Michael Fauscette

From Social CRM to "social" PLM, developing products in a social environment

Wisdom of crowds and crowdsourcing are all the buzz in CRM circles these days. The concept grew out of the Web 2.0 world and is popping up all over the place. My friend Michael Krigsman has recently posted some interesting videos and observations on collective intelligence, wisdom of crowds and crowdsourcing on his ZDNet Blog on IT Project Failures. I'll let you read his blog for more depth on the concepts involved. I started doing some research on what I'm calling ideasourcing last year and at first focused on the more CRM aspects of applying the concepts for business but I am increasingly interested in the cross over into other enterprise applications and processes. Because of my time at a couple of product design software companies I have a reasonably good understanding of many different product development processes and the tools, challenges and pressures associated with bringing a great product (or even a less than great product for that matter) to market. The company that brings the "right" next product to market is often the winner, first to market or closest to what customers value (or perhaps the best marketing but that's a different topic entirely) and you gain market share against your competitors. There are many difficult points along the concept to design to manufacture process where your business can run off course but one of the most feared failures is building the great product that no one wants. The mismatch between customer needs, wants and desires and the vendors "understanding" (or lack of understanding) of those same needs, wants and desires can be catastrophic.

So can a product development / design team successfully apply ideasourcing to their design process? There are already some community software products available to capture the idea part of the customer community (uservoice, BrightIdea, salesforce.com Ideas, HiveLive, etc.) and then enable the community to "vote" on the idea. This is at least a start in aligning customer's desires to the companies product plans. (and by the way, I don't mean to discount other product marketing tools and techniques, they have their place as well). The power of the community (assuming you have a community) can produce well vetted product ideas that represent the collective desires of your customers. There are a few necessary characteristics for the community to function however. The concept of wisdom of crowds is built on the effect of asking questions across a broad and diverse group. This group must be actively engaged with your brand but independent from it (not controlled by you). The individuals in the "crowd" must be acting on their own but in the end all of the independent inputs have to be collected and aggregated.

The solutions I've seen for the most part break down after the aggregation though. The inputs are generally used manually to help guide the product design process but are not captured in a continuous workflow process that is integrated into product conceptualization and design. BrightIdea is something of an exception to that, as they have developed 3 products that shepherd the idea from collection, to aggregation / scoring all the way through to a project. In my opinion though we need to integrate the ideasourcing solution into the rest of the concept to manufacture process. (I will save the social field service discussion for another post, but I think there is opportunity for PLM vendors on that end of the product process as well)

One last thought, I was reading a very interesting post on the Dassault Systemes official blog 3D Perspectives that takes social product development in another direction. I've written and talked about the first productive social web communities in the past so I'll just remind you that in my opinion open source software development communities led the way in breaking the ground for socially (or community) developed products. In the post, Jonathan Dutton (a Dassault employee responsible for automotive strategy) suggest that product design could be run in a similar way to open source software. Jonathan offers up several examples of companies that are trying open source product development including riversimple, a UK based automotive company. I haven't done much research about the idea of extending the open source software development model to products but given the fact that the model produces very high quality and relevant software I don't see why the same result could not be achieved for other products. This emerging model definitely peeks my interest and will merit a deeper investigation.

Creating a Culture of Transparency

I was reading an article yesterday that got me thinking again about the culture shift that is necessary for a business to embrace the social web. The article from ChiefExecutive.net discussed the adoption of Web 2.0 principals by CEO's and supported the idea that CEO's are starting to "get it" and support social business initiatives. The article is very well thought out but I'm not here to review articles so I'll leave it at that and you can check it out yourself. If you read this blog you no doubt have read that I believe that e2.0 or social business initiatives are more about culture change in an enterprise than anything else including technology. The general leadership model used in business today is based on a model that grew up around the industrial revolution and has remained mostly consistent since then. That model, the hierarchal or top down model, is not conducive to the kind of culture needed for building a social business. It also was in general, anything but transparent. Web 2.0 has taught us that impactful change comes from democratization of interaction across a wide base. This horizontal network effect becomes the shared base of power for all subsequent actions. As you can imagine sharing power and control across a wide group is counter to the hierarchal leadership model where control is tightly held in a small group.

