Michael Fauscette

Social, Mobile, Cloud...Table Stakes for Today's ERP?

I spent the past week in San Francisco attending Netsuite's annual user conference, SuiteWorld. As with most software conferences there was the usual barrage of announcements including new features, new partners and refined strategies. Of course SAP also held its Sapphire conference at the same time, so you may have had a hard time making it through all the announcement noise to see what was important from Netsuite (I'll leave the SAP Sapphire commentary at this point to my colleagues).

In the Cloud ERP arena Netsuite, the first full SaaS ERP system, continues to raise the competitive bar and deliver key functionality to its rapidly growing customer base. Last year at its first SuiteWorld conference Netsuite articulated a strategy that focused on several vertical variants and started to move up market from its lower mid-market roots. The move up market involved a repositioning of the suite for the upper mid and lower enterprise combined with a two tier strategy for the largest enterprise prospects. All of these strategic moves are paying off but the two tier strategy is proving to be of particular interest and is an area of significant growth. This approach supports the concept of keeping the current core ERP systems intact, a choice that most large companies have made, and giving departments / divisions / operating units more modern, flexible, and feature rich systems through the use of cloud based ERP that operates the local unit and consolidates up to the "main" corporate system. This is one obvious way to "fix" the aging and unpopular user experience of the aging core ERP systems while minimizing the overall cost structure and leveraging past capital investments. As an example of this approach Land O'Lakes announced that it is implementing Netsuite OncWorld in this two tier model.

On the mobile front Netsuite has taken a very realistic attitude that is focused on providing the complete user experience on any device. According to Netsuite CEO Zach Nelson mobile support is "table stakes" for modern ERP systems with customers demanding access from any device at any time. This includes tables and smartphones across the major OS variants.  Currently Netsuite offers a wide range of mobile functionality and supports IOS, Windows Phone and Blackberry.  

One of the most interesting announcements during the week was around a new product offering called SuiteCommerce. Netsuite has long offered a strong set of eCommerce features that are popular with its customers.  Commerce and the underlying platforms are under pressure to provide new capabilities that help companies deal with customers that are increasingly mobile, involved in the social web and increasingly insist on a consolidated experience that pans all interaction points. This customer revolution is not just about business to consumer (B2C) either, business to business (B2B) is feeling the same types of pressure. In the past systems were built to support cross channel commerce, that is, interacting with customers in many different siloed channels. The problem of course, is the silo approach. Customers are expecting an integrated experience that spans all channels, something that some have called multi-channel commerce. That doesn't go far enough though, IMO, because its really about eliminating the concept of channels and interacting with the customers across any/all touch points, B2C and B2B. In our predictions this year we included one about the growth of digital commerce, something that we started tracking over the last few years.

Netsuite's new commerce platform, SuiteCommerce, moves from its eCommerce roots and into the next generation of commerce solutions that work to provide this integrated commerce experience across any touch point on any device. Its important to note that Netsuite's approach is completely integrated across its entire ERP system and not just focused on the customer experience (CX) front end. Not to minimize the importance of CX, but frankly if a business can't fulfill an order it doesn't really matter how good the experience of interacting with the business was, it is still a failure. The combination of a solid commerce "back-end" with a flexible CX offering, referred to as commerce as a service (CaaS) by Netsuite, can provide significant value to Netsuite customers. SuiteCommerce is available now in two editions, one for mid-market and one for enterprise. Among early adopters the Girl Scouts of USA announced that it is moving its commerce operations to the new Netsuite platform. From a competitive view, there aren't really any strong contenders except in the large enterprise where both IBM and Oracle are making strong moves into this next generation of commerce platform.

At SuiteWorld last year, Netsuite announced its approach to socializing its applications would be through partnering with best of breed solutions and integrating through a social API rather than building its own social offering. Some of my colleagues have criticized Netsuite's social story, but in my opinion this was a smart move. It is critical to provide a system of relationship across the enterprise, something that Netsuite does effectively through its partnership with enterprise social network provider Yammer. Netsuite expanded it's social footprint last week by adding Box to its list of partners. The addition and what looks to be deep integration of the two products, provides Netsuite customers with  a strong collaboration and file sharing solution that complements the social and collaborative features of Yammer.

Today's ERP then is social, mobile and in the cloud. It also extends into a full feature commerce platform that can help companies retool and move away from cross and multi channel commerce, and start to provide an integrated commerce experience whether they are B2C or B2B.

Tags: Netsuite, SuiteWorld, ERP, SaaS, cloud, CaaS, commerce, Yammer, Box

From Big Data to Smart Data: Supporting Critical Business Decisions

Last week at Lithium's LiNC event I did a session on big data with Lithium Principal Scientist Dr Michael Wu. It's always a pleasure working with Michael, the session was well attended and the audience was very engaged. Since then I have been thinking about what we presented and I think there were a few key points that are very important in understanding how businesses can start to make use of data to support business decisions.

First I should bring back out a system model that I'm using to represent the three basic systems that we need in the enterprise today; systems of transaction, systems of decision and systems of relationship. It's important to understand the three systems, how they're different and more importantly how they are interrelated.

