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OpenKnowledge With headquarters in milan and operational branches in london, shanghai and sydney, openknowledge is a management consulting company focused on social business transformation.

Pioneer and leader on social business themes, since 2008 OpenKnowledge supports companies in their









OpenKnowledge is the organizer of the Social Business Forum, the most important European event on social themes, now at its seventh edition. OpenKnowledge is also the author of Social Business Manifesto (2012) and Social Business Toolkit (2013), published as attachments to Harvard Business Review Italia.

See more on: (@openknow)    


Indice 1. Social Business Manifesto – Introduction 2. Social Networks and informal mechanisms of collaboration 3. Providing new maps for Governance 4. Social Business Process Reengineering 5. Social Business: Cooperation vs Competition 6. Social Learning: the organization learns how to learn 7. Intranet 2.0:evolving communication and working environments 8. Social CRM: serving the customer 9. Enterprise Strategy, Policy and Governance for Social Media 10. Innovation today 11. Innovation through collaboration: how to make the innovation process social 12. The ROI of Social Innovation

1.Social Business Manifesto - Introduction Collaborative mechanisms are radically changing the way in which markets function and the way in which organizations create value. Consumer behaviour is becoming ever more conditioned by the reputation of companies among consumers and influence among peers, often leaving businesses themselves out of the conversation. How does marketing, advertising or CRM re-establish itself in the new millennium? The method previously relied upon to organize work – born during the manufacturing industry era in order to segment and control industrial production, a method which has reached the present day almost intact – appears inadequate and clumsy in managing the need for reactivity, innovation and agility in today’s organizations. How can we regain efficiency and speed? How can we free the great potential of intelligence, creativity and energy that is exploding onto the business network but which is still trapped in the bureaucracy of modern organizations? These questions go beyond popular phenomena or trends and critically examine business and management practices and convictions in today’s society. This is a reflection that dates far back and that has re-emerged over recent years in a devastating manner, taking the name of Social Business. Social Business is how a business operates in the era of interconnectivity. Social Business is a new way of organizing work and relationships with a business ecosystem. Management disciplines have developed great capacities to make stable and repetitive processes efficient over time. Businesses are now being asked to be more agile, to continually redefine themselves, to provide a relevance to service and customer experience, and more. This makes those capacities no longer sufficient and, in some cases, even dangerous. In this context, the emerging models of Social Business, both inside and outside an organization, are starting to show their value. If we really want to create something entirely new, we need to start looking around in a new way, otherwise we will continue to behave as we always have. To create new things, we need to look at

creating a newer version of ourselves. Let’s consider another period of great transformation, that of the transition from the medieval era to the modern day. The person who best represents this change is Christopher Columbus. Discovering America is in itself an intriguing story for those who study innovation. When we look at great moments of change, we often risk making the mistake of seeing things in a linear manner: some have thought that to do a certain thing, you need to plan the journey and then you will arrive at the destination. However, when you are on the journey of change it is nothing like this. It wasn’t like this in 1492. The story behind the discovery of America is full of errors; Christopher Columbus was convinced up until his death that he had shown the way to the West Indies and not that he had discovered a new continent. It took twenty years to correct this mistake. In order for people to understand that an unknown continent had indeed been discovered, Western Europeans had to change their own opinions and create new maps. In times of great change things like this happen: you discover things which you never expected to discover. And in turn your convictions, identity, and cognitive processes change. So why this introduction? Because today we find ourselves in a time very similar to the end of the medieval era, a time of great confusion. And for those of us who work in the world of organizations, it’s easy to see that in all of this confusion, traditional values and managerial models are heavily involved. The first point to consider is that we need to change some of our convictions. The current management models for our companies no longer work. We have made management a science; we have tried to transform people into machines; we have divided work tasks into segments, taking significance away from the things we do whilst we work; we have depersonalized things in order to try to control the work place; we have tried to standardize work to guarantee the possibility of repeating services without unforeseen events. This type of organization worked well when the theme of the business was repetition. It becomes a model that works far less well when the nature of the business is knowledge-based, striving for constant innovation, within an intangible environment. We don’t have the organization and the appropriate technology for the era that we are living in.

Just as at the time of Christopher Columbus, even we need new maps, especially because it is very difficult to manage things that we are not capable of seeing. These new maps are obliged to work with a technological infrastructure that has only been created in the last few years – the Web, more specifically, Social Media – which is interesting not only in itself, but also for the social behaviour it allows.

The dynamic that emerges by collaborating with other people online can be represented by a curve showing increasing marginal returns (Fig. 1): the overall growth corresponds to overall input. If we learn to harness the power of patrimonial intelligence and the energy of group work the value that is generated grows exponentially. For a long time we have been used to performance curves which in general have decreasing marginal returns, such as the typical curve of experience. (Fig. 2)

This comparison is very interesting, as it opens up possibilities for us of radical innovation which we don’t even know how to see using our current cognitive processes. We are in a time of great changes, but we think of change in an old way, as something linear, where we have to say where we should go, what the expected ROI is, what the benchmark of reference is, and what the plan of action is in order to reach the goal. But we will never get anywhere if we do not change our way of observing things. We could discover, for example, that – as happens on the internet – if organizations also moved their attention from codifying content (archiving documents, procedures, rules) to protecting connections they would have improved efficiency spaces in front of them. Controlling communication flows among individuals is becoming more important today than controlling the content of the communication itself. This adjustment must be made quickly, because the world is moving faster than ever. As the Queen of Hearts says in Alice in Wonderland, we must run, but we must run just to stay in the same place. There are emerging countries that are running much more than us; the phenomena that we have already mentioned are creating markets with different rules. The customer is now social (“social customer”) and much more efficient in making the most of the information on companies and products than the companies are themselves. The same thing is happening in some way within companies, with the birth and self-organization of communities and spontaneous networks favored by technologies, often operating consistently with the organization’s project, but sometimes not. This tendency has grown from a new generation of young people, who bring with them a completely different culture from that of the organizations that we have created. In this generation, there are completely new concepts of belonging, of boundaries, of mine and yours, and of collaboration. Businesses must therefore act and act fast. Many of them are already doing so, while others are trying. Many of them are aware that they have lost control of their own brand, which is passing into the hands of the people who are online – people who discuss their experiences, leave comments, and give criticism in more far-reaching, and more appreciated ways than traditional communication

initiatives and campaigns. As Chris Anderson says, we are no longer what we say we are but what Google says we are. The voice of the consumer has gradually become more important in the creation of the image and the reputation of the brand. A lot needs to be done to create an organization and infrastructure which are more in line with today’s economy and social context.

First and foremost, we must create infrastructures of emerging collaboration, i.e. infrastructures which have increasing returns. People have to be able to build trust and resources, they have to be able to organize themselves, they have to be able to solve their problems collaboratively (Fig. 3). This must be done through the integration of two worlds: that of traditional organization (which nevertheless remains necessary for defining responsibilities, plans and tasks) and that of new forms of organization and the emerging collaborative network, which are necessary for dealing with unforeseen circumstances. There is also a lot to be done on the external front – engaging with the client (fig 4).

We need to talk to clients. We need to stop shouting; we have to listen and understand how they use products and what they want. Companies can carry out “social marketing” activities, letting enthusiastic clients “infect” others. They can use social networks to generate sales, and provide customer care and innovation together with clients. There are also plenty of examples of this. We have to look at innovation from a new perspective, a less linear, less planned and exploratory perspective (Fig. 5). Networks are much more efficient at this than hierarchically organized groups, because when we explore something new we need to believe it, we need to have different points of view, we need to organize ourselves each time in line with the task at hand, and networks are much more efficient at this. Today is no longer about evangelization; that was the case years ago, when we started our project and launched the Enterprise 2.0 Forum in 2008. Today this has become mainstream. So what kind of company do we imagine? It’s an open, emerging and collaborative organization, in which we need to talk to people outside the company with feedback flows precisely because we are organized inside the company with similar flows. The organization can therefore do social media marketing, innovation/crowdsourcing, collaborative support with clients, and more.

We need courage, energy and faith in order to make this journey. But above all, we need to wear the right glasses, and look at new phenomena with new eyes. Only at that point will we discover that we have reached a new land of opportunities.


Chaos is simplicity that we cannot see yet


Organisations are conversations


Entropy is born from trying to use new tools to do old things, or from using old tools to do new things


E-mail has been overtaken by more open and emerging exchange platforms. Organizations should abolish their internal use of e-mail


When faced with ever more complex and inter-connected problems, decision-making architecture – represented by modern business and governance models anchored in a hierarchical command-control principle – shows all its inadequacy


The road must be the culture of risk: new perspectives do not open up without risks


Clients know the products much better than the companies that produce them


Those who work expect in some way to be able to participate in the organizational project; malaise is generated by the impossibility of this participation


In order to see new phenomena we need to build new tools of analysis and measurement


Organizations are living organisms. Even before generating products they generate and transform knowledge


The ability to generate and transform knowledge makes organizations emerge or decline in the knowledge economy


Knowledge is generated and transformed in conversations among employees, among clients and between clients and employees


Conversations go beyond walls and roles and favour relationships of trust that are difficult to condition


The weak point of knowledge management is the management


Collaboration is the challenge for modern organizations. We have only just begun to deal with this; the management tools currently available are inadequate for the purpose, as they were born in another era and for opposite objectives.


Collaboration does not (only) mean coordination, planning, and role management. Collaboration means putting collective intelligence to good use


Today we need to come together, create stories and common meanings, involve personal feelings, find ways to engage with people


Organizations that are inflexible risk extinction


High-performance organizations have disorganization and weak links as their strong point


There is much more intelligence in our organizations than management is willing to recognize


The intelligence in organizations today is trapped in procedures, customs and roles


It is difficult to direct a conversation; it is easier to feed it or silence it for good


An economic crisis is also a crisis of management models and work organization models


Today, man’s great works are born from conversations, and often they don’t need governance


The knowledge of organizations today lies more in connections than in company databases


Teamwork, integration, collaboration: organizations are cramming themselves full of concepts that are ever further from their own practices


The market today has a faster and more articulate intelligence than the intelligence of organizations


Organizations react to stimuli in their market with a speed that is inversely proportional to their size


HR’s plans hide the fear of freeing the energy and intelligence found within the organization


Clients, like employees, are looking for a contact and a dialogue but instead find rubber walls with high-sounding names: call centers, customer care, direct lines


Consultants strengthen the status quo: they try to bring complexity to the preestablished order but by doing this they increase entropy as they simply move the disorder to another level


Disruptive innovation does not occur in R&D departments: it occurs by mixing points of view and knowledge in new and open connections


One-way intranets are useless; Social Intranets can today become the nervous system that allows an organism to feel and act as a unit: they allow the exchange of stimuli, the accumulation of memory, the formation of identity and the coordination of actions


Today there is a need to come together: to connect the dots (vision) but also to connect people and create autopoietic (self-creation) systems


Reputation is the key


Centre and outskirts are concepts of the last century. Online, centrality is a function of authority and visibility


Listen, listen, listen: it’s the client who tells you who you are


In the knowledge economy you don’t have to know everything but you do have to be well connected


From the knowledge economy to the gift economy…


The business process emerges bottom up, learns constantly and adapts itself according to feedback from employees and clients


Think in a new way: abandon slideshows and restructure work spaces.


Listening to conversations is not enough. We need to draw meaning from them and direct change


Your employees come first. Without their involvement your Marketing department will never be able to engage customers


Consulting firms are not needed to build new organizations.


Ideas from clients, employees and suppliers are just as good as those from management


Social Business is not a new technology, it’s a new type of company


Looking at the market through the eyes of the product and socio-demographic segments has lost its value. Let’s seek out passions, needs, tribes


A company is centred on the client when it is able to look at itself from the outside, knocking down barriers both internally and externally


Bottom-up innovation does not mean carrying out everything that the clients ask for. It means understanding the problem that the clients want solved and helping them to solve it


Socializing processes does not mean creating new silos, even if they are social. It means breaking down traditional and social silos.


Only working for a wage never makes the difference. People today are looking for a common mission


Opening a Facebook page is easy. Opening the doors of a company and welcoming clients is difficult


Companies hardly ever know what the client wants because they have always been afraid to listen


Communities of people are not created and managed. Communities attract members and are cultivated by them


The new management model is closer to cultivating a community than to leading a flock


Change starts from the early adopters, but sustainable change reaches everyone else


Customer service is the new marketing


The only way to balance the excess of information in which we are drowning is by adding more information that acts as a filter


A group of kids has created more innovation in the last 15 years than IBM, Microsoft and Oracle put together

2.Social Networks and informal mechanisms of collaboration Under the pressure of a growing request for investment returns, companies have traditionally tried to automize or “re-engineer” their own business processes. This practice of revising the company takes the shape of a typically top-down operation in which the concrete application of the principles of benchmarking, six-sigma or lean production attempt to squeeze the small extra return from a company’s own business. Faced with this, in more mature companies awareness is growing that the application of this logic is no longer efficient, as it once was. New models of analysis and intervention are therefore beginning to be looked at, discovering within this the role of the “social” collaboration and connection mechanisms that are so widespread and sensational outside of companies. This article will look at how it might be possible to assess and better understand key factors of organizational performance – efficiency, key competencies of the company, the role of stakeholders and their involvement – through a perspective of organizational and social network analysis in order to reveal new opportunities for profit and effectiveness. We will explain these applications through some case studies that have involved large public and private companies (in Italy and abroad). There are many articles, papers and books today that loudly proclaim the power of networks within companies. Social software, spurred by the success of Facebook, Twitter, and LinkedIn, are starting to make their way into companies. In the attempt to come out from one of the largest recessions in memory, companies are starting to review their traditional management and work processes. This is not without good reason, as highlighted in the 2009 report by John Hagel for Deloitte, The Big Shift (, which pointed out some very significant long-term phenomena (from the last 40 years):

The continual increase of turnover and the size of the main companies listed on the stock exchange;

A substantial stability of the efficiency and productivity indexes;

The deterioration of ROA (Return on Assets) for big companies, a sign of a difficulty to make the most of their assets, firstly the human capital;

A loss of motivation and interest in their own work by approximately 75% of employed staff.

Most of these companies have entrusted the improvement of their performances to traditional topdown processes focused on methods to understand and identify inefficiencies. These methods inevitably generate more complex procedures and more rigid regulations that translate into the “malaise of employees” highlighted by the Deloitte study. It is therefore not surprising that social software – facilitating collaboration within companies – is seen as a positive experience by the workforce, but also considered in a manner diametrically opposed by management. The bottom-up approach, centered on people, for the improvement of performances is in sharp contrast with traditional logic (top-down) focused on the efficiency of business processes. And it is precisely here that the cause of existing tensions lies. The pressure on performances is such that more mature companies wish to experiment on new, non-traditional paths, in order to increase their efficiency and effectiveness. Many are closely watching Social Business movement, which today represents the attempt to bring the collaborative and enabling logic of social media both inside and outside of companies, seeking a better involvement of their clients and suppliers; looking at this approach as at the new era of organizational performances. If we look at the modern company of today, its complexity is very far from that of the industrial era. The ecosystem existing around and within the company requires a methodological system and a series of much more refined tools in order to understand how work needs to be carried out. If Business Process Analysis (BPA) is a technique suited to the company of the industrial era, Social Network Analysis (SNA) is the ideal technique for Social Business. BPA is a top-down analysis tool concentrated on processes regardless of people and their mutual relations. SNA is a

bottom-up analysis methodology concentrated on people and their mutual relations, largely independent of any pre-defined activity.

Metaphorically speaking, it is interesting to think of organizational analysis in the same way as a doctor analyzes a patient. X-rays are, for example, a rather effective tool that helps doctors to look inside the human body and diagnose a patient’s problems. In the same way, the tools of organizational analysis help managers to understand the company’s problems and to act accordingly. BPA is very effective for identifying the bones and skeletal structure: it can map the main roles and help to understand what problems they present. SNA instead represents a more sophisticated analysis method that is able to identify the complex muscular, tendon and nervous system. Similarly to an ultrasound, its results may not always be clear and defined, but it is able to trace aspects that are completely invisible to BPA, on which it is able to fully express its potential. In practice companies require both BPA and SNA in order to put in place an effective organizational scanning. The SNA ultrasound Thanks to the research works from the scientific community that deal with Social Network Analysis, today we have a body of methodologies, tools and experiments at our disposal for the analysis and

visualization of social networks both outside and inside companies. The maturity of the technology today allows us to analyze and visualize even very large social networks. A great amount of survey techniques has been developed to interpret the maps generated by an SNA. As with any activity that moves from a theoretical field of research to a widespread application, even in SNA, standardized approaches are being developed that may be easily repeatable and give back comparable results when applied.

Returning to the metaphor mentioned earlier, just as in medicine, where the doctor interprets and reads the data extracted from the x-ray and from a series of indicators to then refer everything back to the patient in a comprehensible manner, trying to convey the impact on the person’s well-being and physical health. Nowadays – where this technique is not yet so widespread – the number of specialists able to effectively interpret an organizational “ultrasound” is still low. However, the opportunity for growth which can be glimpsed behind Social Business is so strong that it could push even more structured and mature companies to explore this direction. What controls are usually available for managers to monitor company performances? What is generally of interest to companies in terms of monitoring their own health? What are visible even from the outside are the classic parameters such as turnover, profits, cost of sales or value of shares. But what is the value of those parameters inside the company? Which of those is the

invisible one that we could only understand through an organizational “x-ray”? How solid and deeply-rooted are our core competencies? How efficient is our organization design? What are the links of trust that maintain our company and govern the relationships – internally and externally – with our stakeholders? How much more effective could we be if we had the chance to see these things?

We will try to answer these questions by showing how a good number of companies, including in Italy, is drawing great advantage from organizational analysis based on the techniques of Social Network Analysis (SNA). How solid and deeply-rooted are the core competencies of our resources? The traditional approach for assessing competencies starts from observing the individual, his/her CV, profile, abilities and characteristics in an attempt to understand where there might be gaps to work on. Generally we tend not to consider, even slightly, the way in which the “experts” can be connected to each other. A very strong cluster of specialists – just to give an example – is able to have far more of an effective impact on the company compared with an isolated group (Fig. 2). In large industrial companies it is not rare to find strong concerns for the aging workforce and for the risk connected with the loss of highly technical competencies.

When a specific area is present that should cover most of the operational areas such as Quality Assurance (QA), it is not just the specific competency of that area that is important, but also how that competency is being effectively used to maintain relationships with internal clients (Fig. 3). On the map shown below, the Quality Assurance (QA) role shows the interactions with other areas. The size of the nodes reflects the relative demand for connections. It can be noticed how the Quality Assurance role is only primarily connected to four of the other areas. It is at a very low level in terms of demand, leaving the company plenty of room for improvement. In short, if it is believed that the people and their respective talents are the key to the value that the company is able to generate, SNA is the right tool to show how much these expert talents are connected to one another, but also if and in what way they are connected to the roles with which they should collaborate/operate.

