The Global Human Capital Journal

Chief digital officers and transformation will go hand in hand as the position and its competencies take shape over the next few years. Historically, commercial, government and nonprofit enterprises, when faced with profound business change or technology disruption, respond by  elevating new types of leader to the “C” level. Chief Knowledge Officer, Chief Process Officer, Chief Ecommerce Officer and the like become de rigeur for a few years and fade, either because the new disruption proved less sustainable than anticipated or because the competency became subsumed by a more core function.

I predict that the Chief Digital Officer (CDO) will play a vital role at most organizations through 2020, but the organizational role will be fleeting as a standalone. “Digital” will integrate all functions and be the standard eventually, but organizations require intense transformation to get there, so the CDO will play a crucial role. My ongoing analysis of social business adoption indicates that the market for social business transformation will hit an inflection point by 2017, as more advisors and executives see the power and results of digital communications and collaboration.

The Chief Digital Officer is a powerful locus of attention, but current thought leadership reveals a lack of clarity about “digital” and the CDO role; moreover it unknowingly discounts the transformational potential of social business, both of which I’ll address here.

The Gartner Chief Digital Officer Model

Gartner’s Mark McDonald proposed four “types” of CDOs as defined by revenue accountability and organization. He made the excellent point that the “digitization” process will vary with the type of organization, how it currently uses digital technologies and what kind of business it is/how it generates revenue. Here I’ll touch on Mark’s model for four types of CDO before suggesting how each can best use social business for organizational transformation. The “often used by” parts are my interpretation. I encourage you to read Mark’s post.

The Chief Digital Revenue (Sales, Ecommerce) Officer

• Focus: driving new and incremental sales/ecommerce revenue from digital technologies; runs the digital part of a business/brand with revenue accountability.
• Often used by: organizations that have significant digital operations that they want to expand in depth, breadth or both.

The Chief Digital Champion Officer

• Focus: disrupting a business/brand from the inside, using digital technologies, processes and programs to create new capabilities, often within a new digital unit.
• Often used by: any business/brand that wants to disrupt itself from the inside.

Chief Digital Marketing Officer

• Focus: driving new and incremental marketing/promotional revenue through other business units; uses digital technologies to create new customer experience, and has revenue accountability.
• Often used by: organizations that have significant digital marketing operations that they want to expand in depth, breadth or both.

Chief Digital Strategy Officer

• Focus: disrupting the enterprise from the inside, using digital technologies, processes and programs to create new capabilities.
• Often used by: enterprises that want to disrupt themselves from the inside.

Social Business Transformation of the Enterprise

There is broad consensus that “digital” encompasses four competencies: mobile, social, ecommerce and big data/analytics. Of course, the relative importance of each competency will vary with type of organization and the business it’s in, but I’ll argue that social, since it digitizes communication and collaboration, is the most broadly transformational competency. All organizations depend on communication and collaboration to create value, and digital social has shrunk the cost of both by an order of magnitude. Few organizations have discovered how to reorganize to unleash the power of much faster, cheaper communication and collaboration, which has kept social off the radar so far.

Since very few analysts, consultants and executives have seen digital social transformation from the inside as I have, thought leadership underweights social. Of course, by “social,” most authors assume “social media,” which is far less transformational than social business; social media simply uses social technologies as a new channel for content distribution, promotion and marketing. That is evolutionary, not revolutionary.

By prioritizing transformation and disruption, we can shrink Gartner’s four types of Chief Digital Officer to two, and I’ll propose that their differences won’t often matter in practice.

From Four Chief Digital Officer Types to Two—Then to One

By prioritizing transformation and disruption, we can shrink Gartner’s four types of Chief Digital Officer to two, and I’ll propose that their differences won’t often matter in practice. I’m not saying that the others don’t matter—all will create intense value for various organizations—only that transformation makes two of the four most relevant.

Of the four digital competencies, ecommerce, mobile and analytics are already part of digital operations at many companies, so many CDOs will be necessarily focused on evolving, scaling and managing digital operations. Their charters will be repositioning digital within the organization, making it more strategic and powerful relative to other capabilities. Any of these three competencies can drive profound transformation of organizations, depending on their business and current use of the competencies.

However, the “social” competency, since it refers to social media, addresses transformation superficially at best. Organizations aren’t even in the social business transformation ball park.

Moreover, social business, since its transformation journey involves discovering, engaging and scaling new relationships with customers, clients, partners, employees and other stakeholders, requires a significant learning curve. Its value is grounded in relating to stakeholders in new ways, not technology skills like big data or analytics. Social has the most profound disruptive potential of the four digital competencies when it is approached as social business.

Each situation is different, but generally, we can shrink the four types of CDO into two:

CDO Type One: Evolving Digital Operations

This CDO adds clarity and scale to existing ecommerce, mobile and analytics operations, whether marketing-oriented or sales-oriented—at the enterprise or business/brand level. This type corresponds to Gartner’s Chief Digital Revenue Officer and Chief Digital Marketing Officer.

Depending on the business and its experience with digital prior to hiring a CDO, any of the four can be pivotal. Social business can be profoundly transformational in any business.

• Ecommerce: CDO focuses on integrating social and mobile, mcommerce and analytics to grow the ecommerce/mcommerce business. Growing digital will be pivotal to enterprises whose non-digital businesses are shrinking.
• Mobile: can revolutionize sales, service and even product/service development, depending on the business. Discover, experiment and scale how to engage smartphone-enabled stakeholders.
• Big Data/Analytics: most organizations have been collecting digital data for decades, but new technologies are enabling them to knit data together and derive new insights into demographics and individuals. The first level of value is often creating and delivering more “personalized” marketing and sales messages.
• Social: can be approached as social media, as it is currently at most organizations, or social business. Many brands already have significant social media operations. The Upgrade Social Media use case details how to mature social media into transformational social business. The Herd the Cats use case shows how to improve business returns of several business units or brands.

CDO Type Two: Transforming the Enterprise with Digital Social Business

This CDO has an explicit transformation/disruption focus at the enterprise or business/brand level. It corresponds to Gartner’s Chief Digital Champion Officer and Chief Digital Strategy Officer.

• Gartner’s model specifies that these types “transform” the organization. Reading into the context, I’ll hazard that each of these CDOs uses social technologies to transform passive, isolated relationships with stakeholders (customers/clients/users, partners, regulators, employees, communities…) to active collaborative relationships.
• As I proposed in the Transform the Enterprise use case, explicit social business transformation operationalizes through a Social Business Competency Team under the CDO that builds social business competencies iteratively and spreads them throughout the enterprise via mentoring. Therefore, whether the CDO is housed at the enterprise level or within a business unit matters little.
• Any organization that explicitly approaches social business as transformation will not keep it within any business or brand because it is so fungible.
• Using the SBCT and transformation approach enables organizations to begin transformation anywhere and achieve enterprise transformation as a function of conditions and results. They should begin social business transformation in the optimal part of the organization, where stakeholder adoption is highest and organizational resistance is lowest.

“Social” Will Require Intense Focus to Achieve Best Results

My experience advising global businesses on social business strategy and execution consistently shows that, when organizations use a relationship-focused approach, they create new opportunities to reinvent themselves from the ground up. When they learn to use social technologies to discover, create and scale trusted relationships with stakeholders, collaboration and innovation increase sharply. These drive profit.

Therefore, it follows that It will be more difficult for CDOs to transform businesses or enterprises with social business when they have significant operations management accountabilities. Transforming with social is complex and not a part-time job because it is often disruptive, and the CDO will need to orchestrate transformation so s/he creates new profit without negatively impacting legacy revenues in the meantime.

It will be more difficult for CDOs to transform businesses or enterprises with social business when they have significant operations management accountabilities. Transforming with social is complex and not a part-time job.

Social Business Transformation for Chief Digital Officers

Here are general recommendations for how each type of CDO can use social business for transformation. All refer to the Social Business Life Cycle.

The Chief Digital Revenue (Sales, Ecommerce) Officer

• Focus on transforming your brand’s/business’s vision for “customers” or “clients” by using social to learn about the outcomes for which they buy your product or service. Strategy will provide the basis of your social business strategy, which will call for several social business pilots to test the strategy and start developing your team.
• As you learn about their outcomes, evolve your messaging from product-centric value propositions to customer outcomes, and engage with customers around outcomes. This will usually involve realigning many functions because their DNA is product-centric, and they have promotional attitudes.
• As your internal social business capabilities grow, consider “taking back” social media operations you have outsourced to your agency(ies).
• Opportunistically tone down promotional messaging and attitudes toward customers, and morph to a more collaborative stance.
• If you are having some success with mcommerce, mobile social and social media, continue these initiatives while you are evolving your customer/client relationships.
• More information in Building Post Product Relationships in the Social Channel.
• Use the Upgrade Social Media use case to begin evolving social media into social business in order to boost revenue and transformational potential. If you are in a business that has lagged its peers in social media, use the Catch the Leaders use case.

The Chief Digital Champion Officer

• Begin transforming your business/brand from the inside by developing a holistic view of stakeholders; they might be clients/customers, channel partners, employees, contractors or other influencers.
• Ground your stakeholder understanding in their outcomes, which govern why they work with you (partners) or buy your product or service.
• Conduct Feasibility, Strategy and Pilots to develop insight and build your SBCT iteratively or upfront.
• The key to mitigating the risk of transformation is developing repeatable processes with real business results as quickly as possible, scaling them and finally unplugging legacy processes when feasible.
• Transformation will enable you to redesign many of your business processes and harness new types of collaboration with stakeholders. This will lead to new sources of open innovation and profit.
• Depending on your CEO’s sense of urgency, use Herd the Cats (if your business has several social media initiatives already) or Transform the Enterprise use cases. You will find Catch the Leaders helpful if your firm has had minimal social media experience.

Chief Digital Marketing Officer

• Focus on transforming your enterprise’s vision for “customers” or “clients” by using social to learn about the outcomes for which they work with you or buy your product or service. Strategy will provide the basis of your social business strategy, which will call for several social business pilots to test the strategy and start developing your team.
• As you learn about their outcomes, evolve your messaging from product-centric value propositions to customer outcomes, and engage with customers around outcomes.
• If you are having some success with mcommerce, mobile social and social media, continue these initiatives while you are evolving your customer/client relationships.
• As your internal social business capabilities grow, consider “taking back” social media operations you have outsourced to your agency(ies).
• Opportunistically tone down promotional messaging and attitudes toward customers, and morph to a more collaborative stance.
• Consider the social business model, “Service as Marketing,” in which you collaborate with “customer service” to solve problems in public and commingle the solutions with product/service information.
• Consider the Digital Events social business model, which reinvents physical events such as festivals, trade shows, conferences or symposia.
• More information in Building Post Product Relationships in the Social Channel.
• Use the Upgrade Social Media use case to mature social media, or Catch the Leaders if your business is far behind, or Herd the Cats if your enterprise has numerous social media initiatives whose revenue contribution you want to increase.

