ROI and measurement


5 case studies — Social technology impacting management

We’ve tossed around a lot of ideas on {grow} about how technology is impacting our lives, but I’m also really interested in how it is impacting the culture of our companies.

For example, what is it going to be like leading a new workforce that is conditioned to manage relationships through text messages and accustomed to the continual stimulation and reward of video games?   As they enter the workforce, are they going to change our companies?  Or, are our companies going to change them?  Maybe a little of both?

The intersection of technology, Generation Text, and corporate culture will have vast implications for recruiting and retention, training, compensation, HR policies … nearly every company-employee touch-point in fact!

With this backdrop, you can imagine how interested I was to read a report from McKinsey on a competition they held to identify how Web 2.0 tools and technologies are changing management.  From 143 entries, here are five big ideas:

1. Sharing common resources more efficiently

Employees of the Dutch government are using web-based tools to share offices, conference spaces, and other resources. The employees were facing too many bureaucratic hurdles, and even had to reserve meeting space in their own buildings through an outside agency!  One particularly frustrated employee tweeted her exasperation to colleagues, and they decided to form a group to build their own reservation system with open-source software.  They rolled it ou,t building by building, and now the system includes more than 53 offices and 554 work spaces across the country. The employees say the net result is a “shift from the focus of individual ‘ownership’ as defined by specific government buildings and offices to a sense of ‘stewardship’ shared across the spectrum of government.”

2. Global training with local experts

Essilor International, a global maker of ophthalmic lenses, created an internal training program that mixes in-person and Web 2.0 formats to transmit best practices among 102 sites in 40 countries. The company says that a mastery level that once took three years to achieve can now be reached in about one.  A lens-processing center in Thailand, for example, developed a game to teach new workers how to understand the shape of a given kind of lens; now it’s used in Brazil too. A social-network feature enables coaching across multinational locations. The system is called “Entangled Talents” because the company said “the talents of individual employees across the globe have become entangled, creating a web that supports the company’s daily operations.”

3. Powering continuous improvement 

Best Buy has more than 1,500 locations and more than 100,000 employees on the frontlines of customer service.  In an effort to make sure that senior managers learn what those employees are hearing from customers, the company created an online platform that rewarded employee feedback on what they are hearing from customers.  The platform allows everyone to see collated information from all stores in a useful and searchable format. This information is powering a movement of continuous improvement that has affected things as simple as the signs in one store and as complicated as decisions about how to implement a national promotion.

4. Social networking for new product development 

Rite-Solutions, a software company, built an internal idea marketplace that has so far generated 15 new commercial products that account for 20 percent of the company’s total revenue. This system goes far beyond a typical brain-storming platform. The internal website connects potential new products with the resources, experience, and expertise that can bring ideas to life. The internal social networking site enables communities to organically develop to further improve, develop, and commercialize new product ideas.

5. Using internal communities to reduce time-to-market

The Mexico-based cement giant Cemex introduced an internal-collaboration platform called Shift, which has helped the company reduce the time needed to introduce new products and make internal process improvements. Shift uses a mix of wikis, blogs, discussion boards, and Web-conferencing tools to speed problem-solving.  When employees use Shift, ideas, suggestions, and  recommendations bubble up across the network. Communities of interest are form to tackle challenges common to their locations, markets, and skill sets.  Projects can move forward without the barriers posed by traditional hurdles, such as over-reliance on e-mail and live meetings. The payoff is lower cycle  times, faster time to market, and real-time process improvement.  The company has 500 active internal problem-solving communities.  An example: Cemex invited 400 employees involved with its ready-mix products to help figure out which worked best and which were redundant. The result is a slimmed-down product line offered in a constantly updated catalog available globally.

How is your company using social technologies and Web 2.0 tools to manage smarter?  Any case studies and successes you’d like to share?

Can you make money managing social media?

In a blog post almost two years ago about the best business idea for social media marketing, I made a prediction that I think stands up.  I said that there would be increasing demand for out-sourced social media management and content farms that would pump out low-cost, low value content in a Wal-Mart kind of way.

I’m not not saying this is necessarily recommended!  I just thought it would happen … and it is.  Now, here’s the next big question … can you make money managing social media for others?

My original prediction was based on a statement I heard at many companies: “Can you please just do this social media stuff for me?”

Of the course the purists will contend that everybody should do their own social media because of the “authenticity” value.  Certainly that is an ideal, but I’m also a realist. If people want to out-source their social media and there is a buck to made, it will certainly happen somewhere.   I also think there is some value to a consultant or agency helping people along for some period of time.  When you first got your driver’s license somebody still had to sit beside you and teach you how to drive, right?

In my job as a consultant, and especially in my job as a college educator teaching grad-level students from a variety of corporations, I see many approaches to social media management. Now, this is a short blog post and there are lots of nuances and exceptions, but IN GENERAL, here are some broad trends in social media management:

Mega brands – I can’t name names, but I have had a chance to witness some AMAZING and sophisticated social media marketing programs. These companies are beginning to make correlations between “share of voice” and true marketshare, using listening platforms to track micro-trends and the “cool kids,” and taking location-based marketing to a whole new level.

These companies have the resources to hire the biggest agencies and best minds in the world to help them navigate social media labyrinths and determine a strategy, but generally, they are organizing and resourcing to respond to the new opportunities. One brand has renamed part of their marketing department “Customer Connections.”

Medium-sized companies. I have a limited view of the world (of course), but I’ll be honest. Unless you are an elite brand, I believe at least 95 percent of the companies I see are desperately confused about what to do about social media.  I think they would just like for it to go away so they can return to having a trade booth at the annual conference in Las Vegas.

