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Enterprise Social Networks -- To Be? Or Not To Be?

Recently, actor Ashton Kutcher and several CNN star anchors including Larry King and Rick Sanchez got into a celebrity feud, resulting in a two-horse race between the actor and the network for the bragging right of becoming the first party to reach 1 million “followers” on Twitter.  What ensued was a Twitter mania, heavily hyped over the Internet and CNN airwaves for weeks, which finally culminated on April 17 when Kutcher first clinched that magic number, with CNN trailing closely, also reaching the same milestone 30 minutes later.

Social network services (SNS) have been gaining huge popularity around the world in the past few years.  Now, with traditional media’s obsession about them since the Obama campaign, consumers and investors alike are flocking to various SNS en masse.  Not a single day has gone by without being bombarded by “Twitter this” or “Facebook that” everywhere, whether watching news on TV or chatting with strangers at parties. 

Riding high on this wave, Facebook announced in April that it has exceeded 200 million registered members.  LinkedIn claims to have garnered 35 million registered users across 170 industries and achieved $100 million annual revenues in 2008.  3+ year old upstart Ning, which allows users to set up free professional, semi-professional, or private community network websites, claims to have reached the critical milestone of one million networks, with a company valuation of some $500 million.  In addition, rumor has it that high-tech titans including Google, Apple, Microsoft, and Facebook have all been circling the Twitter wagon about a possible acquisition.  Only three years old and with very little revenues to speak of, this tiny company has amassed enormous following of late.  Some insiders point to its price tag at north of $700 million.  Meanwhile, China‘s newest SNS company Kaixinwang, having attracted 20 million members within 12 months, just closed a round of financing at $100 million valuation, where VCs were scrambling to get involved.  Financial crisis, what financial crisis?

SNS’s rapid ascend to the stratosphere reminds us of a movie from yesteryears — Back to the Future — apropos Internet Bubble 2.0 in the making.  Nonetheless, and undeniably, this phenomenon does present a breath of fresh air and a glimmer of hope in an otherwise cloudy and gloomy global economic downturn since 2008.

Truth is, the roots of SNS run pretty deep.  Way before attaining their current quasi-mainstream status, community based forums and chats had been the main stake of every pioneering online service, from Usenet and CompuServe to AOL.  But those services were confined to the “geek land” for the longest time, which pre-dated even the Web 1.0 era; mainstream media never laid an eye on them, neither did the general public, for that matter.  The advent of Web 2.0 raised social media to a much higher plateau, posing a much serious threat to traditional media than cable TV or Web 1.0 ever did.  One may point out, then, this is simply a conflict of the old school media vs. new.  What do SNS have to do with the enterprise and business?  The answer: they have everything to do with them.

How does the enterprise cope with this SNS tidal wave?  For instance, what is the company policy vis-à-vis an employee’s use of public SNS — prohibited, ignored, or encouraged?  Could or should an enterprise adopt and deploy its own corporate SNS to gain certain competitive advantages?  If so, does the company have the consensus and fortitude to establish it own “Corporate Culture 2.0” in response to the Web 2.0 onslaught?  In short, regarding enterprise social networks (ESN), it’s “to be, or not to be?”  That is indeed the most frequently asked question these days when I visit our enterprise customers around the world.  Corporate executives — CEO, CFO, CIO, or CHO — are simultaneously fascinated, confused, and concerned about this strange beast.

An enterprise’s primary asset is its people, consisting of a younger generation of “millennios” of the digital age, indigenous to Web 2.0, and an older generation who by now should have also become at least Web 1.0 “immigrants” so as to stay relevant.  With all the SNS hype, employees probably would have already joined various CSN, with or without the company’s blessing.  A Gartner Research Report[1] points out SNS being “inevitable and unavoidable” and that companies should embrace and harness such technologies.  Perhaps my recent conversation with the CIO at one of our Fortune 500 customers best illustrates this sentiment.  Having been in IT since 1972, he has witnessed and experienced every wave of disruptive technology.  His conclusion is that resistance to change is ultimately futile; the management paradigm shift brought along by SNS will be no exception.

However, adopting ESN is easier said than done, for it touches the very core of corporate culture — an enterprise's central nervous system.  Traditionally, companies operate via a top-down hierarchical structure; information is disseminated on a “need-to-know” basis.   Such management style is also reflected in the Web 1.0 rendition of enterprise portal and content management solutions that remain widely deployed today.  In contrast, SNS are about bottom-up, grassroots empowerment, granting everyone a voice — from employees to customers — by promoting a new “need-to-share” strategy.  Unfortunately, for companies whose culture is autocratic and rigid, it would seem like watching a powerful horror movie — too scary for the faint-of-heart and yet so tantalizingly enticing that you just can’t completely get away from it.

To fully harness ESN, an enterprise must be committed to transforming itself by developing its new “corporate culture 2.0” based on mutual respect and trust amongst all its constituencies across the entire ecosystem.  The mission is to preserve the merits of its traditional top-down, structured management methodology, but also to encourage bottom-up voices via user-generated content and unstructured, ad-hoc, but more agile collaboration via work relationships and social communities.  To accomplish these goals, we recommend two simple steps: (1) adopt a comprehensive ESN platform such as the Clearvale™ platform (www.clearvale.com) whereupon both top-down and bottom-up management paradigms can be fostered and interwoven; (2) establish a set of “ESN Protocols” through which the company’s communication, collaboration, and innovation strategies and best practices can be implemented and fortified.

SNS have already caused a sea change in how people connect and interact with each other and how they consume and disseminate information across the globe — gone are six degrees of separation or suffocating grip of the media oligopoly.  No wonder the world is getting even flatter and smaller everyday.

SNS’s impact on business would be equally profound, for both types of SNS — CSN and ESN — are extremely germane to how enterprises conduct their businesses in the future.  We believe Clearvale represents the most compelling solution for the enterprise because it embodies both “enterprization” of CSN as well as “consumerization” of ESN — the winning combination.  For those who know how to seize the moment, the future is now.  After all, this would be a perpetual learning process; the earlier you get started, the sooner you can thrive with it.