Chief Digital Strategy Officer

• Begin transforming your enterprise by developing a holistic view of enterprise stakeholders and social business adoption across your enterprise and its businesses/brands. Stakeholders might be clients/customers, channel partners, employees, contractors or other influencers.
• Conduct Feasibility, Strategy and Pilots in the enterprise context to develop insight and build your SBCT. Launch the SBCT as early as feasible.
• Ground your stakeholder understanding in their outcomes, which govern why they buy your product or service.
• When your SBCT has run 3-5 pilots, evolved the social business strategy, built their digital collaboration space and developed some social business competencies, opportunistically engage one of your businesses/brands that Feasibility found to have high social business potential, as a function of its stakeholders’ social business adoption.
• The key to mitigating the risk of transformation is developing repeatable processes with real business results as quickly as possible, scaling them and finally unplugging legacy processes when feasible. In this case, you are scaling enterprise social business (with the enterprise as client) as well as across your businesses/brands.
• Transformation will enable you to redesign many of your business processes and harness new types of collaboration and innovation with stakeholders.
• See the Transform the Enterprise use case for more information.

Additional Resources

• References (chief digital officer and transformation thought leadership)
• Social Business Opportunity for Chief Digital Officers
• Russell Reynolds Digital Transformation

The post Chief Digital Officers and Transformation appeared first on Christopher S. Rollyson and Associates.

This post originated at CSRA's blog. Please share your thoughts and comments here. Thank you.

Advisory & Services Firm Social Business Adoption 2012 is a research survey that looks at social business advisory/consulting firms in a new way. Using quantitative methods, I compared consultants according to the needs of clients who want to transform their organizations with social business. The twelve metrics measure firms’ performance in business impact, sociality and transformation areas and rank firms within firm categories and overall.

Now prospective clients can compare Strategy firms, Big Four firms, Agencies, Analysts, Enterprise I.T. firms and Pureplays quantitatively. Moreover, consulting firms can use these metrics for guidance in building out their social business practices.

I launched CSRA in 2006, and we have always practiced social business as transformation. Client work in social business transformation enables me to see where the market is going, so this survey considers social business firms from that future state.

[UPDATE 8 Mar] Now available: “Executive Briefing” is even more summarized (14-slides) in two versions: Guidance for Clients and Guidance for Firms. Research survey results will be most useful if you follow the links to understand the survey design and methods.

Research Survey Outline [Updated 11 Mar]

Background

• Background outlines research survey design principles, mission, method and definitions.

Rankings

• Top10 Social Business Overall Rankings shows firms across categories according to their overall scores; Overall sums Practice and Leadership scores, which are more useful guidance for selecting an advisory firm/consultancy.
• Top10 Social Business Practice Rankings compares firms in two areas of practice: their social business transformation services and how they use social business themselves.
• Top10 Social Business Leadership Rankings reflects firms’ commitment to social business as transformation based on their thought leadership, case studies and other artifacts.

Interpreting Results

• The Social Business Life Cycle shows the different phases of clients’ adoption of social business for transformation. Advisory firms are strong in some parts of the life cycle and weak in others.
• Social Business Use Cases are business situations in which most clients find themselves; different use cases also map to different parts of the Social Business Life Cycle.

Using Results

• Guidance for Clients gives summarized guidance to executives of commercial, nonprofit and government executives for evaluating advisory firm categories and individual firms.
• Guidance for Advisory Firms summarizes recommendations for developing a firm’s social business practice and competencies to be aligned with the market.

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Research Survey Executive Summary

Background

(UPDATE 11 Mar] I am accommodating the excellent feedback I’ve received by tweaking the structure of this Executive Summary and adding to it slightly. This will help most first-time readers to understand the rankings better.

Mission

• Educate clients and firms about the importance of social business 
Practice in firms’ ability to guide clients’ social business-led transformation
• Introduce metrics for social business that distinguish it from social media
• Highlight the growing need for organizational change to unlock organizations’ value from social business

Method

• Designed metrics to measure firms’ capabilities in advising clients on social business-led transformation of organizations
• Created assessment workflow and use case in which a client team evaluates advisory firms for their ability to advise on social business-led transformation
• Selected firms based on public commitment to social business as transformation
• Applied workflow and metrics to evaluate firms’ main domains, linked social presences, and related public data
• Analyzed data, and created Overall, Practice and Leadership rankings
• Interpreted rankings and wrote advisories for clients and firms

Definitions

• Leadership rankings show firms’ commitment as reflected by their public content
• Practice rankings emphasize firms’ social business practices

More

• Survey design explains how I designed the research survey, my and how it works.
• Point of View makes explicit my interpretation of how the social business transformation is developing as a practice.
• Definitions for a fundamental concepts such as “social business” and “social media” and Rationale explains how they are treated.

Top10 Social Business Overall Rankings

Overall scores combine Practice and Leadership scores, which are then ranked here. Due to its importance in the mission, Practice is weighted more heavily than Leadership (has more points). Overall is useful because it reflects firms’ overall investment in social business as transformation. This is important because most clients and advisory firms still practice “social” as marketing and promotion.

Dell, Forrester and Salesforce.com hold the Top3 Overall scores. The Top3 all practice social business on behalf of themselves, which is important because social business is integrated into their cultures and creates a well of potential expertise. However, that does not mean that they are effective advisors of other firms. For example, Analysts, as a firm category, are limited to addressing Feasibility and (some) Strategy parts of the Social Business Life Cycle, so Forrester, IDC and Gartner will not be relevant for most social business initiatives. Analysts produce extensive research on social business and transformation. They understand and write about organizational transformation.

Note that Pureplay firms’ strong representation here is mostly due to their strong Practice scores, while Analyst and Enterprise I.T. firms are largely driven by Leadership scores. The maximum possible score was 97, so the top scores fell one third short of it. Much of the Top10 barely made it halfway. There is room to grow.

The prospective client’s business context is a major determinant of ranking advisory firms, and it will be discussed below in terms of social business use cases and the Social Business Life Cycle. For example, a prospect that seeks an advisor for organization change would have a different Top3. Dell is a poster child for practicing social business itself, and it has explicit “social media professional services” that currently focus on Pilot, not transformation. To Dell, “transformation” means I.T. spend first, which may well not be appropriate for some clients. Salesforce and Infosys have similar profiles to Dell’s—without the explicit social business consulting services.

Accenture and IBM house independent management consulting practices with deep and broad expertise, so they would be alone in the Top10 if the client needs heavy lifting management consulting, as “transformation” implies.

SideraWorks, Dachis Group and SxD (SocialxDesign) are social business Pureplay firms that were launched to help clients use social technologies to interact more meaningfully and transform. They could be top picks for clients that want to “try social business” (without transforming) because pureplays are limited in the depth and breadth of their services. In addition, Pureplays’ Practice scores are some of the best, and they are more likely to be using emerging techniques than established players, which can be relevant to some firms’ stakeholders.

Top10 Social Business Practice Rankings

Top10 Practice reflects advisory firms’ prowess in two key areas: the maturity of their stated social business advisory services and their observed skills with using social business themselves. Its metrics are: Practice Definition, Social Business Life Cycle, Sociality, Point of View, Leader Blog, Interactivity and Personability. These metrics quantitatively evaluate advisory firms and roll up to the Practice score.

Note that Pureplay, Enterprise I.T. and Strategy firms were the dominant category in Practice. I hypothesize that this stems from how these firms monetize: Enterprise I.T. is focused on pull-through of their legacy products and services; Pureplays focus on social business advice; Strategy firms understand enterprise transformation due to market change, so they perceive an opportunity to grow their business transformation services.

Dell and Dachis Group tied for #1 in Practice, with Pureplay firms Sidera and SxD hot on their heels. Forrester and Salesforce trailed further but made up the #3 score. Salesforce’s Practice ranking is artificially high because the firm has no social business transformation services; it does have a partner network that includes most of the other contestants here. It has the right point of view and messaging and practices social business well itself. Dell does a fantastic job of integrating customer-centric forums into its main domain, where prospective and existing clients can see them. IBM has excellent interactive blogs and forums, too, but they were not available to this research survey’s user, so they didn’t count. Pureplays had some of the best descriptions of social business-oriented transformation as well as their services to address it.

The second tier of Practice scores was led by two social business Pureplay Analyst (i.e. not management consulting) firms, Altimeter Group and Constellation Research Group. As Analyst firms, they focus on researching, interpreting and advising clients on social business transformation, but their services aren’t relevant past Strategy. They both practice social business well.

Six firms tied to take the last place in the “Top10,” which actually numbers 14 firms. Interestingly, Strategy firms McKinsey, Booz, BCG, and AT Kearney showed through their though leadership that they understood the transformation context. This matters because they have some of the best enterprise transformation practices in the world, so they understand clients’ needs and realities like no other advisory firms can.

Edelman is the lone MAP firm (Marketing/Advertising/PR) to make the Practice Top10. Although its core business is communications, Edelman has invested early in social business as a concept and has significant thought leadership focused on transformation. Moreover, Edelman is the best practitioner of social business in its cohort. Capgemini is an Enterprise I.T. firm with a good mix of blog integration with its main domain, interactivity and demonstrated understanding of social business transformation.

Top10 Social Business Leadership Rankings

Top10 Leadership shows advisory firms’ understanding of and commitment to social business transformation as reflected by its metrics of Momentum, Collaboration, Case Study, Tools, Firm Posts and Influence. Since its metrics emphasize content and reputation, let’s observe that it scales in a “traditional” way, thought leadership and marketing. Also, I was not surprised to find that the three dominant firm categories also monetize social business most easily: Enterprise I.T. (legacy pull-through), Analysts (research products) and Big Four (risk management services). Pureplays are far less funded, and they are newer, two facts that make them weak Leadership performers here.

Leadership is important for two reasons: First, these artifacts reflect organizational investment in thought leadership and outbound communication, which is an indication of commitment. Second, Leadership reflects perception of competence, but it can be a false indicator, especially in 2013. Talking about social business transformation shows that some people at the firm understand the context and some of the concepts. However, advising clients on the Social Business Life Cycle requires conceptual and hands-on expertise in Practice. Firms that rank high in Leadership and low in Practice will be limited to the early part of the Social Business Life Cycle.

Keep in mind that Leadership scales in a more traditional way: most of the Top10 are Enterprise I.T. and Analyst firms, with two of the Big Four muscling in. All these firms are large businesses with well funded thought leadership and marketing programs. Analysts’ core competency shows here: they are strongest in research and communications.

IBM took the #1 spot, falling only two points short of the maximum. In many ways, IBM has been the key pioneer and champion of social business for many years, so this finding was not a surprise. What did surprise was its relatively weak showing in Practice, which results from the use case. That said, the use case is valuable; it assumed the prospect had no prior knowledge of any advisory firm and judged them on a level playing field.

Accenture trailed IBM by only two points and has a sea of thought leadership on social business transformation. It lost points due to a weak showing in Practice. Accenture’s definition of “social media strategy” services was one of the best of any firm studied in terms of addressing the social business life cycle with high credibility. IBM, curiously, had a very scant definition of its services.

Analysts Forrester, Gartner and IDC are very strong in Leadership, where their core competencies shine, especially in Feasibility and some Strategy parts of the Social Business Life Cycle.

