This is the talk I'll be giving at the MMC HR Executive Team meeting on October 13, 2009. Topics include an overview of social media trends and its impacts on companies and organizations.

1. Social Media in the
Enterprise
Trends, opportunities, and
lessons learned
MMC HR Executive Team Meeting
October 13, 2009
Presented by Daniel Leslie
Reflexions Data, LLC

2. Overview
The social media lexicon
The long view
Impacts and trends
How are companies benefiting?
McKinsey Global Survey results
Looking ahead
Q&A

3. The social media lexicon

4. The social media lexicon
Emerging web terminology can be confusing and ambiguous.
Lack of consensus by experts & innovators in the field.
Discussion is often mediated by marketers and startups.
Fluid nature of vocabulary reflects the dynamic landscape of
the web itself.

5. The social media lexicon
Some of the more useful terms:
social media
(user-generated content)
conversational media
(text: blogs, microblogs, comments)
social web
(the web of people; social networks)
semantic web
(the web of linked data; one giant
shared database)

6. How did we get here?
The long view 1. Internet
a network of computers
2. World Wide Web
a network of documents
3. Giant Global Graph
a network of people & data
(left: “clock of the long now”)

7. (Video by Erik Qualman: www.socialnomics.net)
Compare to radio, TV, the internet

8. Social media impacts and
trends
Information flow is highly distributed
and decentralized.
Extremely low latency; approaches
real-time.
Increasingly mobile and location-
aware.
Increased information efficiency.

9. Social media impacts and
trends
Social media and web technologies
are almost always layered.
Innovations become stacked on top
of one another.
Web innovation exists within a
positive-feedback loop.

10. Social media impacts and
trends
Both a disruptor and enabler.
Information exchange becomes less
top-down, more bottom-up and
horizontal.
Downward shift of power and
influence and increased transparency.
This is happening to everything from
companies to governments.

11. Social media impacts and
trends
Web 2.0 and social media
applications have largely arisen due to
reduced infrastructure costs and
improved capital efficiency.
“It now takes about 1/10th of the
hardware, software, bandwidth, and
storage costs to build a web service
compared to 1999/2000 time period.”
(http://www.avc.com/)

12. Social media impacts and
trends
Already highly disruptive to some industries:
Traditional print and broadcast media
PR/Communications
Advertising

13. How are companies
benefiting?
New opportunities for cost
reduction and revenue generation
Two categories of cost reduction:
Infrastructure costs
Transaction costs

14. How are companies
benefiting?
What infrastructure costs are
reduced?
Application development
Software licensing
Hardware acquisition & maintenance
Hosting and bandwidth
Real estate

15. How are companies
benefiting?
What transaction costs are reduced?
Recruiting and candidate assessment
80% of companies are using LinkedIn
as their primary tool to find
employees
80% use candidate profiles in their
assessment; 95% use LinkedIn
Source: Jobvite Social Recruitment Survey

16. How are companies
benefiting?
What transaction costs are reduced?
Employee communications: improved
knowledge-sharing and employee
engagement
Interactions with suppliers and
partners
Gaining expertise from outside the
company walls

17. greater benefits. We also looked closely at the factors driving these improvements—for example, the
types of technologies companies are using, management practices that produce benefits, and any
organizational and cultural characteristics that may contribute to the gains. We found that successfu
companies not only tightly integrate Web 2.0 technologies with the work flows of their employees bu
y conducted
June 2009 also create a “networked company,” linking themselves with customers and suppliers through the
McKinsey Global Survey
esponses from
use of Web 2.0 tools. Despite the current recession, respondents overwhelmingly say that they will
dustries,
nal specialties. continue to invest in Web 2.0.
The “Networked Company”
These survey results indicate that a different type of
company may be emerging—one that makes intensive
use of interactive technologies. This networked
organization is characterized both by the internal
integration of Web tools among employees, as well as use
of the technologies to strengthen company ties with
external stakeholders—customers and business partners.