Systems of transaction are the application foundation for the modern enterprise. They are designed to automate routine business processes and support business transactions. They are also the source for most of the structured enterprise data. Systems of relationship are the new social solutions that enable peer to peer collaboration, content sharing, and community. The systems are used to connect employees, customers, partners and other stakeholders together and to content, data and other enterprise systems.

The third system, decision, represents the evolution of analytics and business intelligence from specialty tools that could only be used by specially trained analysts, to a system that puts analytics into the workflow, in context and as an end user tool. This concept is very important, the move from a system used by a few to look at history, to a system that is integral to the decision process. Systems of decision move information to the "right" person, at the time of need and in a work context.

So how does big data play into this decision system concept? Big data is a hot topic and according to IDC last year alone the world created ~1.8 zettabytes of new data growing by a factor of 9 over the next 5 years. The other part of that story is that much of the data is unstructured, which creates its own set of issues. Now on the face of it, it does seem that with the mountain of new data growing at a staggering pace that businesses must need to "do" something with it. The problem though, is exactly what to do? Just because the data's out there, and no doubt it's big, doesn't make it relevant, consumable or more importantly actionable. Data minus context can't be turned into usable information. There's also the problem with redundancy, a lot of data is redundant, and therefore isn't important even if you can add context and relevance.

Data is useful and actionable only if it's of interest to me (relevant) at the specific place and time (contextual) of use. The rest of the pile of "big data" is then, not of interest to me at all. The usefulness of big data is individual to a specific place / time, in the context of a specific issue or problem; or in other words, one person's signal (actionable data) is noise to someone else. Some of the data then is useful and of interest but you must know what questions to ask, for whom, and when and where it will be of use to solve a specific problem or issue, otherwise, big data is just dumb data.

So the real challenge for systems of decision is to turn the dumb data into smart data, or maybe more accurately, information. Systems of decision have to provide relevant, useful, actionable, intuitive, digestible and interactive information to the right person at the right time. The next generation of analytics are systems of decision that can provide the relevant information to every system user, in work context, to make smart business decisions. Here's a socialytics concept from Michael that fits this smart data / system of decision model:

Tags: big data, smart data, lithium, LiNC, socbiz, community, SCRM

Connecting the Enterprise: The VMware - Lithium Technologies Partnership

Companies today are under increasing pressure to change the way they interact with customers and community management platforms like the one provided by Lithium Technologies can be an important part of that initiative. With customers insisting that companies interact "when, where and how" the customer chooses and not, as in the past, only where the company chooses, customer support is more important than ever. Because of this, many companies are opening up social channels to their customers. Now these Social CRM efforts are definitely business critical, but in my opinion there's an associated issue that some companies are overlooking, their own siloed organizations. As I often tell audiences, just opening up channels to the customers without making sure their own employees can actually collaborate with each other is a recipe for disaster. I'm not saying one initiative is more important than the other, but they are in fact halves of the same process. Building a collaborative and connected business is more than opening up the conversation with the customer.

Last week during Lithium Technologies' Annual Conference LiNC a partnership with VMware's Socialcast was announced. Socialcast, an enterprise social network product I've written about a few times (here and here), provides the platform for connecting employees. Using Socialcast's Reach integration platform customer conversations and interactions from Lithium communities can be brought inside the Socialcast network, allowing employees to interact with customer ideas and feedback. Combining the enterprise social graph with the external customer social graph brings customer insights to internal experts to drive real time business decisions. This starts to move systems of relationship together with systems of decision to elevate the ability to make critical business decisions. Since Lithium communities connect out to public social networks like Facebook and Twitter, the enterprise network that is created by the two integrated graphs has very broad reach and is one step closer to becoming a networked business.

Tying companies together inside-out and outside-in is a key part of becoming a social business. Integrating the two platforms is a good step forward to doing just that, and should provide considerable business value. Socialcast enterprise social networks bring employees together with content, data and enterprise systems, Lithium communities bring customers together and open up a real time conversation. Bringing the customer conversation into the enterprise social network provides critical information that can lead to better and more timely business decisions and a more effective and innovative business strategy.

Tags: SCRM, enterprise social network, socbiz, customer, employee, decision, social

Real Business Transformation

I managed a few minutes out of my schedule last week to stop by the Yammer Tour event in San Francisco. I was in San Francisco doing a keynote for sugarCRM's user event and luckily the events overlapped. As I was listening to Yammer CEO David Sacks talk about some of the new Yammer features and interview some customers, I was struck by how much social tools like Yammer are changing businesses. Yes, I know that's almost all I've talked about for the last 4-5 years, changing businesses with social technologies and driving real cultural changes, but seeing that transformation really makes an impression. It's easy to get lost in all of the forward looking research and discussion on technology when in fact, what really matters is what businesses are actually doing with the tools to get some real business benefits. Does using social tools for business really make any difference? There are all sorts of ways to measure value when it comes to technology, we wrote a whitepaper on the ROI of social that has some ideas. Social business impacts business processes across the company and is having some interesting and very positive returns. Not all are as obvious as others though, and some of the less obvious are perhaps the most transformative.