Deloitte tied IDC to make it into the #5 slot. It led the Big Four by a significant margin. Dell and Salesforce rank relatively low in Leadership, which reflects their late entry into social business as transformation. They do not have the “strategy and research” gene as prevalently as Analysts, Big Four and Strategy firms. IBM and Accenture both have large strategy firms, which enabled them to surface the social business transformation trend earlier, so they responded, and their results show it.

Infosys bears special mention because the firm has no discernible social business (or even social media) services, but it walks the walk. Its blogs are well integrated with its main domain, and consultants and partners are approachable in their interactions. They also took the medium score in the Collaboration metric, which measures how many of their people address prospects’ questions in a third party forum. I predict that Infosys will formally launch social business services in 2013.

Interpreting Results

Social Business Life Cycle

Clients’ needs for advisors is a function of the social business (adoption) life cycle (Here is a longer treatment):

1. Feasibility—is a rigorous analysis of market, industry and stakeholder adoption of social technologies as well as enterprise readiness. Usually used to baseline and prepare for aggressive enterprise scale social business.
2. Strategy—is more granular than Feasibility. It diligences/prepares the business’s optimal plan for interacting to achieve business-relevant outcomes. Often conducted for a brand or business. Social business strategy requires in-depth knowledge of how to measure trust, relationship and optimal interaction. Assesses organizational competency and recommends several Pilots.
3. Pilot—tests the strategy and builds organizational competency in interacting to build relationship and achieve business goals. Features mentoring in all facets of sociality. Pilots are killed fast or mature into ongoing initiatives via iteration.
4. Scale—expands pilots into larger, ongoing initiatives and builds social business infrastructure. Where Pilot is focused on tactical outcomes, Scale has a greater organizational context.
5. Integrate—reevaluates the organization’s legacy business processes in light of social business results, so it requires deep business process and transformation expertise at the organization level.

In 2013, no advisor category addresses the entire life cycle; advisors gravitate toward one or more parts of the life cycle:

• Analysts are limited to Feasibility and minimal Strategy.
• MAP falls between Strategy and Pilot and does not fully cover any phase of the life cycle.
• Strategy and Big Four firms can cover Feasibility and much of Strategy as well as part of Integrate, but they have little/none capability in Pilot or Scale.
• Enterprise I.T. and Pureplays fully cover Pilot as well as part of Strategy and Scale.

Social Business Use Cases

Client use cases are crucial considerations when selecting social business advisors. Here are some common ones:

1. Fix the Fire Drill—an external event suddenly propels social business up the priority list of a business that may have social media experience. It gets embarrassed in public, a competitor has a major social media win, or a major business deal gets affected. Leadership wants to “fix it,” so it doesn’t repeat.Strong focus on Strategy and mentoring in Pilot.
2. Upgrade Social Media—the business has been practicing social media for 1-4 years and has seen promotional results but little substantial business returns. Leaders want to reevaluate their efforts before diving deeper.Requires strong focus on Strategy and mentoring in Pilot.
3. Catch the Leaders—the business has a very conservative culture, so it has avoided using public social technologies; now it worries about being left behind. It gravitates to advisors that mitigate risks while leading the firm to overtake the leaders by outperforming them across the life cycle.Strong focus on Strategy, and mentoring in Pilot and Scale.
4. Herd the Cats—leaders suddenly realize that their various businesses have diverse social media presences without much apparent direction; they want to use strategy to provide a keel that resonates with corporate strategy and brand and create a social business “center of excellence” to serve several businesses.Requires due diligence during Feasibility, strong focus on Strategy, and mentoring in Pilot and Scale.
5. Transform the Enterprise—management wants to restructure the business to boost profits, so it evaluates social technologies as a potential lever. Comprehensive due diligence in Feasibility, strong focus on Strategy, mentoring in Pilot and strong guidance in Scale & Integrate.

• Fix Fire Drill and Upgrade Social Media are usually more tactical and don’t require Feasibility but do require Strategy and Pilot.
• Catch Leaders has a controlled sense of urgency, aims to outperform rivals by executing better.
• Catch Leaders, Herd Cats and Transform Enterprise are more strategic and address more phases of the life cycle.
• Fix Fire Drill and Upgrade Social Media will eventually extend to Scale and Integrate, which are out of scope for these use cases.

Using Results

Guidance for Clients

The purpose here is to illustrate how the rankings work; each business’s circumstances are different, and the selection of an advisory firm should be made of the basis of the team it proposes rather than the firm’s name or category. That said, the probability is that category rules are true more often than not.

• The Social Business Life Cycle is the best reference point for 
knowing what kind of advisor you need because it’s grounded in your situation.
• When your business intends to do Pilot and Scale, consider advisors with the highest Practice rankings: Dell, Dachis, SxD and Sidera.
• The context of Strategy varies with the use case: in Fix Fire Drill and Upgrade Social Media, it is focused on specific brand or business unit goals, and Pureplays should be strong contenders. Catch Leaders and Transform Enterprise demand more rigor, so look at IBM, McKinsey, Accenture, Booz, AT Kearney or Deloitte.
• Remove Analysts from consideration if your business is doing Strategy or after. Forrester would be a strong choice for independent Feasibility work.
• Remove MAP agencies from consideration for most social business initiatives; with the possible exception of Edelman, they show little awareness of social business transformation, and they have low Practice rankings.
• Analysts and MAP could be relevant to any use case but would require complementary advisors.
• In 2013-2015, pioneers will have to take a “best of breed” approach and use different advisors at various parts of the life cycle, although I expect Pureplays to build capability quickly as demand grows.

Teams are most relevant to your results, so allow for exceptions to rankings; however, teams generally reflect their firms and categories.

• Use Practice metrics to study IBM, Accenture, McKinsey, AT Kearney,
 Dell, Deloitte & Dachis; compare their social business services. Accenture has the best description of its social business services.
  • IBM has many presences & thought leadership on social business transformation.
  • Dell leads in integrating forums and client/customer voice into its website.
  • Deloitte has a nice mix of social business services and thought leadership, but it drops the ball in relating; this is the rule for firms, not the exception.
  • Dachis has an active blog with relevant topics and discussions.
  • AT Kearney features little social business content and no services, but leading partners show that they understand social business transformation, and they are approachable yet credible.
  • McKinsey has invested in social business thought leadership for years, and its “The Social Economy” is best in class. Read it. Thoroughly. Note the transformation argument, rationale and call to action.
  • The Social Network Roadmap addresses the entire social business life cycle.

Also learn from firms’ weaknesses, which are indicators of their ability to serve you effectively. Most lose points because they don’t address the Social Business Life Cycle, services are scattershot, and they have minimal leaders relating online and thus no credibility. Most cling to firmspeak, which shows that the firm doesn’t understand the new environment.

• Use Leadership metrics to start your short list of firms committed 
to the idea of social business transformation of organizations.
  • Most firms start talking before they have much competency; however, if they aren’t even publishing blog posts, papers, services frameworks and other tools, they aren’t in the game; let them learn with someone else.
  • Social business is about interacting online to communicate your community, priorities and beliefs. Therefore, firms that talk about social business and don’t show they “walk the walk” through their partners’ and principals’ interactions will be very limited in their ability to help you.
  • Make sure to recognize the distinction between talking about social business (Leadership) and doing it (Practice). All firms have smart people who understand certain concepts; however, successful social business is based on action and understanding the many nuances of sociality. What can a firm tell you about “creating relationship” if its people can’t show they do it themselves?
• Get more in-depth advice in firm category reports, via the research survey home page. Also use the Executive Briefings as introductions to this Executive Summary; they are slide decks that introduce the key ideas here (14 slides) and available as Guidance for Clients and Guidance for Firms.
• As you may have guessed, CSRA addresses the entire Social Business Life Cycle; I invite your inquiry about the survey’s detailed reports; you can commission a report on any firm as well in case you are considering advisors not included here. Likewise I can change the basket of metrics used to fit your goals.

How advisors and use cases map to the Social Business Life Cycle:

Guidance for Advisory Firms

Your firm is undoubtedly at some stage of evaluating social business, perhaps as a potential service offering to your clients, but certainly for your own use, and likely both. If this research survey’s philosophy and approach resonate with you, your firm can use rankings as tools for building your capabilities to address the expanding social business market while avoiding the deflating social media market.

• Study this research survey’s six reports, which analyze Strategy, Big Four, Enterprise I.T., Analyst, Pureplay and MAP firms (Marketing/Advertising/PR). Access them via the research survey home page. Read a couple of them to learn how the rankings and metrics work. Note that all include separate advice for clients and firms.
• I have repeatedly seen in client work with global firms that social business has a strong defensive aspect. Clients discover that, when they open spontaneous, continuous communication with stakeholders, they have a better grasp of emerging market developments that affect their legacy businesses. Offensively, they can launch new offers and make legacy offers more relevant.
• Examine the Social Business Life Cycle. I have chosen it as the substrate for the research survey’s interpretation because it reflects organizations’ reality, and I serve them, as do you. What parts of the life cycle are most relevant to your firm and your related practices? You can start and expand.
• Inventory and evaluate your partners’ and principals’ presences in social networks, forums, blogs, microblogs and others. Who is already having substantial interactions in which s/he is serving others, with a professional-yet-personal demeanor? You can start with a few highly motivated people; motivation and skill counts more than position in your hierarchy.
• Although not required to start, it will be helpful for you to choose one or more leading partners as champions. Champions need not be strong social business practitioners (although that helps), but they do need to understand and commit to its value proposition to clients and your firm. One of them at least needs to be a visionary.
• Use Practice metrics as lenses through which you study IBM, Accenture, Dell, McKinsey, Deloitte, AT Kearney and Dachis, and compare your firm to theirs in two ways: 1) how you/they use social technologies and 2) social business service offerings. All these firms have strengths and weaknesses:
  • If you dedicate the time to find them, IBM has many presences & thought leadership on social business transformation.
  • Dell leads in integrating forums and client/customer voice into its website.
  • Deloitte has a nice mix of social business services and thought leadership, but it drops the ball in relating; this is the rule for firms, not the exception.
  • Dachis has an active blog with relevant topics and discussions.
  • AT Kearney features little social business content and no services, but leading partners show that they understand social business transformation, and they are approachable yet credible.
  • McKinsey has invested in social business thought leadership for years, and its “The Social Economy” is best in class. Read it. Thoroughly. Note the transformation argument, rationale and call to action.
  • The Social Network Roadmap addresses the entire social business life cycle.
  • Learn from firms’ weaknesses. Most lose points because they don’t address the Social Business Life Cycle, services are scattershot, and they have minimal leaders relating online and thus no credibility. Most cling to firmspeak, which shows that the firm doesn’t understand the new environment.
• Use Leadership metrics for guidance in how to communicate and project your point of view on social business and how you relate to adoption. Leadership should be less important to you until you have a strategy for your firm’s social business services.
  • Firms that project Leadership ahead of their ability to deliver (Practice) lose credibility with astute clients/prospects. Most firms that led the survey in Leadership had woefully scant descriptions of their social business services.
  • Practice trumps Leadership because it delivers; firms need to show their competence through their partners’ and principals’ online interactions.
  • Watch Analyst firms, especially Forrester, Constellation Research and Altimeter. Although they do not field substantial transformation services, they understand the social business value proposition, and all use social technologies very well.
  • Leadership should be less important to you until you have a strategy for your firm’s social business services.
• I invite your inquiry about the survey or findings. You can commission a report on any firm and learn more detailed findings. I also advise firms on building practices.

