Archive for the ‘social media’ Category

This bookends yesterday’s piece about economics.

I have always been interested in the similarities between biology and economics and ultimately business. In the last few years we’ve adopted some of the parlance of biology when we talk about business, especially social business. Perhaps the best example is the analogy we freely make between a vendor and its partners and supply chain, i.e. “the ecosystem.” But itdoesn’t stop there; it extends to the customer as well.

We use “ecosystem” in a truncated form, assuming all relationships are good or beneficial, but that doesn’t have to be the case, and reality does not support this sanguine view. After all, there is a relationship between the gazelle and the lion, though it only seems to benefit one side. But even here, the lion provides a valuable service — if not to individual gazelles, at least to the species — by weeding out the least well-adapted and the plain unlucky.

If you study an ecosystem, there are at least four kinds of relationships, and one defines each species’ place in it. You can even represent these relationships in a two-by-two chart that describes these symbiotic relationships. Let’s take a quick look at them and then make the CRM point of this piece.

The four symbiotic relationships that define life in an ecosystem are:

  • Mutualism, a relationship between two species of organisms in which both benefit from the association.
  • Commensalism, a type of relationship between two species (plant, animal, fungus, etc.) in which one lives with, on, or in another without damage to either.

The next two are tricky because they seem rather similar.

  • Amensalism is a symbiotic relationship in which one organism is harmed or inhibited and the other is unaffected.
  • Parasitism is a relationship between organisms in which one lives as a parasite on another.

We well understand parasites, but the relationship does not have to be destructive. The big difference between the last two is that parasites may harm their hosts but the best parasites derive all their needs from the host without harm. There can be parasites that are amensalists, but that’s getting rather technical. How would you describe the relationship between the dairy farmer and his herd?

I sometimes think that one of the big tests of CRM and especially our socialized version is that much of business has evolved along the lines of the last two — parasitism and amensalism. If the last decade of CRM has taught us anything, it is that business needs to get to commensalism or mutualism. Customers are demanding it, and even our language about business suggests this.

Do we have customers or consumers? In my mind, customer describes a more mutualistic relationship, while consumer suggests a relationship that is at best parasitic, and maybe not in a neutral way. Our software necessarily reflects our take on the relationship. For instance, is our sales software designed to accelerate deals or to help us do good, mutually beneficial business?

You can’t let customers off the hook, either. How many of us seek only the best deal regardless of whether that deal leaves the vendor without sufficient margin to provide decent support? In these Occupy Wall Street Days, it might not be fashionable to feel for the vendor, but you can’t have a relationship with only one party, so the condition of the opposite member is always a concern. Note that our four definitions make that implicit point.

Social technology is what enables mutualism; it is a necessary but far from sufficient condition of the relationship that social technologies exist. Interestingly, without it we are all independent actors interfacing with a sometimes impossibly large vendor. Without social we are all nothing more than consumers, and that’s the point of business today.

Economics may need to be reconsidered in light of social media. Think about it: One of the bedrock assumptions of economics is the rational actor theory. We’re all rational actors who make decisions and take actions based on our analysis of available information. So how is this affected when information is so much more available through social media? Does having more knowledge — including knowing that others know more or ought to — reduce our options in the market? I think it does, and it means relationships need to be more equal — commensalism or mutualism.

It’s my observation that companies that have yet to adopt social approaches and technologies have consumers. But as time goes on and those same people interact in different ways with each other and with other vendors, the differences between being a consumer and a customer become glaringly apparent.

Companies can adopt social technologies and techniques in an attempt to “speed up” conventional relationships. But the more successful companies already show that social moves the needle in the direction of mutualism.

For most of this year, Esteban Kolsky and I have been working on a study to better understand social media in business.  Today the survey is live and we’d really appreciate it if you could take some time to answer it.  This is your chance to tell us what works and what doesn’t and it will add significantly to our understanding of this rapidly growing and changing market.  What we learn here will be shared with you through forums like this so please take just a few moments and tell us what you think.  Start the survey.

This week Esteban Kolsky and I launched a research initiative aimed at better understanding how businesses across the world are adopting social media for their business processes.  There has been anecdotal evidence over the last five-plus years about social’s efficacy as a business tool and there have been about as many stories of companies that have failed to see any benefit.  We say enough of this, let’s get down to brass tacks!

By the way, do you know where brass tacks comes from?  You probably do.  In the 19th century people made most of their clothes for which they bought material from the general store.  Cloth came in bolts made up of a specific number of yards (some bolts are longer than others, even today) and the purchaser might order a few yards for a project.  Storekeepers got to be pretty good at estimating a length of cloth.  I would have been a natural at it because my wing span is six feet.  At least I could easily measure out even numbers of two or more yards but measuring three would present a small problem for me.

Every general store had a mark on the counter delimited by, guess what?  Brass tacks!  Measuring out a yard of cloth became nothing more than comparing a length of cloth to the reference on the counter.  This might also be where the idea of a benchmark comes from but I have no proof (but it would make a nice story, no?).

So our effort regarding social media follows an honorable and perhaps convoluted history.  My casual observation has been that small or emerging companies like Zapatos have been better at adopting socialized business processes than larger companies but then there are companies like Burberry’s and Toyota who have gone whole hog on the social enterprise vision of Marc Benioff.  So, enough with prognosticating, let’s get some answers.

Therefore, after all this time getting the dope on social media adoption might be something that should be of genuine interest to all of us — Esteban and me especially.  If this is something that interests you as well, then we have a small favor to ask.  Take the survey we’ve put together and tell us what you see and think.

The questions are easy in that they don’t require special effort or math skills, just tell us what you think.  There’s a prize at the end but you will need to answer the whole survey to discover it.  So please take our survey.  The future of western civilization does not hang in the balance, but your job might.  Just sayn’.

