Quick Take: Enterprise Social Networking Crystal Ball

Many a CMO, CTO and CIO is asking him/herself when, how and why they should introduce social networking to the enterprise and, unlike startups and consumers, they must contemplate how these emerging phenomena fit with the corporate universe of technology and business processes. Critical to the enterprise adoption calculus is guessing how prevalent new technologies, processes and habits will be, so here is a back-of-the-envelope look at how social networks might look three years in the future.

Disappearance

One thread of which I am certain is that social networks will disappear as distinct entities. This is already happening, as more websites integrate social features. Blogs, wikis and websites are also blurring. Increasingly, if companies want to attract and engage people, they must provide or invoke external tools that enable people to connect with each other. Within the next three years, “social” technologies will be as critical to digital venues as beverages, sofas and armchairs are to living rooms.

Interoperability

Users would like their profiles to follow them and for all networks to interoperate, but by 2010 I predict that it won’t yet be a reality. The business model for the networks is still untested; Facebook’s valuation is mostly about potential and the fact that it creates value through internal network effects. If such network effects were automatic, that would be a huge disincentive for people to launch and innovate through new social network offerings. Also, I don’t think most users have really thought through the proposition. Do they really want everyone to see everything? I doubt it. The controls of a central system that would share information among several sites would have to be very granular to satisfy the customer. But for true aficionados, point solutions are emerging. Here is a discussion on this.

Social Networks in 2011

Facebook will be thriving in 2011, but here are some caveats: I see their key competitive advantage is their architecture and policy of allowing people to build widgets that are extremely easy to light up and turn off. Therefore, Facebook is emergent, where LinkedIn is glacial. The caveat is that the business model is uncertain. If Facebook changes this policy (i.e. charges developers), its competitive advantage would be threatened. However, if more developers start making money, that will change the dynamic. For more on emergence, see this article.

It’s interesting to compare Facebook with MySpace through this emergence lens. The latter is too unstructured. It will certainly be in existence in 2011, but as to thriving, that depends on your definition. Facebook encapsulates functionality within the widgets, so it’s easier to connect along specific vectors. MySpace is far less structured.

I agree that “the Facebook of 2011” may not exist yet. Social networks’ key value prop is “connecting the unconnectable” by leveraging software and network effects. Therefore, I could imagine a more structured approach to connecting musicians, politicians and sports figures with customers. As to music, MySpace is obviously the place to be now, but imagine a music Facebook that scales better, has an emergent architecture and offers unique social features inherent to but as yet unavailable in music.

It is very hazardous to bet on individual Web 2.0 properties now, as it was to wager on Web 1.0 startups for the same reason: the space is extremely dynamic, and there are many factors affecting adoption that we don’t fully appreciate. Social networks are about transforming relationships so in a sense we are on new ground. Obviously, when patterns, habits and expectations around creating and enjoying relationships change, it also profoundly affects business processes.

A Few More Predictions

That said, I’ll hazard this: the social networks that thrive the most will become more specific and focused; this is readily observable in the maturation of all markets as the novelty wears off. “Domain” knowledge within this context won’t be only supply chain, heart valve device manufacturing or aftermarket services, it will be explicit cultural knowledge of what adds to customers’ ability to feel comfortable to share, collaborate and experience products, services and each other. Is that squishy enough for you? It’s also practical, but it’s very new ground for dyed-in-the-wool business process engineers.

To build your own vision, ask yourself, where do inefficiencies exist because people aren’t connected? Social networks reduce the transaction costs of connecting, communicating and collaborating, and adoption is certain along two axes:

• Tools are getting easier to use, richer and more prevalent
• People are getting more accustomed to using them; younger generations are native.

I’ll close with another prediction: given the above, there is considerable inefficiency because people are disconnected globally, and social networks are proving that they can help bring people together around specific interests. Connect the unconnectable.