A CONCEPTUAL STAGES OF GROWTH MODEL FOR MANAGING AN ORGANISATION’S SOCIAL MEDIA BUSINESS PROFILE (SMBP) Completed Research Paper

Aidan Duane Waterford Institute of Technology Waterford City, Ireland [email protected]

Philip O’Reilly University College Cork Cork City, Ireland [email protected]

Abstract

Social media can have enormous benefits for organisations, but a failure to manage how these applications are used can have significant and unintended consequences. In this paper, the authors propose a conceptual Stages of Growth (SOG) Model for managing an organisation’s Social Media Business Profile (SMBP). Following extensive reviews of SOG models in the literature, social media practitioner reports and best practice guides, and industry reported cases of SMBP implementations, the authors propose a conceptual growth model consisting of five stages and the paths of evolution between stages. The authors also suggest 10 benchmark variables by which it is proposed the stages and their dominant problems can be measured and managed. The paper concludes with a discussion of its limitations and the field studies currently being undertaken in 40 small to medium enterprises (SMEs) in Ireland to test the SMBP SOG model.

Keywords: Social Media, Stages of Growth, Benchmark Variables, Dominant Problems

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Introduction The concept of social media is of critical importance for organisations today (Kaplan and Haenlein, 2010). According to Kaplan and Haenlein (2010, p.61), Social Media “is a group of Internet-based applications that build on the ideological and technological foundations of Web 2.0, and that allow the creation and exchange of User Generated Content”. Kaplan and Haenlein (2010) identify four key types of social media of significant importance in a business context, namely (i) Collaborative Projects, (ii) (Micro)-Blogs, (iii) Content Communities, and (iv) Social Networking Sites. Social media are used by organisations to develop a Social Media Business Profile (SMBP) for marketing, advertising, public relations, recruitment, research, product and service testing and review, co-creation/ideation, feedback and complaints (Aggarwal et al., 2011; Piskorski, 2011). As SMBP’s evolve and mature, and as their application become more and more mission critical, organisations become increasingly cognisant of the need to develop clear strategies to manage them (Forrester, 2011a; Goffi, 2011). Stages of growth (SOG) models are the most popular approach to developing an understanding of the evolution of information systems (IS), as they describe the maturing use of IS in the organisation (Chan and Swatman, 2004). SOG models are a powerful tool, and extremely important in management research, as they have the potential to create new knowledge and insights into organisational phenomena. However in the context of managing an organisation’s SMBP, only anecdotal information has emerged thus far; mostly in the form of consultant reports and media commentary. Existing IS research has predominantly failed to address this issue and questions such as, how organisations manage the evolving technology, what difficulties and issues arise during the implementation, and what actual strategic benefits are achieved, are often left unanswered. Furthermore, there is little clear evidence of how an organisation’s SMBP evolves, and what distinguishes initial from mature implementations. An analysis of existing social media research reveals a disparate, unstructured, and poorly grounded knowledge pool. Studies are often consumer centric, and the methods and measures adopted to study organisational use of social media are more reflective of personal rather than organisational use. While social media present new challenges for organisations, by proposing a conceptual SOG model in a similar approach to Gibson and Nolan (1974), Galliers and Sutherland (1991), and Damsgaard and Scheepers (1999), the authors adapt and utilise the knowledge of traditional SOG modes to focus, structure, and drive future research of organisational SMBPs as they evolve. From a practitioner perspective, the consequences of failing to manage an organisation’s SMBP are beginning to emerge through social media consultant reports and industry reported cases of SMBP implementations. Stages of growth models represent a picture of evolution, where the current stage can be understood in terms of history and future (Gottschalk and Solli-Saether, 2010, p. 288), thus providing an excellent opportunity to identify the dominant problems encountered by organisations at each stage, so that they may be avoided, or at least strategically managed. Thus, it would seem that this research not only extends the existing stages of growth knowledge, it is also a critical piece of research from a practitioner perspective. This paper continues by conducting an extensive review of over four decades of extant research of stages of growth models in the literature, while also exploring more recent efforts in the literature to develop stages of growth models for social media adoption. Following extensive reviews of social media research, practitioner reports, best practice guides, industry reported cases of SMBP implementations, and reported CEO/CIO media interviews, the authors adopt Gottschalk and SolliSaether’s (2010) model for theorising stages of growth models, to propose a conceptual stages of growth model for the management of an organisation’s Social Media Business Profile (SMBP). The proposed conceptual model consists of 5 distinct stages of growth and 10 benchmark variables, by which it is proposed the stages, and their dominant problems, can be measured and managed.

Traditional Stages of Growth Models for Information Systems Gibson and Nolan (1974) propose a framework for understanding the developing sophistication of IT use and management, and have subsequently presented a number of revised versions. The basic model had four stages but a revised six-stage model was later presented by Nolan (1979). The first three stages, (1) Initiation; (2) Contagion, and; (3) Control, focus on the technology, and the latter stages, (4) Integration; (5) Data Administration, and; (6) Maturity, focus on management of the technology. Nolan (1979) prescribed certain management tasks at each of the stages, and contends that an organisation will move through six distinct stages of maturity with respect to the use and management of information technology.

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Nolan proposes that management principles differ in each growth stage, and different technologies are in different stages at any moment in time. This model emphasised the need for management strategy to be consistent with the organisation’s stage, with respect to that technology (Galliers and Sutherland, 1991). However, Nolan’s (1979) model has been criticised because (a) it has not been possible to validate it’s claim to represent reality; (b) there is a lack of empirical evidence of the actual stages and that the model was overly simplistic for practical purposes (Benbasat, et al. 1984; King and Kraemer, 1984); (c) it is overly focused on database technology in the mainframe era and the symptoms described are in the context of that environment; (d) it fails to provide guidelines for identifying or explaining strategic information systems opportunities which alters the concept of how information technology evolves to maturity within an organisation (Friedman, 1994). Despite these criticisms, the original Gibson and Nolan model (1974) is one of the most cited by information technology researchers, and it is widely recognised as being suitable to provide a basis from which a stages of growth (SOG) model can be proposed. With a certain degree of adaptation, the Gibson and Nolan (1974) SOG model can be applied to emerging information systems (Drury, 1983) as the first four stages are relatively well-accepted (Friedman, 1994). Some adaption is expected as different technologies are in different stages, requiring different management (Galliers and Sutherland, 1991). McFarlan and McKenney (1982) also present a model with four stages of growth, namely, (1) Identification and Initial Investment; (2) Experimentation and Learning; (3) Management Controls, and; (4) Widespread Technology Transfer. Unlike the Gibson and Nolan (1974) model, McFarlan and McKenney (1982) argue that it is not necessary to work through all elements of all stages, and imply that it is possible to select which aspects of the technology management to move forward on. Raho et al. (2003) found empirical evidence to support the validity of McFarlan and McKenney’s (1982) stages of growth model for managing technology assimilation. However, their research does not support the specific stages. Galliers and Sutherland (1991) also consider the model overly focused on technology, and lacking organisational and management focus. Earl (1989) argues that organisations would have different learning curves for different types of IT. Measuring five factors, namely, task, objective, direction/involvement, methodological emphasis, and planning context, Earl (1989) describes the stages through which he believed organisations move during the planning process. However, Galliers and Sutherland (1991) criticise the model suggesting that it only places an organisation at a certain stage in the growth process, without actually suggesting how the organisation might move towards a more mature stage. In response, Galliers and Sutherland (1991) propose a growth model consisting of six stages namely, (1) Ad-Hocery; (2) Starting the Foundation; (3) Centralised Dictatorship; (4) Democratic Dialectic and Cooperation; (5) Entrepreneurial Opportunity and, (6) Integrated Harmonious Relationships. Each stage is measured using Pascale and Athos’ (1981) seven Ss to analyse organisational processes and management, namely, Strategy, Structure, Systems, Staff, Style, Skills, and Super-Ordinate goals. The Galliers and Sutherland (1991) model describes the stages through which organisations evolve with the use of IT, and provides indications as to how organisations should move from an early maturity stage to more advanced maturity stage. However, Brugha (1998) suggests that it is in fact more beneficial to focus on the actual activities rather than the outputs, as they are less tied to a specific context, and activities provide decision makers with indicators of what to do at a particular stage.