I spent most of last week in Boston at the Enterprise 2.0 conference where I was honored to be the sales and marketing track chairman.  Next year it will be called E2 Social and will bookend the other conference that has been held in Santa Clara and will become known as E2 Innovate.  There’s good symmetry here.  I can’t think of another purely social show or one focused on innovation.  Most shows today are vendor sponsored which is good but different.

Our track had some cool presentations on social marketing from IDC mavens Gerry Murray and Joe Farentino, revenue performance management from Phil Fernandez, CEO of Marketo, and an intriguing discussion from Pam Kostka, a fellow Crusader and CMO of VirtuOz, a company that makes virtual agents.

If you are wondering, a virtual agent is a software robot that you can talk to regarding sales, marketing or service issues just like a person.  These agents are a happening thing and promise to do away with wait times and improve service.

There were also two panels, one on M&A activity that we put together last minute with the able assistance of Sameer Patel, Josh Greenbaum and Louis Columbus.  As is so often the case with these things, serendipity played a role and caused more than a few people to walk away with the idea that this kind of thing ought to happen again.  Thanks guys, the panel was outstanding and a good example of the talent pool that lurks in the Enterprise Irregulars a group with a low profile (that ought to be greater) and an inversely proportional IQ factor.

The other panel, which I want to focus on, was illuminating to me for an unexpected reason.  I invited some of my brain trust including Thor Johnson, Cary Fulbright, Derek Peplau, Columbus and Murray mentioned above.  Toward the end we had a discussion of big data and someone mentioned a large company that had converted from one CRM system to another and had deleted many years of sales data in the process rather than bring it along and try to figure it out.

Initially I thought throwing away all that data was folly but I came to see it as smart but for reasons that I think are different from the consensus of the panel and audience.  One audience member got the analysis right, in my opinion, when he said simply, “There’s nothing in it,” by which he meant there was a great deal of data but that it was devoid of information content.  How could this be?

Very simply, most CRM systems either have fields or enable you to create them to capture important data like product interest, deal size, projected close date and much more.  All of this is valuable but CRM’s point of failure is that these fields can be overwritten and there is no provision for storing historical information.

Now, you’ve heard my sermon on historical data before most likely.  But at E2.0 I had an insight about the difference between sales and marketing that reflects the difference in the data we collect and analyze in each space.

In marketing we collect data once from a large sample.  If you run a program against a list you collect data from a large number of people one time.  You analyze the data and perhaps discover people who are interested in a product now or in the future and you process accordingly.

Sales is different.  The universe of data sources is smaller but the sources give off data constantly through a sales cycle.  Sales reports — pipelines and forecasts — show a single cross section of the data and they are equivalent to the individual frames of a movie.  Most of the time it’s hard to say much about how a film ends by examining a random frame.  Sometimes you get lucky and the random frame shows the butler with a knife in the in the library etc. and you can make a deduction.  But most of the time you aren’t that lucky.

Unlike the movie, which is a succession of stills projected in rapid succession to give the illusion of movement, the sales forecast is a one and done thing.  Worse, making the report necessarily destroys the old frames.  So, getting back to the company that threw away old data, I would throw it away too.  The old data was simply the last frame depicting the end state of a deal and usually the end state is a loss.

There’s almost nothing you can discover from the end state but if you have all the frames that led to the end then you can apply analytics to it and find out things you didn’t know.  Analytics lets you play the movie back and forth to find the aha! moment.  But you need to keep all the frames.  The point is that in marketing you can apply analytics to a single state of the market but if you try to do the same with sales you’re toast.  Sales data is different from marketing data and so are the ways we analyze it.

In the panel I moderated last week that idea was not in evidence and it shows how we need to re-think and maybe find new people who think differently about selling and sales data.  Without new thinking we’re liable to not be able to figure out the importance of social tools and selling will continue to be a hard nut to crack because it remains more art than science.  It doesn’t have to be that way.

The Enterprise 2.0 brand got a good and strategic retrofit this week in Boston when the show’s guiding light Paige Finkelman announced some changes.  As you might know, the show has been a twice-annual affair with events in Boston and Santa Clara spaced roughly six months apart.  The new arrangement keeps the two shows but focuses them in slightly different and complementary directions.

The Boston event will remain focused on all things Social and will be held in my fair city in June (great place once the snow melts) and it will be called E2 Social.  The Santa Clara event will become E2 Innovate and that can use some discussion.

E2 Innovate is located in Silicon Valley, one of the greatest places in history for innovation after the Tigris and Euphrates River valleys circa 10,000 BC.  There they invented the wheel, farming and beer (you can look it up), not too bad if you ask me.

As you’ve heard me say many times before, there’s more innovation than CRM or Social going on and E2 Innovate will be the place where these disparate birds of a feather congregate.  This will reduce the burden for venture capitalists who will only need to drive a little bit south on California route 101 with their car trunks full of money to dispense.  It will continue providing a venue for new ideas and be accessible to the likes of people like me, so it’s all good.

In the early years of a trend like the social conquest of business, two shows a year provides some needed momentum to get ideas percolating.  Much like the first stage of a moon rocket, the early years are dedicated to getting moving, but with that accomplished it’s time for stage two and insertion into orbit.  That’s what this move does.

Aside from vendor sponsored shows like Oracle OpenWorld, Salesforce Dreamforce, Sage Summit, Microsoft Convergence, SAP Sapphire and many others, there are very few events today that offer a startup the chance to test the waters especially if they are sprouting a new niche.  E2 Innovate will do this and at the same time serve as a feeder to E2 Social or something beyond.

I like these ideas.

Now you also need to know that I was the sales and marketing track chair for this year’s Boston event and this did not influence my thinking or writing.  I just write about the things I see and understand.  A limited universe to be sure.