How Online Social Networks Benefit Organizations

By Lisa Kimball and Howard Rheingold

(Join us for an online discussion of online social networks in March-April)

In order to develop a strategy for its future, an $8-billion energy company needed to identify the forces that would influence its industry. Previously, the company had used outside consultants to conduct a scenario building process with the top 15 corporate officers. Results were disappointing - final reports sat on the shelf. To make a real difference this time, the process had to go deeper and involve more people across the company to get grass-roots buy-in for recommended changes.

It wasn't feasible to convene an all-hands meeting, and the company was in a hurry. So they opened an online network to connect people at all levels and from all parts of the company in a discussion about the business environment, economic trends, and technology developments that could affect their ability to succeed.

In addition to the expected benefits of generating an abundance of ideas and engaging a broad range of people in the company in the strategic planning process, the online network had a profound effect on the organization. During the course of the project, a major crisis occurred when there was a break in the pipeline. Activity online immediately jumped to an intense level as people logged in to find out what was happening and contribute ideas. People felt involved and that they were better able to cope with the crisis because they had timely and accurate information about what was happening. It changed the nature of the organizational conversation almost immediately. As one participant put it, "For the first time I know what's in the minds of my colleagues on a day-to-day basis."

Online social networks are webs of relationships that grow from computer-mediated discussions. The webs grow from conversations among people who share a common affinity (e.g., they work for the same company, department, or in the same discipline) and who differ in other ways (e.g., they are in different locations, keep different hours, specialize in different disciplines, work for different companies). When the people are distributed across time and space, then these conversations need to take place online, over an intranet or private internet forum.

Within a company, a well-tuned online social network can enhance the company's collective knowledge and sharpen its ability to act on what people know in time to be effective. We have long recognized that this kind of network is critical to an organization. Creating these opportunities to connect is often the stated or unstated purpose of facilitated off-site meetings and other communication initiatives. However, the half-life of connections made at these meetings was very short until online technology provided us with a means to support the network over time.

Social networks grow from the personal interactions of human beings over time, as well as from from the technological infrastructure that connects those humans. This means that growing a successful online social network requires social know-how as well as technical expertise. Interactions include those that take place face-to-face, via telephone, online, and even via things we send each other in the postal mail.

Thoughtfully planned and knowledgeably implemented online social networks can enable an organization to:

1. Create an early warning system.
2. Make sure knowledge gets to people who can act on it in time.
3. Connect people and build relationships across boundaries of geography or discipline.
4. Provide an ongoing context for knowledge exchange that can be far more effective than memoranda.
5. Attune everyone in the organization to each other's needs – more people will know who knows who knows what, and will know it faster.
6. Multiply intellectual capital by the power of social capital, reducing social friction and encouraging social cohesion.
7. Create an ongoing, shared social space for people who are geographically dispersed.
8. Amplify innovation – when groups get turned on by what they can do online, they go beyond problem-solving and start inventing together.
9. Create a community memory for group deliberation and brainstorming that stimulates the capture of ideas and facilitates finding information when it is needed.
10. Improve the way individuals think collectively – moving from knowledge-sharing to collective knowing.
11. Turn training into a continuous process, not divorced from normal business processes.
12. Attract and retain the best employees by providing access to social capital that is only available within the organization.

Online Social Networks As Early Warning Systems

The explosive multiplication of an individual's ability to find answers to questions is one of the most powerful benefits of an online social network. Search engines find facts. People provide solutions to problems. Networks of people can solve problems for each other. Online networks accelerate and globalize the process.

Each person in a network knows more than anybody else in the network about at least one special interest and can provide useful knowledge when questions arise concerning their area of expertise. No person is an expert on everything, so we must rely on the expertise of others. But getting the right answer in time isn't easy. First, you need to know "who knows who knows what" in order to ask the question. Second, you need a reason for the people who know the answer to share it with you. When your network includes hundreds of people who have a productive relationship with the online social network you share and feel favorably inclined to answer questions within the network, your ability to get questions answered quickly multiplies exponentially.

Answering questions is powerful, but reactive to problems rather than proactive toward future learning. Far more powerful is active information seeking by individuals on behalf of others in the network. When all the people in such a network actively scan their personal information-streams for early indicators, and feed their findings into the community memory, it makes it possible for every person in the network to know much earlier about blips out on the horizon, events far from their specialty that could have immense impact on the entire organization in the future. Most people engage in this activity in an informal, disorganized way – we send URLs and snippets of information to people we know who are likely to benefit from them.

A company that has a good early warning system won’t miss opportunities or fail to meet challenges quickly enough. Clueless organizations in many industries were surprised when PCs turned out to be a big thing, because they had no way of absorbing that knowledge systemically, through their own employees. Even though some people inside of the organization undoubtedly knew the shape of the future and were talking about it, they had no way to get it to decision-makers.

An online social network and knowledge community can strengthen an organization's ability to understand the ways in which different parts of the system interact, so that somebody doesn't, for example, make an engineering decision without being aware of the financial impact or marketing doesn't know that it will take longer for a product to move through the pipeline than originally planned. Online social networks alert people to the things that collide when someone’s got a good idea but doesn't know what’s going on elsewhere, or how their idea affects other's plans or resources.

When individuals (or groups) in the organization notice changes emerging in the work they have been doing, it’s critical to make this "intelligence" available to the organization as a whole. whole.

For an early warning system to be effective, communication must be timely. Waiting for the next face-to-face meeting may be too late - opportunities are lost, problems get worse. Communication also needs to be "Push" v. "Pull" to make sure that nobody misses a key indicator. It's not enough to simply place information in some kind of archive and hope everyone who needs it will find it. Instead, organizations need a means to convene people across the organization and get information and ideas about key trends in front of them.

