More on gaining social capital by losing good people

I posted last month on April's Harvard Business Review article explaining that an old employer's social capital may go up after an employer leaves.

This dealt specifically with the increase in patents a firm might experience after the departure of an inventor to another company. The point is that the old firm tends to gain knowledge from the new company (through an increase in social / relationship capital) as well as the new company gaining knowledge (in the form of human capital) from the old firm.

Well there is also some research reaching very similar conclusions in this Summer's MIT Sloan Management Review.

This research suggests that although it is appropriate to take defensive manoeuvres (such as improving employee benefits in order top retain existing workers) when employees join competitors, relational actions (such as setting up alumni programmes to maintain positive relationships with former employees) may be more appropriate when they join 'cooperators': such as customer companies, suppliers and partners.

So instead of focusing on suppressing employee mobility, companies may be better actively seeking to exploit the potential opportunities it creates.

These potential opportunities are created by the social capital embedded in the companies' relationships with the departing employees.

Social capital is defined as the sum of the actual and potential resources embedded within, available through and derived from relationships.

The article explains:

"When employees move between companies they often maintain contact with former colleagues. Because of the trust and comfort embedded in these ties, employee mobility can create a conduit for information, allowing knowledge to flow between organisations. There relationships can also serve as the basis for future business dealings between companies. In addition, because mobile individuals possess knowledge about the capabilities, work practices and processes of their former employers, they can make interorganisational endeavours more efficient. Thus, the social capital created by the movement of employees across companies can be a key source of competitive advantage."

And they provide the following example:

"Not surprisingly, we found that the business a law firm received from existing clients typically decreased when key attorneys left to join competitor firms. But other results were at odds with the traditional "war for talent" perspective. When lawyers left to join a prospective client, the likelihood that their former employer would receive new business from that company increased. In addition, we found that hiring employees can have important social-capital implications depending on where those individuals are hired from."

Who owns the social network?

Chief Learning Officer magazine ask which function (HR, IT, corporate communications, knowledge management or learning and development) should own an organisation's approach to social networking.

Their answer:

"HR is more likely to own any internally facing social network, but that arrangement isn’t common enough to be considered typical.

When you look internally at an employee-oriented community, you’ve got a number of benefits or goals that you’re looking to achieve with social networks.

They help create a corporate culture of sharing and teamwork. They help increase intracompany communication and collaboration. They facilitate the identification of subject-matter experts. They can improve employee retention because technology is creating new bonds among employees and between employee and company, and that adds a human element to the company.”

Given my past couple of posts about HR's role in steering web 2.0 and social networking, there's a lot of ground to make up before they can take on this role.

Come on in and play

Commenting on a recent post on web 2.0 for recruitment on my HCM Blog, one reader noted that HR's use of the available technology tends to be quite poor.

I think that's largely true.

The CIPD's web 2.0 in HR report notes that:

"More than 30% of the population (UK) have read a blog, 10% have created one and nearly 7% subscribe to an RSS feed."

Now I'll accept these results although they do surprise me, but I absolutely know that they don't apply to HR (in the UK at least).  Social media came up quite a few times at last year's CIPD conference (I think this led in part to the new report) and very, very few people there had read a blog.  I think I was the only person in the room who had a Second Life avatar when one of the speakers asked about this.

So if you're an HR professional who is reading this post, I think you're well ahead of the curve.

This leads me on to a further criticism of the CIPD report (remember my disclosure - I bid for this piece of work and didn't get it so I suppose there my be some axe grinding going on here).  The report states:

"Broadly speaking there are two routes for organisations to travel.  The first is to develop a policy on using Web 2.0; the second is to develop Enterprise 2.0 applications inside an organisation's firewalls and those of partner organisations."

Firstly, I don't agree that the difference between web 2.0 and enterprise 2.0 is about whether the tools are open publicly available tools (like Facebook) or closed corporate tools (like Jive, Select Minds etc).  The difference relates to the tool (web 2.0) and the use of the tool in an organisation (enterprise 2.0).

