Alumni Networks
More reading on social networks brought me to the term Corporate Social Networking (CSN) and SelectMinds, Inc., a CSN solutions provider, apparently coining this term. The results of their first annual client benchmarking study done last year, which examined the financial contributions of CSN solutions to a cross section of its client base of 60 leading, global organizations revealed that a better connected workforce through CSN technology can yield significant financial contributions to organizations. Key benefits noted included productivity contributions, retention contributions, new business opportunities and leverage to re-hire former employees!
The latter is an interesting fact. Let us just collect some of the benefits of keeping former employees connected with the company. These relationships are a source of business and employee referrals including the possibility to re-hire them. Social Networking tools are ideal to build an alumni community and integrate it with regular employees. In that way their knowledge can be more easily accessed which could play a major role with retirees.
But the fact of having more direct access to this population with the intention to re-hire them seems to be the most attractive by far as rehires are quickly up to speed when they come back. They bring a huge motivation with them as they experienced that the grass is not greener elsewhere. They came back because they learned to value the company culture more. And in consequence they are more successful than the average employee, get promoted more quickly and make their ways through the organization. Not to mention the obvious: hiring cost for this population is much lower!
Another aspect where Social Networking can bring value is “Relational Onboarding”. The Human Capital Institute found that the quicker new hires establish relationships the more productive, the more satisfied and loyal to the organization they are!
The business network Xing had a conference on alumni networks already in 2006. More information can be found in the SelectMinds White Paper “Increasing the density of connections to power business performance” which can be requested on their webpage.
Posted at
07:22AM Jan 21, 2008
by Volker Seubert in Human Resources |
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Networks versus Matrix
Shortly after I put my last entry online I read another McKinsey article (Harnessing the power of informal employee networks) from November 2007 which even more explicitly positions the formal network as a new model against the matrix organization.
There were some interesting elements that were put forward contributing to the dysfunction of a matrix organization going back to history. Matrix organizations worked well until the late 1980s because they were used sparingly and did not greatly confuse the hierarchical lines responsible for the success of the companies. As the work environment became more complex with the demands of globalization more matrix roles were created as many different perspectives needed to be integrated.
This led to more interactions and decisions to be handled overwhelming the matrix manager. Also the amount of knowledge and information exceeded personal capacities of any individual. In order to work horizontally across an organization employees found themselves confronted with searching through poorly connected organizational silos for the knowledge and collaborators they needed.
McKinsey did a study which discovered how much information and knowledge flows through formal networks against how little through official hierarchical and matrix structures.
So very simply a formal network can be established by splitting up the matrix inherent dual line reporting to one solid line remaining and the more functional oriented line substituted by a formal network that through better knowledge flow and quick relationship building is for instance far better suited for best practice sharing.
A clear owner of such a network is needed and the scope of activities need to be defined to avoid network overlaps. Most interestingly the article talks about a “servant leader” in this role as this individual is not a boss but a facilitator of interactions between members, responsible for the infrastructure (which requires a budget!), training, incentives for participation and contribution. So enough possibilities to influence the performance of the network to be held accountable for it. Very clearly these networks need to exist outside the hierarchical decision-making processes within the company.
All the value can be accelerated by having many different networks exist in parallel. Then there would be an effect of cross fertilization through employees being part of multiple communities.
I believe success is dependent on the buy in of the senior management of a company as structures need to be provided meaning serious investment is needed and on the other hand on the “servant leader” who needs to be charismatic and experienced in motivating employees to collaborative behavior.
Value of Social Networks
Recently I put together a few slides about the benefits of social networks to update our team. As you know from some of my former entries I strongly believe that Human Resources professionals need to get on top of this trend as it is touching many different HR related topics: organization consulting, change management, communication, learning, team collaboration, compensation, retention, motivation, leadership requirements...
Here are the slides, let me briefly go through:
What is Web 2.0? - Starting off with a brief explanation: The phenomenon of Web 2.0 appears to me as two fold. On one hand all the people participating via blogs, videos, etc. contributing, sharing and voting. On the other hand new technologies that make it easier and more comfortable to find information and consume information. This reminds the Sun Microsystems vision statement on the next slide: “Everyone and Everything participating on the Network!”
Use of Social Networks – Coming to the core, describing purpose and resulting benefits of using social networks in a company.
Concept of Social Capital - How to explain that Social Networks are so beneficial? They add value because they increase the social capital of a company and more social capital increases productivity through higher levels of collaboration.
