Archive for the ‘change’ Tag

Social business replaces social media

Busy managers should be excused if they are not current on every development in the social media world. In discussions around digital transformation, one question regularly comes up: “Where is social media heading?” Based on our research and project work, we have identified four emerging social media trends. Overall, social media is morphing from a communication tool to a larger social business enabler.

1.  It is not just for the marketers

Marketing no longer has a monopoly on social media programs. Other groups like HR (for external recruiting), product development (for innovation) and customer services (for product support) are increasingly driving usage on these platforms and delivering business value.

2.  Content strategies are evolving

Most marketing efforts “push” content out more than 90% of the time. Marketers (and other departments) will progressively become more social, seeking a balance between pushing information and engaging their customers in dialogue around the content. Moreover, visual content will likely become more prominent in these social and collaborative conversations. Expect new social apps to better support the embedding of visual content (including live video) into conversations to better deliver sales demos or technical support.

3.  Resetting the community button

Many attempts at community cultivation are failing due to a lack of resources and mismanagement. Equally important is the dearth of dialogue-fostering social elements in the content, such as relevance and uniqueness that cater to specific interests. “At its core, social media is about being social. Your social strategy should be designed to deliver an interesting core message that wants to be shared,” says Marilyn Sinclair, president of communications company All About Words. Companies are steadily getting serious about building focused communities that emphasize social sharing.

4.  The rise of social analytics

To better target business problems, understand customers and generate enterprise-wide ROI, firms are beginning to analyze, listen and learn from customer experiences, and tap into the social pulse of customers, advocates, influencers and their collective networks. These learnings will improve the quality and quantity of social media interactions.

Social business initiatives are all about enabling workers to collaborate with customers through social media to solve problems or capitalize on opportunities. To do this, participant conversations will need to cross functions, locations and devices, blurring the barriers between the internal and external roles. This transition won’t be easy for every firm. Gartner, an IT research firm, predicts, “Through 2015, 80% of social business efforts will not achieve the intended benefits due to inadequate leadership and an overemphasis on technology.”

The following success factors can help a firm exploit the trend towards social business:

  • Make strong leadership and expert change management a priority

When it comes to leveraging IT, the corporate Achilles Heel is often internal adoption. All senior leaders — and not just the CIO — should prioritize social business initiatives, model the right behaviours and deploy the right change resources and tools to drive employee acceptance. For example, some CEOs are appointing Chief Digital Officers to drive digital adoption across the organization. In other cases, companies have created senior, cross-functional steering committees to secure alignment, focus and investment. Technology is merely the delivery system

  • Establish a clear and compelling purpose for social business from the outset

Most organizations look at collaboration as a technology platform issue not as a solution to a specific business problem. Having a platform view isn’t necessarily wrong from an enterprise perspective but it frequently leads to band-aid approaches that don’t get to the root cause of problems and typically get bogged down in organizational inertia.

“Organizations fall in love with the newest ‘thing’ and they want to be cool, but they forget that their objective is to compel an audience to do something specific. Clear, consistent and compelling messaging that address social business needs across all platforms is key,” says Sinclair. “Technology is merely the delivery system.” Social business is best enabled when the business problem drives all key decisions including technology choice.

  • Consider systems and cultural tweaks to support social business

Many companies today are not well organized to conduct social business. For example, community management and customer-service efforts often lack sufficient capabilities including tools, people and skills to deliver credible programs that address customer needs. In other cases, a firm’s organizational dynamics (e.g., siloed structures, and oblique processes), performance measurement tools and culture norms do not promote free flow communication let alone collaboration.

Companies can maximize the value of their social media investments and efforts when they shift from a marketing-centered, “push” approach to an organization-wide, problem-solving strategy that engages both the community and firm. The first step in leveraging social business comes from exploring how a company can meaningfully talk and listen to their customers and stakeholders to collaboratively address their needs through the right business solution.

For more information on our services and work, please visit the Quanta Consulting Inc. web site.

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Digital transformation’s first step

Most leaders we speak with are considering how to use digital technologies to improve business and financial performance. Research shows that digitally transforming a customer interaction or operational process can significantly improve bottom-line performance and enhance competitiveness. To exploit the potential of digital technology, the optimal strategy is to identify high-potential/low-risk opportunities, find enterprise-wide technological solutions and learn as you implement.

Digital business can be a game-changer. According to a multi-industry McKinsey study, digitizing the customer experience can boost sales and profits an average 20% over five years. From an operational perspective, leveraging digital technology can drive cost reductions, leading to a 36% improvement in profits after five years.

