Perhaps more than anything else these days I’m getting this increasingly urgent question at an senior executive level: What specifically are the business benefits of social media? While I’ve covered that in detail many times, this new-found interest on exact outcomes shows that the business leaders are increasingly feeling compelled to wrap their mind around the inevitable changes facing their organization. To help with this I’ve recently distilled it into the chart you see below, based on the McKinsey data they collect every year from large organizations. These double digits performance improvements then, embody the social business imperative:

Then there is the whole consumerization story that’s unfolding at the moment. This has been a seismic event for many organizations as smart mobile devices, enterprise app stores, and software-as-a-service from the Web all combine to make adoption of the latest apps and IT solutions is just a mouse click or tap on a touch screen. At the same time, there is a growing sense that the classic line dividing IT and business is blurring, just like there is so much blur in many key business boundaries today. The lesson: Everyone can and should be be involved with making these changes happen constructively and effectively for their organization, whether it’s social media, information technology adoption, transformation to new digital business models, etc. Many of you know tat I’ve started to call this confluence of IT trends “CoIT” and it’s something I’ll be researching and speaking about extensively this year because I believe IT is about to change — no, is changing — in a substantial and irreversible way. The changes themselves are largely good but it will certainly leave some ‘creative destruction’ behind, to use the popular euphemism for what happens when innovation cuts through an organization in an unplanned way.

Now that the basic platforms for social business have matured to the point that they’re ready for most organizations — and by this I mean both internally and externally for most common business functions like operations, CRM, marketing, product development, etc. — we’re moving into more sophisticated and higher-order capabilities. Capabilities like social business intelligence, enabled by the rise of both older and radically advanced new technologies now known as Big Data, are making it possible for us to actually make sense of the huge knowledge flows moving around us. I’ll also be closely following analytics, machine learning, natural language processing, metrics, and much more, both in terms of technologies as well as how to best embody them in operational business processes.

2012 is also shaping up to be the year of open supply chains, or as people on the Web call them, open APIs. The number of products and services that are now open to be remixed into other companies’ offerings has exploded in the last year. See this terrific visualization of API growth on ProgrammableWeb to get a sense that something big is indeed happening here. I’m now seeing sustained interest beyond the Internet community by traditional companies that are starting to see how much value they missed by looking at their businesses through like silos, disconnected from the digital rivers of commerce, ideas, engagement, and so on. Open APIs are now officially on the radar of big company CIOs. They are seeing how it will be a significant competitive advantage to offer a compelling API in an industry that does not have strong uptake yet. 2013/14 will start looking bleak for those firms that don’t yet have them, or at least have developed competency in both the technology and business models. In the meantime, the tools, techniques, and business models for making APIs work for a wide range of industry has greatly evolved and will be important to watch.

There’s plenty more I’ll be tracking this year; there’s really no shortage of topics that will be vital for all of us to watch including augmented reality, new mobile technologies like NFC, the rise of HTML5 and its coming battle with iOS and Android, gamification of just about everything, location-based social networking, enterprise OpenSocial, and much more.

2012 Speaking Calendar

In the meantime, my speaking calendar for 2012 has started to fill up quickly. While you can always read the latest on my blogs on ZDNet, ebizQ, the Dachis Group Collaboratory, here, and elsewhere, I’ll also be releasing a major new book on social business that I co-authored with Peter Kim that will be out from Wiley this May. I’ll be writing a detailed blog post about the book soon, but in the meantime, you can get the details here on Amazon. But for those of you that can make any of these conferences, I’ll be sharing my very latest findings at the following events:

• 60 Minutes with Nir Zuk. January 31st. I’ll be having a live fireside-style chat with Palo Alto Networks founder and CTO, Nir Zuk in a Web-broadcasted discussion about how enterprises must make the right policy decisions, in context, to safely enable social media in their organization in order to attain the corresponding business benefits. It’s a free event.
• Enterprise 2.0 SUMMIT, Paris. February 7th-8th This is one of the best enterprise social media events in Europe in my opinion. I’ll be speaking here again for the 3rd time, providing the closing keynote on the 2nd day on “Next-Generation Ecosystem and its key success factors”. I’ve arranged a discount code for my readers from conference organizer Bjoern Negelmann. Use code ‘dhinchcliffe10′ for 10% off the registration fee. I’ll be there both days for anyone that would like to meet up.
• Enterprise 2.0 Virtual Conference. February 16th. I’ll be providing the opening keynote on social analytics at this virtual event. I’ll be bringing with me real case examples, an overview of the latest tools and techniques, and primer on how to get started. You will be able to sign up here soon.
• CITE Conference & Expo 2012, San Francisco. March 4-6th. I’ll be providing the opening keynote on the topic of consumerization and CoIT, which is also the main topic of this conference. In addition, the day before, I’ll be providing a deep dive on how organizations can make it through the era of IT consumerization in much more detail in a half-day workshop. CITE is run by IDG and they are hoping to make this even one of the leading events on the topic.
• AIIM Conference 2012, San Francisco. March 20-22nd. This major event being held by AIIM has an all-star cast including Clay Shirky, David Pogue, Ray Wang, and many others. I’ll be providing the closing keynote on the 2nd day on next-gen mobility and mobile/social convergence. Highly recommended.
• Social Business Summit 2012, Austin, Shanghai, Rio, Berlin, London, Singapore, New York. March-September. This is our official social business conference series for the Dachis Group. It attracts the top thought leaders in the space and is in its 3rd year running. Previous speakers have included John Hagel, Charlene Li, JP Rangaswami, and Dave Gray. It’s invitation-only and most locations sell out quickly, so I’d request an invite now. I’ll be speaking at most of these to promote our new book. Also highly recommended.

That’s it for now, but plenty to mull over. This year we’ll see many of the changes we’ve been tracking that last few years actually happening in the enterprise a widespread way. I’ll be covering them in my blogs and on Twitter as much as possible. As always, I’m interested in hearing from anyone in the trenches making these changes happen in their organization. Happy social business!

The pace of new app development dwarfs the release of other kinds of media. [my emphasis] “Every week about 100 movies get released worldwide, along with about 250 books,” said Anindya Datta, the founder and chairman of Mobilewalla, which helps users navigate the mobile app market. “That compares to the release of around 15,000 apps per week.”

The Web can’t keep up either. Mobile has mindshare now. While classical Web pages made purely of static content still easily beat apps, that’s also not where the value or the action is today. As with any distribution curve, it’s true that much of what is being produced in mobile apps isn’t very interesting or even useful. But that’s not the point; it’s the sheer volume of investment that apps are attracting which means that the high side of the curve is aggregating some of the best talent, and results.

Moreover, there may be no easy way to catch up. A new generation of apps is appearing that takes advantage of the unique abilities that next-generation mobile devices alone usually possess. This includes location (GPS), orientation, images, video, audio, and increasingly, new capabilities like near field communication (NFC). Innovative apps like RunKeeper, StarWalk, and WordLens are only possible because of their deep integration with the rich sensors located in today’s mobile devices. HTML5 is going to address some of this disparity, but not quickly enough to address the tide of defections — and venture capital — from Web apps to mobile apps.

The genie won’t go back in the bottle

The sometimes-blind rush towards mobile apps has begun to concern me. For one, there’s little question that the proprietary element of apps — including their developer APIs, associated app stores, and underlying run-time platform and ecosystem — represents a very slippery slope back to the old days before the broad adoption of open standards (which includes virtually all of the Internet, even today.) That was back when industry giants like Microsoft and IBM called the shots and practically everyone was at their mercy, with independent developers at a distinct disadvantage with the platform owners themselves. There was often little choice and lots of lock-in. The arrival of the Web — and to an almost as large an extent open source — broke the stranglehold on proprietary platforms and put everyone on roughly the same playing field.