Social business will eventually transform all organizations, but leaders have more choice about how it happens. Pioneers move early and set the table for laggards, who reactively get sorted out by the market.

Additional Resources

• The research survey home page contains all public artifacts, and I’ll update it with additional links and resources.
• For more detailed guidance, clients and firms can turn to firm category reports (Strategy, Big Four, Analyst, Agency, Enterprise I.T., Pureplay).
• You can also commission individual firm analyses or research surveys. I advise both firms and organizations on maturing their social business practices ahead of the market. Contact me to explore.

The post Executive Summary: Advisory & Services Firm Social Business Adoption 2012 appeared first on Christopher S. Rollyson and Associates.

This post originated at CSRA's blog. Please share your thoughts and comments here. Thank you.

[UPDATED] Enterprise I.T. vendors are chiefly product businesses that specialize in large-scale “solutions,” and all contenders in this research survey field large services businesses. They are a diverse group that was selected based on their public activity relevant to social business transformation. For example, Salesforce.com is a leading cloud infrastructure and services provider that sells organizational flexibility, which synergizes with social. IBM, Dell and Hitachi are large product vendors, although IBM’s services business is now larger than its product divisions. Accenture, Infosys, Capgemini, TCS and Cognizant are large outsourcing providers, although Accenture’s roots are management consulting, and it subsequently developed a large outsourcing business. BearingPoint is regrouping after bankruptcy; its origin, like Accenture’s, was an audit firm spinoff (KPMG and Andersen respectively).

As you evaluate advisory firms that are moving into social business, it is useful to refer to their DNA. Enterprise I.T. firms scale largely by selling products or productized services. Many have “collaboration” solutions, and they tend to approach social business within the context of product strategy. Product vendors are furiously bolting on “social” features to their enterprise software solutions. This characteristic engenders pluses and minuses: they are highly motivated to be relevant in social business because they have a direct line of sight to how it can make them money. On the minus side, they are mostly focused on moving product. Of course, Salesforce is a vendor that is disrupting the whole model (“No Software”).

Enterprise I.T. firms have significant promise for addressing the social business adoption life cycle. Like Big Four advisories, they have significant competency in enterprise transformation and process change—and they have the advantage of not being constrained by ties to regulated businesses. Consequently, their cultures are not as conservative. Capgemini is based in Europe while TCS, Infosys, Cognizant and Hitachi hail from Asia.

Due to its diversity, this group’s summary will fit for some better than others. Please refer to the Extended Analysis for individual analysis.

Advisory and Services Firm Social Business Adoption 2012 is a research survey that evaluates and quantitatively ranks the maturity of agency and consultancy social business practices. The survey ranks Strategy firms, Big Four, Marketing/Advertising/PR agencies, Analysts, Enterprise I.T. firms and Pureplays on their social business practices, service offerings and leadership—specifically according to their relevance for leading client organizations’ transformations to more human entities that are grounded in listening and responding, not marketing.

Capabilities

Enterprise I.T. firms are extremely diverse because their economics work differently. Broadly speaking, Dell, Salesforce, IBM and Hitachi have large hardware and software businesses. Accenture, IBM, Infosys, Capgemini, TCS, Cognizant and BearingPoint have large outsourcing (i.e. recurring revenue) businesses. Significantly, their relationships are usually at more operating levels. As a cohort, they are stronger in implementation and operations than strategy. Interestingly, they are also stronger in the latter part of the Social Business Life Cycle.

• Feasibility assesses the adoption of social technologies by a client’s stakeholders as well as certain aspects of the client organization, so it emphasizes the market as much as the client’s readiness to implement social business. Although all firms profess to do “strategy,” as a group, market studies and business strategy are not core. Two notable exceptions are IBM and Accenture. No firm showed that they understood the importance of engaging specific stakeholders to increase trust and business, as an actionable goal of social business. Their firm category has a None-Low capability in Feasibility, but note exceptions.
• Strategy focuses on identifying the optimal social venues in which to engage, determining the client’s highest impact assets and designing pilots to execute the strategy. Firms conduct granular analysis of social venues, stakeholders’ social actions and client assets and business processes. A valuable social business strategy requires strong analytical skills and knowledge of social business practice and an appreciation of trust and relationship. Enterprise I.T. firms do not exhibit high levels of strategy and social analytical expertise, but they show some of the highest levels of social business practice of any firm type. The category has a None-Low capability in Strategy, but there will be important exceptions to the rule.
• Pilot involves guiding clients’ execution of social business strategy, and Enterprise I.T. firms have a relatively strong demonstrable experience in social business practice. Dell’s forums epitomize open sharing, Salesforce blogs are very strong, IBM has defined thought leadership in social business for years. Accenture has a well balanced mix of Leadership and Practice. As a category, they rank Medium.
• Scale focuses on forging mature social business programs by expanding Pilot; however, its requirements for expertise are even higher since the effort is more mature and the investment higher. Enterprise I.T. firms are solid in Pilot, as a cohort they have strong operational and business process expertise, but none show they understand the role of trust and relationship in business. On balance, they have a low capability in Scale.
• Integrate evaluates mature business processes in light of social business and integrates them or replaces the mature process with a social business process. It requires sophisticated knowledge of people and sociality to evaluate legacy processes and fuse them with social business. As a cohort, Enterprise I.T. don’t reflect sophisticated social knowledge, although their relatively strong showing in social business practice indicates that Integrate in within their core competencies. They rank Low for Integrate.

Overall Score Distribution

Enterprise I.T. firms showed the highest Overall scores of this research survey. They have some of the highest Practice scores, and IBM and Accenture were the strongest in Leadership. These firms walk the walk of social business better than Big Four, Strategy or Marketing/Advertising/PR firms. Analyst firms were slightly lower. Therefore, Enterprise I.T. firms are more credible as social business advisors. In addition, their employee involvement tends to be broadly distributed, which is a strong predictor of the firm’s skills.

Enterprise I.T. had the top two Leadership scores; Accenture and IBM have a long commitment to discussing social business as transformation. They have very large thought leadership, marketing and communication programs that address social business in general. IBM especially is widely quoted for its market analysis.

Salesforce.com and Dell dominate in Practice, doubling Accenture and IBM. Dell’s use of open blogs and forums is well integrated with its main domain, where prospects can find it. Likewise, Salesforce.com has blogs well integrated with its main domain, effectively extending senior executives’ voices right to the website where prospects can appreciate them.

Dell earned the highest overall score of the study—in any firm category. It has been a guiding light in using social media in its business. Remember that Dell had a rough start social media (Jeff Jarvis and the burning laptop); they learned their lesson and have led since then (see my coverage of Manish Mehta’s behind-the-scenes insights). Dell earned an outstanding Practice score; their forums are easy for clients and prospects to find, they are professional and open venues, and they show extensive client and prospect activity. That is the strongest sign of Dell’s success at creating a space in which people want to share problems and solutions. Neither does the company try to sell anything in its forums. Clicking around dell.com, they make known what they are about and how they think they could help you. They also field blogs that are well integrated into dell.com. Their Leadership scores trail the research survey leaders, fellow Enterprise I.T. firms IBM and Accenture. Dell has climbed on the social business transformation bandwagon but recently, where IBM and Accenture have been committed to it longer.

Salesforce.com is very active in pushing the “social enterprise” model as a way to challenge traditional I.T. models and vendors. From a structural and cultural perspective, it is a different animal; based in Silicon Valley, it extends its capabilities via partner networks. Salesforce also showed excellent integration of open communication to their main domain. They had the highest quality of executive blogging that was easily accessible. Their site contains considerable information, but it is easy for prospects to navigate. However, their score suffered by the lack of relevant specifics of their social business professional services. They have no defined offerings or services. They also fail to make it clear why they are committed to social business, so it is more difficult for prospects to orient themselves to salesforce.com. It seems implied that prospects need to select a social business partner, but they do not make this clear. Notably, most other Enterprise I.T. and Big Four firms are partners and easily accessible from the salesforce.com navigation bar.

Accenture edged out IBM to round out the top three. Their description of social business services is oriented to the Social Business Life Cycle. Moreover, their “Social Media Diagnostic” features a sample diagnostic report that contains some detail but not too much. They write authoritatively about the life cycle and feature specific services relevant to most phases. That said, they missed Practice points on Leader blog and Personability. Their blogs were not relevant to social business, and interactivity was minimal. They project a 20th century firmspeak personality as well. This is a significant, higher order, social business competency they would do well to build.

IBM suffered by having too much information and not designing ibm.com for this use case. From personal experience (CSRA is an IBM Business Partner), I know that IBM is an exceptional social business practitioner whose Practice scores would have been much higher if the study design had been different. I know hundreds of IBMers personally and professionally, so I know they have extensive depth and breadth in using social technologies to engage the user in this research survey’s use case. However, ibm.com does not integrate IBM’s blogs and forums, so they are not easily accessible by a prospect. IBM had the highest Leadership score of any firm category because they have pioneered the concept of social business transformation. I was incredulous at the paucity of specificity of their social business transformation services on ibm.com. In this case, they serve as an example of what not to do. In addition, they do lead by having some senior partners blog, but the personability suffers; like Accenture, it feels too much like firmspeak, not engaging like Salesforce and AT Kearney.

Infosys and Capgemini do a solid job of integrating blogs into their main domains. Infosys was notable in blogging; they address social business-related issues well and have good interactivity. Capgemini’s Practice score was third in this cohort largely due to its blogging and interactivity, and its integration with their main domain. However, neither firm defines its social business services very well, but their message is clearly transformation. As typical for this firm category, they orient transformation to technology, which shows they have yet to fully discover sociality.

The rest of the field exhibited some messaging around social business or social media transformation but did not define their services. TCS, Infosys and Cognizant have comprehensive capabilities, but they are behind the others in defining social business offerings.

Recommendations for Enterprise I.T. Clients

Enterprise I.T. firms represent one half of this research survey’s Top10. They show that they understand the concept of social business as transformation. As noted above, it is no surprise that, with the exception of Analyst firms, they can most easily monetize social business in the context of their legacy products and services. Three Enterprise I.T. firms were Top10 in Practice, which shows that they walk the walk. Analyst and Strategy firms similarly had three of the Practice Top10. However, in Leadership, Enterprise I.T. firms occupy half the Top10. This makes sense; since they have a business rationale and consulting expertise, they have finely honed marketing machines and consultants producing and sharing social business transformation content.

