How To Design A Social BusinessHow To Design A Social Business

11 Management Systems That Can Help You Get A Handle On Social

Dion Hinchcliffe and Peter Kim have written the book that they would want to hand to any executive who needs convincing about the value of social business.

Social Business by Design, the book by Dachis Group Executive VP of Strategy Hinchcliffe and Chief Strategy Officer Kim, is the comprehensive book on the whys and wherefores of social business that they say they couldn't find anywhere else.

"We looked at what books were out there, and there are some good ones, but most were either slightly older or they were notational--this is what's going to happen. They didn't really explain sufficiently, in our minds, how strategic this could be," Hinchcliffe said. As he and Kim assembled the success stories they wanted to use, "we tried not to pick anything where there was a small, incremental benefit," Hinchcliffe said.

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One of his favorite stories in the book is about Intuit, which used crowdsourcing techniques to make its TurboTax service the number one tax preparation solution, eclipsing its more traditional rival H&R Block. H&R Block's advantage lay in having tax advisors in offices all over the country to answer people's questions. Although TurboTax had a cost advantage as a software-only solution, it had a hard time providing as high a level of service, particularly in the intense weeks leading up to Tax Day in April. "It really kept them from being the industry leader," Hinchcliffe said.

Intuit's answer was to build social collaboration into the product and allow taxpayers to help answer each other's questions, with community voting to identify the best answers. Intuit tried this initially with a stand-alone social community and later with a task-specific question-and-answer function built into every screen of the product. Intuit never could have hired enough customer service representatives to address every taxpayer question, but a social software approach allowed it to offload that responsibility onto its customers. "They let customers rate the answers, get rid of the bad ones, promote the good ones," he said, and it worked. "By the next year, they were number one in their industry."

Social Business by Design is a broad survey of all the ways social media and social networking techniques can be applied to business, ranging from those focused on marketing and customer support to crowdsourcing, data analysis on data from social networks, and the intranet applications of enterprise social networking. Some of the examples may be familiar to readers of The BrainYard, such as how social media analytics can improve stock picks and social collaboration can streamline supply chain operations.

"We deliberately addressed marketing, IT, HR, and various stakeholder perspectives," Kim said. "We wanted to cover employee-to-employee, business-to-consumer, and supply chain experiences and make this the book that is all-encompassing. It's not just marketing or IT or any other part of that picture."

The book leads with the customer-facing applications of social business "because there's much more interest in customer engagement, and it's a much bigger problem," Hinchcliffe said. Often, there is a parallel effort in organizations to bring social media dynamics inside the company "and we do believe that social business is a continuum, where the most interesting scenarios are where you have a combination of those things."

Hinchcliffe and Kim said their book deliberately emphasizes the upside, although they don't see much of a downside to social business. Unlike enterprise projects aimed at reengineering the corporation or dramatically redesigning the supply chain, the risk of a disastrous failure is minimal, they said.

"You're just not going to lose that much money if your SharePoint implementation goes bad," Kim said. "These things fail, just not spectacularly. The failures tend to be more about neglect and non-use."

The bigger risk tends to be failing to engage in social media when it counts, particularly in terms of public social media interaction in the midst of a crisis. Toyota's handling of a series of high-profile recalls and British Petroleum's response to the 2010 Gulf oil spill are portrayed in the book as examples of what not to do.

In contrast, the authors tell the story of Ford's social media leader Scott Monty intervening in a trademark infringement dispute between Ford's lawyers and the owner of an online fan site, TheRangerStation.com. By jumping in early, even when initially he could only promise to investigate the issue, Monty was able to defuse the situation "before it became fodder for traditional media and potentially a much larger social media crisis," the authors write. By the end of the workday, Ford and the website owner had reached an agreement.

After surveying the techniques and the success stories, the authors devote the last section of the book to how you achieve social business "by design," with an outline for setting and executing strategy, including setting priorities and plans, organizing pilot projects, and driving adoption. Hinchcliffe calls it "probably the most complete view how to begin the journey of becoming a social business."

Don't expect specific software product recommendations because that's not what this book is about. But for those trying to sell their companies on why social business makes sense, passing around a few copies of this book would be a good way to start.

Follow David F. Carr on Twitter @davidfcarr. The BrainYard is @thebyard and facebook.com/thebyard

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