Posted by: charlestontelles | September 7, 2012

Enterprise 2.0 – The value of a virtual friend

In my previous post I talked about the Accenture adoption for Enterprise 2.0 and the massive campaign inside the company to incentive collaboration from employees, that was back in 2009 and I was there 🙂

Well, I contacted Angela Gordon who has done the presentation about Collaboration 2.0 (that’s the Accenture’s official name for their E2.0 tool set). I asked her about some numbers since Collaboration 2.0 was released and here are some numbers from Accenture’s ROI:

  Some cost savings declared:

 – More than 20 million minutes of company-standard monthly VoIP audio/video usage

 – More than 5,000 annual video conferencing meetings resulting in avoided travel costs.

 – Telepresence usage has slashed travel costs and the savings are exceeding our annual targets

 In my view the numbers explored by Accenture shows only a reducing in  telecommunication costs. But where is the core ROI? Where is the measure for collaboration and knowledge sharing? In fact, there is no simple answer for those questions.

Companies like IBM, Microsoft, and Yahoo!, are hiring economists, anthropologists, and other social scientists to map and classify new types of friendships—and put a value on them (see the article “The value of virtual friends”)

Measuring improved knowledge retention isn’t easy – the KM (Knowledge Management) guys are pondering this space for more than 20 years – thus, measuring the effects of a more collaborative corporate environment and a knowledge sharing culture that we may get via Enterprise 2.0 can’t be much easier (see this article from www.frogpond.de)

From the references provided in the end of this blog I came up with a list of possible outcomes to be considered in ROI for E2.0:

1)    Less Waste and Duplication. For example reducing the amount of email and instance message by posting a blog or wiki page (this example was also explored by Jason Watson, Enterprise 2.0 QUT lecturer)

2)    Knowledge Retention. Even if the bloger left the company the post will be still there, that is part of company’s intellectual asset.

3)    Improved Productivity. That’s one that I am reluctant to accept, as there is extra time to be expended to post a blog or wiki. However, there is a sample from Oracle support for example where they reduced the number of support calls by stimulating technical employees to blog technical articles (I have already posted about that here)

4)    Better leverage of assets and increased innovation, I get these two from this article but I couldn’t identify any real example. Let’s try to clarify these two points in our discussions.

5) Identifying “oracles”(that doesn’t mean the company Oracle by people who are good source of questions, who offers good answers). That is the best return of investment in my opinion. I can imagine how hard is for a company to identify who are the people that really owns the knowledge, who’s most asked employee. TransUnion is studying usage data to learn who’s best at solving business problems raised in the social network. With that, it’s experimenting with new job descriptions for a couple of them, so that handling  these questions within the forum is a formal part of their role. (see the article).

This idea of identifying “oracles” and creating a role to them is fantastic, and it’s easy to see why TransUnion saved $2.5 million while spending about $50,000 on a social networking platform.

Would you be happy if your company could identify you as a good source for answers?  What if your new role involves bloging and answering forum’s questions 8 hours per day?

References:

http://www.accenture.com/us-en/Pages/service-collaboration.aspx

http://www.zdnet.com/blog/hinchcliffe/determining-the-roi-of-enterprise-2-0/334

http://www.frogpond.de/2009/02/discussing-measures-and-concepts-for-collaborative-performance/

http://www.businessweek.com/stories/2009-04-08/putting-a-price-on-social-connectionsbusinessweek-business-news-stock-market-and-financial-advice

http://www.socialtext.com/blog/2009/03/roi-of-social-networking-for-t/

http://www.internetevolution.com/document.asp?doc_id=173854

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Responses

  1. Hey, really good blog about ways ROI can be calculated, i was so surprised that i didnt think about “Less Waste and Duplication.”

    • Hi.
      In my company I’ve seen reduction in the number of emails and also a lot of duplicated question sent through email has now been solved by some wiki page or blog post. People still send question via email, but there is a tendency to point to the correct blog url or wiki url rather than responding in the email.

  2. Hey Charles,

    I really enjoyed reading this post of yours. The fact that you had put in the extra efforts to contact someone from the industry, shows how passionate you are about Enterprise 2.0! Good job!

    That was really amazingly interesting figures that Accenture keeps track on their employees.

    I very much agree with you, especially on that point with regards to knowledge retention(That was a very good one!). Without the employee being around, the so-called ‘knowledge’/information would still be there, and it would still belong to the company.

    To answer your questions, I would definitely be very happy if my company comes to me could recognise me for good sources. I believe that would boost my motivation to work even harder at work.
    But honestly, if my job scope involves only blogging and answering forums all day long, I would be bored sick! That’s just me, I like to do a wide variety of work.

    Looking forward to your next post next week! 😉

    • Hi Yvonne
      I am glad you enjoyed reading the post.
      In your last paragraph you indirectly help me to clarify the point 4 (increased innovation). Perhaps the employee motivation can be increased from the recognition of his posts or the recognition of his efforts to be a good source of answers.
      Again, employee motivation is hard to measure but that could be considered in the ROI indeed.
      Thank you for adding value to our discussions.
      Cheers

  3. Informative post mate, nice. I like the stats from accenture. Everyone who is anyone knows that they are hugely successful so they have to be doing something right? Enterprise 2.0 is something new that the world does not yet fully understand. ROI for Enterprise 2.0, that’d kinda like asking someone to develop ROI for having a door into your shop. It’s going to be something you just have to have in order to stay competitive and retain customers. It will just be expected.