e-Business, Intranet, Data Warehousing, and e-Government SOG Models The advent of e-Business heralded the development of several new stages of growth models derived from the traditional stages of growth models. These models assume that organisations pass through increasingly mature stages with respect to the way they use and manage e-Business activities. Most of the models recognise 3-4 distinct stages, with organisations moving from no presence on the Web, through to a static informational presence, and ultimately to fully developed electronic business-to-business (B2B) and business-to consumer (B2C) applications, trading over the Internet and/or using dedicated IOSs (McKay et al., 2000). McKay et al. (2000) propose a model of e-Business implementation, the SOG-e, which integrates Galliers and Sutherlands (1991) stages of growth model to depict activities based on an organisation’s Internet technologies as well as its traditional information systems. The SOG-e consists of six stages namely, (i) no presence (wait and see) (ii) experimental (static) online presence (iii) interactive online presence (iv) Internet commerce (v) integration organisation (internal integration), and (vi) extended enterprise (external integration). The SOG-e presumes a progression of levels through time as the organisation accumulates knowledge, experience, qualifications, and expertise in e-Business. This is not too unlike the model proposed by Earl (2000) which is a descriptive and prescriptive view of the

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stages of growth of e-business. The six stages include (i) External Communications, (ii) Internal Communications, (iii) e-Commerce, (iv) e-Business, (v) e-Enterprise, and (vi) Transformation. By contrast, Rayport and Jaworski (2002) suggest a four-stage model of the evolution of B2B e-Commerce as organisations utilise the Internet for business-to-business activities. However, the model is now considered flawed, as it proposes that e-Business using the Internet should be managed separately from all other information technology initiatives in the organisation (Ghachem, 2006). Rao et al. (2003) also propose a stages of growth model for e-Commerce implementation comprised of four phases: (1) presence; (2) portal; (3) transaction integration, and; (4) total integration. Rao et al. (2003) maintain that it is beneficial to have a multi-stage maturity model that describes a logical evolution of e-Commerce, and guides organisations to develop towards more advanced maturity stages. Rao et al. (2003) suggest that the costs, the technology required, and the complexity, increase progressively during the last phases of the model. Interestingly, the model proposed by Rao et al. (2003) does not require organisations to progressively accomplish each stage successfully; organisations can begin in any phase, skipping certain stages; and, an organisation that is increasingly aware of information technologies and e-Commerce could begin with a later maturity phase, in order to accelerate its implementation process. Chan and Swatman (2004) propose a stages of growth model for B2B e-Commerce implementation based on four stages identified as (i) initial e-Commerce; (ii) centralised e-Commerce; (iii) looking inward for benefits; and (iv) global e-Commerce. Consistent with traditional stages of growth models, Chan and Swatman (2004) found that e-Commerce implementation also evolved from a simple initiative and proceeded to an increasingly complex implementation. The organisations’ no longer implemented E-Commerce merely for cutting costs (transactional) and competitive advantage (strategic), but in an increasingly complex implementation to enable better integration and control over information (informational). Chan and Swatman (2004) found that two growth types, namely, the strategy and objectives, and the focus of the implementation, were consistent when examined empirically across several cases. Interestingly, Chan and Swatman found that the type(s) of technologies being used by each organisation studied were not of great importance, and that the structure and level of management were inconsistent across organisations.

Stages of growth models have also been adopted by Hinrichs (1997), KPMG (1997), Damsgaard and Scheepers (1999), and Duane and Finnegan (2003), to explore the evolution of Intranets in organisations. In a departure from the traditional stages of growth models, Hinrichs (1997) depicts the evolution of an Intranet as consisting of five growth stages, namely: Basic; Publishing; Collaboration; Transactions; and, Inter-Enterprise Networking via an Extranet. Each growth stage is measured using six key indicators namely: description; architecture; people and processes; value added; cost drivers; and, limitations. KPMG (1997) proposed a growth model comprised of five stages entitled: Ad-hoc; Advanced; Integrated; Highly Interactive; and, Extended Enterprise, and suggest there is a maturity curve to the introduction of any enabling technology, and technologies evolve through several levels, with each level marking a possible staging point. In a return to the original stages of growth models, Damsgaard and Scheepers (1999) propose a SOG model for Intranets based on four stages, Initiation, Contagion, Control and Integration, and analyse the model using the “Seven Ss”. Similar to McFarlan and McKenney (1982), Damsgaard and Scheepers (1999) suggest that progression can be made even though not all elements are strictly in the same phase, and stages can be skipped. Duane and Finnegan (2003) also use a SOG model to identify six growth stages of Intranets characterised by a description of the stage, technologies adopted, and utilisation at each stage. According to this model, Intranets develop organically in early stages, evolve rapidly to become critical for day-to-day operations, extend to integrate the external value chain, and similar to the Galliers and Sutherland (1991) SOG model, become institutionalised in the organisation.

Stages of growth models are also evident in studies of data warehousing and e-Government. Watson et al. (2001) develop a data warehousing SOG model based on Nolan (1974), and use nine benchmark variables to describe the different stages. Janssen and van Veenstra (2005) propose a SOG model for the development of information architectures for governmental agencies consisting of five stages. Janssen and van Veenstra suggest that organisations sometimes concatenate stages, and the number of stages may expand as technological advances are made, or discontinuities occur. This perspective is similar to Watson et al. (2001), who reveal that developments in data warehousing changed their proposed SOG model. De Brì (2009) proposes a SOG model for e-Government which recommends adoption of a stage provided

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there is consensus there is value in moving forward. The model suggests some stages may be skipped but phases may not be skipped over. The model aids in describing and gaining consensus on the organisation’s current level of maturity and complexity with regard to e-Government, while assisting senior management in formulating a strategy to pursue their e-Government objectives (de Brì, 2009).