The danger for distributed organizations is that a weak communications strategy results in missed signals where something new happening in one place could be a bell weather for something that will sooner or later have an effect on other parts of the system. An organization that doesn’t share this kind of intelligence is less than the sum of its parts.

The organization needs a strategy for scanning and scouting the environment within which they are operating. It needs a strategy for noticing pattern changes to make sure that important things get up on the organization’s radar screen soon enough to make a difference. But it’s not enough to simply report the information, it’s critical that all groups and stakeholders have an opportunity to discuss its meaning.

Online Social Networks Get Knowledge to People in Time

A large teachers organization was a leader in developing and promoting new standards for teaching math at all levels. But they knew that getting teachers to adopt the significantly new ways of teaching required wouldn't happen just because the standards were published. Summer institutes and other training programs could only reach a small number of the tens of thousands of math teachers in the U.S. The organization partnered with public television in an initiative to produce and distribute a set of videos that showed real teachers in real classrooms using the new ideas. According to Donald S, an author in the field, professionals learn best when they have the opportunity to apply knowledge, reflect on their experience, and get feedback from peers and mentors. But a teacher's schedule doesn't provide any time for conversations with peers during the day and they don't have a lot of energy for meetings at the end of the day. So the set of videos created an online social network of learning communities of 25-30 teachers with a peer facilitator who watched the videos, tried ideas in their classrooms, and got online to talk about their experience.

Having the online space made it possible for teachers to share experiences with each other, about which new approaches were working, which were not working, and how they felt personally and professionally about the changes. Great ideas that were working in a fifth grade classroom in Texas could be used by a teacher in Illinois. As one math supervisor said, "Simply accessing information about different lesson plans and new techniques would not have been nearly as useful as hearing from a fellow teacher about something that really worked with real kids. That's where the rubber meets the road. That's what makes a teacher willing to try something new."

One person may know something that many other people need to know, and in the course of events, maybe only that person knows it, unless they participate in communication activities that cuts across time and space and departmental boundaries. It’s not just a matter of locating and transferring the specific knowledge, it’s more a matter of setting up the kind of nervous system that can survive and thrive in an atmosphere where you are changing your business practices regularly. You must build in ways to encourage and stimulate people who know what’s going on to diffuse that knowledge through the organization.

Well-designed online social networks provide a vital context to knowledge exchange that can make the exchange more potent and widespread than a traditional memorandum. It’s not just that you’ve put the word out, "Now we’re going to sell men’s suits," so now everybody knows what to do. Much more ambient knowledge needs to provide the context to help people perceive the trim-tabbing or shifting that’s going on in the organization and make all those micro-adjustments in what they’re doing in order to stay aligned. They need their antennae out in different parts of the organization, and they need ways to attune other parts of the organization to their own needs and capabilities.

You don’t confine exchange of useful knowledge to a meeting or a chance encounter in the hallway. You create a place where, when you see something in the world that’s useful because it relates to a conversation you know is taking place in your online social network, you don’t have to wait until the meeting on Tuesday, or you didn’t miss it because the meeting was last Friday, there’s a well-known place to put that information. You multiply the amount of useful knowledge that’s exchanged by not confining it to a synchronous meeting.

You also make explicit and available the kind of lore about how things are done that’s always hidden in pockets of places and usually shared only with people who know exactly who to ask. Useful specific knowledge is available to 90% of an organization, rather than 1%.

Online Social Networks Connect People Across Boundaries

For most global corporations, establishing effective avenues for improving collaboration across the enterprise is strategic. Fred S, Director of Learning and Knowledge Management at a major computer company felt that finding effective ways to share knowledge throughout the organization was key to the company's ability to develop and unify common business unit strategies. The company had many powerful tools that were very effective in supporting teams and workgroups and for collecting and storing information that could be accessed company-wide. But creating an online social network within which to convene managers for conversations and knowledge exchange added something valuable to the mix. The online social network provided a venue for storytelling, showcasing projects and best practices that could be leveraged to create new knowledge resources.

More importantly, the opportunity to meet others working on similar issues creates relationships that can shortcut the important process of figuring out where to go in the organization when you need help on a particular problem. According to one participant, " We need to share knowledge between divisions within our group, and across [company] divisions on how our processes and products relate. As the Reengineering Leader, I am someone who needs to figure out how we can effectively deploy Knowledge Management methodologies, processes, and supporting tools to our group in this context -- this seems to fit right in to tying us all together."

People who should be talking to each other because their interests intersect often don't communicate because they are in different parts of the world, different floors, or different departments. Online discourse structures discussion according to interests and affinities. Engineers around the world can share lore, or people from engineering, marketing, and design can try to get their arms around a project they are all approaching from different directions.

Asynchronous conversations cross communication boundaries of other kinds. The quiet people who might never have something to contribute in a face to face meeting, given time to compose their thoughts, with nobody watching them while they do it, can influence discussions they might not have joined before.

A global pharmaceutical company identified high potential managers in different regions as an advisory group for top management. Their periodic face-to-face meetings were interesting and enjoyable but they felt that somehow the group should be able to have a bigger impact. When the group was convened as part of an online social network, they were struck by the potential value of being connected continuously rather just for a few hours every few months. But, perhaps more importantly, they "discovered" one of their members in a new way. Because English was not his first language, he spoke with an accent, and had a very soft voice he had not been a very active participant in face-to-face meetings and people didn't have much of a sense of his experience and ideas. Online, his contributions were brilliant and his peers were very excited about the new ideas and insights he brought to the table. One of his colleagues said, "Now that I have gotten to know him online, I am very motivated to take the time and make the effort to HEAR him in our face-to-face meetings."

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© 2000, Rheingold Associates