It’s been a busy week in Boston, where the Socialtext crew has been talking with practitioners, analysts and journalists about the benefits of enterprise social software and what to expect in the coming year.
Tomorrow, Socialtext’s CEO Eugene Lee (@eugenelee) will be keynoting the conference at 10:40 a.m. eastern (which you can watch live here). Among many things, Eugene will highlight the importance of focusing on business value and offer some solutions for how the industry will move forward to better serve companies that want to get the most from their enterprise social software implementations.
It promises to be a very compelling talk, and we hope you can check it out.
If you follow the media industry, you know how much it has struggled to adapt its business model to the Web. But what’s not written about as frequently is how some media and publishing companies are using social software — one of the very technologies that disrupted the industry — to pursue new business opportunities and grow revenue.
That’s been the case at Meredith Corporation (here is our full case study we published today). Meredith counts 23 subscription-based publications in its portfolio, including Better Homes and Gardens and Ladies’ Home Journal. With its various properties, Meredith serves a readership of nearly 75 million women.
At Socialtext, we focus very heavily on the business value that social tools can generate for companies internally. As someone who cheerleads for media companies who work hard to adapt to market changes (I used to work for one), I was encouraged by Meredith’s strong results during the course of my research.
“Since Meredith began using Socialtext in the fall of 2008, its subscriber numbers bettered an industry that was in decline. According to the most recent State of the News Media report, the magazine industry’s paid subscriptions, which make up nearly 90 percent of magazines sold, declined 1.12 percent overall. Meredith, meanwhile, in the second quarter of fiscal 2010, increased its circulation revenue by nearly half a million dollars from the same period a year before.
In a disrupted industry where flat revenue or even light losses are viewed as an accomplishment, the increase wasn’t lost on Meredith’s investors when the company reported its financial results. In fact, the company reported that the “revenues, profit and related margin in Meredith’s circulation activities (that) increased in the second quarter of fiscal 2010 compared to the prior year (were) driven in part by efficiencies in subscription operations.”
Recently, Eugene and I had the opportunity to visit with Michael Singer, a senior editor at Internet Evolution‘s offices in San Francisco. Eugene shared his thoughts on the future of social software, and how it affects enterprise and mid market companies. What made this interview especially unique is it offers a glimpse into many of the exciting things we’re thinking about here at Socialtext, both from a product perspective and, more importantly, the value it provides our customers.
I’ve embedded the video below, where Eugene emphasizes:
The importance of focusing on the business value that social software provides a company (not simply adoption).
People are achieving transformative business value, not just innovation, by moving work across silos with social software.
Social software platforms will serve as a place to surface the events from other enterprise systems. In doing so, we can make traditional enterprise apps more social and useful.
One of the more unfortunate words that prevails in the software industry is “user.” “User” marginalizes the importance of people, and subconsciously implies that we should simply use the software in the way it’s presented to us without question. It makes it seem as if people should adapt to a vendor’s terminology, data model, and workflow. In reality, it should be the other way around: Software should enable people to communicate and collaborate with each other, share knowledge, make informed decisions, and get our jobs done faster and more efficiently than ever before, in a model that makes sense to them.
I’ve only found two industries who describe their customers as “users”. One is high tech, and the other is drug dealers.
We have even evolved highly specialized disciplines whose monikers involve the word “user” – “user interface” or “user experience.” Worse, the science of “user interface” has historically been called “human factors” – where we’re now describing “humans” as organic life form alternatives to the preferably predictable and “error-proof” silicon powering the machines we force users to adapt to.
In reality, business is conducted by people, not users. People introduce themselves by job title or organizational affiliation. They have passions and expertise, and like to share knowledge with the teams and groups they’re on. Almost no one describes themselves as “an Oracle user”.,
Socialtext has always focused on reaching out to business people first – which fits hand in glove with our all-SaaS business model (as opposed to selling big perpetual license deals to IT who then try to stimulate adoption with users). Our whole company is aligned around the priority of enabling our customers to achieve business value, not just adoption. That starts first with designing and delivering functionality that enables customers to answer more substantial questions (such as “who knows what” or “who knows who knows what”, not just “who knows who”). Our entire sales and marketing methodology emphasizes the importance of identifying business champions (see Michael Idinopulos’ excellent post “How to Find Enterprise 2.0 Champions”), and partnering with our customers throughout their implementation to ensure they are realizing business results. We continually adapt and innovate product enhancements based on their feedback.
Business people feel proud of business results they achieve by being part of something bigger than them – and usually by being part of a team that made it happen. Software should adapt to these people and their needs.
Although enterprise microblogging has emerged as a key technology to enable better collaboration between employees, it holds the greatest business value when it’s integrated with other bits of social and enterprise software. That’s the overall theme in an article today by Clint Boulton of eWeek. Detailing a recent Gartner report, Boulton writes that “while more than 50 percent of enterprises will use activity streams that include microblogging by 2012, stand-alone enterprise microblogging will have less than 5 percent penetration.”
The predictions reflect what we’ve experienced in the market with customers. One of the reasons our customers have derived business value from Socialtext Signals (our microblogging tool) rests in the fact that it integrates well with social tools in our platform. For example, when saving a workspace page, Socialtext can automatically post a link to the page in Signals, making it simple for your colleagues to discover and access the updated content.
In the article, Garner also predicts that “70 percent of IT-led social projects will fail.” This bolsters our contention that line of business (LOB) people make the best champions for social software because they feel the pain points in their daily processes very tangibly. This is not to say IT won’t play an important role. In allowing enterprise social software to integrate with other enterprise systems in a secure environment, IT is a critical player and needs to work closely with LOB champions and vendors to provide this integrated experience.
A significant downside to standalone enterprise microblogging tools, which isn’t cited in the article, concerns security and control. As some of these free, niche tools crop up organically within companies — and employees begin to share private, proprietary information over them — an IT administrator must pay the vendor providing the service just to get control of logins, passwords and the domain the employees set up to host the information. This isn’t a true freemium model; it’s an extortionist sales model.
It’s been a great week for both the Socialtext team and our customers here at the Enterprise 2.0 Conference in San Francisco. Leading up to the event, we focused intensely on approaching this conference from a thought leadership perspective. Principally, we believe it’s time for the Enterprise 2.0 facet of the software industry to demonstrate the business value that these social technologies provide our customers and lay out a framework for how companies can get started.
I think we’ve constructed an excellent foundation for that effort with our six ways to get business value from social software, a paper we released this week at the conference. Based on our experiences with our customers, we highlight how companies can derive business value from their use of social software within departments, across an organization or with their customers and partners. By improving both formal and informal processes with social software, organizations can enable their employees to share and find the people and information they need more quickly. When this happens, it helps people satisfy their customers, react to change and capture new business.
While we’re proud of the research and work we did with customers to make this paper come to life, we know this is an ever-evolving challenge. We look forward to hearing ideas from more companies, colleagues, analysts, and our competitors to help improve upon it.
Weblog on gaining business results from social software.
On this blog, Socialtext staffers and customers explore how companies can gain the most business value from their use of enterprise social software, including microblogging, social networking, filtered activity streams, widget-based dashboards, blogs and wikis.
This practical guide shows you six different ways to achieve your business goals using social software. It will help you choose the best social software approach for your enterprise – with the right balance of risk and reward – so you can get the business results you’re looking for.