Engaging a Enterprise I.T. Firm for Social Business

• I will reemphasize the power of orientation. Enterprise I.T. firms’ strengths can become weakness for companies that want to discover how to use social business to reinvent their relationships with their stakeholders. As a general rule, Enterprise I.T. are here to offer technology solutions, so technology often enters the discussion too early.
• If you have a trusted relationship with one or more of these firms, you would do well to pursue it; as with all advisory firms, individuals often matter more than firms, so evaluate the team, and validate their competency publicly. Numerous members of the proposed team should be able to share links to open interactions on meaningful topics that are relevant to work you want to do. If not, keep looking. Also look for strong representation on the proposed team of members with Strategy or Big Four consulting experience.
• Firms’ published Point of view, Practice definition and thought leadership are important signals of firm organizational commitment. Enterprise I.T. firms are stronger than any other firm category here.
• Unlike Strategy or Big Four firms, Enterprise I.T. firms are strongest in Pilot, which emphasizes social business practice. When they field teams with solid strategy consulting experience elsewhere, they can potentially address the entire Social Business Life Cycle.
• Dell gives us an excellent example of leading with sociality, largely through its forums, which succeed in being customer spaces although Dell employees are well represented. Although social business uses digital tools for social transactions, humanness is the key; the technologies just provide mechanical tools to communicate and share being human. Therefore, sociality is the differentiator.
• Enterprise I.T. firms do not show that they have an explicit understanding of sociality, although some practice it decently (Dell, Salesforce). There is very little awareness of sociality anywhere, especially in consultancies. Humanness is something people “practice” largely unconsciously, so it represents implicit knowledge and skills. To leverage its power, organizations and individuals must make it explicit to speed their learning process.
• Early adopters that practice social business and have explicit knowledge of sociality are your best leaders. Look at their blog posts: does a healthy portion deal with humanness, relationships, trust and sociality? Promotion is a small part of being human; don’t be seduced by cleverness.
• Enterprise I.T. firms do not have conservative cultures that they must transform, as with Strategy, Big Four and, to some extent, Analyst firms. This frees them to adopt more quickly.
• This research survey’s Practice score is much more valuable than its Leadership score because it’s a better determinant of the best advisors; it houses the lion’s share of differentiation.
• Do not pick a “type” of advisory firm; look for a balance of leading edge thought leadership and walking the walk. Enterprise I.T. firms show through their people on their main domains that they are comfortable using social technologies for their core business processes. I predict this will continue to grow significantly in the years ahead.
• Do not allow yourself to be convinced by firm partners that “younger consultants” are facile with social technologies. It is a widespread myth that “anyone under thirty” can “do social media.” Advising companies on using social business to transform their cultures, brand definition and operations requires the ability to interact with social technologies to increase trust and develop relationships. This is beyond individuals’ facility with using the technologies personally.
• Most important, own your organization’s journey, don’t abdicate to any advisor. Enterprise I.T. firms have broad capability in transformation and operations, so they could be valuable partners if the team were right for your needs. As Score Distribution indicates, think to use Enterprise I.T. firms during some Strategy, but mostly in Pilot and afterwards, where their capabilities resonate strongest with the Social Business Life Cycle.

Beware These Risks

• DNA being what it is, if you choose to work with an Enterprise I.T. firm, you must beware their “solutions mindset.” As long as you keep this in mind and correct for it, they are your strongest overall partners. IBM and Accenture have well established Strategy firms within the behemoth consultancies that feature alumni from Strategy and Big Four firms. When evaluating them, use this research survey’s Strategy and Big Four Firm reports.
• Practice is paramount, and Enterprise I.T. firms show strong. I hypothesize that this is the result of two factors: lack of conservative cultures and a clear path to money, both discussed above. Organizations, in the outdated Industrial Economy view, are impersonal places, and the Knowledge Economy is changing that. All organizations need to go through a period of “humanization.” That means practicing, looking foolish, learning and adjusting in tight cycles.
• Keep in mind that one of the biggest risks of social business is companies thinking they are taking advantage of social technologies when they are not. Many of the social media early adopters who emblazon the covers of publications and conference podiums have succumbed to this pitfall. Social media is relatively empty calories when compared to building relationships.
• The longer your organization delays real risk-taking and practicing, the more risk it engenders. Most executives will be happy to get intellectually smart, grace a few podiums, get quoted in advisor case studies and call it a day. They are doing themselves and their organizations a disservice.
• Few organizations appreciate the necessity of practice. Look for individual strategy consultants who put themselves out there, usually via blogs, but also in Google+, Twitter, on YouTube and on social networks.

Learning More

• Visit the Advisor and Service Firm Social Business Adoption 2012 home page to keep apprised of additional inquiries and insights
• The CSRA blog is long form; subscribe to the whole thing, a category or even a tag via RSS or email. See: http://rollyson.net/social-business-resources/#subscriberonly
• Get a more “stream of consciousness by following my Google+ profile: 
http://google.com/profiles/csrollyson

SWOT Analysis

SWOT analysis can be a useful tool to understand advisory and services firm strengths and weaknesses, especially to executives and professionals who have used it, so I have prepared Enterprise I.T. firms’ SWOT analysis in the table.

Enterprise I.T. Firms’ SWOT Analysis
Strengths IBM and Accenture have well established and comprehensive strategy practices, which adds to their ability to advise clients across the social business adoption life cycle. Most Enterprise I.T. firms have some strategy capability. Senior executive relationships in many enterprise functions, although often focused in I.T., which is rarely a social business owner. Some market permission for transformation work, especially related to technology. Most have large, process transformation and training practices, methodologies, project management offices, centers of excellence, etc., which can be very valuable in facilitating enterprise transformation.	Weaknesses DNA is large-scale projects, which might not jell with social business, which tends to work best in fast-cycle, small teams. Technology product mindsets; most of their revenue comes from large solutions, so social business transformation may play second fiddle. Some firms have a lack of mindshare with CMOs who usually own social business right now; however, as clients realize that “social” means collaboration, it will outgrow the marketing umbrella, so this weakness will diminish over time. Most Enterprise I.T. firms have little CEO mindshare, IBM and Accenture notwithstanding.
Opportunities I.T. represents a significant, growing budget item at most firms; using social business to transform I.T. across entire product and service life cycles would resonate with Enterprise I.T. core competencies. I.T. is maturing fast, which gives Enterprise I.T. firms opportunities and threats; if they use social business to have more spontaneous, continuous relationships with clients, they could innovate faster. Consumerization of I.T. gives firms an opportunity to get closer to end customers (of their clients), and social business could help them capitalize on it; to benefit, Enterprise I.T. firms must reinvent themselves by understanding sociality and humanizing their cultures.	Threats To claim their piece of the social business pie, they need to develop core competency in using social technologies as IBM, Dell and Salesforce.com are doing. The Enterprise I.T. value chain is under threat in many areas, which will endanger some of their businesses. For example, Dell has been slow to appreciate tablets’ impact on the P.C. market. Salesforce is a major disruptor in the category (“No Software”).

• Strengths of Enterprise I.T. firms gravitate toward the middle of the Enterprise Social Business Life Cycle, and many firms have strong strategy teams, too. That said, with the exception of very few individuals, strategy leaders do not show that they understand sociality. No other firm category did better, though. Since Practice is so important, Enterprise I.T. as a category is strongest, especially because Analysts, who easily vie with Enterprise I.T. for top scores, have minimal if any management consulting services.
• Weaknesses have been well discussed; the “solution mindset” can be “a hammer looking for nails.” This could cause consultants to neglect sociality, the true differentiator. As long as you correct for this and insist on social, not technology, focus, Enterprise I.T. firms can field excellent teams for organizations.
• Opportunities will accelerate for all firms that understand and tap the power of stakeholders’ sociality. Enterprise I.T. firms have significant market recognition and permission for social business work, but to fully capitalize, they need to reorient away from technology, which is rapidly becoming a utility.
• Threats loom for Enterprise I.T. firms that hold onto maturing technology too long. As with Analyst firms, they would do well to help clients sunset legacy technology models and solutions. Cloud and virtualization are clearly the direction in general. However, sunk I.T. costs and old fashioned mentalities will prevent clients from adopting quickly, so firms that manage their portfolios can cash cow them for several years as long as they pivot to more social-oriented services.

Recommendations for Enterprise I.T. Firm Leadership

“Web 2.0” suggests that social technologies are a linear progression from “Web” technologies, but that is deceptive. It digitizes sociality, the defining human trait. Digital sociality will transform society and business because it changes the economics of relationships, what people do and how they do it.

Even more unusual, people are leading the change, not organizations. Generally, disruption increases demand for Enterprise I.T. services. That said, the dynamics that make a difference are changing from mechanical to personal. Less I.T., more “soft” people aspects.

Using Social Business to Strengthen Enterprise I.T. Firms

• Obviously these are general recommendations, and each firm is different.
• Getting your firm’s hands (and arms and shoulders) dirty with being spontaneous and human in transparent environments is vital. Developing explicit competencies in trust building and relationship management at scale will be a huge driver of competitiveness in business. Firms that recognize this and develop competency ahead of the pack will benefit enormously because social technologies are accelerators.
• You already have armies of developers that are furiously “socializing” your software and solutions, but they likely are treating Web 1.0—Web 2.0 as a linear evolution. It isn’t. You can use consulting to source business scenarios that are grounded in stakeholder reality. It is important that your consulting teams ignore your products so that they can see the changing world in purely stakeholder terms.
• I.T. is shifting into a more invisible role in business—as electricity did about a century ago in developed economies. You need an explicit effort to reorient your organization away from I.T., and consulting can play a vital role, especially when you untether it from product businesses.
• It could be useful to think in terms of your own organization’s transformation as a service offering for clients. As detailed in the Social Channel, all organizations will have to undergo profound change to remain relevant in the digital social world.
• Don’t approach this transformation superficially as some stakeholders will prefer. Most firms are “going through the motions,” and very few partners interact with social technologies. Senior partners have to be involved to make it real.
• Dell and IBM serve as strong examples of using social for culture change. The more proactive you are, the more choice you will have in how you transform. Laggards will find themselves chasing a market that has accelerated past them and pulling away. Many will go under.
• A big part of approaching the shift to the Social Channel is approaching it with the right perspective (profound disruption). I believe that firms that adopt first will thrive and others will not survive if they wait too long. The main reason is that social technologies are accelerators—because they enable people to change how they enter and manage relationships and collaboration. The people bit takes most firms much longer than they think. Your existing culture is a major factor of how long transformation will take.
• Approach firm culture change head on. The way in which firms, and members within them, approach being human and public allows for significant variety, but it will require profound culture change at many firms. The earlier you start, the better.
• Consultants epitomize “knowledge workers,” and social business consultants have individual reputations that may dwarf organizations. You will be better able to engage stars if your firm redefines itself as a platform for individual consultants to develop their careers. Optimize your roles to empower individuals. This requires jettisoning paternalistic attitudes that pervade Strategy firms, agencies and Analyst firms.
• It is difficult to overstate the profound change that is upon individuals and organizations. Primates are profoundly social; sociality is arguably our defining trait. Making sociality digital will change most human structures, organizations, patterns and habits. To remain relevant, Enterprise I.T. firms need to be in the middle of it—as practitioners.
• Therefore, building social business capability in all parts of the life cycle is at least as vital from an R&D perspective as it is from a profit viewpoint.
• Advisory firms that fail to develop strong social skills will lose relevance because sociality will disrupt clients, so developing social business practices is defensive as well as offensive.
• Social business capability will enable Enterprise I.T. firms to mitigate the risks in how their existing businesses weather the storm. Clients’ needs will change profoundly, and seeing their evolution from the inside will be a significant advantage.
• Careful management can maintain existing profit margins for years to come, especially when Enterprise I.T. firms focus on how social business is affecting legacy practices.