Social Media Stages of Growth Models One recurring feature in the literature of the evolution of an organisation’s Social Media Business Profile (SMBP) is rapid growth. Many organisations have difficulty in adapting to this pace (Kaplan and Haenlein, 2010), and struggle to manage negativity such as complaints (Ward and Ostrom, 2006), directed at the organisation via its SMBP (Kaplan and Haenlein, 2010). In addition, inappropriate and illconsidered postings to the SMBP can have unimaginable and unintended consequences for the organisation’s public persona, and ultimately their bottom line (Hamnett, 2011). Many organisations also fail to recognise that the ultimate control and ownership of its SMBP, and the content posted, does not rest with the organisation, but rather with those who created the social media platform (Kaplan and Haenlein, 2010). Taking all of this into consideration, one must question if organisations have developed clear strategies to manage the SMBP as it evolves, and as its application becomes more mission critical (Forrester, 2011a; Goffi, 2011). Recent studies have attempted to progress the SOG literature with by developing a stage model for business use of Social Media. Jacobs and Nakata (2010) propose a conceptual six stage model for the adoption of Social Media by organisations based on the Earl (2000) SOG model. Although the Jacobs and Nakata (2010) model includes a description of the relative organisational focus at each stage, it is a rather simplistic, non-specific approach to modelling. The model does not identify any mechanism by which progress can be driven or measured from stage to stage, nor does it identify any management challenges or problems to be overcome at any of the stages in the same way that Rao et al. (2003) identified “Barriers” and “Facilitators” at each stage of their proposed SOG Model, and in the same way that Gottschalk and Solli-Saether (2010) propose that all SOG models should identify “benchmark variables” and “dominant problems” at each stage. The Jacobs and Nakata (2010) model is also conceptualised based on one single SOG model, namely Earl’s SOG Model (2000), and does not consider the contributions to this field by any other SOG models. Recently, Forrester (2012) proposed a SOG model consisting of five stages: (i) Dormant, (ii) Testing, (iii) Coordinating, (iv) Scaling and Optimising, and (v) Empowering. According to Forrester (2012), organisations must make fundamental changes to resources, skills, tools, processes, and culture in order to succeed in social media. Forrester (2012, p. 2) contend that maturity with respect to business adoption of social media isn’t confined to developing a “thriving advocacy program or social-sign on website”; it requires a deeper more “fundamental shift” in an organisations strategy, processes and culture. However, while Forrester’s SOG model is interesting, it is confusing, particularly with respect to the “Dormant Stage”, which in essence is not a stage at all, as no social media activities occur. The “Empowering” stage is also poorly developed which may reflect how few organisations are at this stage. The benchmark variables (i.e. Defining Characteristics, (ii) Experience, (iii) Resources, (iv) Processes, (v) Measurement, (vi) Commitment, and (vii) Culture, are also ambiguous, especially “Culture”, and appear to merge variables traditionally recognised as being distinctly different. Thus, the evidence presented underlines the need for a well developed conceptual SOG model for the management of an organisation’s SMBP that can be empirically tested. This proposed model can be used descriptively to assess the maturity and sophistication of an organisation’s current SMBP, and prescriptively, in formulating an appropriate strategy to pursue objectives, in order to avoid difficulties with the SMBP before they arise. Gottschalk and Solli-Saether (2010, p.280-282) propose four key topics in theorising a SOG model, which are utilised in Table 1 to extract the key characteristics of SOG models evident in the literature, before proposing a conceptual SOG model for managing an organisation’s Social Media Business Profile (SMBP) in Section 3 of this paper.

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Table 1: Applying Gottschalk and Solli-Saether’s (2010) Four Key Topics in Theorising Stages of Growth Models, to Characteristics Emerging from SOG Literature Topics

Characteristics

Number of Stages

1.

Stages of Growth (SOG) Models consist of 3 to 6 stages.

Paths of Evolution

1.

Some natural development is to be expected, and different technologies are in different stages, and therefore require different management.

Benchmark Variables

Dominant Problems

2.

Organisations pass through increasingly mature stages with respect to the way they accumulates knowledge, experience, qualifications, expertise, and how they use and manage e-Business activities.

3.

Organisations do not need to progressively accomplish each stage successfully; organisations can begin in any phase, skipping certain stages; an organisation that is increasingly aware of information technologies and e-Commerce, could begin with a later maturity phase.

4.

Organisations sometimes concatenate two stages into one stage, and the number of stages in their growth model may expand as technological advances are made, or discontinuities may occur and a new stage of growth model may be required.

References Gibson & Nolan (1974); McFarlan & McKenney (1982); King & Kraemer, (1984); Raho et al. (1987); Earl (1989); Galliers & Sutherland (1991); Friedman (1994); Hinrichs (1997);KPMG (1997); Damsgaard & Scheepers (1999); Earl (2000); McKay et al. (2000); Watson et al. (2001); Duane & Finnegan (2003); Chan & Swatman (2004); de Bruin & Rosemann (2005); Janssen & van Veenstra (2005); De Brì (2009); Jacobs & Nakata (2010); Lingling (2011); Rocha (2011); Forrester (2012). 1.

Gibson and Nolan (1974)

2.

McKay et al. (2000)

3.

McFarlan & McKenney (1982); Damsgaard & Scheepers (1999); Earl (2000); Rao et al. (2003)

4.

Watson et al. (2001); Janssen & van Veenstra (2005); Forrester (2012)

5.

KPMG (1997); Forrester (2012)

6.

Gibson & Nolan (1974); Rogers (1995); KPMG (1997); Damsgaard & Scheepers (1999); Watson et al. (2001); Forrester (2012)

Each growth stage can be measured using:

1.

Galliers & Sutherland (1991); Damsgaard & Scheepers (1999)

1.

The 7 Ss: Strategy; Structure; Systems; Staff; Style; Skills; Super-Ordinate goals.

2.

Earl (1989)

2.

Five factors: task; objective; direction/involvement; methodological emphasis; planning context.

3.

Hinrichs (1997)

3.

Six key indicators: description; architecture; people and processes; value added; cost drivers; limitations.

4.

Duane & Finnegan (2003)

5.

Watson et al. (2001)

6.

Chan & Swatman (2004)

7.

Forrester (2012)

5.

There is a maturity curve to the introduction of any enabling technology, and technologies evolve through several levels, with each level marking a possible staging point.

6.

The S shaped curve can be divided into a number of distinct stages, and used to model IT penetration in a stages of growth model.

4.

The types of technologies adopted and how they are utilised at each stage.

5.

Nine benchmark variables: data; architecture; stability of production environment; warehouse staff; users of warehouse; impact on users’ skills and jobs; use of warehouse ; organisational impacts; costs and benefits.

6.

Five growth types: the strategy and objectives of the initiative; the structure of the E-Commerce implementation; the types of E-Commerce technologies and applications used; the focus of the implementation; the level of management involved in the implementation.

7.

Six critical success factors: experience; resources; process; measurement; commitment; culture.

1.

The costs, the technology, and complexity, increase progressively during the last phases of the model.

1.

Rao et al. (2003)

2.

The structure and level of management can be inconsistent across organisations.

2.

Chan & Swatman (2004)

3.

The types of technologies adopted by each organisation may not be of great importance.

3.

Chan & Swatman (2004)

4.

Organisations may be unable to adapt to the pace of rapid growth.

4.

Kaplan & Haenlein (2010)

5.

Organisations may fail to manage negativity and critical comments.

5.

Ward & Ostrom (2006); Kaplan & Haenlein (2010)

6.

Organisations may fail to adequately control the system.

6.

