Social Networking Drives Business Processes at Pandora and Rosetta Stone

Pandora and Rosetta Stone have embraced social business tools and the cloud to cut costs, increase productivity and improve collaboration. Learn how these two companies overcame security concerns, gained executive buy-in and more.

Two-thirds of businesses report they use social technologies for marketing and other purposes, but they don't integrate them into their business processes, according to AIIM's 2012 "Social in the Flow" report. Thirty-seven percent expect social media will be used regularly across their entire business over the next two years, and only 9 percent see it as being completely integrated.

While a majority of businesses still struggle to adopt and integrate social processes, language learning company Rosetta Stone and Internet radio company Pandora have successfully embraced the social business trend and are reaping the benefits.

Over the last few years, Rosetta Stone has swapped out about 70 percent of its technology infrastructure, including its ecommerce systems and internal technology applications, for SaaS offerings. Pandora, too, has turned to the cloud—100 percent of its business operations are now SaaS-based.

Both companies use Salesforce.com services today and both report improvements in collaboration, communication and productivity, though it wasn't without challenges. Here's a look at how Pandora and Rosetta Stone navigated security concerns, corporate culture change and gaining executive buy-in to reap social business's rewards.

Addressing Social Security Concerns

"We're a 20-year-old company and we knew we needed to change," says Rosetta Stone CIO Pradeep Mannakkara, who joined the company in mid-2011.

Rosetta Stone was already a proponent of social media—it has more than 1.5 million Facebook fans from pages in nine different languages—but it had yet to adopt a strategy to better communicate with and connect its 1,700 employees worldwide.

"When you have a lot of these teams in offices all around the world relying on email, travel and phone, you don't get as much done," Mannakkara says. "Our workforce is somewhat younger, too, and they use social tools in their personal lives. They kind of expect it at work now," he says.

About a year ago, Mannakkara and his team piloted Chatter, Salesforce's collaboration tool, twice: first in a group of a couple hundred users, and then in his tech group of about 100 employees. And while the pilots were successful and Chatter has since been rolled out to all Rosetta Stone employees, he admits he was skeptical at first.

"What if someone posts something inappropriate? How do you manage that? What about confidentiality? I had a lot of questions and heard a lot of debates. But what it comes down to is this: Technology is evolving and you can't try to police and control everything," he says. "It got to a point where some of these conversations were silly. This is the sort of thing that stops progress."

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Security was also a consideration at Pandora, a Salesforce and Chatter customer "since day one," says Richard Rothschild, vice president of Information Services. Rothschild joined Pandora in November 2011 after the company adopted Salesforce. Pandora became a cloud-based company about three years ago, he says, and since joining, he's helped onboard many SaaS applications.

"We've kind of grown up with Salesforce. The reality is that data is more secure in the cloud because it's harder for someone to access it since it exists in many places," he says. "These software companies are much more invested in system security than we could ever be because it's their lifeblood. We could never be as good at managing security as them." Pandora employs about 700 people.

Gaining Executive Buy-In and Navigating Corporate Culture

Mannakkara says that Rosetta Stone executives were onboard, for the most part, with the Chatter implementation. But not all businesses have that luxury, he acknowledges.

"You need to gauge the temperature of the exec team by doing a bite-sized implementation," Mannakkara says. "You need to feel out their tolerance for social and pitch it to them in a way so they see the benefits."

When Mannakkara pitched Chatter to his executive team, he focused on it as a communication tool to achieve better productivity. He highlighted how employees wanted to hear more from the executive team, and this was an easy way to get the job done.

"Plus, part of it is just having executives get exposure to the technology and others who have seen it work," he says. "Then they're not as afraid of the technology."

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Next was convincing employees that this tool was beneficial and safe. Mannakkara says they highlighted how it could alleviate email clutter and help employees keep in touch and collaborate with others around the world.

"Change can be hard to embrace. Some employees were concerned about someone saying something inappropriate," he says. "We told them that these things might happen, but it will correct itself. Our culture is that we want to know if employees have problems. Tell us. Regardless of how bad it may seem, if we don't acknowledge it we can't fix it."

Realizing the Social Business Benefits

Pandora deployed Salesforce and Chatter before Rothschild joined the company in 2011. He says that transitioning the company to the cloud was integral to the company going public in mid-2011.

"I dont think we could have gone public if we had to support something like Oracle and hire the people to run it," he says. "For a business like ours, the cost-savings have been really important."

Pandora's gains aren't just cost-savings. Rothschild says Chatter has improved the way employees communicate. The sales group, for example, uses Chatter as its primary means of communication. Rothschild's IT group of 15 employees uses the tool to plan meetings and the company uses it to organize social events like potluck dinners and announce music groups that come to perform every week.

"I wouldn't say it reduces the amount of conversation like you'd have on email, but it's more centralized, in real-time and it feels more casual," he says.

Rosetta Stone's Mannakkara says Chatter has decreased the amount of email they send and receive.

"Having a conversation on email drives me crazy," he says. "If we have more than two or three threads, the rule is to pick up the phone or start a Google Hangout."

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Both Rosetta Stone employees and its executive team have embraced Chatter fully. Mannakkara says that they display a Chatter feed during company meetings so the CEO can answer questions asked by employees from around the world.

Their CEO is now a big proponent of social, which Mannakkara says has helped set the tone for the rest of the company.

"He has two Macs in his office that rotate through our Facebook pages, our website and Chatter," he says. "He's staying on top of it all to see what employees are saying and what customers are saying. Their voices are just as important as the products we sell."

Pandora's Rothschild says because the company has no hardware or software to contend with, they're able to focus their efforts elsewhere.

"We don't spend any time worrying about what version of database we have or what our network is doing," he says. "We can spend our time making our company more effective and transforming the business instead of being in survive mode."

Kristin Burnham covers consumer technology, social networking and social business for CIO.com. Follow Kristin on Twitter @kmburnham. Follow everything from CIO.com on Twitter @CIOonline and on Facebook. Email Kristin at kburnham@cio.com

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