But more importantly, I think there's a third option which the CIPD has missed (I did tell them!).  And that's to get personal experience of the tools yourself - whether for business or personal use.

As an HR practitioner, you can read the CIPD's "illustrations of some well know Web 2.0 inputs and transfer technologies" (?!) and be none the wiser.  Listen to, subscribe to, and ideally produce a couple of podcasts and you're in a much better position to understand the benefits web 2.0 could provide to HR and to your organisation.

What was really needed was a guide and support to help HR play with this technology.  Time to jump into the sandpit anyone?

CIPD: HR's use of web 2.0

The CIPD have published a short, initial discussion document on 'HR's use of web 2.0 for strategic business impact' (disclosure: I bid for this work but didn't get it).

The report includes case studies provided by Pfizer, 3 government departments and T-Mobile.

I'm pleased to see that the CIPD recognises that web 2.0 provides 'the potential to change the way people interact and work' which 'offers HR a new way of making a significant contribution to an organisation's strategic and operational goals'.

However, I'm not sure the report offers much to help us do this (and to be fair, I don't think that's its objective either).

I think part of the problem is that the report concentrates too much on web 2.0 and not enough on what we can do to change organisations by using this technology.  This may sound a small distinction, but I think it's an important one.

Yes, it's possible for technology to present completely new opportunities to organisations (to create value - in the way I suggest people can do) and this can be most easily discovered by looking at the inherent value in the technology.  But in the main, we're not yet even looking at how web 2.0 can support existing business / people management objectives (adding value), and I think this needs to come first.

After all, experience in various areas, for example, e-learning, suggests that the actual technology doesn't matter that much; it's how this is used as part of a blended solution to achieve certain learning and business objectives that counts.

So what are these objectives.  The CIPD report suggests that they include:

• Encouraging greater collaboration
• Giving employees a greater voice
• Helping them learn about each other and potential employees
• Sharing their knowledge and experience.

I think that's a good list.  But the report then seems to focus on using web 2.0 to support HR's own agenda (meeting people management objectives eg through learning and particularly recruitment - given the side references to the CIPD's Recruitment and Retention Survey) rather than how HR supports the business agenda (relating to the bullet points above).

For example, when discussing employee engagement, it seems to suggest web 2.0 can be used to replace more traditional surveys, rather than much more powerfully, reshaping organisations to give employees more voice.

I think what I'm saying is that we should focus more on enterprise 2.0 (which I would define as the social organisation) rather than web 2.0 (the tools that enable this).

One thing I do like the report is that it's been produced to elicit  more inputs and opinions from the HR community in order to inform and the second stage of the research.  So it's a good example of using a social approach that encourages collaboration.

I think it would have been useful to spell this out more clearly - this is all we're talking about when we're discussing social tools.  And I think the mechanisms and for and benefits of developing collaboration are worth more focus than the tools.

Toyota's nerve system

There’s a great example of best fit people management in this month’s Harvard Business Review. The article proposes that Toyota’s ability to manage contradictions (along with the Toyota Production System) is the main source of the company’s success.

I don’t deny that dealing with paradox is an important capability, and in fact it is increasingly so, but my reading of the research identifies Toyota’s development of social capital as the engine of the company’s growth.

So I could have posted on this here, but the case study is a great example of best fit HCM as well so I actually did so here.

Do take a look.

Rehumanising the workplace / BT

Contrasting with the Microsoft case study, this was an example of social media being introduced ‘under the radar’.

I’d come across the case study earlier on Melcrum's blog and have also subscribed to Richard's.