Digital technology can impact every facet of a company’s business model. Two areas in particular can yield significant value:

  • Improve the customer experience: Digital technology enables customers to get information and tools when they want it, as they want it. For example, the rapid rise of mobile computing has triggered major changes in buyer behaviour. Banks have responded by delivering their products and services through “always on” and data-driven mobile channels — and enabling more targeted and timely cross-selling of complementary products.
  • Automate manual back-office tasks: Digitizing boring, repetitive and error prone tasks can reduce cost and improve cycle times. One of our clients reaped major efficiencies by automating basic-level customer service (through enabling customer self-service) and the review and payment of expense reports.

Every sector can benefit from enabling digital technology. In fact, some of the necessary ingredients are already in place. Specifically, many firms already incorporate digital technologies like Big Data analytics, ERP systems, and cloud services. Unfortunately, these tools are often deployed selectively within a line of business or functional silos with little consideration paid to the bigger enterprise-wide impact, standards etc.

Nominate champions

Digital transformation can be the most difficult business shift many companies face; it is part technology adoption, part process redesign and part behavioural/cultural change. This transformation should be not undertaken without strong leadership at the C-suite and board levels; it is vital that these mission-critical initiatives have senior champions who possess an organization-wide and holistic customer view. Some firms have gone so far as to create the role of a Chief Digital Officers to lead digital efforts.

Understand the impact

The return on your digital investment can be compelling — and difficult to accurately estimate. Firms can not rely only on aggregated numbers like McKinsey’s; they need to undertake a wide-ranging business-case analysis that considers the full range of benefits including cost savings, improvements in customer satisfaction and higher cross-selling rates. The business impact should be measured through digital targets to evaluate progress and influence future investment and roll-out decisions.

Take an end-to-end view

Maximizing the value of digital requires a consideration of scope and scale that cuts across the firm. For example, automating sales activities will have important implications for inventory availability, product design and marketing channels. Managers also need a 360-degree view of organizational issues like available skills, cultural impact and change requirements.

In the above areas, we have found that companies need a detailed view of user needs and behaviour as well as formal and informal workflows. Digital transformation will often precipitate a need to refine processes, the nature of the service, and in some cases, the operating structure.

Carefully choose your opportunity

Leaders need to prioritize what to digitize. Trying to bite off more than you can chew may ruin the business case, quickly bog down implementation, and lead to conflict over scarce resources. On the other hand, having too narrow a focus may leave significant value on the table. Whatever the choice, managers must ensure the potential business value is compelling, the selected initiatives align to business priorities and they have the right resources and partners to execute. Leaders also have to accept that over time, some lines of business, activities or jobs will be displaced by digital technologies; these shifts — often sudden — can have important organizational ramifications.

Going digital is a journey. Hype may turn transformation into a sprint but in reality it should be seen as a marathon. Starting with a digital pilot is prudent for the technologically risk averse or inexperienced. In some cases like iTunes or Netflix, digitally transforming a product may call for a totally new business model. Managers will maximize digital’s value when they: select “low hanging fruit” opportunities, prudently invest based on the right risk/reward profile, get their workflows optimized and ensure the right resources and change methodologies are employed.

For more information on our services and work, please visit the Quanta Consulting Inc. web site.

5 Steps to Digital Transformation

Most companies want to better leverage digital technologies — social, mobile and cloud services — to deliver an enhanced customer experience, enable new business models and drive greater operating efficiencies.  They also dread falling behind their bolder, more agile competitors. Yet, most leaders are unclear as how better to use the technology they have or decide which new tools to adopt. How can these laggards prudently catch up?

It is well documented how transformational leaders like Starbucks, Nike, Cisco and Apple have employed digital enablement — organizationally and technologically — to generate new revenues, extend market leadership, and reduce cost by streamlining processes and practices.  Unfortunately, these firms are the exception not the rule.

MIT Sloan Management Review and Capgemini Consulting conducted a survey in 2013 of 1,559 executives and managers spread across a wide range of industries. The survey looked at the state of digital transformation, and the barriers and enablers that are impacting this journey.  To be clear, we are talking about embracing breakthroughWeb 3.0 technologies such as cloud computingcrowdsourcing3D printing andlocation-based analytics, not more common applications like e-commerce or server virtualization.

