Pretzel Logic – Social and Collaborative Business

This week I have the privilege of keynoting the Social Business Forum in Milan once again, along with esteemed industry colleagues such as R “Ray” Wang, Esteban Kolsky, Sandy Carter, Michael Brito and others.

The concept of networked enterprises is something that’s top of mind for me these days as we chart the next chapter of social collaboration – not as a side dish or a condiment but as a main ingredient in the world of work and by extension, in the new enterprise technology stack.

I wrote about this recently on the newly minted Diginomica site, specifically about the difference between “community” and real networks. Big networks to embrace high velocity high value opportunities such as customer driven innovation and service but as important, and a topic that gets left out, tiny operational efficiency opportunities that can bring about huge business benefit by wrapping your network around it. Some examples of real network benefits such as Ariba, Yelp, Numerous learning networks, even supply chain. Here is the full post.

The confluence of data, business process, content and the wrapping of expert networks is something we’re only now starting to understand. And it won’t come from just extracting data from applications or integrating social into process systems. Where it makes sense to wrap our business networks around our transactions or structured work, we will. Where it makes sense to re-think entire applications stacks and how we fundamentally operate in a network first design, that will happen as well. So far we’ve tried to emulate Facebook in the enterprise and the results have been less that optimal. As the power of contextual networks grow, they become subcutaneous and the opportunity to then put transactive capabilities on these networks offers entirely new opportunities.

My current favorite example of this? A serious pain point in logistics where networked fleet management for truck drivers of a logistics provider can identify alternate traffic routes to avoid traffic delays and reduce whopping average costs of $79,000 in fuel costs, per truck, per annum. Another one we’ve seen with customers: Expert networks of nurses looking to train each other not on standard policy stuff but tiny tips and tricks in the operating room that reduce latency and risk. These are contextual and very situational and where  the “what’s in it for me” is crystal clear to all participants.

Such networks form from one acute business pain point but once its formed, a slew of new transactional data and operational opportunities surface that can be dropped into these networks. The difference though is that business context and the fundamental raison d’être for these networks are never in doubt.

The first iteration of cloud based applications has been largely focused on copy-pasting on-premise functionality with well understood benefits that comes from cloud based delivery and consumption. But network-first business models, coupled with highly extensible cloud platforms will change how we think about working, how we onboard, train and enable employees and partners, how we serve customers and how we get more out of our supplier relationships.

This is a topic I look forward to discussing with peers in the European community, in particular. Why? Because this audience always keeps you honest. As I said in a previous post about speaking here in Europe:

I’m generalizing here, but customers in North America are often more pre-disposed to experimenting with new technology. The situation in Europe has always been different and European customers have a way of rapidly re-calibrating you down to reality when you start playing buzzword-bingo by using terms such as “social business”. These don’t mean much to them. European companies are staring a tenacious recession, unemployment, macro re-skilling requirements and industry-specific challenges and opportunities. Regardless of the promise of any new shiny technology innovation, they always force you to winnow down the value of new technology to 2-3 simple benefits that apply directly to established hardships and opportunities. And they glaze over solutions to problems they don’t have.

The conversations here are always grounded in tangible results to established problems and they make me a much smarter person with every subsequent visit.

Looking forward to seeing many colleagues in Milan.

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2013 SAPPHIRE NOW / ASUG , SAPs flagship user conference was a big one for me and our Enterprise Social Software team at SAP. Exactly a year ago at this very event we unveiled SAPs strategy for social and collaborative software. In Madrid at the European version of this event later in the Fall, we showed real product. This year we showed more integrated social collaboration with business applications, analytics and as a service in the SAP HANA Cloud Platform, and shared some statistics on our business. Here’s a nice quote about the product from IDC’s Mike Fauscette’s blog post about the event:

SAP is making good progress on the cloud enterprise social network (ESN) front with Jam, which grew over 800% year over year. The key long term to ESN, I believe is to get them embedded inside all of the enterprise apps so that social collaboration becomes an integrated part of everyone’s work flow. SAP is one of the vendors that has real opportunity to do that across the enterprise.

(Thank you, Mike.)

A businesses ability to bring its expert networks of employees, customers and partners to collaborate around business processes, around real time data and analytics and content is what will drive not just the future of social software but how enterprise software will be built. I spoke to John Furrier of Silicon Angle about this at the event, here.

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Nmachi Jidenma writes about the undue focus we put on the competition. This is written with individuals in mind but I think it matters to emerging software categories as well. My favorite lines:

“It only makes sense that competing with others distracts from the distinctiveness that makes our art special. By comparing ourselves with others, we lose the magic that developing our core art affords the world. Competition with others in a sense makes us ordinary. It encourages imitation and, if we are not careful, makes us lose our essence. How boring.”

and

“Perhaps the best illustration of the magic that competing with oneself can bring to our art is Steve Jobs. Steve Jobs’ maniacal obsession with his art was apparent to all in the careful attention to detail observed in most Apple products. This was clearly born out of his internal vision, which would not have seen the light of day if he did not stay committed to tapping into his inner creativity. We owe it to the world to bring our originality and insights to the work that we do.”