How efficient is your company? If we look at the dictionary definition of “efficiency”, we can note two subject areas which are very different from each other. The first concerns machines and reads: “…the relationship between the work carried out (input) and the effect generated (output)…”; the other is much more centered on the people: “…the use of knowledge, abilities, competencies and capabilities to produce a result…”. It is not difficult to understand which of the two different definitions is more suited to describing today’s business processes. The first definition is certainly appropriate for describing

companies from the industrial era; but the world has moved on. Sharing knowledge is the platform that today’s efficient companies are based on. Over 50% of work requires knowledge to be shared with others – through activities of problem solving, generating new knowledge/innovation, cooperation, operational support, etc. – contrary to the industrial era when most of the work was based on individual competencies and individual contribution. One of the tools most used by managers for enacting positive change in their own companies is the organizational structure. Continual efficiency research pushes them to divide, segment, structure: customer services, production, marketing, the hierarchical level and any possible combination of these. And then to rebuild cross-cutting coordination and integration structures; specialist areas, product lines, market areas, specific task forces… Unfortunately the effects of these activities on efficiency can only be measured retrospectively: that is, once the external analysis metrics become available. So how is it possible to look inside the company and try to identify how effective its organizational structure is? BPA can measure intra-unit flows and simulate work flows by using sophisticated modeling systems. These techniques are extremely expensive and long in terms of both economics and resources. SNA can identify how the work is actually carried out on an operational level. Starting from the assumption that efficiency is strictly connected with the effectiveness of sharing knowledge in the company among different business units, it is possible to draw up a budget of how knowledge is shared within the company by looking at the supply and demand between the different areas of work. If the demand – ideally – is balanced between the different BUs (and there are therefore no overloaded or underloaded areas) we can declare state that the company is efficient. Inevitably however some organizational units will be discovered to be overloaded with demand whereas others receive very little compared to the knowledge that they could, potentially, circulate. Both situations deserve thorough analysis. In order to illustrate the way in which SNA is used to assess organizational efficiency, the method has been implemented with the IT division of an important major Italian bank. Figure 4 shows the balancing of supply and demand and has been used to identify which of the 40 organizational units analyzed had a greater variation both in terms of the excess demand that the

business unit directs to other units (value sink), and in terms of the excess demand of the business unit on a specific unit (value source). Neither of these extremes is sustainable if we intend to reach maximum efficiency. Value sinks ask a lot of other units and give back very little in return. Value sources – although they may appear as more positive – risk becoming bottlenecks that slow down the entire organizational efficiency and must likely lean on other resources in order to satisfy the requests they receive. The organizational units that have been identified in extremes in this analysis must therefore be subject to a careful review that may increase the overall level of efficiency. But what are the reasons behind these imbalances? For value sinks; perhaps they are due to a lack of competencies or experience? Or a lack of visibility? Are they in fact too rich in resources (overstaffed) and do they create phantom demand towards other units? For value sources; is the demand from other units high because they lack competencies, abilities, resources or – perhaps – delivery capabilities? Do they deliberately avoid turning to other units for operational support? In summary, organizational inefficiencies can have a very rapid impact in terms of ROI. Organizational units that are under or over staffed can be masked from directors’ eyes. BPA analyses can be intrusive, costly and time consuming. Through SNA, with a very modest effort, the keys to inefficiency can be quickly identified and corrective actions can be put into place.

How efficient are we at involving our stakeholders? When companies talk about their stakeholders they often refer to external groups like their clients, suppliers or even communities in which these groups operate. In today’s companies the term can also be applied to internal organizational units that are to be involved in the company in a crosscutting way rather than in a hierarchical way (as tradition would have it). Fundamentally what we desire is to have relationships of trust with our stakeholders, both those inside and outside the company. The traditional approaches of involving stakeholders concern the identification, categorization and, subsequently, a communication strategy tailored for their effective involvement. However, nowadays the number and size, in addition to the complexity, that a company can reach make this procedure take on rather discouraging characteristics. For companies operating in the public sector, all of this is aggravated by the numerous members of staff in contact with external stakeholders. SNA methodologies are in fact an excellent tool for making the “ecosystem of stakeholders� visible. SNA is able not only to identify direct relations between individuals inside the company and stakeholders outside of it, but also to trace relationships that external stakeholders have with other

external stakeholders. This much richer snapshot can be a tool that is notably better for understanding the real impact that stakeholders can have on performance. To illustrate the involvement of a company’s external stakeholders we have used the example of two cases taken from the public sector: the first is a regional board from the United Kingdom, whilst the second is an Australian social service whose objective was to better understand the complex network of relations it had in place with numerous non-governmental organizations (Figure 5). In both cases, complex questioning of all of the external shareholders was not economically and feasible, and therefore SNA seemed to be the ideal solution for questioning the internal staff in an attempt to understand with whom regular interaction occurred. For the board from the United Kingdom a survey was prepared for the internal staff (the white nodes shown on the map) and a selection of external partners who could be involved in the ecosystem of the stakeholders. In this map only strong relations are shown. What is immediately clear is that the map could be much more vast and complex and that establishing a priority on the stakeholders is needed. This activity was conducted by the Australian Agency by characterizing the stakeholders according to their potential influence on organizational performances and on the support that they provide to other members of the company. Based on the results of the survey, the stakeholders have been classified in this comparison matrix which highlights their positioning (and the priority for action) compared to the support and influence that they have on the company. The size of the circles represents the attention that is given to the stakeholders. It is immediately apparent which of the stakeholders requires greater attention (Opponents), which require more support (Promoters) and which instead might potentially receive less information (Minority). In summary, SNA can help companies to visualize their complex network of relations with stakeholders and make those who require privileged attention emerge. All of this not only helps the company’s internal efficiency, but it also builds a new revenue system and ROI that allows value to be built through the growth of the reputation. Conclusions

We have seen, in recent or very recent times, how the power of social media has helped presidents to be elected and long-term dictators to be overthrown. In this article we have identified how even more mature companies are starting to explore the value and potential of Social Business within their own walls. To do this they are starting to move towards to the classic methodologies of SNA, a true organizational ultrasound able to make real dynamics emerge within their own companies and leverage the power of networks and communities to improve business processes and organizational efficiency. We have then illustrated, through some examples, how a company’s key problems (involvement of stakeholders, core competencies, efficiency of individual organizational units‌) can be understood and resolved by using new analysis techniques taken directly from Social Business. The new indications that come to us from these techniques push us to rethink the traditional metrics connected with ROI and with the return for shareholders.

3. Providing new maps for Governance For decades business process mapping (BPM) has been the starting point for analyzing work processes. Total Quality Management, Lean Manufacturing, Six Sigma, and Business Process Reengineering are all methods of work management that have the “Business Process” as their point of reference – and centre of attention – for business improvement. When we try to break down the “Business Process” term we realize that its usage stretches far beyond the mechanical workflow processes, ideally pointed out by BPM techniques. For example: are the subtle negotiations between a seller and a customer adequately represented in a process map? What about the relationship between a social worker and client, or its network of reference? And what about the network that inspired the sale of Apple’s entertainment products? The understanding of a university professor’s lesson? The treatment from an expert doctor? We can of course describe the above operations in terms of business processes, but in order to improve such processes we need to go beyond traditional mapping and analysis methods. Stabell and Fieldstad in their pioneering work on “Value Chains” identified how business value can be generated through methods other than those of traditional simple process analysis. They also introduced the concept of “Value Shops” to satisfy the business processes driven by experts, such as medical centres, law firms, consultancy companies or research institutions, and “Value Networks” for businesses that thrived on client interdependence, as in the case of telecommunications, banks and entertainment businesses. All of these alternative business models have traditional process chain activities, but in no way do these activities represent the key process. Subjecting these models to traditional analysis techniques essentially means improperly using available resources, thus running the risk of not achieving satisfying results. So if your business is not centred on Value Chains, what are the alternatives? Two mature approaches are used to analyse businesses related to Value Shops and Value Networks: Social Network Analysis (SNA) and Value Network Analysis (VNA).

SNA is able to identify the people within your organisation that others depend on in terms of work processes, information and support. In this sense SNA does not mean a method that simply covers technical expertise. In fact, in our experience, SNA has often uncovered matters related to organisational expertise, i.e. to those competencies that answer the questions: “how can we make sure that things work around here?” or “how can we make sure that the procurement system works for us?”, which also help to understand the relationship channels between your experts inside the business and the rest of the organisation. This is similar to a BPM for the more mechanical processes and offers the same level of analysis and benefits. SNA can provide information both on Value Shops and on models based on Value Networks. VNA can underline – from its perspective – Value Networks and Value Chains by pointing out the client interdependencies and shaping the tangible and intangible flows that connect the different “roles” within the organisational network. SNA works, therefore, at the personal level and VNA works at the role level. There is a gap between the two analyses that allows us to observe how organizational roles interact at the more personal level than at the work process level. We call this analysis gap Organisational Network Analysis (ONA), which simplistically can be traced back to an SNA with the

“roles” as the network nodes, instead of the individuals. It differs from VNA because the connections between roles are not detailed and explicit like value flows, but simply identified by their degree of inter-role dependency. ONA can be complementary to both SNA and VNA and can address, in different ways, all three value configurations (figure 1). In this document we will introduce the concept of ONA and illustrate it in detail with a case study. Where would ONA be used? Over the years we have conducted numerous SNA and VNA activities. These investigations were not only limited to Value Shops or Value Network businesses but also to Value Chains. Inevitably there are elements of both techniques that can limit the choice of adopting them. For SNA, for example, reluctance is typically connected with privacy issues and the presence (or non-presence) of some people within the social network map emerging from the concluded analysis may be observed as “uncomfortable”. All of this can be mediated by avoiding showing the names of people on the map, but we must not forget that an SNA in fact asks people to mention individuals by name. For VNA privacy is not a problem as the unit of analysis always refers to the “role”. Tangible value flows within the map created with VNA are familiar to those practised in traditional analysis techniques. Intangible value flows are instead often related to people – or centred on relationships – which can be perceived as “foreign” by VNA participants and can take some time to practise before they are acquired. As in BPM, the entire mapping process can be time consuming as each individual role is analysed for the contents of its value flows. All of this can often limit the level of organisational analysis that can be achieved.

By considering ONA as a meeting point between SNA and VNA, it is possible to achieve the benefits of both approaches while avoiding many of the limitations. ONA is essentially an SNA conducted at the role level. Participants are asked to nominate “roles” rather than “people” they depend on for performing their job correctly and well, together with the degree of dependence they can have on certain roles. In this case, the privacy issues that emerge with SNA are therefore avoided (or at least they are for roles that have more than one occupant!). It is also much simpler (especially compared to VNA) for participants in the analyses to indicate the roles they depend on and refer to for their work processes. The real positive side of ONA is that it could be much easier for organisations to adopt, given that it does not require the long analysis and processing time of VNA and it does not interfere with privacy and personal issues of employees, thus avoiding becoming an “uncomfortable” and expensive procedure.

We therefore deem that ONA is best placed to be adopted by organisations intending on doing a quick and broad organisational analysis that goes beyond simple business processes. It will typically be Value Shops and Value Networks that will be able to benefit the most from ONA, although Value Chains could also be positively influenced by it. ONA can highlight these aspects in a much faster and more efficient manner than analysis processes such as BPM and VNA. ONA Case Study The best way to illustrate how ONA works, along with its actual benefits, is through a case study (figure 2). For our case we have chosen a large financial organisation with over 120,000 employees. The project was focused on the Information Technology Services department of over 4,000 people. Problems related to privacy and the protection of employees prevented the department from adopting a traditional SNA. The classic procedure was therefore adapted to ensure that people could nominate “roles” (and no longer nominate “individuals”) that they depend on to efficiently and effectively carry out their own work. The roles were therefore analysed at multiple levels by observing, on the company’s organisation chart, the links connecting them directly. At the top level 8 service line roles reported directly to the CIO. At the second level there were 44 business units, below which were 200 activity roles. All of these roles were well documented within the department and each service was detailed in an operations manual. The work process

As could easily be envisaged, by a top-down management organisation, the department has performed a considerable job over the years of identifying the roles and breaking them down precisely into responsibilities and tasks. However, what were not taken into consideration were the (informal) peer-to-peer exchanges within the business. One of the main objectives of the ONA was in fact to highlight these peer-to-peer exchanges within the company. The questionnaire The initial study collected results only at the management levels (for a total of around 200 officers), with the intention of broadening the research at a later stage. The survey was structured so as to present activities belonging to the business units, which in turn depended on service lines, and the organisation was therefore described in classical hierarchical terms. Respondents could, however, nominate any other role – including from other areas – that they interacted with in the performance of their work, and they also had the possibility to indicate the degree of important of that interaction. The questions on interactions concerned: •

Daily operations (day by day);

Problem solving support;

Information sharing;

Desire for more contact.

As the organisation was described in hierarchical terms, a report of a connection between two activities could infer a connection also between a business unit and service lines, thus facilitating analysis at different levels. In practice, however, the limited sample of 200 respondents meant that the analyses at the activity level were less significant and made it clear that a larger sample would be required.

Mapping and Analysis The ONA results have shown data on relationships among roles and on their dependency and the strength of the links. At the highest level, the relationships are defined as a “critical dependency” of one role on another. Such links can be reciprocated, indicating a bilateral dependency of two nodes of the network (i.e. when one depends on the other and vice versa). Figure 3 on the previous page shows the dependency links between the role activities for the daily operation relationships. The nodes represent a role activity, coloured based on the service to which they belong. The size of the node reflects the number of “mentions” received (in-degrees), underlining the importance of the node: the more a node is requested the larger it is on the map. In this case the map only shows the critical dependencies. What is immediately noticeable is the difference between the mapping produced by the ONA and the organisation diagram typical of process mapping. As we can see the map is not at all structured and shows a lot more connections than those highlighted by the organisation chart. While we can see some areas grouped together, we can notice that the connections between service lines are not as structured as they would seem. So the question is: which is closer to reality: the organisation chart, the business process map or the ONA? Business process mapping, when used for functional improvement, is intended to represent the performance of working processes. The analysis of the “as-is” situation is then aimed at providing

the opportunity to design strategies from which the “as-is” processes can be adapted or even removed in order to improve the organisation’s performance. But what happens when the “as-is” representation is only a false reflection of what is really happening? In an organisation based on the Value Shop style a Business Process Map could effectively show, as we have said, a patient’s stay in a medical centre, but it is very unlikely that it would be able to show the critical dependencies between roles in the centre relating to information, experience or knowledge flows existing in the organisation. In an organisation based on the Value Network style, BPM would only be able to identify linear flows, inevitably missing all the critical feedback or connections that exist in reality. Even the most sophisticated business processing tools are used to collect feedback and to facilitate the modelling of processes, and we can verify the possibility of collecting these data with classic techniques, soon realising the level of complexity that the analysis would require. So what innovative techniques would an ONA offer? The final objective of an ONA is no different than the objective experimented with a BPM: the search for interventions that are able to improve working flows within the business and lower costs by increasing the quality of products or services offered. The analysis techniques and the related methods differentiating the two approaches are shown in the following table: BPM Analysis Techniques Mapping of transactional flows

ONA Techniques Mapping of dependence between network nodes

Starts with “stock and flows”

Starts with relationships among people

Looks for inefficient flows

Looks for complex interactions and interdependencies

Analyses capacity and use

Analyses capability and involvement

Optimisation has a mathematical

Optimisation has a behavioural



As the table shows, ONA is an approach much more centred on people than BPM. The success of this type of analysis is enhanced for all organisations that are focused on relationships among people and on the supply of services, such as the medical, legal, financial, educational or social work sectors, which, as we know, nowadays dominate the most advanced economies. The following analysis techniques, applied in this case study, have been adapted or extended by consolidated and largely tested SNA techniques, and re-studied specifically to be applied to the organisational context. Demand (and supply) analysis The network diagram shown in figure 4 identifies the connections between roles by directional arrows. If role A is pointing to role B it means that someone in role A has nominated someone in role B as a “critical” connection for him/her. From a supply and demand point of view we could interpret this context as role A as demander and role B as supplier. In this sense, the roles that have many recurrences (called “in-degrees”) are high in demand. The following table shows which of the 44 business units were most in demand by the observed network. The business units most in demand can be easily represented as bottlenecks. In fact, a simple efficiency measure of a company could be calculated and guessed simply based on how much the work is spread out within the organisation. Criticality analysis Networks placed where there are concentrations of demand on only a few nodes suggest the presence of critical units that are potentially at risk of becoming bottlenecks in the organisation. We can measure and carry out benchmarks of these bottlenecks by making an estimate of criticalities (figure 5):

We can notice how 27% of activities correspond to 50% of connections. Although we would not expect all activities to be equally in demand, this diagram provides us with a scale of the organisation’s robustness. For example, if we found a business in which the main activities (10%) represented 50% of the connections, we would have to deduce that the organisation in question was much more vulnerable (from the point of view of achieving inferior performance) than the company that we examined in our case study. Value Sources and Value Sinks When we look at a map of an organisation from the point of view of supply and demand of value, it is possible to understand how various roles and the activities they perform relate to each other by identifying the roles from which there is higher demand for help and those which supply more help. If a correct mapping is carried out, it is also possible to identify the balance of the company by identifying the Value Sources (those in demand) and the Value Sinks (those who demand). Figure 6 shows a map highlighting the connections between nodes of the same network in relation to supply and demand. In this case the colours identify the Value Sources or the Value Sinks. The size of the nodes depends on the number of connections and the thickness of the linking lines identifies the strength of dependence. Value Sinks are roles that tend to demand more than they supply, whilst the opposite can be said of Value Sources.

What should we try to deduce from this analysis? On a first, more superficial, level, we can note that Value Sinks are negative because they drain energy and demand more than they supply, so they require constant work. On a second level, we can understand how even Value Sources, if too strong, can be negative. This is because the widened size of one of the nodes shows a lack of capability to respond effectively and efficiently to the organisation network. And perhaps a lack of capability could be due to a lack of desire to draw knowledge from other sources. In this case study, showing the analysis results to individuals in charge of the organisation caused a considerable amount of discussion, also due to the fact that an ONA had been conducted for the first time. We highlighted for the executive committee the example of the change management unit as a Value Sink, which appeared as a node able to absorb large resources compared to the amount it supplies. The CIO informed us that the unit had been broken up just a few days before, suggesting that the analysis conducted was valid.

