The Social Business:Challenges and Opportunities

Stuart J. McRaeExecutive Collaboration & Social Business EvangelistIBM

stuart.mcrae@uk.ibm.com www.twitter.com/smcraewww.linkedin.com/in/stuartmcrae www.facebook.com/sjmcrae www.smcrae.com

Brussels, 8th July 2014

The Internet and BusinessFirst came the World Wide Web...

Internet ofInformation

The Internet and Business… then eBusiness came along ...

Internet ofInformation

Internet ofProcesses

The Internet and Business… and now we are in the social era ...

Internet ofInformation

Internet ofProcesses

Internet ofPeople

The Internet and Business… but it won't stop there ...

Internet ofInformation

Internet ofProcesses

Internet ofPeople

Internet ofThings

InstrumentedInterconnected

Intelligent

The Internet and Business… as we find more and more ways to use digital content

Internet ofInformation

Internet ofProcesses

Internet ofPeople

Internet ofThings

InstrumentedInterconnected

Intelligent

ANALYTICS

Big Data

CognitiveComputing

"We tend to overestimate the effect of a technology in the short runand underestimate the effect in the long run"

- Amara's Law, Roy Amara, Institute for the Future

Change doesn't just stop

Watson, who is nearby and can fix the teleporter?

The Social Internet is already changing business (again)

More companies NOW use socialinternallythan externally

We are entering the Post-PC era with Apple selling 100M iPads in 2013, shifting usage from creation at desks to consumption on the move

66% of top financially performing companies leverage social in their business processes

Sources: Twitter, Jeff Bullas; Pew Internet & American Life Project; IDC; LinkedIn; The Real Time Report; Regalix; CultOfMac; McKinsey

McKinsey estimate that social technologies could raise the productivity of interaction workers by20-25%

Public social networking has proven the power of conversations and relationships

Four technology megatrends are driving social business… and causing disruptive change because they are happening together

A social business isn't just one that uses Twitter & Facebook

It is one that leverages the latest technologies,including Social, Mobile, Analytics, Cloud

to build employees' internal& external relationships

to collaborate with its partners to manage its talent to delight its customers to improve its processes to innovate

… to deliver better business results

These new technologies are challenging the way we work

Pressure to build and share expertise for competitive advantage

Increasingly influential and vocal customers

Growing demand for 24/7and mobile connectedness

Complex ecosystems require collaboration outside the company

Social Businesses respond to these challenges

Culture

Technology

SocialBusiness

engage employees

in conversations with customers

collaborate withpartners to

servecustomers

better encourage employees to collaborate not to competewith each other

Internal External

open upaccess to

knowledge &expertise topartners

engagecustomers via social networks web, mobile,

voice & video

provide an open, simple, integrated, collaborative workplace

But require new platforms of engagement to succeed

Culture

Technology

SocialBusiness

engage employees

in conversations with customers

collaborate withpartners to

servecustomers

better encourage employees to collaborate not to competewith each other

Internal External

open upaccess to

knowledge &expertise topartners

engagecustomers via social networks web, mobile,

voice & video

provide an open, simple, integrated, collaborative workplace

To empower their people to execute better

Market Management Process: MarketingDo market segmentation in real-time and allow the marketing team adjust advertising on the fly

Critical Situation Process: Customer ServiceFind who can best help me address this urgent problem for my client

Software Deployment Process: ITFind the technical expertise and institutional knowledge to fix an error in our ERP system

Talent Management Process: HRAnticipate and react competitive poaching of top talent

Lead Development Process: SalesUse predictive analytics on every customer

interaction to gather insights into what customers will buy next

IBM White Paper on Applying Social Business: http://bit.ly/1i8iUPn

Enabling Social Businesses to deliver better results

Improve Customer ServiceCan achieve 5% reduction in customer defection rate increasing profits by up to 68% (2)

Speed up Product Development

Can develop and bring new products to market in 1/3 time (3)