When it comes to emerging or low maturity categories,obsessing focusing too much on competitors can amount to at best, much ado about nothing and at worst, be down right dangerous. Not to mention really expensive when we can afford but a few marketing arrows. The reality is that in early stages of market maturity a good chunk of your competitors product and market strategy is experimental anyway. And the kicker is that even they don’t know which 50% will really work. And too often all it does is just distract product teams by putting a read view mirror in front of them and sucking every ounce of ingenuity out of their thinking about what can be. The wildly successful Tesla S, for instance, has redefined what a car should be and can be with a software-first ethos, yet with an appreciation for the basics. Can you imagine if Tesla had merely copied all the elements of the traditional car, save for the battery?

Software marketing has changed forever with the advent of cloud base delivery. The speed at which you need to move lets you define or re-define categories like never before. The very definition of what massive categories such as core HR, in-memory computing platforms, Collaboration, even CRM, is up for grabs, right now.

Sure, you need to have an understanding of where the competition is going, inform your play books and set your land mines. But too much focus on the competition just means you end up being reactive to a wobbly market definition instead of thinking about how to lift and shift the goal post.

About the only thing that is in fact constant is the ingenuity of your products your products innate understanding of the customers need and how well you communicate this.

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April marks my one-year anniversary at SAP.

It’s been an incredible ride to say the least. I’m a lucky guy – I came to SAP to help build out its products and go-to-market in the social and collaborative software category. But what I really I got was a chance to get in on the ground floor of a unique opportunity to participate in shaping SAPs place in the larger software category with SAP Cloud.

Our mantra has always been clear that social is not a destination but a critical enabler to established performance KPIs and that’s what driven our product strategy and our value proposition to customers. We started not with social but with the state of our customers businesses – both challenges and opportunities to drive revenue, lower cost and mitigate risk. And then identified the needed dance between data, business process, content and people. And executed like mad against that strategy culminating in a re-launch in last year.

Thanks to the efforts of an incredible cross-functional team we doubled our growth in 2012. The sheer tenacity and close partnership between SAPs amazing cloud and on premise application development teams has been something to write home about. I was warned numerous times about how impractical cross-functional collaboration can be. But the lines between transactions, process and collaboration have been blurred forever and the customer demands a default process + social experience, now. And the teams made it happen.

I’ve always been straight forward with respect to my opinion about the various strands of “social business”, here. But the role of social and collaborative constructs to truly accelerate performance in the enterprise has never been more critical. I’ve covered this on this blog for 4 years now and in my past roles but after working closely with customers and with numerous internal industry and products groups at SAP, you truly get an appreciation for the role that systems of record play every day but also the gaps that remain in day to day work for your customers, your employees and your partners.

The power of connected networks, the availability of business and process context in the cloud or on premise or both is extremely powerful. This is why I was attracted to a company rooted in business process. As an industry, we’re just starting to understand how to leverage this. SAP has given me the opportunity to go really deep on this subject – understanding how for instance, thousands of contingent retail employees, or floor staff at casinos need to be on boarded and enabled at scale, or the costs of ramping up sales teams, the power of customer networks thanks to SAP SCN community efforts, or how the white spaces in tight fraud management processes or in transportation and logistics can expose unmitigated risk. And against that backdrop, where social collaboration can move the needle and where it can’t and with cloud economics in mind. I could go on and on.

I’m really privileged to be able to do what I do and especially at a time when the re-wiring of enterprise software to focus on getting work done (as opposed to a list of features) is only now underway.

A big thanks to our team and the teams we work with across SAP, every day.

Phase 1: Check.

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With respect to why “Social Business” is a natural fit for the world of work, I said on Twitter:

@sameerpatel: Often heard #socbiz argument: “humans are social by nature”. Then why is it that #socbiz s/w adoption has been so hard historically?

Contradicting this is another popular statement about Social Business: “Its not about the technology, its about the people and culture”.

So which is it? The people or the tech?

I got some fabulous commentary in response to my tweet:

Bertrand Duperrin does what he does best (and why we became good friends instantly, years ago) by cutting to the chase on under currents:

@SameerPatel not sure that “human nature” is only made of good things . Greed, jealousy, anger are also part of it.

James Dellow, a seasoned collaboration practitioner brings up politics

@bduperrin @SameerPatel organisational politics too. “Results may vary”

Liz Coleman responds with the habitual preferences or the well known theory that technology needs to be 10x better to get users to change habits:

@SameerPatel interesting point. I would argue humans’ resistance to change, esp in regards to new technology (for vast maj.), could explain

Mike Boysen, one of the funniest and super smart CRM consultant says the fault really lies with organizational designs.