The case study means quite a lot to me because of some earlier involvement in BT, which included writing some content on performance management for their intranet. I also had several conversations with Margaret Savage while she was at BT about liberating employees from over controlling managers – social media seems to have been one way that BT has been achieving this. (I would have said achieved if it wasn’t for the 20 calls and 3 different attempts to get a BT phone line installed recently)

BT have 160,000 active users on BTpedia and 215,000 different people have published content. They have had to give 100% access because all BT’s processses and systems are online and this includes the whole extended enterprise – in fact there are more contractors than employees on the intranet. So it has been a successful initiative to democratise communication.

I think one of the things that has made this so successful is Richard’s belief that it’s all about participation. In his view, and in mine, social media is about an ongoing dialogue, about creating a conversation rather than channels.

Richard explained that people tend to shut down facets of their personality when they put their suit on – to feel that they can’t say what they don’t like – to have to sit on their hands – that we expect people to be totally different at work. Social media rehumanises the workplace. People have personality – why can’t they have personality at work? What does it matter if people talk about their dog?

I thought this was a great point, that reinforced some of those made by Ethan at IBM - it doesn't matter if social media is used for personal information as this is important and part of the business too.

And social media isn't about managing, but facilitating communications. Tobias Huebscher from eBay argued that content is still key. But social meda shouldn't be about pushing content. Even a CEO blog isn't really about communicating messages but connecting him or her with their employees. I think IBM, Microsoft and BT have been so succesful in implementing social media because of their understanding of this point.

Microsoft Academy Mobile

I thought this was a great case study of social media implementation - and the opposite of the "sneak it in" approach.

The implementation started slowly with pilots, the development of some content, getting management onboard and identifying champions, but then took place through a very major launch. People were provided with podcasts on SD cards and were supported to try podcasting out. To take it forward, Microsoft provides 'podcasts in a box' - all the equipment someone needs as long as they produce 3 podcasts a month.

More thoughts on employee communication (part 2)

3. Trust your people and use social media

Presenters gave some great examples to show that organisations have lost control of the conversation. Employees are going online to join interactive conversations about our companies – we need to enable this.

The best web based communication combines web 2.0, the research web by giving people access to data; web 2.0 - the social web by giving access to tools, and what Steve Crescenzo termed web 3.0 - the multimedia web by entertaining people.

We saw some great examples of web 2.0 in organisations including (as well as IBM), Microsoft, BT and ebay. It’s a shame these are e all technology companies but as Marc Wright pointed out, we’re still at a very early stage in the development of social media – things will be very different in five years time. So it’s important not to codify approaches and to keep aware of trends and changes.

But we’re not going to be able to put the genie back in the bottle. People are using social media in their personal lives and are increasingly going to expect to be able to do so at work as well.

So how do you get your organisation interested? Mark recommended searching out the people with both power and enthusiasm and through this approach, seeking senior level endorsement. Don’t force people who are resisting the technology to say no – once they do they won’t say yes.

A couple of presenters recommended down playing the new aspects of the technology (“sneak it out”) – for example by talking about allowing people to publish and comment, rather than using the word ‘blog’. (However, this isn’t the approach used by Microsoft and I’ll post on this separately).


4. Measurement

I didn’t get much out of Susan Walker’s formal presentation on measurement but Ethan McCarthy from IBM; Paolo Tosolini from Microsoft and Richard Dennison from BT all talked intelligently about it.

Paolo explained how Microsoft measure their Academy Mobile system (their “enterprise you tube”) using reach and awareness (downloads, reach) and operations (number of podcasts on Academy Mobile, number of podcasts produced, number of profiles).

However, he emphasized, supporting Ethan's perspective that it is very difficult to calculate a ROI so they, like IBM, focus on the use of testimonials which are sent to the CEO. He believes it’s about belief rather than a hard business case: they need to “go for it because we believe in 2.0 / social media”.

Richard’s perspectives on measurement are included on his blog. Readers of my HCM blog may recognise some of these points from some of my previous posts.


