3rd party developers

• Allowing the construction of widgets and Web apps offering some or of all of your functionality by external partners

• Harnessing the innovation on the network

• Generating the greatest potential reach, competitive lock-out, market share, and revenue

• This is live, not data files like at http://data.gov


http://data.gov

http://data.gov

Open Supply Chains:The bottom line

• Good repeatability

• Can be costly

• Unproven in certain industries

• Proven ROI

Strategic Industry Play


Online Community



What do online communities do?• Customers and workers find and connect with

each other based on a common, shared idea

• Socialize, communicate, and collaborate on topics that they care about

• Share ideas, experiences, stories, suggestions, etc.

• Draw others in by word of mouth

• Becomes an ideal vehicle for collective intelligence and peer production


CustomerCommunity

Partner Community

MarketplaceCommunity

Worker Community

Internetenterprise

Enterprise 2.0 &Social Media

Social Business

Community Management

crossover crossover

businessmodels

support participation

direction

resources


Online Community Management:A Core Social Business Function

Software Know-How

Feature Selection

Priority & ScheduleManagementDocumentation

Incorporation of Experience

OutreachEvents

IncentivesIssue Management

Networking

Identification of Best Practices

Attend Trade Events

Brand SupportSituation Management

Listen/Join Conversation

Marketing AnalysisImpact Reporting

Ad Rotation

Team Building

Staff Training

BudgetingGoal Definition

Business AlignmentControl/Management

Moderation & Rule Enforcement

Elicit Participation

Content Plan

Platform Management

Project Management

Product Management

Upgrades and Improvements

Customer Management

Product Selection

Professional Development

Brand Management

Advertising & Marketing

Staff Development Recruiting

Business Planning

Community Management

Rewards & IncentivesContent

Management

Research & Insight

Capture Brand Feedback

Content “Gardening”


Online Community:The bottom line

• Medium repeatability

• Can be costly

• Proven ROI

• Dramatically lower customer support costs (10-30%)

• Better Customer Satisfaction

• New customer relationship



Open Business Models


Open Data

UGC & Open Content

Open Source

Online Community

Open BusinessMethods

• Richest, most up-to-date, and dynamic products & services

• Lowest cost of production• Greatest degree of innovation

and diversity• Ownership, control, and

monetization challenges

Network-Driven Open Collaboration

Breeding New Business Strategies

peer production

network effects

self-service

pull instead of push

Methods:

Enterprise 2.0


Product Development 2.0


Crowdsourcing

Text


Open business models are transforming the market

• Product Development

• Marketing and Advertising

• Operations

• Customer Service


Examples

• Android

• Gold Corp.

• Crowdspring

• http://netflixprize.com

• Doritos UGC advertising

• http://OpenStreetMap.org


http://netflixprize.com

http://netflixprize.com

http://OpenStreetMap.org

http://OpenStreetMap.org

Sourcing Models

internally sourced

outsourced open sourced

Methodsdirect

assignmentsubcontracting,

consortiums

peer production,crowdsourcing, open platforms

Participants staff contractors,partners

anyone

Central Control highmedium to high medium to low

Predictability best good lowest

Richness of Outcome

adequate medium high

Legal structure& IP protection

corporation,copyrights,

patents, etc.

contracts, charters, etc.

open sourcelicenses, Creative

Commons, etc.


Open Business Models:The bottom line

• Medium repeatability

• Medium costs

• Significant cultural changes required

• ROI and control challenges

• Major strategic benefits

Ideal for Early Adopters


How do were-imagine our

organizations for the 21st century?


What Works And Why

• Network Effects By Default

• Turning Business Processes Social

• Partnering with the Network

• Giving Up Non-Essential Control

• Growing Cumulative Social Capital

• Building on the Shoulders of Giants


Challenges to Transitioning to New Social Business Models

• Innovator’s Dilemma

• “How do we disrupt ourselves before our competition does?”

• Not-Invented Here

• Overly fearful of failure

• Deeply ingrained classical business culture

• Low level of 2.0 literacy


Key Lesson:We now have a

fundamentally new and better set of lenses through which to look at creating

business value...


It’s time to changeour DNA

• Moving from the 20th century towards 21st century businesses

• Deeply understanding the network and its profound potential for creating growth and building value

• Putting 2.0 into the core of our modern government design


The rewards are considerable

• A business world that is sustainable

• Successful transition to a rapid evolving new business landscape

• Attaining of better and new type relationships with citizens and workers

• Resilience to future change and ongoing evolution of business, culture, and society


Discussion

Slides: [email protected]


Emerging Social Business Strategies in 2010 | Social Business Summit 2010

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