Should Corporations invest in Social Networking tools?

With every day passing Social Networking technology is scaling new heights, one of them are their ever increasing presence in corporate world. The article by ‘Jon Swartz’ – “Social networking sites help companies boost productivity” (link at end), avers that the total gamut of social networking sites is helping companies in improving their productivity. The author says that it helps in reducing travel costs, improving communication among workers spread across geographies, disseminating the ideas throughout the organization and many more.

Many companies are nowadays thinking of how can they take the advantages of Social Networking technologies but truth is lot of them are still skeptical about investing into the same. I came across an article in this context by ‘Tim Ferguson’ with title – “Companies warned not to rush into social networking” (link at end). The author has advised to consider issues like protection of Personal Intellectual Property, preference of employees to use existing non professional external networks like ‘Facebook’, maturity of technology etc. He cites the ‘Gartner’ analyst report and asserts that the content is what is more important than the technology and also recommends that, “IT departments think very carefully before committing to expensive social-networking white elephants”. Though ‘Tim Ferguson’ has a point but what he is missing is the many ways that social networking tools can help. They are not just the communication tools but if utilized properly could be much more.

The use of these technologies can broadly be classified into two aspects – ‘external to organization’ and ‘internal to organization’. By ‘external’ uses involved use of ‘Community sites’ like ‘KnorrFamily’ which not only helps in marketing and building the brand of the company but also on creating more value for the customers. The external part is generally more apparent and what sometimes goes missing is the enormous potential of the ‘internal’ solutions. The ‘internal’ uses involves usage of solutions like ‘Corporate wiki’, ‘Technical Blogs’, ‘Online white boards’ and many more.

The ‘Corporate wiki’ is internal to a company and is essentially a database for creating, editing, browsing, and searching through information. The goal (and convenience) of a Wiki is to encourage everyone to participate without the trouble of managing usernames or passwords. ‘Technical blogs’ help in transferring the information regarding latest technology, its implementation etc with great ease. ‘Internal’ solutions have found its use in many companies like Sony, BMW, Disney and McDonald and add business value in the following manner:

· Bringing a cultural change (More participation among workers)

· Collaboration within Teams( when teams are constructed at both offshore and onsite)

· Knowledge Sharing

· Faster Updates and responses

· Cost Reduction in information transfer

The benefits of social networking tools are much more than the costs involved. What one has to consider is that the costs involved are explicit and can be measured. But all benefits can’t be monetized and measured. For instance, the improved morale of the employees due to increased involvement through ‘corporate wiki’ will help improve their productivity, but this is not easy to measure. Thus companies need to consider all the benefits tangible and intangible to make their decision and benefits in most of the cases will overwhelm the costs involved.

Companies warned not to rush into social networking

http://news.cnet.com/Companies-warned-not-to-rush-into-social-networking/2100-1032_3-6223009.html

Social networking sites help companies boost productivity

http://www.usatoday.com/tech/products/2008-10-07-social-network-work_N.htm