Damsgaard & Scheepers (1999); Duane & Finnegan (2003); Kaplan & Haenlein (2010)

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Proposed Conceptual Stages of Growth Model for Managing an Organisation’s Social Media Business Profile (SMBP) Gottschalk and Solli-Saether (2010, p. 283) developed a modeling process for stage models. The model can be used to analyse where a stages of growth model is, in the context of its development, representing a theoretical and an empirical research procedure “where the object changes its status from a suggested stage model, via a conceptual and theoretical stage model, to an empirical stage model, and finally to a revised stage model” (Figure 1). In the context of this paper, the proposed stages of growth model for managing an organisation’s SMBP is at the “Conceptual Stage Model”.

Figure 1. Procedure for the Stages of Growth Modeling Process (Gottschalk and Solli-Saether, 2010, p. 283)

Most stages of growth models pre-define maturity for the information system, and establish progressive stages to plot a path toward that objective. While the names of theses stages and the key variables by which they are measured are different, it is clear that information systems evolve through a number of stages with respect to their use and management, and increase in sophistication and complexity, as their application becomes more significant and mission critical (Duane and Finnegan, 2003; Gottschalk and Solli-Saether, 2010). Gottschalk and Solli-Saether (2010, p. 280-282) propose four key topics in theorising a stages of growth model, which the authors of this paper utilise to propose a stages of growth model for the management of a SMBP. The four key topics are: 1. Number of Stages: Organisational phenomena undergo transformations in their design characteristics that can be defined in terms of discrete stages of growth. 2. Paths of Evolution: An organisational phenomenon shows a predictable pattern of development from stage to stage, until it reaches the final stage, either directly or via bypassed or revisited stages. 3. Benchmark Variables: Values of benchmark variables for each stage of growth will statistically correspond with the conceptual formulations given for that stage. 4. Dominant Problems: Dominant problems at each stage of growth will statistically correspond with the conceptual formulations given for that stage.

Number of Stages and Paths of Evolution While social media adoption can start anywhere in an organisation, companies across different industries and regions will experience common stages of evolution as they implement, manage, and optimise these technologies (Forrester, 2012). With a certain degree of adaptation, the Gibson and Nolan (1974) stages of growth model can be applied to emerging IS (Galliers and Sutherland, 1991; Damsgaard and Scheepers, 1999; Watson et al., 2001). The first four stages of the Gibson and Nolan (1974) model are relatively wellaccepted, and when combined with additional SOG models by Galliers and Sutherland (1991), Damsgaard and Scheepers (1999), and Watson et al. (2001), they provide a well-established and conceptually stable

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starting point from which to propose a conceptual stages of growth model for managing an organisation’s Social Media Business Profile (SMBP). According to de Bruin and Rosemann (2005), the most popular way of evaluating IS maturity is with a five-point scale where Stage 5 represents the highest level of maturity. In a similar approach to Gibson and Nolan (1974), Galliers and Sutherland (1991), Damsgaard and Scheepers (1999), Earl (2000), McKay (2000), Duane and Finnegan (2003), Jacobs and Nakata (2010) and Forrester (2012), the authors propose that an organisation’s SMBP evolves through five distinct stages, namely: (i) Experimentation and Learning; (ii) Rapid Growth; (iii) Formalisation; (iv) Consolidation and Integration; and, (v) Institutional Absorption. The authors also propose that as the SMBP evolves, it increases in complexity and sophistication, and integrates with the business strategy, before becoming embedded in the organisation’s IS architecture and business strategy and practices. Stage 1: Experimentation and Learning In this stage, it is proposed that an organisation’s SMBP may grow organically without any plan, beginning as a pilot to test the capabilities of the applications and also to understand the skills required. According to respondents of a McKinsey (2007) survey of 2,847 global executives, social media adoption in most organisations is a grassroots effort, which is often just as effective as a formal pilot programme. Similar to McFarlan and McKenney’s (1982) SOG model, experimentation and learning reflect the key activities at the first stage. According to Forrester (2012, p.5) these testing activities are typically bottomup, “occurring in isolated pockets with minimal guidance and commitment from management”. Employees engage in experimental social media activities, learning the basic skills to use the applications and the underlying rules governing participation in social media networks. Typical activities at this stage involve creating a basic SMBP on one or two social media applications, announcing the organisation’s arrival in the social media space, posting a number of comments, images and videos, and providing some information (McKinsey, 2007; Forrester, 2012). At this point, management is often unaware of the SMBP as it may be departmental driven, or the work of a single individual. Few people in the organisation may fully understand the concept. Externally, few people are aware of the organisations SMBP. The path of evolution from this stage requires champions or HEROes (Highly Empowered and Resourceful Operatives) (Forrester, 2012, p.7) working in isolated pockets to drive the use of social media as a business information system. These champions bring the SMBP to the attention of management, and to explain to management, its benefits or necessity. This is often the catalyst for a more in-depth look by management at what competitors are doing in the social media domain, and to establish whether the organisation is a laggard or early-adopter. Management may also seek an understanding of the different types of social media applications available, in order to identify which applications will be adopted. This stage is largely driven by information seeking, education, and experimentation with the different social media applications. However, management may also close the SMBP if they feel it is inappropriate. Stage 2: Rapid Growth Executive respondents to McKinsey’s (2007) survey, contend that grassroots efforts (Stage 1– Experimentation and Learning) of social media adoption rapidly demonstrate their value. This stage involves the expansion of the grassroots or pilot implementation to additional areas of the organisation and it is driven by bottom-up widespread user participation coupled with top-down management support and encouragement. Similar to the nature of e-Commerce implementation described by Chan and Swatman (2004), the implementation of the SMBP at this stage may take a consumer-centric focus. Thus, efforts to increase internal and external awareness of the SMBP accelerate, and existing customers are encouraged to connect, and to follow, like, recommend, and comment, on the organisation’s SMBP. McKinsey’s (2007) contend early social media adoptions are customer focused, and its use at this stage is driven more by teams tied to the customer relationship. McKinsey’s (2007) also contend that at these early stages, the role of senior management should be to provide the support, supply the permission and resources, and to set the boundaries, enabling intelligent and motivated teams to develop the SMBP. Employees are focused on finding a way to use social media for task-driven processes and implementing the early processes to manage them (Forrester, 2012). The implementation may expand to include other social media as management become more confident with having a SMBP. According to Forrester (2012, p.8) the organisation may also begin to collect “simple volume metrics like the quantity of followers, likes, comments, and visits”. Thus, it is proposed that rapid growth describes the second stage, as use of social

