Today I attended a presentation that looked at the role of social media in business and the role of outsourcing in social media.
I will give the background first and then the outsourcing angle.
Businesses can’t avoid social media. It’s everywhere. Employees at all levels and customers are using it all the time. The next generation of consumers and employees will think and breathe social media.
Legal firm Berwin Leighton Paisner today held a seminar titled: Social Media – A new direction for outsourcing?
A bit different to the usual seminar about how businesses can use social media? It focussed on how it will be delivered. More specifically how it will be outsourced.
The event was attended by representatives of the outsourcing industry in the form of major suppliers and a good selection of corporates, including major banks. So “grown up industries” are turning to social media.
The social media debate has gone from one which discusses should business harness it to one about how they should harness it? Now it is about delivering it.
Two years ago I attended a behind closed doors meeting at the Financial Services Club about the use of social media in financial services. There were mixed feelings about social media’s role. Some said It’s a blip, one said some of it is a total load of bollocks and others that it was bandwagon that cannot be missed. See the article I wrote here.
The general feeling today is that if you are not already using social media you are missing the boat.
Jonathan Brech from social media advisory company ISM Search & Social, says social media is here to stay although names such as Facebook, Twitter and LinkedIn might not. “Names might change but this media is here to stay.”
He described how a company like Dell has used social media successfully. Dell monitors 22,000 social media posts every day, replies in 11 languages band as a result has seen a 30% reduction in posts negative about Dell. But he said Dell had an advantage in that it already sold direct to customers so already had a relationship with them.
Significantly, Brech said that social media tools can be harnessed by any company very quickly but it needs to be handled with care or it could blow up in their faces.
Furniture retailer Habitat famously made a huge mistake on Twitter when it made references to the unrest in Iran a couple of years ago to guide people to some of its sales offers. See the story about that here. What has happened to Habitat since I am less surprised it sunk so low.
But it gets interesting in some very mature sectors. David Power, director at financial service consultancy Red House Limited gave an interesting presentation about how the Life and Pensions industry, which is as conservative as they come, will have to harness social media.
Retail is usually held up as the industry that will use and benefit the most from social media. But there are other industries that will be dependent on it.
Power said the Life and Pensions industry is currently going through major changes, which were instigated by government regulation. The government was not happy with Independent Financial Advisors (IFAs) giving their advice and taking a slice of the customer contribution for themselves, without the customer knowing how much.
The government’s Retail Distribution Review stresses that Life and Pensions companies can’t pay commission to IFA’s but the customer will agree to pay the IFA a certain amount.
The result of this will be reluctance on the IFA’s part to do in-depth consultation such as face to face meetings. Only the richest of clients will be able to afford a face to face service.
And the result of this will be a gap in the market that Life and Pensions firms will be able to fill online through social media. Most potential customers will buy direct after consulting others through social media. “It is not possible for Life and Pensions companies to ignore social media,” says Power.
This brings me on to the outsourcing angle. Life and Pensions companies have outsourced their IT and Business Processes for years.
To set up and manage a social, media strategy and make use of all the communications information will require skills that sectors such as Life and Pensions will not have.
Meanwhile outsourcing service providers have built up their IT and BPO capabilities. These companies have become experts in business processes in certain sectors and they could apply their technology know-how to the social media challenge.
For example Infosys has already created a software package that harnesses social media for businesses. I blogged about the iEngage platform, as it is know, last year.
As social media is taken up by grown up industries it might be time to industrialise the likes of Twitter, Facebook and YouTube.
Please answer the question below to give us some idea of social media use in business.