New visions and future implications We have already underlined our belief that ONA can be a useful method able to provide a detailed business process analysis without wasting excessive resources, especially compared to BPM and Value Network Analysis. The analysis of Value Sources and Value Sinks allowed us to immediately identify the areas requiring a more detailed analysis or a greater amount of attention than others. When we identify

some business units as Value Sources or Value Sinks, we can ask ourselves why our business has assumed this organisational dimension. For example, we can review the competency level of the individual units that have been identified as Value Sources or Value Sinks. Figure 7 suggests some possible improvement interventions for the Value Sink/Value Sources issue. A low competency Value Sink can be explained in light of a new position, of a new hire or in any case of any skill-set being formed and that is still gaining the correct competencies to interact with the other roles. The action to take could therefore be to support the role (in terms of time and competencies) in an attempt to make it become more efficient. If the Value Sink is instead highly competent, it is possible that it is not so visible – or accessible – within the organisation and a possible solution could be to promote its role or review the network configuration. In other cases, such as the Change Management Business Unit of our case study, we could consider breaking up and reassigning that role to other roles. As regards Value Sources with low competency, their roles should be trained and helped to access different roles, so that they can improve their own competency and grow. If the Value Sources are already competent it is therefore possible that their existing resources are insufficient and the demand cannot be efficiently met. The ONA results can also be usefully used to focus on the processes and activities carried out by Value Networks. A specific focus on the interaction with a good number of Value Sources and Sinks is likely to provide the best return when applied to these complementary analytical techniques.

Conclusions We have presented Organisational Network Analysis as a technique to review the approach to Business Process Mapping and more focused on the personal and organizational dimension. We have called these new business models Value Shop and Value Networks, which are much more dependent on the optimisation of the processes within them, on the general improvement of competencies and on the certainty that information and knowledge are truly shared within the whole organisation. In cases like these, simply mapping the work processes prevents us from grasping the real essence and concrete configuration of the business. We have distinguished ONA from SNA suggesting that, by maintaining the focus on the role, rather than on the personal level, organisations were freer to operate without running into legal constraints caused by the management of employees’ privacy. The case study was used to show how a simple application – on a limited sample – of ONA is able to provide useful information for interpreting the organisational context and the functioning of processes at multiple levels of association. Through a simple analysis of Value Sinks and Value Sources, businesses can easily identify internal problems and take quick action in order to curb them. Alternatively, it provides a

valid starting point that can be crossed with other analyses already experimented with, such as Value Network Analysis and Business Process Mapping.

4. Social Business Process Reengineering From Taylor to Drucker. In a famous quote, Clay Shirky, lecturer at New York University and author of Here Comes Everybody, wrote “Process is an embedded reaction to a prior stupidity” [1]. In other words, a process is nothing more than the coding of a lesson learnt in the past, transformed into a standard by a group of experts and established as a mandatory flow those who must effectively carry out the work. Joking aside, one of the themes that never seems to be missing from the agendas of top management, even more so in times of economic crisis, is that of efficiency, of doing more with fewer resources, of optimising flows, of improving work processes of individuals and entire departments. This is the field of BPM (Business Process Management), a domain worth many millions of dollars [2] at the centre of thousands of reengineering projects. These initiatives often have a considerable impact, with returns in 77% of cases higher than 15% of the investment [3] and in any case positive 2 years on from the project for 72% of interviewees [4]. Among the areas that fall under the protection of process auditing projects are the automation of repetitive tasks, the reduction of resources and time necessary for the completion of activities, compliance, the monitoring and management of performance, the increase of the productivity of employees, the greater consistency of the client’s experience. What have we really optimised with these initiatives? The most fashionable approach over the last decades with regard to the optimisation of how a company works has been to formalise and control, starting from the assumption that the work to be carried out was mostly theoretically predictable, describable in simple, measureable and improvable terms, concentrating itself in a surgical manner on individual steps. Unfortunately these sorts of concepts, deriving from the scientific management and industrial society of Frederick Taylor’s time, are unlikely to combine with a post-industrial economy ever more based on creativity, on the sense of belonging, on a global communication amplified by social media, and on the rebalancing of power between brands and clients’ communities.

The inadequacy of today’s organization in dealing with a world based on knowledge, unpredictability and constant change is shown, for example, by the following figures: •

Whilst 95% of IT investments are today still focused on the automation of business processes from the point of view of cutting costs, a good part of employees’ working time is not spent on the process, but on the exception to the process [5].

Despite the countless past optimization initiatives, in knowledge intensive sectors there still remains a performance gap of 9 times that of sectors centred instead on production and transactions [6].

Only 5% of companies have provided practically all (more than 90%) of their own knowledge workers with technological support [7].

It is estimated that between 20% and 50% of collaborative work is inefficient or entirely wasted [8].

As these figures imply, what our organizations have learnt to identify, codify and automize perfectly over the years are the “easily repeatable” [9] work flows, oriented towards the large volume of transactions that are repeated with precision in time. Information systems and management mindsets have on the other hand still not been able to fully protect the “barely repeatable” processes, i.e. those that include human beings within fluid, unstructured practices, typically based on email exchanges, meetings at the coffee machine and a wide discretion of behaviour by the parties involved. A mandatory approach, of description prior to the flows, is ever more in crisis against the increase of the uncertainty and volatility of the market, of intensified competition, of the need to differentiate oneself, and of the reduced capacity of control companies have when dealing with the social customer. With the potential hidden in easily repeatable processes having been exhausted, the current challenge is moving towards the optimization of increasingly difficult sizes to be automized as innovation, knowledge, and reactivity to change; from the “one best way” of Frederick Taylor to the knowledge workers of Peter Drucker [10].

The seeds of collaboration in processes How can we evolve our current approach of pure automation of processes by including co-creation, bottom-up exchanges, and participation from all individuals within and often outside of the organization?

According to a recent study on the evolution of the organization [11], in the next 3-5 years the introduction of collaboration within traditional processes will be so disruptive that it won’t stop at making the work more efficient, but will rather cause a much more profound change to some of the fundamental meanings that the business is based on: •

35% of interviewees think that the line between employees, suppliers and clients will vanish.

32% think that teams will be able to organize themselves and decisions will be based on the most complete availability of data rather than on personal opinions.

27% think that the organizational hierarchy will level out or large organizations will disappear altogether.

According to other interviewees, the allocation of resources, the strategic priorities, the choice of individual tasks and the assessment of performances will come directly from their own peers.

In order to spot in very small steps such a long-term transformation, organizations have already started employing approaches and collaborative tools, recovering a bottom-up contribution within a multitude of business processes. As many as 43 use cases with which the market is making comparisons (Figure 1) emerged from a study by Constellation Research [12]. Going through the roles directed both within and outside of the company, the areas in which collaboration is moving the fastest are: •

Customer Service and Sales, with 6 use cases oeach among the top 20 most voted.

Human Capital Management (3 use cases).

Marketing and PR (2 use cases).

Project Management.

Along with topics that are already mature, some other more recent ones have emerged from them in the areas of product innovation and development (PLM), in the introduction of social business to auditing (Finance) and in relations with suppliers (Supply Chain).

What benefits are the companies that launched themselves into socializing processes on the hunt for? In the search for an organization more centred on the needs of the individuals and connections in network methods, combining structure and bottom-up participation allows us to: •

Recover and pool the wealth of tacit knowledge, and of non-codified knowledge, locked in drawers and in the minds of individuals but so indispensable to how the business works. This is a universe of competencies, experiences and complex notions that requires a relational context of trust and high commitment in order to be shared voluntarily.

Acquire flexibility when faced with exceptions. According to approximately 50% of the work force [13], the processes on which the company has so far spent a good part of its budget, in addition to not covering knowledge work, often impose excessive inflexibilities, resistance to adoption and time wasting which paradoxically prevents the achievement of the very business objectives that they were codified to reach.

Respond to change. The volatility and globalisation of the market are drastically undermining the stability of processes with changes that in 66% of cases become necessary in the space of weeks or months. In addition to balancing the rigidity artificially imposed by the process, collaboration adds unclear margins of freedom to work individually or in a team.

Make collaboration measurable. The difficulty of measuring intangible exchanges exactly has always represented a large barrier to the recognition of the value of collaboration by senior management [14]. Immersing collaboration in a work flow a prioriallows us to easily measure the difference between before and after, making tangible the improvement contribution brought by employees and clients.

Transfer autonomy and responsibility to line workers. Relaxing the process ultimately means allowing operators that directly interact with the client, or employees that, in

whatever hierarchical position, intercept a problem, to timely take the actions necessary to deal with the emergency. This autonomy not only makes the whole organization more agile and receptive of signals (including unexpected ones) arriving from the outside, but above all contributes to motivating and making aware of their responsibilities all members of the organization who feel more able to do what is right for the client and company. It is precisely in order to respond to the changing market needs that the world of BPM is tending towards more flexible, emerging and adaptive practices such as Dynamic BPM and Adaptive Case Management [15].

Socializing the extended value chain How can collaboration, circulation of information and active participation of all stakeholders be applied in a precise, coordinated and integrated manner within the whole value creation chain? There are 4 stages of maturity for the socialization of the value chain originally proposed by Michael Porter [16] (Figure 2):


Isolated communities outside of the flow. This is the starting point for every company when they begin to test the participation of clients, employees and other actors within the ecosystem through bottom-up communities or in any case communities free from the pre-existing work flows. The initial investment is low, as there is no integration, but the project struggles more to reach a critical mass of adoption and the tangible returns are very difficult to measure.


Communities outside of the flow supporting a traditional process. The next step consists in recognising the complementarity of communities and processes by supporting a work flow (which remains unchanged) with social tools able to capture exceptions to the process, uncoded exchanges, and the tacit knowledge necessary to make the process itself work better. Structured and unstructured work are not yet integrated, but only supported. The returns become more tangible because it is possible to measure the benefits along the process, but the users experience the inconvenience of having to change context in order to carry out their work (traditional process) and collaborate (community outside of the flow). Adoption is at risk.


Socialized process. To guarantee adoption by the users, the traditional process and collaboration need to be brought together by offering a single place in which all activities are carried out. Comments, posts, status updates, and documents are finally placed in the work flow, simply as an additional facility of the old system that becomes social and possibly integrates into the internal and external communities of interest (e.g. online support communities for customer care, CRM product communities). The processes, as socialized as they may be, remain closed silos, supported by technological solutions that do not speak to each other. We will have a vendor for Social CRM, a vendor for Social PLM, a vendor for HR 2.0, etc.


Integration of socialized processes. Much more can obviously be done than creating a multitude of separate processes, even if enriched by collaboration. The starting point consists in pooling a series of services necessary for all processes like collaboration,

unified identity management, business intelligence, activity stream updated by all systems. By doing this, not only does the participation occur in the context of the process, where it can affect and guarantee more consistent returns, but all processes begin to produce updates (status updates) that come together in one flow, similar to what happens in Facebook profiles. Through these streams individuals can stay up-todate in real time on everything happening in the company [17], but above all they can collaborate at the same time on those events (e.g. by commenting on them, adding information, starting a video call) and provide feedback to the process (e.g. from the stream the state of a commercial opportunity can be changed in the Sales Force Automation system). Currently many organizations and technology suppliers are still locked into a vision of communities and participation that is disconnected from the nervous system of the business (Stage 1). Cleverer organizations have instead already completed projects in which collaboration is considered an accelerator of work flows (Stage 2), in some cases replacing the automation of the process with more dynamic and open approaches (Stage 3). However, it will only be over the next few years that information systems and management practices will start to look at business socialization in a holistic manner (Stage 4), no longer settling for acting with a local perspective on opportunities to improve the individual department or flow, and instead systematically rethinking all of the mechanisms of value generation in a framework in which collaboration is the glue and enabler of sharing [18]. In the following paragraph we will see two projects whose maturity is in Stages 2 and 3.

Rethinking the processes in practice In this paragraph we will show concretely how it is possible to involve the whole organization in improving a process thanks to the introduction of more transparent, participative and contribution emerging methods, aiming not to break up, but to evolve the paradigms of value creation which are

today more widespread and to bring aboard both collaborative exchanges and exchanges which are more strictly transactional. The business context. Systematizing previous experiences with the tools of Web 2.0, Lago (a rapidly growing furniture company from North-East Italy) intended to design a consistent strategy for product development socialization, firstly involving employees and at a later stage also resellers and clients. In contrast, a leading international organization active in the manufacturing sector wished to improve its project management activities by applying a lean methodology and guaranteeing an emerging interaction in real time between distribution teams on continents far away from each other. Business objectives. Although different in size and complexity, both interventions were aimed at an overall maturation of the business on the organizational, cultural and technological plan. In the first case the greatest challenge was extending the active participation in the collaborative exchanges to all the members of the business, management first of all, making a single solution available that was simple to use and able to direct all of the available contributions and competencies into the product development path. In the second project the biggest barrier was instead cultural, looking to extend the organizational context to one effectively able to include sensitivity, needs, know-how and documentation relating to distant teams and sites. In both initiatives, technology, organization and the planning path jointly contributed to making emerge not only a new process, but also a new way of working. Intervention methods. By using a planning and collaborative approach, inspired by listening to the needs, to the facilitation and co-creation of a shared solution, socialization has followed the following path: 1.

Definition of objectives and business priorities without omitting any fears, resistances and cultural obstacles to be considered.


A group of friends (composed of approximately 30 stakeholders and final recipients of the product system) were involved in a co-design activity in order to map the current

process and imagine its enrichment through bottom-up contributions, collaborative spaces, greater responsibility of individuals, and greater transparency. 3.

The indications collected gave rise to a socialized process supported by an appropriately configured community environment filled with contents.


A closed pilot was created as a result, which all departments affected by the process were invited to (e.g. Technical Office, Purchasing, Sales Network, Post Sales, Call Centre, Marketing, etc.).


Through a daily activity of communication, cultivation, creation of new contents and facilitation of horizontal exchanges, participants began to understand the value and adopt new work methods which replaced the old process.


Based on the feedback collected during the pilot and with the help of the word of mouth generated by the group of friends, the project was extended to the whole organization.


Thanks to a business case for management, the same method was autonomously repeated on other processes.

Results obtained and project metrics. As has already been mentioned, applying collaboration to improving a process facilitates the measurement of results that are tangible and that can be communicated to management. For Lago the results included: •

Greater speed with a reduction of 70% in the time taken to reach decisions on product development;

Greater reactivity to market signals with a reduction of 40% in the time taken to activate the points of reference necessary to implement technical changes;

Greater efficiency thanks to a cut of 90% in operational and alignment meetings;

Greater quality with an improvement of 40% in the accuracy of business decisions.

Beyond formal metrics, both projects brought a long list of benefits which were perhaps less tangible, but certainly just as important, such as: •

The reduction of misalignments between departments (e.g. Technical Office and Purchasing);

Greater ability to quickly identify the correct internal points of reference;

Creating a mechanism for learning and professional growth that is always up-to-date and free of charge;

A greater awareness of the role, experience and possible contribution of each individual, in any part of the world;

A constant alignment on the state of progress, partial products and final outputs of projects;

The reduction of the quantity of e-mails and effort necessary to coordinate teams;

A more transparent recognition from a meritocratic and future reuse perspective of individual efforts and unexpected results emerging from collaboration;

The possibility to rebuild at any time the whole story of the interactions around any project through a single environment.

Future Directions The introduction of collaboration, knowledge exchange, and the collection of feedback within work flows is changing on various levels the way in which companies operate and generate value for their clients. For some realities it is simply a case of making available community environments that support the process. For others it is the same processes that change, including mechanisms able to guarantee not only the fluid completion of transactions, but also a broader contribution by users. Finally, in more advanced projects, what is being created is a strategic design in which social elements are the key to reducing silos and systematically putting data, people and all the processes involved in the operational contest in communication.

Whatever the approach chosen and the level of maturity reached, the convergence between horizontal participation and traditional work management paradigms, between hierarchy and bottom-up communities, between mechanisms structured by the coding of activities and making the individuals more responsible for the success of the business, are long-term trends that will

continue to push for a thorough review of the fundamental meanings of management, leadership and governance of any company.

We believe that the concepts presented in this chapter, although preliminary, provide a glimpse of a concrete movement of organizational evolution that is indispensible for responding more effectively to both the challenges coming from the market and the need for motivation from those who operate inside the company.

..................... The importance of collaborative business processes Interview with Sameer Patel

Why is connecting social elements to business processes so important for organizations? Connecting people to other people has always been of fundamental value to social/collaborative approaches and tools. The reality however is that most users of social applications are still forced to jump continuously between environments free from engagement (the communities), record management and e-mail. Whilst we work we encounter exceptions [19] every day that are not adequately supported by systems for managing available transactions, whereas social tools are still too abstract to support the traditional flow of incoming and outgoing activity. The two worlds are not communicating with each other. When we stop looking at Social Business as a final aim, but rather as a means to a production objective, we will begin to see how business processes need collaborative methods to manage these exceptions: at a basic level, by helping people to find the best colleagues who provide help and, in its optimum form, by enabling not only colleagues, but also the best practices to emerge and by applying a business intelligence capable of accelerating the company results. I consider the latter as a second version of Social Business. We are currently in the initial stages of this version.

Can you give me some examples of areas in which this socialization of business processes is happening and the benefits that it introduces? We are only at the beginning, but organizations are starting to understand the need to enable collaboration to emerge in the context, right where the work occurs. In SAP, our company applications have fed critical processes for transactional management for decades and we are now discovering that these processes are the most efficient points of contact to ensure that the social and collaborative approaches produce company results. For example, the planning of Sales and Operations (S&OP) is a fundamental activity for almost all large organizations; it must satisfy the demand based on production forecasts and its result amounts to millions of dollars of commitment in expenses and returns. During this activity a cross-functional group of users must gather to give input. What could appear as an exclusively transactional process is in reality highly collaborative and subjective. We need the right type of collaborative metaphors in order to reduce the risks, and our clients are asking for a better solution to make this process more accurate. The same applies to the management of Governance, Risk and Compliance or for the management of relations with suppliers and many other processes. Shutting collaboration in its own silos by merely connecting people does not respond to similar highly critical company processes.

What is the biggest barrier to incorporating collaboration into daily activity flows? The biggest obstacle is looking at this process as an “incorporation of collaboration”. The first wave of business applications trying to make the most of social approaches have incorporated feeds and separately linked collaboration to each functional unit. The reality is that when we look at the “day in the life of…” scenario for each kind of user, we begin to understand what is really needed to make all of this useful. Let’s take for example the scenario of a salesperson: the person needs to use CRM to manage leads, unstructured systems for the access to and creation of documents, an order-to-cash system to launch products and to be paid, and much more. We need to understand objectively how collaboration can play a role in this scenario – from the qualification of the leads to the verification of the commissions. This is the strictness and the understanding of the domain that

is needed from the point of view of both the business and technological process in order to direct the socialization of work into the organization’s key scenarios.