Beware These Risks

• Treating social business as a linear evolution. No person or organization likes disruption and throwing away things that have been successful in the past. Yet Enterprise I.T. firms will have to throw away many of their products and services over time. If they don’t, the market will do it for them by refusing to pay any more.
• Failing to appreciate “the human angle.” No one can really understand it until s/he has spent high-value time interacting and building trust online. Very few people understand this, but it is easy to learn once the firm has the appropriate focus.
• Not starting the firm culture change early enough. The Knowledge Economy is a more personal and public economy, and Enterprise I.T. firms have a significant advantage over Strategy and Big Four firms, which have very conservative cultures that can serve to retard their transition to open, informal entities..
• Restricting your firm’s approach to social technologies to product strategy. I can’t say it often enough: products matter less and less. Having sincere interactions and building and managing relationships is where the puck is going.
• Practicing social media and thinking that is “keeping you current”—as a consulting offering and as a firm. The market overall validates social media because it hasn’t discovered social business yet. Sociality, relating to people, is far more complex and nuanced than promoting things to people. Make sure your firm appreciates the difference.
• Client expectations are rising quickly. Enterprise I.T. firms that delay adoption too long will never become relevant; this market, because digital interactions move so quickly, develops faster than anything humankind has experienced before.
• Failing to appreciate that social business is social, which is the engine of everything humans and society do. It will require much more social awareness, which is outside Big Four firms’ traditional competencies. However, neither do Strategy, Big Four or Analyst firms have it. MAP agencies understand people much better than any other firm type, but they are unaccustomed to relating to people. They sell to them. This creates a vacuum in the market.

Learning More

• Visit the Advisor and Service Firm Social Business Adoption 2012 home page to keep apprised of additional inquiries and insights
• The CSRA blog is long form; subscribe to the whole thing, a category or even a tag via RSS or email. See: http://rollyson.net/social-business-resources/#subscriberonly
• Get a more “stream of consciousness by following my Google+ profile: 
http://google.com/profiles/csrollyson

The post Enterprise I.T. Report: Advisory & Services Firm Social Business Adoption appeared first on Christopher S. Rollyson and Associates.

This post originated at CSRA's blog. Please share your thoughts and comments here. Thank you.

[UPDATED] Marketing, advertising and public relations (MAP) agencies have comprised the largest share of the “social” advisory and execution firms for many years. Most of the other advisory firms are relative late entrants, with the exception of some Analyst and Enterprise I.T. firms. Communication forms the core of social technologies, and MAP agencies have been pivotal in leading the growth of social media activity in their clients, many of the largest brands in the world.

However, this research survey argues that, although social media will remain an important portion of the total economic value produced by using social technologies, it will devolve into a minority portion. Collaboration and pervasive innovation will be the majority, which will require enterprise business process transformation. MAP agencies lack competencies in management consulting and enterprise transformation, so they are in an ambiguous situation, being the leaders in social media, a shrinking market in the medium to long term. This report shows how agencies can navigate these rapids and how their clients might best partner with them for social business transformation.

Advisory and Services Firm Social Business Adoption 2012 is a research survey that evaluates and quantitatively ranks the maturity of agency and consultancy social business practices. The survey ranks Strategy firms, Big Four, Marketing/Advertising/PR agencies, Analysts, Enterprise I.T. firms and Pureplays on their social business practices, service offerings and leadership—specifically according to their relevance for leading client organizations’ transformations to more human entities that are grounded in listening and responding, not marketing.

Capabilities

Due to this research survey’s focus on using social technologies to transform business across the Social Business Life Cycle, MAP agencies’ limited application of social technologies brought down their scores as a firm category, although there are some notable exceptions as discussed in the next section. They have strong capability in a narrow, declining part of social business, promoting their clients’ brands, products and services. That said, they have the ability to retool their skills and expand their competencies rapidly.

• Feasibility assesses the adoption of social technologies by a client’s industry, adjacent value chain players and stakeholders as well as the client organization’s business processes, so it emphasizes the market as much as the client’s readiness to implement social business. Most MAP agencies have teams that specialize in using social media monitoring platforms, but their focus is usually measuring promotions’ effectiveness. Moreover, agencies rarely assess client organizational competencies. Due to their capabilities with SMMs, MAP have a None-Low competency in Feasibility.
• Strategy focuses on identifying the optimal social venues in which to engage, determining the client’s highest impact assets and designing pilots to execute the strategy. Firms conduct granular analysis of social venues, stakeholders’ social actions and client assets and business processes. A valuable social business strategy requires strong knowledge of social business practice. Although MAP have relatively high skills with social technologies, their focus is promotion and content distribution, not collaboration. Their presences, with very few exceptions, don’t even reflect an understanding of brands’ need to transform. Therefore, their category has a Low capability in Strategy.
• Pilot involves guiding clients’ execution of social business strategy, and MAP exhibit unbalanced levels of social business practice (mostly promotion, not collaboration). Some agencies have partners that blog fairly well, but several agencies’ comments were suppressed. Most important, none of their presences emphasize mentoring clients, which is urgently needed because outsourcing social business is counterproductive in the long term. Therefore, MAP have a Low capability in Pilot.
• Scale focuses on forging mature social business programs in all areas (promotion, collaboration) by expanding Pilot; however, its requirements for expertise are higher since the effort is more mature. This is well outside MAP agencies’ core competencies, so they have None.
• Integrate evaluates mature business processes in light of social business and integrates them or replaces the mature process with a social business process. The competency required is shared between social business and legacy business process analysis and redesign. Like Scale, Integrate is well outside MAP core competencies, so they have None.

Overall Score Distribution

Agencies would lead the rankings if this study were focused on social media, but as a category, they rank lowest due to the social business strategy and transformation metrics used in rankings’ metrics.

Edelman Digital was the only firm/agency to make the Top20 list, although Critical Mass, R/GA and Ogilvy Social trail only slightly. Edelman leads the category significantly in Practice ratings, largely due to its execution of social technologies and thought leadership that addresses social business, if peripherally from a business transformation standpoint.

Critical Mass has a very interactive culture, so its Leadership rankings led the category. Its blog, Experience Matters, features posts by staff in various offices as well as agency executive posts. It shows little interactivity, but their culture and personality are engaging, personal and professional.

R/GA has recently announced the formation of a “business transformation” practice and has begun creating some thought leadership around it, which raised its scores. If they have visionary leadership, they may pioneer a new agency model that focuses on empowering others to communicate and collaborate. They offer very little specific information on what “business transformation” means, but the general intention seems clear.

Ogilvy Social just squeezed into the top rung of MAP based on its use of social technologies. It fields numerous blogs that nonetheless read like brochures; they feature some useful content, but the tide is turning to human scale authenticity and a less “produced” feel for most use cases.

The rest of the field scored significantly lower; their uses of social technologies were often not integrated with their domains, which looked like html5 brochures. This is very understandable because content and outbound communications are their DNA. Even “interactive” agencies attempt to use their content to compel the viewer to take a measurable digital action; they rarely aim to develop relationship and encourage people, erstwhile “consumers,” to interact among each other. Therefore, Marketing/Advertising and Public Relations agencies have a dilemmathat confronts none of the others to the same extent: they are large, global businesses based on serving large brands’ practice of designing and delivering communication and content to audiences, and this model is under threat in the medium to long term.

Agencies have the communications skills to succeed in the social business era, but they face a profound culture change because communication’s emphasis is shifting from passive one-to-many consumption to active many-to-many collaboration. All agencies have the opportunity to make the shift.

Recommendations for MAP Clients

As reflected by the Capabilities section, MAP agencies are quite limited in their practice of social business as defined here, although this can change rapidly for agencies that perceive the shift and retool their considerable competencies. Here are my general recommendations for working with a MAP agency on social business initiatives that emphasize organization transformation.

Engaging a MAP Firm for Social Business

MAP agencies as organizations will make dubious partners for social business transformation in the short to medium term. However, as with all advisory and services firms, often the individual teams are more relevant than the organizations in which they work. In considering an agency team to advise you, look for team members who have been in the business strategy transformation trenches at Strategy, Big Four or Enterprise I.T. firms.

• MAP agencies are the strongest communicators as a category, although Analyst firms also ranked high in practice due to their core competencies in producing content, events and thought leadership. Agency professionals tend to be comfortable in public, and this can be a strong asset in advising clients on how to interact.
• However, MAP is a dichotomy: Agency cultures are typically very promotional, fun, “creative,” etc., which is a liability in situations that demand “getting real” and living the reality that what a brand says (i.e. what the agency says on behalf of the brand) is less important than what other people say. This reality is very disruptive to brands and MAP.
• Likewise, MAP, especially digital agencies, often have very sophisticated competencies in understanding online behavior, which is quite related to sociality. This is another significant aspect that, once they expand their view outside promotion and marketing, can enable them to be strong social business advisors.
• Sociality, humanness and being “real” are the differentiators in social business. Therefore, look for individuals, regardless of the logos on their business cards, because early adopters that practice and have explicit knowledge of sociality are your best leaders. Look at their blog posts: does a healthy portion deal with humanness, relationships, trust and sociality? Promotion is a small part of being human; don’t be seduced by clever wittiness. This is not to discount organizations, which can empower individuals or create obstacles for them.
• This research survey’s Practice score is much more valuable than its Leadership score because it’s a better determinant of the best advisors; it houses the lion’s share of differentiation.
• When you consider a MAP agency as an advisor, you incur one of the biggest risks of social business, constraining it to marketing- and promotion-oriented social media, which is relatively empty calories when compared to building relationships.
• Do not pick a “type” of advisory firm; look for a balance of leading edge thought leadership and walking the walk. MAP use social tools, but mostly to promote. Look at individuals’ presences, how proposed team members interact online with other people. Evaluate individuals more than organizations. Most agencies have professionals with business transformation experience at other advisory firms. The bottom line: look for proof: can the members of the team the agency proposes show that they have experience developing trust in public?
• Advising companies on using social business to transform their cultures, brand definition and operations requires the ability to interact with social technologies to increase trust and develop relationships.
• Most important, own your organization’s journey, don’t abdicate to any advisor. MAP agencies are weak across the Social Business Life Cycle, but their capabilities are strongest in Strategy and Pilot as shown in Score Distribution.