The study’s key conclusion is sobering but hopeful. Despite the promise (or hype) of a digitally enabled business, most companies have been tentative in fully adopting new technologies and supporting them with organizational changes.  Fortunately, the study also highlights some best practices that point a way forward to fully exploiting potential of digital technology. Some of the study’s key finding are:

  • There is a digital imperative. A convincing 78% of respondents said achieving digital transformation will become critical to their organizations within the next two years.
  • However, words do not match with reality.  Only 38% of respondents said digital transformation was a high priority on their CEOs’ agendas.
  • Awareness of the intent-action gap is a good first step. A strong 63% of the executives acknowledge the pace of technology change in their organization is too slow.
  • Firms that were considered digitally savvy typically outperformed companies that lagged in technological implementation.

There are worrisome but often benign causes for this lethargy.  The study and our research point to many factors, including:

Lack of urgency: Firms with no ‘burning platform,’ competing management priorities or who focus inordinately on short-term results will be less willing to put sufficient focus and resources behind digital initiatives.

Pessimistic culture: Many organizations are naturally risk averse, have management systems that don’t handle technology issues well or display a ‘not invented here’ mindset to technological adoption.

Low digital awareness among leaders: A digital divide exists in many companies between junior or middle managers who understand the potential of digital technology and those leaders who make strategic and financial decisions.

These barriers must be overcome. Entire industries (e.g., travel, music, retailing) have been disrupted by digital pure-plays and/or seen their margins shrink significantly.  Acknowledging the issue is no longer enough; organizations must get in the game.  Here are five best-practice recommendations we have made to a variety of clients:

Raise digital literacy. To begin with, all cross-functional leaders need to understand key digital trends, what their competition (current and emerging) is doing and what are some best practices from outside their industry.  Nike looked beyond the apparel industry to the wireless, controls and sensor industries when launching its Nike+ offering.

Focus the impact. Technology should not be adopted because it is cool and flashy. It must support the core mission and priorities of the firm — not create new ones.  When Starbucks made its digital transition, it added services that would enhance the customer experience (free wi-fi) and streamline operations (add digital payments to speed up the order/payment process).

Organize for success. Companies can take many steps to support transformation, including mandating digital representation on cross-functional teams, forming digital ‘centres of excellence’ and giving enterprise-level authority for digital investments. When media firm Gannett and Columbia University wanted to accelerate its adoption of digital technologies, it created a new chief digital officer position with a mandate to spur technological adoption and relentlessly evangelize the vision.

Re-tune practices. Make digital literacy part of key practices like recruiting, research and training.  Create and connect digital transformation metrics to reporting, incentives and the performance management system.  One of our clients in the IT sector requires their planning activities and templates to include a digital lens.

Walk, don’t run. Big bang technology adoption rarely works.  Pick an operational, service or marketing pain point and investigate how digital technology can help solve the problem or improve performance.  Pilot something.  If it works well, scale quickly.  If it doesn’t meet expectations, kill quickly, inculcate the lessons and move on to something else.

For more information on our services and work, please visit the Quanta Consulting Inc. web site.

Social media’s productivity boost

Most companies are using social media exclusively to drive marketing objectives such as building product awareness or highlighting new promotions.  A small number of dynamic organizations, however, have deployed social media as an instrument to improve employee productivity and engagement.   Research suggests that (at least for now) the biggest payoff from social media will come from higher corporate productivity in terms of better communications, enhance data management and improved collaboration.  As such, leaders should consider adding internal social media tools as part of their corporate social media plans. However, they need to be mindful of organizational challenges that can limit the payoff.

Social media has hit the big time.  According to comScore more than 1.5B consumers worldwide are registered on a social networking site.  Almost 20% of the time online is now spent on social network sites, triple the amount spent in 2008. Not surprisingly, marketers have been the first to exploit this growth by launching new advertising programs, setting up their own social sites and engaging in real-time dialogue with their consumers.  This initial consumer focus has produced crucial insights on how people interact with the technology as well as communicate and collaborate with each other.  Savvy managers are analyzing these learnings and the experiences of some early adopters to explore how their firms can leverage social media inside the organization.

When properly designed, social media applications can dramatically improve communications, knowledge management and collaboration within and across the organization and with external stakeholders. The McKinsey Global Institute estimates that in the packaged goods, consumer finance, advanced manufacturing and professional services sectors alone, new social technologies can produce between $900B to $1.3T in value creation.  Two-thirds of this benefit would come from improving collaboration and information flows between knowledge workers in the product development, marketing, customer support, sales and operations departments and across the organization.  One third of the incremental value is created from using social applications within these functions.

Social media is a powerful communication and collaboration enabler.  For one thing, most employees are already comfortably using public platforms and storing information there.  Furthermore, these tools have a unique ability to catalyze rich and varied interactions as well as enable easy data searching and archiving.  Finally, social platforms are not hamstrung by the technical, physical or behavioral limitations of existing email and knowledge management systems.