Then there is the model of the Web itself, something which has intrinsic properties that make it very, very special indeed. This especially includes deep link structure, which makes search work and provides link addressability to just about every element of information in the world (if it’s Web enabled that is.) After many long years of struggle, we are now finally seeing large companies starting to get the message that Web-orientation is a fundamentally powerful concept, perhaps more important than any computing idea since von Neumann architecture. The Web of pages, data, and even apps creates possibilities for ecosystems, integration, and synergy that’s more profound each and every day after nearly 20 years of continuous co-creation by everyone that uses and contributes to the Internet. All of this is now potentially threatened by the return of platform and app silos, proprietary mobile technology, and the seduction of new single-source forms of monetization of software, combined with a perception that app stores provide consumer safety that just doesn’t exist in the wild environs of the Web (which indeed they can.)

Related: Why The Next App You Use Might Be In A Social Network

To be clear, I’m actually a genuine fan of mobile apps and have hundreds of them on my iPhone and iPad. They are sometimes well-integrated with the Web, but I’m constantly battling the “lock-up” they introduce: 1) I can’t easily copy and paste data in many apps, 2) you frequently can’t link to information, 3) it’s not searchable from one place, and so on. Worse, it’s usually stuck on one platform or even for a single device (I have plenty of iPad apps that won’t run on the iPhone for example.) In comparison, the Web gave us real choice in browsers, search engines, servers, services, apps and much more as well as an revolutionary data architecture that has unleashed the knowledge of humanity along with the social media revolution, which has ultimately given us (everyday people) leadership over the production and sharing of global information. We give this up at great peril.

Can we still get to a good place? Yes, but it’s up to you.

There is a distinct and sharp inclination today towards mobile apps. They are convenient, fast, fun, and always with us. I’m actually mostly for mobility in all its form — especially apps — but it now looks like we may have to re-fight the long and arduous wars of open standardization that got us to the right place with the Web. Like it was before, it will be hard going but worth it in spades.

I should also note that the evolution of the Internet did fall down in a few key places that originally led to the rise of native mobile apps — namely not keeping up with the capabilities of mobile devices and by not introducing a way to make apps as safe, easily distributed, and monetized as say, iOS has. For that, we might pay a very high price indeed; our autonomy, competitiveness, and freedom to choose. Unfortunately, it’s often a zero sum game in terms of the shift in investment: Most Web apps simply must have a native mobile front-end now. That means it costs more to produce or the app collectively does less. Worse, while most mobile apps also have a Web experience, I notice that a growing number of them are using them primarily for support and brochure-ware instead of providing an integrated Web experience. That’s the slippery slope defined.

Where all of this is headed is unclear and there are certainly many people working on unifying today’s Web and mobile devices. However, none have yet hit upon a solution that will be broadly adopted. I’ll explore this topic in more detail throughout 2012, but increasingly it is looking like a very large yet largely silent struggle is brewing between these two vitally important worlds. The upshot: The Web could potentially — in the long-term — become a second-class citizen and I’m very sure that’s not a good thing. Fortunately, in the end, I’m not overly worried about this yet, as the network effect of the Web is just so large. Then again though, so is the growing network effect of mobile devices. I’m certainly not alone in tracking this closely, a good piece by Gigaom’s Matthew Ingram this week discusses how folks like Dave Winer and John Battelle are thinking about the consequences. We all must do the same.

Mobile is just one of the Big Five IT trends that we must grapple with in order to make the transition to next-gen enterprises.

Over the last couple of years, I’ve been following this set of closely interrelated trends, each one that began “out there” on the Internet or in the consumer world, and have little or no roots in the enterprise world. It’s this singular fact that induces in so many IT executives and business leaders a profound feeling of disquiet. Yet the ones I’ve spoken to this year realize that they have to respond to these changes. Why? Because technology innovation today is driven mostly by the Internet or the consumer world, yet technology is one of the leading ways we use to automate and drive productivity improvements in business. High technology — and particularly the fundamental architecture of the Internet — also has an innate tendency to dislocate the old ways of working. It tends to tear down the traditional — yet less effective — means of operation, along with their associated cultures, norms, and expectations. However, it’s fair to say that no one being held to a quarterly earnings cycle or holding a market leading position vulnerable to technology change (media, software, travel, education, etc.) likes to experience dislocation. So it’s up to organizations to get (much) better at realizing an effective digital strategy, just as innovation and change is happening much faster than any other time in human history.

Recently, the phenomenon of “CoIT” has been growing. It’s a new concept that says that the adoption of IT is now proceeding rapidly outside of the CIO budget, often in entirely unsanctioned initiatives by lines of business. In its more mature form, CoIT also stands for a much closer yet decentralized notion of IT where innovation and technology leadership is driven on the ground by the business, yet supported by IT. The business — as well as IT — brings in the latest new cloud services, mobile apps, APIs, data sources, and mobile devices. IT then makes it safe, secure, and manageable, or provides guidelines for doing so. It’s a smart, efficient, scalable new partnership. The former is the “Consumerization of IT” while the latter model is the “Cooperation of IT”. Both are represented by the moniker, CoIT, which was originally coined by Computerworld Editor-in-Chief Scot Finnie a little while back.

Clearly there’s widespread interest in the topic, as one of my most popular writings this year was the exploration of the “Big Five” IT trends of the next half decade, one of which is consumerization, for which it could be argued it’s actually an encompassing supertrend. All of this ultimately culminated in a gracious invitation by Eric Norlin to come and present my research at Defrag 2011, which I did last week.

Below is the deck itself, which I gave as a keynote last Thursday morning:

If you don’t have time to review the deck, the key points to take away are the following:

5 Strategic Points about CoIT

• Evidence is growing that current productivity gains aren’t coming from traditional IT investments. They are coming from somewhere else, or the cost of IT is collapsing radically. Almost certainly both are true by comparing slides 3 and 4.
• There is far too much new tech for any centralized process (like IT) to absorb. New types of processes must be created that can unleash and scale the application of powerful new technologies (next-gen mobile, social business, cloud computing, big data, etc.) to the business..
• If the only real constant is change, change must be in our DNA. But these ‘genes’ are usually not present in large enough quantities in the enterprise. This is the concept of moving from fixed processes to dynamic relationships embodied by the Big Shift in order to transform the enterprise as we know it.
• Some changes will be more transformative than others. While mobility is the hot topic right now, social business and big data will have the largest long-term impact and especially the former will have truly game-changing and transformative consequences.
• Ten to hundreds of times more apps and data are coming soon, get ready for it. Cultivate the skills, create enterprise app stores, build social layers into the organization, define decentralized enterprise architectures (really, business architectures), and create a new CoIT playbook. Or this will all route around you. 30% of IT is already outside the purview of the CIO and growing fast.

I’ll be exploring this more soon with new data and examples. In the meantime, I’d love your thoughts on where you are seeing IT going in a rampantly mobile, social, big data world. In addition, here are 10 strategies for coping in the CoIT era.

“When most people think of Enterprise 2.0, they think of the use of collaborative tools,” Tapscott said. “I’m arguing that something much bigger is happening than the application collaborative tools within the enterprise–it’s a profound transformation of the enterprise as we know it.” Basic principles of organization that have been established over the last 100 years are being upended, leading to “huge changes in how we orchestrate capabilities to create goods and services,” Tapscott said.