For further perspectives on the conference, check out:

http://www.krishnade.com/blog/2008/international-employee-communications-summit-2/

http://talkingic.typepad.com/foureightys_lee_smith_tal/2008/06/view-from-the-summit-day-two.html

More thoughts on employee communication (part 1)

Here are the rest of my key learnings from the Internal Communication Summit that I have been attending over the last two days.

One point that was made several times is that there are increasing challenges in delivering communication that gets read by, and leads to new understanding or actions by employees. Firstly, it is growing harder to get people’s attention, particularly when they are picking up their emails on blackberries and other devices. Secondly, there is increasing cynicism over use of business-speak. People are sick of hearing from ‘suits’ who aren’t seen as authentic and end up playing bullshit bingo.

Organisations can respond to this new environment by:

1. Revising the way they talk about themselves

Organisations need to communicate using the normal language of employees. Jim Ylisela from Ragan pointed out that senior managers often think and talk in terms of long, fancy titles; a lofty vision statement: a set of core values: circles, pyramids, Greek temples.. Employees simply want to know what does it mean?; what does it mean to me?; what do you want me to do?; why should I care? And how can we help?

The 2006 Annual Edelman Trust Barometer explains that a “person like yourself or your peer” is seen as the most credible spokesperson about a company and among the top three spokespeople in every country surveyed.

We trust…
• Each other
• Independent subject matter experts
• NGOs

We don’t trust…
• Business
• Government
• Mainstream media

So we need to make the impersonal more personal. Organisations need to close the disconnect between what the strategy requires and the way organization works now.

This is particularly important while going through change. Marc Wright from Simply Communicate talked about: Disphasing between the CEO and employees going through the Kubler Ross change curve. It’s important that organisations don’t use the boss’ language with people when they’re in this position.

But changing the way we communicate isn’t enough – to be authentic, we also need to change what we’re communicating.

So, for example, Marc talked about Vodafone moving away from discussing its competitive positioning (“We want Vodafone to be number one”) to defining itself based upon what it is – looking into its soul and trying to identify its DNA (see my posts on meaning LINK).


2. Structured and creative communication planning

Communication professionals tend to focus on ensuring copy is safe and that it gets in on time. The result of this is that nobody reads it.

Jim’s process to avoid this is:

1. First, listen to your audiences. Learn what gets their attention
2. Next, create a strategy to reach them
3. Then, figure out the best way to deliver your messages

· Print explains “what” and “why” but not “how” and not information which needs to be timely
· E-mail alerts people to timely information and pulls them to the web
· Intranets allow you to provide timely news, link to more information, interact with the audience and use multimedia tools like podcasts and video
· Social media generates ideas, solves problems and gets people talking about what the organization is trying to do and how they can help.

Ellen Coomber from Cognac also emphasised the need to use visual communication and William Amuris from American Electric Power talked about emotional communication: “Design the personality you want your intranet to have”.

4. Finally, make sure it’s working. When it doesn’t, make adjustments.

The mother of all intranets: IBM’s w3

A couple of days ago I was listening to an interesting Business Week podcast featuring the journalists who recently updated the magazine’s article Blogs / Social Media will change your Business.

Talking about IBM, the journalists explain that the firm is developing their own versions of social media tools like Twitter, Facebook, Delicious and Wikipedia to develop not so much an intranet, but an intra social net. They see the key to getting their 400,000 people on this as making the tools corporate without loosing the magic and appeal that comes with using them when they’re outside and free.

The tools are giving IBM employees new ways to communicate with others, to engage with others and to build new types of team. And they’re seen as the key to innovation.

In addition, it helps IBM to appeal to the best and brightest of the 23-27 year old graduates they want to recruit, who would otherwise see IBM as a bit clueless.

And they help the company to look at its workforce – to study peoples’ behaviour, to see who is networking with who, who is communicating with who, what knowledge and areas of expertise they have. All of this will help them optimize their workfoce.

All interesting stuff. So I was very pleased yesterday to hear from Ethan McCarthy at IBM describing the development of the firm’s intranet.

