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Prominent VC Blogger Wonders if “Social Enterprise Software” is an Oxymoron

Posted by Bob Warfield on April 30, 2008

Fred Wilson wonders if “Social Enterprise Software” is an oxymoron.  There are a variety of startups out right now, some new, some established that are focused on variations of this idea.  A good example is nGenera (formerly known as BSG Alliance).

I’m surprised that Fred is even asking the question, though by the end of the post he seems to retain an open mind about it all.

Why am I surprised?  Fred says it best himself when he indicates that the heart of social software is the formation of a community.  Why is this so antithetical to the enterprise?  Every customer-focused organization’s dream would be to have a vibrant community.  Yes, there are fears about what that community might do and whether it can be controlled, but these are largely fears from old school social Luddites who aren’t going to be the initial audience anyway.  These are the guys that first fought having to have a computer (“my secretary can take a memo”), then fought email, and will continue to fight anything that interferes with their command and control mindset. 

Enlightened organizations have already moved away from that mindset.  They realize that there will be a community of their customers regardless of what they do.  It may be a Yahoo or Google Group.  It may be a LinkedIn association.  It can be an alumni group.  Or it can be on some forum somewhere.  It’s out there, it’s only a question of whether you want to hide from the community or foster it.

There are some great existence proofs already of what can happen when you foster community for some purpose.  Take Salesforce.com’s IdeaForce, which Dell has also adopted.  These are communities provided by the vendor to actively solicit input from customers.  The emergent behaviour there has been fascinating to watch.  In one case, a group used the community band together and convince Dell it needed to offer Linux on its machines.  This is one of those glass half full/half empty moments.  Did we conclude the community was a bad thing because it forced our hand, or was it a good thing because we learned what was important to customers more quickly and could respond?  I’d rather be playing the latter hand than the former.  Customers never force your hand because the customer is always right.  Your challenge is to understand what they’re trying to tell you.  If that’s not Social Enterprise Software, I don’t know what is.

Take Rally Development, a company whose web site I’ve lately become enamored with.  They do a wonderful job of bringing their community right to the forefront and using it both to inform their decisions, keep the community happier through participation, and even turn it back out into the world as evangelists on their behalf.  Another example is Helpstream, which is working hard to meld community and customer service.  See, for example, CEO Tony Nemelka’s blog post on how to Listen To Your Customers.

Does this mean communities have to be completely open, unmoderated, and not subject to any rules?  Certainly not.  Anyone who participates in a community knows there are fine lines to moderation.  Too much is stifling.  Too little is an open invitation for Trolls and other undersirables to ruin it for everyone.  Most communities, like gardens, benefit from some proficient pruning.  I posted recently about how judicious content pruning allowed HubPages to accelerate its growth and catch up to competitor Squidoo.

What will be interesting is to watch how the Enterprise evolves.  The goals for Social Enterprise Software should not be controversial.  The ability to execute, will be new.  However, the combination of new generations coming up through the ranks who are very familiar with these new communities and a new breed of startups that help out in this area will combine to make it easier for any Enterpise that wants to embrace the opportunity to move forward.  I expect the leading companies will choose to do so.

In fact, I would expect this trend to change the very fabric of Enterprise Software.  In the past, it’s always been highly workflow (business process) oriented:  “We want to precisely control the process to Six Sigmas if we can.”  The next step is to do completely the opposite.  That’s finding ways for people to process lots of bursty activity, do what they do best, interact in the style they’re most productive with, and generally change the way the game is played instead of just being perfectly controlled cogs in the machine.   Cogs are fine when everyone needs to be treated exactly the same both inside an outside the organization, but the Internet brings personalization and the Long Tail.  Another way that this can play out is to marry Business Process with community.  That’s another aspect of what Helpstream is doing.

Take advantage of the idea that everything is not the same.  We want a repeatable quality of experience, not a repeatable process.  Build a community.

One Response to “Prominent VC Blogger Wonders if “Social Enterprise Software” is an Oxymoron”

  1. bmagierski said

    Hi Bob – Nice post and thanks for the reference to nGenera. I am the Chief Development Officer there and post here and blog here.

    I think you really hit on some key points, especially in the last two paragraphs. The adoption of ‘social enterprise software’ is really about the next generation of processes and applications needed to run competitive enterprises in the next couple of decades. The demands of globalization and global competition, the talent crunch and the entry of the Net Generation into the workforce (those that grew up on the net and are addicted to social media and mobile phones), and Web 2.0 will require that enterprises adapt and become more agile and “social” (i.e. collaborative) in nature.

    Your idea of the fabric of enterprise software changing is fundamental to our belief as well. I think Fred missed this point in his post and I am planning to comment there about it there. We believe that this next generation of on demand enterprise processes and applications will have social networking and web 2.0 style collaboration at their core. This goes beyond setting up a wiki or blog, which is what I think Fred didn’t hit on, but making those concepts and capabilities core to strategy planning applications, compensation and incentive applications, customer experience and interaction applications and others.

    Where I think Fred is right is it all depends on community developing at the core – which I believe enterprises will have an increasing incentive to develop unlike in the past (think Alumni networks to start, and the next 1 to 2 degrees from there for talent sourcing outside the enterprise). For example, with the talent crunch underway (boomers “retiring” and Net Geners entering), I’ll bet that those “retired” boomers would make a great variable talent force for many enterprises, and what better way to stay connected than through a talent application enabled by social networking, collaboration and incentive management capabilities.

    In the world of the Net Gen, where enterprises will increasingly need to engage their Talent outside the organization and try to bring their customers inside the organization to co-innovate, we believe social network and collaboration enabled processes and applications will be required to be agile and competitive in the coming decades. This is not your father’s enterprise software. Nor is it merely setting up wikis and blogs.

    Great conversation topic and thanks for the post!

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