First I should say that for me, social initiatives need to be clearly tied to increasing revenue, increasing margin, fostering innovation and/or increasing quality to be meaningful and successful. We are trying to run businesses and investments must return value or there's just no point in making them. Think about it, why is building a knowledge sharing culture and implementing a people-centric collaboration system / employee social network valuable? Well, for example getting the "right" information to a sales representative at the "right" time helps close more deals, which in turn increases revenue. Or increasing employee productivity, something that our survey respondents recently reported increases in the range of 11-30%, increases margin (and maybe quality and innovation as well). Implementing an innovation management system and process can increase innovation, and perhaps get better products to market faster which increases revenue (and maybe even reduce the costs of capturing customer input and feedback, which increases margin)... I can go on, but you get the idea. I've looked at a pile of interesting social business case studies over the past year.

Direct, hard ROI is critical to the success of social projects but that is not the only benefit to changing the culture, at least from what I'm starting to see from my discussions with companies that are using these new technologies.  During the Yammer event the CEO of the grocery store chain SuperValu, Craig Herkert, shared how the company is using Yammer. Of course the obvious benefits of collaboration in a distributed organization are playing out for them, for example connecting associates from different stores opens up sharing of successful campaign and ideas in ways that simply would not be possible without the real time connectivity that an employee social network / activity stream provides. In a traditional organization information generally only flows in very predictable directions, down from executives, up from satellite organizations or across in each satellite. Information flow like that is easy to control. Opening up uncontrolled, multidirectional communications changes the dynamic of the flow of information completely. So how transformational could this be? In the SuperValu example Herkert shared how he uses Yammer to get connected to associates and stores by reading and interacting with the real time flow from over 100 stores and thousands of people. Not in a filtered flow up from his direct reports or store managers, but directly from the employees on the floor in each store. It obvious to me that getting associates in stores across regions to help each other solve problems, share successful ideas, etc. would impact revenue, margin, innovation and quality, I mean just opening up local issues to the collective problem solving abilities of thousands would have a huge impact. What's maybe not so obvious though, is the power of this new connectivity for executives like Herkert. Having the CEO and other top executives intimately involved in the conversation is a powerful change agent for building a collaborative culture and a collaborative culture is transformative.  

Oh, and in case you're interested let's get back to the Yammer announcements. One of the interesting phenomena that is developing from social network tools like Yammer is the evolution from the old, outdated concept of the corporate intranet to a dynamic employee social network empowered by social collaborative tools. Yammer announced a series of new features and functions this past week that move their solution solidly along that path. The announcements included:

• Enhanced mobile apps with many new features
• Yammer Universal Search
• Premium Groups which provides deep team workspace functionality
• External Networks
• Yammer integration including Microsoft SharePoint, Yammer Embed (more on this in a future post), Yammer Connect Login, etc.
• Features from the recent oneDrum acquisition including Sync and Co-create (for more information see my post)

I'd love to hear what you're doing with social tools to transform your business so please share. I'll post some other case studies in the near future.

Tags: socbiz, collaboration, ROI, case studies, Yammer, value, innovation

"Late" to the Cloud?

It's a statement that I hear often lately, as more traditional software vendors start to invest in cloud computing, that they're "late to the cloud". Of course many of those who are saying it are "pure play" SaaS vendors that are no doubt starting to feel some competitive pressure as more vendors start selling SaaS applications. I also hear it from colleagues and I suppose that it is a true statement of fact but to me there's a little more to the story than that. I think the bigger question might be whether being late to the cloud is "bad".

The general perception is that being early to market with a product gives the vendor first mover advantage and lets them capture market share and mind share before any competitors get into the game. There's certainly a lot of evidence that this advantage does play out for new products or sometimes even for businesses. SaaS isn't really in the strictest sense a new product though, it's a new business model and a new (well it was new, now it's over 12 years old) way to deliver software. The first movers were companies like Salesforce.com and Netsuite, companies that led the innovation and helped define the model. Unlike a new, innovative product though, the move to establish SaaS as a viable way to consume software wasn't an immediate run-a-way success. It took many years to convince mainstream IT to support the model and to get past their security and scalability concerns. As a part of the wild west days of SaaS, these new vendors developed the methods of delivery, the architecture and the business model. Things like multi-tenancy, which clearly has scalability advantages for the vendors, became the defacto standard for SaaS. Initial success in the marketplace, particularly for Salesforce.com, Taleo, SuccessFactors, and Ultimate, that is vendors that offered a compelling product for a specific set of end users, was mostly driven around corporate IT, not with it. The exception would be Netsuite, but in its case, the initial success was in the small and lower mid markets where the need and advantages far outweighed the objections.

By 2007-2008 the SaaS model, and cloud computing in general was getting a lot of attention and was starting to get more mainstream adoption, which even included support from more progressive IT organizations. It had not however, reached the tipping point for mainstream adoption. This tipping point, I believe was accelerated by the economic crisis of 2008, which forced companies to look at cloud computing, particularly SaaS, as a viable alternative to traditional software purchase. This was an economic decision, traditional software is purchased out of the capital budget while SaaS, with its subscription pricing model, is paid out of the operating budget. Part of the crisis was in fact the drying up of capital for many businesses, particularly financing for capital projects, so it became much easier to go with a SaaS product or nothing at all. Software is an important competitive advantage for many companies, particularly in this new social and hyper-connected business environment, so choosing to not invest in key projects like social CRM, employee collaboration, process automation, decision support and deep vertical industry functionality really wasn't an option. So in that 2008-2010 timeframe SaaS crossed its tipping point.

