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Social Media Scorecard III

As is well known there’s a great deal of chasing for the holy grail when it comes to finding the ROI and real metrics on enterprise social network activity (by this I mainly refer to social software inside the firewall rather than social media marketing). This to my mind isn’t so much a mistake as an attempt to measure activities that are extremely difficult to pin down, quantify and evaluate in any effective way or manner.

What I think we need to work towards is a more holistic overview, one that uses an approach of a social media scorecard. As I’ve blogged before the inventor of the balanced scorecard Bob Kaplan says it can’t be done with Social Media. I’ve the temerity to disagree.

What I’ve done is take Forrester’s one for IT and reapply it to social media.  I don’t see this as at all finished. It’s a move toward a balanced scorecard for the social enterprise and I reserve all caveats about the usefulness of scorecards per se. Nevertheless, I think I’m onto something here…

Goal Social Media Activities Candidate Social Metrics
Employee Engagement Increase employee engagement via genuine dialogue and polyphonic communication channels. Overcome Generational Shift. Discussing! Employee Satisfaction Surveys, Polls, Feedback from Social Media Channels (% Csat), CSAT on Generation – Y + Millenials + Boomers
Innovation Increase level of innovation via Innovation Wikis (e.g., Cisco I-Zone), Competitions and ‘wisdom of crowds’ gathering of info activities. Listening! Number of ideas submitted, number of successful ideas turned into pilots, number of pilots entering the market as new products. Time to market ratios.
Increase Productivity Increased productivity % increase, contribution in $/£ per employee
Improve Customer Experience Increase revenue per customer, increase engagement from the customer, social marketing Customer retention / satisfaction, inputs into marketing process, overall cost of marketing $/£ per $/£ sale
Social Engagement Connections, sociality of employees via Enterprise Social Networks, 2.0 profiles, Tagging across the Enterprise, Expert Locators, Silo Busting Social Network Analytics, (NodeXL), Measure of Relations, Overcoming Geo/Time barriers with synchronous & asynchronous comms / collaboration = decreased travel budget. ratio of flights/meetings vs online engagement.
Learning Social Learning, sharing of information, 2.0 Training, e-learning, EMS. Cost of training, number of courses taken/passed, diversity of learning offerings, CSAT. Degree of ‘Knowing what we know’ better.
Raw Competition Social Software as cumulative competitive Advantage Who dares wins & who doesn’t, appears in the next edition of ‘In search of Stupidity‘ 😉
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Creating the Social Media Balanced Scorecard, doing the undoable….

Conducting some research I’ve stumbled across an interesting quote (& this blog is but a jotter of my thoughts) that I suspect might be an old chestnut by now.  It’s new to me though so here goes.  & it comes from Bob Kaplan inventor of the Balanced Scorecard and relates to measuring the ROI of social media. Kaplan’s quote on the ROI of social media is succinct and cuts so quick to the point as to leave little behind:

“you can’t do it.”

I found the quote on who explain that “Measuring Social Media ROI is a pipe dream

Trying to calculate the ROI of social media is the same as trying to calculate the ROI of email or the road you drive to work on. The costs can be approximated but the benefits can’t. Their reach is too broad and too many other factors are at play to even to list them all, let alone attempt to measure profits.

Now this I find interesting and and in equal measure implausible – I don’t believe it.

Now I don’t have much ammo to refute it and I’ve even less expertise. This simply ‘aint my area. And yet it keeps on coming up – there must be a way of making the Social Media Balanced Scorecard.

So where to start? Well where I started to think about this was in 3 broad areas

1) Impact improvement on existing process: time to create, to sell, cost of production etc etc etc

2) Innovation – doing what was not done before, idea Wikis and the like. Making new stuff happen.

3) Business Transformation – when 1 & 2 fuse in completely unexpected ways.

But where to strap the numbers to? Well on this, I first started to think about Balanced Scorecards – hence finding the quote from Kaplan. This is an interesting area and all I have to go on at present is an old report from Forrester from 2004:  The Balanced Scorecard For IT: Value Metrics. Forrester supply a suggested list of scores:

balanced scorecard

They’re keen to stress though that,

When it comes to IT value metrics, there is no silver bullet, no single metric that provides the appropriate answer. However, with strong alignment between business strategy and IT strategy, it is possible to start making the necessary links between IT investments and their business value. We suggest using a number of diverse, financially oriented metrics to capture the breadth of IT value delivered.

This provides for me food for thought though. Can we correlate this to enterprise social media, to enterprise 2.0? Or more pointedly:  is your social media strategy aligned to your business strategy and if so in how much and in what form? And where next with Forrester’s other factors, can they correlate to scoring against the success of enterprise 2.0?

Update, 31st December 2010 – I’ve developed this idea on the making the Social Media Balanced Scorecard to that of creating the social business scorecard, please see my post: The Social Business Scorecard IV, or ROI made easy