Beware These Risks

• MAP agency executives are knowledgeable about social media, and they are confident and convincing. However, as a category of advisor, they are only strong in a narrow part of the social business spectrum.
• Misalignment is major here. Unlike any other advisory firm type, MAP agencies face a severe disruption to their outsourcing and content-producing business model. The big hope in marketing is that “technology” and big data will enable content to be “relevant” at a new level. I predict that this will happen, but the effect will be short-lived because everyone will do it, and [the new "relevance]‘s ability to differentiate will dissipate rather quickly. Marketers and agencies will have to change profoundly. This won’t happen overnight, but steadily. If this makes sense to you, bring it up when you are exploring an agency as a social business advisor. Note the team’s attitude toward it.
• Mentoring is critical, and agencies aren’t known for it as a category. Another effective test for MAP agencies is asking them about their competencies in mentoring. Talk to their clients who have been mentored. If the agency is traditional, it may rely on outsourcing. Avoid these advisors unless you have a very good reason to undertake the risk of not developing your organization’s skills in sociality.
• The longer your organization delays real risk-taking and practicing, the more risk it engenders. Most executives will be happy to get intellectually smart, grace a few podiums, get quoted in advisor case studies and call it a day. They are doing themselves and their organizations a disservice.
• Few organizations appreciate the necessity of practice. Look for individual team members who put themselves out there, usually via blogs, but also in Google+, Twitter, on YouTube and on social networks.

Learning more

• Visit the Advisor and Service Firm Social Business Adoption 2012 home page to keep apprised of additional inquiries and insights
• The CSRA blog is long form; subscribe to the whole thing, a category or even a tag via RSS or email. See: http://rollyson.net/social-business-resources/#subscriberonly
• Get a more “stream of consciousness by following my Google+ profile: 
http://google.com/profiles/csrollyson

SWOT Analysis

SWOT analysis can be a useful tool to understand advisory and services firm strengths and weaknesses, especially to executives and professionals who have used it, so I have prepared Marketing/Advertising/PR agencies’ SWOT analysis in the table.

Marketing/Advertising/Public Relations Agencies’ SWOT Analysis
Strengths CMO relationships (in the context of marketing, not business consulting). Public and promotional cultures; staff skills relatively high with using social technologies for content creation, distribution, marketing and promotion. Account management and execution on behalf of clients is a core competency (outsourcing). Comprehensive competency with digital marketing techniques and technologies that can be complementary to social business. Average communication skills are the highest among advisory firms. Multifaceted people (“customer”) awareness and social knowledge.	Weaknesses “Management consulting” limited to marketing strategy. DNA is selling and marketing by creating and distributing content, which is diminishing in effectiveness and importance. Selling mindset can impede their ability to appreciate the importance of collaboration; they need to transform their people orientation away from “customers” to “collaborators.” Out of alignment with where the market is going: less managed, more authentic presence. Significant resistance to change among their employees.
Opportunities Retool social and behavioral insight into people’s desires and habits: help people achieve their desired outcomes, without selling; effective retooling would enable agencies to dominate a large part of the social business market. Advise CMOs on transforming the marketing function, away from “marketing” to relating and collaborating; this would be a feasible and profitable new direction for agencies that build consulting and transformation practices.	Threats Marketing/Advertising/PR agencies face far higher threats than any other advisory firms: social media and outsourced marketing will fall in prominence in the medium to long term. The shift in importance away from brand communications to individuals’ networks weakens the entire agency value proposition, which is creative communications that persuade. Agencies have a larger stake than any other firm category in transforming themselves.

• Strengths of MAP agencies are considerable when they reorient themselves and their clients away from selling to relating. Their people are the most comfortable with being in public. They have the strongest competency in behavioral understanding and with social technologies. In current practice, however, they are focused on talking, not listening, hence the necessity to “reorient.”
• Weaknesses are rooted in their legacy businesses: creating and delivering communications and content that promote and persuade on behalf of clients. Agencies need to reorient to supporting others’ communications.
• Opportunities are high for all advisory and services firm categories, but opportunities will flow to the few agencies that transform. Social media will continue to grow in absolute volume, but its profits will fall, and social business will grow faster. Agencies will not profit from social business until they transform and reorient themselves toward people—away from people-as-consumers of content and products—to people-as-collaborators whose voices are more powerful than brands (or agencies). Those that choose to transform can use their competencies in behavioral understanding, social technologies and communications to address the entire life cycle. Intriguingly, agencies that transform successfully will be in excellent position to advise their clients on an analogous transformation.
• Threats are dramatic because agencies’ legacy business will increasingly be under siege. Threats will materialize slowly at first, precipitating in lack of fee growth and industry consolidation. Visionaries will jump ship and join or create social business pureplays. However, enlightened agency leaders who aggressively build social business practices oriented to transformation could change the game. Once leaders move, others will follow.

Recommendations for MAP Agency Executives

Social business will transform society and business because it changes the economics of relationships, what people do and how they do it. Along with this, it will disrupt communications processes—away from centralized organizations to tribes of individuals who are leading the change, not organizations. This disruption will threaten agencies to the core, but visionaries that see it and respond decisively will emerge far stronger.

Using Social Business to Strengthen MAP Agencies

• Obviously these are general recommendations, and each agency is different.
• Give serious thought to disrupting yourself—the market will do it for you in the medium to long term regardless of your actions now. You can transform without weakening your legacy businesses by developing a separate business with a different culture. Recruit people with strong chops in business transformation, community management, Agile software development and sociology/anthropology.
• Another approach to transformation is partnering with a Strategy or Big Four firm. Such a partnership could work in theory, although it would not be easy in practice. The theory is, agencies have the people skills and social knowledge, and Strategy/Big Four firms have the business transformation expertise. To work, you would need strong leaders with experience in both firm types to build the combined practice. Commitment would have to be high for both parties; look for a strong tie to both firms’ business strategies.
• Agencies and advisory firms are talking about the shift in influence away from organization to individual, but the results of this research survey show that agencies are not showing that they understand it, as reflected by their behavior. More than any other advisory firm category, agencies could understand sociality if they would think differently about it. The biggest test is interactivity on a person-to-person basis.
• The most important thing to do is to learn how to make money when other people talk. Being real has more impact than glitz or “creativity” in a growing portion of use cases.
• Getting your firm’s hands (and arms and shoulders) dirty with being spontaneous and human in transparent environments is vital. Developing explicit competencies in trust building and relationship management at scale will be a huge driver of competitiveness in business. Agencies that recognize this and develop competency ahead of the pack will benefit enormously because social technologies are accelerators.
• Recruit leaders to launch a blog oriented to relating and facilitating others’ conversations. This can serve as a resource for broadening your culture beyond promoting and seducing target audiences. Show your competency by building extensive interactivity and community.
• Big brand clients will have limited appetite for living the disruption, which puts agencies in an awkward situation. Actively develop scenarios in which you can suggest to clients situations in which you can focus on less promotion by encouraging collaboration among client stakeholders. You need this as much as or more than your clients.
• Approach firm culture change head on. The way in which firms, and members within them, approach being human and public allows for significant variety, but it will require profound culture change at most agencies. The earlier you start, the better.
• It is difficult to overstate the profound change that is upon individuals and organizations. We primates are profoundly social; sociality is arguably our defining trait. Making sociality digital will change most human structures, organizations, patterns and habits. To remain relevant, MAP agencies need to be in the middle of it—as practitioners.
• Therefore, building social business capability in all parts of the life cycle is at least as vital from an R&D perspective as it is from a profit viewpoint. It’s a defensive strategy to adjust/sunset legacy businesses, and it’s an offensive strategy for developing new services.
• Social business capability will enable agencies to derisk how their existing businesses weather the storm. Clients’ needs will change profoundly, and seeing their evolution from the inside will be a significant advantage.
• Careful management can maintain existing profit margins for years to come, especially when agencies focus on how social business is affecting legacy practices.

Beware These Risks

• Do not be seduced by the continued growth of social media. It is the bright shiny horse that is leading the field now, but it will falter and be lucky to place in the medium to long term. Profitability will fall in the short to medium term and will not recover.
• Not starting the firm culture change early enough. “Creatives,” for example, will not want to cede primacy to people, but they will have no choice in the long term. Content will continue to play a role, but it will be much diminished.
• The Knowledge Economy is a more personal and public economy, and MAP agencies tend to be overly promotional and fakely positive (“advertising”). Obviously there is a spectrum, and firms will always have distinct cultures and approaches. Overall, though, firms will have to get real.
• Practicing social media and thinking that is “keeping you current.” The market overall validates social media because it hasn’t discovered social business yet. Sociality, relating to people, is far more complex and nuanced than promoting things to people. Make sure your agency appreciates the difference.

Learning More

• Visit the Advisor and Service Firm Social Business Adoption 2012 home page to keep apprised of additional inquiries and insights
• The CSRA blog is long form; subscribe to the whole thing, a category or even a tag via RSS or email. See: http://rollyson.net/social-business-resources/#subscriberonly
• Get a more “stream of consciousness by following my Google+ profile: 
http://google.com/profiles/csrollyson

The post Agency Report: Advisory & Services Firm Social Business Adoption 2012 appeared first on Christopher S. Rollyson and Associates.

This post originated at CSRA's blog. Please share your thoughts and comments here. Thank you.

[UPDATED] Analyst firms are go-to sources for emerging business and technology trends since they conduct constant due diligence on markets and technologies, which they sell via a subscription model. In addition, they are prodigious producers of content, conferences and other thought leadership activities relevant to social technologies, and a large portion of their employees produce and deliver content publicly (research, write, present), which strengthens their competency with social technologies.

As with most advisory firm categories, market leaders Forrester, Gartner and IDC are being challenged by analyst social business pureplays Altimeter Group and Constellation Research Group, while other firms hang back. This report also includes NM Incite, which is more of a market search firm, but it makes for an interesting comparison.

Advisory and Services Firm Social Business Adoption 2012 is a research survey that evaluates and quantitatively ranks the maturity of agency and consultancy social business practices. The survey ranks Strategy firms, Big Four, Marketing/Advertising/PR agencies, Analysts, Enterprise I.T. firms and Pureplays on their social business practices, service offerings and leadership—specifically according to their relevance for leading client organizations’ transformations to more human entities that are grounded in listening and responding, not marketing.

Capabilities

Given their core competencies in market research and analysis, reports, conferences and communications, Analysts rank highest in the early part of the Social Business Life Cycle. Their professional services tend the take the form of executive briefings. commissioned research reports and individualized research channels.

• Feasibility assesses the adoption of social technologies by a client’s stakeholders, so it emphasizes the market as much as the client’s readiness to implement social business. Although no analyst firm had a detectible Feasibility service offering, it is within grasp of their competencies. Their firm category has a Medium capability.
• Strategy conducts granular analysis of social venues, stakeholders’ social actions and client assets and business processes; therefore, it requires more specific knowledge of social technologies and behaviors than Feasibility. A valuable social business strategy requires strong knowledge of social business practice, and Analysts don’t exhibit high levels of social business practice, Forrester, Altimeter and Constellation being the exceptions, so they have a Low but discernible capability.
• Pilot involves guiding clients’ execution of social business strategy, so Analysts have less than Low because they have little if any capability in guiding client social business practice. However, they have higher than None because their employees show a higher than average skill with social technologies, which would enable them to guide client practice in defined areas.
• Scale focuses on forging mature social business programs by expanding Pilot. This is beyond the demonstrable capability of any Analyst firm studied. None.
• Integrate evaluates mature business processes in light of social business and integrates them or replaces the mature process with a social business process. This is even less within the capability of Analyst firms, so they had None.

