Is it all over for social? Clues are everywhere

As the hype cycle turns, social is coming under scrutiny. Has the folly of the past finally started to catch up with the vendors or is the issue far deeper?
Written by Dennis Howlett, Contributor on

Larry Dignan's riff on a Cowen & Co report is worth expanding upon. The story in a nutshell is that Cowen's believe Salesforce.com is struggling to get a payback from its investments in social. Dignan summarises the collective EIs analysis as follows:

  • The social enterprise is about culture, management and process. It's not about software.
  • If that culture and process point sounds familiar that's because social software may be ERP in a new wrapper. ERP software changed companies fundamentally, but also led to spectacular IT disasters largely due to people, process and culture. Social with business process integration won't work.
  • Internal collaboration also creates social mojo. Collaboration goes well beyond software and frankly is difficult.

Cowen's analysis needs putting into perspective. Peter Goldmacher, the lead analyst of the report has long been critical of Salesforce.com's reported results, arguing that Salesforce.com's excessive use of stock based compensation requires that the share price be continually pumped in order to avoid a catastrophic outflow of cash at a company that is barely profitable. That aside, the arguments put forward by the EIs while logical doesn't answer any of the root problems. It is not enough to conclude that we're going through a cycle and, in Dignan's words:

Quietly---and just as everyone writes it off---something else comes along as an enabler. The social enterprise may follow a similar route, but for now it's disillusionment time.

That is a huge leap of faith for a technology play that has, in my mind, always been riddled with problems. Neither does the EI answer provide vendors or their customers with a way forward. Now, if we want to talk about Salesforce.com in particular, I can perfectly see how this serves as a proxy for failure. 

I have seen Chatter implementations in businesses of 150 people where understanding the information flow in pipeline management is difficult. Part of the problem is software related because the addition of certain features would help fix the problem. On a personal project, we decided to use Google Docs to run a brainstorming session. Guess what? Within 24 hours, some of us (ahem) were back in email. And this is a group of digitally savvy folk. What's up there? It's tough to get a bunch of smart people to behave according to 'rules.' It can be done but it is hard.  

The me generation

Coincidentally, I caught up with a piece Oliver Marks wrote about the 'me' generation, with the lament that:

An English CIO complained to me recently that most incoming fresh-out-of-college employees had the 'attention span of gnats', wanted to immediately take charge of projects without supervision and were generally very overconfident without the skills to back that up.

Just as many of us bemoan the 'entitlement economy' of incumbent application vendors, it seems the new generation of employees are compounding the problem. Anyone remember the early days of Twitter 'fail whales?' Despite the lauding of folk like co-founder Jack Dorsey, the early cadre of engineers had little understanding of how to scale an exploding service. It was a technical problem about which the young guns had no clue because they didn't have the experience. The new generation may well be used to social tools but if Cowen's observations are correct then nothing is changing because they genuinely believe that their educational prowess is enough to carry them through. Nothing could be further from the truth.  

Back in 2009, I said

Like it or not, large enterprises - the big name brands - have to work in structures and hierarchies that most E2.0 mavens ridicule but can't come up with alternatives that make any sort of corporate sense. Therein lies the Big Lie. Enterprise 2.0 pre-supposes that you can upend hierarchies for the benefit of all. Yet none of that thinking has a credible use case you can generalize back to business types - except: knowledge based businesses such as legal, accounting, architects etc. Even then - where are the use cases? I'd like to know. In the meantime, don't be surprised by the 'fail' lists that Mike Krigsman will undoubtedly trot out - that's easy.

Endemic or edge case issues?

My general view hasn't changed that much but today I have a better understanding as to why social remains a problem. The EIs identify the issue as 'cultural and business process' but 'culture' in particular could mean almost anything. In the last few days, I have come to the conclusion the problem is much, much deeper and will not be solved by technology any time soon. In that regard, I am now much more closely aligned with Euan Semple's view that it will take an entire generation for 'social' to become an embedded part of our business world. I'll explain why in a moment. 

Over the holiday season I became painfully aware of just how badly some of the brands with which I regularly engage treat their customers, compounded by the abusive use of social tools. Low cost airline EasyJet for instance has been deluging its Plus card holders with emails requesting participation in social surveys. However, when I look through them, all I see is a desire to build happy talk or acceptance of dopey policies. I see no attempt to respond thoughtfully to genuine concerns. 

Semple says:

Lively and active internal social platforms enable an organisation's small quiet voices to be heard who otherwise get drowned in the noise and corporate bluster. When someone thinks "that's odd - not seen that before - I wonder what it means?" they can share it. Others can react. The organisation can become more self aware and self correct. 

I thought this during the banking crisis. Sub-prime mortgages happened because those thinking "Eh? Are you kidding?" never got heard. 

It's hard to believe that nobody in Tesco or their supply chain noticed the horse. Maybe if their small quiet voice had been heard...

This was about horse meat found in some beef burgers on sale at Tesco, the UK's largest retailer. But notice what Semple is saying: social begins inside a company. Taken one step further, any company that cannot create an internal social enterprise has no hope of developing a credible external social enterprise. And it is endemic. 

I have recently been working on a project that requires me to acquires specialist online services for performance optimisation. A couple of vendors come recommended. Both are 'newgen' vendors. Both say they're passionate about customers. One deleted my API without any notification and without providing the promised explanation. The other has failed to answer two important pre-sales questions but continue to send formula emails encouraging me to sign up. If they can't get simple service attention right at this early stage what hope for the future? Both have social elements as part of their overall service offering.

So what's wrong? Why is this continuing failure in social so endemic and difficult to overcome? The clues are all around us but hard to see. In part two I will outline one root cause reason along with a recognition of the conditions under which transformational success is possible. 

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