Communities of Practice - One type of Social Network that is in the focus for being used in a business context. It is a Social Network based on knowledge sharing and learning and has already been looked at before the social revolution with Web 2.0. Call it a classic.
Improving Organization Performance – Visualizing how Communities of Practice increase social capital and finally increase organization performance.
21. Century Organization - Taken from the McKinsey article I mention in one of my blogs putting into perspective nowadays work environment. McKinsey talks about establishing formal networks, meaning nothing else than specific accountable social networks or call them communities of practice that leverage out many of the disadvantages of today's prevailing matrix organizations and provide an ideal background for knowledge workers to give their best.
What is in it for HR? - Play a role in increasing the intangible company value that makes up more and more of the overall company market value, some say up to 80%! Provide mechanisms to motivate and retain the 21. Century workforce of predominantly self directed knowledge workers with innovative recognition models based on collaboration and participation goals that can be measured. And build appropriate leadership capabilities to motivate collaborative behavior!
For a practical example how to measure read Peter Reiser's blog about community equity showcasing one of our internal examples of a social network!
Posted at
09:38AM Jan 09, 2008
by Volker Seubert in Human Resources |
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Aspects of Enterprise 2.0
In a recent article about Enterprise 2.0 I discovered some interesting aspects on the effectiveness of social networks: companies using external collective intelligence to drive their innovation. In March 2000 Canadian gold mine company Goldcorp Inc. put 400MB of geological data on the internet which described a 200 square km sized area. Under the name of "Goldcorp Challenge" everyone could do data analysis and give hints about potential gold prospects. The community identified 110 spots out of which 50% were not known by the company before and finally at 80% of these gold was found. Over $500.000 were paid as prizes.
What made this idea so effective is that not only a lot of people worked on the problem but it were people with many different backgrounds, not only Geologists, also Army Officers, Mathematicians, Physicians, all of them using different techniques to solve the problem. The more people contribute and look at a problem from different angles the higher the probability to find a solution.
There are web based communities matching top scientists to specific R&D challenges, like Innocentive used by Procter and Gamble. They cut their own investment in product development by 50%. There are other examples of how to reduce service cost by delegating queries to "Service Communities" in which two thirds of them were solved by users helping themselves.
Also interesting is the use of virtual worlds like Second Life or There.com in business context. Human minds are more attentive to interaction in 3 dimensional spaces and therefor in an enterprise these are currently used for communication (e.g. virtual meetings), learning (e.g. flight simulator), marketing (e.g. the Dell shop in Second Life or a virtual data center which can be used to explain the efficiency of complex products), product development (e.g. 3 dimensional models of a new car prototype) and for the control and simulation of business, production or logistical processes. Also Sun bought land in Second Life and was the first Fortune 500 company back in October last year to hold a press conference there!
The technology is there and is improving every day, just a question of time to see new business models popping up based on it.
Posted at
08:11AM Jul 02, 2007
by Volker Seubert in Human Resources |
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Communities of Practice
Let's continue the topic of virtual communities I started in my previous blog entry Distance Collaboration. I had the opportunity to read some materials I got from a workshop that our Customer Engineering Programs group held last week on the communities topic. Included was an article by Wenger/Snyder from the year 2000 on Communities of Practice (CoPs) as another organization form.
My blog entry about enterprise 2.0 referred to formal networks that could be used instead of matrix organizations. CoPs are in terms of structure the most lose organization form compared to informal and formal networks, project teams (matrix organization) and formal work groups (reporting to the same manager and as such reflecting the traditional hierarchical organization). Their purpose is mainly to develop member's capabilities and to build and exchange knowledge based on passion, commitment and identification with the group's expertise. Members of an informal network collect and pass on business information based on mutual needs. COPs are mostly virtual given today's business environment, self-driven and not accountable to any institution. Participation is on a purely voluntary basis and members of CoPs select themselves. To function they need a credible, sensitive leader with active listening skills and a sponsor.As a result of extensive knowledge building CoPs can drive strategy, generate new business lines, solve problems, promote the spread of best practices, develop people’s professional skills, and help companies recruit and retain talent by giving a home and new challenges to those who want to leave. They can be kind of incubators within the organization informally working on new contrarian ideas that at a more mature stage could be recognized as significant innovations.
How identify and build them? Management needs to recognize current trends with their employee populations. To make proof of those trends there could be an interviewing process to find out about the passion and interests of employees going in a certain direction. Then the company is able to provide infrastructure, like budget, places to meet, reward structures for participants, etc. Something that the Human Resources functions can help drive. The community itself will then start to give themselves ground rules, organize regular events.
