ROI For UC, Social Media Hard To Find

10 Smart Enterprise Uses For Twitter

Enterprises that place a high value on innovation are increasingly embracing social media, wider collaboration, and unified communications in order to run their business. But the return on such investments is harder to pin down than it would be for buying a bunch of new servers, a new ordering system, or locating a plant in one place over another. Still, there are measures of success that proponents of better collaboration and UC point to make their case for the investment.

Last week, at the Enterprise 2.0 conference in Santa Clara, Calif., a UBM TechWeb event, Tom Kelly, the CEO of Moxie Software, a provider of what it calls "enterprise social software," said that while bringing social media into the enterprise doesn't produce an ROI in dollars and cents, it still has merit.

"What's the ROI of communications? What's the ROI for engagement? What's the ROI for driving innovation?" Kelly asked.

In an interview after his presentation, Kelly cited one Moxie customer, TEVA Pharmaceuticals, which said it had acheived a 40% improvement in the efficiency of its supply chain system after it started using enterprise social software. In other instances, social media tools can lead to quicker time to market for new products and services than without it, he said.

[ Is Microsoft's collaboration portal a real social network? Read Does SharePoint Have Future As A Social Platform?. ]

Companies use social media platforms tailored to the enterprise to connect with employees, customers, partners, and others to engage in the same communications and collaboration as individuals do on social network sites such as Facebook or Twitter.

It has the same beneficial effects, said Jonathan Schwartz, the former CEO of Sun Microsystems and the newest member of Moxie's board, who appeared on stage with Kelly at the conference.

"Eight hundred million people are using Facebook. That means a whole lot of your customers, employees, shareholders, and partners are already there," said Schwartz.

Still, some resistance to using social media remains in enterprises, although resistance is fading. Kelly lamented to his audience that at an earlier technology conference, a CIO of one financial services firm voiced skepticism: "If we deployed an internal collaboration system, the next thing you know, the employees will be asking to put beer in the refrigerator," he quoted the executive as saying.

Other concerns have arisen over comments that employees may make online that could embarrass the company or run afoul of regulations like those of the Securities and Exchange Commission. Schwartz, who was one of the first high-profile CEOs to blog when he ran Sun, said his blog posts were never edited by others, except for posts related to Sun's quarterly earnings reports, which were vetted by legal for SEC compliance. Also, some social media communications can be limited to stay within the corporate firewall.

At its best, using social media within the enterprise improves collaboration and group problem solving, said Kelly. TEVA, for instance, uses social media for what it calls "spontaneous association." When several people are communicating, someone will inevitably have an answer to another colleagues question and can provide the answer more quickly than by conventional means such as memos or emails.

And as to whether enterprise social media will get a company into trouble if something gets out, Kelly said that ultimately, the company image projected on social media will reflect its corporate culture overall--good or bad, Kelly said.

If a company is dysfunctional and employees are unhappy or feel they aren't appreciated, that will come out in the social communications, he said. On the other hand, if they are happy, productive, and engaged in meaningful work, that will also come out. Managers may be pleasantly surprised that some employees are grateful that someone else in the organization values their input.

"People who never get asked were just waiting for that opportunity to say 'Why not this way, why not that way?'" Kelly said. "They get the chance to express who they are."

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