Data & Analytics

11:05 AM
David Saul
David Saul
Commentary
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What Is the Business Value of Social Networking?

The first step any organization should take is an assessment of where social networking could help existing businesses and where staffs are already employing it.

It is easy to dismiss social networking as a cultural phenomenon that has no relevance in business. We confuse the underlying technology with Web sites where people share photos of cute kittens or teenagers follow every activity of their pop idols in 140-character messages. It is a mistake to reject social networking on the basis of those trivialities. Organizations can use social networking to improve communications, foster innovation and speed process development. These can be accomplished while maintaining confidentiality, privacy, and compliance. Our own experience at State Street over the past several years proves the value of social networking in helping us to facilitate business transformation.

The first step any organization should take, as we did, is an assessment of where social networking could help existing businesses and where staffs are already employing it. You may be surprised to discover public social networking sites that are hosting communities of interest about your firm to share ideas and ask questions of each other. This external use can be used to help justify your internal project and bring the shared information under your control. An inventory of the information that is already being shared internally, using products like SharePoint, is also critical in developing your social networking project plans.

The choice of technology to use for your platform should be driven by what information will be accessed on it and its data classification (general, internal use only, confidential, etc.). You also have to look at whether you want to host it yourself or use one of the external cloud-based providers. Integration with your other data sources should be a major driver of that decision. We did several proof-of-concept (POC) projects to familiarize ourselves with the technology options before settling on a product that we run internally to provide close integration with our shared data and existing Web sites.

We spent a lot of time and effort on governance before, during, and after the POC. Our steering committee has representation from IT, marketing, legal, human resources, compliance, privacy, information security, and other groups. We were particularly concerned about data privacy issues, since we would be sharing information across geographic borders. Cultural differences that come into play when working with 29,000 employees in more than 20 countries were a high priority.

Our broad membership was crucial in addressing everyone’s concerns prior to going into production. Strong support for the social networking program from two areas proved critical to its success. We had a senior management sponsor who recognized how critical collaboration would be to business transformation in quickly sharing best practices. Our corporate marketing group saw from the beginning how social networking would enhance the speed and quality of communications. That group also gave the name to our effort -- State Street Collaborate.

Prior to production, we talked to a number of other companies in different industries to understand pitfalls to watch out for. From those conversations we knew to increase user education beyond what we had planned. We used the social networking software itself to provide that education. We created a network of champions, drawn from our POC, to serve as advocates across our different organizational units and leverage the platform's capabilities for Q&A.

Our steering group drafted a set of usage guidelines and validated them against legal and regulatory rules. As a global organization we had to ensure that we would be compliant in all geographies. We set up requirements for clear ownership of each community to ensure compliance with our usage guidelines. We also made sure that our product choice had rich metrics so we could measure acceptance. Our governance group weighed the scope of our effort and decided to incorporate multiple aspects of our work experience, including community, charitable, and other aspects of working together. State Street Collaborate is a reflection of the strength of a diverse workforce.

Adoption over the first few months was relatively slow, but has since exceeded our expectations. Our adoption model was built around the Everett Rogers Technology Adoption Lifecycle, which holds that 12% of users will be early adopters. We purposely allowed those 12% to take part in our pilots and serve as our champions. We used them effectively as trainers as we came closer to production launch.

Using this approach we were able to leverage 200 people to train personally more than 6,000 employees worldwide. In hindsight we would probably have been better off to follow advice from Andrew McAfee of MIT, an authority on social networking. He recommended going “one inch deep and one mile wide.” By that he meant to roll out one social networking function at a time, like communities or microblogging, but to deploy it broadly throughout the organization. We opted instead for a rich deployment from the beginning.

After over a year of increasing use and success in achieving our business objectives for Collaborate, we rolled out a second major release that provided even greater integration with our internal Web portal. We now have a single landing point where people can receive the latest news, connect with their colleagues, and customize the information they receive. Senior executives regularly use Collaborate to hold live open forums and respond directly to questions from across the company.

The platform enables a degree of transparency facilitating multi-party conversations that would be impossible using traditional email. Our experience with social networking has already delivered real business value and we continue to find new uses going forward. Our next steps in the social business strategy at State Street are to harness what we are doing externally with social media and to make that data and those insights internal through our Collaborate platform -- allowing for a single, continuous stream of information.

 [Related Content: Three Tactics to Support Social Business Innovation Three Tactics to Support Social Business Innovation.]

David Saul is senior vice president and chief scientist at State Street Corporation, reporting to the chief information officer. In this role, he is responsible for proposing and assessing new advanced technologies for the organization, as well as evaluating technologies ... View Full Bio

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JohnTran
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JohnTran,
User Rank: Apprentice
7/22/2014 | 9:55:25 AM
Business Value
The big value of social networking deployed in business environment is that it increase business innovation in many aspects:  customer service, quality improvement and technology trasformation.
Byurcan
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Byurcan,
User Rank: Author
7/17/2014 | 9:35:48 AM
Good article
Thanks for this David. You make some good points. Social media is often derided, and in many cases rightfully so, as just being a platform for the vain to display what dinner they eat, but social media platforms have great potential for internal collaborative uses, as you illustrate.
KBurger
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KBurger,
User Rank: Strategist
7/16/2014 | 4:09:45 PM
Re: The value of social networking
Good point, thanks for that feedback.
davidnsaul
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davidnsaul,
User Rank: Apprentice
7/16/2014 | 3:13:33 PM
Re: The value of social networking
Kathy,

What you are doing with your web site redesign embodies some of the same collaborative communications benefits that we are seeing with our program.  I moderate a Chief Scientist community where people can share and react to new ideas.  You are doing the same thing on a broader scale.

Regards,

David

 
Kelly22
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Kelly22,
User Rank: Author
7/16/2014 | 2:56:22 PM
Re: The value of social
Agreed - David, this is a great overview of how social networking can be successfully leveraged throughout a business. Financial services companies have been slower in adopting social, so I thought it was smart to consult companies in other industries to learn the pitfalls that may accompany social adoption. Looks like that proved useful in your overall strategy. 
KBurger
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KBurger,
User Rank: Strategist
7/16/2014 | 2:31:02 PM
The value of social
Thanks for this, David, tons of really useful and applicable information here. The fact that State Street is having this degree of success underscores your point that social media is not just about teenagers, or even just about consumers -- there clearly are tremendous opportunities in the B2B space, involving corporate clients and also within the enterprise. You touched on some of the data integration/data management issues, I would imagine as Chief Scientist that is something you are analyzing very thoroughly. It seems like that's where there's potentially the greatest opportunity for banks (and other businesses) but also potentially the greatest risks, if it's not handled the right way.
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