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media proliferates, and management begin to support and encourage the development of the organisation’s SMBP. The path of evolution from this stage stems from recognition that there is a lack of planning and a clear strategy for the SMBP. Executive respondents to McKinsey’s (2007) survey, suggest the grassroots approach to social media adoption reflects the novelty and availability of the technology, but that as adoption of the technology grows the process tends to be formalised. Feedback from external stakeholders, especially customers, underlines inconsistencies in the organisation’s approach to implementing a SMBP (Piskorski, 2011). Management may also find that there is a disconnection between the organisation’s business goals and objectives, and the SMBP. Some teams that have built successful social applications now need to develop more sophisticated processes for managing them. Management may also recognise a need to organise cross-collaboration among teams, install team-leaders and an overall social media project manager, implement training programmes, and establish mechanisms to correlate social media data with existing business metrics (Forrester, 2012). Stage 3: Formalisation McKinsey’s (2007) suggest that once grassroots projects (Stage 1 - Experimentation and Learning) have rapidly demonstrated their value (Stage 2 - Rapid Growth), these projects are then “taken up by their natural owners within the organisation” (Stage 3– Formalisation) who then continue to invest and develop the project. Forrester (2012, p.5) suggest that at this “coordinating stage” management recognise both the “risks and rewards of social technologies”, and as a result coordinate business teams for “program execution, long-term planning, knowledge sharing, and governance”. Thus, it is proposed that in Stage 3, management recognise a need for proper planning, strategy and governance. As a result, a more centralised approach, rather than a decentralised approach, is used for better control and management of the implementation, and a SMBP Strategy is formalised to link social media activities to the business goals and objectives. According to Forrester (2012) organisations typically go through a similar process: they start using social media in a decentralised manner as it springs up organically, and then they turn to a more centralised model to coordinate efforts as the SMBP evolves. At this stage, the formation of a SMBP Steering Group is essential in order to develop a SMBP Policy and a SMBP Strategy. According to Forrester (2012) over 31% of large organisations have social media “Governance Councils” in place. The SMBP Steering Group should develop a SMBP Policy to guide employees on how to conduct themselves when using social media to protect against security breaches, legal vulnerabilities, legal obligations, and standards of conduct (Forrester, 2012). The SMBP Steering Group must also develop metrics and implement customised reporting for the different stakeholders (Forrester, 2012). The business-wide scope of the project at this stage necessitates that management has sufficient resources to develop the SMBP, and should thus be able to obtain assistance from external social media experts. IBM built a dedicated Social Media Department to identify the latest trends and share best practices across the organisation. At this stage, organisations should also begin to implement training programmes, such as those implemented by Australian telecommunications company Telstra, who require all employees to undertake an online social media module, or if they are high-frequency business users of social media technologies, they must attend an in-depth one day training session (Forrester, 2012). The path of evolution from this stage arises through the organisations need to look for opportunities to integrate their SMBP with existing systems and business processes. The SMBP Steering Group must “create a long-term plan that incorporates both a vision and a detailed road map for how to meet it” (Forrester, 2012, p.10). Once management has stabilised its implementation of the SMBP by formalising a planned, strategic, and consistent approach, management can look for opportunities to further integrate social media applications with existing systems. This stage may also require a cost/benefit analysis of the organisation’s social media offerings, resulting in closure of one or more social media applications, to divert more resources toward applications considered better positioned to drive the SMBP strategy. Stage 4: Consolidation and Integration As technologies, applications, and stakeholders needs evolve, management focus on consolidating, integrating, and even partnering with other organisations, in an effort to provide customers with a more integrative social media experience (Forrester, 2011b). According to Forrester (2012, p.11), management at this stage is focused on “optimising their processes and creating scale with their applications” and using social media to “drive fundamental business change” including involving customers in product and

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E-Business and Competitive Strategy

service development and innovation. Social media have emerged as a critical tool for consumer product strategy (CPS) professionals and co-creation gives CPS professionals “the ability to embrace consumers and leverage their insight to improve existing products or create new ones” (Forrester, 2012, p. 14). McKinsey (2007) contend social media adoption growth is driven by inspiration and passion from key stakeholders, and this inspiration often comes from outside the company, or even the industry. Social cocreation/ideation has been adopted by firms such as Dell, Threadless, Starbucks, Adidas, BBC, BMW, Ducati, Muji, and Sears (Huang et al., 2011). Organisations should also look to use social media to work with suppliers and to locate internal expertise, as “incorporating greater input of people closest to supply and demand, companies can expect lower rates of product failure, faster ideation, and ultimately more successful products and services” (Forrester, 2012, p.2). Management must move beyond “collecting followers to a more sophisticated use of social data for intelligence and optimization” by incorporating “Social Intelligence, the concept of turning social media data into actionable business strategy, to get the most from the social media data they collect, in order to develop a broader strategy internally, integrate social data with their existing customer data, and share the data across the organisation to ensure that all teams benefit from the insights” (Forrester, 2012, p.11 and 15). Thus, it is proposed this stage may involve what Duane and Finnegan (2003) refer to as internal process and systems integration, and external value chain integration. Similar to e-Commerce implementation described by Chan and Swatman (2004), the SMBP at this stage may take a supplier-centric focus, and continue to further expand by integrating the external value chain, whereby existing business process are re-engineered, and new processes are created to enable a new way of doing business. CRM, product\service testing, and customer driven new product/service conceptualisation, may become part of the SMBP strategy. The path of evolution at this stage can take a number of avenues. Firstly, management may simply consolidate the existing stages by reviewing social media offerings and how the organisation controls and manages its use of social media to ensure it is meeting the objectives established in the SMBP Strategy. Secondly, management may decide to integrate social media with internal systems and business processes. Thirdly, as new social media emerge, management may decide to further integrate the SMBP with the external value chain, which may require BPR, or the generation of new ways of doing business. This may require a further revision of the SMBP strategy, focusing on the possibilities of establishing competitive advantage. Stage 5: Institutional Absorption As management become more experienced with the SMBP, and the underlying technologies mature, usage patterns shift, and social media become the de-facto applications of choice for performing certain key business tasks. At this stage, employee integration reaches a point of scale as the organisation has implemented enterprise-wide social media, empowering the entire workforce (Forrester, 2012). The use of social media affects a systematic approach to improving business processes, which has become a key priority in the organisation (Forrester, 2012). Thus, it is proposed at this stage, the SMBP is considered to be what Damsgaard and Scheepers (1999) and Duane and Finnegan (2003) refer to as, institutionally absorbed. Similar to e-Commerce implementation as described by Chan and Swatman (2004), the SMBP at this stage may have a multi-directional focus aimed at customers, suppliers and industry partners, as its business connectivity is transformed to establish wider global business relationships. Organisations with a more mature SMBP, use it in a more highly integrated and interactive manner, and expand their implementation to a broader industry group than originally defined. At this stage, management no longer focus on exploring applications, and instead focus on established applications (Forrester, 2011a). This is not to say that new social media are not evaluated, it simply means that the organisation has established a SMBP Strategy, consisting of a core of social media deemed critical for operations. At this stage, lessons have been learned and management does not allow hype about new social media cloud their judgment. Management has a broader perspective, retaining that which is good in existing social media and embracing new applications as appropriate. Forrester (2012) suggest organisations may even decentralize by empowering their employees to use social media to solve problems and make better decisions.

Benchmark Variables As illustrated previously in Table 1, an analysis of the existing stages of growth models in the literature identified numerous benchmark variables for measuring each growth stage. However, many of these measures were developed without taking into account the specific characteristics of Web 2.0. Thus, a

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Duane & O’Reilly / An SOG Model for Managing an Organisation’s SMBP

certain degree of adaptation is required for Web 2.0. Furthermore, a Social Media Business Profile (SMBP) invokes its own contextual managerial challenges, thus new benchmark variables may also be warranted. In consideration of this, the researchers conducted further analysis of extant social media literature, expert social media practitioner reports, best practice guides, industry reported case studies of SMBP implementations, and reported industry interviews eliciting the social media experiences of numerous organisational CEO’s and CIO’s. Thus, the author’s extensive analysis of traditional SOG benchmark variables and more recent Web 2.0 and social media literature and documented case evidence, reveals 10 possible SMBP benchmark variables, which may be used to empirically measure the growth of an organisation’s SMBP. Table 2 provides a cross-comparison of the proposed Social Media Business Profile (SMBP) benchmark variables with the traditional stages of growth measures arising in the literature. The proposed SMBP benchmark variables are: 1.