Like Tapscott, I’ve long been a proponent, along with thought leaders like John Hagel, that there’s a deep and profound Big Shift taking place as we get deeper into the 21st century. To survive, we must think in deeply networked, decentralized terms now, not in the rapidly receding business concepts of an age bygone. This means platforms instead of products, ecosystems instead of businesses, peer production instead of central production, and networks instead of hierarchies, to name just a few of the more significant aspects of the shift.

But how can traditional organizations get there? Web companies have a hard enough time getting there themselves, as digital natives. Most of them certainly don’t become the next Amazon or Facebook, two companies that virtually embody much of the changes taking place. Instead, I see many traditional firms engaging in the cargo cult mentality, hoping that by adding window dressing like social media, a few APIs, and perhaps some user-generated content, that they too will suddenly have a healthy, sustainable future.

Well, it’s not going to happen that way. The changes required are deep and sometimes painful. In fact, the more I examine the issue, successful transformation to a new mode of existence that naturally avoids the disruption inherent in these shifts boils down to a surprisingly few number of key changes. But those changes, though not generally that complex in and of themselves, are almost impossible to drive deeply into many organizations by virtue of their existing structures and processes. As they say, culture eats strategy for lunch.

Many of you know that I’ve been exploring how to foster social business approaches in large organizations for a number of years. When I see successes, they seem to have much in common with what made things like social media so successful. Yes, that’s network effects but also, and more to the point, about enabling an environment where emergent change can actually take root and thrive. A network effect can’t take hold if everything about the traditional way a business operates is to lock everything down into fixed transactional processes. That just doesn’t work in a fast changing new era where the value is in sustaining dynamic relationships and not fixed transactions.

As JP Rangaswami recenty wrote, it’s now all about “The capacity to change. Designed as an integral function. Native.”

How then can businesses “fundamentally remake” themselves? What critical changes are at the heart of moving from regular business to things like social business? I’ve been exploring the answers to that question recently in quite some detail, but I’d start with these three things:

• Local autonomy. Effective, resilient response to business change can’t only be driven by top-down, hierachies. It’s far too slow, low in innovation, and far from problems on the ground. Restructure the organization so that change along the edge is not only possible, but well-resourced, common, and effective.
• Freeform collaboration. Going beyond Enterprise 2.0 to reinventing the way business models scale and provide value. I’ve previously written about the orders of magnitude cost reductions that are possible and the things they enable, plus how to get there.
• A culture of experimentation. Of the three, this is the hardest. The first two are different; it’s always possible to create a startup culture at the edge of organizations and it’s also possible to drive mass collaboration. We increasingly see it done all the time in large companies, though it takes time to really establish itself in a transformational way. But to get an organization to be fundamentally more accepting of innovation is very difficult to instill when it does not already exist. Some of it is a skill problem, but a lot of it is more systemic. Solving this is going to be one of the great generational challenges of the social business era.

There’s a lot to consider when undergoing the large-scale transformations that businesses must undertake today, but a focus on these core issue will go way towards getting started.

I was struck by how well the early depiction held up, given the evolution of the industry since then, including the arrival of new innovative players at the time (Heroku and CloudFoundry) and the struggles of some of the originals (Bungee). I wouldn’t add or change much about the breakdown, other than to update it around the edges and add some examples:

But as I looked at this, it also occurred to me — as our focus much of the time in business these days is about strategies to deal effectively with the latest disruptive tech — that it’s up to us to have an abundantly clear vision of the big picture of what we’re actually aiming for as a whole. This is particularly true now since the choices we make today on how we build and evolve our businesses will either lead us to 1) break out of the box and thrive or 2) just make incremental improvements that are unlikely to propel us towards a sustainable and successful future.

Key to this discussion is this question: Are we building businesses? Or are we building platforms? Of course the answer to both is yes, but most of us still possess a very 20th century notion of what a business is.

We think of business in very solitary, disconnected terms, where partners can’t rapidly connect with us and integrate their supply chains, where we can’t even readily reuse and build upon what we have ourselves, and most of our data and systems are closed off from us and each other. Unfortunately, we now live in a new time and this is no longer an option. Those days are definitively over. Steve Yegge’s epic and widely discussed rant recently about how Google doesn’t get platforms (and how Amazon does), shows the new chess board that next-generation enterprises must be playing on:

That one last thing that Google doesn’t do well is Platforms. We don’t understand platforms. We don’t “get” platforms. Some of you do, but you are the minority. This has become painfully clear to me over the past six years. I was kind of hoping that competitive pressure from Microsoft and Amazon and more recently Facebook would make us wake up collectively and start doing universal services. Not in some sort of ad-hoc, half-assed way, but in more or less the same way Amazon did it: all at once, for real, no cheating, and treating it as our top priority from now on.

But no. No, it’s like our tenth or eleventh priority. Or fifteenth, I don’t know. It’s pretty low. There are a few teams who treat the idea very seriously, but most teams either don’t think about it all, ever, or only a small percentage of them think about it in a very small way.

It’s a big stretch even to get most teams to offer a stubby service to get programmatic access to their data and computations. Most of them think they’re building products. And a stubby service is a pretty pathetic service. Go back and look at that partial list of learnings from Amazon, and tell me which ones Stubby gives you out of the box. As far as I’m concerned, it’s none of them. Stubby’s great, but it’s like parts when you need a car.

A product is useless without a platform, or more precisely and accurately, a platform-less product will always be replaced by an equivalent platform-ized product.

It’s this last sentence that’s the clicher:

A platform beats a product every time.

In our deeply connected, social, mobile, cloudy, consumerized, and data-driven world, that’s what we must be creating, whether you’re a Fortune 500 company or an Internet startup. Only those with a clue about this will survive the 21st century for very long. Getting there requires real discipline, no cheating (read about Jeff Bezo’s mandate in Yegge’s post above), and minimal compromise. It must be a top organizational priority, especially if you’re a large organization and/or you control large, strategic data sets.

Unfortunately, outside of the Web community, most companies don’t understand how to platform their business, or the urgency. But do it they must if they expect to compete with the new wave of digital native enterprises that will otherwise eat their lunch. Otherwise expect to be run over by Amazon, Facebook, and Apple, and a new generation of platform companies that get it.

For a deeper discussion, please read the “Big Five” IT shifts today, and the 10 strategies I recommend to deal with them and for a detailed exploration of the specific technology and adoption challenges in particular. For specifics on how to platform your business, I recommend Running Your SOA Like a Web Startup and Open APIs Mature Into A Next-Generation Business Model.

However, in reality these relatively minor tweaks are just the proverbial paving of the cowpath through the addition of limited social features such as collaborative sharing, persistent chat, and perhaps some deeper integration with activity streams. Unfortunately, these actions easily fail the imagination test, which is essentially this:

If you could completely rethink your work in a social business world, what would it look like? How would it be better?

To me, this is the fundamental question that organizations must be asking themselves today. Yet, I also think they should do this while going about the aforementioned incremental improvements such as adding basic social layers to their IT landscape. One reason is that this will happen inevitably as more and more enterprise applications and platforms add social computing features and companies proceed along that vendor’s upgrade path. So, while social impinging around the edges of enterprise applications is worth dealing with from a strategic perspective, it’s going to happen largely whether organizations plan for it or not. As such, it’s not likely to make a huge competitive or qualitative difference in the way most businesses perform. That is, unless they start the process of deliberate and strategic social business transformation, such as what IBM and a few other large organizations have begun.

This process of social business transformation will require both advances in social technology — such as the innovations below — as well as changes to the way we do business. Fortunately, one of the great attributes of the larger social business community is that it generally focuses as much on the business and cultural changes as it does the enabling technology. Some of the best discussions I’ve seen on the people aspect of the transition to the social enterprise are from folks like Luis Suarez, Sameer Patel, Stowe Boyd, and JP Rangaswami, who are just part of a much larger conversation about how we remake our organizations for the 21st century.