So if CEO's are starting to embrace social concepts for their businesses then that means the leadership model is starting to change in these organizations...or at least it's starting to get very stressed. At the core of this change though is the concept of transparency. The software that enables social business has inherent transparency built in but is that enough? Unfortunately no, just because you enable information flow doesn't mean that it will actually flow anywhere. Underneath the software there's a need for a culture of transparency, which is fundamentally different from what often happens in businesses today. Transparency is build on trust, or maybe trust is built on transparency...frankly I don't know which comes first, they're inexorably linked in my mind. I suppose I could have titled this "Creating a Culture of Trust" just as easily as transparency. Building an organization of trust requires free and open access to information and a culture that encourages openness (which is IMHO a higher order level of thinking and behaving). Culture change usually happens in small increments and this may be particularly true when trust or building trust is required. Trust is also hard won and easily lost, a process that seems to be amplified in an online environment. As a leader you can start to move towards transparency by supporting openness, enabling free flow of information and rewarding actions that build and sustain trust. And this doesn't just apply internally with employees, the concept is also critical with any relationships from partners to customers.

Predictive is the new black

I was having a chat last Friday with my friend and fellow blogger Michael Krigsman about crowdsourcing and wisdom of crowds and our conversation turned to predictive capabilities and the idea that in the near future businesses will start to use social data to predict behavior. That conversation sparked some more thought about the whole concept of predictive software (versus reactive software). Earlier this Summer I participated with a group of analysts and CRM experts in an exercise with CRM Magazine and DestinationCRM to look at the next 5 years of evolution of social CRM in the CRM Maturity Model. In looking at the future of sales and marketing for example, I can clearly see the promise of getting to a place where a business had created such a close relationship with its customers that it could "know" what the customer was going to want in the future and how they would want to be marketed to (the when, where and how concept that I've used in talking about social customer support works the same in this model too). Forgetting for a minute the slightly uneasy feeling that might conjure up for you, think of the value and experience of having your needs and desires met seemingly as you think of them. OK, we're not quite to that point in our use of social software and social concepts but we are moving in that direction.

I've talked about the progression of the development of application capabilities before, that is the progression from transaction (data creation) to analytics (information creation) to automation of events based on the information created. The automation is based on a software concept called event driven architecture. I suggest that with social software we have another level of progression beyond event driven architecture to prediction driven architecture (and yes I just made that up, I doubt we need another meaning for PDA at this point but you get the idea). Predictive capabilities could be implemented for sales, marketing, customer support/service, product marketing / strategy, even internally for HR (how about predicting an employees true motivators and build rewards and perks to meet those desires). We're just now seeing the movement of social concepts into enterprise software with the merging of social platforms with enterprise platforms (like the RightNow HiveLive acquisition I wrote about recently). In discussion with the RightNow / HiveLive team last Friday I asked about their take on social analytics and where they are looking next. The response, tie social data to RightNow's already robust artificial intelligence (AI) capabilities. That's just a whiteboard discussion today but probably not that far off as they move to quickly integrate the two platforms. We're not there yet by any means but for me, predictive is definitely the new black...

RightNow to acquire Social Software Platform Vendor HiveLive

Today SaaS CRM vendor RightNow announced its intent to acquire HiveLive, a full featured social software platform for ~$6M in cash. OK, this isn't Oracle announcing that it's buying Sun and I suppose it would be easy to skip over this one but I think this move by RightNow is interesting on several levels. There's the obvious good news that HiveLive's solution adds robust social CRM capabilities to RightNow's already strong customer service offerings...more on that in a minute. The other not so obvious thing though is the nagging thought that this could be the start of an acquisition frenzy among established software vendors that need to add significant social capabilities to their products or risk losing an edge with emerging social businesses and their need for enterprise class social solutions. There's a lot of innovation happening in the many enterprise social software start ups that I've looked at recently, the same kind of innovation that end users are starting to look for. Some of the larger software vendors are starting to build out some social capabilities but for a real jump start they will most likely look to the current innovative start ups which are, I might add, very reasonably priced in our current economic environment (and not likely to get any cheaper).

So what does HiveLive bring to RightNow? It should be no surprise to anyone who reads this blog that I think enterprise social solutions are rapidly gaining in importance and creating a real opportunity for businesses to transform the way they do business. This opportunity is especially strong and provides high potential for value to businesses in the customer facing functions from sales and marketing to product marketing / management and customer service. The social web is bringing about a sorts of changes in consumer / customer behavior that are today outside the boundaries for most businesses. Conversations happen about brands in online destinations but can you listen or respond to them? Customers are relying on their trusted social networks for product and support advice. Their turning to Twitter, Facebook, YouTube, etc. to express themselves. RightNow has the opportunity of integrating a social platform tightly into its customer service, sales and marketing CRM solutions so that the social world of the web can be linked to a companies CRM processes. If the integration is complete (the press release sets November '09 for the availability of the "tightly" integrated solution) the new solution could be very interesting to businesses who are looking to change and improve the way they interact with their customers. HiveLive's platform could enable:

• Customer communities for customer to customer support
• Communities for creating innovation: crowdsourcing or ideasourcing new product ideas and product improvements
• Incorporate blogs and wiki's as a part of the customer experience and to foster dialog and engagement
• Use wiki type functionality to enhance RightNow's knowledge base offering through incorporating user generated content
• Facilitating a customer loyalty program that could include communities or social networks
• Self-managed customer groups
• Content sharing
• Social analytics tied to CRM analytics

It will be interesting to see the new, integrated CRM solution as the integration is completed. I also suspect we'll be seeing many more announcements in this "space" in the coming months.

