At Dreamforce in San Francisco this week, Salesforce.com CEO Marc Benioff trotted out executives from companies such as General Electric, Virgin America, Coca-Cola and Burberry to tell their success stories about connecting customers, employees, partners and, yes, even products.
“It’s a fundamental change in business,” Benioff told the crowd gathered at the Moscone Center, imploring them to get on board with the social revolution.
With the tagline “Touch the Social Enterprise” and boasting a record 95,000 registered attendees, Dreamforce turned out to be a social networking love-fest that featured a meandering interview with Sir Richard Branson and a Red Hot Chili Peppers concert in front of City Hall.
Wielding Salesforce.com tools, CEOs and CIOs professed great returns on investment from enterprise social networking. George Zimmer of Men’s Wearhouse said he had spent untold millions on television advertisements courting Baby Boomers but is transforming to social networking to reach Millennials and find out what they like and don’t like.
“You’re going to like the way Salesforce works, I guarantee it,” Zimmer says in a riff on his famous line.
Coca-Cola showed off the power of mobile and the cloud with a “smart” soda machine that connects to customers via a phone and lets them mix and match flavors and share recipes on Facebook.
Then there’s CEO Angela Ahrendts of Burberry waving her iPhone to the crowd and predicting that fashion advertising will link up with the mobile phone in scenarios reminiscent of the movie “Minority Report”. That is, advertisements on a wall will connect with customers via the smartphone.
Behind the glam, though, the social enterprise isn’t a dream come true.
Companies, for instance, talked about using Twitter to connect customers with customer service. When a customer complains on Twitter, someone at the company is listening and can respond. The underlying message: Air your complaints in a public way, and you’ll receive help.
“That denigrates your brand,” says Ian Jacobs, analyst at Ovum.
Jumping on the social enterprise bandwagon without carefully considering the possible consequences can spell disaster. Just ask NASA, which pulled the plug on its employee-facing social network, called Spacebook, earlier this year because it simply wasn’t being used enough by NASA staff.
In some cases, CIOs might better spend money on improving traditional communication channels rather than on social enterprise initiatives. With social, “you might be throwing money at a problem that doesn’t exist,” says Keith Dawson, another Ovum analyst.
There are certainly benefits of the social enterprise, but the risks of a badly performing social-connection effort are too significant to ignore, including turning off employees and customers and amplifying criticism of the company itself—all of which is a nightmare in the making.
Tom Kaneshige has been covering business and technology in Silicon Valley for two decades. As senior online writer at CIO.com, Tom covers Silicon Valley culture, BYOD and consumer tech in the enterprise.