So, while there are certainly some companies not tracking the sea changes in the world right now in terms of the way we are globally transforming the way we live and work, we’re also continuing to see fascinating next-generation innovations in social business. Let’s take a look at some of them.

Rethinking Workflow, Manufacturing, and Money in Social Business Terms

In just the last week I’ve encountered several fascinating offshoots of the mainstream social business thread. Social business frequently focuses either on social engagement externally or internally on collaboration and social interaction between workers. This is a limiting view, but it’s also where most of the activity and uptake is today. However, as more and more business leaders and entrepreneurs become digital natives, I’ve theorized that the power laws and principles of social business will encourage them to rethink their traditional modes of business. At the same time, Web startups and large software vendors often put themselves out 2-3 years ahead of the market by predicting where their customers will arrive once current trends reach a mainstream tipping point. Then they adjust their product roadmaps to align with this schedule. The combination of these two trends is starting to give us some interesting new possibilities.

I say possibilities, because unlike social collaboration or Social CRM, the outlook and growth potential for these innovation is still unknown. However, it does give us a sense of what’s coming next in social business.

Social BPM

Last week while I was speaking at Sibos, I had the pleasure of speaking on the phone with Sandra Moran from OpenText Metastorm, a leading workflow/BPM product that recently announced the addition of social computing features to its capabilities. Metastorm now enables workers to engage in real collaborative process design, takes advantage of social profiles to locate needed expertise to plug workers into processes in essentially real-time, and has matching dashboards to provide BPM and social analytics. OpenText had this to say about the new social capabilities, which Sandra told me is now available to over a thousand major customers as a standard part of the Metastorm suite:

These new product enhancements help organizations successfully implement business process improvement initiatives by empowering users to become more engaged and productive. Metastorm’s social collaboration tools provide businesses with a highly personalized workspace and unparalleled access to top contributors, enabling them to drive innovation and increase collaboration and improve efficiency among employees. These tools help employees find other people within their organization with specific skill sets required to help them complete their work. Companies can also route work to the most appropriate employee based on individual skills and workload – ensuring the most cost-effective strategy for work allocation.

I think this is significant for a few reasons. For one, I find that there’s often not enough focus in social tools in collapsing the walls between business processes and social conversations. They often run in parallel, side-by-side, even when they are being used simultaneously for the same piece of work. Putting social in the flow of work in highly process-intensive environments should lead to some interesting outcomes. I pressed Sandra on if there was leverage in Metastorm of existing social graphs and networks, and she indicated there was. What remains to be seen is how easy it will be to integrate the resulting BPM environment with an enterprise’s other social business efforts.

I’ll be exploring the social features of Metastorm in more detail soon on ZDNet, but I think the combination of social computing and BPM has genuine potential. This isn’t the first time social and workflow have been connected but I think it’ll be impactful given their large customer base and how central and useful the features are to the product. I’m hoping to revisit how their customers are faring in a year or so to see what the result has been. I currently believe social BPM technology, combined with the right business and cultural changes, will help companies attain a higher than average level of social business transformation.

Social On The Shop Floor

Earlier this month Derek Singleton over at the Software Advice blog wrote about social manufacturing, what you could call a new subfield of social business that’s focused on improving how companies turn raw materials into finished goods. Discussing Kenandy’s new announcement for improving the efficiency and productivity of supply chain manufacturing, Derek wrote:

Creating accessible and actionable inter-shop floor communication can only work if an entire supply chain and other manufacturers are members of, and logged into, Chatter. In short, it requires organizational change for effective use. While manufacturers using Kenandy wait for that changeover, Chatter can be a useful tool for project management. For instance, the engineer of an aerospace job shop could notify shop labor that they’ve just finished designing the wing component of an aircraft. The job shop could then begin building the wing while the engineer finishes designing the other components they’ve been contracted to build. This has great implications for just-in-time (JIT) manufacturing – as it frees up labor to work on more value-added activities rather than waiting for the completion of another phase of the production.

In my workshops at Enterprise 2.0 Conference in years past, I’ve had manufacturers and assembly line managers come up to me to say that social tools have been moving into their area of the business, but it’s mostly been horizontal tools or very focused niche solutions. We’re now seeing broader and more strategic use of social tools with the arrival of solutions such as the Kenandy social manufacturing platform, which has garnered attention in the New York Times. I’ll be exploring this further in coming months to see whether social manufacturing leads to tactical or substantive social business transformation.

The Rise of Social Currency

Finally, at Sibos itself last week, I participated in Innotribe, a social media event inside the main financial services conference that explored various aspects of social media in financial services. For a more in-depth look, I wrote up a detailed exploration of the event on ZDNet on Friday. One of the more interesting and visionary topics at the conference was the subject of social currency, the transformation of the very concept of money in social world where reputation, trust, and openness are prized much more than information control, the latter which is how the financial industry is mostly structured to leverage for gain today.

As an experiment, a social currency called Reputone was actually in use at Innotribe, see picture right. In fact, peer-to-peer monetary systems such as Bitcoin were a hot topic at Innotribe and for good reason, it represents a major shift of control in how banking, money transfer, and investment will work in the future. If Paypal was the first generation of digital money, then Bitcoin is the Web 2.0 version. From their Web site:

Bitcoin is a new digital currency that enables instant payments to anyone, anywhere in the world. Bitcoin uses peer-to-peer technology to operate with no central authority: managing transactions and issuing money are carried out collectively by the network.

Mark Shead recently provided a good overview to Bitcoin concepts and is worth taking a look at. In the final analysis, Bitcoin falls a bit short of being a true social currency, in that it doesn’t have an explicit capital mechanism based on social graphs or other means that leverages the intrinsic worth of social status and reputation. That doesn’t mean it should be watched closely as money and social reputation appear ready to get deeply intertwined and Bitcoin is at the leading edge of digital currency at the moment. This is a subject that warrants a lot more exploration as companies such as Facebook look at making their global platforms far more relevant from an economic perspective. For additional insight, David Armano posted some useful insights on social currency recently on his Harvard Business blog.

I’ll be exploring all of these concepts in more detail in coming months as social business continues to evolve. I would love your questions and feedback on this emerging social business topics below.

The problem lies in our classical views of enterprise architecture and business architecture both. But JP puts it more poetically:

Development backlogs are endemic, as the sheer complexity of the grown-like-Topsy stack slows the process of change and makes it considerably more expensive to change. The stack has begun to fossilise, just at the time when businesses are hungrier for growth, when the need to deliver customer-facing, often customer-touching, applications is an imperative.

Which makes me wonder. What Tainter wrote about societies, what Shirky wrote about companies, are we about to witness something analogous in the systems world? A collapse of a monolith, consumed by its own growth and complexity? As against the simpler, fractal approach of ecosystems?

This fractal aspect of user systems, Web 2.0, and SOA is one that I deeply explored in the 2005-2007 timeframe, and my ideas on this even made the cover story of the SOA/Web Services Journal at one point. This is when we began to see successful, composite systems sprouting up “in the wild” that were eminently natural and highly successful, such as Amazon’s, Flickr’s, and many others. Innovative new open API-based businesses had definitively emerged and shown us — in fact, virtually proved to anyone willing to observe — that business/technology ecosystems could be routinely produced that were far more successful than the ones virtually any traditional business had managed to produce for itself internally with methods like SOA. It was clear something important and new was happening and we tried to learn from it.

