Re-Imagining the Social Business business

Went to what in my opinion became a fairly seminal event yesterday morning - the launch of the Microsoft Business Re-imagined session (Twitter link here). I think the title caught the zeitgeist square on - the issue is no longer about "what is Social Business, and what could it do" but is moving on to "How would one re-structure/transform a business to best use the techniques, and what are the threats of not doing so". Abigail Harrison has done an excellent post covering the whole event, so I won't repeat what she wrote, but here are my main observations and take-aways.

Firstly, I think Social Business is now starting the necessary transition from expectation to delivery. By that I mean:

1. For the last few years, Social Business has been "sold" on its transformative potential. Most people can see that the demonstrated power of social connectivity and by and large would agree with the potential, and history also tells us major shifts in communication drive major shifts in commercial, economic, social, physical and political structures (the related current creative destruction of the retail High Street is no accident).

2. All new movements have a conceptual stage, and many dreams are typically heaped onto the movement at this stage, not all of which can be fulfilled - the "Peak of unrealistic expectations" as Gartner's hype curve has it (and far be it for me to suggest these dreams are encouraged as part of the general hype bubble inflation )

3. But there comes a time, nicely prompted here by the title of "Re-Imagining" business, where to be credible ongoing, the rubber and the road must meet, the beef must be put in the sandwich, etc etc - i.e what is actually possible, now, becomes clear. This "art of the possible" is initially built up by pilots and case studies, then a set of general design principles emerges

4. This is necessary because, ultimately, businesses will change if - and only if - there is a "new model" that allows them to calculate, predictably, how to re-imagine themselves in the new mode, and why they will do better than they are doing now. The Gartner Hype model is essentially built around this dynamic of a "plateau of unrealistic expectation" followed by a collapse into a "slough of depond" if the new idea can't transition into real business benefits.

Secondly, typical of this "phase change" time, pointers to the Social Business future is around us - but unevenly distributed:

1. An event I went to on Thursday (see here), plus our own work over the last 2 years especially*, shows us that the hard data analysis is happening already, and in spades. Also, talking to some of the participants at yesterday's session made it clear that huge strides are being made in re-structuring operations to use Social Business, in many companies, but its piecemeal, consisting of pilots and small scale test operations in larger businesses.

2. There has been a lot of thinking over the last decade or so, nearing maturity now, on how "smart work" methods can take advantage of these techniologies.

3. There are pilots and case studies showing impact, but as yet its not clear exactly what works, so there will be massive experimentation for a while yet (as is always teh case with new innovations) until the dominant models emerge. Predictably, most innovation is still by smaller companies who have more to gain and less to lose, the difficulties of this path is the wheels may fall off when things need to scale

In my view, the buzz at yesterday's event was palpable, with so many people looking at this still emergent field from so many different angles, I haven't seen a room like that for some years - I think the timing of the session has hit the turning point, but Kudos to the organisers, panel and participants for creating the vibe, and I think there is a huge potential for this to really become something groundbreaking.

But, after all the excitement, may I now be boring and point out that when a business re-imagines itself and then prepares for transformation, and starts to look at the actual "why" and "how" of restructuring, when push comes to shove it always has to answer a very simple set of questions (usually in the form of a business model and case), about how this new thing will improve one or more of these basic business drivers:

Increase Revenue
- Sales volume
- Value per sale

Reduce Operating Cost
- Operating cost per customer
- Customer retention

Reduce Capital Expenditure
- Increase life of existing Capital equipment
- Reduce future Capital expenditure

And at this point, belief and good will just don't cut it.

So what is required now is for many of the fascinating new concepts that have emerged, like Return on Engagement and Interaction, the Intention and Connectivity economies, Collaborative co-working, deep customer connection, etc etc - to resolve themselves into what actually will work, and what won't. This means predictable methods, metrics and procedures that demonstrably impact those above 3 axes for companies to actually make more money than otherwise. Now to be sure, many Social Business techniques are more about second order impacts - raising barriers to competition, undercutting the capability of incumbents, increasing the net long term value of the customer, better product development, but the links to basic value creation have to be understood.

This now - in my opinion - is the emerging challenge to re-imagine business going forward. But if the first session was anything to go by, this could be a very interesting journey....

(*Details available on request )