Social Software Needs Metrics That Matter

Deloitte's John Hagel says enterprise social networking can help people find a passion for work and boost business performance during an Enterprise 2.0 keynote address.
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Social software has the potential to make a real difference for organizations if it can help people discover a passion for their work--passion that translates directly into corporate performance, John Hagel III argued in the kickoff keynote for the Enterprise 2.0 conference in Boston, a UBM TechWeb event.

Enterprise 2.0
Following a day of workshops on Monday, Enterprise 2.0 reconvened for a series of general sessions led off by Hagel, co-chair of Deloitte's Center for the Edge innovation program and co-author of The Power of Pull: How Small Moves, Smartly Made, Can Set Big Things in Motion.

While Enterprise 2.0 attendees may think they know the answer, he said business leaders are still asking "Does social software really matter?"

To make sure the answer will prove to be yes for your organization, focus your applications on "metrics that matter," ranging from the top and bottom-line financials the CEO and CFO care about to the operational measures of middle management and the performance of front-line employees, he said. The challenge is "to frame the opportunity in terms of metrics that matter to each level of the organization."

For example, a consulting engagement for a metropolitan transit authority started with a discussion of creating a Facebook page--initially the only application the agency saw for social media--but transformed into something much more significant when Deloitte looked at finding a way to use social software for a specific business problem.

It turned out one of the transit authority's biggest financial drains was the expense of bus maintenance and the amount of time a broken-down vehicle would be out of service. Part of the reason for the maintenance issues was that parts were scattered across different depots, with no coherent tracking mechanism. Just by providing maintenance workers a microblogging tool to post requests for parts they needed, the authority was able to speed up repairs and reduce the cost of the maintenance operation.

This experience "turned out to completely transform their view of social software from an interesting marketing tool without a whole lot of specific impact" to something more game changing, Hagel said. One way of identifying a good social software starting place is to start with metrics that matter and trace them back to a target business process, he said.

When SAP introduced a developers network community in support of its NetWeaver integration middleware, the online community started out simple but grew in sophistication and value as more developers participated, Hagel said. Today, the developers network covers more products, has about 2 million members, while the average time required to get an answer from the community has shrunk to 17 minutes, Hagel said. One of the most effective community-building tools was to rank members by their participation and how effective they were at solving problems for their peers. Technology recruiters subsequently learned to tap into that network because it allowed them to identify exceptional candidates "not because they claim expertise, but because they are demonstrating expertise."

Successful social software deployments often start by tackling a fairly specific problem that users can easily become engaged in before progressing to more ambitious deployments. Reflecting the gamification trend in social software, Hagel said the pattern is not so different from how users progress in an online game like World of Warcraft, where they start with relatively simple adventures and progress to more challenging ones as they gain status and start to build teams.

Recognition and reward for a "questing disposition" to tackle problems builds passionate participation--something that's very much needed in business, Hagel said. Although executives often squirm when he brings up the subject, perhaps associating "passion" with New Age touchy-feely self actualization, Hagel said he comes to the topic from a study of "sustained extreme performance improvement," which tends to occur "where all the participants are deeply, deeply passionate about whatever they are engaged in.

"If you are interested in performance, we would argue you ought to be interested in passion," Hagel said. Social media has the potential to propel passionate performance because it's about building connections, he said, and Deloitte's research shows "passionate employees are twice as connected as non-passionate employees."

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