Now look at traditional software vendors like Oracle, SAP, Microsoft and a host of midsize and small vendors. Their businesses were based on a very different revenue model, the combination of up front licensing fees, services and ongoing yearly maintenance fees that give customers access to product support and upgrades. Moving from this model to a subscription model is not an easy shift and one that most effectively is managed over a long transition period to create a smooth swap in revenue sources. There have been companies that made the switch in one bold move of course, but those stories are few and were fueled by other business pressures and issues.

Which strategy would you choose, rapid change over but risking current revenue for long term subscription revenue or a slow transition that only starts when it's obvious that the model is the future of software? First I should point out the scale of the issue, we're talking tens of billions of dollars, not a few million for the larger vendors. It seems pretty simple to me, I'd protect the largest source of my current revenue as long as possible and then add in the new sources as they proved themselves as viable. Cloud is clearly a different way of delivering software, or a different mindset over a traditional product license model, but is it really a different type of "DNA" from the traditional business of the software vendor? It certainly requires a high level of customer service and customer focus, but many of the traditional vendors already have the kernel of this attitude in their service and support organizations.

So if you're a vendor in the later wave of rolling out cloud based software products how do you gain momentum and build a product portfolio? Can you buy your way in or do you have to move your current products over to the new model? For many traditional products, the move into a SaaS model requires some fairly significant re-architecting to make the products viable as SaaS. Now some vendors have simply offered existing products as hosted offerings and moved to a subscription based licensing approach. This has the advantage of quickly getting the vendor in the market but it comes at a price to both vendor and customer. Like most things in business there isn't really a "best" one answer, but in fact a blended approach seems to be the most obvious choice, particularly if you're a larger vendor. Building some new products on a native cloud architecture, while time and labor intensive, will yield some excellent long term benefits. That doesn't preclude buying market share and expertise though. We've seen an aggressively consolidating software market over the last 6-7 years, with generally successful outcomes for the vendors and customers so repeating this with SaaS vendors is a natural continuation of the trend.

Consolidating current existing SaaS vendors into a broader product portfolio has some obvious benefits and some challenges. It increases the ramp rate for the acquirer, bringing more mature SaaS products (at least that would be the general assumption) with existing customers, a trained sales team, developers, operations staff, consultants, and product support expertise. For customers they most likely benefit from a relationship with a more stable vendor with more resources, potentially greater geographic reach and access to other product assets in the portfolio. The down side for the vendor can include the efforts to rationalize products / infrastructure / platforms, etc. that comes from adding products from multiple vendors. Re-platforming efforts can be expensive and/or complex. Integration into the existing product portfolio can as be challenging although it is generally a very important part of the post acquisition process. From a customer perspective there's always some fear of vendor lock-in as there are simply less vendors to deal with due to consolidation. I hear lots of discussion around this topic but frankly more from other analysts than from vendors' customers so maybe this is less of an issue / concern than some people believe.

Building new SaaS products (and perhaps moving existing products as well) now also comes with some added benefits. The original SaaS vendors are built on platforms and architectures that were defined and built over 12 years ago and while they certainly have been improved and modified during that time, they are getting old in technology terms. Look at what I'd call 3rd generation SaaS product architectures versus the 1st generation for example. Taking Workday as the most obvious example of 3rd gen, you can see many improvements that the older platforms simply don't have, in-memory technology, for example. So moving / building now means the vendor can leverage newer and more modern architectures and technologies, including virtualization, which was nonexistent when the 1st gen products were designed. Many pure SaaS evangelists will call my next statements heresy but traditional vendors that are getting into SaaS are also offering customers choices in deployment models, as they can build products that are capable of being deployed both on premise and in the cloud in multi and single tenant virtualized models with the capability of moving from one model to another in the future. To me this just seems like goodness for customers, but I'm sure I'll draw a few stones over it. One of the key objections I've heard to this choice model is the frequent release cycles that SaaS vendors hold to versus the much longer cycles of traditional software. The longer release cycles are due to a couple of things, the development model (usually waterfall) and the tolerance of on prem customers to upgrade cycles, which need to be longer since most companies couldn't tolerate more than an upgrade every few years. There are ways around these issues though, and we're starting to see wide spread adoption of agile dev models and efforts by vendors to sort out a way to provide frequent upgrades to the SaaS customers while giving the on prem customers ways to package up / save up upgrades to be implemented on longer cycles. This does lead to the old issue of supporting customers on multiple releases but if the vendor is willing to bear this burden (and can do so at little or no damage to the overall bottom line) then its none of my business to criticize them.

We're in a transition period for customers and for vendors. There's no magic switch to move vendor products and customer implementations to the cloud, it will take many, many years for that to happen. During the transition years giving customers options and choice seems like a very good thing to me. There are lots of advantages to moving to the cloud and companies are realizing these benefits but at the same time, many do not, or will not, move everything. For companies that have a substantial investment in core on prem systems that currently meet their needs, they will continue to operate those systems for the foreseeable future. When they add new systems, most will choose to do so in the cloud and integrate those to on prem systems as needed. Operating in a hybrid model is simply a reality for now...and that extends to many vendors as well.  So was being late bad, or was it simply "fashionable"?

