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Overcoming the fear of connectivity

Alan Cane
Financial Times
28 May 2009

Some organisations, fearful of untoward consequences such as reputational damage, ban social networking websites – Facebook and the like – from their premises. Others embrace them enthusiastically and try to persuade others to do likewise.

One such is IBM; not the IBM which cowed the computer industry back in the 1970s through a mixture of fear, uncertainty and doubt but a global IT services company with a manufacturing operation attached. It is, in fact, one model of a modern interconnected company.

“We are really encouraging our employees to use social software and social media internally and externally to link up with clients and suppliers,” says Gina Poole, the company’s vice-president for what IBM calls social software programs and enablement.

“We have thousands of IBMers active on Twitter (the micro-blogging website), tens of thousands who are blogging both internally and externally and hundreds of thousands who are active on social networks like LinkedIn and Facebook.”

She explains there are four elements to IBM’s commitment to connectivity. First, internal networking using tools both commercially available and experimental that IBM itself has developed. Second, connections between internal networks and external networks through ibm.com. Third, participation in external social networks; and fourth, moves to persuade IBM’s customers to take similar initiatives.
Ms Poole leads an IBM initiative called BlueIQ which seeks to harness the collective intelligence of the company to improve service to customers and partners. A group of early adopters of connectivity, the “BlueIQ ambassador community” spreads the word.

Key to successful social networking, Ms Poole argues, are guidelines. They lay down, for example, that IBMers are personally responsible for the content they publish; among other conditions, they have to identify themselves as company employees and are duty bound to correct their mistakes. “We have had no problems,” Ms Poole says encouragingly. “These guidelines reduce the level of risk and liberate rather than inhibit.”

No business sector can remain insulated from the spread of connectivity. This month the Gartner Group warned the banking industry that it had to be ready to take advantage of the “new age of social banking” – in which depositing, lending and the connections between depositors, borrowers and financial institutions are transparent and modelled on social networking.

Stessa Cohen, research director at Gartner, said such connectivity had been characterised by speed of growth and viral impact: “Ideas are picked up, established and disseminated within short time scales, much too short to allow late entrants to the market to take advantage of the opportunities that will arise. Banks need to be positioned to take advantage of this shift to a new age of social banking.”

For many companies the prospect of opening their boundaries to the outside world remains frightening although, as a recent paper from the McKinsey consultancy points out: “Technology now allows companies to delegate substantial control to outsiders – co-creation – in essence by outsourcing innovation to business partners that work together in networks. “By distributing innovation through the value chain companies may reduce their costs and usher new products to market faster by eliminating the bottlenecks that come with total control.”

So the case for connectivity and communication in business has been well made. But it remains on the leading edge where ground rules have yet to be set in stone. Some fears are well-founded: Rob Gear of PA Consulting argues that ill-considered openness can lead to competitors learning of initiatives that should be kept confidential.

Worse, it could lead to customer expectations that cannot be fulfilled. And customers can be sensitive about the kind of personal information companies would like to collate to help them target their marketing.

There has, for example, been an outcry in recent months about Phorm, the company which was collecting the web-browsing habits of some British Telecom and Virgin Broadband customers for marketing purposes. The mistake it made, Mr Gear points out, was not to tell those customers what it was doing.

Rob Bamforth of the consultancy Quocirca worries that there is little resilience, little insulation from shocks and changes of direction in a hyperconnected world. In a highly connected business, a shock to one part of the system can cause a disastrous resonance elsewhere: “To my mind, this means imposing some kind of control or choke point.

“There is the opportunity to use technology to provide additional layers of social connectivity that an organisation previously has not had. There has always been the ability to telephone someone, but the large enterprise telephone directory does not tell you why you might want to call somebody or who to call in the event of something happening. The connected enterprise can allow that connection to take place.”

He warned furthermore that vendors of connectivity tools were concentrating on their own technology at the expense of interconnectivity between tools from different suppliers: “In the real world there is a need for a federation of high level services from multiple vendors. We seem to be at an early stage of that level of interoperability,” he said.

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