Thursday, February 20, 2014

The death and rebirth of social business

Social business was dead ... and it has been born again as social media management systems. The question is, apart from VCs, who stands to gain from this transfiguration?



This posts stems from the acquisition of Dachis Group by Sprinklr, or, if you wish, the acquisition of social business by social media management. 

It was a matter of time. For those who have followed Dachis Group, you have to admire their medium-term strategic view and their decision-making capabilities. I remember a Dachis Group that was more of a consulting company, pioneer in the use of the term social business. Then, it came as a surprise to many of us that they would turn into a software and service company, targeting the external social business arena, instead of the deep transformation that many thought had to occur first within our corporations.


At the beginning of 2013, I was a bit ahead of the pack when writing about "The Year we Kill Social Business". I remember writing : 

"when looking at what has been written this past year on the impact of social technologies, what comes to mind is productivity and engagement. Why? Because the industry seems to have moved towards "social enabling processes" and "engagement and advocacy".

The idea here was to take stock of the fact that, unable to prove its unique value proposition to the corporation, social business (the use of social technology within a corporation) was trying to tie its impact to well-known corporate spaces, like process improvement (measured by productivity gains) and marketing (measured by increased sales and brand awareness). And, following, players were having to choose their positioning. 

From a financial strategy point of view, it became an easy game for software players: becoming an acquisition target for one of the established vendors. The big software players started consolidating social in 2011, with incumbents like SAP or Oracle buying cloud or social vertical specialists like Taleo or SuccessFactors, and it is continuing today, with vendors in the "engagement and advocacy" space merging among themselves to get ready for the big acquisition. It makes perfect sense from a VC point of view.

And yet, when I wrote at the time of the Success Factor acquisition by SAP :


 "I am more worried that, in so doing, it is also the process specialists consolidating the social specialists."

I had the feeling that making social dependent on process amounted to a missed opportunity for a deeper transformation of our corporations at a time when this transformation is needed. I have a similar kind of feeling today.

I do not know Sprinklr that well, even if, looking at their HR offering from my talent management lens, I am rather impressed. They now need to make the choice of their strategic positioning : does conversation transform corporation or does corporation highjack conversation? There is more fundamental value to be created and to be made from the first option, but it needs a longer view than financial strategy. 

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