The signature lesson in this time period was that being “in the business” of ecosystems, at multiple levels, was the key to resilience, growth, and sustainability. It’s still a far cry from how most organizations are structured today, but I do see the first hints that this is starting to change. Companies like Best Buy and Sears have been getting the message among the old guard firms and looking at integration, partnership, and engagement as an open network activity.

The Web has also shown us that complexity, as important as it is to address and resolve the many inherent vagaries of dealing with the real world, is largely the enemy, whenever it exists needlessly. Our assumptions of where the complexity should be, in the transports for example, was wrong. It was in the ecosystem itself and we paid dearly for half a decade (and running) based on that misapprehension. But we’ve learned. SOAP usage has almost completely shifted to REST, complex WS-* stacks have largely moved on to simple standards and methods like Web-Oriented Architecture.

But technical discussions obscure the very important truths about what we’ve learned in the interim between the “aha” moment when we realized that what was happening so successfully “out there” was something that would make us just as successful inside our organizations, for internal and customer-facing needs both. After all, this holistic ‘integratedness’ — usually triggered via our connections to the Internet — was a part of our businesses increasingly and we simply had to realize this and engage as Internet natives. But back then, Andrew McAfee worried that focusing on the plumbing was the wrong emphasis to have on the exciting changes taking place, and he was largely right from a communication perspective.

However, building fractal architectures that addresses the old and the new isn’t as easy as just deciding to cast off the old, less effecive ways, as JP notes:

What I’d established in my own mind was a growing belief that the issue was to do with rates of change and costs of change. Vertical integration paid off when the rate of change was low. Networked small-pieces approaches paid off when the rate of change was high.

We are clearly living in times of much greater rates of change. Unfortunately, the old systems, the old architectures, the old business “stack” is often running the core of the business. It’s usually deeply vertically integrated, and not made of small networked pieces, loosely joined that are truly agile, deeply harness innovation on the edge, and turn IT into a profit center instead of a cost center.

So, while I have a lot more to say about this, because I believe that social business context will be at the root of the future of our how we design our products, services, processes, and workplaces, below are a few basic rules you can take away that if you stay true to, can indeed help you make the transition to the future. Note that customer and worker experiences are outside the scope of this, this has more to do with the new business stack below the social layer:

4 Ways to Create Sustainable Business Ecosystems

If resilient, networked, recomposable, open business capabilities are the future of business and IT architecture, getting there then requires a substantial change in stance:

• Open Your Business Stack. To everyone, internally and externally, generally in the order of the systems and data that are most often requested for integration. Make it easy for anyone to onboard themselves and use the simplest and most egalitarian technology possible to deeply connect the world to your business. Self-onboarding is crucial because it enables the killer asymmetric business advantage of systems that respond to external engagement best: Export most of the change effort to outside your organization and impose it on those that wish to participate and integrate with you. Enterprises that close the “clue gap” with Big Data will have an enormous advantage.
• Go Into the Business of Ecosystems. Stand behind your open supply chain: Invest in it for the long term, market it, evangelize it, support it, and stand behind it like your customers — again, internally or externally — will be building world changing products and services from them (if you do this, the track record is that they will.) Be fair and generous with your IP and enterprise data; you are under-utilizing it by several orders of magnitude until you do this, leaving much or even most of the potential of your business on the floor. Worse, until you treat it like a business, you won’t get external contributions to enrich your ecosystem that will drive down the cost of change while greatly increasing the velocity of new solutions and local adaptations.
• Begin Fractal Reconciliation of Your Classical Systems. While hanging a trendy Web API off an ancient COBOL accounting system might be a step in the right direction, long-term success will mean going well behind the API. The existing business/IT landscape must be converged and rationalized so they themselves are made of “networked small pieces” that are faster to change as well as more resilient and responsive to being so much more connected (and therefore useful and valuable) to the world.
• Spin Up New 21st Century Business Models. All new possibilities, many of which will be foreign to non-digital native firms, are reachable once you have created a fractal enterprise stack. Dominating classes of data, metered business knowledge, all new monetization methods, and more become possible once the three transformations above have started.

Unfortunately, after having advised and directly assisted many large companies in doing much of what I’m describing here over the years, it’s clear that most organizations are at a major disadvantage in making this transformation. The organizational will required is actually quite low, since most of this is fairly easy to do now with cloud technologies, increasingly capable technology partners, and the latest development stacks. Instead, it’s the understanding of how important it is to kill excessive complexity and focus on ways of thinking about business and technical architecture that will propel companies into bright futures.

We must leave behind vertical integration and radically collapse the size of our seams (APIs) in our businesses, while radically increasing the number of useful endpoints such that we look at them as the very fundament of our enterprises. The benchmark for success is how many others are depending on your ecosystem for their own success. Starting now, the activity in your organization must be focused on optimizing for growth of this number. That is the only way we’ll ensure we’re building businesses that are the most relevant, meaningful, and valuable to us going forward. The enterprises that don’t simply won’t survive in their present form. I believe that much is at stake here. Unfortunately, the “cultural gap” John Hagel wrote of back when this conversation started between the enterprise crowd and the Internet crowd is still much too large and is still hindering the move forward for many organizations.

I look forward to continuing this discussion and exploring just how much we’ve recently learned about the future of business and enterprise architecture.

I once called Chatter an enterprise social operating system and these announcements make it even more true now. Expect that this will significantly improve their positioning in customer engagement as their CRM tool is probably the top product in the space. The move connects their core strengths to social computing even better than Chatter did before, while putting them into the Social CRM business in a significant way.

The new Chatter now has customer groups and social analytics features and more. Larry Dignan did a good round-up of the changes and additions this morning on ZDNet.

It’s very clear with the prominent focus on social business this morning that Salesforce definitely wants to be seen as the social enterprise leader. They’re working very hard to position themselves as such. The confab certainly confirms no small level of market enthusiasm: There are huge crowds in the streets and tens of thousands of folks here.

Though sales automation was Salesforce’s original focus, they are very much moving to become a full spectrum social business enabler. It’s a story all social business practitioners should follow closely and this is a pretty major series of announcements, not just for the products but because the messaging will be heard far and wide in boardrooms and the C-suite.

Liveblogging and analysis of the Dreamforce opening keynote

You can watch it live here and I’ll do some real-time analysis here, so refresh as often as you like. Note: If it’s in quotes, it’s very close to exact wording, otherwise it’s a paraphrasing of the speaker.

9:03 – The keynote is about to start with Marc Benioff on stage shortly.

9:11 – Still hasn’t started yet but they announced it will shortly.

9:14 – Salesforce’s Peter Coffee is announcing a Hawaiian themed opening ceremony, saying Marc Benioff has great appreciation for the state and its culture.

9:19 – Music montage, Benioff is not on stage yet.

9:23 – Benioff is up: “You are now part of the largest technology industry event.” Says 45,000 people in attendance and 35,000 people online.

9:24 – “Salesforce.com was born cloud and have now been born social.” “We want to delight our customers with something new. We’ll look at how Salesforce is helping organizations become more social.” Mentioning Twitter’s #df11 hashtag to follow everything.

9:26 – Talking about the transition from mainframe, to client-server, to cloud. Multi-tenant vision of shared services. Talking about their new philanthropic model. Took 1% of equity, profit, and employee time and put it into a 501(3c).

9:28 – Talking about the evolution of computing, from mainframe, to mini, client/server, Desktop/Cloud computing. Mentions Steve Jobs, everybody claps. “Entering new era, an exciting new era”. Not thanking IBM, not thanking big companies, we’re thanking Facebook that’s creating change and transformation, an “Arab Spring” in business.

