Seven steps for measuring social enterprise Return on Investment

The social enterprise is increasingly being touted as a game changer when it comes to improving how organisations collaborate and share knowledge to the greater good of the business. Wisely, savvy managers want to know what Return on...


The social enterprise is increasingly being touted as a game changer when it comes to improving how organisations collaborate and share knowledge to the greater good of the business. 

Wisely, savvy managers want to know what Return on Investment (ROI) they can expect to see from the technology before taking the plunge.  

And herein lies the problem when justifying social collaboration tools. 

Just because 20 percent of the people at a firm have used a social collaboration tool doesn’t necessarily make it a success.  

It’s how they are using it, the calibre of the knowledge being shared, and whether direct decisions or outcomes from the collaboration actually translate into increased sales or reduced costs that will make the difference.  

For example, social collaboration tools generate content that is relevant and timely, so employees reduce the time spent checking emails, perhaps from two hours to 30 minutes.  

This not only frees up more of their time, but can make them more efficient and knowledgeable which, in itself, can be beneficial on many different levels. 

But how can organisations measure something that doesn’t have any obvious quantifiable outcome? 

There clearly needs to be a  business case but if this is missing or if the critical success factors of the social initiative are misaligned with existing business performance metrics, it will be difficult to demonstrate the value of the project, with the conclusion being that social enterprise tools are ineffective. 

The following seven steps are a guide to how best to approach ROI from a social collaboration perspective. 

  1. Define what elements of the business need improving and then consider how social collaboration can help

    To ensure optimum impact from social collaboration, identify where in the organisation there are particular bottlenecks or specific issues that need to be addressed and consider how social collaboration could help with these.  

    For example, does there tend to be a high number of returning calls coming into customer support?  

    If so, could front line teams, in particular new joiners, benefit from easier knowledge sharing so that issues can be resolved first time around?  

    Making a positive impact on the day to day working lives of those employees will also help encourage buy-in to the technology both at a departmental level and across the business as its reach extends over time. 

  2. Target those departments which will benefit the most from social collaboration before rolling out elsewhere

    For already busy teams introducing what may be perceived as yet another process may not be welcomed.  

    Instead of taking a one size fits all approach and insisting that everyone adopts social technology, target those departments that experience the greatest pain due to ineffective collaboration or communication processes.  

    For example project teams, particularly those dispersed globally, who have to share ideas or remain up-to-date on project developments may be frustrated and snowed under with the huge quantities of email - both relevant and irrelevant - generated on a daily basis.  

    By transferring this communication onto a social collaboration platform, they can stay updated on the conversations which are of particular relevance to them without having to waste time ploughing through a bulging inbox of outdated and disjointed messages.

    Creating quick wins for social collaboration through smaller deployments are more likely to result in continued support for the project than attempting an immediate enterprise wide rollout.

  3. Align social collaboration to broad business objectives For social collaboration to be truly beneficial to an organisation, it needs to be aligned with the firm’s overall business objectives.  For example, increasing productivity or reducing sales cycle times over the next 12 months.

    This will ensure that the technology is fully integrated into the organisation and avoid it operating in isolation, where it will only benefit a handful of enthusiastic early adopters.   

    For example, is the improvement in call centre performance a part of a wider company strategic focus on creating customer loyalty by providing more knowledgeable agents?  

    Or in the case of a consumer goods company, is there an initiative to gain and retain market share by nimbly incorporating customer feedback in its products?

    What business objective is the organisation trying to achieve and how can social collaboration enable that agenda?

  4. Remember that adoption rates are only part of the story

    Judging ROI solely on adoption figures misses the point.  

    For example, a forum on an organisation’s social collaboration network might have a particularly high number of followers, but it doesn’t necessarily follow that it’s successfully improving how those followers work.

    Most case studies for social collaboration use adoption rates such as “about 20 percent of users will log in on any given day” as a key indicator of success.

    By focusing purely on how many people log in and attempting to increase that proportion, organisations can miss out on the actual benefits that can be achieved.

    Instead of getting another 5 percent of users to log in for 5 minutes at the end of their workday to check if there is anything worth reading, it is far more important that the 20 percent of users logging in remain logged in for the duration of the work day and use the tool for mission critical collaboration.

  5. Make sure you are measuring tangible success factors

    Following on from the point above, the social business community, at times, is at risk sometimes of over-evangelising  the intangible benefits of social tools. 

    Instead of focusing on employee engagement, adoption rates, greater collaboration, or reduction in time spent on email, companies should also look at existing KPIs to see which ones need improving and therefore may benefit from social tools.

    Employee engagement is one thing but the, the underlying KPI may be a reduction in turnover costs.

    Similarly, a reduction in email is beneficial, but looking at whether the sales team can reduce cycle times; if the marketing team can increase the number of campaigns; or if the contact centre can reduce the time spent on resolving level three support issues will give a much better indication of value. 

  6. Get regular input from users 

    Much of the success of any technology or business initiative comes down to its users.  

    There should be regular input therefore from them so that they can advise on the impact social collaboration is having on their day jobs.  

    For example, whether they are able to develop ideas better, are managing projects more effectively or are providing a higher calibre of customer service by accessing the knowledge of others. 

  7. Regularly evaluate the progress and success of social collaboration 

    Of those organisations that do assess the success of social collaboration, too few repeat the process.  Success shouldn’t be viewed or measured as a one off occurrence.  

    Instead, to enable social collaboration to become fully immersed into the working life of an organisation for the long-term, it needs to be assessed on an ongoing basis with adjustments made as necessary.  

    This will ensure it provides true value to the organisation.  Since social collaboration is tied into specific business goals, it becomes even more important to continually assess, refine and make adjustments to ensure these goals are being met.

    Setting up KPIs aligned to business goals can be a way to evaluate and track the progress and success of social collaboration.

As an organisation evolves, its social collaboration practices should continue to be evaluated to ensure optimum return on investment at all times, not just during the ‘novelty’ early days.  

Posted by  Daanish Khan, head of strategy, Formicary Collaboration Group

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