Tags: SaaS, cloud, software, vendor, business model

Yammer Acquires oneDrum

Yesterday Yammer announced its acquisition of real time sync and desktop collaboration vendor oneDrum. This is Yammer's first acquisition and one that significantly increases Yammer's depth in facilitating social collaboration. Yammer provides a popular employee social network platform that is sold in the freemium model and has until now, expanded its footprint through a series of strategic partnerships that most recently include Ultimate Software. In these partnerships Yammer forms the social backbone or system of relationship for other key business systems from ERP to HCM.

With oneDrum Yammer adds seamless real time synchronization from any yammer connected device and a very important set of collaboration functions. One of the most difficult problems in the emerging collaborative enterprise is facilitating joint work around a document, spreadsheet, powerpoint, etc. Often teams try to use email as a proxy for a collaboration solution, which is definitely sub optimal and often ends in frustration caused by a versioning nightmare. Content management systems have tried to help with this problem and while they are fine with versioning they are not adept at the actual process of collaboration, that is, getting people together in real time to "do" the work. The only tool in widespread use that I've seen so far for this activity is Google Docs. Now while the functionality is excellent there are many inherent problems in using a consumer tool inside the enterprise, not the least of which is that it is generally being done with out corporate IT knowledge and with a high degree of IP and security risks. Of course some companies do use Google Docs as an approved enterprise productivity tool, which removes the security issues, but does not provide an integrated social experience. Yammer + oneDrum solves the security issues AND provides an integrated social communication and collaboration tool, with joint, real time work capabilities all integrated into the companies social network. The new features, which will be available this summer as a client download (no Microsoft Office plug-in required), will include:

• Sync: Access Yammer files through a desktop folder that includes a sub-folder for each Yammer group.
  • Users can drag and drop files into the shared folder to sync with all group folders
  • Shared folders are automatically provisioned when a user joins a new group and disappear when the user leaves (or is removed from) the group.
  • Users can open files from the Yammer desktop folder and work on them in their native applications all with real time automatic sync. This includes offline capabilities as well.
• Find: Each Yammer file lives at a unique URL (or permalink) where it can be viewed in the browser, followed, shared and discussed including automatic notification of changes. This works across any Yammer supported device
• Real time Collaboration: Employees can work collaboratively inside a Word, PowerPoint or Excel file added to the Yammer desktop folder.
• Security: Data in motion will be encrypted using 256-bit SSL/TLS and data at rest will be encrypted using 256-bit AES. Content can be marked read only and there is a version history. Viewing permissions are based on group access, so when a user is removed from a group or network, access to files is revoked accordingly.

This is only the first round of functionality so it will be interesting to see what else can be done with the integrated products after this summer's release.

Tags: yammer, collaboration, oneDrum, team, socbix, social business, enterprise

Responding in "Social Web" Time

When we talk about the impact of the social web, social business, social CRM, consumerization of IT...almost anything that has to do with the changing business environment, the topic that universally comes up is the change in people's expectations. This applies to employees, who want a user experience for the enterprise that is as "good" as their personal web experience and who want devices that provide the best and most modern functionality. For collaboration they are either provided modern people-centric tools by their company or they work around IT and use consumer tools that more completely meet their needs (although arguably not always the needs of the company when it comes to security and IP protection). The list goes on, and on and is both a great opportunity for business and a challenge for IT and older paradigms of "control".

As far as customers are concerned the reality of changing expectations is having a big impact on companies and on the way they interact and deal with customer needs. When the web saw its first wave of growth (you know, way back in the 1990's), companies treated the web like electronic billboards and brochures. Soon though, companies learned to use the web as a transaction conduit, a new distribution channel that is global and always on. It created distribution potential of tremendous value, just look at Amazon or Ebay. Today no merchant of any size would consider not using this great distribution network, which gives small, local businesses global reach. After the transaction web though, the web evolved more and we are now in the "social web" phase, where people learned that the Internet could provide a media platform and a way to interact and build global networks of individuals. It's really about channels again, new media channels and new relationship or interaction channels. I talk a lot about the three "C's" of social business, content, collaboration and community; these three C's all come from the new channels opened up by the social web.

Traditional consumer behavior is changing because of the web. Individuals are using new ways of finding brands and making buying decisions; moving away from traditional advertising and from using company sponsored information to relying on new media and trusted networks. Companies that are used to "controlling" their message by controlling the channels through which is flows and the content are learning that in this environment that is much more difficult if not impossible. These new channels provide content that is outside of the companies control / influence and open up communication channels that are not only outside of the companies control but in many cases unreachable by the company with out a significant change in the way things have "always been done".

The social web has some key characteristics that are impacting expectations, for example it's real time, open , interactive, has global reach, empowers the individual and is controlled from the end points, the individual. This creates some challenges for businesses and some opportunities. I read this article recently from CNN on a study of which companies respond fastest on Facebook (or not at all). Now most major brands (and a lot of minor ones too) have given in to the idea that they need a presence on important social networks like Facebook. Often they have built this presence with a lack of understanding of the expectations of their customers. Now don't get me wrong, I agree that you need to be on Facebook, but there are some very important things to understand about what that means. The study referenced by CNN, from STELLAservice.com, a company that rates customer service of online businesses, showed that one out of four companies failed to respond to customer service inquiries on their Facebook pages and that even less responded to comments posted there. As an example of best practices B&H Photo responds to wall posts in about 2 minutes. Footlocker, Williams Sonoma, Sur La Table and Bed, Bath and Beyond all respond in under 30 minutes, and the overall average of companies that do respond is under an hour. On the opposite end of the "best practice", brands like Victoria's Secret, Radio Shack, J Crew, and One Kings Lane didn't respond in two days.