What will our organizations be like in 5-10 years if processes become social? In 5-10 years we will have realised that the elements of ad hoc work for each business activity have always taken up a large chunk of our time.

Starting from here we will achieve the right mix of processes and “social”. For many business activities, if we look at how each hour of work is spent, most will be outside of the system for managing transactions and more and more will be in the systems of engagement. The mix between the process and social elements in business systems will provide support to this reality. We will always need our transaction management systems because these are what provide the final record, certifying what has been done and by whom, but in the next 5-10 years our technology and our work will truly reflect collaboration with the appropriate processes, data, contents, people and a context that up to now have been missing from the conversation on Social Business.

[1] See Process is an embedded reaction to a prior stupidity. [2] Data from Forrester and Gartner taken from BPM Adoption and Delivered Value/ROI. [3] Data from Gartner taken from BPM and ROI. [4] From Business Process Management: Are we making the most of content-driven processes, AIIM. [5] See John Seely Brown and John Hagel in The Power of Pull. [6] From Business Process Management: Are we making the most of content-driven processes, AIIM. [7] See John Seely Brown and John Hagel in The Power of Pull. [8] For further details on the relationship between collaboration and efficiency please seeMigliorare la collaborazione tra tecnologia e cultura.

[9] From posts by Sigurd Rinde ASAP Influencer Summit #3 – SAP missing the biggest opportunity ever? [10] For a more complete description see Da Taylor a Drucker. Ottimizzare per la conoscenza. [11] See How social technologies are extending the organization, p. 5. [12] See I semi della collaborazione nei processi and Lessons Learned From 100 Early Social Business Adopters. [13] From Knowledge worker empowerment is vital to success by Forrester and Isis Papyrus. [14] Also see The Big Failure of Enterprise 2.0 Social Business by Laurie Buczek. [15] For a description of how to apply and make use of feedback from clients in the evolution of business processes please see Dai clienti ai processi. Unire Social CRM e Adaptive Case Management. [16] See [17] Both with regard to events generated by other individuals, and outputs produced automatically by the available applications.

[18] For further details see Socializzare la catena estesa del valore. [19] See

5. Social Business: Cooperation vs Competition Even Sumantra Ghoshal mentioned it in his in-depth criticism of the management teaching model used by Business Schools: the world of management has been built on principles and ideologies that do not take into account the real nature of man and social organization. The predominance of a vision of the company based on the assumptions of the classical economy – competition and tendency towards individual usefulness – have made us forget how the essence of the company is firstly its organization, or rather the search for an articulated and complex form of cooperation. The (theoretical) success of the agency theory has reduced each social action to the relationship between an individual and a system of extrinsic incentives, with each problem seemingly solvable only with the adequate mix of incentives that reward only the best and most worthy. Public services are also not immune to this, with schools, universities and the health system reduced to experiments of an unproved and unprovable abstract model of people and companies. And management is becoming more and more “talent management”, meaning management by only a restricted group of people characterized by unique and unrepeatable elements that they would like to connect to performance. The organization is also disappearing and being reduced to the creation of a context in which various talents are placed in competition with each other. In this social Darwinist scenario, the explosive revolution of social media makes the little-known thought of Chester Barnard (1938), little-studied and barely-loved for its unnatural mixture of practical and human experience and of the complexities of theoretical and scientific references, has become topical again. For Barnard an organization is firstly the result of the evolution of humanity, based on the complete development of our capability to collaborate. The complexity of collaborating is not underestimated, so much so that Barnard points out its temporary nature and proposes that in fact management’s main role is to guarantee it. But his contribution has been suppressed by a transposition of the purpose of organisations which, by the complex achievement of individual collaborative capability, have been reduced to gyms for exercising competition. As in

the parody of Monsters Inc. by Pixar, competition (like children’s fear) has produced its results, as its standard-bearers support, but they are not even vaguely comparable to the potential of cooperation (the children’s happiness). The revolution of social media and the speed with which it has spread is often connected with the trajectory of the technologies, emphasizing, for example, the role of the transition from web 1.0 to web 2.0 and in general pointing out the size of the applications. In reality, the technology, as shown by Stephen Barley (1986), for example, is only the cause for social reorganization processes deriving from deeper needs. The success of social media therefore represents the beginning of the revenge of cooperation on competition and outlines a different path than that of the acquisition and adaptation of technologies by businesses to ride this change. In order to better understand this success we firstly need to clarify what we mean by social media by using the most recent definition by Gartner, who make the following divisions: 1. Social networking: products of management of online social networks such as MySpace, Facebook, LinkedIn and Friendster and social network analysis (SNA) technologies that use algorithms to understand and map relations among people in social contexts. 2. Social collaboration: technologies such as wikis, blogs, instant messaging, collaborative office and crowdsourcing that allow people to exchange knowledge and work together without having to be in the same place as each other. 3. Social publishing: technologies that facilitate the collection of materials and contents to be made available in a single manifold easily accessible by all members of the community of reference such as YouTube and flickr. 4. Social feedback: tools to obtain feedback and opinions from a community on elements of specific knowledge as happens on YouTube, flickr, Digg, and Amazon. This definition greatly broadens the information horizon compared to the simple Facebook, Twitter and LinkedIn triad to which many managers refer in meetings. It also adds applications and tools that not by chance have led Gartner to predict that, by 2016, social media technologies will be integrated into the majority of business applications, requiring for example an integrated CRM

management, internal communication and collaboration, and public initiatives of social relations with clients. Even research into information systems for the HR of CedarCrestone in the 2010-2011 edition highlights how as much as 15% of businesses have adopted social media tools and 14% intend to adopt them in the next three years. Faced with ever more complex and inter-connected problems, decisional architecture represented by modern business and governance models, heavily anchored in a hierarchical and command-control principle, is unable to withstand any longer. Since the Nineties, the symptoms of the crisis have been handled with marginal adjustments, for example on the human resources management policies front, by stimulating internal entrepreneurship, accentuating the differences on variable remuneration, or on an organizational model level, proposing learning organization or network concepts (Manzolini, Soda & Solari, 1994; Solari & Zanon, 2001). As often happens in transition stages, with some clear exceptions, those that would be called for a role to govern this transition are also those that had more to lose to begin with in terms of power and control. As a result there is a stubborn and organized resistance that is trying to transform social media into controllable and predictable tools. In reality, in the current scenario, organizing and managing means knowing how to reach the largest number of resources and building collaboration systems with these resources, partly regardless of the traditional distinctions between internal and external, but above all regardless of role distinctions. It is not the levels that build value for the end client, but the actual contributions. It is not a simple transition to carry out, and firstly summons the CEOs, supported by the CIOs and the Human Resources Department. A real Social Business Re-engineering process is required, a concept that takes the idea from Business Process Re-engineering of setting aside the pre-existing structure in order to concentrate on the sole activities that create value for the end client, and adds the knowledge that numerous interaction and decision processes must be added to the transformation processes, following a change model subdivided into the following stages: 1. Interactional environment analysis. Every organization has its own interactional environment, or rather different methods with which collaboration is promoted. First of all, it is therefore necessary to analyse the existing channels of communication and the methods

with which decisions are made, also identifying the specificity of different company areas. In this stage the physical layout and the geographical distribution of people also represent important analysis subjects. 2. Sharing culture. The sharing of information and decisions is rooted in the culture of the organization and it is therefore important to understand what information flow segmentation elements are rooted in the organization and connect them to an analysis of the underlying organizational culture. From the link between the interactional environment analysis and the sharing culture analysis, we start by identifying the objectives of the transformation that may be incremental and therefore adapt to the existing or radical structure and promote with the introduction of social media a change in both the organization models and the existing culture. This process is therefore an organizational design process that embraces three stages that are independent from and parallel to each other. 3. Infrastructure. The new organizational design requires initiating the macrostructure and the main processes in order to redesign them within a social logic, thus drawing an advantage from the widespread methods of involvement. At the same time, governance roles of the new structure must be identified and the organizational positions involved must be amended. 4. New leadership models. The organization’s new architecture requires behaviour models and different management models, challenging the management to have to abandon the idea of being able to solve every problem on its own. A management open to criticism and capable of listening, as well as obviously familiar with the chosen technologies, is what is needed. 5. Tools and technologies. The choices of technologies and tools are a function of the prefigured architecture and must be accompanied by a change process aimed at aligning the organization. 6. New metrics. In an organization designed in this way, it is also necessary to provide for new metrics and new tools for assessing results and how things are working internally.

In conclusion, this is a central challenge for organizations in the near future, a challenge that the Human Resources Department will have to face first of all, side by side with information systems. If said department is able to manage the challenge, a renewed centrality will be created as a result, otherwise it runs the risk of being marginalized and of having to follow decisions that will be made by others. Leadership from a network perspective Managers as connectors. According to Organizational Network Analysis, a leader can be analyzed by looking at the position and the function that it has compared to the network; new perspectives arise from it to reread the key functions of a leader: openness to the new, integration of different perspectives and knowledge, ability to receive and circulate information, overcoming barriers and silos, etc. The following table shows five types of leader in relation to their own function as a connector (revised by Gould and Fernandez, 1989):

Organizational Cultures Organizational cultures condition the processes of sharing information and decisions that Social Business needs. We use the following model to make diagnoses and representations of the predominant cultural model, collecting indications on different sizes. •

Dominant characteristics: procedures/rules vs initiative/pro-activity

Leadership: support/cultivation vs coordination/efficiency

Organizational glue: trust vs policies

Strategic focus: development of people vs efficiency/control

Management: participation/team works vs compliance/stability

Meritocracy: engagement vs efficiency

……………………. Bibliography

Barley, S. (1986), “Technology as an occasion for structuring: evidence from observations of CT scanners and the social order of radiology departments”, in Administrative Science Quarterly. Barnard, C. (1938), The Functions of the Executive, Harvard University Press. Ghoshal, S. (2005), “Bad management theories are destroying good management practices”, in Academy of Management Learning & Education, 4(1), 75-91. Manzolini, L., Soda, G., & Solari, L. (1994), L’organizzazione snella (The Lean Organization), Etas-Fondazione IBM Italia. Solari, L & Zanon, A. (2001). La quasi fine della gerarchia. Organizzazioni come vantaggio competitivo nella new economy (The near end of hierarchy. Organizations as a competitive advantage in the new economy), Franco Angeli.



6.Social Learning: the organization learns how to learn A theoretical framework We begin with a fundamental premise: Social Learning is not a new trend. Learning models such as those of corporations, guilds and apprenticeships invoked long ago what we now call Social Learning. Going back further in time, the first philosophers practised Social Learning almost exclusively, as the stories which are still told about Socrates, Plato and Aristotle remind us. What is really innovative, today, is the scale on which we can be involved in a process of social learning. Web-based technologies greatly reduce the barriers that learners were forced to face in the past (time and geography are just two of many possible variables that can be used as an example): the development of social networks and tools such as Skype, Google Talk and mobile devices, the level and scale at which we can be “social” has increased consistently and substantially. In this sense, Social Learning is a return to our more natural way to learn and interact with others.

As regards the relationship between Connectivism1 and Social Learning activities we can see Social Learning as part of Connectivism. Both concepts refer to how knowledge is distributed and emphasize how complex problems can be solved by assuming a network and systemic perspective. The point at which Connectivism differs from Social Learning is the access to resources and sources including non-social ones. For example, new ideas, very often, are simply reworkings of ideas that followed one another in past centuries. William Rosen in his book The Most Powerful Idea in the World, highlights exactly this point, i.e., the way in which people connect to each other’s ideas is not always Social. Furthermore, the way in which organizations create their managerial structure influences the way in which information flows within the organization itself. Connectivism is linked to (the question of) how this information, these techniques and social structures have an

effect on and contribute to innovation, invention and dynamic adaptation of the individual and the company. The biggest developments in the near future – in terms of emerging learning systems – will above all be in the domain of analysing knowledge: in fact, we produce huge flows of data in almost everything we do (a process amplified greatly by mobile technology). Our ideas, our positions, what we read, with whom we interact. Everything is captured forever on Facebook, Foursquare, Twitter and our blogs. Many companies are fumbling in the dark in terms of knowledge and organizational learning. Recognizing and using wisely the huge amount of data and flows of information that are produced is the first step to moving towards an analytical approach as regards the goals and objectives of a company, as well as being a good way to build competence. Through the analysis of information flows companies can understand how knowledge moves in networks, how people work together, which people should be working together based on the activities they have previously performed and how to deal effectively with complex problems (such as entry into a new market, acquiring a new company, or launching a new product). Analyses of these data – in essence – can help companies better understand themselves. Most experts and consultants emphasize the social dimension and the way new technologies – Facebook, Twitter and blogs – contribute to making people “social”. They deal with the social aspect as the most critical element within the internal process of learning. We instead believe that people are motivated primarily by information. We constantly process information. From childhood, we try to make sense of the world by attempting to think about it, to evaluate it, to connect the pieces of information we encounter. It is an evolutionary trait: we are living beings based on information. We develop in relation to the information around us. Looking back at the time when man was a hunter-gatherer, those that survived were those who were able to make sense of the information in the context in which they lived: which plants to collect, which animals to avoid, what to eat and so on. Our starting assumption is that the dominant trait of humanity is the acquisition, processing and creation of information. We employ social approaches that allow us to manage information better.

Too many people discussing Social Learning see the social dimension as its final goal. We see it rather in the search for meaning and a way whose primary purpose is to use social approaches to assist us in personal evolution and survival. In the early ‘90s Lave and Wenger had already intuited the pivotal role of communities of practice and informal exchanges between people in organizations. After more than twenty years from their early work, the organizational landscape has evolved considerably, but the importance of the role of informal communities in building knowledge has not only remained unchanged but also benefited and been strengthened by the great evolutions – both technical and cultural – of all that vast sea that may be labelled as Enterprise 2.0, where the role of the community has become dominant and paramount. In this sense, Social Learning fits into the organizational dimension connected to learning, the exchange of knowledge, training and the management of human resources that has become fundamental important in all businesses, both more or less complex. The diagram shown in Figure 1 summarizes well the evolution from the ‘90s to the present of the conceptions of training in terms of the technologies they employed, from simple systems and approaches to basic distance learning up to blended learning and building environments that allow a degree of interaction and an ever-increasing number of functions.

In trying to give a concrete definition of Social Learning, however, we could argue that it is an emergent phenomenon (not predetermined or planned) that originates from knowledge networks and information flows, both formal and informal, within organizations. Social Learning is, moreover, the reliance on social networks and interactions for help in our own search to give meaning to the information around us. Today “knowing” means to be connected: knowledge is moving too quickly because learning can be considered simply a product that comes at the end of a process. We need to connect to networks of information and “deposit” knowledge in relationships rather than in our heads or in knowledge management systems. We are not dealing, therefore, with the simple application of social technologies (or 2.0, according to by-now dated label) to the context of learning, trying to evolve the classic logic of LMSs (Learning Management Systems) towards models similar to those of well-known social networks. Rather, we need to rethink training and learning development in a way that integrates more with the flow of operating activities. We need to think of the learning organization as a living organism that is constantly evolving. Let us understand better the context of referral and the principles of Social Learning through the analysis of a case study.

Applying Social Learning: a case study We will try to explain the basic concepts of Social Learning with a practical example related to a situation in which many organizations may find themselves: a large multinational company needs to review their Learning Management System, which is becoming obsolete. The portal that delivers training content was based on a platform whose functionality is rapidly declining. In addition, the company also needs to move towards a system with lower maintenance and management costs and that can be maintained independently, without relying on external vendors for every need, even a small one. The project, then, started with the aim of porting all the historical data and SCORM/WBT packets so as to be able to continue to offer the training program to all the company’s. (We are talking about a population / user base of more than 5,000 people).

This is a classic use of this platform, based on precise and concrete learning objects in which the e-learning part is used in a very traditional way, as a simple static content provider and file repository. In essence, the mode of learning underlying the platform is based on a very simple concept: users of the platform access training courses they are assigned to and training is performed in a passive manner, limited to observing the explanation shown on the monitor and completing a comprehension test at the end of the trail. The challenge in this project was therefore to provide customers not only a mere porting content from one platform to another, but integrate the four dimensions of learning, which we consider indispensable in the design of a Social Learning environment: Training & LCMS (Learning Content Management System): a company – small, medium or large – needs to provide courses for which tracking is required (we are only looking at those required by law: 626, Privacy, etc.) and a tool that will be a classic LMS must be present in a Social Learning environment. Creating a Social Learning project doesn’t mean throwing away years of experience and knowledge about the e-learning world, but rather means to valorize these experiences in a changed context. Another topic to cover is assessment and reporting which very often need to be produced and cannot be left uncovered. Introducing a platform which covers these needs within the context is certainly important and useful in order to deliver more traditional training. The



System: This







delivery/presentation in an as user-friendly way as possible, with appealing graphics and meeting the classic user-experience principles: it is not uncommon to find company training management platforms and learning courses provided with interfaces which are not in line with these considerations: user-unfriendly and complicated environments with a very bad user experience are unfortunately quite common. It’s better not to underestimate the way contents are delivered, because learning can only be effective in an environment provided with good cognitive affordance. Moreover – considering the basic project idea – a CSM is aimed at allowing an easy upload and sharing of contents and – secondary but equally important – at supporting an extremely wide range

of formats. Here’s what makes things much easier for people dealing with training: creating modular and specific learning paths. Self Learning: companies’ repositories abound with contents that can enrich and integrate training paths. When planning new learning platforms it is necessary to expect the integration of more sources – both internal and external – in a self-service way. Moreover, being fully consistent with the lessons of the previously mentioned 2.0: relying on folksonomies, on modular and customizable paths and focusing on the single user’s needs today more than ever form the winning keys in a learning process/path. Community & Social Network: communities – the “social” aspect – are the real cultural, social and technological revolution that has involved us over these years. Being able to valorize practice communities and related networks is a distinguishing crucial point when it comes to creating a learning environment which can generate value for the whole business ecosystem. New formats: wiki, social bookmarking, storytelling, gaming and micro-video are just some of the tools that users should use in order to generate contents to feed the platform in a bottom-up way. The goal should be to feed a repository to create a Youtube, a company Slideshare or something else, and provide learners with all the necessary tools to share learning-related contents quickly and easily.