9:32 – When will we hear a “corporate spring”, when customers rise up and demand that organizations listen? That’s the social revolution that’s coming. E-mail has eclipsed social networking users. Look at how Facebook is eating the Web. Now it’s all about Facebook.com/yourcompany, your company, your project, etc.

9:33 – It’s not just about social, it’s about mobile. Mobile apps are used now more than Web browsers. Tablets and smartphones are taking over.

9:35 – It’s not just about consumers, it’s about the enterprise. “So, what’s happening, what do we need to be thinking about?” This social revolution has created a social divide. Your customers are social and employees are social. But are our companies? Our are enterprises social? This has really been on my mind since we last met.” It doesn’t matter if you’re in Japan, Russia, or the United States.

9:36 – We want to help organizations bridge that social divide. I’ve traveled more in the last six months than the last six years. This transformation is so important we need to find a new answer. “Think about this:” We’ve been looking for best practices, modeling the success stories, finding the companies breaking through and ask them when they are doing.

9:37 – We’ve come up with a 3 step process. First it’s about the database. You can learn more about your customers than ever before on the network. Step 2, we want to create an employee social network. We’ve been talking about that for several years now. We launched Chatter last year. We’ve learned from you that we need more than that, we need collaboration. It’s not just about another island of collaboration, or island of data, it’s about integrating all your business processes and workflow and applications into that employee social network. Including the sales force, the customer service organization, and including custom applications.

9:39 – Step 3, which was a huge wakeup call. Our really incredible customers were creating product and social networks. Including customers in the social network. It blew us away. We saw you doing this in social marketing, listening, analyzing, deeply in the network. In other words: Social analytics and social business intelligence (my take on this.)

9:40 – We have to step up. Want to excite you, inspire, and look into the social enterprise and take you through the door, a door we’ve locked ourselves. Now he’s talking about Salesforce and the cloud.

9:41 – Your project is portable, your data is portable. Everyone can participate.

9:44 – Discussing their social enterprise research from around the world. Says that their vision of the social enterprise “is inspired by you.” Telling the story about using social networks, travel, and their organization. How in his recent trip to Boston, they talked extensively on their network about their plans, yet the hotel knew nothing about what they discussed. “Delighting customers means knowing who they are and what they like.” Getting that customer database so that they have a great experience when they use your products.

9:46 – We have to get back to our data models, back to the core. Introducing Dan Darcy, VP of product development. Showing a contact record in Salesforce. “Your contacts, they’ve gone social.” The new social customer profile builds an entire picture. Name, picture, where they are geolocated, what apps they use, what deals they are involved in, what customer service issues they have. A deeply integrated view.

9:47 – Says social contacts is really exciting, the crowd claps. Talks about giving everyone the tools to really “delight their customers.” Takes everything from Facebook, Twitter, and public information and streams it into Salesforce. As of today, everyone can go into Database.com, with APIs, OAuth, and start working with this information.

9:50 – You can choose where your data is. It doesn’t have to be in our datacenter, it can be in your data center with the new data residency option (DRO) for those that store sensitive data and it is compliant with many corporate and government policies. Now you have the ability to keep it where you want. Note: This has been a major sticking point for many companies.

9:51 – This sets us up to for something really amazing, really critical. Inspired by Facebook, LinkedIn, and all these networks out there doing collaboration. “Why do I know more about those strangers on Facebook than my own family or employees?“

9:53 – Let’s look at some stories about Chatter. CEOs on Chatter: “This is a change that is going to last forever.” “The conversations really focus around our customers and products, all in one location. How they’re thinking and interacting and that we’re moving in the right direction.” “Instead of wondering how such-and-such is going, now someone whips out an iPad, and says let’s find out.”

9:54 – “It’s a wonderful place to be. I can see using Chatter to really drive changes in our top line.” “Companies that don’t have this collaborative and competitive advantage will fall behind.” “Wherever I can, I can very effectively communicate with 18,000 people in our company.” “The biggest impact in the next 5 years for companies effectiveness will be the use of social media.”

9:56 – Dan claims Chatter has become the leader in employee social networking. “We’re excited to make a series of new announcements” (so far everything that’s in Larry Dignan’s post.) Including Chatter Now, screen sharing for collaboration. We’ve learned that the key to success with social collaboration is integrating social into workflow. Collaboration is not an island. (Note: Great stuff that’s spot on with current Enterprise 2.0 effectiveness discussions.) There is even Chatter for SharePoint.

9:58 – Introducing Kraig Swensrud, Salesforce CMO, to demo the new Chatter features. “Chatter has really started to bridge the divide between different departments.” New features are coming in the Winter 12 release. Sharing stories from meeting rooms, people chiming in, and streaming information back into the meeting. Says customers wanted an open system, says APIs are available for social integration. No word on OpenSocial support (yet.)

10:00 – The Chatter activity stream shows what’s going on in the entire company, “it’s never overwhelming, can be drilled into, filtered.” You don’t have to spam the whole company with questions. You can post something and “the answer finds you.” This is crowdsourcing. Chatter for your entire company means you don’t have to fumble around and find the right system. Including ambient IM, hyperlinks, file sharing is part of Chatter, a killer app we think.

10:02 – We have an amazing social collaboration happening inside our company. “Wouldn’t it be great if we could bring our customers into this process.” Can create customer groups, “user empowerment”. Looks like normal Chatter groups. Shows a group with 12 employees and 3 customers. Says it’s happening today, just with legacy technologies to share proposals, marketing, working on RFPs. It differentiates you as a business to connect with them this way. Customers don’t have access to private and secure company info, just what’s in the group.

10:04 – Kraig is talking about mobile social apps to customers, says all their capabilities work on mobile devices. Demoing the app now. Now showing Chatter working on Android Honeycomb, very cool. “This is the new world of social collaboration, the face of the new social enterprise.”

10:06 – Now going back to Marc. “Now customers can be part of your Chatter network.” They are firewalled off from all your other information. Just introduced Neil Young and is talking about how he’s using Chatter to collaboration and produce his next film. Also using it on their new Hires for the Masses product and more.

10:10 – “Now we’ve been talking about collaboration. But there’s another key part of building your employee social network.” Has been traveling around and getting inspired by his companies. Talking about Groupon visit and seeing the energy level, growing at 22,000%. The way they achieved it by hiring as fast as possible 5,000 sales people. The level of communication and collaboration, planning, logistics is amazing. $750 million in revenue, constant collaboration and building custom apps to support new capabilities.

10:12 – Talking about 150 new features. The big ones are social contacts and social sales. Now they are announcing Data.com, access leading providers of data including Dun and Bradstreet to connect it into the CRM process.

10:15 – Benioff is discussion how HTML 5 is going to revolutionize the mobile user experience. Pinching devices to access fields. They are announcing touch.salesforce.com. All these apps are going to run natively on HTML 5, including all the apps customers have already built are going to be brought forward. Note: I think this is a very smart move to improve user experience on Salesforce.

10:17 – Kraig is back and talking about Salesforce sales features. “Under every deal is Chatter.” Includes support for pricing approvals, sales strategy, mapping out the organization and influencers and decision makers.

10:18 – “Of course, everything is now mobile. This is what you’ve been asking for.” Showing a demo of the new touch site. Looks like a native iPad experience, but is not, all HTML 5. Showing how well the user experience works on touch-based tablets and smart devices. Everything apparently runs in this new interface with little to no rework.

10:20 – Now looking at social customer profiles. “What if I don’t have the information about the customer yet?” Shows how new Data.com services might have what you need. One-click integration of external social information from their partnership with Dun and Bradstreet. Then you can see who they are and what they’re talking about in external social networks. Salesforce clearly understands big data, social media, and the strategic value of data use.