Changing expectations mean that businesses have to learn new ways of interact with customers, new channels and new paradigms. There are 2 key areas for businesses I think, up front and down stream or before / during the sale process and after the sale support.  Companies need to move beyond the marketing message, which is not what these new channels are fundamentally about. Not that there aren't some great marketing opportunities but often in this new world customer service is the new marketing. Meeting customers when, where and how they choose and in the time frame that maps to the social web environment is critical. An hour or two is a long time in a real time culture, two days, that's ages. Remember, it's a community not another broadcast channel, so be a contributing member of that community, add value and engage in a conversation...and in "social web" time.

Tags: web 2.0, social web. SCRM, customer service, Internet, facebook, conversations, expectations, employees

Yammer and Ultimate Software: Building out the Enterprise Social Network

Last week Yammer and Ultimate Software announced a partnership that combines the Yammer enterprise social network with Ultimate's UltiPro HCM. Combining the deep employee profile from the corporate HCM system with a real time social collaboration tool is an important step in building out a complete enterprise social network, connecting employees to each other and to partners and customers. A modern HCM system contains critical workforce intelligence that starts with recruitment and includes job history, compensation and payroll, performance, skills / talent and career development data...all the relevant employee transaction data (system of transaction). The system of relationship, or social network, has connection data, interaction data, important clues to interests, skills and competencies, as well as organic performance data. The integration and interaction of the two systems forms the core of the complete corporate network.

Specifically in this case the two companies are starting by releasing the first phase of the integration this Spring and continuing to iterate and increase functionality with subsequent releases. In 2012 the roadmap includes:

• Single sign-on from UltiPro to Yammer
• Cross-posting and messaging between the two systems to include auto posting job openings and administrative alerts and actions into the Yammer activity stream
• Work milestones: the ability to tag accomplishments relating to individual, team or company goals in Yammer and have that accomplishment captured in UltiPro's goal management module.
• Capturing recognition from the Yammer stream into the UltiPro Performance Management
• Team collaboration: provides managers a filtered view of their team's collaborative actions and activities from Yammer in UltiPro Talent Gateway 

 The overall concept, tying together the collaboration and communication activities with the performance management system and the employee data seems like a natural extension of both systems as companies become more open, collaborative and more people-centric in the way that work gets done. The systems of relationship have to be integral to the systems of transaction and systems of decision as the enterprise matures.

Today we're seeing social collaboration tools, and the subsequent networks that are created by the tools coming from several different directions. Some systems of transaction are building networking into the fabric of each system, a trend that will no doubt accelerate as companies learn that collaboration happens at the point of work, not off in a different system. Collaborative work is about getting the right people, data, content and systems together at the right time, in the work context. The systems have to facilitate that to be relevant. What's happening is that different networks are growing up around different types of systems and tasks. At some point these different networks have to be tied together into one broader system of networks. The systems of relationship can form the link between the networks, both internal and external. In the new networked business model that is evolving there really are a series of interconnected networks that interact in different ways depending on the work context. This Ultimate - Yammer partnership is a great example of the movement towards this new network of networks.

This is starting to happen around several vendor systems. Yammer's partnership last year with Netsuite is another example of the evolution and connection between transactions and relationships. Salesforce.com has similar partnerships that use Chatter as the connecting network, including Workday, FinancialForce and Infor as well as all of the other Force ISV's, who get access to Chatter through the platform. Oracle is doing something similar with its new Oracle Social Network (OSN) product and the network at work in the Fusion HCM modules. OSN could be the system of relationship across all of Oracle's product portfolio. Another example is IBM's partnership with SugarCRM, which ties IBM Connections (the system of relationship) to the CRM / SCRM suite.

To me this move toward integration is the next step in the maturity of social enterprise solutions. While functionality to facilitate relationships are critical, they really only start to provide their true value when they are tied directly to the systems of transaction and systems of decision. This blending is the start of the move to the next generation of enterprise platforms, which are inherently social and support real time decision processes in the work context.

Tags: ocial business, SCRM, socbiz, social enterprise, Yammer, Ultimate, HCM, Oracle, IBM, Salesforce. Chatter, OSN, SugarCRM, collaboration

Social Government?

I spent time last week at an IBM / Federal Computer Week Social Business event for the Federal Government. I tend to focus most of my time researching commercial uses of social tools, not public sector, so I was very interested to hear what government agencies were doing. In addition I hoped to get a better idea of cloud adoption among federal agencies, particularly since there is a mandate for agencies to make greater use of cloud computing both to save money and to close the technology gap with private sector. I have to say, particularly around the use of social tools, that I was surprised how far some agencies have advanced. There's still a long way to go of course, but I did see some novel and creative use cases during the day. I'm sure that the Obama administration, by setting a strong example of technology adoption and use, has a lot to do with the rapid change in some agencies through adoption of social tools and concepts.