To make a comparison, the environment should be able to allow the maximum level of presence3 inside, at least. Only in this way will the users really be free to experiment with new formats and get a true benefit from them in terms of significant learning. For example, for the project we talked about initially, the four dimensions (fig. 2) have been integrated by using OpenSource technologies which covered different themes and needs. With regard to LCMS management they chose to use Moodle which has become a point of reference, especially over recent years, in the LCMS field. It just takes a look at the statistics on the official website to realize that. Nevertheless Moodle is still bound – by choice and by necessity – to a classic view of learning and is missing most of the functions found in more social











( So how can we meet these limits and customize the Moodle interface more effectively? An integration process with CSM and Social components has started. Now all that is needed is to define an environmental integration process, most of which we have discovered to be already provided for and implementable through a plug-in. Yet we still haven’t dealt with the management of informal aspects, which we have covered also in this case by a special plug-in to create internal communities in Joomla: this plug-in is JomSocial

( By integrating this plug-in all the development areas have been covered. The case above is meant to be a starting point to understand how to build up an as rich and stimulating learning environment as possible with a few simple tools, which could take into consideration all the needs of the actors involved. The technical difficulty of creating an environment like this is modest. Besides the planning, the real challenge lies in the maintenance and involvement of learners. In any case the idea remains that a Social Learning project – and, generally speaking, every Social Business project – is to be planned as a tailor-made project based on the different and specific needs for each context and case.

By forcing ourselves to try to extend what we learned from the example above to a general context, we underline how social technologies can guarantee the possibility to create wide and articulate training and learning paths. The application of social technologies to training in classes can later evolve the mature considerations made about blended learning so far by taking it to a new level which can valorize different contents. In this sense in fig. 3 we have included the diagram shown in Scotti and Sica (Community Management, 2007-2010). It clearly shows how the planned and catalogue training is only able to cover a part of the mare magnum where learning takes place.

In this sense the creation of communities that support knowledge is a fundamental requirement in order to facilitate those silent aspects that couldn’t be valorized otherwise.

Assessing Social Learning Even when assessing learning it is necessary to review and rethink methodologies and technologies: it is clear that old logics cannot be used and applied to new paradigms, but the whole framework of learning processes, of the individual and – more in general – of the company, must be reviewed. A large amount of research is heading in the direction of using Social Network Analysis (SNA) to assess training and learning. In the early 2000s, we used a Social Network Analysis project involving a department of a large University in the US to assess over 100 people. We tried to understand how these people collaborated with one another, where they would go to ask for help and how they used social networks to solve their everyday problems. Understanding the essential nodes of the department network was an important starting point on the path to an organizational change. In a very similar way, today’s companies need to take in consideration new analytics and innovative assessment models to reconfigure their structure. The

knowledge lying in most companies is not properly connected. Very often certain people work on some problems without knowing what others are doing, without any awareness. When analyzing the results of learning on both an individual and organizational level, we need to rethink the way in which we identify and analyze the results of the training interventions. Analysis tools play an important role in the mapping of organizational knowledge. In this sense, the analyses provide us with a model to start from to reconfigure our company. In the past, leaders have sometimes taken decisions blindly. For example, the joining of two departments was carried out because it made sense financially. Very little attention has therefore ever been paid to knowledge and to how learning and the building of knowledge could be influenced. With this type of analysis we can better understand these “blind spots” and eliminate the risks in reconfiguring the departments in our company. In this sense the Kirkpatrick model (based on an individual assessment of the impacts of training) – well-known to those in charge of assessing learning – can be revisited and evolved into a wider assessment approach extending the analysis levels to a larger and “network” dimension, also able to assess the most widespread organizational impacts that involve the communities found within the company (see fig. 4). Specifically we ask ourselves: in what way are collaborative networks emerging? At the end of the training course, which networks have been improved and what new cores have been born? How is knowledge moving inside the company? Have internal affinities towards the course themes changed? How should work teams be organized to improve company efficacy and efficiency?

We can therefore identify four other dimensions to support those initially provided for by the model, in order to better assess the impacts that the training course has on the working network:

Affinities: at the end of the course has the level of affinity of the participants changed towards to the themes dealt with and the more general goals?

Social Knowledge: through the training course was knowledge spread inside the company by taking advantage of informal networks?

Network Creation: have collaborative groups and new links within the course been created that can then be extended to the rest of the company?

Network Development: have we developed the creative cores already present?

The integration of these “new” assessment methodologies and processes within the classic models that are already well-known to those in charge of training allows us to have a complete assessment framework of the company and fully understand the formal and informal exchanges within the company.

Notes 1. For references to the Connectivist approach please consult the George Siemens volume: Knowing Knowledge 2. SCORM (Sharable Content Object Reference Model) means a reference model which allows the independent exchange of contents on the platform. A WBT (Web Based Training) is a training package supplied on the web. 3. At the level of psychology of new media (Riva, 2008) we define the concept of presence as the feeling of being inside a digital environment given by the possibility of putting into practice our own intentions.

7. Intranet 2.0: evolving communication and working environments

Intranet, Social Intranet, Digital Workspace. The term Intranet – the exact opposite of Internet and Extranet – was coined in the first half of the 1990s to indicate Web communication environments restricted to the employees of an organization. Over time and with the evolution of the role of Internal Communication in organizational logic, the Intranet has gone from being one of the tools of communication to the convergence and integration platform able to carry out more and more relevant strategic functions. The essential terms of this evolutionary journey are outlined below: •

Communication tool: the Intranet is the website for employees, useful for providing the company with a single and fast tool for circulating information, for building identities, and for reinforcing values and perspectives.

Self-service applications: in the Intranet, work tools or individual applications linked to business processes appear.

Groupware: at the turn of the new millennium project management environments (calendars, project management, forums, etc.) and structured document management repositories made their appearance.

Social Intranet: in the last 5 years the introduction of collaboration facilities such as tagging, wikis, blogs and forums has transformed the nature of intranets. The relational component has gradually become more and more strategic, and the logic of social networks (activity streams, microblogging, user profiles, etc.) has moved the focus further towards a greater socialization of contents and processes.

Digital Workspace: a further evolutionary step that we are witnessing and that we will continue to witness more and more is the integration of intranets with a company’s external portals, to talk and interact with partners and clients. In fact, digital workplaces are being

planned in which private and open environments coexist that, also thanks to social applications, extend the company’s capability of communication and value creation.

Recent trends and components Digital Workplace Trends 2012 is the annual research on Intranets conducted by Jane McConnell on more than 450 European and North American organizations. As regards theobjectives of organizations to be pursued through their own company network the following are singled out: •

Improvement of communication towards their own employees;

Spread and growth of collaborative environments;

Activation of customer service tools;

Less pursued, on the other hand, are the support in decision making and the management of online processes.

If we look at mobile services in particular, we discover how companies with complex sales networks are investing to improve collaboration among resources in the field and make access to experts easier. Another phenomenon to underline is the growing tendency to manage digital policies through a single group of specialists (consultants and professionals) and managers who deal with the management and evolution of internal and external environments. The same managerial group (digital board) is responsible for designing intranets but also for designing client and partner

portals; the user experience, the technological and web communication competencies tend to merge between internal and external. The communication subjects and objectives change but the interaction dynamics do not; and above all the company users, being in turn consumers and users of other external portals, recognize the same navigation and participation logic within their own intranet. The expectations of future intranets are another interesting aspect of McConnell’s research: •

Intranets built more and more around people in all stages of the process: in design (codesigning contents and services that are more appropriate to the specific context), in user experience (introducing the ability to personalise navigation and services), in management (with a distributed governance);

Boosted information research services, intelligent content categorisation services, based also on user input;

Advanced services for work teams that can more easily carry out activities, have access to experts and be more and more connected (social networking, social tagging, location awareness, etc.);

A greater relevance of the user experience in designing navigation.

The reference model The needs that an intranet must satisfy can be divided into four fundamental areas: Communication, Contents, Collaboration, Activities (figure 2). All operations can be traced back to these areas knowing that we are comparing ourselves with different organizational contexts in which these areas are contemplated and managed in different ways. If we think, for example, of an intranet with ten years of history, we are faced with an environment in which communication and contents are predominant and in which we would be unlikely to see the same care dedicated to the management of business and collaboration activities. Even today we sometimes happen to analyse contexts in which, even when contemplating all four areas, intranets are organised starting from the contents and a company-user information flow. These are not

technologically obsolete contexts, but the stratification of contexts over time can generate “information monsters” in which it is tough to find the contents and responses useful for daily work.

If collaboration environments in which users can work and share experiences, knowledge and solutions are added to the “classic” communication and repository functions of contents, the intranet takes on a new role; it becomes to all extents and purposes a business tool. The stronger the link between the digital environment and daily work matters, the more this tool will be seen as useful, and therefore used. An intranet can have different characteristics and objectives based on the organizational context and the market in which it operates. We can see that intranets are used in various sectors and with a varied number of users to be managed: there are those who focus on contents, those who focus on collaboration, and those who are only responsible for communication, or only for services.

We have noticed three types of intranet (figure 3), which we have classified with a label assigned based on their tendency to be responsible for the fundamental areas in different ways: •

Corporate Portal: the Intranet is the company’s image and its information reference. There is a strong emphasis on the values of communication (Identity, Values, History, Offer, Organizational Setup) and document repository.

Social Enterprise: the Intranet is the place in which business applications integrate with emerging collaborative activities.

Self-service: this is where the individual user is the centre of communication and services. We are faced with a service portal that supports and informs employees.

The case of building an Intranet The context. Now let’s look at the process of building or rebuilding an intranet. Following below are the stages, resources and competencies needed to deal with a project in a manner that is complete and shared with users. The case that we are referring to is a project created at an organization of approximately 3,500 users, made up of 25 different company groups. The planning and creating process involved more than 60 users from the different company functions that contributed to creating the company portal. 55 meetings to compile the requirements and co-design the graphic and IT solutions, 6 months from defining the strategy to releasing the platform.

The OpenKnowledge model envisages 4 main stages (figure 4) to conduct an intranet building or re-design project. In each of the stages activities and deliverables are created. Stage 1: Strategy and Analysis Involvement of managers through




and a

Activities summary document for the programming of the intranet and governance guidelines Mission and focus of the intranet,



Deliverables KPIs,




responsibilities Knowledge



Necessary competencies processes, vision

The first step is defining the company objectives: in our experience they are never the same, as each organization has its own short, medium and long-term needs; the imperative is to look beyond the normal functions of an intranet and expect it to become a tool for the organization’s business and one that can improve the results of work teams. With management we describe an intranet consistent with the company vision and, at the same time, we define the sets of users for whom we have to plan services, design environments, and provide collaboration tools. This is therefore also the time to define some quantitative and qualitative performance indicators with which to measure the success of our intranet and follow its evolution over time. To broaden the horizon, here are some examples of strategic objectives indicated by various managers in projects we have managed: cultural integration and

effectiveness, knowledge management, engagement and atmosphere, efficiency and simplification of processes, reduction of information research times, visibility on projects and activities, integrated management of applications, making the most of professional families and know-how. Stage 2: Co-Design and Implementation Mapping flows





and involvement of users through Activities









the contents

and navigation paths, IT development Governance model (roles and


inventory, content trees and categories,





plan for facilities, look&feel, implemented


configured platform Knowledge organization Competencies

company design,






the web


development, web content


We have collected instructions from management in order to build an intranet with specific objectives and one that satisfies its users. The design of the intranet now requires the following fundamental elements: •

Inventory of existing components (content inventory) and development of new contents (texts, images, video);

Information architecture that is consistent and recognisable by everyone;

Environment and content governance that defines the processes of publication and collaboration;

A user experience able to facilitate navigation.

Instead of asking ourselves what our users need in theory, it is much simpler and more productive to involve them in the process right from this design stage. This is the practice of co-design: facilitated by fast and collaborative methodologies, it is with the users that we define the contents and priorities, categories and current language within the organization, and the most appropriate tools and facilities for achieving business objectives. This stage, which can seem complex – as it requires the involvement and commitment of other respondents – is actually fundamental not only for the accuracy with which information is collected by minimizing the risk of building environments that are not recognised (or populated) by users, but above all because an environment co-created with users is a more productive environment. So who to involve? If the goal is to satisfy groups of users, communities, and company functions, it will be important to choose a representative from each of these together to build a group of champions, a team that reports the needs, contents and points of view of its own group of reference (in some cases these wide-ranging groups of organizations continue to share best practices for improvement and represent true ambassadors when promoting the use of new tools). In this design stage the tool that could be useful is Organizational Network Analysis, an organizational “photograph” that shows, beyond the manager’s reports, what the real connections

between people are and which resources hold positions of reference within the company ecosystem on specific subjects and processes. The choice of the technological platform goes through an in-depth analysis of the specific requirements defined in this stage; on the list of requirements the software selection process is applied: coverage of the facilities, weight of each facility or area, assessments of the Total Cost of Ownership. Also very relevant in the choice – in addition to the coverage of facilities from both the user and administrator perspective – are the solution’s general characteristics that have an impact on flexibility, on the ability to rebuild the defined governance processes, on the integrability with other environments and tools, on scalability, on multilingual management, etc. A comparison grid of the technologies under examination is a useful tool for achieving in a reasonable timeframe a choice of platform on which to implement and evolve the intranet. This grid, in addition to reporting the coverage of the facilities, determines a score for the quality of the macro-functions based on certain criteria that are important for the company, which are added to the criteria of economic convenience.

Once the technology has been chosen, we begin the activities of implementation, estimation of the hardware components and the resources necessary for the ad hoc development and the initial configuration. The specific competencies and the technical documentation regarding the platform chosen become fundamental for a better optimization of the costs during future stages of development. These more technical elements are shared among the persons in charge of development (internal and external)

with the aim of immediately building a group of IT people that are competent in the logic but also in the methods of designing and implementing IT. Everything is implemented by managing the navigation mechanisms and the graphic customization, constantly collecting feedback from users starting from the first test stages. Stage 3: Soft Launch Involvement of one or more pilot groups for the creation Activities of



Community management Calendar of releases and launches of the intranet for the







Deliverables group




improvements to be carried out




stage, Assistance to users Knowledge of the IT tool, Competencies



Community management

Before concentrating on Go-Live – the moment of release and communication to the whole organization of the launch of the new environment – we need to test the environment: the best way to do this is to determine a pilot group that has the double task of verifying and improving the functions, but also of interacting with the contents. In this pilot stage it is fundamental to monitor users’ behaviour in a sufficiently long period to verify how much and how a single group (project team, a company function, a community or another set of users) produces and makes the most of

the contents, chooses the navigation paths, and re-designs work processes with the help of collaborative tools. By documenting this first pilot experience, a business case is built that is useful in the stage of promoting and sharing the intranet’s potentials. The success factor of this preparatory stage is the ability to stimulate users who find themselves in a new virtual environment, guide them and introduce them to new ways of working by involving them personally in improving the intranet. A good community management manual can be of use in this operation of stimulating and engaging the users. Sharing the best practices, difficulties and operational methods of this engagement will be useful for all company groups at the time of the launch and during the first launch period. Stage 4: Launch and cultivation Definition of communication messages and contents for promoting





Activities schedule



organization, monitoring the KPIs, collecting feedback, community management Communication


promotion contents, news programme schedule and launch


Deliverables collaboration



environments for editorial organization, user assistance


Web Competencies



communication, community management

If we have worked by involving the users, the news of the new environment will not come as a surprise; it is important that everyone, starting with the managers, feels the intranet is one of their work tools, and that implies the choice of some key messages to be passed on to the users to introduce them to the new way of acquiring information and working more productively. In this promotion stage the behaviour and interest towards the contents were monitored: not only did the access to information increase, but the collaboration environments were also more and more requested by the various company functions; this is just the beginning of the journey, but there are returns on operational efficiency as shown by, among the various efficiency phenomena, a reduction revealed in the coordination costs among work teams, along with a considerable decrease in the number of emails for communication and project management. Furthermore, the personal profile, and the constant updating of information regarding the intranet users, has reduced the time taken to trace the contacts relating to different territories and organizational units. The greater result, besides the individual indicators, is the high level of involvement of everyone as shown in figure 5: each person has an active role and place in the company’s intranet ecosystem. Strategic use of “social� components. In the case that we have mentioned here there are no latest generation technological elements and even the social facilities used within the company have been introduced gradually, always following requests from work teams. The novelty factor was definitely involving the users in the co-creation of the environments and following their priorities and insights to organize and design the navigation environment.

Even without fully exploiting the collaborative potentials of the social IT platforms, this project has been set up with participation methods in the attempt to fully socialize the process of building the digital environment and its contents. KPIs of a Social Intranet. From objectives to results, we aim to make tangible the advantage that these intranet reconfiguration experiences are generating for companies that have been and are ready for this investment. For each of the objectives we can define some indicators and proceed with building a true ROI model for Social Intranets.

Below are 6 indicators for each intranet director. For company knowledge management it is important to measure: 1. Time taken for information research. 2. Quality of information (clarity and level of detail). 3. Number of accesses and frequency on the contents pages and detailed files. 4. Number of contributions from users (new contents, comments and revisions). 5. Level of update of documents. 6. Wide range of accesses by user groups.

For Community management it is important to measure: 1. Number of active users (increases/decreases). 2. Number of contributing users. 3. Number of contents generated in collaboration. 4. Number of interactions on community topics (forums, blogs, wikis, etc.). 5. Quality of contents and solutions emerging from the interaction of members of the community. For the re-engineering of processes it is important to measure: 1. Time taken and costs of organizations for meetings and sharing moments. 2. Time taken to make decisions. 3. Costs of activating resources involved in the process. 4. Overall time of activities, with and without collaboration tools. 5. Quality of decisions, products and services at the end of the process. 6. Savings/earnings of overall resources at the end of the work process. For idea generation and management it is important to measure: 1. Number of active users and contributors to company innovation. 2. Number of ideas and solutions generated. 3. Number of interactions compared to the ideas proposed (comments, votes, reports, etc.). 4. Time taken for the emergence of the best ideas and people capable of generating innovation within the company. 5. Time taken to create ideas assessed positively by management. 6. Savings/earnings of resources/time against the implementation of ideas that became projects. There are two other advantages in addition to these objectives and their precise indicators that it would be worth measuring at the end of a Social Intranet adoption programme:

1. Company identity generated by a process of participating in building the intranet, the closeness of people with the values and the management that is the creator/promoter of such identity. 2. The time to market meaning the ability to exchange information more quickly in order to be more and more reactive to requests from one’s own clients. A further consideration to be made, for those who wish to assess the ROI of a Social Intranet, is the interdependency of the investment in the intranet with the investment in external portals; companies are tending more and more to use not only the same technology, but also the same competencies of development and collaboration.