New research suggests that middle managers, in particular, will get a performance boost from using social technologies.  Middle managers are important, expensive and skilled individuals who spend an inordinate amount of their time communicating in email, looking for data and attending meetings.   Improving their effectiveness can significantly enhance organizational productivity, and decision-making. McKinsey estimates that middle managers that use social technologies in their everyday work could save 20-25% of their time and effort – and solve real business problems.  In our experience, social media-enabling a firm can also unlock the latent creativity and problem solving skills of newly empowered workers as well as serve as a powerful tool for reinforcing corporate values and strategies.

We witnessed first hand how social media can improve a company’s performance. Our firm helped a major IT services provider develop a private-platform social media strategy to support customer service in their financial services business.  The platform expedited the dissemination of time-sensitive information (e.g., upgrades, announcements) and reduced the time to respond to end user queries. Moreover, the firm unlocked the problem solving talents of hitherto overlooked employee groups.  Productivity enhancements like these led to higher customer satisfaction scores and improved service team effectiveness and efficiency.  Other companies such as Cisco and Dell are benefitting from internally focused social platforms.

Capturing social media’s value creation is more than choosing the right technology – although that is vital. The bigger challenge is on the organizational side.  For example, managers need to consider how new social platforms will fit with their existing (and implicit) workflows.  In many cases, these will have to be tweaked or new processes will have to be created.  Furthermore, the leadership should seek to maximize employee participation across the enterprise. This will depend on the leadership commitment, the firm’s culture (i.e. is there an environment of sharing and trust?) and the employee’s inclination to embrace change.  To improve the odds of successful change, managers should think about how their on and offline practices will co-exist, and how they can leverage proven change management methodologies like Gamification.

For more information on our goods and services, please visit the Quanta Consulting Inc. web site.

Organizing for cloud computing

Many organizations we work with are diving head first into the latest IT game changer, cloud computing.  While a comprehensive technical and financial analysis is usually undertaken, few companies thoroughly consider the organizational implications of this strategic move. They do this at their own peril.  We have seen cloud computing implementations go astray when the wrong structures, processes and practices compromised the right technical solution.  Managers would be wise to consider whether their organizations are cloud-supportive before re-architecting their infrastructures.

In a traditional IT model, technicians, hardware and software are tied to specific geographies, departments and business units.  In most cases, this model fails to maximize operational flexibility and IT asset utilization.  A CC architecture, on the other hand, centralizes and virtualizes IT resources, making them available to all users when needed as needed. The result is greater operational agility, lower costs and higher IT scalability.  This fundamental change in the way IT is treated has major implications on a firm’s organizational system and culture.  For example, who controls virtualized IT resources and priorities in an ‘on demand’ environment? How do companies execute projects when assets and capabilities are decoupled from a physical location? And, what work practices are better suited for a more transactional and fluid CC environment? 

If they are to maximize the benefits of CC, business leaders must rethink how their enterprises are organized and run. Based on our consulting experience, we know the following areas are a good place to start:

Focus on tasks, not structure

CC’s rapid IT provisioning enables companies to be more flexible and agile, for example, in deploying new applications faster or responding quicker to market needs. However, many firms have rigid structures and processes that were developed in the era of static IT resourcing.  This traditional model is too limiting to effectively exploit the benefits of CC.  To be cloud-ready, managers should experiment with other organizational approaches that are more synergistic with the way CC works.   For example, an adaptive, SWOT-team structure and working style can more quickly respond to new priorities and deploy the resources and expertise needed to deliver on the business need.  The film industry is a good example of this kind of adaptive system; a wide variety of people and capabilities come together quickly at different points in the production process to execute on a creative concept and plan.  At completion, the people and resources go back to a central business unit or are dispersed onto other projects. 

Form follows function

In a traditional IT model, resources are usually structurally (if not mentally) “siloed” and linked to specific functions via non-standard workflows (i.e. processes)  Putting IT resources in the cloud decouples them from the constraints of a physical location, allowing them to be managed more centrally and deployed virtually.  As such, CC can help bring about the formation of a true Shared Service Organization, a structure that delivers key business benefits. For example, a capable SSO is essential to enabling the adaptive business system mentioned above – assuming good workflows are in place. However, Gary Tyreman, CEO of Univa, a leading supplier of Cloud Computing solutions, cautions that “to realize value, an organization must integrate its cloud-powered IT services into existing workflows.  Where those workflows are broken or non-existent, they need to be fixed and defined.”  Secondly, a SSO brings significant value including lower administrative costs, increased management control & standardization, and the possibility for greater organizational learning.  Finally, having a SSO allows IT managers to focus more on pushing the business forward as opposed to hoarding resources and building fiefdoms.

