When online communities go to work

There are now in fact workable ways for companies to engage and collaborate with large groups of people that greatly outnumber their workers. While debate still occurs about whether consumer social networking is an effective model for how we should run our organizations in the future, one under-appreciated online phenomenon has been quietly and steadily remaking the very notion of business itself.

People have been joining online communities by the millions for years now for a variety reasons, including both business and pleasure. These increasingly massive and mainstream communities focus on virtually every subject imaginable including news (Slashdot & Digg), open source software (Sourceforge), photography (Flickr), enterprise software (SAP), business innovation (Innocentive), travel (TripAdvisor), retail products (IKEAFans, Best Buy Community), consumer electronics support (Fixya), Web design (Crowdspring), charity (Feed A Child With A Click), and countless others.

As an indicator of size, the charity in the previous list is one of the largest groups on Facebook, with nearly 6 million members. While consumer communities tend to be much larger than business-focused communities, some of the latter are nevertheless becoming quite large as well, such as SAP’s 1.7+ million strong online community. Organizations are increasingly making larger industry plays using the community model, as we can see with the increase in investment into community-based talent management by Taleo just today for example.

All of these communities are focused on some kind of common objective: Attracting like-minded people highly interested and engaged in what they do. It doesn’t take long before the question that is being raised more and more often in the business world is asked, namely “how can we enlist such a community for our needs?” Naturally, the motivations, incentives, and rewards for creating a successful community based on business objectives is usually very different from a pure-play consumer community. Yet, the tools, techniques, and concepts between the two remain largely the same.

Alongside this phenomenon and running almost parallel is a very closely related topic. This is the trend of companies looking at using community approaches internally, where the discussion of Enterprise 2.0 is currently the focus. Intriguingly, as you can see above, all of these community trends are actually part of the overall emergence of social computing as a driving force on the Web and increasingly in business.

As we see a growing set of examples of successful online communities in the enterprise space (both internally and externally), the broad outlines are emerging of what is turning into a vital new channel for innovation, business agility, customer relationships, and productive output for most organizations: Online communities as one of the most potent new ways to achieve business objectives, both in terms of cost and quality. As I’ve explored in detail previously, if you create the proper environment that encourages it, people on the network will help you think of it, design it, build it, test it, and support it, whatever “it” is.

It’s a fundamental change in the way we look at how the workplace functions and it increasingly appears that social tools will usher this change in for many organizations. That’s not to say there aren’t still plenty of skeptics, yet the growing evidence, including many of the better commercial examples such as Crowdcast or LG’s community-based phone design effort, speaks for itself.

Online communities: What’s really new?

Online communities themselves are actually a bit long in the tooth, having been around since computer networks first originated in the 1970s. Since then they have been reinvented in each successive medium including bulletin board systems, news groups, dedicated Web sites, Facebook groups, and to whatever comes next. On the surface, they can seem unruly and unfocused, yet clearly thrive with activity and purpose. Unfortunately, it’s sometimes far from clear whether the signal-to-noise ratio of hundreds of thousands of self-interested participants can be brought together to achieve any real goal. But, as we’re beginning to see with Social CRM, enterprise-class crowdsourcing, and prediction markets, there are now in fact workable ways for companies to engage and collaborate with large groups of people that greatly outnumber their workers.

Related: Community Management: The ‘essential’ capability

While it’s certainly true that the tools and platforms that enable online communities have not only greatly improved in the last several years but are now readily accessible by any business today, large or small, the real change that’s driving the adoption of online communities appears to be 1) that a significant and growing percentage of the online world now expects to be able to engage with a company online using social tools, and 2) organizations are increasingly understanding that there are tangible benefits to social computing and that it’s not just an overhead cost.

In other words, it’s the overall change in expectations regarding how organizations should interact with people (workers, customers, and otherwise) in general is what’s really new here. Social computing is a new “fabric” that we are starting use to bind ourselves together more dynamically and effectively in the workplace and elsewhere.

Getting a handle on community types

There are a lot of ways at looking at social computing and the visual above is just one way to organize the concepts, but it’s a very useful one I think. There are now so many ways to apply community approaches to the way that you operate a business or structure an organization, that it’s worth taking a look at the major ways it can be broken down.

• Open ended/self-directed communities. These are groups of people that have come together and brought their own needs and requirements to the community. Good examples of this type of community includes many open source software projects, self-organized (i.e. consumer-created) online customer communities, and horizontal Enterprise 2.0 environments. The hallmark of these communities is that while there is loose central control, the community can decide to go in just about any direction it thinks is useful.
• Consumer-focused communities. This includes forums such as most consumer social sites that have community features, most Facebook groups, and non-commercial media sites such as YouTube, Flickr, etc. What sets these apart is that they have usually have no business-related utility other than they may form the basis for an underlying startup that operates the site itself or related 3rd party add-ons. Consumer-focused communities however, can and do often organize around specific objectives that affect the business world and can play the role of the other types of communities at various times.
• Goal-oriented & managed communities Communities of this type are often created or sponsored by a business or are part of a business unit or process. They can include crowdsourcing efforts that reach out to a broad audience or it can be more internal such as with Enterprise 2.0. Social CRM is a tough one to categorize since it’s best when partially directed towards both customer goals and companies goals, but since it is more directed than open-ended customer communities for example, it probably belongs here. Gaining adoption in these types of communities can be hardest of all since excessive structure tends to kill participation. Specific examples include the LG phone design contest above and the recently closed down Netflix Prize.
• Business-focused communities These are online communities that entirely organized around business objectives, which include vertical commercial social networks, tightly controlled Enterprise 2.0 efforts, and and some types of customer communities. Some types of crowdsourcing also fall into this category, depending on whether there is purely work exchange taking place (instead of results that also benefit the participating customers.) Business focused communities thrive very well as long as they don’t have too much top-down control imposed.

Of course, these categories are hard to keep cut and dried for a given online community as they are continuously changing and evolving in the course of their existence. Subgroups within a community as well as roles over time can exhibit some or all of these traits at various points. But the key is that communities allow what are increasingly seen as artificial barriers to communication and collaboration to be broken down and enable human activity to achieve desires and objectives in a way that is much easier, richer, and less constrained. More helpfully, we have a map of how to look at how social computing can help in business both internally and externally.

Related: 12 best practices for online communities

This is not to say that making the transition to community models will be easy for most organizations; it won’t be for many. In fact, most organizations that I speak to that are doing this today or attempting to make the transition are finding that culture, tradition, and not-invented-here can be significant obstacles, as well having core competencies that usually lie in other places. It will probably be the case that some organizations may never bridge the gap between older ways of working together and community-based ones. Yet, while it’s still very early days for the evolution of social media to social business, the early results are frequently quite promising. I’ll explore the stories here as I am able to in the near future.

Is your organization engaging with or creating online communities. Please share your comments in Talkback below.