8.Social CRM: serving the customer

ROE? Return on experience. Hands up those of you who have not been forced at least once to spend hours on the phone in the desperate attempt to fully understand the characteristics of a newly purchased technological gadget, to enforce the warranty of a product that has stopped working, or to dispute a wrong charge on a telephone bill. Judging from a five-year study published by the research company Forrester, there are many companies in any sector with more than just a few problems in guaranteeing their customers a pleasant, consistent and efficient interaction through whatever channel they may have chosen. The customer experience of the 160 brands analyzed in fact received a negative judgment in 63% of cases, whilst only 3% of companies were evaluated as excellent, a group that has been in constant decline since 2007. More than a pure statistical curiosity, today we know that an excellent user experience is correlated with millionaire economic impacts thanks to the loyalty that it produces. The brands that pay most attention to customer satisfaction tend to generate a greater number of repeated transactions over time, fewer defections to competitors, and more recommendations by those who already use the product or service. Forrester also calculates [1] that these effects are translated into incremental sales of 788 million dollars for wireless connection suppliers, 825 million dollars in customers who stayed in hotels, and 65 million dollars in tickets sold through word of mouth by airlines. If having enthusiastic customers brings such big advantages, at the extreme opposite end of the scale it is estimated that in the United States alone 83 billion dollars [2] are wasted every year on lost customers or new customers never completed because of the insufficient experience that the companies offer. What is the main cause of customers’ dissatisfaction and disappointment? More than the product itself, in two thirds of the cases it is the service that influenced purchase decisions, consideration of the brand, the choice to opt for an alternative product, with 61% of consumers declaring to have

switched to a competitor following a negative interaction, and as much as 71% ending a relationship with a brand in the last year because of problems with telephone operators, purchases with automatic services, exhausting waits or poor integration among channels. A new relationship with a new customer Responding in an excellent way to the expectations that customers and potential customers place in the interaction with the company over the last few years has become more important and more difficult at the same time. The growing spread of mobile devices and social media as information, communication and connection tools is generating an extreme division of channels to be monitored, in addition to new behaviours that companies must understand and address in order to become a profitable part of the world of Social Business. If deep down consumers have always wished to exchange much more than money with companies when purchasing a good, what the social web has amplified out of all proportion is indeed the desire to be listened to and valued based on their own ideas, opinions and emotions. Through social media consumers want this contribution to be recognized, making themselves completely available to those entities that are interested in welcoming it, but also reacting aggressively when faced with a brick wall on the other side. These phenomena can be synthesized with the birth of a new customer, the social customer (see chapter 9, dedicated to Social Media Strategy). In turn the changed expectations of consumers, together with an endless and continually changing choice of channels, impose new challenges on the company. In order to be successful and compete in a hyper-connected environment, in which its own prerogatives to control messages fail, the organization urgently needs to rethink things from the point of view of an extended ecosystem, reorienting its strategy, processes, internal culture and technological infrastructure in order to bring the social customer from a role of mere consumer to that of ally, partner and amplifier. The first step is learning to see the company no longer as the centre of the universe, but as one of the actors in a community, a joint, transparent ecosystem, in which all parties benefit, as described by Paul Greenberg [3] in his definition of Social CRM [4]:

“Social CRM is a philosophy and a business strategy…designed to engage the customer in a collaborative conversation in order to provide mutually beneficial value in a trusted and transparent business environment”. In other words, it is the response from the company to the increased power acquired by the Social Customer. If CRM [5] is a mixture of processes and technologies for the efficient management of the relationship and transactions with the customer, Social CRM moves from relationship to involvement. For the first time, the customer is invited to sit at the same table as the company, collaborating on improving the overall experience and the same quality of services and products. Going beyond a linear and one-way approach from the company to the market, Social CRM brings into the company the signs and conversations expressed by the market, dealing with any organizational, cultural, technological and process obstacles necessary to make the business more agile, innovative and reactive to the requests from the end users. All of this is even more topical in the area of customer care and the more comprehensive customer experience, as the following stories show. Support comes from the bottom up Many companies declare they are centred on the customer, but how many of them truly are? To answer this we need to look at the organization from the outside, understanding the problems that the customer faces every day and realigning products and processes in order to provide a response that is mutually beneficial for the company and the market. Particularly symbolic of this is the BestBuy case, the largest retailer of consumer electronics in the United States, whose customer service is considered a serious thing not only by the 21 “full time connectors”, i.e. full time agents who respond on behalf of the company to problems raised on Facebook and Twitter, but above all by the 180,000 employees who have the possibility to help the customer first hand after being appropriately trained in the use of social media. Through Twelpforce, 3,000 of them each day support the operators on a mission to discover and timely resolve the public’s mishaps with an average response time of 12 minutes. The contribution of the

company’s employees is considerably increased by the forums managed first hand by the customers. With 84% of bottom-up generated responses and 26 unpaid experts who spend 8-12 hours there a day in exchange for recognition from the community, together with the official channels these online environments allow the company to drastically cut support costs by making available competencies that are not available in Best Buy, as occurs for example with the possibilities of integrating products sold by the company with articles offered by other suppliers [6]. Can one single user save the company millions of dollars? It would seem so, as Dell well knows: its technical forums “host” more than 7,000 customers and 4 million messages every week. Among the multitude of users there are some special individuals like Jeff Stenki, nickname Predator, who dedicate more than 123 days a year by providing punctual solutions to specific problems such as the functioning of optical disks, for the pure pleasure of helping others. Each of Jeff’s responses is publicly memorized in the forums and consulted thousands of times with a saving of 10$ for each call avoided to the call centre. With 50% of visitors who on average leave the site having found a solution, disintermediating technical conversations from the bottom up translates into an overall benefit for Dell equivalent to millions of dollars per year and different percentage points of greater customer satisfaction. Surprisingly, there are ultimately some companies for whom the community has become the founding notion for the supply of any service, managed by the included customer. The experience of giffgaff [7], English mobile operator able to function with only 14 employees and without any call centre, falls into this category. The customer communities are used in practice to determine phone tariffs, to notify inefficiencies and to exchanges tips or solutions, as in generating word of mouth. By taking advantage of an incentive mechanism on points to be converted into services or money, and 10 super users who spend up to 10 hours a day in the forums, giffgaff is able to attract 25% of new customers, respond to 50% of questions in an average time of only 3 minutes and obtain a Net Promoter Score of 75, close to that of companies like Google or Apple. If a traditional phone operator like O2 applied the same service model as giffgaff, involving even only a quarter of its customer base, the saving would be around 20 million pounds a year.

The number of companies that have decided to review their customer care strategy by also making use of digital channels certainly does not end here but, as shown by the above cases, applying the principles of social media to customer service allows tangible benefits to be obtained both by the organization and by its respondents in terms of [8]: •

Stronger capacity to intercept and put to good use feedback for the improvement of the product/service available in any channel, including online ones

Cutting of support costs and improvement of satisfaction level allowing customer communities to share bottom-up solutions freely

Increase in speed of responding to customer requests and in the level of trust in the brand through a transparent exposure of the employees to the outside world

Reinforcement of the relationship between the organization and the consumer from the point of view of word of mouth, loyalty and bottom-up promotion

Creation of retention opportunities, acquisition of new customers and cross-selling/upselling directly from the action of customer service operators.

Towards the future of Customer Care Paul Greenberg, father of Social CRM recently wrote: “2011 was the year that 20th century customer service began to disappear”. Apparently words meant for effect, this statement in actual fact summarises a long list of organizational, social and technological phenomena that are bringing into discussion the fundamental principles on which customer service has been based until now, imposing not only an evolution of it, but also and above all a reflection of its role within the company. This is a role which, as we will see, will involve at least informally more and more individuals and company departments. In the commonly accepted senses, customer service and marketing are two totally disconnected domains. Marketing is an activity aimed at generating business opportunities and tries to reach as many potential customers en masse as possible, at the lowest cost possible. Following the traditional funnel, the pipeline is fed by pushing customers in a linear way along the phases of awareness, interest, desire, action and possibly satisfaction, in order to capitalize on loyalty

through future purchases. In any case marketing serves to capture new customers, not existing ones. In contrast, customer service is a cost centre whose main goal is to solve as quickly as possible and at the lowest cost possible, but in a primarily individual way, the problems that a customer comes across when interacting with the brand. Unlike marketing, customer service does not work on new customers, but on existing ones.

Under the weight of communities, influencers and social media, however, the possibilities to control messages and informational asymmetries existing in the past between the company and the consumer are reduced. In this way, the linear abstract concept of the purchase path is moving further and further away from reality, instead leaving the past on a decisional loop [9]: •

Customers do not move in a linear way towards action. Today 53% of American consumers already declare they enquire online despite purchasing in a physical store. Thanks to the web and word of mouth an active evaluation has been born and, exactly at the time when the funnel should start to narrow, the potential customer widens its choice by discovering other alternatives.


Social media and word of mouth have an impact on the stages of approaching the brand in a non-uniform manner. If traditional marketing works very well in determining the mixture of

brands that customers initially have in mind, word of mouth becomes 50% more effective when individuals enquire about the quality of different options. •

Conversion is just the new starting point. Immersed in a global and disintermediated global social ecosystem, whatever happens after the purchase is for the first time more important than the strength and reach of traditional marketing. What is written online or said by people we know and respect can easily determine the behaviours that follow.

In the era of social media, in addition to acquiring new customers, the role of marketing is becoming that of keeping existing customers, surpassing their expectations, creating continuous occasions for contact and facilitating a role of fan and advocate. In other words,Marketing and Customer Service are moving closer together to reorient the mentalities and processes of the entire company around the customer: •

Service is the new marketing, given that it is the experiences and considerations of customers that influence purchase decisions. An impeccable service like that of Zappos [10] is the key both to capturing new customers and to guaranteeing an average amount of second purchases totalling $145 against $125 for the first purchase. For FICO [11], 13% of sales come from support forums and 39% of site traffic from contents generated by users.

Marketing and service must be aligned. In order to guarantee an excellent customer experience regardless of the channel, every moment of interaction must not only be errorfree, but it must also be consciously designed to maximise, from the point of view of marketing, a positive visibility.

The change that we are experiencing does not stop at marketing and service [12]. Excellent communication and great attention to the customer are quickly undermined by a defective product, not responding to market expectations, with an incorrect pricing or promoted by a Sales Force that does not know how to highlight the potentialities. Fully responding to the opportunities offered by Social Business means instead providing responses in real time, having a complete vision at all times of all customer interactions, leveraging on the company’s collective intelligence in order to

timely work out solutions, and proactively using customer feedback for the continuous improvement of products and services. Rethinking the service model Faced with the emergence of the social customer, customer service is reinventing itself to strategically integrate every channel (both social and traditional), to react more and more in real time, to increase the level of knowledge of the product/service, to leverage the enormous potential offered by the internet. To pragmatically address these challenges and to immediately start building the future of Customer Service, companies can put into action the ecosystem described by the following five components [13] (Fig. 1): 1. Customer Service & Traditional Support: this is the method of support already implemented in most companies with the goal of centralising contact activities, lowering costs for the company, speeding up exchanges, reducing the number of calls to operators, and moving requests to more efficient channels. The channels used include the phone, email, IVR, web self-service, online chat and video conference. 2. Collaboration among CSRs [14]: in order to improve customer satisfaction, the next step consists in creating collaborative support for the operators’ work, pooling customer requests and CSR responses within a knowledge base. The operators are updated in real time and provide faster, more accurate and more consistent replies to the public. 3. Social Care: in order to further meet the social customer’s expectations and extract intelligence from online conversations, many companies have started to follow their customers into the channels where such customers meet, connect and exchange comments with each other [15]. Similar initiatives to Twitter and Facebook Care humanise the organization and give back to the customer a feeling of an individual service, often making up for inefficiencies found on other channels. Social Care should be managed by the same operators as traditional Customer Care.

4. Peer-to-Peer Customer Communities: in addition to the channels that companies have control over, users spontaneously join together in self-help communities and forums aimed at sharing impartial opinions, technical solutions, passions or even finding comfort after unpleasant experiences with the brand. If appropriately facilitated by organizations, these bottom-up spaces represent the sole key to sustainably scale down service, create ambassadors, anticipate potential PR crises and intercept new ideas on the product put forward directly by the customers. 5. Enterprise-wide Social Support: the most advanced cases of the evolution of service towards Social Business, such as BestBuy’s Twelpforce, show the inevitability of supporting the work of operators by involving the entire organization that is directly exposed to the public, its criticisms, its needs, and its suggestions through social media. This last step is the most advanced sign of the centrality of the customer and the scalability of the service in terms of messages, channels, and schedules. The above described steps would neglect the most transformational and deep effect of Social Customer Service if they were not completed by an underlying attitude to extract sense in conversations among customers, operators and other employees. On the customer’s side, understanding the bottom-up exchanges allows it to identify, en masse and at a reduced cost, hidden and unexpressed needs, guiding the evolution of communication and product strategies. Within the company, creating intelligence on the collaboration between operators and other functions instead means bringing to light gaps, inefficiencies and areas for improvement for a customer-centric review of business processes. Bon voyage The future of Customer Service expects a journey of change in the mid-long term in order to reduce silos, put the internal knowledge bags in touch with each other and correlate them to the enormous mass of information that we are beginning to gather on customers through social media. The final result will in all likelihood be an overall realignment of innovation, research, communication, sales

and support able to maximise the ability to attract/keep new customers, but also the business value created together with them. Without a shadow of a doubt, the evolution of customer service represents a unique opportunity to build a more human organization mindful of understanding, learning and constantly improving on the needs of all individuals feeding the ecosystem: stakeholders, customers, employees and partners.

………………. More value foreveryone Interview with Esteban Kolsky How is social media changing the relationship between individuals, communities and organizations? The answer is simple: there are two ways. Firstly, social media allows all parties to interact more often and more efficiently by providing other channels to feed conversations. The second approach is taken advantage of only by more advanced organizations: it allows them to learn more about their customers, the communities they visit, their requirements and needs – and to show them how much the organization is doing to satisfy such expectations and desires. Once solid bases of intervention in social media have been set up, an infinite number of cases can be imagined that touch all processes the organization uses in doing business with the sole focus of creating value for both parties involved: company and customer. Why do so many organizations struggle to understand what their customers expect and how to provide quality cross-channel experiences? There are two parts to this question: firstly, companies struggle to understand their customers because they don’t know how to listen or what to listen to. Most companies have a strongly company-centric vision of the world and as a consequence they concentrate on what brings addition value to the company. With this modus operandi, customers are not easy to find, know or listen to. The company’s needs come first. Despite the channels selected – and none of these

better serves the process of increasing the value of the customer’s voice than social channels – the organization is unable to find the indications that the customer is expressing, as it does not really pay attention to the information it receives. This leads to non-quality experiences with the customer (and here is the link to the second part of the question), as these experiences tend not to respond to the customers’ expectations but rather to the understanding that the company has of what the customers want. Listening correctly through the available channels provides the organization with sufficient data to offer better experiences to its customers. Once these experiences are achieved with feedback and appropriate measuring mechanisms, moving onto more channels and crossing channels is much easier. Can you provide us with some examples of companies that take advantage of crowdsourcing and co-creation in order to improve their customer service? What benefits are obtained? giffgaff is probably the company most frequently quoted as using communities and crowdsourcing to provide assistance to customers and for a good reason: the entire company has been designed based on the premise of giving a service to the customer through a crowdsourcing model. giffgaff benefits from not having to worry about having a customer service function in its company: its customers carry out the customer service function. Money saved in this way is invested in better products, more technology to enable customers to collaborate amongst themselves and in cocreation projects aimed at improving the company’s products and services. Apple is another company that is taking advantage of the laws of volume and co-creation to provide an excellent customer service: their ad-hoc communities are a very popular choice for obtaining responses. When clients ask a question in one of these forums, they obtain a faster and more exhaustive response than they would from any other channel offered by Apple. Nike, Logitech, and many other companies are moving in the same direction. How will customer service evolve over the next 5-10 years? In my opinion there are three tendencies that are preparing to dominate the attention of anyone working in customer service in the next 5-10 years:


Cloud computing and the ability to reach the customer always and wherever with a highly proactive service at the time of need.


Collaborative Customer Service with the evolution of the current first generation of communities and forums.


A fluid and truly cross-channel execution of the interaction with the public with the slow disappearance of customer service as a function in itself in favour of its placement within the more comprehensive world of the user experience.

These tendencies will be mixed in different formats within the interfaces through which the end user makes use of the service, guaranteeing at the same time a proactive presence of the company at the time of need and the availability of experts when a more sophisticated service level is absolutely necessary. This could take more than 10 years, but the bases of this approach will be set up over the next ten years. Esteban Kolsky: Principal & Founder of ThinkJar

……….. [1] As described in The Business Impact of Customer Experience, Forrester 2012. [2] For more details see Povero Customer Service (Poor Customer Service), Social Enterprise 2010. [3] Author of the book CRM at the Speed of Light and nominated many times among the greatest international CRM experts. [4] For a more complete description of Social CRM see “Il Social CRM mette il cliente al centro del business” (Social CRM puts the customer at the centre of the business), in HBR 2010. [5] CRM stands for Customer Relationship Management. [6] See for example How Do Best Buy Manage Social Customer Service? [7] See [8] See The Metamorphosis To Agile Customer Service, Forrester 2011. [9] See The Consumer Decision Journey.

[10] Zappos is the world’s largest online shoe store and was recently purchased by Amazon for 1.2 billion dollars. [11] Fico is a company that provides credit evaluation services. [12] For further details see Customer Service Marketing e Social Business. [13] The model presented was introduced and discussed by the author for the first time in Il Futuro del Customer service (The Future of Customer Service) and in Il Nirvana del Social Support (The Nirvana of Social Support). [14] Customer Service Representatives. [15] The channels where customers interact are not always under the brand’s control.    

9. Enterprise Strategy, Policy and Governance for Social Media

The fast-approaching threshold of one billion Facebook users is the most striking sign of the unstoppable spread of social media worldwide: social media is coming out from the circle of web enthusiasts to conquer an ever more relevant portion of the population, influencing their tastes, purchase intentions and expectations. Today more than ever, for the brands of any sector, it is important not only to understand this phenomenon but to know how to use it to establish more significant and lasting relationships with customers and consumers that are able not only to reinforce purchase behaviours but to more widely involve the entire business ecosystem (suppliers, employees, consumers and opinion leaders). A recent Nielsen study [1] shows how the so-called “web 2.0” is today appreciated by three quarters of users, occupying 22% of their time online. Much of this time is spent playing an active role within groups united by an interest, a need, a passion so strong as to make communities the fastest growing sector of the whole Internet [2] (+5.4%) and capable of reaching a larger number of people than email (66.8% against 65.1%). These networks are now “seen as special” by companies because 70% of users have a lot more confidence in the opinions posted by their own peers than in the messages of traditional advertising (steady at 14%). This percentage increases to 90% when opinions and recommendations come from people they know. The opportunity inherent in social media is even more evident when adding that, for example in America, as many as 93% of interviewees would like the companies they have contact with to be accessible on social media [3] in order to provide better services (56%), solve their problems (43%) and collect feedback on products (41%), including on the move. In line with the international framework, Italy is among the most evolved European countries as regards the use of social platforms, especially Facebook.

