by Kristin Burnham

How to Use Social Media to Create Business Value

Nov 14, 20125 mins
CIOCollaboration SoftwareConsumer Electronics

According to a report from IBM, 62 percent of enterprises will increase social business spending in the next three years. But companies are still struggling with the cultural changes that a social business implementation requires. Here's a look at new statistics plus tips for ensuring adoption.

What makes your business a top business? According to a new report from the IBM Institute for Business Value, it could be how well your company implements social business.

In “The Business of Social Business,” authors James Cortada, Eric Lesser and Peter Korsten argue that social is no longer “simply a ‘sandbox’ for the under-30 generation.” Merely developing and deploying the technology isn’t enough.

“[…] Companies at the forefront are doing more than developing a presence on major platforms. They are taking their external social tools and embedding them into core business processes and capabilities. They are using social approaches not only to communicate better with their suppliers, business partners and, perhaps, most important, their employees.”

IBM’s study of more than 1,100 businesses around the globe reveals that investment in social business is on the rise: Forty-six percent of the companies surveyed increased their investments in social business in 2012, and 62 percent indicated they are going to increase their expenditures in the next three years.

The sudden rise of social business is challenging the corporate culture at some companies, which respondents indicate is something they’re struggling with: Nearly three-quarters report they were underprepared for the required cultural changes.

“Executives are concerned because social business represents a different way of thinking about employees, customers and how work is accomplished, as well as the potential risks of increased organizational openness and transparency,” the report says.

Here’s a look at the study’s top findings, plus tips for how your company can transform into a successful social business.

[How to Succeed at Social Business]

Embedding Social Into the Organization

“Our survey and interviews have made one thing clear,” the report says. “Those organizations experiencing the most success in social business approaches know they have to make fundamental changes in the way their employees worked across the entire enterprise.”


Click image for full infographic.

Successfully embedding social business into an organization requires three steps, according to the report:

1. Consider how to incorporate social metrics into traditional enterprises and processes. According to the report, only about 20 percent of organizations are able to define key performance indicators and track the ROI of social business efforts. Those that couldn’t do so struggled with their social initiative.

But quantifying results based only on cost-savings isn’t sufficient, the report finds. Instead, businesses should consider piloting a project to demonstrate the hard and soft benefits of a social initiative and compare it to the performance of individuals not using the social tool.

“We also heard from respondents that justifying the ROI of social effort is only one potential use of social data,” the report says. “Analytics can make it possible for organizations to integrate social and traditional data sources to make more effective decisions about customers and the workforce. By examining the residual data from social activities, organizations can develop valuable insights not previously available.”

[CIOs Must Embrace Social Networks to Drive Social Business]

2. Understand and manage the risks associated with social business. Respondents to IBM’s survey cite a number of concerns about the use of social business tools: attacks on their brands, legal issues, data security and privacy, and unintended disclosure of company information.

About half the companies surveyed say they do not have effective processes in place to deal with these concerns, while nearly a quarter say they do, and another third have efforts underway, according to the report.

Successful businesses have established policies for employees to follow when engaging in social business and have a governance structure for managing and monitoring enterprise-wide social business behavior, the report says. In addition, successful businesses must achieve the following:

  • Identify potential exposures, proactively involve the right experts and develop risk management plans.
  • Think through their problems and understand regulatory drivers and their impact on the organization.
  • Ask questions about why a behavior is a risk and how to mitigate it.
  • Engage key functional experts before problems occur. These include people from areas such as HR, legal, IT, communications, finance and risk.

3. Establish a unique application of traditional change management principles to influence corporate culture and performance. According to the survey, 48 percent of organizations have support from the C-suite, but only 22 percent believe that managers are prepared to incorporate social business into their daily practices.

IBM suggests three actions that will assist people in understanding the value of social initiatives, involve the right stakeholders and provide the appropriate support and motivation:

  1. Get people involved in using the right tools. Create hands-on opportunities to use new social business tools; provide one-on-one coaching and reverse mentoring and encourage leaders to model desired behaviors to signal social “permission”; and capture success stories through the use of social tools such as wikis, blogs and videos.
  2. Apply traditional change management concepts to support transitions. Appoint a number of social business champions or subject experts to encourage and accelerate adoption; provide education about why this is important and what the guidelines are for using social media tools inside and outside the organization; and recognize desired usage and behaviors.
  3. Incorporate social approaches to supporting the change. Develop user narratives and scenarios of possibilities provided by using social approaches; use social networking approaches to identify and engage with influence leaders; provide support to employees, partners and customers.

[Employee Education Is Key to Social Business Adoption]

“The case for why more organizations are implementing social business practices comes down to sustaining their competitiveness and profitability in economies in which rivals, partners and customers are adopting new ways of conducting business,” the report says. “More than simply using social media tools, we have entered a new period of fundamental transformation in the way work is done at all levels of the enterprise and across all organizational boundaries.”

Kristin Burnham covers consumer technology, social networking and enterprise collaboration for Follow Kristin on Twitter @kmburnham. Follow everything from on Twitter @CIOonline and on Facebook. Email Kristin at