The Social Enterprise Fail Whale

Gartner just released a report “Predicts 2010: Social Software Is an Enterprise Reality” identifying the direction enterprise social software will take in the coming year. Their top 5 predictions are:

1. By 2014, social networking services will replace e-mail as the primary vehicle for interpersonal communications for 20 percent of business users.
2. By 2012, over 50 percent of enterprises will use activity streams that include microblogging but stand-alone enterprise will have less than 5 percent penetration.
3. Through 2012, over 70 percent of IT-dominated social media initiatives will fail
4. Within five years, 70 percent of collaboration and communications applications designed on PCs will be modeled after user experience lessons from smartphone collaboration applications.
5. Through 2015, only 25 percent of enterprises will routinely utilize social network analysis to improve performance and productivity.

The most important of these predictions to note is the significant failure rate of social media efforts that are born without a firm business strategy. Too often technology is applied without a business case, money and effort is spent developing technical solutions that may or may not yield core business value. We saw this happen with client server technology and again during the web bubble. And it seems that enterprise is headed in the same direction again of leading with tools instead of business objectives.

The core drivers exist for enterprise to apply social media in meaningful ways- they just need to be realized in a business (and not technology) context. Some enterprises can look to social media to reduce costs as cloud computing can offer significant cost reduction, others can apply social media to retain customers by creating a stronger platform for customer care and customer intelligence gathering, and speed to market remains one of the best applications of social media. The information exchanged with clients and prospects can help lead new product ideas and improvement arenas never before recognized – let alone within rapid time frames and in context.

Social media in all rights should be a haven for business innovation to provide better products and services as it cracks open three key areas for business innovation: More useful information (if programs are developed to make use of the information generated and integrate the existing business processes into the social media driven processes); Greater access to users (who doesn’t want or need better retention strategies); and Increased collaboration capabilities (which can inform and guide innovation, customer care etc. for organizational learning and intelligence).

The Gartner predictions can serve enterprise well – both to awake the imagination around the future direction of social for business and also serve as a powerful warning.

Becoming an enterprise failure statistic is avoidable with proper planning, business goals, meaningful metrics, and a well thought-out strategic and operational planning process that takes into account both the business focus as well as the user needs. It is at this intersection of business strategy and technical application that failure can be averted and business can successfully make the shift to a more engaging and social experience with and for its customers.