Social business policies

I was speaking at the National Business Travelers Association (NBTA) conference last week on the future of tech and social media and I was asked a question that sent my thinking down a very clear path. The question actually is a version of something I get asked fairly often but somehow this time it made me realize that the topic of social web use policies needs some more discussion. The question itself was from a somewhat frustrated HR manager and was phrased something like "we know that we have employees participating in social media, social networking, etc but what we don't know is what they're saying about us. We don't have a way to monitor them all and find out, so what should we do?" The simple answer is, of course, establish a policy for social media use. Why is it we don't take social media / social web use serious enough to think that it needs a policy to provide some guidance? I think most employees want to do the "right" thing but given a lack of guidance or a framework they will substitute their own judgement (which I like to think will be appropriate but...).

I wrote not long ago about two fairly high profile approaches to social media policy, the UK MoD and it's open but detailed policy for social media use and the very restrictive and opposite approach from the US Marines banning all social networking use by members. These two cases are great examples of the two most opposing approaches we see today. More companies though fall in the middle or "never land" of social use policy. In a lot of cases I see the lack of policy is akin to sticking their heads in the sand and ignoring what's happening. In the other extreme we also see companies simply trying to block access to social sites on the company network. Ignoring or blocking is in effect the same thing, you cannot block access via mobile device (the next gen web is mobile). From what we've seen most social business initiatives start as grass roots movements, moving into an organization from the bottom (which is "normal" for web 2.0-type activities anyway). Once these grass roots initiatives get large enough to get management attention then (and only then) do most companies start thinking about strategy and policy (which may, BTW, not be a bad thing. The shift to a social business approach is mostly cultural and the grass roots nature tends to aid adoption). This is not universally true of course, some companies are proactively setting strategy and policy, but they seem to be the exception not the rule.

So let's assume that you buy into the idea that you, as a business, need a social strategy and social media policy. What should be included in both? Let's look at strategy first. I personally believe that business strategy, while not necessarily complex, must be written and available to all employees. It could be a part of your social media policy, stand alone or a part of the overall business strategy (which I think is actually the most effective approach). The social strategy needs to look at all of the areas of social business use, both internal and external and address each departments' strategy (depending on your plans to make use of social software tools in each area). Potential external facing areas of impact include: sales, marketing, product marketing, product management, product development, and customer service. Internally social strategy should touch HR, executive / management, finance, operations and all employees. The content of the strategy is highly dependent on each business and their plans to embrace the transformation to a social business. I won't spend much more time with strategy in this post, I really want to dig into the policy and some potential content.

A social media policy should address several key issues. The overall goal is to define acceptable employee use  (both what is acceptable and what is not), establish standards around company brand and brand references, provide guidance on the companies intent to use social media as a business tool (and the boundaries around that intent), and define a course of action to deal with improper use (as defined in the policy). From an employee use standpoint you need to address:

• How can employees use social media and when (can they write about the company? can they use SM during work hours? Is there an official company account on each network? How do the individual accounts relate to company accounts?)
• How should employees refer to company brand (I strongly encourage transparency, allow employees to identify as employees of XXX company. This is especially important if/when talking about a competitor.)
• Clearly talk about misrepresentations of self and company and the damage it can cause.
• Deal with confidential information and its potential exposure (both company and personal)
• Address the potential for online confrontation and establish what is and is not acceptable. (explain tact and appropriate response as well as escalation)
• Creating spam is not acceptable!
• Use diplomacy if you are writing or commenting on competition. Also remember to be company transparent.
• Explain things like online respect and consideration of others. Common sense is the simplest guideline (although not everyone has the same understanding of "common")
• Be clear what things are not acceptable to write about, comment on, etc. This should include ongoing legal investigations, SEC investigations, company confidential information, crisis issues, etc.
• Clearly define topics that need to be referred to other departments like legal and PR.

This is not an exhaustive list but it is at least a start. What else should be included in a SM policy?