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December 28 2011 Posted by: Mark Fidelman in: Enterprise 2.0

5 Reasons Why CapGemini Just Re-Positioned their Management Consulting Practice to Focus on Social Business

Don’t believe the world’s businesses are going social?  Take this recent declaration from CapGemini’s Managing Director, Global Head of Practices, Didier Bonnet when discussing Social Business with me: “We’ve actually repositioned the entire practice around digital transformation. So for us it’s not just changing one service offering; it’s our entire focus globally for our teams to deliver and to sell.” He came to that crucial decision after MIT and CapGemini interviewed over 160 executives throughout Asia, Europe and North America and discovered that businesses are digitizing. 

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CapGemini’s decision was further supported by Andy McAfee, MIT’s Principal Research Scientist for Digital Business, view that, “analog companies eventually are going to get swept aside by digital companies. It’s my firmest belief about the future of business.”

While Bonnet and McAfee are careful to avoid the S-word, “social” in our discussions because for most executives it still equates to happy hour, social technologies are an important aspect of their research.  Bonnet explains, “it’s becoming a powerful and common word so we’re not fighting it anymore.” Indeed, executives are still terrified of their employees wasting time on social activities, but the visionaries are embracing social as a competitive differentiator.

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Here are 5 major reasons why:

#1  The Company’s Innovation Culture is Weak

Does your product or service trigger a yawn or a smile? Are you producing products that quickly resonate with your target market?  Do you have a list of hundreds or better thousands of customers that will buy anything you create?  Instead of expensive and generally worthless focus groups, a true Social Business provides a digital platform for employees, partners, suppliers and customers to give input on new and existing products. 

#2 The Competition has a Rich, Vibrant Community of Customers – Some of them Yours

We are present again at one of these significant turning points in communication – just like how the telephone revolution, email revolution, and internet revolution helped business better communicate with their customers. But now the revolution is about building online communities to connect with customers to foster loyalty, trust and engagement.  Those companies ignoring communities will soon find their customers moving to better neighborhoods. 

#3 Increasingly, Consumers are Engaging Brands with Mobile Devices

“We saw two companies in the same sector – insurance in this case – create mobile applications but with two completely different outcomes. The first company tried to simply replicate information found on their website. But the other company took an end-to-end approach and was able to get their prospect to sign a contract on the spot because he had access to all the back office information,” said McAfee giving just one example of how mobile is a competitive differentiator.

Companies will need to quickly adopt a mobile strategy that fits their own set of business use cases in order to keep up with how customers are making purchases. 

#4 Integrating Digital Information is Allowing Companies to Gain Global Synergies While Remaining Locally Responsive.

‘”We saw some really good examples of people in hotels and entertainment companies, for instance, where they integrated customer data from their CRM system, with data from social media, with location based mobile data to start recommending offers,” McAfee explained to me when referring to a best-in-class example of how companies can integrate data for increased sales.

I’ve been struck by how few companies understand the power of integrating data on a single technology platform.  We’ve all experienced a customer service call where we have to dial in our personal information only to have the data disappear once a live agent jumps on the phone.  This is but a small example of the overall problem that most companies have.  The role of the digital leader is to now meld all of the bits of information they have about their customers and to create better experiences and sales opportunities. 

#5 Companies Need a Social Business platform for a Common View of Customers and Products

The MIT and CapGemini report states that: “The most fundamental technology need for digital transformation is a digital platform of integrated data and processes. Large successful companies often operate in silos, each with their own systems, data definitions, and business processes. Generating a common view of customers or products can be very difficult. Without the common view, advanced approaches to customer engagement or process optimization cannot occur.”

For me, the big takeaway from the report can be summed up as follows.  While social interactions are fundamentally a human function, organizations need a digital platform (like SharePoint, Salesforce.com, Yammer, SocialText or Jive) to facilitate social interactions on a global scale. Here as Peter Drucker liked to say, “neither technology or people determines the other, but each shapes the other.”

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For our purposes, the technology enables the social interaction, but the social interaction shapes how the technology is used.  Each feed off each other until the organization becomes more effective. 

But why haven’t more companies jumped on the social bandwagon? According to Bonnet: “One of the key findings in the study was that one of the main barriers to achieving a successful social transformation – 77% of the time was lack of skills. Lack of social media skills, advanced mobility application skills and so on and so forth.”

Still, one-third of the companies they surveyed have an effective digital transformation program in place.  The other two-thirds need to quickly get their act together or risk falling behind. Perhaps this is why CapGemini is one of the first top tier consulting firms to change course and build a social business practice.  Indeed, who could blame them?

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