Strategy: As an organisation’s SMBP evolves, additional applications are added and it is imperative that all social media are aligned and consistent with strategic goals and audience needs, and that there is no ambiguity or uncertainty across different channels. Thus, an organisation’s business strategy needs revision to integrate the SMBP. To achieve a fully mature SMBP, “management must commit by creating a companywide vision and developing a long-term plan for empowering employees and customers” and “set social priorities relative to other strategic programs” (Forrester, 2012, p.4).

2. Business Processes: As an organisation embraces social media internally, driving the re-engineering of internal business processes, staff connectivity, collaboration, engagement, interactivity, communications and how they work, are changed (Piskorski, 2011). McKinsey (2011a) contend that management should think strategically about how social media can support business processes enabling organisations to navigate the external environment, forging stronger links with customers and suppliers, and integrating these technologies into the workflow to optimise internal processes. A social media solution involves aiming the right tools at a defined business process (Gartner 2010a). 3. Structure: An ideal structure for social media has yet to emerge as it involves an organisation’s industry, structure, philosophy, and resources. IBM and Dell have had success with a centralised hub and-spoke approach, while organisations like Newell Rubbermaid have taken a decentralised approach diffusing social activities to the different brands and teams (Forrester, 2012). However, there is sufficient evidence to indicate that as an organisation’s SMBP evolves and as employees’ skills and responsibilities change, so does the structure of the social media implementation. According to Forrester (2012) organisations typically go through a similar process: they start using social media in a decentralised manner as social technologies spring up organically, and then turn to a more centralised model to coordinate efforts as the SMBP evolves, and finally they decentralize by empowering relevant employees to use social tools to do their jobs. The notion of empowering only “relevant” employees is also shared by Virtusa, who do not include all employees in its social media strategy, first establishing what benefit their involvement has for the organisation (Gartner, 2010b). 4. Management Style: Management styles that empower employees so that creativity emerges, and enable business wide conversations by creating opportunities for discussion and collaboration, are critical success factors for the growth of an organisation’s SMBP (Gartner, 2010a). In addition employee training, Virtusa’s SVP of Marketing met with line of business managers to enable them understand the value of social media and to allay their fears about employees' use (Gartner, 2010b). Inspired senior leadership can propel the SMBP forward and can ultimately lead to a transformation of the organisation’s culture. However, a socially empowered culture is both top-down and bottomup; employees must buy into the benefits of using social media to perform their work (Forrester, 2012). Thus, Robert Stroud, CGEIT, international VP of ISACA (2010) believes that companies “need to empower employees with knowledge to implement good social media governance”. 5.

Technologies Adopted: As the SMBP evolves additional applications are added (Kaplan and Haenlein, 2010). New social media emerge on a regular basis (Kaplan and Haenlein, 2010) and established social media evolve quickly and their offerings become increasingly pervasive (Forrester, 2011b). Kaplan and Haenlein (2010, p.65) suggest organisations do not participate in all forms of social media as “being active is one key requirement of success”. Organisations should choose an appropriate social media for the specific purpose at hand depending on the message to be communicated, as each social media application “usually attracts a certain group of people and companies should be active wherever their customers are present” (Kaplan and Haenlein, 2010, p65.)

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Table 2: A Cross-Comparison of the Proposed Social Media Business Profile (SMBP) Benchmark Variables with the Traditional Stages of Growth Measures Arising in the Literature Benchmark Variables 1. Strategy

Key Attributes of SMBP Benchmark Variables

References

References

1. Redefine strategy

1. McKinsey (2007)

1. Strategy

1. Galliers & Sutherland (1991)

2. Strategy: passive or active

2. Bott et al. (2009)

2. Strategy

3. Revised, realigned, unambiguous channel strategy

3. Gartner (2010a); Kaplan & Haenlein (2010)

2. Damsgaard & Scheepers (1999)

4. Strategy

3. Chan & Swatman (2004)

5. Objective

4. Duane & Finnegan (2003)

4. Social strategies enable greater returns 5. Strategic goals and company-wide vision

4. Piskorski (2011) 5. Forrester (2012)

2. Business Processes

Related Traditional SOG Measures

1. Different social media technologies for specific business processes 2. BPR and new business processes

3. Strategy

6. E-Channel Strategy

5. Earl (1989) 6. Earl (2000)

1. Gartner (2010a); McKinsey (2011a)

1. Organisational Impacts

2. McKinsey (2011a)

2. Direction/ Involvement

1. Watson et al. (2001) 2. Earl (1989)

3. Social media drives BPR changing how people work, and social needs solutions connected to processes, generate success

3. Piskorski (2011)

4. BPM and streamlined workflow

4. Forrester (2012)

1. Centralised to empowering structures

1. Gartner (2010b)

1. Structure

1. Galliers & Sutherland (1991)

2. Centralised hub and spoke or decentralised by brand or teams

2. Forrester (2012)

2. Structure

3. Organic, decentralised, centralised, and empowering structures

3. Forrester (2012)

3. Structure

2. Damsgaard & Scheepers (1999)

1. Top-down and bottom-up social empowerment

1. Forrester (2012)

1. Style

1. Galliers & Sutherland (1991)

2. Empowerment

2. Gartner (2010a)

2. Style 3. Management Involvement

2. Damsgaard & Scheepers (1999)

3. People & Processes

3. Hinrichs (1997) 4. Earl (2000)

4. BPR 3. Structure

3. Chan & Swatman (2004) 4. Management Style

5. Technologies Adopted

3. Inspired senior leadership

3. Forrester (2010c)

4. Empowered employees

4. ISACA (2010)

5. Formalised policies, procedures, governance

5. Forrester (2012); Bott et al (2010); Gartner (2010b)

1. Key social media types: collaborative projects, blogs, content communities, social networking sites, virtual game worlds, and virtual social worlds

1. Kaplan & Haenlein (2010)

2. New social media emerge and are tested/adopted on a regular basis 3. Adopt applications where customers are present 4. Established social media platforms quickly evolve

2. Kaplan & Haenlein (2010); Forrester (2011b)

1. Technologies Used

1. Chan & Swatman (2004)

2. Types of Technologies Adopted and Utilisation

2. Duane & Finnegan (2003)

3. Kaplan & Haenlein (2010) 4. Forrester (2011b)

5. Most used: social networking, blogs, video sharing, and microblogging

5. McKinsey (2011a)

6. Stand alone and bundled technologies

6. Bott et al. (2009)

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Duane & O’Reilly / An SOG Model for Managing an Organisation’s SMBP