@SameerPatel I believe the design of the org is the driver, not the tools. Unfortunately, tools can’t do it alone yet. Tools should enable.

They are all right. But just imagine if you were an executive subsuming these arguments. You can see why you might pop an aspirin and say “to heck with it, I’m just going back to my old ways of work. The way we work today may well be woefully inefficient, but I know the devil I’m dealing with.”

Bertrand is right. Humans are some combination of social, greedy, jealous, angry and a 100 other things. And success against that backdrop is going to always be a function the people you hire, the culture you embody and the technology you pick to execute. The reality is that our historical definition of “social business” often requires you to go against energy that flows inside organizations, thereby requiring massive behavioral change. Social Networking is better than Email. Sharing is better than hoarding. And on and on. And Mike, Liz, Bertrand and James are well justified in their push back arguments.

In the face of all these extremely valid and conflicting arguments, one thing remains constant: Your best employees are always working towards their soft and hard incentives. Note: I didn’t say Goals. That only happens if your goals and incentives are well aligned and thats a different show. But ways to drive efficiency and execution performance will come from a) individual self improvement and b) working with others to improve output, if thats warranted for the job at hand. If the underlying technology forces you to do more of a) or b) than is needed, your carefully thought out plan to improve social collaboration is dead on arrival.

In reality, it is about both: human nature and the right underlying technology. But most important, its about stepping out of the people vs tech discussion and honestly identifying where social and collaboration concepts can in fact move the needle in terms of incentive alignment, and frankly, where it can’t.

Social Business has no doubt seen success in pockets. But mostly, Social Business to date is like a Salmon swimming upstream. We all know how that movie ends. It’s time to see how you can leverage social computing to enable the organization to swim in the direction of the incentive currents and help them collaborate more effectively where its apparently needed. And identify which technology puts flippers on your employees feet.

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Last week I had the privilege of keynoting CeBIT in Hanover. The theme was “Shareconomy“. From the CeBIT website:

“Shareconomy” describes the societal shift from owning to sharing. According to Pörschmann, this is evident in several dimensions: “First, Shareconomy is profoundly influencing enterprise processes, because social media tools will become more and more popular. Second, the Internet is the place for teamwork, both in and outside the company. Partners, consultants, suppliers and customers will be more closely integrated as part of a networked process. The borders separating companies and organizations will become ever more transparent. Therefore, employees and managers must rethink and be prepared to share know-how, contacts and assets.”

My presentation was on the commercial value and benefit of the Shareconomy for the Enterprise. And if you have read this blog before, you know that I took the idea of “Facebooking of the global economy” to task somewhat. -). But in all seriousness, the theme was fantastic and the questions after were very engaging.

When I find a link to all of the keynote presentations I will update it here but I highly recommend giving them a quick look. Really excellent content from a great group of industry doers and thinkers.

Here are my slides on SlideShare:

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Wrote a post about what today’s customer expects in terms of “relationships” on SAP’s Customer Edge Blog. Here is a snippet:

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Transactional CRM, the system of record technology that lets you manage a sales cycle, a customer service request and marketing activity, is critical to make official records of who did what.

But here’s what striking to me: Traditional CRM, which stands for customer relationship management is a transactional and operational technology that never really touched the customer.

That may have been OK in the past, but today’s customer who is extremely well connected and networked thanks to the social web has radically different expectations of the companies that they do business with.  Beyond socializing, the social web is where we seek to research and engage with both, like-minded buyers and with purveyors with whom we want to do business. In a 2011 IBM study on Social CRM⁽¹⁾, 42% of those polled use the social web to share opinions about products they use, 39% use it to access product reviews, 23% said they outright rely on the “social web to interact with brands”.  Yet another supporting point to CRM pundit Paul Greenberg’s assertion that “the customer is in control of the conversation.”

Let’s dispel three misconceptions about the social web first:

1. This isn’t about bleeding edge industries anymore. A 2009 business.com study⁽²⁾ showed Real Estate and Construction, Healthcare, Media and Entertainment as top contenders for social media.
2. Access to social and traditional web content is now equalized. Even if you believe that a majority of your customers don’t use social media, traditional web properties such as Google and LinkedIn index even the few conversations that might exist and make positive or negative opinions about our wares visible to everyone.
3. No, the social web isn’t just about Twitter and Facebook where you may argue that your prospects don’t really hang out. Amazon Reviews (Retail), Trip Advisor (Travel), FlyerTalk (Airlines), Yelp (Restaurants), AngiesList (Services) and literally a hundred other topical forums are all part of the social web or what Mike Fauscettecharacterized as “systems of relationships” that are dis-intermediating your controlled marketing every single day.

Five Design Considerations

So how do we prepare for this changing interaction dynamic? The needs of this new breed of customers centers on the following 5 design considerations:

I’ve broken down each of these Design Considerations on the Customer Edge Blog, here.

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