10:22 – Talking about bring the customer into social meetings in Chatter to collaborate and discuss. One final new aspect, everything is integrated in real-time including mobile, so messages are immediate everywhere. Get an immediate Chatter notice “that someone has exceeded their sales quota” right when the order is booked.

10:25 – Marc introduces the president of Verizon Business, Bob Toohey, to talk about shaping the social enterprise. “Need the flexibility to create the B2B to C in a very simplified way.” Benioff asks him how their customers are becoming social. “They want to know more about their customers. They want identity management. Customers want to be able to say I want the flexibility to integrate everything and make it work.” Hints at predictive analytics.

10:27 – Now Marc is talking about the customer they are going to profile this morning, carefully selected so they can learn from it. It’s NBC Universal. Now showing video of talking about NBC Universal’s social enterprise experience.

10:30 – NBC Universal video concludes. Marc: “It was only a couple of years ago that we made a strategic decision to get involved into the customer service business.” Says it’s their fastest growing product line.

10:31 – Talking about Zynga, with 30,000 customer service cases per day. Over 1,000 representatives online. $597 million in revneu, 392% annual growth. Marc’s calling it a “new age company”. Now mentioning Bank of America handling over 1,100 tweets requesting support per day. Twitter.com/Bofa_Help. “An incredible story about a modern bank becoming a social enterprise.”

10:33 – It’s not just about banks. Now talking about airline KLM’s 130,000 Twitter followers, reduced first call resolution rate to 1 hour. KLM’s customer service is “deeply integrated into the social universe.” KLM has taken this “to a level I’ve never seen”.

10:37 – Marc asking if the CEO understands the need to become a social enterprise. Does the C-suite understand? Does the board understand? Do our employees understand? Announcing Chatter Service to enable customer service and taking “the Service Cloud even higher.” Community feeds, suggested knowledge, crowdsourced answers, agent escalation and much more.

10:39 – Kraig is back out showing off Chatter Service in the Service Cloud. “It all started with Twitter. When Twitter started amassing users, everything was public.” Instead of contacting the company, customers just post, hoping that someone will help them in hundreds of millions of users.

10:40 – With the Service Cloud, customer service gets plugged into the social conversations. Showing a live demo of real-time streams of YouTube and other social media and route the issue right into the service center to resolve the problem proactively. Talking about taking all the “paradigms of the social world and plug it into your organization.” Exploring Cirrus computing story with an example of how it all works, including cross-posting resolutions back out to Facebook and Twitter.

10:43 – “Helps you service your customers in completely new ways.” Call center can’t be left behind. “Of course, we’re integrated into telephony”, including the social profile, right when they call in so the agent knows what they are doing and what their concerns are. The knowledge base will recommend the right answer and relay it to the customer via e-mail or telephone. But in a social world we can do something better. Can even do Facetime service to iOS devices. And he’s showing it live.

10:47 – Marc is back and talking about Avon, BMC, Kelly Services are running social apps on Force.com and others creating “breakthrough apps”. Very interesting: Now Facebook’s CIO Tim Campose is talking about how they use Chatter and “have been able to adopt it across the board”. 70% of Facebook’s internal apps run in the cloud and most of them use Force.com.

10:49 – Now Parker Harris is on video from the show floor talking about the exhibits and campground. Continuing to talk about Facetime integration. Invites those to come in and see how all the technologies discussed integrate together.

10:54 – Marc is talking about Step 3: creating a customer social network. “The customer social network has been a real eye-opener for me.” It started with their acquisition of Heroku. Has the Heroku team stand up. Says that it now runs Java, not just Ruby. Talking about Disney’s dynamic social communities. Games, vacation communities, photo sharing applications. ESPN, Best Buy, and Warner Brothers are all doing this and using Heroku technologies. Now with Heroku with Java and frictionless scale, availability immediately. Brings 6 million Java developers right into their social platform.

10:57 – Talking more about social marketing. Now having MC Hammer standing up in the front of the crowd. Now MC Hammer is actually saying pretty good sound bites about how the wall is coming down in enterprises. Social universes can be used to see if products “really resonate.” Relating his experiences with crowdsourcing ideas in the music industry, and using betas to strategically validate ideas with customers. What’s working, not working, and making changes dynamically based on social feedback loops.

10:59 – Marc is now bringing up the great (but now fairly old) story about Gatorade’s social media network operation center. Video is playing about their story.

11:01 – Here’s the exciting part of the confab for me: Discussing the Radian6 acquisition, social media analytics, and how it turns into social business intelligence. Half of the Fortune 100 uses Radian6 to analyze social media. “The beginning of the marketing cloud”. Demonstrating Heroku and Radian6 with a Disneyland app. Companies are creating social experiences and doing it on Facebook to create phenomenal customer experiences.

11:08 – Still demoing social customer experiences. “The next generation of listening and engagement. Marc is back up. “Most exciting part of the keynote. Going to talk about an incredible new capability.” A new product called “Product Social Networks”, will affect every company in the world. Showing a video about the Burberry CEO Angela Ahrendts about how to create a “consistent feel for customers regardless of how they were accessing the brand.” For any CEO that is skeptical, she says “You have to [do this]. You have to have a social enterprise. Otherwise I don’t know what your business model is in five years.

11:12 – Now Angela — who is actually here — is up talking about the borderless enterprise is the future. Talking about the Burberry Community vision. They want to bring together their “great customers”, suppliers, partners, into a social enterprise. “What is the next step?”, asks Benioff. “How do you plug all of this back into the existing infrastructure?” says Angela. None of that goes away, Salesforce is an addition to plug it all into to optimize the social enterprise. As a global luxury brand, and the brand is the #1 asset, is what they’re selling before they sell anything else. The opportunity to take Chatter and brand it completely as Burberry is the key for them.

11:17 – “It’s not about channel, it’s not about technology, it’s about wherever the customer goes.” – Angela. She looks at the audience, “you are the social revolution.”

11:19 – Marc is talking about Toyota and the social enterprise. Relating the story about Toyota Friend, and how they are using that as the first part of their transition to the social enterprise. Connecting dealerships, customers, distributors, support centers, and even vehicles together socially. “Get your cars running on these social networks.” Now they are going to show Toyota Friends actually working so the user can see the charge level, maintenance cycle, tire pressure, interior temperature, etc. All information streams to you in a chatter feed (great stuff showing how devices and sensors can be social as well.) Connects to the whole family of cars and can be extended out to Facebook, Twitter, and so on.

11:24 – Continuing the Toyota Friends demo. Not just for customers, dealers, but also internal employees of Toyota. Marc’s back up, saying “this is happening to companies all over the world.” Discussing Enterasys and how they redesigned their products to be social. “Their switches are social.” Users receive real-time alerts.

11:26 – Coca-Cola is now being featured on how their rewards, events, and other communities including food service, mobile payments, and other capabilities to brought into a single social enterprise experience. Marc is now standing by a vending machine and uses his iPhone to get a loyalty point for standing in front of the machine using geo-location. “It starts to have a relationship with me. We can bring the offline world online and increase customer intimacy.”

11:27 – Bringing up the CTO of Coca Cola, Alan Boehme, and talking about the vision for Coca-Cola and the social enterprise. Where have you said “wow, this has really opened up for me.” Over 700,000 partners and colleagues around the world. Their big challenges: Who’s know who, who knows what, and who know who that knows what.” Technologies that bring people together creates major opportunities.

11:29 – Marc is taking about a new social enterprise license agreement so that per-user pricing delivers every product for every employee. Alan inspired them to create the new social enterprise licensing agreement.