They probably don’t have a corporate culture that can easily adapt to the transformation needed to “listen” instead of “broadcast” and they simply want to check a box to do SOMETHING. You, know … I actually think there is some value in that.  A company that is at least thinking through the platforms, attempting to listen on the new channels and dipping their toe into content marketing is taking a step in the right direction.  Most of these companies at least have the vision and budget to hire an agency to get them started on social media marketing.

Small businesses.  As I wrote last week, I think social media can provide an advantage to most small businesses, but that doesn’t mean it actually does unless they are working on it!   Why isn’t it happening?

  1. They’re overwhelmed by the concept and don’t know where to start.
  2. They started a Facebook page and nobody “liked” them so they quit.
  3. They understand the concept but don’t have the time or resources to do anything consistent and meaningful.
  4. Their marketing budget is tied up in local newspaper and TV ads and they don’t have anything left for something new.
  5. When you bring it up, they stare you down and tell you they “Don’t need the Facebox or The Tweeter,” usually followed by “Dammit.”

Unless your customer falls into Category 5, they may be asking you to manage their social media program for them.  I see the following business models emerging:

Local support.  The new category of social media gurus are trying to teach best practices and perhaps do some hands-on social media management.  My take is that most of these efforts eventually fail because you are communicating for somebody else, which is probably not sustainable, and the labor cost to actually do this stuff is so high –and the results so undefinable in the short-term — that customers lose interest. People with a limited budget need this to work NOW.

Cookie cutter.  I am seeing a ton of people and small agencies offering social media packages — “our gold package features two tweets per day, a Facebook update, and one blog post per week!”  I truly despise this approach because it institutionalizes lazy marketing. But it is happening, a lot. I also forecast that most of these efforts will fail because at some point, the customer is going to wonder when all the new sales are going to start coming in from these two tweets per day they are paying for … and of course there will not be any. So this is a band-aid but I don’t see it working broadly.

Overseas.  Kind of a hybrid. Let’s solve the labor cost problem by hiring low-cost virtual assistants in Vietnam or The Philippines to do the tweets and blogs for us. I have a friend offering this to customers now and the VA can set-up WordPress websites so inexpensively he gives them away.  There are a multitude of problems associated with this approach but it at least addresses the labor issue.

Coaching.  I think the only viable long-term solution for most small businesses is to get some coaching.  I have successfully taken this approach with several clients. They buy an hour or so of my time each week and we methodically work on a step-by-step plan to eventually create a culture, an organization, and an actionable strategy appropriate for the company resources and budget. This seems to be the approach that will work best. It is not fast (and a lot of people hate that! ) but it does slowly integrate these practices into the fabric of the company, get real employees involved, and become a natural extension of their sales and marketing strategy.

I know it’s a big world and there are probably lots of other advances and models around.  What are you seeing?  What’s working or not working? Have you found a way to monetize social media management?

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Blogging world flipped by AdAge Apocalypse

I woke up Thursday morning to a shocking development. My ego had been knocked down 60 pegs.

On the right hand column of this blog there is a fancy orange badge naming this site as a top marketing blog, as determined by AdAge magazine. Last week, the organization changed its magic formula to upend a rating system that I, and many other bloggers had depended on as relative sign of the success of our blogs.  In a recent podcast, Mitch Joel recently told me it was the only metric he follows every day, for example. Gini Dietrich posted that she was “really pissed” by the changes.

The system was far from perfect, but if you looked at the results … yeah, they seemed about right.

The AdAge rating system depended on five variables that blended together in a secret sauce to come up with a numerical score. Two of the most meaningful factors, PostRank and Collective Intellect discontinued the availability of their API (raw data source) and had to be replaced.

Post Rank was the most important component, I thought, because it seemed to be an indicator of strong content. It considered how your article had been shared, the level of engagement through comments, and if other people wrote blogs about your blog.

These two important measurements have been replaced by feeds from Facebook and Twitter. To give you some idea of the impact on {grow}’s rating, my PostRank score was 47 out of 50 points … my Facebook score is a 1.  I don’t know why, but it is what it is.

This change had a cataclysmic effect on the rankings. Some blogs moved up or dropped down by 200 places or more!   Many of the changes make no sense at all. For example, one blog that is more or less in my “old” position has not been updated since 2009.  What’s that supposed to mean?

It looks to me that losing these two key scores has made the AdAge ranking virtually meaningless.  However, I’m not arguing from a position of strength since I was one of the big losers in the chaos!

My reaction to this was embarassing. At first, I was shocked and angry.  I spend a lot of time telling people NOT to worry about the numbers and just do great work … and here I was worrying about the numbers!  I was pissed off at AdAge and I was pissed at myself for feeling so strongly about it.

I think this pokes about at a recent theme of this blog — social proof and the fact that oftentimes on the social web a numerical rating provides a more important symbol of accomplishment than actual accomplishment. But this time it really hit home. Even if it’s a fake badge, the business benefits of being on the list can be real.

Now I had fallen into the social proof vortex, even though I’m supposed to know better!   Arrrgh.

At various times during the Day of the AdAge Apocalypse I would catch myself being angry about the shift only to self-correct and remind myself that nothing really important in my life had changed. This Jekyl and Hyde routine continued about once an hour all day.

As high-minded as I would LIKE to be about this development, I can’t deny that this little report card meant something to me. I work so very hard to make {grow} an interesting, relevant and entertaining blog and I felt like I got bitch slapped. Just being honest about it.

I’m a little more calm about it now. I know I need to be focused on “real life” … but my blog has become real life too, hasn’t it?  This whole thing feels like your business credit rating being determined by freaking Facebook or something.

Anybody want to weigh in on this?  Slap me back to reality? Take your best shot baby.