Collaboration breaks down barriers

The common business environment – hierarchical roles, non-standard processes, and department-based metrics – encourages employee practices that are ill-suited to the dynamic nature of CC. To best leverage the cloud’s capabilities, employees need to change how they work.  To begin with, the leadership must foster increased collaboration and alignment within the firm as well as with external vendors.  Examples of the changes required, include:  better aligning IT teams and vendors to overall business objectives (versus more parochial departmental goals); encouraging end-to-end project collaboration (versus point-in-process support); and placing greater importance on team and individual skills enhancement (to drive best practice adoption).  To make these changes stick, leaders will first need to get two things right in their management system.  One, project accountability should live with the business sponsor. Two, responsibility and authority must reside with the SSO leadership.

According to Tyreman, “For most companies, moving to the cloud is more an organizational challenge than a technical problem.”  Fully tapping CC’s potential will require enterprises to recast their structures, processes and management systems where appropriate. Though this may not be easy, it need not be scary. Companies that are open-minded, practical, and flexible will create the right organizational environment to fully leverage the Cloud.

For more information on our services and work, please visit the Quanta Consulting Inc. web site.

Gamification: games businesses play

Game playing is moving out of the animated world of video games and into mainstream business. Gamification – the use of games to address business problems or opportunities – is an innovative form of consumer and employee engagement  that translates online game design elements into non-game settings.  A recent phenomena, gamification is being used by innovative organizations to: 1) increase consumer participation with a brand; 2) drive faster adoption of a new application or tool and;  3) foster process alignment. The premise is that games can help change and sustain new behaviours among your target audience, thereby generating real business value.   Games are particularly helpful with tasks people find a hassle, boring or psychologically challenging, such as following routines, shopping, completing surveys or reading websites.

Gamification improves engagement by leveraging a person’s psychological nature to play games, interact with others, and seek extrinsic rewards.  The more entertaining, competitive and rewarding the game is, the more likely people will participate in a desired behaviour and for longer periods of time.  Numerous studies have shown that extrinsic motivators (e.g., leader boards, badges  and virtual currencies) are effective drivers of participation, at least in the short term.  To be fair, it has yet to be proven whether extrinsic motivators (versus intrinsic motivators like personal will and desire) are sufficient to trigger long term behavioural change.

Game playing is common to every demographic and socio-economic group as it addresses fundamental human desires for things like rewards, status, achievement, competition, self expression, and altruism. Not surprisingly, Gamification can produce benefits across the  entire organization.  Marketers look to games to increase consumer participation with their brand or social media presence;  players are more likely to return to a site and engage in desirous online behaviour like completing tasks, visiting different web pages or shopping.  Other functional groups can use games as a means to catalyze employee action in areas like improving project execution, completing corporate education programs and maintaining employee health regimes

Gamification in action

Knowledge@Wharton, a publication of Wharton Business School, has noted some well-known examples of innovative gamification programs:

A Nike program, Nike Plus, allows runners to keep track of their runs using a small accelerometer in their sneakers.  The runner can plug the device into their computer and track results against their friends via leader boards.

The USA cable network uses a rewards system to fuel an ardent fan base for some of their shows like “Psych.”   Viewers on the channel’s special “Club Psych” website are awarded points for their active engagement with the site.

In an effort to cut its high fuel expenses, software firm SAP uses point-based games to incentivize employees to carpool.

Given the newness of gamification strategies and the inevitable customization needed for each company, published best practices and ROI numbers are not always accessible.  However, we have discovered some learnings that would benefit organizations looking to dip their toe into game-playing:

Great games are more than the sum of their parts

Just because something has an interesting game element doesn’t make it a good, complete game. Truly successful games are designed around a business need, are compelling to play and really focus on something fundamental that people genuinely want to do. Because game design is often based on widely held but sometimes faulty assumptions – for example, money motivates people the most –  managers must be careful not to introduce bias.

Start small and test

Like any other tool or methodology, games can be misused and manipulated (i.e. people cheat), producing unintended consequences or results.  The best approach is to do little experiments,  test different variables and measure the right metrics, both quantitatively and qualitatively.

Get the right business owners

For optimal strategic focus and game design, games should be “owned” by the business unit or department that has the pressing business issue.  Regardless of the of the game being run, it is well advised in the planning stage to engage a team or outside firm with solid functional expertise, experience in human psychology,  and expert game design skills.

For more information on our services and work, please visit the Quanta Consulting Inc. web site.