11:31 – Wrapping up now, talking about transforming and “igniting” organizations around employee social networks, customer social networks, and product social networks. Eric Schmidt, Vivek Kundra, and Metallica are all coming up today and tomorrow.

Summary: Overall an impressive amount of messaging and pretty spot on for the most part. We definitely get a better sense of where their social strategy is going as well as the larger outlines of how they’ll be going to market with this. Frankly, I’d be worried if I were a lot of social software vendors, because of the deep cross-product integration, opening of the platform, and the sheer number of key, strategic features now operational for true social business. If I were a CIO considering the social enterprise, I’d now be including Salesforce in my short list. I’ll be analyzing this more on ZDNet, the Dachis Group Collaboratory, and elsewhere soon.

Standout areas of focus in this report include 1) an emphasis on dealing with exception handling as the norm in collaborative environments, 2) an underscoring of the central role of the CIO, which is something I’ve seen as key for success in social business, and 3) last — but certainly not least — positioning social media to directly support ongoing business processes. Says Sameer:

One thing enterprises have learned is that siloed, standalone consumer Web-style microblogging or social networking tools rarely work well inside an enterprise. Social technology that’s embedded in the enterprise application environment to offer collaborative support to specific business processes, or explicitly targeted at unifying all communications and collaboration, can be much more useful.

If you’re not sure about this, the importance of connecting social business to workflow was clearly driven home this week in the discussion that Laurie Buczek sparked in the Enterprise 2.0/Social Business community. See the comments and pingbacks in the link for details but it’s clear the social media for its own sake just isn’t enough to drive significant business impact.

For me, it’s become abundantly clear that smart social business initiatives — and the ones that will ultimately have the most success — will focus on connecting their efforts directly with 1) meaningful line-of-business activities and/or 2) transforming and integrating the most important horizontal functions like the intranet, content management, and document management.

But PWC’s report and Laure’s noteworthy post were not the only significant happenings this week. Earlier today Ray Wang published an engrossing and significant overview of 43 Use Cases For Social Business. Maps like this are important to help those trying to understand how to apply social media to various parts of their business. Ray’s use cases cover the gamut of the following areas:

• Public relations/ marketing (PR/MA). Key impacted business process: Campaign to lead
• Sales (SFA). Key impacted business process: Lead to deal
• Service and support (CSS). Key impacted business process: Incident to resolution
• Projects (PBS). Key impacted business process: Kickoff to delivery
• Innovation/ product life cycle management (PLM). Key impacted business process: Concept to production
• Supply chain (SCM). Key impacted business process: Sourcing to acceptance
• Human capital management (HCM). Key impacted business process: Hire to retire
• Finance. Key impacted business process: Invoice to payment

I DM’d Ray and indicated I felt that this was just a start on where social business will have an impact and he agreed. The list is light on general purpose workflow/collaboration, but then again Ray’s view here is actually connected to specific business activities, as per the previous discussion. We should also keep in mind that Ray’s perspective is based on actual data gathered from those engaging in social business, which makes it particularly invaluable as a look at ground truth. I especially liked his chart on the top 20 use cases based on the responses of over 100 early adopters:

Ray and his team has been doing some great research lately and I look forward to watching what they put out next.

The Disruptive Business Landscape Adds Big Data, Algorithms

As enterprises get backed farther into a corner by the constant changes swirling around them, there’s been a lot of speculation about the root causes of disruption at present. Everyone knows that cloud, social, mobile, and now increasingly big data, are to blame, but are they really the whole story? Not by a long shot in my book and Michael Fauscette agrees.

Citing the usual suspects, Michael took a fairly deep dive this week into the additional forces that are remaking the way we work and operate our businesses and came up with some gems that paint a fairly complete picture. I’ve taken a shot at describing the macro changes several times in the last year or so, but Michael’s list has a great perspective. Be sure to read it yourself, but Organic Business Networks was the one that resonated most with me.

For my part, I think the BBC’s When Algorithms Rule the World adds the final item of serious competitive disruption to both our lists. Will we truly be smart enough to rule over them while only reaping the benefits? I worry that we won’t and that few of us are putting enough thought into the implications of big data and the analytics that will pervade just about everything we do. Next-generation enterprises will be ones that own their classes of data while being able to maintain the highest leverage over what they know that others don’t. See my discussion on closing the “clue gap” between what most enterprises can do today, and what tomorrow’s leaders will be able to do.

Finally, as Web technology continues to provide an ever-growing force multiplier that’s placed into the hands that master it, I’ve been exploring one of the new leading edges of social business: The process of extracting strategic intelligence from the knowledge, connections, patterns that become much more visible when organizations become social. It’s a topic that’s growing central to the discussion of ROI as well as attaining long-term competitive advantage. You can see all the details at Harnessing Social Business Intelligence: Nine Strategic Uses and Social Business Intelligence: Positioning a Strategic Lens on Opportunity.

At Dreamforce in San Francisco this week

I’ll be in downtown San Francisco for Salesforce’s massive and increasingly influential Dreamforce 2011 conference from Tuesday onward. Expect pictures, videos, and blog posts in my Twitter feed as we see what they have in store for the social enterprise. I’ve been having discussions with a number of Salesforce partners this week that are announcing innovative and intriguing add-ons and support capabilities for Chatter and other elements of company’s growing and increasingly impressive ecosystem. I’ll cover as much as I can here and elsewhere. It’ll be a great week of conversations and moving the thinking forward in this fast moving space, even as social business tries to keep pace with social media.

The big failure of social business is a lack of integration of social tools into the collaborative workflow.

I should be clear that it’s not social business as a concept that’s the problem here. It’s that social must be connected to the day-to-day work that takes place. Unfortunately, most work today is done through existing systems that aren’t very social. If we’re lucky, we can forge a link to a piece of enterprise data from within a social tool, a basic requirement for social collaboration. But more likely we have to manually copy information from the systems of record in order to collaborate on it. Even more likely, the social business environment just becomes a parallel silo that’s not connected to the business and is used for light conversation and status updates instead of meaningful, high value line of business activities.

Yes, many large ERP, CRM, and HRM vendors including Oracle, Salesforce, IBM, Saba, and many others have either added or are otherwise incorporating social layers in their products that can help address this. But this is not necessarily the same as making our businesses fundamentally or more meaningfully social. Such duplication of social tools has its own silo issues and ultimately, rolling out social software on its own does not in itself produce results. No, the ladder of social business maturity requires more from us than that.

Instead we need to wrap our businesses in social in a more ambient and deeply connected manner. To work, this must be more than for example merely adding threaded conversations to our systems of record. It’s about weaving collaboration into everything we do, efficiently and simply. The good news is that there’s now hope to readily address what Laurie was referring to and connect social to workflow. With recent advances like real, mature, standardized social integration with OpenSocial 2.0 — with widespread support by enterprise software makers for the first time — there’s a genuine opportunity, right now, for us to connect our daily departmental and enterprise-scale work activities en masse to an overall social fabric that enables real change, real results, and real ROI.

Note: I do not think pure technology can ever be the full answer to this issue. But whenever we have a means of much more easily putting social in the flow of work we must go well beyond paper strategy and employ them.

So it’s up to us to see the importance of doing this and making it happen. Want social business become just a fancy chat tool in your organization? Don’t put social business to work. Do you want to unleash untapped worker potential, including cognitive surplus, peer production, and collective intelligence and all the big strategic buzzwords? Then put social business to work. The big lesson here: Failure to connect social business to work on the ground will pretty quickly result in limited value. We are now in the possessions of techniques to avoid this and we must use them.

See my writings on connecting business software to systems of engagement, social networking applications, and social app stores for more details on this subject. The Social Business CIO Shortlist can help as well.