Tapping the value of crowds: going from social media to social business
Social media’s global popularity has been due, in large part, to its ability to help consumers make faster and better purchasing decisions (BPD). Consumers can view and engage in the news, compare prices, review products and more, all through social media. If there is no information on a particular product, they can simply ask their own network of friends and connections for advice. This results in a huge, consumer-induced body of collective knowledge and intelligence about products and services that is easy to access, grows organically and is highly advantageous to the consumer.
As consumers are taking advantage of this collective knowledge, businesses are starting to realise that they can gain a lot if they can leverage the right business know-how from their network at the right time. Like people, businesses exist in an interconnected ecosystem, consisting of suppliers, clients, customers, employees, partners etc. If this collective knowledge can be tapped in to, it could result in significant competitive advantages, allowing for better business decisions (BBD) to be made. However, current social media channels offer few means for businesses to access and use this know-how. Business ecosystems are hugely complex and have numerous types and layers of relationships that vary in scope, size and nature. Relationships can include consumers, suppliers, partners or shareholders. Decisions are based on multipart negotiations and a mix of information from various domains (such as legal, social, competition). This results in co-creation that is more iterative and interactive, requiring a higher level of integration of platforms aimed to facilitate crowdsourcing, sharing, connection and knowledge-creation.
Transforming a business into a social business means bringing together people (customers, the public, employees), businesses (partners, suppliers, stakeholders), and expertise (know how, business knowledge, intelligence). These can be brought together through open or closed online communities that are designed to facilitate the seamless transfer of knowledge and information across the various stakeholders. As a result, businesses will engage different communities, collaborate, crowd source for new, innovative products and solve problems – faster, more efficiently and more cost effectively. This social business revolution will lead to more connected, adaptive and intelligent businesses capable of building greater brand loyalty and recognition. Most importantly, they will be able to produce better and more relevant products.
A perfect example of this is Threadless, a company that produces t-shirts and allow anyone to design their own pattern and submit it through their platform. External interest was built through social media which drew users into their platform, where they were able to submit their own designs and interact with Threadless employees and other customers. Different communities were built, with some co-creating designs and voting on which designs to produce. Threadless ended up creating a global community of over 2.5 million enthusiasts and designers, over 500,000 designs of which 5,000 have been produced generating US$30 million in revenue between 2005 and 2012. Put simply, Threadless used crowdsourcing to create a BBD advantage. They accessed ideas from crowds of enthusiasts, enabling faster designs, accurate selection and faster response time to business needs.
Although Threadless created their own platform, companies can also use softwares or platforms that are already out there. Platforms such Microsoft Yammer, IBM Connections, Salesforce Chatter and Jive were primarily created for internal communication and knowledge sharing and are particularly suited for large corporations. In contrast, other players focus on unlocking the potential of companies’ ecosystem, and are better suited to SMEs. For instance, Xincus works with chambers of commerce and SMEs and offers a platform specifically designed for supporting the needs of small companies that are embedded in complex networks, or just those that want to connect with local stakeholders, potential collaborators or customers.
Overall, social business has the ability to open doors into a new world of knowledge and intelligence, potentially transforming the way businesses are run and decisions made. By connecting businesses to the right intelligence at the right time, companies will reap the benefits from BBD advantages. With the ever increasing growth in connectivity and social media, it is only a matter of time before all businesses follow their customers, and truly become social businesses.