Overall Score Distribution

Forrester leads Analysts by a wide margin on the strength of its Practice score. The top three analyst firms are tightly bunched in Leadership, which emphasizes talking about social business rather than practicing it. Thought leadership is square in their core competencies.

Interestingly, two new entrants, Altimeter Group and Constellation Research Group, are tied for second in Practice. They have relatively young leaders who are using social business prominently. Since they are building their brands, their Leadership scores are relatively low. Altimeter was launched in 2008 and Constellation in late 2011 by veterans of the big three.

IDC and Gartner have nascent analyst blog initiatives based on my analysis. They lack useful category and tag taxonomies to help users zero in on specific topics like social business strategy or organization transformation. Worse, Gartner analysts tag and categorize individually, which sabotages usability. Forrester’s blogs are one or two generations ahead. Relative to other firm categories, though, Analysts are ahead with using blogs and other social platforms.

Yankee lags in social business adoption as its scores were markedly lower than its rivals. That said, its Momentum score shows strong growth, so it seems to be getting on the social business bandwagon.

NM Incite is an alliance between Nielsen and McKinsey that focuses on social media analytics, so it is not a traditional analyst firm like the rest of the cohort, but it is included here due to its focus on analysis and market research.

Recommendations for Analyst Clients

As discussed in Capabilities, Analysts address a fairly narrow part of the social business life cycle, but they can add significant value to your social business initiative if you know what to expect. Here are my general recommendations for working with an Analyst firm on social business initiatives that emphasize organization transformation.

Partnering with an Analyst firm for Social Business

Many readers are undoubtedly Analyst clients and regularly attend their conferences in which Chief Analysts present case studies and co-present with clients who are practicing social media and social business. Analysts are recognized thought leaders and are very knowledgeable about emerging trends involving social technologies.

• Analysts offer clients an interesting mix of three ingredients: Strong understanding adoption trends, market forces and some of the technical aspects of social technologies, minimal experience with advising clients on the practical uses of social technologies, and strong Practice skills. Intriguingly, Analyst firms themselves use social technologies more effectively than Agency, Strategy or Big Four firms.
• Analysts in particular are strong in research and synthesis, remaining in the abstract. Theoretically, that enables them to cover emerging trends and to inform their clients more effectively.
• Social business uses digital tools for social transactions, but humanness and sociality are the differentiators; the technologies just provide mechanical tools to communicate and share being human.
• Sociality is difficult for professional services until they come to grips with this and change their orientation; as a 25 year veteran of professional services who hails from a medical family, I have had to go through that journey and appreciate how difficult it is. “Professional” connotes expertise, not “personality.” They do not have to be mutually exclusive, but most professionals will have to go through a period of synthesis to rebalance and learn how to be expert, conservative and human.
• There is very little awareness of sociality anywhere, especially in consultancies. Humanness is something people “practice” largely unconsciously, so it represents implicit knowledge and skills. To leverage its power, organizations and individuals must make it explicit to speed their learning process.
• Therefore, look for individuals, regardless of the logos on their business cards, because early adopters that practice and have explicit knowledge of humanness are your best leaders. Look at their blog posts: does a healthy portion deal with humanness, relationships, trust and sociality? Promotion is a small part of being human; don’t be seduced by clever wittiness. This is not to discount organizations, which can empower individuals or create obstacles for them.
• This research survey’s Practice score is much more valuable than its Leadership score because it’s a better determinant of the best advisors; it houses the lion’s share of differentiation.
• Keep in mind that one of the biggest risks is thinking you’re taking advantage of social technologies where you are not. Many of the social media early adopters who emblazon the covers of publications and conference podiums have succumbed to this pitfall. That’s not the meat, they are eating the bun.
• Do not pick a “type” of advisory firm; look for a balance of leading edge thought leadership and walking the walk. Among the Analysts studied, Forrester is the standout if you want an established brand. Regarding disruptions like social business, “established” is not generally a good indicator for relevant expertise.
• Given that Practice is so important, consider Altimeter and Constellation, which trail Forrester’s Practice score by single digits. Partnering with a new firm can be the best choice if you manage your side of the relationship appropriately. You may well find more bleeding edge thinking and practices at the new firms, but they generally suffer from a lack of support and consistency in their business processes. I speak from experience because CSRA is a boutique. Ask about these and pay attention to body language. Make sure people are being transparent.
• Even more important, own your organization’s journey, don’t abdicate to any advisor. Analysts’ strongest capability is noting, interpreting and advising on emerging trends, so they can be valuable partners. As Score Distribution indicates, think to use Analysts during Feasibility and some aspects of Strategy, where their capabilities resonate strongest with the Social Business Life Cycle.

Beware These Risks

• It would be easy to partner with an Analyst to talk about and understand more than practicing social business.
• Organizations, in the outdated Industrial Economy view, are impersonal places, and the Knowledge Economy is changing that. All organizations need to go through a period of “humanization.” That means practicing, looking foolish, learning and adjusting in tight cycles. Practice is paramount.
• The longer your organization delays real risk-taking and practicing, the more risk it engenders. Most executives will be happy to get intellectually smart, grace a few podiums, get quoted in advisor case studies and call it a day. They are doing themselves and their organizations a disservice.
• Few organizations appreciate the necessity of practice. Look for individual analysts who put themselves out there, usually via blogs, but also in Twitter, on YouTube and on social networks.

Learning more

• Visit the Advisor and Service Firm Social Business Adoption 2012 home page to keep apprised of additional inquiries and insights
• The CSRA blog is long form; subscribe to the whole thing, a category or even a tag via RSS or email. See: http://rollyson.net/social-business-resources/#subscriberonly
• Get a more “stream of consciousness by following my Google+ profile: 
http://google.com/profiles/csrollyson

SWOT Analysis

SWOT analysis can be a useful tool to understand advisory and services firm strengths and weaknesses, especially to executives and professionals who have used it, so I have summarized Analysts’ as a firm category in the table.

Analyst Firms’ SWOT Analysis
Strengths Assessing market trends specific to technology maturity. Noting and predicting technology adoption by market participants. Preparing, producing and delivering a wide range of thought leadership. High scores in Leader blogs, Sociality; most employees are communicators.	Weaknesses Advisory capabilities limited to research and some strategy. Not experienced with leading clients through business process and culture transformation. Little core competency to grow into “hands-on consulting” that clients require.
Opportunities Developing sophisticated metrics and understanding of sociality; most social media metrics are of nominal value because they don’t reflect changing trust, relationship and commitment. Distilling good practices from employee skills with social technologies. Offering good practices to clients as a consulting offer.	Threats Technology vendor selection may become less important as technologies go cloud and are available in small increments. This may lower market demand for technology analysts. “Open source” collaboration with social technologies could weaken some Analyst research offerings in some use cases.

• Strengths of Analyst firms have been discussed at length but are included for completeness.
• Weaknesses have been mentioned, but clients can mitigate Analysts’ weaknesses as long as they recognize them and get Strategy, Pilot, Scale and Integrate expertise elsewhere. Beware of Analysts that may claim expertise they are growing into. All advisors learn during client work; just be sure you understand their level of expertise. Analyst firms that want to expand into Strategy can be congruent if they make this explicit. CSRA, for example, has a Beta Program for new offerings. We disclose to clients why we think we can add value, but we share that it’s a new area, and we charge them a special Beta Program rate.
• Opportunities are exploding for Analyst firms. Social technologies accelerate market volatility and change, as described in the Social Channel. Their research and analytical capabilities are becoming more relevant, especially for Analysts that pivot toward sociality, which will usurp value from “technology” tools. Cloud will homogenize technology, so fewer clients will require the level of analysis they do today. However, sociality is far more complex and nuanced. Analysts can innovate by partnering with clients to develop metrics for sociality. The metrics used in this Research Survey can serve as an example. In addition, Analysts may want to experiment with mentoring clients in executing Strategy during the Pilot part of the life cycle. There is a huge vacuum in sociality that Analysts could exploit, but capitalizing on it may require a significant culture change.
• Threats are largely grounded in Analysts’ traditional focus on technology. If Analyst executives are snoozing, they may awaken to a bloody ocean. More than most, however, Analysts are aware of market developments.

Recommendations for Analyst Executives

Social business will transform society and business because it changes the economics of relationships. Generally, volatility is beneficial to Analyst firms because it creates more change about which clients require education and guidance. That said, the kind of change that makes a difference is changing.

Using Social Business to Strengthen Analyst Firms

• Please accept these as general recommendations; each firm is different.
• Since Analyst firms are strong in their own skills with social technologies, think about codifying staff skills and creating consulting offerings, especially in the Strategy part of the Social Business Life Cycle.
• To the extent that your firm is grounded in “information technology,” treat it as a cash cow and note the blood in the water.
• Careful management can maintain technology-related profit margins for years to come, especially when Analysts focus on homogenizing technology. Fall out of love with the technology itself, however.
• If your firm’s mission abstracts above the technology, it is likely that you are about empowering clients to use the tool to achieve a business impact. Most Analysts have been relatively hands-off with Practice.
• Consider developing explicit social business Practice expertise as discussed in this Research Survey. A good start would be codifying your employees’ skills and practices with social technologies. Once codified, you would begin exploring service offerings.
• As will unfold in this research survey, Analysts don’t have the mental baggage of the Big Four firms, whose audit and tax practices are regulated. Analyst firms have more mental mobility. However, I have seen most major firms try their hand at “consulting,” taking a more hands-on advisory role. It has not worked in general, but that doesn’t mean it can’t.
• Management consulting, whether at Strategy or Big Four, is largely grounded in quantifying analysis. This will be of limited value in social business, which is about scaling trust and relationship with digital tools. Therefore, astute Analyst firms could be strong players in the huge vacuum that exists today. Firms that want to be strong players will invest aggressively.
• Anticipate and empower culture change. Analysts epitomize “knowledge workers” and increasingly have individual reputations that may dwarf organizations in fast-developing areas like social business.
• You will be better able to engage stars if your firm redefines itself as a platform for individual analysts to develop their careers. Optimize your roles to empower individuals. This requires jettisoning paternalistic attitudes that pervade Analyst firms, agencies and consultancies.

Beware These Risks

• Basking in the water that gets ever-so-warmer each quarter. Those who do will end up on the plate.
• Not letting go of technology. Again, Analyst firms will make extensive profits covering technology, but make sure you’re grounded in the sunsetting reality (for most of your offerings).
• Practicing social media and thinking that is “keeping you current.” The market validates social media because it hasn’t discovered social business yet. Sociality, relating to people, is far more complex and nuanced than promoting things to people. Make sure your organization appreciates the difference.

Learning More

• Visit the Advisor and Service Firm Social Business Adoption 2012 home page to keep apprised of additional inquiries and insights
• The CSRA blog is long form; subscribe to the whole thing, a category or even a tag via RSS or email. See: http://rollyson.net/social-business-resources/#subscriberonly
• Get a more “stream of consciousness by following my Google+ profile: 
http://google.com/profiles/csrollyson

The post Analyst Report: Advisory & Services Firm Social Business Adoption 2012 appeared first on Christopher S. Rollyson and Associates.

This post originated at CSRA's blog. Please share your thoughts and comments here. Thank you.