Tags: ROI, Return on Investment, Jay Cross, Informal Learning, Social Media, Social Software, Social Networking, Social Computing, Web 2.0, Enterprise 2.0, Collaboration 2.0, Collaboration, Communities, Learning, Knowledge Management, KM, Knowledge Sharing, Learning and Knowledge, Personal Knowledge Management, PKM, KM, KM 1.0, KM 2.0, Remote Collaboration, Virtual Collaboration, Innovation, Connversations, Geek & Poke, Oliver Widder, Knowledge Economy
The end of last week was pretty hectic, as you may have noticed, since I didn’t create any blog posts. Getting started with the new job is surely making things a bit busier than ever, specially with the transition and all, but already I am facing some interesting questions and discussions that I am hoping to be sharing over here as well as time goes by. The latest one of those has been on ROI (Or Return on Investment, for those not familiar with the term) for social computing or as the title of this blog post says: Making the Business Case for Social Computing.
I know that a lot has been written about this particular topic in the recent past. In fact, my feed reader has got tons of related blog posts to this specific subject and perhaps over the course of the next few weeks I shall be referencing them by sharing my two cents worth of comments on the subject. However, I thought I would start up today sharing something that has been in my mind for a long while now on how we can potentially make that business case for social networking.
Whenever someone asks me "What is the ROI for social software?" I am not sure about you, but I always think, and very much so, along these lines:
Oliver Widder’s Geek & Poke just nails it as far as I am concerned, and I am glad to see I am not the only one thinking along the same way. But last week I actually read one other blog post that I thought was just spot on.
It was coming from Jay Cross on a recent online seminar we both attended last week. And although Jay discusses further Making the Business Case for Informal Learning, if you try to substitute Informal Learning and, instead, use Social Computing, it would still be incredibly accurate on how strong I feel about trying to figure out the ROI of social software. But let’s see it with a couple of relevant and meaningful quotes so that you folks get to know what I mean:
"First of all, understand that you’re not buying informal learning. It’s already going on in your organization. In fact, three-quarters of the learning on and about how to do one’s job is informal.
[…] Second of all, a persuasive business case focuses on outcomes, not activities. The measure of success or failure is business metrics, not training metrics. The only meaningful way to assess any form of learning is performance. Are workers doing their jobs well? Is their work challenging? Are workers committed to becoming "all they can be?"
Or this other relevant quote:
"If whatever informal learning intervention you are proposing doesn’t have such an obvious payback that you can explain the value proposition on the back of a napkin, pick another project."
From there onwards Jay gets to put together a number of different examples that clearly detail how businesses should be looking at informal learning and, of course, social computing both inside and outside of the corporate firewall. You should have a closer look as well at the examples put together under "Eliminate Bureaucracy" and "Conversation", because they surely demonstrate the value of social computing, without even mentioning the term ROI just once.
Oh, and for those of you who have been saying that social software is all about conversations, then you should check this quote from that same article:
"Conversation is easily the most important learning technology ever invented. Conversations carry news, create meaning, foster cooperation, and spark innovation. Encouraging open, honest conversation through work space design, setting ground rules for conversing productively, and baking conversation into the corporate culture spread intellectual capital, improve cooperation, and strengthen personal relationships"
Yes, Jay is still talking on Informal Learning, but don’t tell me that if you exchange those words and apply that quote to social networking, it wouldn’t be just as accurate. I know. You bet it would!
And here is the heart of the meat, where Jay just puts together, with some lovely words, how I feel myself about trying to figure out the ROI for social software (And informal learning for that matter, too!):
"In brief, you measure the impact of informal learning the same way you measure the impact of any investment in the organization: by its outcomes. Are people able to do their jobs? Are they challenged? Are they working in top form?
Hold your breath a moment, for some of you will choke on this one: ROI and accounting are inappropriate measures of performance. ROI is a relic of the industrial era, when assets were tangible and repetition was the path to success in the factory. Today, the intangible assets you cannot see are far more valuable than those you can."
If social computing is supposed to revolutionalise the way we share our knowledge, connect with others, collaborate, communicate and innovate, then I think it is about time we move into the 21st century, progress further in that Knowledge economy and try to figure out how to get the most value out of it, because figuring out its ROI, in my opinion, is going to be a waste of time, energy and resources.
12 thoughts on “Making the Business Case for Social Computing”
ROI = Industrial Age, tangibles only
Value exchanges = today, intangibles rule
I really liked the cartoon strip. What I believe is that end of the day, its about the Money! Lets not think its not. Which means that we need to bring up some kind of return on the bucks the management is going to spend.
THe only thing thats different is that today, we are coming to the understanding that water cooler conferences (or maybe those discussions over a few Beers …), are a very important way to share knowledge, and resolve issues, and a simplistic way of looking at Social Computing could be as an online water cooler (minus the Beer?).
Thanks every so much for the feedback comments, folks. Very very helpful and insightful. So much so that I have decided to create a follow up weblog post and share some additional commentary on your initial reactions. Check it out and see what you think. Let’s keep the conversation going 🙂