After an opening keynote from IBM Social Business GM Alistair Rennie, the agenda moved to some examples of what agencies have actually done with social tools. Malcolm Jackson, Assistant Administrator and CIO of the Environmental Protection Agency (EPA), presented on designing an effective collaborative environment in a government agency. The EPA is embracing social in both internal and external use cases and is particularly active on public social networks as a means of constituent outreach. Culturally the EPA is building on the concept of knowledge sharing and collaboration as a means to become more transparent and more effective. The EPA started actively blogging in 2007 with Greenversations and now has five active blogs and seven discussion forums where it actively engages its different constituents. On the EPA web site there are podcasts, RSS feeds, widgets and links to social bookmarking sites throughout the site for content sharing. On public social networks the EPA is active on Twitter (the EPA Administrator, Lisa P. Jackson, @lisapjackson, is participating with the White House in a Tweetup about women and the environment on 3/26 - #SheGoesGreen) with 23 official handles, Facebook, YouTube, Flickr, and Challenge.gov. 2012 is the 40th anniversary of the Clean Water Act and to raise awareness on water conservation the EPA is running a campaign all year that is centered on a Facebook page. As an interesting side note, Jackson also shared that he had just issued a directive that all software tools developed for the EPA must be developed for mobile first.

As I was researching for this post, I can across this timeline of the US governments use of social media:

U.S. Government use of Social Media on Dipity.

  

In fact there's a whole web site of resources to help agencies with their use of social tools to engage constituents, HowTo.Gov.

Another example comes from a much maligned agency that definitely needed a way to change its public brand, the Veterans Administration (VA). As a veteran myself I can tell you that the VA has a lot of bad "press" to try and overcome but happily it is embracing social tools to help with this battle. Joining the summit to talk about what the VA is doing with social collaboration was Brandon Friedman, Director of Online Communication, Department of Veterans Affairs. Mr Friedman tells a story that is growing more common among public and private sector of how social tools can help drive culture change and influence public opinion. On June 28, 2011 the VA issued Directive 6515 on the USE of Web-Based Collaboration Technologies. With this directive all VA employees are strongly encouraged to use social tools for information sharing inside and outside the VA and to facilitate collaboration, outreach, and communication at the VA. According to the directive these collaborative tools include social media such as wikis, blogs, mashups, folksonomies, Web feeds (such as RSS feeds), and forums (such as Facebook), and other collaborative tools (enterprise social software like IBM Connections, Yammer, VMWare SocialCast, Salesforce Chatter, etc.). The VA started using social media in 2009 and now has all 152 medical centers with an active Facebook page and Twitter feed, two blogs (VAntage Point), a YouTube channel and a Flickr page. Over 300K VA employees are using social tools to reach out to veterans and communicate about VA services. The VA also created Web communications offices, content managers and collaboration service coordinators at all VA facilities and organizations. According to Freidman 40% of the veterans who use the VA's Facebook pages are over 45 and only 9% are younger than 25.

In a very high profile way in 2009, the US Marines banned the use of all public social networking sites for all active duty Marines unless a mission-critical need exists (I wrote about it here). According to Gunnery Sgt. Robert Piper of the DoD's USMC/Defense Media Activity, the Marines learned a lesson that many businesses are also learning, you can ban social networks but that ban does not stop their use. In fact if you think about it, a deployed Marine is a natural user of social networks to stay connected to family and friends. The Marine Corps has now lifted the ban and is embracing the use of social tools by its soldiers. With a policy in place and all Marines trained on the proper use and operational security issues, the Marine Corps is finding that the social tools have improved morale and greatly enhanced the ability to communicate both for official and personal reasons. Gunny Piper said that Google+ is very popular among Marines, particularly the hangout feature. One program that the Marines put in place using social tools sets aside time for a deployed soldier to video chat with their young children every week on a Marine sponsored device.

On the cloud front, it seems that more and more agencies are deploying applications in the cloud both in government data centers and in data centers from companies like IBM and Amazon Web Services. Security is of course a big concern for government agencies but a new regulation, the Federal Risk and Authorizations Management Program or  FedRAMP, is in place to deal with the issues. FedRAMP is a government-wide initiative to provide joint authorizations and continuous security monitoring services for all federal agencies with a focus on cloud computing.  By providing a unified government-wide risk management for enterprise level IT systems, FedRAMP allows agencies to either use or leverage authorizations with: 1. Vetted interagency approach, 2. Consistent application of Federal security requirements, 3. Improved community-wide risk management posture, and 4. Increased effectiveness and management cost savings. There are three components to FedRAMP:

1. Security Requirement Authorities which sets government-wide baseline security requirements that are interagency developed and approved.
2. The FedRAMP Office which coordinates authorization packages, manage authorized system list, and provide continuous monitoring oversight. This will be managed by GSA.
3. A Joint Authorization Board which performs authorizations and on-going risk determinations government-wide. The board consists of representatives from GSA, DoD, DHS and the sponsoring agency of the authorized system.

A few vendors, like IBM, have data centers that are set aside for the Federal Government agencies and are FedRAMP authorized.