Increase SalesCan increase sales manager revenue by 40% and improve efficiency by up to 50% (1)

Better Marketing Can achieve 100% increase in market exposure (4)

Source 1: VCC case study, Source 2:Bain & Co Source 3: Cemex case study, Source 4. Amadori case study Source 5:Independent Study by The Corporate Executive Board, 2004Source 6 Cars.com Case study, Source 7 Robinson Club

Maximize ProductivityCan retain the knowledge of seasonal staff within the company, and thus increase customer satisfaction in our resorts (7)

Reduce Employee Turnover Can reduce turnover, highly engaged employees are 87% less likely to leave their organizations than highly disengaged employees(5) Increase Visibility

Can increases website traffic by 145 million visits (6)

Example: Governments traditionally rolled out generic programsWhich either met the needs of the individual, or didn't...

The digital era should be transformativeAs each individual citizen select personalised services from a menu available to them

Which requires collaboration across the Public SectorNot just integrating IT systems, but collaboration between employees

OneIntegratedExperience

Key challenges for government in the social era: Inter-departmental, agency, authority

collaboration Collaboration with the third (voluntary) sector Working with small & medium enterprises Engagement with communities of citizens

For years we have said that

we need moreIT people who

understand Business

Tomorrow we don't needmore IT people

who understand business...

we need morebusiness people who

understand technology

Social Business is an enabler for the transformation of IT

Self Service IT, Bring Your Own Device and Software as a Servicewill commoditise many IT services as well as the end points

leaving IT free to focus on advising, coaching, and compliance for“User Generated Everything”

Source: Tim Banting, Current Analysis, LinkedIn Update

2004“Why People Still Matter”

by Levy and Murnane

… discussing the difficulties of replicating human perception,asserted that driving in traffic is insusceptible to automation“executing a left turn against oncoming traffic involves so many factors that it is hard to

imagine discovering the set of rules that can replicate a driver’s behaviour”

2004“Why People Still Matter”

by Levy and Murnane

… discussing the difficulties of replicating human perception,asserted that driving in traffic is insusceptible to automation“executing a left turn against oncoming traffic involves so many factors that it is hard to

imagine discovering the set of rules that can replicate a driver’s behaviour”

2010Google

announces that it had modified severalToyota Prius' to be fully autonomous

2013

“According to our estimates, about 47 percent of total US employment is at risk.”

“While 19th century manufacturing technologies largely substituted for skilled labour through the

simplification of tasks... the Computer Revolution of the 20th century caused a hollowing-out of

middle-income jobs”

bit.ly/1hykTLK

Business models and business structures are changing

“Kodak was founded in 1880, and at its peak employed nearly 145,300 people...

Kodak’s founding family, the Eastmans, became wealthy”

“Instagram was founded in 2010 by a team of fifteen people. In 2012 it was sold to Facebook for over $1bn.

Facebook, worth far more than Kodak ever was, employs fewer than 5,000 people. At least ten of them have a net worth of ten times that of George Eastman.”

http://bit.ly/MOzgzE

“...even accountants & lawyers will start to feel the heat...”

We are inventing new, innovative ways of doing business...

Nick D'Aloisio created Summly in 2011...aged 15...

in 2013 (at 17) it was bought by Yahoo!...reportedly for $30M...

in 2014 Yahoo News Digest was announced

… requiring an emphasis on different skillsas people are focussed on where they can add value

InnovationThought

Problem solvingFace to face

Empathy

Persuasive Selling

Caring

Creativity

Personal ServiceExclusive

Luxury

Social TalentOriginalityUnderstanding

Fine arts

Leadership

Dexterity

Authority

Collaborative

Engaged

Stuart J. McRaeExecutive Collaboration & Social Business EvangelistIBM

stuart.mcrae@uk.ibm.com www.twitter.com/smcraewww.linkedin.com/in/stuartmcrae www.facebook.com/sjmcrae www.smcrae.com

Brussels, 8th July 2014

Thank You.