To hold it together the passion and commitment of it's members needs to be sustained by a common sense of purpose (they know what binds them together) and a believe in the cause (worthiness, WIIFM – what is in it for me).
In terms of measuring the value of communities Wenger/Snyder refer to systematically listening to member's stories how they benefited from the community. Again formal interviews could help structuring this. In any way we need nontraditional methods of measuring the value of CoPs. Another possibility could be to assess each employees social capital by evaluating their community equity value consisting of measuring contribution, participation, skills and role equity of a person. Peter is actually engaged in this work at Sun and posted a blog on this concept today!
Posted at
08:49PM Jun 24, 2007
by Volker Seubert in Human Resources |
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Web 2.0! Enterprise 2.0! HR 2.0?
Peter Reiser is really working on interesting stuff which he lays out in his blog “Web 2.0 applied in an Enterprise – a huge business opportunity”. He is using the case of Sun's internal Customer Engineering Web to describe how effectively set up a community or formal network within an enterprise. Let me pick this up and give some thoughts on why I think Human Resources needs to embrace Web 2.0 more. I even believe HR's involvement is crucial on a company's path to Enterprise 2.0. The article “The 21st-century organization” gives a lot of evidence on this and I will use parts of it in this entry.
I actually see 4 different benefits to using Web 2.0 mechanisms in and beyond the enterprise:
Knowledge Management: Employees contribute and share content via a network platform or portal that has all Web 2.0 features like tagging (which creates a folksonomy), wikis, search engines and voting in order to systemize the content and make finding content as well as contributing it really easy minimizing search and coordination cost.
“Knowledge workers” (also referred to as “tacit employees”) in many industries (e.g. high tech industry) account for 25 percent or more of the workforce. They undertake key line activities and are the innovators of new business ideas. Therefor it is key for the productivity and even innovation capabilities of a company to create an environment that motivates them to give the best.
HR can play a major role initiating these communities and platforms and implement the recognition model around it to secure motivation of employees to contribute high value content. Employees who are main contributors and highly valued could be voted by the community to become a member in a special group of employees who will have access to a set of benefits like being part of management teams as advisor, or have the possibility to pursue specific career paths.
Skill Management: Through active participation in the community employees will make their reputation as experts for specific areas. In addition every employee could be asked to establish a personal page which describes his/her experience in the form of tags. Then employees with specific experience could be found easily via search.
On the other hand the company would have the possibility to know if there were only one or two experts in a high demand area and could start initiatives building those missing skills.
Learning departments in most companies belong to HR, so this area is a key HR topic. HR and the learning organization should be the driver of implementing innovative Web 2.0 models to do skills management in an enterprise.
Communication: The most obvious element of Web 2.0 benefits for communication are probably blogs. Internally they can be used for information sharing and as discussion boards for new ideas. The web based communities foster communication amongst their participants integrating remote working employees and teams. They facilitate communication across organization boundaries. In times of an increasing matrix environment it becomes more and more critical to provide an environment for employees to gain more easy and comfortable access to information in order to participate in business processes.
HR has a crucial interest in good internal communication to create an open company culture, overcome organizational barriers and keep employee morale and motivation high. The internal communication function is mostly tied to HR.
Partner Relationships: It may not be obvious why internal communities should be expanded to external partners like customers, suppliers or resellers. There are multiple benefits: tie them to the company, keep them informed and give access to crucial information but also receive the benefit of more members participating to the community and sharing contents.
All of the above benefits are based on a community of actively participating employees or simply the benefit of established formal networks. HR can initiate these networks, can help formalize the role of the network within the organization, can make sure that an owner of a network is found and established, can develop incentives for membership, can create frameworks with standards and protocols that makes the network flourish.
A formal network with specific areas of economic accountability can be used instead of a matrix structure as it often serves to attain the same goals with the difference (and benefit) of having to manage a community of self directed employees instead of a hierarchy. It makes working horizontally far more cost effective and takes tension out of the system. The performance management of self directed employees on the other hand is critical. To motivate behavior, measuring performance is more important than providing financial incentives to reward it. Metrics must be established and tailored to individual roles and people.
Overall, creating a state of the art environment will make employees feel more valued and does not only lead to higher productivity but also retains employees!
Posted at
09:41PM Mar 25, 2007
by Volker Seubert in Human Resources |
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