Social – An Enterprise Overlay, or an Enterprise Fabric?

On a recent trip to San Francisco I spent talking with both salesforce and NetSuite people about their approach and general view of “social” as it relates to enterprise software [Disclosure: NetSuite funded my travel and accommodation to attend and salesforce has funded my travel to DreamForce previously]. I call out these two vendors because while both are cloud-centric enterprise software companies, they have very different views on social. In fact, salesforce and NetSuite share much more than just a market focus – they’re both founded by Oracle alums, they’re both trying to re-invent enterprise software (salesforce from a CRM-centric perspective, NetSuite from an ERP-centric one), they’re both trying to branch into a more platform focused model (force.com vs SuiteCloud) and are both doing so by leveraging traditional channel-type sales models.

All these similarities (heck, they’re even a very similar age) makes their different perspectives on social all the more interesting. Let’s look at each one in turn.

NetSuite – Social is an Overlay

NetSuite’s approach towards social sees it consider social yet another channel alongside more traditional ones. Last year at SuiteWorld it announced SuiteSocial, an integration and partnership with Yammer but, interestingly enough, at this year’s SuiteWorld event this partnership was given almost no air time. This speaks to NetSuite’s perspective that social, is yet another channel alongside email – there was no particular mention of email at the event, and so too should social just be seen as a bucket where communications can happen.

Interestingly at SuiteWorld NetSuite announced an upcoming integration with content collaboration company Box. This integration will see content items able to be associated with particular customers or activities within NetSuite.

Salesforce – Social is a Fabric

Salesforce on the other hand has a very different perspective on social. it considers social to be a core fabric upon which an organization is built. Everything they do is an attempt to further this aim and hence we see Chatter, salesforce’s social tool, integrated into workflows across the organization. Alongside this Chatter is seen as a tool which replaces most or all other communication silos – recent announcements around real time, presence, group and individual messaging and screen sharing speak to this fact. Social is a core component rather than something bolted on.

Salesforce CEO Marc Benioff has been beating this drum for a few years now – his proclamation that the “social enterprise” is coming makes for great copy, and an exciting keynote, if nothing else. That said, at DreamForce last year the CEO of Burberry was on stage talking about how social is changing the way her organization works.

Who is Right?

It was interesting talking to NetSuite customers at SuiteWorld. I took part in a roundtable discussion with some Australian customers of NetSuite, When I asked them what their view of social was for the organization, their comments were fascinating. Peter Maccauley from Kitchenware direct told me that for his organization, social has no strong use case but that, were it to arise he’d be happy to look at what it meant for him. Vivien Power from Choice in Australia felt that social may have some validity as a channel to engage with customers, and that this was something her organization was starting to explore, but that it had no real validity as an internal tool.

These comments speak to the reality for enterprises, a reality that is strongly influencing NetSuite view around social. Despite assertion of the rise of the social enterprise – the fact is that social as an internal tool is at best only being used by a very small proportion of workers within an organization – more often it’s not being used at all. Benioff has always been ahead of the curve and the social enterprise message is another example of this.

However what is important here isn’t where we are today, rather it’s an analysis of how enterprises are changing and what that means for these vendors in the medium term. I believe that we are seeing the convergence of a number of different trends, all of which will impact upon enterprises’ adoption of social;

  • The move to workers bringing their own device
  • The rise of social media in the home, and the fact that most employees will be using social media outside of work
  • The move to ubiquitous data access – fuelled by mobile devices and an expectation of full time immersion
  • Economic drivers which force organizations to be more flexible, nimble and proactive

Put all this together and the net result is, I believe, an environment that is ripe for the uptake of social media within enterprise. That being the case I believe adoption will be far faster than anticipated and alongside that there will be an expectation from organizations that social media is embedded across all the systems and processes the organization uses. while NetSuite’s perspective makes sense for the here and now, it seems to me that salesforce is best positioned for this coming flood of engagement.

6 Comments
  • Can you elaborate on that “by leveraging traditional channel-type sales models” comment about Netsuite? What are these channels and/or sales models?
    Thanks, great article. Great insight!

  • Comment #2:
    I believe that the difference in approach of these 2 companies is also largely due to the very essence of the systems they build: In an CRM type of application I would expect larger “dosage” of “social/collaboration/time-line/video/etc.” kind of functionality; exactly because it is in the essence of the job and in the spirit of the people that are doing it (CRM=sales, marketing, loyalty etc., while ERP=accounting, warehouse, inventories, orders etc.)

  • [Disclosure: I am GM APAC for Yammer]

    Ben,

    Three observations relating to trends, ‘social’ and business models:

    1) An additional trend we see is perhaps spawned from combining BYOD and the upsurge of private social media use:

    I see the consumerization of enterprise software becoming more prevalent, whereby individuals are bringing their own applications to the workplace to meet specific needs. This may be constrained to something simple like a screen grabber, or more substantial such as in the case of collaboration needs.

    2) I am seeing a rapid uptake in the adoption of social media within the enterprise, which is being driven by the recognition that in order to thrive, modern organisations need to structure for adaptability in times of uncertainty. This is predicated upon having enterprise-wide transparency and a culture that supports and rewards contribution to identifying opportunities and solving problems.

    3) Voluntary adoption as enabled by freemium truly has turned enterprise software distribution on its head. Coming from a CRM background I know that adoption is the number 1 concern for most CIOs and LOB managers when deploying new applications.

    The freemium model de-risks application selection and identifies areas of user need through watching what employees are bringing and spreading within the workplace.

    My feeling is that in a startlingly short period of time enterprise social networks will be accepted as core to an organisation’s infrastructure, and it is not going to be a module with any other application, rather a layer across all business activity streams, content and conversations.

  • I see both perspectives and believe that it all depends on the type of organization. Some organizations need social, while others need structure and collaboration. However, the way the world as a whole is moving, there is no denying that social will soon be a part of every organization.

  • Agree with your conclusion, and you’re being diplomatic :)

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