Social Business Supports the Next Wave of Productivity in Manufacturing

By Heather Ashton – December 13, 2012
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At IDC Manufacturing Insights, we've begun to see a shift in manufacturing -the next wave of productivity, supported by the four pillars (big data, cloud, mobile, and social). Social business is an important component in this new "house of productivity" that manufacturers need to create. Manufacturers are bringing Twitter-like and Facebook-like and Linked-in-like capabilities into the business culture, their processes, and their existing applications as well as upgrading their existing collaboration tools. What exactly is social business, then? I like to use the distinction that social business is conversation-based and people-centric, rather than task-based and file-centered.

 Implementing social software does not make a social business. Technology is a key enabler, but the transformation into a social business requires changes in all aspects of the business. To this end, though, the proliferation of social software inside corporate walls today signifies that the social business transformation is starting for many companies. Consider that Yammer, a popular social software platform, has penetrated 85% of the F500 companies. Social is going to be a big part of this productivity wave already gaining strength today, and manufacturers need to create a strategy around social business to get the most value out of this wave.

When we asked manufacturers at the beginning of 2012 what the top three drivers were for using social media, they responded that increasing product awareness (49%) and gathering feedback from customers (47%) were the two most important drivers (see Figure 1). This was a shift from 2011, when manufacturers were focused on identifying partners or prospects.   It's also interesting to note the results of another data point from this same survey, framed in the same "social media" context. We asked what departments will utilize social media most inside manufacturers, and the overwhelming majority answered marketing (79%) and sales (60%).

We believe these two points reflect the connection manufacturers have made between social media and marketing and sales, using social software to deliver a cohesive brand message, to provide a single source of truth around their brand and products, and to monitor what their customers are saying to protect that brand.  This combination of "outside-in" and "inside-out" is an important component of social business.  Manufacturers are getting a lot more sophisticated in understanding how to use social media, but we know this data doesn't paint the big picture for social.   In our upcoming survey we'll ask manufacturers these questions in terms of social business, not just social media, and we expect to see a stronger link to some of the promising use cases developing in social business.

At IDC Manufacturing Insights, we have anecdotal evidence that social is moving elsewhere throughout the manufacturing organization, and there are some powerful use cases that illustrate that move. Here's a look at the six most popular social business use cases in manufacturing today:

  • Customer experience management - This is where social often makes its first meaningful landing inside the manufacturing organization, focused on unifying the customer experience through all the various touchpoints with a manufacturer (reflecting the marketing and sales outcome referenced above). Manufacturers with greater proximity to the end consumer tend to focus their priorities on customer experience, creating interactions when, how, and where the consumers want them.  Social media provides manufacturers with a means of engaging with the consumer in a way that offers a consistent message and aligned brand experience.
  • Socialytics - This refers to the broad category of analytic tools and applications that can be used to analyze social data that is being created through socially based interactions and understand customer sentiment. Manufacturers are using socialytics to apply behavioral modeling to this data and gain insight into past, current, and future actions of both internal and external stakeholders.
  • Innovation Management - This refers to the practice of applying social tools to product development. Considering the often distributed nature of product development in many global organizations, social tools can enable team members to locate experts, share best practices, and broadcast questions or updates to the development process of a particular product, often through the same interface the developers are using to work. Manufacturers are also investing in creating a "digital thread" throughout the product lifecycle to support visibility, collaboration and high fidelity decision making.
  • Digital commerce -This new form of commerce is omnichannel in nature, combining e-commerce and traditional commerce and relying on a common platform from which suppliers, partners, and customers can gain access and participate. The goal of digital commerce is to elevate the consumer and end-user experience.
  • Enterprise social network (ESN) -This represents a wider group of social applications, standalone or embedded in other applications, that facilitate the connection of people inside and outside the firewall. ESN will become the social backbone by forming a relationship layer across the business to facilitate information sharing and collaboration in the context of work processes.
  • Talent Management - This is all about empowering human resources with social tools to leverage technology for more effective recruitment, education, and retention of talent in an organization. It provides a context-driven, people-centric view of the human capital inside a manufacturer. Talent management enables recruiters to leverage social networking sites to locate external job candidates while also using enterprise social software to broadcast job openings internally, feeding employee referral programs, and vetting candidates.

As manufacturers begin to build their house of productivity, focusing on how the four pillars intersect will deliver the greatest productivity gains. Take, for instance, the intersection of social and big data, which yields Socialytics, one of the uses cases cited above. The intersection of social and cloud enables the enterprise social network use case.  Manufacturers that develop this awareness of combining technologies to increase the benefits of social will begin to push their enterprise application vendors to embed more social functionality into existing applications. There will also be a call for better integration of social throughout the enterprise software suite.

We have a series of research efforts underway in social business and its impact on and adoption patterns in manufacturing. Stay tuned for more research on how manufacturers are transforming into social businesses.


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