6. Application of Technologies

1. Departmental and institutionally driven applications

1. Forrester (2011a)

1. Applications

1. Gibson & Nolan (1974)

2. Social media technologies support a wide range of business processes

2. McKinsey (2011a)

2. Applications

2. Galliers & Sutherland (1991)

3. Systems- Use Mode

3. Damsgaard & Scheepers (1999)

4. Applications

4. Duane & Finnegan (2003) 7. Impact on Skills

1. Internal/external stakeholders learn new skills/ take on new responsibilities

1. Forrester (2012)

1. Skills

1. Galliers & Sutherland (1991)

2. Piskorski (2011)

2. Skills

2. Recruitment of specialised social media skilled personnel

3. Forrester (2012)

3. External assistance from marketing agencies/social media consultants

4. Bott et al. (2009)

3. Impact on Users Skills and Jobs

2. Damsgaard & Scheepers (1999)

4. Premium paid to social media skilled workers

3. Watson et al. (2001)

5. Gartner (2010b)

5. Thorough training programmes require long-term commitment 8. Impact on Internal Stakeholders

1. Increases staff connectivity, collaboration, interactivity, and communications 2. Community tools/internal blogging simplify staff connectivity & info. sharing 3. Increased collaboration 4. Identifies internal expertise

1. Piskorski (2011)

1. Staff

1. Galliers & Sutherland (1991)

2. Forrester (2012)

2. Staff

3. Forrester (2010c)

3. Warehouse Staff

2. Damsgaard & Scheepers (1999)

4. Forrester (2012)

4. Users of Warehouse

4. Watson et al. (2001)

5. Personnel Involved

5. Chan and Swatman (2004)

5. McKinsey (2011a)

3. Watson et al. (2001)

5. Future use of social media will blur boundaries between all stakeholders, enable teams to self-organise, & facilitate data driven decision making 9. Impact on External Stakeholders

1. Increases connectivity, participation and collaboration 2. Increases customers access to brands, efficiency of advertising spend & CLV; creates customer advocates; engenders loyalty; leverages earned media. 3. Enables positive and productive engagement with customers, prospects, and detractors, facilitating better management of online reputation 4. Instant customer feedback, positive and negative 5. Continuous knowledge modification by “users” in collaboration.

1. Kaplan & Haenlein (2011); Piskorski (2011)

1. Super-Ordinate Goals

2. Kaplan & Haenlein (2011); Forrester (2012)

2. Super-Ordinate Goals

3. McKinsey (2011a) 4. McKinsey (2007) 5. Kaplan & Haenlein (2011)

6. Customer engagement in co-creation

6. Forrester (2012)

7. Emergence of rich dialogue with “customer experts” in cocreation/ideation

7. McKinsey (2007)

8. Crowdsourcing enables advanced co-creation with knowledgeable contributors, increasing potential for “blockbuster” ideas 9. Increased integration/communication with partners/suppliers

3. Implementation Focus

8. Huang et al. (2011) 9. McKinsey (2011c) 10. Forrester (2012)

10. Increased collaboration with partners/suppliers, customer/partner engagement, leading to co-creation of new products/services, and lower rates of product failure, faster ideation, and more successful products/services

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1. Galliers & Sutherland (1991) 2. Damsgaard & Scheepers (1999) 3. Chan & Swatman (2004)

E-Business and Competitive Strategy

10. Return on Investment

1. Increased integration and consolidation of applications increases costs 2. Align objectives, metrics, targets and strategies across four perspectives - the financial, digital, brand, and risk management perspectives 3. Existing models of ROI are of limited value, destructive, & restrict innovation 4. Social media reduced customer “churn rate” and increase CLV 5. Social media improves collaboration and strengthens external connections among suppliers, partners, customers, thus increasing value 6. Senior mgt. may consider social media a cost rather than addedvalue

1. Gartner (2010a); Forrester (2011a); Piskorski (2011) 2. Forrester (2012) 3. McKinsey (2007) 4. McKinsey (2007) 5. McKinsey (2007) 6. McKinsey (2007) 7. McKinsey (2011) 8. McKinsey (2011) 9. Forrester (2012)

7. Existing e-metrics don’t quantify financial impact of online tools/channels 8. Quantitative and qualitative consumer insights are rarely measured 9. Embedded in functions with other social enablers and focus on quantitative and qualitative “social intelligence” measures tied to business objectives

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1. Costs and Benefits

1. Watson et al. (2001)

2. Cost Drivers

2. Hinrichs (1997)

3. Value Added

3. Hinrichs (1997)

6. Application of Technologies: The application of social media evolves significantly from departmental driven to institutionally driven applications, integrated into internal systems and processes, and extending to embrace the external value chain (Forrester, 2011a). McKinsey (2011a) found that organisations use social media to support a wide range of processes including monitoring the external environment, ideation, project management, strategic planning, resource allocation, employees’ task matching, performance and compensation evaluation. Organisational content communities can be also be used to share content between stakeholders (Kaplan and Haenlein, 2010), such as Cisco and Google who share videos, slideshows, and images with a global audience, while enabling community members to comment on the material. Organisations such as P&G, also enable community members to upload homemade promotional videos of company products (Kaplan and Haenlein, 2010, p.62). 7.

Impact on Skills: As an organisation’s SMBP matures, it requires internal and external stakeholders to learn new skills and take on new responsibilities, hence the need for training programmes and guidelines (Forrester, 2012). It may also necessitate the recruitment of personnel skilled in social media to manage the new technologies and the conversation created, or sourcing of external assistance from marketing agencies or consultants (Piskorski, 2011; Forrester, 2012). Not all staff may need access to social media. Virtusa defined its use of social media and who would use it, and then developed guidelines and training for common social media and the company blog (Gartner, 2010b).

8. Impact on Internal Stakeholders: As social media evolves in organisations, it drives the re-engineering of internal business processes, changing how people work, increasing staff connectivity, collaboration, engagement, interactivity, and communications (Piskorski, 2011). Social media such as community tools and internal blogging, more easily facilitate employee connections and sharing of information (Forrester, 2012). United Business Media adopted a social media collaboration initiative across their 78 independently operated group businesses in 30 countries, connecting 80% of 6,500 employees in 12 months and driving tangible benefits to the organisations bottom line (Forrester, 2010c). Social media can also be used to locate internal expertise (Forrester, 2012). Thus, McKinsey (2011a) predict that in 3-5 years profound organisational changes will occur as fewer constraints on social media will exist, boundaries between employees, customers and suppliers will diminish, and more employee teams will be able to organise themselves and data driven decision making will increase in importance. 9. Impact on External Stakeholders: An organisation’s SMBP can increase the external stakeholders’ connectivity, participation, information sharing and collaboration with the organisation (Piskorski, 2011). Social media give customers more access to brands, engendering loyalty, creating product/service advocates, leveraging earned media, increasing customer lifetime value (CLV) and increasing the efficiency of advertising (Forrester, 2012). Social media also enable product/service cocreation as customers have a greater voice in the development cycle (Forrester, 2012). Crowdsourcing initiatives are popular for ideation as they enable customers to promote/demote the ideas of their peers, enabling companies to gauge idea potential (Huang et al., 2011). With more than 20 million Facebook fans, Starbucks is a leader in external social activities (Forrester, 2012). InterContinental Hotels Group (IHG) and JPMorgan Chase also used social media to engage customers in co-creation of IHG’s new Priority Club Visa card, resulting in an 80% increase in new accounts (Forrester, 2010d). 10. ROI: To properly measure the impact of social media investments, management must align their objectives, metrics, targets and strategies across financial, digital, brand and risk management perspectives (Forrester, 2012, p.16). McKinsey’s (2007, p.15) suggest “many of the old models for calculating ROI are either of limited value or simply destructive” while “slavishly following models used elsewhere will almost certainly restrict creativity and innovation”. Measures of ROI must evolve from basic data collection, to the use of “quantitative and qualitative measures, and a move toward Social Intelligence with the ability to tie it back to real business objectives” (Forrester, 2012, p.4).Thus, a thorough review of the social media literature suggests ROI metrics for social media should include both quantitative and qualitative weighted measures for technology costs; human resources costs; external consultancy costs; better external customer engagement and communication; reduced customer turnover; increased customer lifetime value (CLV); stronger external connections to suppliers and partners; co-creation with customers, suppliers, and partners; ideation and new opportunities; more efficient internal collaboration; improved online reputation management; and enhanced brand awareness. According to Manish Mehta, VP of Social Media and Community at Dell, ROI “must become embedded in functions alongside other social enablers” (Forrester, 2012, p.2).