The customer has changed: the social customer A revolution in methods of communication has followed an even more relevant revolution in behaviour. What is emerging from the data is a new type of consumer who is extremely active on social networking platforms such as Facebook, Twitter, Youtube and Flickr, and interested in a more lasting, transparent, deep and joint relationship with the brand. Thanks to the quantity of information and the possibility to connect with millions of people online, thesocial customer: •

is more demanding because it is more expert and constantly updated on the latest product characteristics;

believes little of advertising messages and before purchasing prefers to form a personal opinion online;

loves sharing feedback and comments, in particular when the experience has been highly negative;

expects its point of view to be listened to 24 hours a day, 365 days a year, regardless of the channel chosen to express itself;

asks to see its own feedback included in the evolution of products and services;

uses smartphones and other mobile devices to track down at any time the indications it needs, especially through the networks it belongs to;

knows it has a voice with which it can speak directly to the brand, not only as a customer, but also as an ambassador and influencer (for better or worse);

wants to be respected and treated transparently strong with the weight taken on in its own circle of contacts.

The diagram in figure 1 highlights the characteristics of the Social Customer, who is more knowledgeable, more prepared and who holds a constantly growing power in relation to the brand.

Characteristics of a good Social Media Strategy plan Where should we begin in order to devise a strategy for a company’s presence on social media? Let’s start with some indications taken from our projects:

The strategy is a “tailor-made suit”, no scalable strategies or packages valid for every company exist: the creation of a strategy should always be preceded by an accurate assessment, to properly understand one’s own market and customers, and by an internal analysis concerning the problems that could hinder the correct development of the strategy itself.

A good strategy is always co-created: Social Media Strategy is a mix of objectives, rules, values and guidelines that are impossible to identify without close collaboration with the company itself. The role of the consultant is to put the company and the brand in the position to have the best exposure on social platforms, without replacements. In order to

work well, a strategy needs a strong commitment from above, the consent of the various departments and managers concerned, and of the various stakeholders. •

The strategy must be accompanied by a governance plan that can govern the daily management of the social platforms.


The entire company is involved: a good strategy passes over existing silos, involves and holds together the objectives of communication, marketing, customer care, HR, sales, the product and innovation. In this sense the strategy (and governance) must be accompanied by a Social Media Policy aimed at providing operational advice to all the people within the company who operate, whether officially or not, within the social platforms where the brand is active. A good strategy does not stop at providing indications regarding individual platforms, but is able to communicate the company’s real objectives, including long-term.

The starting point: listen, listen, listen A Social Media Strategy is based on a fundamental process that starts with listening, by monitoring online conversations to understand how consumers perceive the organization. The diagram in figure 2 shows the process leading from active listening (Social media listening or monitoring) to the customer to a wider involvement, highlighting how Social Media Strategy is simply the end of a very precise journey that in turn is placed as the starting point for new activities in relation to the customers, in an active and recursive mechanism.

Prospects of social media strategy The value that Social Media Strategy can bring has different possible deviations. In our experience there are at least five scenarios to work on, which are listed in figure 3.

Examples of metrics for different Social platforms Brand Platform

Brand Awareness

Word of Mouth Engagement



Number of fans §







of §

of §




active users

Share of Voice §





users’ timeline §








profiles §



contents shared

likes §


Sentiment +/-


users §



contents published


users Twitter



of §

tweets regarding

Number followings

of §

followers the §

brand §



retweets of §

@replies of §

Number DMs


of (Direct

Sentiment +/-




Share of Voice





of §




Share of Voice §


of §


of §



downloads of §

registered members



likes §




incoming links §





Facebook §





Twitter §

Sentiment +/-

By describing in an operational manner how to build a Social Media Strategy we can identify a series of questions – shown in figure 4 – that it is useful to ask and that can guide us in creating what we want to obtain.

The work process As already shown, it is important to define the listening process: who are we listening to? Which public are we interested in involving? Where online is our brand being talked about? It is essential that a strategy defines clear business objectives that connect it to a very precise executive plan that also provides KPIs able to measure any success of the implemented activities. As regards the definition of KPIs, it should be underlined how each platform has fairly different metrics and logics.

One example and a summary, by way of illustration, can be taken from the diagram shown in Figure 4 that highlights some of the successful metrics of a brand within social channels. It is then necessary to anticipate a co-design phase and a period of experimentation in which the strategy is put to the test in the field to understand where to intervene and where it is possible to make improvements. A useful piece of advice could also be to start with some channels and gradually broaden the approach to other platforms.

The web as a mirror Interview with Giuseppe Cerroni (Head of Communication and Institutional Affairs at Autogrill) Why does a company like Autogrill have to be interested in social media? Whilst tradition mass media is tending to assume more and more of an “institutional� nature, becoming tools for a communication limited to certain respondents, on the web we witness an opposite process, so much so that today if a company wishes to examine a realistic image of itself it is preferable for it to use the web as a mirror rather than printed paper. Our interest in social media comes precisely from this, from the wish to listen and monitor what happens in this less and

less virtual universe. It is a complex listening process, because it involves, for example, redefining the parameters of authority and impact of sources. How are you planning to do this? The first step was starting up periodical web and social media monitoring. After this came building a social media strategy, a social media policy and social media governance. The objectives and rules with which the company will manage its social presence have been defined in a collaborative manner, by building a wide range of work teams made up of the different company functions involved in the subject. It is characteristic of social media, on the other hand, to make the boundaries flow and to reduce them, both the internal ones among the various company functions but also those between the company and consumers. Our Group is also present in 35 countries and there’s no doubt that the experience already gained by our business units in the USA and UK spurred us on. What are the areas of resistance and complexity that have been faced in order to do this? Whilst in the English-speaking world there is a greater facility to meet the consumer on social media, in Italy, in our experience, we are faced with people who are more oriented to critical attitudes. Some social media end up channelling a type of questions that evidently have no outlet elsewhere. This seems to me to be another interesting challenge that certainly needs to be dealt with, as does the challenge of transmitting complex company identities, both local ones and global ones simultaneously. Conclusions: connect Social Media Strategy to the organization and the workflow As we have seen when talking about Social Business, the traditional separation between the inside and outside of the company – with the new social tools – is lost. The split is made much less evident and it therefore appears necessary that, as external brands put a specific strategy in place to engage consumers, so too must internal strategies and policies be put into place that can allow the company to respond to requests coming from the outside. It is therefore essential that when transforming a company into a social business and creating a Social Media Strategy, the company must also be equipped with a social media governance and a

social media policy that clearly explain to employees how to use the new social channels and how to behave when on the various social platforms.

Social Media Listening - Example sections of a report Share of


The SOV helps us to better understand where our company is being talked about and how frequently this is taking place. It is a simple count of mentions but it represents a first, fundamental step to understanding how much material on us is online and in which online places interactions are most frequent. Trend The trend provides an indicative measure of the tendency of conversations in the period of

reference. By tracing a trend it is possible to understand if the specific initiatives launched by the brand in that particular period have attracted a certain amount of interest or not, or if some facts have caused a stir online and affected the company’s image. Categorizing messages




Within a good report, that offers a snapshot of what is being said online about a particular brand, there must always be a strong contribution from expert analysts able to determine the sentiment of messages, understand the deep sense and reposition it within the broader vision of the entire report. This is as if to say that it is not enough that there are data and numbers but that the good “assessor” must always translate those data and values into suggestions and specific indications in order to




more complex


A good reputation analysis is based above all on this point which is unlikely to be able to be entrusted to a tool (as valid as it may be). Influencers Wherever possible it would always be important to try to identify who are the opinion leaders, the most important sources and the people who move information on our brand around online. Customers Engagement means the relationship between the interactions of users (comments, likes, shares) and the total number of views. Conversation


This means the relationship between the users participating in the brand’s discussions/initiatives and the total audience exposed to the brand’s communication.

[1] See [2] Nielsen, “Global Faces on Networked Places”.

[3] “Cone Finds That Americans Expect Companies to Have a Presence in Social Media,”


10.Innovation today What is innovation? If we take the dictionary definitions, we find things like “introduce something new” or “a new idea or method, or tool”. In short, a novelty. So then, if one morning you get out of the wrong side of bed, have you been innovative? If you find a new way of using a document are you creating innovation? We believe that this ends up trivialising what is truly innovation. Let’s try to start again from the definition of innovation. From our point of view innovation regards problem solving. It consists in finding new solutions to present problems, or even in discovering problems that people might not even know they have, thus improving their lives. One of the biggest problems that we have noticed over recent years in innovation concerns the spending and investments that are being made in research and development, expressed as a percentage of the gross domestic product: they have continued to decrease significantly as shown in the table below: Country

R&D (in billions of euros)













Korea GB






Source: Main Science and technology indicators, OECD

We have less research and development. All the resources are in fact concentrating on development, which means that we are developing products and services for which we know a market already exists. The majority of research laboratories that once existed now no longer exist. All of them, without exception, have cut out projects in which they were investing, in order to concentrate on the four or five projects for which they are certain there is demand. In other words, they are only creating what is commonly called incremental innovation. If we think of the size of problems that the company is dealing with (energy, economic crisis, environment, etc.), these are not problems that will be solved by choosing the colour of an iPhone. These are fundamental problems that have yet to be solved, and we cannot solve them if we remain anchored in what we already know. We need new knowledge, we need to explore new intervention paradigms, and new research, that allow not the expected results, but the unexpected results, and that as a result are capable of changing things. A search in Google for books with the word “innovation” in the title finds 120,000 books. Just five years ago there were only a few hundred books with the word “innovation”! There are too many books on innovation and too few on real innovation. Potentials of the Social Web Where can we find true innovation over the last few years and what are the new paradigms in line with the “network society”? Think about the internet and how it has profoundly transformed our lives. Think about how much time it took for the internet to be successful: 30-40 years for it to become what it is, for it to have such a profound effect on our lives. The internet came out of the Bell laboratories of General Electric. There they invested in pure research, without the slightest idea of what concrete results would have been obtained. The internet itself was an unexpected result, among many, of a great amount of intense research driven by military needs. Where is the research that may generate unexpected results with regard to media communication, new materials, and new energy frontiers? Where is investment being made today to achieve these critical results for our future? We have not seen many initiatives going in this direction.

We are at a turning point, a consequence of the internet: social web. We are starting to see that there are strong possibilities that collaboration will become a fundamental driver to accelerate processes and information exchanges. The possibility for billions of people to start to connect and communicate in new ways has never been possible in the past; it is a significant step forward and offers enormous potential. The true challenge is how to seize this potential, both as companies and as a society, in order to change the way of innovating. We see two different types of companies: one includes those that we call “winners”, i.e. those companies that are willing to take risks and therefore to upset the market by making things that previously did not exist; the second type includes those companies that we’ll call “losers”, those who are afraid of changing, i.e. companies that have a strong position and are trying to defend it, rather than create new positions for it. Let’s take the case of Apple: did it listen to its customers, and use an “open” process, when it was thinking of creating the iPhone? No, contrary to what we usually hear, it was a completely closed process, based on the quality of internal Apple resources that carried out research, investigated the problems experienced by people, and had the vision of how a new service could have been. They had the leadership, ability and willingness to take risks. They had the courage to say: “People have never heard of an iPhone, but everyone needs one”, and they created it. We can’t go to customers and look to them for answers, or get a concept of a new product from them when they don’t even have an idea that the possibility of it exists. These are the limits of crowdsourcing. Leadership and social capital The heart of the question is leadership. We remember Kennedy’s speech when he announced to America that a man would have been sent to the Moon: it was a risky challenge, but taking this idea forward meant discovering and finding solutions to many of humanity’s problems: this extraordinary vision ruled American society, dragging everyone behind it, because in taking man to the moon America created new industrial sectors, it created innovation, and Silicon Valley was in large part driven by this research. The spin-offs generated by the technology developed for this venture were numerous, but when the space program began no-one could have imagined what the

developments would have been: new materials, new technologies for calculation and communications, etc.; or that companies would have been created that today have an annual turnover of billions of dollars and that these new activities would have given jobs to millions of people throughout the world. These results after the fact did not drive the action. People developed the space program because they believed in a problem-solution process that would have allowed them to discover new areas of knowledge. Now the situation is completely different: there is no driving vision; everything revolves around cost-cutting, and that is a very serious problem. Companies like Nokia, who had dominant positions on the market, are very cautious, and do not want to squander the advantage and destroy or deteriorate the ecosystem around them in which many benefit from the value chain they created. Take what happened, for instance, with the arrival of IP voice servers that made the voice nothing more than another Internet application: everything that the business had been built on, and everything that had been defended for years by keeping others out, now seems like a common commodity, because anyone can create a voice application. Thus, these companies end up adopting very defensive behaviours, which in fact become major obstacles to innovation: the people inside these companies are isolated and the chance of them being able to do things that are truly new is becoming all but impossible. These heritages are becoming serious obstacles; we have business models that are no longer up to date, that no longer allow us to generate past earnings: the CEO of a telecommunications company must think in the short term, three or four years at the most, trying to maximise the value of shares in that restricted period. This means that what the company can do is limit itself to what it already has, to what can give in the short term a certain return – even if small – and what it cannot do is invest in long-term research, necessary in order to have a future. As a result, the staff within an organization end up destroyed, as they are deprived of an environment of exploration, of reasons to take risks, to do something truly new. It is no coincidence that the breakthrough innovations of the last 15/20 years did not come from telecommunication companies.

It is time to talk about social capital and innovation. Today we have real possibilities of creating great innovations if we are able to combine two things: the vision and leadership of a Steve Jobs with the potential of the people within the company, or rather its social capital. If a company can do that, it can take assume a dominant position on the market. Social innovation: building communities for innovation To focus on social capital, a starting point is the digital generation: a generation of young people have grown up with this technology and no longer consider it “technology”, but rather their way of being in the world. They are not digital children because of digital technology, but because they were children when this change happened. This technology has been internalised by them because it allows them to carve out spaces for themselves, where they can do the things they need whilst growing up: create their own identity, have fun, do crazy things. MySpace or Facebook were not successful because of the technology, but because there was a new form of expression by this generation, in which they could express and acquire knowledge or simply act like kids. The crucial point of all of this is that new generations are established on social relations, and their way of existing in the world is today mediated by this technology. When individuals from this generation start working at an organization – such as a large company – they feel suffocated if people start telling them what they cannot do, and if they are isolated by those social tools that have made them what they are. These tools, instead of being seen as a threat (as many CIOs do), should be seen as opportunities: the consequence of social networking that these individuals experience and that has created their identity, is that in this way they have created collaboration without wanting to, they are collaborating in ways that were inconceivable in the past. This is the potential that is found in what they do, but how can it be exploited within companies? The social capital or, in other words, the network of formal and informal relations existing within the company, represents how the company itself truly works. Each organization has a formal structure, from which it can be deduced who holds what positions and who reports to whom; but when we try to understand how things really work, we discover a completely different network: people know who to turn to in reality to make fast and effective decisions, regardless of what the organization

chart says. Each person knows who to turn to if he/she has to collect up-to-date information on a technology or on the product market. This relation network – the social capital – is what we must free up today if we want to exploit it to our advantage. So, how can we make it grow? Today platforms exist that allow people to find others like themselves, who can be found in parts or roles that are very different from the company, but who share the same passions or the same experiences. For the first time people are allowed to discover and rely on this sort of intangible network within organizations, whose existence was not even known about before. It is a way of seizing the possibility for these people to find each other and start working together in ways that were unimaginable up until now. Organizational silos are bypassed. These platforms also highlight the contribution that the individual can bring to the group. Should we tend towards incremental innovation or towards radical innovation? We believe that this is the wrong question, and that the right question is: can we have both? Is it possible to have the leadership, vision and culture that allow an organization to take risks, at the same time allowing people within the organization to come together in completely different ways than in the past, in order to use this strength to guide the change? It is possible if we are able to create the right motivation and the right context. The answer is not just in the technology. Everything depends on the organization and its culture. It is not about “capturing” ideas, but rather about building communities. The fundamental point is that key players be identified, the right people at the right time, to transform their network and their informality into a business value. From these assumptions – of social capital as a true element of a company’s distinction and advantage – approaches such as Idea Management and Social Innovation are born.      

11.Innovation through collaboration: how to make the innovation process social

“Creativity in itself shouldn’t be encouraged: we instead need to encourage creative solutions to real problems. Innovation is only “good” when it’s useful.” “There’s no such thing as a bad idea! Just poorly executed awesome ones.” Look beyond innovation for the sake of innovation. More and more organizations today find themselves having to find and exploit new ideas and opportunities in order to respond to growing competitive pressure and to changes in customers’ needs. The recent economic recession has only further accelerated the urgency of this change and the “demand” for innovation for companies. The main objective of innovation is not (only) to create the next hot product. Various types of innovation exist and people need to be engaged and stimulated to recognise and pursue not only product innovation, but also process or business model innovation. We need a way to encourage innovation and make it “normal”, namely not to separate it from the rest of the business. It has to be treated systematically, like any process in which a problem is determined and a solution is found. Some of the key questions we need to ask ourselves are therefore: What do we want to obtain and how? What resources will we need? Who will be part of the team? What will be the factors to motivate people and what recognitions will be given? How will the initiative’s success be measured? Creativity therefore doesn’t have to be seen as a mysterious gift or prerogative of few “talents”, but as the – daily – activity of creating not obvious connections, putting things together that are normally not together. Innovation is always more the product of a collaborative process among individuals rather than the result of the intelligence of a single person. What is Idea Management? But where are all of these innovative ideas hidden that are so necessary to drive growth, productivity and value creation? When innovation is more important than ever, the collaborative management of ideas (collaborative idea management) through functions and geographical areas

can help organizations to make new ideas emerge, and to refine them and ensure that they reach the right people. This approach is also a way to make employees more responsible and recognise the ones who are more active in the innovation process, so as to measure and stimulate creative activity and to promote a more open, collaborative and social culture in organizations. In other words, to create one or more innovation communities that work in a vertical or cross-cutting way in organizations. Idea Management is a structured process – an integral part of the innovation process – aimed at the collection, management, selection and sharing of ideas. This process is typically supported by specific technologies (Idea Management Platform) that provide methods and tools that make the union of ideas, their assessment and – in some cases – even their execution, more effective and amplified. Idea Management can be applied in various contexts, from incremental improvements to more radical ones, and it can even cover the entire company ecosystem, including external stakeholders, partners and customers. It is the social evolution of the traditional “idea box”, where, however, the use of the social processes and technological platforms of Idea Management profoundly transforms its nature:

Various forms of participation: these systems value the contribution not just of the idea proposal but also of the cross-valuation (vote), comment or criticism of the idea;

Contamination: everyone sees proposals from colleagues and a consistent idea can be born out of a proposal which in itself is not very concrete, or is unfocused, by enriching the information and/or concept;

Emergence: the most read, most commented or most appreciated ideas emerge and stand out from others, allowing the community to rapidly see the selection process in progress;

Collective Intelligence: if duly supported, the community can make proposals evolve by exploiting the intelligence and knowledge present in the system;

Focus on people (and not just on ideas): the proposals that stand out also identify a group of people who believe in the idea and who could also be involved in its implementation.