18. Glance:
Exhibit title: A mix of technologies
Exhibit 2
A mix of technologies
Use of technologies, % of respondents Use given tool and report at least
1 measurable benefit from using
Web 2.0 Internal, Customer-related Working with external Web 2.0 technologies
technologies n = 1,032 purposes, n = 870 partners/suppliers, n = 627
Use given tool and report no
Video sharing 48 48 50 measurable benefits from using
24 30 39 Web 2.0 technologies
Blogs 47 51 51
44 42 60
RSS1 42 45 45
32 42 50
Social networking 42 48 49
30 26 48
Wikis 40 37 38
22 31 36
Podcasts 36 37 35
29 24 32
Rating 22 22 24
10 13 22
Tagging 21 23 24
12 13 31
P2P2 20 20 25
5 8 8
Microblogging 18 21 22
13 15 22
Mashups3 14 14 16
3 8 17
Prediction markets 9 9 12
5 4 7
1Really
Although manysyndication.
simple
2Peer to peer. companies use a mix of tools, the survey shows that among all
respondents deriving benefits, the more sources of data into a single tool.
3A mash-up is a web application that combines multiple
heavily used technologies are blogs, wikis, and
podcasts—the same tools that are popular among consumers.
Among respondents who report seeing benefits within their companies, many cite blogs, RSS, and

19. Glance:
Exhibit title: Where the benefits are
Exhibit 3
Where the benefits are Use of technologies
Internal purposes, n = 1,032
Customer-related purposes, n = 870
Working with external partners/
% of respondents within each industry % of respondents within each region suppliers, n = 627
gaining at least 1 measurable benefit from gaining at least 1 measurable benefit
using Web 2.0 technologies1 from using Web 2.0 technologies1
75 64 Latin 55
High tech/telecom 65 India 46 47
48 43 America 36
Business/legal/ 62 North 62 Developing 54
60 54 47
professional services 46 America 36 markets2 41
52 58 53
Manufacturing 37 Europe 45 China 52
24 35 41
51 57
Financial 32 Asia-Pacific 47
20 36
1Includes respondents who are using at least 1 Web 2.0 technology, even if on trial basis.
2Excludes China, India, and Latin America.
Regardless of industry, executives at companies that use more Web 2.0 technologies also report
greater benefits. Comparing respondents’ industries, those at high-technology companies are most
likely to report measurable benefits from Web 2.0 across the board, followed by those at companies
offering business, legal, and professional services (Exhibit 3). Companies with revenues exceeding
$1 billion—along with business-to-business organizations—are more likely to report benefits than
are smaller companies or consumer companies.

20. Glance:
Exhibit title: Integrating for success
Exhibit 5
Integrating for success
Most important practices for successfully using Web 2.0 technologies,
% of respondents reporting at least 1 measurable benefit from using Web 2.0 tools1
Use of technologies
Internal purposes, Customer-related purposes, Working with external partners/
n = 1,032 n = 870 suppliers, n = 627
Integrating use of Web 2.0 Integrating Web 2.0 with Integrating Web 2.0 with
into employees’ day-to-day 75 other modes of customer 74 other modes of partner/ 71
work activities interaction supplier/expert interaction
Senior leaders role Ensuring participation of leading
Marketing Web 2.0
modeling/championing 59 52 partners/suppliers/external 57
initiatives to customers
use of technology experts to gain critical mass
Marketing Web 2.0 initiatives
Providing informal Providing informal
43 35 to partners/suppliers/ 46
incentives incentives
external experts
Providing formal Providing informal
Allowing nonwork uses 17 9 33
incentives incentives
Providing formal
Providing formal incentives 14 10
incentives
1Includes respondents who are using at least 1 Web 2.0 technology, even if on trial basis.
Many companies experiment with Web 2.0 technologies, but creating an environment with a critical
mass of committed users is more difficult. The survey results confirm that successful adoption
requires that the use of these tools be integrated into the flow of users’ work (Exhibit 5).

21. % of respondents, n=1,088
Increasing speed of access to knowledge
Reducing communication costs
Increasing speed of access to internal experts
Decreasing travel costs
Increasing employee satisfaction
Reducing operational costs
Reducing time to market for products/services
Increasing # of innovations for new products/services
Increasing revenue
No measurable effects/benefits
0 17.5 35 52.5 70
Gains from using Web 2.0 for internal purposes
(McKinsey Global Survey Results, June 2009)

22. Where are we going?
“The three current big megatrends in
Looking ahead the web/tech sector are mobile,
social, and real-time. I like to think
of this as the golden triangle. You can
build interesting businesses in each of
these three sectors. [...] But it is what
happens inside the golden triangle that
is really interesting to me.”
Fred Wilson (www.avc.com)
Union Square Ventures
Impact on the enterprise:
productivity applications
location awareness
resource planning

23. Where are we going?
“The Web as I envisaged it, we have
Looking ahead not seen it yet. The future is still so
much bigger than the past.”
Tim Berners-Lee
10-year outlook: transition of
a web of text to a web of
data and knowledge
Impact on the enterprise:
intelligent applications
data mining and analysis
information search will flip:
people and data will find you

24. Questions?