The Brooding Savage

Web 2.0 is on the mind of the business media this week.  Yesterday, BusinessWeek re-published a long article on the importance of Blogs for business.  The day before, the Wall Street Journal ran a piece on the power of Social Networks for corporate PR efforts.  

In each case, the motif was the same – common Internet tools can be effectively purposed to support critical business initiatives.  BusinessWeek discussed the ubiquity of blogs, and their use in corporate environs.

The WSJ piece included an interview with Jerry Sheer, CEO of Sparta Social Networks, which builds social networks for big companies.  The article discusses the power of Social Networks to help customer service and communications efforts.

At one point Sheer says having a Social Network will be as ubiquitous as having a website for major businesses.  “Social networks have become the Web site of this decade. Back in the '90s if you didn't have a Web site you were irrelevant; the same was true with having an e-commerce site in 2001. That is where social networks are right now.”  I suppose that depends on how you define a Social Network.  

The topic of  Web 2.0 products inside the corporations is too large for one article.  So today I’m reviewing the business uses of Social Networks.  We’ll explore more about various other 2.0 technologies later, including Wikis and blogs.   For now, there are 4 business-related strategies for Social Networks.

1.  Connecting Individuals with Individuals

LinkedIn is the classic social networking brand.  The site helps professionals stay in touch with colleagues, find jobs, and build business relationships.  The site leverages a user’s “social graph” in the same way Facebook or MySpace does.  Users list their professional contacts on the site; those individuals also list their own contacts, and so on.  

By exploring the network, LinkedIn can provide direct or indirect connections between members.  Colleague A, has a friend at company Y, who knows the current VP of Z.  LinkedIn then arranges introductions through the connected contacts.  Add excellent search tools, and you can find a personal connection within almost any company in the Western world.

2.  Connecting Companies with Companies

Businesses such as Visible Path, Contact Networks or Spoke Software also help professionals build network connections. But unlike LinkedIn, they provide their services at the corporate level.   Instead of individuals manually inviting all their contacts to join, enterprise-level software mines a company’s email and IM data to automatically find existing professional relationships.  

Users don't create home pages or profiles, instead the software keeps tabs on whom employees communicate with, ranking the strengths of those relationships based on how often people communicate.  Then the software helps businesses find contacts by finding likely connections from within each organization.  

Theoretically, a connection from one sales department to another could include several people, each of whom as a history of communicating with someone closer to the desired target.  The greatest value is clearly sales departments, marketing teams, or HR recruitment.  Some of these solutions also add information available through services like Dun & Bradstreet and Hoovers.

3.  Connecting Companies with Themselves

Rather than exploring external professional connections, various services use Social Networking to enable internal groups.  The benefit is supposedly greater flow of knowledge and information, the fostering of personal and working relationships, and the identification of talent (both within and outside of the company).

Large companies often suffer from a very distributed pool of talent.  Finding just the right person with just the right expertise can quicken development projects.  Social Networks inside an organization facilitate this… they can organize people around shared skills and technical expertise – even when that expertise is not part of their daily job description.  

Networks can also organize around shared attributes… women, new hires, alumni,, etc.  In this sense, the network can be a way to cut new paths of communication through highly rigid organizations.  One vendor of social network solutions, SelectMinds points out that 25% of workers have left a job at some time because they didn’t feel “connected” or part of the company culture. By helping forge personal relationships within the company, social networks can help in the retention of talent.

4. Connecting Companies with Consumers:

Companies that want to engage and learn from their customers can use Social Networks as a way of building communities around their brands.  Popular consumer brands have very developed communities online… including Google, Apple, and others.  These sites are great resources for the consumers, looking for reviews and technical expertise.  But they’re also great resources for the companies themselves.  They get early insights into product bugs, marketing challenges, and general PR issues.

In the case of Apple and Google, many of these communities grew organically, probably because users identify so strongly with these brands.  The qualities of the brand are so strong and positive, that users hope to transfer those qualities to themselves by being part of the community.  For example Apple has always been the innovative and technical superior corporate underdog, battling against entrenched Microsoft.  Google enthusiasts see themselves as the technically savvy corporate wunderkind.  

Corporations can leverage the power of a consumer-focused social network themselves, gain the same advantages, and maintain control over the experience and conversation.  Network members are free to gripe about the company, but as a member of the network the company has the ability to frame responses, address concerns directly, and be seen as an active participant in the business-consumer relationship.