I was recently invited to submit an article for Connect-World Asia Pacific. Connect-World is a series of magazines that offers a forum where the highest-level decision makers in the telecommunications and information technology sectors discuss their opinions about the impact of technology on Global and regional development. Connect-World's audience (writers and readers) are leaders of industry, governments, international organizations, legal experts, bankers and the like.
The theme for the issue of the publication that I was asked to write for was 'Convergence, communications and business innovation.'
I had the great pleasure to work closely with my colleauge, Peter Auditore, who contributed significantly to this piece. The article is called “Social Networks and B2P.” Below is the article as it was published:
Social networks and B2P
by Donald Bulmer, Vice President Global Communications, SAP AG
The Internet has rapidly expanded to become a global network of seamlessly connected computers and devices that has revolutionized information sharing and communications, challenged governments,broken down cultural barriers and driven innovation and business velocity to levels never before imagined. One of the most important successes of the Internet is how it is enabling globalization and more importantly business model innovation. Today’s most successful companies are driving product and business model innovation from outside their own walls by leveraging the Internet as a collaborative community-building platform. This platform has allowed organizations to harness the innovation power of the community and not just individual innovation; some notable examples are Topcoder.com and Innocentive.com.
With the execution of business-to-business (B2B) and business-to-consumer (B2C) ecommerce over the last ten years, the Internet has enabled companies to create, build and maintain rich and vibrant ecosystems of partners, suppliers and now social networks. At the centre of these ecosystems is the customer who has indeed benefited the most from these advances. However, we are now entering the age of business-to-person (B2P) communications, which is the result of Web 2.0 based social networking platforms that give new power to the customer and the communities of interest that form around them.
The astronomical growth and evolution of platforms such as BeBo, Facebook and MySpace reflects the success of Web 2.0 technologies; more importantly it illustrates how digital natives will expect to interact with and use software applications in the future.
This is just the beginning as a new wave of professionally oriented social networks have begun their evolution, most notably, Twitter, LinkedIn, Plaxo, Namyz and others. What is most surprising about the emergence and growing influence of social networks is that they did not emerge from the innovative Internet giants of Google and Yahoo.
Social networks and Web 2.0
The first social networking platform to emerge from the TCP/IP Internet protocol suite was the Network News Server in the early 1990s. This was a relatively primitive system used extensively in many engineering organizations to post projects and share information via email between geographically dispersed groups. Engineers are very much today’s digital natives and are more likely than most to join and participate in forums such as our developer network forum where 1.4 million developers, partners and customers regularly answer questions and share their knowledge.
Digital natives armed with mobile devices are by nature highly collaborative and they were quick to latch onto the inherent value of social networking within their age groups and cultures. In fact, many of the first social networks formed around specific age and peer groups. These networks brought together communities of users such as Nintendo and Wii users and, within Gather.com, book lovers and writers. Members of these networks now interact using these platforms throughout their daily lives via their highly enabled mobile telephones. The introduction of the iPhone transformed the mobile phone into a new computer platform for social interaction.
There are many varieties of social networking types - they tend to coalesce around common social, cultural or professional interests:
Cultural and age group specific
• Gather (30-40 year olds)
• EONs.com (Baby Boomers)
• Bebo.com (Teens & Young Adults)
• LinkedIn.com (reportedly 20 million members globally)
• InsightCommunity.com (formerly Techdirt.com)
Charlene Li, formerly an analyst with Forrester, expects that in their next stage, in five to 10 years, social networks will be ubiquitous - sites will, “be like air: They will be anywhere and everywhere we need and want them to be.” Eager estimates there will be as many as 250,000 sites that call themselves social networks within a year, compared with about 850 today. “Everyone will reposition their site to take advantage of this phenomenon. It happened before with portals.”
Social networks - the centre of the B2P ecosystem
Today’s global network of connected devices enables multi channel access for customers, partners and suppliers and is delivering on the promise of a virtual work environment for employees worldwide. The global network convergence is also creating a significant challenge for enterprise application vendors who have deployed a wide array of business critical applications for large and small businesses. For traditional vendors of enterprise applications and software-as-a-service (SaaS), the key issue will be integrating mobile devices with business critical applications and providing transparent access to the date that supports the underlying business processes. The convergence of data, applications and mobile technology is forming a powerful platform. This platform will not simplify business processes; it might make them easier to use, but it will make them inherently more complex and powerful and will have far-reaching implications. Concepts such as cloud computing, SaaS and business process utilities (BPUs) are foreign, and often confusing, to many business executives especially in small and medium businesses. More importantly, however, this convergence is providing customers, partners and suppliers with real time access to social networks and the brand experience that will be driven within them.
Social networks are radically changing the way we do business and are, in themselves, new ecosystems, virally creating communities within communities that are driving brand recognition and brand experience. Social networks are now being leveraged by sales executives to understand the networks of prospects and leads and customers in the realm of B2P marketing and sales. Social networks facilitate and automate vast interactions, connections and networks of people by
enabling collaboration with colleagues, clients and suppliers anywhere and at any time. This new paradigm completely eliminates the need for travel, and these platforms incorporate a rich suite of evolving Web 2.0 applications.
The impact of these far-reaching social networks on business is becoming clearer every day as millions of consumers, partners, suppliers and businesses discuss and share their brand experiences. Enter the new B2P paradigm. According to Mohan Sawhney of Northwestern’s Kellogg School of Business and recent author of The Global Brain, “Social Customers are driving Innovation, they are empowered and collaborative, they are drivers and initiators of effective innovation and are increasingly viewed as a strategic asset to companies. Today’s customer is looking for a personalized experience and relationship, demanding solutions rather than products.”
Myventurepad.com is a social networking site where small business owners can share and consume information that is important to their businesses. Venturepad.com was the industry’s first social network for small business owners.
Since its inception in November 2007, MyVenturepad.com has grown month after month and now has 1000 small to mid-sized company members; its newsletter has a weekly readership of over 1,200. Top visitors to the site include companies from Germany, Brazil, India, UK Canada, Australia, the Netherlands and the US. There are currently over 79 active blog feeds and the site averages 10 new bloggers per month.
The Internet has radically changed the landscape of business and has challenged government control of people and information. It is the most significant inflection point in communications industry since the telephone.
The progress in Web 2.0 technologies has enabled the development of virally driven platforms, facilitating a new era of social networking and media. These technological advances have disrupted the status quo of business and communications on a global level and have offered new opportunities for commerce by harnessing the social influence of online communities. In these communities, people access, interpret and are influenced by information made available by other participants with whom they collaborate and share experiences.
As part of the social-media phenomenon, the demands of consumers of all types have increased; they are calling for greater transparency and accountability in a way that no company, government or even individual can escape. This is facilitated by the emergence of a 24-hour global cycle of news, information and dialogue, accessible online anywhere and anytime.
Compounding this, globalization, increasing energy and commodity costs and global economic restructuring have forced companies to expand into new markets, adopt new business models - new products, services and geographic reach - and optimise business processes to more efficiently manage costs and expenses. This has created hypercompetitive markets.
As we enter the era of B2P marketing communications, those organizations that harness Web 2.0 technologies and platforms to enable business-to-person communications will be the winners. Laggards that do not understand the value of social networking and its appeal to the emotional side of customer relationship management will lose competitiveness and, ultimately, market share. The era of B2P marketing harnesses the new and deep connections that are forming between customers, products and their suppliers. Peer groups, associations and social networks are now one of the most powerful influencing mediums in the world.