Firstly, this was a direct response to the company’s workforce transformation strategy which included the goals to:

· Move from organisation centric to employee centric model
· Bring the marketplace inside
· Drive flexibility and productivity through new tools
· Collective knowledge
· Dynamic manager / employee relationship


Given these objectives, the intranet was built around the employee, and is based on their user profile, populated from the HR system and the individual themselves.

71% of employees say that the intranet is their preferred sources of information (above co-workers, their manager, senior exec letters, IBM.com and external media). See also this article from Ragan and IBM's blogging guidelines.

We also talked about IBM’s corporate directory, ‘Bluepages’. This includes much more than just someone’s phone number – it includes a lot of personal stuff – about what someone has been doing and which is vital to help people to connect in a knowledge based business.

There is also a social network, ‘Beehive’which enables people to connect through shared content. This includes both personal and professional information and IBM is fine that some of the information is personal because “this is business as well – it’s sociological and therefore important”.

In fact the personal stuff gets more interest than editorial so there is a need to use this strategically.

IBM also have an internal wikipedia (‘Bluepedia’) and enables people to set up their own wikis.

They have also socialised search: by using tagging so that people can see how other people have tagged information, and who these people are.

Ethan emphasized that given the size of the business, all these tools are essential to connect people who would have otherwise never had met and to build on the ‘weak ties’.

We also talked about three further areas that were particularly interesting to me:

1. Using communication to provide meaning

As IBM continues its move from products to services and consultancy, there is an increasing need for people to understand not just what IBM does, but the impact of these activities. They are therefore publishing a series of articles under the title “What does IBM make?” (for example, greener hospitals) and is seen to support peoples’ for self actualization.

2. Selling the benefits

Ethan still faces some challenges about whether people are wasting their time blogging, but he hears this a lot less now than he did a few years ago.

This is partly due to the way the intranet supports IBM’s strategy and values. One of these values is that ‘innovation is inherently collaborative’. Sometimes it may happen through people working in ivory towers but this is the exception not the norm.

These values were developed in IBM’s online innovation jam held in July 2006 and in which over 100,000 employees plus customers, contractors and the employees’ family members brainstormed ideas around the future of business and the world supported by videos and background information on some of its most intriguing technologies. So the values are deeply embedded in the organisation.

Ethan explained that he can’t measure the success of blogging but he does track anecdotes and there are examples of where blog posts led to adding value to customers.

Employee Communciation Summit

I’m attending Simply Communicate’s Employee Communcation Summit today and tomorrow.

It’s an interesting conference, and I sort of wish I’d decided to live blog it (when I’ve done this before, at last year’s CIPD conference, I’ve found it very valuable to my learning as it forces me to internalise each presentation and articulate my perspective on the topic that’s been presented).

I’m not live blogging this conference however, possibly because I’ve got lazy, but also because I don’t find I’m yet as clear in my own thinking on communication and web 2.0 as I am on HR.

However, I am tweating on it, and here are a couple of other thoughts on some of my main reflections so far (I’ll do a couple of more substantive posts later on).

Firstly, there’s a big focus on web 2.0 in the presentations – so for example, I’m currently listening to one on Microsoft’s Academy Mobile (described as an internal you tube).

But there seems to be less familiarity of web 2.0 in the audience. I think only Krishna De and I are blogging (she is live blogging). And judging by the last question (upon hearing that Microsoft don’t moderate people’s podcasts: “But that means they can post anything!”) - Steve Crecenzo’s point that now we can only facilitate not control the conversation about our organisations doesn’t seem to have hit home.

I’d sort of expected a communication conference to be quiet different to an HR one (in the UK at least I know that most HR attendees are probably never going to have even visited a blog) – audience tweats up behind the presenter and that sort of thing.

We are using Crystal Response systems for asking questions, voting and providing inputs, but in the main, the style of delivery is still very much 1.0.