    • Hi Adam.
      Absolutely. When you said “they have to stay competitive and retain customer”, so they have to follow the E2.0 trend. That exactly the risk of not investing (RoNI).
      Cheers

  4. I like your points on the way to calculate ROI. I also find ‘improving productivity’ a debatable selling point. The organisation needs to find a balance between blogging to improve productivity and spending too much time in producing and maintaining the blog. One can get a bit carried away in blogging and sharing information that they spend most of their time doing that. A good measure would be the amount of time spent blogging should be less than the amount of time spent by someone else searching for the information or finding the solution for a problem.

    Your point in ‘identifying oracles’ is great. In smaller organisations it is easier to identify the ‘go-to’ person. In larger organisations, the knowledge worker might get lost in the background. TransUnion did the right thing putting those staff in a specialised role. Since they are already indirectly helping others, they might as well share their knowledge to a wider audience.

    • Hi Karen
      Thank you expanding the points I’ve described in the post.
      I totally agree that ‘improving productivity’ has a initial investing that’s hard to justify and for many stakeholders that could seems waste of time, but in some point the outcome will show up.

      Perhaps ‘identifying oracles’ should take consideration the company size, because, as you said, for smaller companies the outcome will not be so evident.
      Cheers,

  5. […] 2.0 ROI loosely addressed as a list of statistics rather than the result of a calculation as per Charles’s blog, who discussed […]

  6. Hi Charles,

    first of all, thank you for visiting my blog and leaving a comment. I must say your post shows some excellent research done here. I would like to add to a great discussion by Karen and say perhaps larger organizations are struggling in measuring ROIs because ‘productivity time’ seems to be something that is not well managed. So the idea of identify Oracles would create a concrete view of how much of the working time (8 hours) would have been saved and concentrated more on producing results.

    Cheers
    Thadreina

    • Hi Thadreina
      Definitely, Karen raised a good point about ‘productivity time’. Perhaps, activities like ‘adding a new blog post’ or ‘updating a wiki page’ should be considered as project tasks and officially added to the timetable and project schedule. Therefore, we can identify the time spend more precisely. Are we on the same page?

      • Thanks Charles,

        you actually simplified it even more.

        I believe we are on the same page. hehe

        Cheers 😉
        Thadreina

  7. Hi Charleston, I’ve never thought that the ROI can give the company a qualitative measure as a Knowledge Retention. Is quite interesting of course this is a huge issue that all companies have because when some employee left the company sometimes also the knowledge left. So the intellectual asset is definitely a benefit.

    Referring to your question, I think that being a good source for answers to your company is quite good because you feel comfortable as employee that your thoughts and initiatives are attended, but in the other hand I think that this must be handled carefully so the productivity is not affected.

    You seem to have a lot of knowledge about this topic, anyway I recommend you this link that I’ve also posted in my blog: http://www.youtube.com/watch?v=plM7G223wOE&feature=player_embedded is very interesting.

    • Hi Danny
      Perhaps recognizing the employee as a good source of anwsers can give him a good motivation.
      What if the company give a bonus (payment, money, $$) to those who have given good answers and posted well visited posts?
      I would be motivated that way. What do you think guys?

      • That would be great recognition from management that sharing knowledge is valued and rewarding. If a bonus is the carrot, then the stick might be a key performance indicator for people to be actively involved in sharing knowledge and providing leadership to their role’s community, for example, business analysts may start or contribute to discussions about better storycard breakdown in agile teams.

      • Hi Amanda
        Just adding one more information to your thoughts, the idea of involving BA in StoreCards definition and helping in Service strategy is not new. That’s exactly what ITIL (IT Infrastructure Library) defines for Service Strategy (http://wiki.en.it-processmaps.com/index.php/ITIL_V3_Service_Strategy).
        Cheers

  8. For number 4) in your article about better innovation, it could be ideas from your social medias audiences. “It would be nice if …” for example, ” It would be nice if playing game would benefit our health” and then Nintendo create Wii for gamer that can actually improve your health from playing games. More people we have more ideas from them. We can use these ideas to our own benefits which is one of the ROI we get from social medias.

    Cheers,

    Prapat W.

    • Hi Paprat.
      Thank you for your comment.
      I agree, the same idea captured in a similar area can be used to improve something else. The first idea is just the entry point and from them a full hierarchy of ideas can be derivated.
      Cheers

  9. Hi Charles,
    Excellent article! 🙂

    I would add to your list of outcomes to be considered in ROI is the employee motivation and felling of belonging to the company that incredibly increase their productivity. Indeed, using social media tools empower employee and it has wonderful consequences.

    For your questions on your point #4, I would say that the assets they are speaking about in the article are intangible. For example, the knowledge improvement and retention you mentioned are intangible assets.
    And may be, adopting a new Enterprise 2.0 tool brings some change in the company, breaks the routine and spurs employees to rethink their daily tasks.. That would increase the innovation?

    • Hi Mathilde
      Good point. I like this concept of “sense of belonging”, that’s for sure motivation aspect for employees.

      As per goals being tangible or intangible, I believe depends how agressive the companies will be in their expectected results. The only way to classify as tangible or not will be analizing each case. However, in my view, assets like “knowledge improvent and retention” are totally measurable (my inspiration to defend that came from this article). And in the end that’s what is important for the ROI (measuraments). What do think?


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