Karl Moore and Peter Neely
To date, companies have embraced social networks by setting up Facebook andLinkedIn pages. Many view these as an extension of their current marketing mix and offer product information, sales notices and contact information which is no different from their website. Many companies have also started using Twitter as a broadcasting medium, tweeting when they have new products or are having a clearance sale as a syndicated one-way communication with its followers. Really savvy companies are using new software monitoring tools to search social media for discussions, comments, and complaints by customers and employees about their company and products and services. In many cases, they get some great information that they use to improve their product or service, and sometimes they even contact people who complain to gather more details as indicative about how other customers might feel.
But the biggest value that social networks offer goes beyond being marketing channels to push communication to prospects and customers. They are morphing into new channels for collaboration and innovation. Social networks are becoming unique touch points to engage communities, start conversations, recruit skillful employees, and develop new innovative ideas. Firms that successfully leverage social networks are doing so to engage their communities in conversation explicitly to tap into their brainpower and energy. They ask customers and followers to participate in brainstorming with them so they can learn how to be a better company, offer better products and services, or support the values and issues of the community.
Social networks are increasingly tapping into this collaborative mindset in ways that continue to evolve. We first saw the power of mass collaboration with the advent of Linux, an open source operating system, when it opened its source-code and allowed software developers around the world to openly add and improve the core product. The collaborative process raised the level of quality, innovation and speed of new feature delivery for Linux.
Since then, many other companies have started to embrace and develop collaborative networks to create value. They understand that ideas can come from anyone, anywhere and at anytime. Three examples demonstrate how some organizations have taken advantage of this new collaborative mindset and are leveraging the power that networks offer.
* Toronto-based Goldcorp, a gold mining firm, sought a new approach to finding gold deposits on their 55,000-acre Red Lake, Ontario property. With analysts believing that the fifty-year old property had been emptied, high production costs, labor strikes and lingering debt, the firm was desperate to find new life. Without options, CEO Rob McEwan created the “Goldcorp Challenge” whereby he placed every piece of information about the property on the web for all participants to download, study and submit recommendations. More than 1000 participants from over 50 countries signed up to solve Goldcorp’s problem. Submissions came from a diverse group of participants, many not trained in geology. This open-source innovation network proved to be invaluable identifying 110 targets worth more than $3 billion. By opening the information to a wider network, the company benefited from collaboration of internal and external knowledge banks.
* The second example uses the idea of social and collaborative networking within the four walls of the organization. In mid-2007 IBM created Beehive, an internal social network to connect employees worldwide. The network gained momentum and supports 30,000 employees. Each employee can add a bio page, photos and connect with employees from other IBM offices around the world.What’s interesting about Beehive is how the employees use the internal network. There are three distinct categories of use. The first is to connect with employees they meet at conferences or when working on interdepartmental or inter-divisional projects. The network provides a mechanism to stay connected and get to know other employees and their area of expertise.The second use is to gain project support and brainstorm with others on how best to complete a project. The connections provide a collaboration channel to promote the project to others and gather ideas from other people at different levels.The third use of Beehive is the opportunity to connect with people at higher levels of the organization that are not accessible via traditional channels. Employees use connections to these executives as a method to share ideas and get career advice with the hope of advancement. IBM Beehive is a great example of leveraging an internal social network to cultivate communication, interaction, and collaboration within the widely distributed company.
* The third example is InnoCentive, the first global web community for open innovation created back in 2001. InnoCentive is designed to bring seekers (companies with problems) and solvers (scientists, engineers, professionals, and entrepreneurs with solutions) together to collaborate on challenges that R&D-driven organizations are facing. In 2011, this web-based network has more than 250,000 engineers, scientists, inventors, business people, and research organizations in more than 175 countries available to solve seekers problems. Companies like DuPont, Procter & Gamble, Dow AgroSciences, BASF, and Eli Lilly and Company, post problems their own in-house research teams cannot solve, offering rewards that range from $10,000 to $100,000. To date, InnoCentive has paid out more than $7 million dollars in rewards to solvers. Access to external resources helps companies source experts throughout the world. Without the internal knowledge to solve these challenges, many firms would fail to develop new products at the rapid pace needed in some markets.
The benefits of a collaboration networks are limitless. These networks breed co-creation, shared value, and cultures of collaboration that can be leveraged beyond the network. The new generation of Millennials and Generation C (connected, computerized, and community-oriented) have fully adopted the collaborative mindset as their own. They are educated, interactive and collaborative and have grown up using social networks as a tool for brainstorming and problem solving. This reflects a broad shift in generational thinking that is taking place. The broadcast generation from the industrial age is being met by a collaborative generation from the new knowledge age. The old ways of staying within the four walls to solve problems, guarding company information and developing products, services and solutions in isolation are gone.
Companies that can create or participate in a collaborative network and organize themselves to best leverage the benefits will enjoy a competitive advantage. Companies of all sizes can start by setting up a network of internal experts, suppliers, partners and customers. There are even technology platforms that can be employed to facilitate this collaboration so that you can get started immediately if you want.
So stop thinking of social networks as just another venue for your marketing. Their next evolution is already underway and holds much promise for the business world.
Peter Neely is a practicing manager with more than 20 years of experience in management, strategy and implementation. Peter holds an MBA from Richard Ivey School of Business and is a 2012 International Masters in Practicing Management candidate from McGill University.