How to make the innovation process social There are quite a few contributions that underline the importance of considering innovation as an open process that must involve many players within or outside the same business ecosystem. The concept of “players” in the innovation process is important and interesting, because it reinterprets a “social” company role that is not always made clear in an organization chart (or rather not only focused on the R&D function) or in a specific organizational role. Unlike the traditional stage-gate selection process, the social approach to involvement and to the realisation of ideas and improvement projects is based on the activation of three different communities: he who brings or generates ideas (explorers, perhaps the most common meaning of innovator), he who carries them out (exploiters), and he who has the task of selecting and assessing them. It is precisely this last role, typically concentrated in Management, which is of fundamental importance for facilitating and “bridging the gap” between explorers and exploiters. Instead of acting as a restraint or gate-keeper (as a team would act by sticking to the assessment methods based on expert committees), the team has to act with a role of broker, a key figure who supports and accelerates the realisation of an idea. A typical innovation process will therefore have the structure shown in Figure 1. PHASE 1: Setting of objectives and scenario •

Identify the topics and main areas of applicability of the initiative. A punctual analysis can help to understand both the sensitivity of an organization towards specific business topics and the level of cultural alignment on the social approach to innovation (readiness);

Identify the key players in the innovation process: therefore not only the formal figures, but above all – as we have already seen – those who already play an important role at an informal level (e.g. broker);

Specify and define the topics on which to start the first phase of idea production;

Involve and form the support team (experts, assessors, moderators, …).

PHASE 2: Generation of ideas •

Launch the initiative on a restricted group of people (soft-launch) with the twofold objective of having a punctual feedback from end users and starting to populate the platform;

Involve a wider group in the generation of ideas (full-launch);

Punctually manage the growth of the community, timely intervening to “correct” negative behaviours (e.g. unconstructive comments, missing information, inappropriate language) and award positive ones (e.g. connections between ideas, precise comments, …);

Communicate the state of progress within and outside the community, also giving visibility to Top Management.

PHASE 3: Idea selection •

Give visibility of the phase of approval of single ideas directly on the platform, punctually engaging the experts in the assessment;

Select the ideas (or groups of ideas), based on various KPIs. Ideally, the services on which it is important to concentrate are impact on the company (e.g. turnover increase, cost saving, scope of the idea, brand value, …) and feasibility (e.g. resources necessary, time to market, investment, …);

Award those who come up with the best ideas and…realise them!

This process, especially in phases 2 and 3, can obviously be repeated whenever new innovation initiatives on specific topics are to be launched (see figure 2).

What to do and what not to do. We end this article with a series of pieces of operational “advice” based on our experience: •

Establish clear objectives. At times collaborative innovation initiatives are born within organizations as experiments or as extensions of collaborative social aspects. In these situations, the “learning by doing” approach sometimes takes over, and risks defocusing and dissolving the experience. In reality, to ensure the project’s success it is useful to initially identify clear business and result objectives, so as to strongly link the innovative process to an additional value brought to the organization and to its stakeholders.

Know the target. Before launching an innovation initiative, it is important to know who the participants in the process will be, in terms of profile, role, business unit and localisation in order to outline the best engagement strategy possible. Culture-country aspects must also not be underestimated. Tools like Social Network Analysis can also shed light on the existing collaborative dynamics and on the roles that some key players already play within the organization. These people should be punctually involved.

Manage the change and the alignment with the company strategy. The addition of an Idea Management tool must also be accompanied by a process of change management

and alignment of the innovation initiative with the company strategy. There are many hidden barriers, firstly the natural low propensity to sharing and collaboration and the calling into question of formal roles. The communication, sharing and engagement of stakeholders in the process, especially if the approach is new within the company, are key to the initiative’s success and adoption. •

Balance quality and level of engagement. Quality of ideas and level of engagement (e.g. number of people who actively participate) are two often conflicting objectives. We therefore need to know how to balance these two aspects in the various phases of maturity of the initiative, initially favouring engagement and introducing metrics to assess the quality of contributions once a certain consistency and stability has been reached in the community.

Exploit online and offline communication. As visually engaging and refined as it may be, online communication alone (email, launch videos, ….) still shows its limits. The best initiatives always mix online and offline elements in communication, especially when specific populations have to be involved in the initiative.

Being transparent in the assessment process. One of the weak points of the idea box approach is its lack of feedback in the assessment process. On open and social platforms, every remark, every feedback (e.g. a critical comment from an expert indicating the weak points of an idea) can be both the mainspring that makes the idea itself evolve and a moment of personal “formation” and formation for the community as a whole.

Finally, a few points for attention: •

Only concentrating on the “numbers”. Modern platforms offer very refined and punctual analysis and reporting mechanisms. It is however important to avoid concentrating too much on the numbers alone (e.g. ideas, votes, comments posted, …), because the real value is in the interactions between people and the connections they generate. Different cultural backgrounds produce creativity and innovation. Favouring and appreciating different opinions, identities and perspectives therefore generates a greater level of

innovation. Although it is possible to measure these dynamics, a linear relationship does not always exist with real added value. The phrase “Not everything that counts can be counted” is therefore valid. •

Lowering the guard on community management. The promise to involve employees in an open, collaborative process of research and development of new ideas is certainly compelling. However, once the initial novelty and interest period has worn off, the community’s activity must be supported by constant specific communication and engagement initiatives. Be careful not to overestimate the impact of gamification dynamics which, alone, cannot increase and sustain the participation and involvement of users.

Sidelining usability and graphic aspects. The consumerisation of IT cannot be ignored. Users, whatever their profile or role, will definitely pay attention to aspects that are easy to use and access. It is therefore better to spend a bit of time making the user experience easy and pleasant.

Not involving sponsors/executives in the process. Innovation within large organizations is often thwarted by the presence of inflexibility, a uniform company culture, and communication flows that are too formalised. Executives therefore have the fundamental role of facilitating and accelerating the various phases of the innovation process and, ultimately, realising the ideas. Having finally stressed the aspects of change, the involvement of senior figures is important to lead (in terms of leadership) the cultural and – where possible – organizational change.

Collaborative Innovation to create value in the company Interview with Sergio Farioli How did the use of Collaborative Innovation within Luxottica originate and what were the strategic reflections/values taken into consideration when deciding to apply a new model? Luxottica is a multinational group with a presence in over 130 countries, an integrated business model, ranging from production to distribution, with 11 plants and approximately 7000 shops, and a product consisting of 45 trademarks and over 55 million eyeglasses produced every year. Our growth in the last 20 years has also occurred through a series of strategic acquisitions that have brought different models and cultures inside the Group. Within this framework of reference, one of the key objectives is to make all of our people collaborate effectively and efficiently. Collaborative Innovation is therefore one of the tools that we have identified to create a smooth process of generation of ideas and innovation, and therefore value for the company, exploiting competencies and knowledge within the company, at all levels.

We believe that it is precisely from an open comparison between different cultures and points of view that creativity and innovation can be generated. How did you approach the development of Collaborative Innovation? We began with two main aspects: the topics of innovation relevant for the company and the stakeholders, and the people to be involved in the process. Both aspects were critical for us and we dealt with them by identifying the topics through a series of analyses of relevance, and selecting a group of approximately one thousand cross-functional, cross-country and crosshierarchical “innovators” by means of an Organizational Network Analysis (ONA). Once the topics and people had been identified, we developed a structured process, supported by an Idea Management platform, for the collection, cross-collaboration and cross-valuation of ideas, creating communities of “innovators” who worked together on specific topics. Collaboration occurs not just by proposing new ideas to the community, but also through a crowd-sourcing approach in terms of votes, comments and the emergence of ideas that the community judges to be of greater relevance and/or value. In this way we were able to make people work together constructively, people who because of their role, function or geographical area had never met before. Finally, we assessed the best ideas emerging from the process through a materiality matrix, in order to identify the priority initiatives to be implemented

Taking into consideration the whole idea management process, from identifying the challenge and the population involved, to the assessment and implementation of ideas, what are the most critical phases in your opinion? The introduction of a new method of working in a team of over a thousand people has involved significant and continuous change management challenges throughout the process, but specifically I would identify: •

Choice of topic: correctly identifying a relevant topic (for the company and for the stakeholders) is fundamental to guarantee value creation in the process and in the results.

This type of analysis is not always easy and assumes an openness by the company to transparently sharing topics which are at times critical. •

Level of engagement: a good level of involvement and motivation in the participants and in the leadership is important to facilitate the cultural change that the solution has introduced into the method of collaboration and interaction among people. Communication is definitely an important aspect in this which must be carefully managed.

Change of leadership model: an approach more oriented to coaching and support, compared to a hierarchical/management model must accompany the development of the collaborative environment, making emerge and rewarding competencies, abilities and knowledge including outside of the organizational/functional framework of reference.

In conclusion, what lessons has Luxottica learned from the application of Collaborative Innovation? Our experience has been positive up until now and we expect to progressively broaden its field of action. The use of a social approach in innovation has definitely helped us to: •

understand and make our new methods of work collaborative and speed up the decisionmaking process across the organization, functions and geographies;

map the collaboration and communication dynamics and informal networks within the organization, understanding their logic, exploiting their strong points and monitoring their evolution;

make the most of and best use the collective intelligence and experience of the organization within an informal, but at the same time structured and repeatable, process.

collaborate in extended groups using more efficient, effective and focused tools than those usually used and than e-mail;

deliver knowledge and ensure it remains available to everyone.

The first Innovation Challenge was focused on the reduction of waste in the work place with a view to cutting down the environmental impact, a very important topic for the Group. In less than a

month, 210 ideas and 550 comments were collected from all the Business Units and all the countries where we operate (in particular Italy, United States, China and India). Starting from these proposals an action plan was drawn up and shared that states concrete and specific activities for each company of the Group. Throughout the first challenge, the site received on average 50 posts (ideas, votes, comments) a day. Based on these experiences and remarks, we are working on evolving the approach used towards a permanent and structured Collaborative Innovation “platform”, open to all areas and geographies of the company with the involvement of wider populations. In practice this is the creation of a company asset that allows us to rapidly involve our company on the topics of innovation and creativity, using the great collective intelligence of Luxottica.


12.The ROI of Social Innovation In a previous article (“Verso il Social Business”, HBR Italia, May 2011) we showed how social capital present within every company (informal networks made of trust, cooperation, autoactivation, etc.) can – if correctly understood and integrated into formal processes – be an important source of improvement to company performances. In this follow-up article we will look at the case of an early adopter that applied typical Social Business philosophies and technologies to the management of innovation processes. What we have discovered is although social technologies have been able to significantly increase the level of collaboration within organizations, this aspect is only a small part of the true return on investment (ROI). The ideas that come from crowdsourcing or feedback from customers truly translate into ROI only when the changes are effectively implemented. Many social innovation adopters that we have observed have in fact been able to successfully apply open and collaboratively approaches to the collection and creation of new ideas; however, these high-potential ideas are then forced through a traditional top-down process to receive an approval that allows their implementation. The resulting deceleration of the innovation process not only puts the potential ROI at risk, but also has a demotivating effect on all those who contributed to and participated in the collaborative innovation process. We are of the opinion that in order to reach a significant ROI, the social approach has to permeate the entire innovation process, from the idea exploration stage, to the involvement of management, until the implementation of the ideas. Being “social by half” simply does not work. The contribution that the approach based on networks and community strength can give to innovation processes extends to all its stages, as the “4E” Establish model shows in Figure 1 “The innovation process from a network perspective”. This approach – very integrated with Organizational Network Analysis and with the informal roles codified there – highlights the features and specific dynamics of each stage from a network perspective. Experience in the field shows us that each stage has specific players and dynamics:


Explore: in this stage the ability to intercept innovative proposals and bring them into the system depends on factors such as §

Weak links (the more stable and lasting links in fact tend to confirm paradigms and established beliefs) both inside and outside the organization;


Variety and diversity of points of view, very relevant to surpass the system of values and meanings that have been established and open the road to new perspectives;


Ability to listen/integration towards nodes/subjects that are less integrated and central in the system, often more exposed to the outside;


Ability to connect and contaminate apparently different ideas (idea brokers, idea connectors);

§ §

Ambiguity and redundancy, which in complex systems are the breeding ground for the new.

Evaluate: the evaluation of ideas is a critical moment of traditional innovation processes; the more sensational the proposals, the more the evaluation standards tend to reject them; from a network perspective the evaluation stage is effective if: §

The perspective of the decision-making roles matches that of the less central and integrated nodes;


The emergency mechanisms bring to attention the level of activity that is underneath each proposal (comments, rankings, visibility, endorsements) and they allow the system to reconfigure itself in a dynamic manner;


The explorers that have proposed, made evolve and supported the ideas can bring their energy to the innovation process;


Contributions from outside the system support the decision makers in making evolve the evaluation standards and criteria and more generally the managerial culture (risk, error, planning, tradition, etc.).


Engage/Exploit: the implementation of new proposals can be greatly accelerated by adopting a Social Innovation model, provided that: §

The team of exploiters has links and overlaps with the team of explorers;


The team of exploiters works in order to implement an innovation from which they will greatly benefit (the “pull” logic) and not only as an initiative to take forward (the “push” logic).

The ROI of Social Innovation Social innovation platforms have proven to be very valuable for those organizations that first turned to Social Business. The promise of involving employees in an open, collaborative process of research and development of new ideas is certainly compelling. Some of these platforms, moreover, include innovation engagement dynamics (gamification) that represent real added value to increase the participation and involvement of users. The observations that we have conducted on different initiatives have shown how users are in fact initially enthusiastic to participate in and explore these platforms by collaboratively developing new ideas. ROI, however, is not realized until the ideas are concretely put into practice (exploit). In this partial application of the social innovation model – solely focused on the generation of ideas – we end up repeating the same approach as the “selection committee” typical of the “idea box”,

thus closely following the very classic patterns that social innovation platforms should have replaced. The result is, in short, the same: a small group of “winners” emerging after a complex evaluation process. Even if the number and quality of the ideas developed in a collaborative and open manner may be higher, in the end the result does not appear to be very different, with consequent doubts on the effective ROI of social innovation platforms.

The case of a UK public company The 4E model of innovation suggests that the shift from exploration to implementation of ideas is often mediated by some key individuals who are able to successfully bridge between the communities of explorers and those of exploiters. From a network point of view, we expect the communities of explorers to be dynamic, emerging and open, with participants who experiment with every opportunity in the most creative way possible. The communities of exploiters – on the other hand – are characterized by much tighter and more closed articulated connections, a fundamental requirement in order to rapidly and efficiently take a product from design to market.

We are convinced that, as much as committees concentrated on the approval of ideas are institutions with clear intentions and methods, they are not able to bring all of the intelligence present within their organizations into the evaluation process. The amount of information and evaluations that can be moved with a social innovation model is far more useful and effective than that of a restricted group of experts. In our experience the two components (concentrated evaluation and distributed evaluation) can co-exist with a great return. In particular, we have observed that by reorienting the role of the selection committee from gate keeper to idea broker, the speed of adopting ideas can be accelerated. This is what happened in a social innovation experience at a public service company in the United Kingdom. In the first year of activity over 1,000 people registered and commented, sent or participated in approximately 700 ideas. What we discovered is: •

During the launch of an idea, the activity generated by users (comments, “likes”, etc.) was equally as intense both for the ideas that would have subsequently been approved and for those that were later rejected;

As time went on the activity gradually reduced for ideas destined to be rejected, until reaching activity levels that were on average three times higher for the subsequently approved ideas compared to the others;

The ideas destined to be approved share very similar network features (see Figures 2 and 3, Egonet of an approved and rejected idea): it is possible to create a model of links for each idea with the system nodes (Idea Egonet), which is especially interesting for its predictive value.

The central node represents the idea. The other nodes represent the people that have interacted (comment or vote) on the idea. The line that joins two people together indicates a shared comment or a discussion on the idea. Lessons learned Potentially, the typical metrics of Social Business – such as the convergence of different idea supporters, together with consistent activity levels around an idea – can be used to monitor the

entire idea evolution process. Unlike the traditional stage gate selection process, the social approach to involvement and to realizing ideas and improvement projects sees teams of managers who activate themselves in facilitating and bridging between “those with ideas” to “those in the best position to realize them”. Instead of acting like a restraint or an approval gate (as they would under traditional evaluation methods based on committees), the team has to act with the role of broker, a key figure that supports and accelerates implementation and, therefore, the ROI. Ideas therefore proceed or fail based on the level of involvement that they are able to reach in the network of exploitation. In this way, successful ideas are brought forward through the network by those who most benefit from their implementation (the “pull” model), contrary to the traditional process of pushing the idea forward (the “push” model). Ideas unable to earn sufficient support are “naturally” discarded. Transparency in the process provides a greater sense of ownership for realized ideas and, perhaps, less disappointment for the rejected ones because of the lack of visible support.

Conclusions Social Business has matured to such a level as to raise important questions on the return on investment. The first to adopt these business approaches adopted an incremental approach – in small steps. Inevitably, when Social Business practices encountered traditional top-down management processes, the potential results were weakened or even stopped. Unfortunately, being “social by half” cannot work. In order to obtain ROI, Social Business practices have to be maintained through the entire value chain, from creation to final implementation and realization of the related benefits. This means rethinking the role that a manager has within the innovation process: from gatekeeper to broker. This is in fact the line separating “non-returnable investments” from initiatives that successfully pay off.  

Social Business Manifesto (EN)  
Social Business Manifesto (EN)