Enterprise 2.0, social ERP, and other buzzwords related to enterprise software combined with social media are quickly gaining momentum in the ERP software industry. Industry analysts and research firms regularly cover the potential convergence of social applications like Twitter, Facebook, and Yammer with traditional ERP systems like SAP, Oracle, and Microsoft Dynamics. For example, last year IFS North America and Affinity Research Solutions conducted a study of manufacturing executives to determine their interest and understanding of social ERP.
The study from IFS outlined several potential benefits of social ERP, including the ability to better capture the tacit knowledge of employees and ability to better streamline communications between employees and customers. In addition, executives also pointed to increased organizational flexibility and an ability to cater to a younger generation of employees more accustomed to Facebook and Twitter than they are to structured manufacturing ERP systems. Based on this and other research conducted in recent years, it is clear that this potentially inevitable convergence of enterprise- and consumer-based technologies is on the radar of most executives and industry analysts.
However, following these trends has led me to question how two very different types of technologies will really align themselves. One the one hand, you have informal and unstructured consumer-oriented social media tools like Facebook and Twitter where anyone can say about anything they want without any real controls or structure. On the other hand, you have large structured enterprise systems with controls surrounding master data, security profiles, and standard workflows. One is simple, flexible, and supportive of a flat organization, while the other is more conducive to a larger and more controlled organization.
To illustrate the contrast, look at the situations of many of our clients: they have outgrown their simplistic and uncontrolled systems and are looking for something more standardized and structured to help them scale for growth. Many have multi-national or multi-site operations that are misaligned with their current systems. As such, our client executives are often looking to ERP systems to help them standardize, control, and scale – not exactly terms one thinks of when describing social media tools. So the real question is: can both structured enterprise software like SAP or Oracle co-exist with unstructured social media tools like Twitter and Yammer?
I think the short answer is not yet, but companies will need to find a way to leverage the best of both worlds. Below are four considerations when examining the potential integration of social enterprise systems within your organization:
1. Make ERP systems more flexible and social interactions more structured. One of the frustrations most organizations and their employees have about their current ERP systems is the relative lack of flexibility. As companies grow, their enterprise software needs to remain aligned with evolving business processes and requirements, but this is often unachieved. Social media capabilities similar to Twitter and Yammer provide potential flexibility in how employees interact with customers, vendors, and internal colleagues. Social media tools and their flexibility can be powerful, but employees also need clarity and definition on how to use the tools. You obviously don’t want employees sharing too much information about customers, products, and financial information, so there needs to be a balance between flexibility and standardization.
2. Focus on the strengths of each technology. Enterprise software is good at providing back-office controls and standardization in areas such as finance and accounting, while social tools can be more beneficial when it comes to customer interactions and capturing undocumented knowledge in people’s heads. It is important to identify where the strengths of each fit within your organization and business processes and leverage each competency accordingly. Just as you want to avoid misalignments between traditional ERP and your business processes, you also want to make sure that social ERP systems are aligned with your operational needs.
3. Define your business blueprint. Just as with any ERP implementation, successful organizations should clearly define their business blueprint for social ERP. Clarity around business processes, organizational roles and responsibilities, and performance measures will ensure that the system is designed to support business processes and tested accordingly. Documented business processes and use cases should clearly define where standardization is required and where there is some latitude to deviate from standard business transactions. These components are critical to a successful social ERP implementation and should be addressed prior to rolling out the new technologies. In addition, this clarity and definition will help ensure that you select the right ERP system that addresses the various social and enterprise software needs of your organization.
4. Don’t forget organizational change management. It’s easy to forget about organizational change management and assume that social ERP is going to be much easier to adapt than traditional enterprise systems, but the reality is that it will entail significant operational and cultural changes for most organizations. Tenured employees will need to adapt to a less structured and different way of doing things, while newer or younger employees will need to adapt to balancing social tools that they’re more accustomed to with more structured ERP processes and systems that they may not be comfortable with. In both cases, organizational change management activities should be incorporated into the overall implementation plan to assure processes are understood, employees are trained, and that roles and responsibilities are clearly defined.
At the end of the day, social ERP and CRM applications will be a reality for most organizations sooner rather than later. By incorporating the above four tips into your enterprise 2.0 initiatives, you will ensure you get the best of what the convergence of these two technologies has to offer.
What is your take on social media applications in the workplace? Do you think it’s advisable (or even viable) for organizations to pursue? Let us know your thoughts and experiences in the comment section.