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Social Media and the Supply Chain, Part 2

September 13, 2012


In yesterday’s post, I discussed the views of three supply chain analysts regarding the impact that social media capabilities can have on a business. Those analysts were Adrian Gonzalez [“Is Social Media in Supply Chain Management a Waste of Time? Logistics Viewpoints, 12 October 2011], Atin Bhola [“Supply Chain Collaboration and Social Media,” Supply Chain Management, 5 September 2012], and Trevor Miles [“Engagement Platforms need Responsibilities,” The 21st Century Supply Chain, 30 August 2012]. These analysts agree that social media can have a significant impact on businesses beyond engagements with consumers. In fact, Trevor Miles notes that when these capabilities are fully implemented they are better described as “engagement platforms” than social media outlets.


Steve Nicholls, an international speaker and social media strategist, agrees with the analysts and writes that the time has come for companies to “embrace the four business benefits of social networks.” [“Rethink ‘Social’ for Your Supply Chain,” Supply & Demand Chain Executive, 8 August 2012] The four benefits of social networks, as depicted in the attached graphic, are improved collective intelligence, collaboration, communication, and communities.




Nicholls discusses each of these “four main cost-effective business opportunities” in turn beginning with collaboration. He writes:

“At the very core of the ‘supply chain’ is the concept of collaboration. The supply chain is, by definition, a set of companies or individuals that work together to create and deliver a product along its many processes from the supplier to the customer. Social media increases the potential for collaboration vastly through a plethora of network tools. And for businesses with offices scattered all across the globe, social media platforms can serve as a potential environment to enhance communication not only internally — such as within a factory or a warehouse — but with other key industry players. Companies in the supply chain can create their own community or communities in order to develop a more cohesive work process, or participate in external ones as well in order to find out more about certain aspects of supply chain operations.”

Nicholls goes to discuss how “project and team tools like Zoho” can “facilitate collaboration through a range of useful online applications such as invoicing, information management or Web conferencing.” He believes that services like Twitter can help employees share “information within a community” so that “a business get up to speed instantly with the latest news.” He concludes, “More effective partnerships created via collaborative platforms can lead towards increased supply chain productivity of its diverse operations.” He next looks at the benefits of collective intelligence. He writes:

“Problems are bound to happen and social media allows companies in the supply chain to detect them quickly, efficiently and find solutions. Useful, user-generated feedback can be turned into business intelligence for companies’ own benefit. Discussion boards, surveys, rating systems, recommendation systems and idea platforms can all be used by a company to provide and share feedback between each other and thus highlight potential problems. These sites can also be used to track the progress of one activity for instance, or channel targeted feedback about specific topics or operations. This process not only allows participants to voice their thoughts easily, instantly and from any geographical point, but enables companies to gather extremely valuable information to improve operations and find new ideas.”

Nicholls notes that social media allows companies to reach more people “regardless of geography or time zones. He concludes, “Highlighting problems, finding solutions and bringing in new ideas altogether leads towards better productivity in the long-run and creates a more profitable business for everyone involved in the supply chain.” When it comes to highlighting problems, most companies are well aware of the impact that consumers can have on a company’s reputation; which is why they have primarily focused on the business-to-consumer side of social media. Supply chain analyst Lora Cecere has written, “Social [media] should not be about social for the sake of social. It is not about ‘fans.’ It is not about the number of ‘likes.’ It should not be contained in marketing. It should not be outsourced to a PR firm. It should not be based on first generation analytics. Instead it should be seen as a way to have a relationship with the customer. This can only happen if there is an understanding of the basics. It is about story telling, building excitement and delivering relevance.” [“A New Technology that should Push Your Buttons,” Supply Chain Shaman, 19 January 2012]


However, as I noted in yesterday’s post, Trevor Miles believes the real impact of social media platforms won’t be felt unless messages sent via them are targeted rather than broadcast. Miles writes that engagement platforms must be connected in “a responsibility network. In business, specific people need to act, so messages/alerts need to be directed, not broadcast to everyone.” He adds, “Secondarily there is the need to separate the urgent from the important, to increase the signal to noise ratio. In other words, there is the need to be able to evaluate the business impact of a piece of information.” Moving on, Nicholls concludes his discussion with a few thoughts about communications and communities. He writes:

“With social platforms, the supply chain can enhance communication, create communities, improve collaboration and collect useful information. The key for businesses, however, is to choose the optimal blend of social media applications that will answer specific business goals. Adopting social media to particular business needs will be the core of a successful social media strategy.”

In a follow-up blog to the one cited earlier, Adrian Gonzalez wrote, “Many executives are saying is, ‘We know social media will transform supply chain processes, we just don’t know how exactly, and where to start and why.'” [“Supply Chain Executives Define Social Media Too Narrowly,” Logistics Viewpoints, 16 November 2011] He continued:

“Two issues … are contributing to the problem: executives define social media too narrowly and they focus too much on the technology (and are scared off by all the buzzwords) instead of focusing on the opportunities to improve business processes.”

Gonzalez believes that “in order to determine where to start with social media and develop a clear business case, supply chain executives will need to … Think Beyond Facebook, Twitter, and LinkedIn [and] … Focus on the work, not the words.” Concerning the first topic, Gonzalez writes:

“For most executives, and the public in general, the term ‘social media’ basically equates to Facebook, Twitter, LinkedIn, and other publicly accessible sites. But the ecosystem of ‘social networking’ solutions also includes ‘Enterprise 2.0’ applications (aka ‘Enterprise Social Software’) that companies can deploy internally to facilitate communication and collaboration between employees and different functional groups, and with suppliers, customers, and other external partners in a private, secure environment.”

Concerning the second topic (i.e., focusing on the work, not the words), Gonzalez writes:

“In her book The Plugged-In Manager, Terri Griffith highlights a conversation she had with Stewart Mader, author of the book Wikipatterns. She asked Mader how he talks about Enterprise 2.0 to people and here is part of his response:

People are so caught up in ideological arguments about what [social media technology] should be called. All are weak…What I find useless about the whole [Enterprise 2.0 terminology] is that when you create a new term for something, you create a distinction that makes the casual observer think it’s totally different … When people get caught up in the terminology, they lose focus on the part that’s the same [the work that needs to get done] … Slows down implementation as they think it’s about adoption. But in reality in an organization, you want people to get work done, first and foremost. If you create a divide, Enterprise 1.0, 1.5 … you have people thinking that they need to do additional work to drive adoption of each “new” thing.

“In other words, many executives get caught up in the terminology (blogs, wikis, tweets, discussion forums, RSS, Enterprise 2.0, etc.) and view social media as more work to do, more information they need to sift through in addition to emails and voicemails, instead of taking a step back and thinking through the work they and their colleagues need to get done, and then determining how these tools can help them achieve their objectives in a more productive and effective manner — and in many cases replace (not add to) existing tools and practices, such as sending emails and attachments back and forth or scheduling a bunch of conference calls where nothing gets documented afterwards.”

With Facebook’s stock price dropping like a man in a barrel going over Niagara Falls, it’s easy to be skeptical about social media. The fact of the matter is, however, that nearly a billion people signed up for Facebook because they understand its power and potential. Twitter was also received skeptically but it has grown to become a household name and has had significant social impact. But I agree with the analysts identified at the beginning of this post that the time has come for companies to embrace business-to-business opportunities presented by engagement platforms as well as business-to-consumer opportunities inherent in social media platforms. By viewing them as engagement platforms, executives should be able to get past their “social” aspects and focus on the work they can help make more effective.

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