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E-Business and Competitive Strategy

Dominant Problems According to Gottschalk and Solli-Saether (2010), dominant problems are varied, change from stage to stage, and can shift from a lack of skills, to a lack of resources, to a lack of strategy. With respect to the implementation of an organisation’s Social Media Business Profile (SMBP), the reported dominant problems include social media strategy ambiguity or uncertainty; business process disconnect; multiplicity due to lack of coordination; monologue due to a failure to listen to/involve stakeholders especially through crowdsourcing, ideation and co-creation; a lack of appropriate security controls; business (social) intelligence (BI) failures in translating social media data into actionable strategies; a failure to establish metrics to measure social media ROI; and exposure of the organisation to lawsuits and legal action as a result of negative comments, reviews, and feedback from internal and external detractors. It is therefore necessary for a stages of growth model to conceptualise the dominant problems. However, Gottschalk and Solli-Saether’s (2010) suggest that empirical analysis is required to conceptualise in which stage(s) these occur. Thus, while this paper has identified from the social media literature, 24 possible dominant problems associated with SMBP implementation as shown in Table 3, this study will not associate them with a particular stage until empirical analysis has been conducted.

Research Agenda The proposed conceptual stages of growth model for managing an organisation’s SMBP is currently being tested in an 18 month longitudinal field study involving 40 small to medium enterprises (SMEs) across a broad spectrum of industries in Ireland. The authors contacted nationwide Business Enterprise Centres (BECs) seeking SMEs engaged, or about to engage, in social media activities, to volunteer to participate in the study, and following negotiations and consideration of the time and cost commitments required, 40 SMEs were selected. Early analysis indicates strong support for the first two stages of growth. However, early analysis also reveals that, SMEs are predominantly in Stage 1, with some having already evolved to Stage 2. Evidence has also arisen, that the Stage 1 may indeed be initiated by management, particularly in small innovative SMEs. However, evidence has also emerged that some SMEs abandon their foray into social media in Stage 1, because it is considered excessively time consuming, and/or the small business owner does not perceive any the long-term positive financial return from the effort required to establish and maintain their SMBP. However, there is also evidence that some SMEs move very quickly through Stage 1, and in some cases, SME business owners are assisted by teenage family and relatives to understand the basics of social media websites. The study commenced in March 2012, and will run until August 2013, with quarterly-analysis reviews. Thus, more detailed findings will emerge in due course.

Conclusions and Limitations A stages of growth model for the management of an organisation’s Social Media Business Profile (SMBP) can play a significant role in the development of both theory and practice. From a theoretical perspective, a stages of growth model builds on existing growth theory and research in IS implementation, and again, illustrates that with a certain amount of adaption for Web 2.0, it is an appropriate method for studying the management of an organisation’s SMBP. From a practical perspective, a stages of growth model for the management of an organisation’s SMBP, enables organisations to determine their maturity stage with respect to use of the technology, while also assisting them in managing progression through the remaining stages, by highlighting key benchmark measures and illustrating the potential for dominant problems to be encountered at each stage. However, given the early stages of this theory development, the rapid development and every changing technological interfaces of social media applications, and the growing pervasiveness of Smart Phone enabled social media access, the proposed conceptual model could be subject to change as the study progresses, in a similar manner to Watson et al.’s (2001) modifications to their data warehousing SOG model, due to changes in the technology. Furthermore, it is possible that additional benchmark variables will emerge throughout the study. The study is limited to SMEs in Ireland; any findings arising from the study may be limited to the business context of SMEs. In conclusion, the authors encourage researchers to reflect on the issues highlighted in this study, and consider SOG models as a valid approach to developing mechanisms and measures for managing an organisation’s SMBP.

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Table 3: Dominant Problems Experienced by Organisations as the Social Media Business Profile (SMBP) Evolves Dominant Problem

Reference

1. Lack of, or inappropriate, social media strategy

McKinsey (2007); Gartner (2010a); Forrester (2011b); Piskorski (2011)

2. Lack of funding or resources

Piskorski (2011); Ponemon Institute (2011); Forrester (2012)

3. Goal incongruity, ambiguity or uncertainty

Gartner (2010a); Kaplan & Haenlein (2010)

4. Business process disconnect

Gartner (2010a); McKinsey (2011a); Forrester (2012)

5. Multiplicity due to lack of coordination

Gartner (2010a); McKinsey (2011a); Piskorski (2011); Forrester (2012)

6. Inauthenticity due to lack of stakeholder passion/creativity

McKinsey (2007); Gartner (2010a); Piskorski (2011); Forrester (2012)

7. Monologue from failure to involve stakeholders through crowdsourcing, ideation and co-creation

Gartner (2010a); Huang et al. (2011)

8. Lack of appropriate security controls and security polices

Ponemon Institute (2011); Websense (2011);

9. Failure to create formal social media usage policies.

Ward & Ostrom (2006); Gartner (2010a); Kaplan & Haenlein (2010); Aggarwal et al. (2011); Piskorski (2011); Ponemon Institute (2011); Forrester (2012)

10. Failure to enforce formal policies

Bott et al. (2009); Ponemon Institute (2011); Forrester (2012)

11. Failure to deliver social media training programmes

Bott et al. (2009); Gartner (2010b); Forrester (2012)

12. Bandwidth pressures, especially due to VoD

ISACA (2010); Ponemon Institute (2011); Websense (2011)

13. Employee misuse

Bott et al. (2009); Ponemon Institute (2011)

14. Increase in viruses/malware attacks

ISACA (2010); Ponemon Institute (2011); Websense (2011)

15. Negative comments, reviews, and feedback from internal and external detractors

Ward & Ostrom (2006); McKinsey (2007); Hamnett (2011); Gartner (2010b); Kaplan & Haenlein (2010); Agarwal et al. (2011); Piskorski (2011)

16. Brand hi-jacking

ISACA (2010)

17. Lack of control over content

ISACA (2010)

18. Lack of senior management support and commitment

Gartner (2010a); Forrester (2012)

19. Lack of understanding of social media

Gartner (2010b)

20. Failure to appoint an individual/group (e.g. steering group) to manage/coordinate social media

McKinsey (2007); Forrester (2012)

21. Business (Social) Intelligence failures in translating social media data into actionable strategies

Forrester (2012)

22. Failure to establish metrics to measure social media ROI

McKinsey (2007); McKinsey (2011); Piskorski (2011); Forrester (2012)

23. Over-zealous management control of social media

McKinsey (2007)

24. Exposure to lawsuits and legal action

Forrester (2012)

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Duane & O’Reilly / An SOG Model for Managing an Organisation’s SMBP

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