The IBM summit was well attended but not everyone in attendance was a convert to social business (or I guess we could call it social government, although that does get dangerously close to the term socialism, which is definitely not what is intended). There was a gentleman at my table who in very many ways fit some old stereotypes of the government bureaucrat who clearly was not interested in anything that was being said (why he came I'm not really sure, unless it was a way to get a day off and a free lunch). At one break he was loudly sharing his studied opinion on just how dangerous all this social media stuff really is. According to him, the NSA (the whole agency I guess) had told him that you'd have to be crazy to use a public social network, and if you do, just be prepared...hackers will steal all your personal information and even steal your money right out of your bank account! (Frankly at times, I've been more worried about what Zukerberg was doing with my personal data than hackers...but you never know I guess). At least I was well entertained at the breaks...

So with all this government activity around social business what can we learn from the agencies? Here are a few best practices that I took away from the day:

• Provide clear policies for the use of social tools, particularly public social networks. This isn't a new idea of course, but it definitely reinforced just how important having a clear, concise policy is for a business. And don't forget that once you have a policy you have to provide ongoing training for everyone on the policy.
• Provide best practices training for employees to ensure you get the results you want.
• Having dedicated staffing with clear responsibilities for social activities goes a long way to make a program successful. If the use of social tools and building a social business culture is important to your business then invest in resources and expertise to drive that success.
• Just because the outreach social programs seem the most obvious and important don't forget to work on the internal collaboration issues as well. A silo'ed organization cannot effectively engage its customers / constituents.
• Building a collaborative, knowledge sharing culture is powerful and returns significant value to employees, customers, partners and to the overall business. Social tools are an important part of any social business initiative but without the right culture they will not deliver a successful social program.

All in all it was a fun event and I left feeling even more convinced that social business initiatives are delivering real value to businesses and agencies.

Tags: social, socbiz, government, social media, social networks, VA, EPA, USMC

Emerging and Changing Employment Models

The recession and its aftermath created a business and social change wave that we're still struggling to understand. One area in particular, work or employment, both the way people are employed and the way companies and individuals get at least some of the required work done is changing. New models of employment, some an extension of shrinking corporate budgets and realities of how an individual can make a living, and other models enabled because of growing connectivity created by the Internet, are popping up everywhere. We know and I've discussed here many times, that the Internet is enabling all sorts of business model innovations and some of those new models are directly related to employment.

As more and more people were forced out of traditional jobs and as more companies looked for creative ways to get peak load capacity without hiring more direct employees, contract work has rapidly expanded. Not that independent contracting itself is new, it's not, but the number of people who are working in that model, and the number of companies that are using it has grown rapidly with no decline in sight. Many individuals forced out of corporate jobs have found that freedom and flexibility as well as the ability to maintain a decent standard of living has made working as an independent more than a desperate fall back plan, but in fact can be a desirable lifestyle change. And in a connected, information based, mobile and cloud enabled business world many types of roles are easily executed in a contract / task / project model. In fact for many it has turned into a win-win, companies get access to great talent when needed but don't have to bare the ongoing expense and people get compensated for what they know and can do yet maintain independence and flexibility while doing interesting, stimulating work. Don't get me wrong though, I certainly do realize that many have suffered greatly in a very tough economic environment, but at the same time I know many who have found life changing or at least acceptable new ways to earn a living.

Because of the growing population of available independent workers, many new businesses have grown up to help both individuals find and do contract work, and also help businesses find, manage and pay qualified contract workers. The increasing number of technology based contract positions, particularly coding, fueled the growth of two start ups in the contractor "matchmaking" market, oDesk and Elance, which I've written about a few times including this post on the Human Cloud so I won't spend much time in this post on that part of the new economy.

Technology skills, coding in particular, are in high demand both in direct employment models and in contract models. I've read several articles this year on the idea that every new college student (or unemployed recent grad) should learn to code to make themselves more employable. In fact in the realm of developing independent skills, coding is solid gold it seems. One start up that leverages this trend is Codeacademy, an online coding learning environment that is sponsoring Code Year 2012 for people to learn coding skills this year...and so far 415,953 people seem to have taken that challenge to heart.

Among the new employment models that are related to the increasing availability of independents is a trend that some have labeled micro-employment. This is a very interesting new area that is enabled by the Internet and leverages peer to peer connectivity as a part of the model. The idea is that companies and individuals can outsource tasks using an online matchmaking service. These tasks could be anything and in some models the work is based on projects that can be broken down to very granular micro-tasks. The process is facilitated by an online marketplace environment where employers (individual and companies) can post tasks and potential candidates can bid on the work. Posting is free as is job searching, the fee is based on the transaction and is paid by the employer when a match is made and executed. The best know of these services is Amazon Mechanical Turk, but the competition is heating up in this market with two newer competitors Zaarly and TaskRabbit. While each company has some unique components they all leverage the Internet and rely on a community paradigm to establish and maintain credibility of both parties. Leveraging the social network effect for establishing and maintaining trust is a key component to the success of this model. The type of tasks are very diverse ranging from highly skilled to unpleasant (at least in my opinion) manual tasks and the pay rates are just as diverse. These three sites alone represent hundreds of thousands of employment opportunities.

From the human cloud to micro-employment for many at least, the nature of employment is changing, and the opportunity for getting work done is facilitated in new ways because of the Internet and the social web. The new economy is still being defined but these new employment models are an important part of it.

Tags: employment, work, micro-employement, new economy, human cloud, code year