Organisational Value of Social Technologies: An Australian Study

Abstract

This paper discusses the value of social technologies in organizations. It is based on 'value focused thinking' approach to establish the fundamental objectives of social technology applications in organizations. Data for the study was gathered from interviews with 26 individuals in 10 organizations about the value of social technologies. Value focused thinking approach helped structure the interview responses to establish value of social technology in terms of business improvements. The findings highlight innovation of internal processes, creation of organisational identity and new business models, integrated business functions, as well as employee support to be important values of social technology enabled innovation in organisations. Other values include low cost interactive marketing, dissemination of a large amount of information, organizational transparency and better customer service. This research suggests social technology values are achieved from both internal as well as external applications.

Headnote

Abstract: This paper discusses the value of social technologies in organizations. It is based on 'value focused thinking' approach to establish the fundamental objectives of social technology applications in organizations. Data for the study was gathered from interviews with 26 individuals in 10 organizations about the value of social technologies. Value focused thinking approach helped structure the interview responses to establish value of social technology in terms of business improvements. The findings highlight innovation of internal processes, creation of organisational identity and new business models, integrated business functions, as well as employee support to be important values of social technology enabled innovation in organisations. Other values include low cost interactive marketing, dissemination of a large amount of information, , organizational transparency and better customer service. This research suggests social technology values are achieved from both internal as well as external applications.

Keywords: organizational value of social websites, social technologies, value focused thinking approach, organisational value of Web 2.0 technologies

1. Introduction

Web 2.0 based social technologies including blogs, wikis, YouTube, MySpace, Flickr, Twitter and Facebook evolved in the last decade, and are being extensively used by individuals (Treese, 2006), government agencies (Osimi, 2008) and by organisations across a multitude of industry sectors such as health, education, retail, and transport (Boulos and Wheelert, 2007; McAfee, 2006). Organisational applications of social technologies support novel ways of interacting with customers and new business opportunities (Boulos and Wheelar, 2007), team work (Jue et al, 2010) and a greater interaction with stakeholders (Constanides and Fountain, 2008). An exploratory Australian study (Singh, and Davison and Wickramasinghe, 2010) highlighted that for business organisations social technologies are a major innovation in managing relationships with their stakeholders, and for collaborating and networking with business partners. Social technologies are replacing complex knowledge management systems in organisations with 'blogs' and 'wikis' for knowledge sharing and transfer (Lee and Lee, 2006) and are providing organisations with low-cost, low-risk marketing channels (Forrester Marketing Forum, 2009).

The motivation for this study arose from the increased adoption of social technologies by organisations (Forrester, 2009) and the focus of earlier research on social technologies being only on specific applications of social technologies. These include studies on taxonomy (Kim et al., 2010), definition, history and scholarship (Boyd, 2007) risk, trust and privacy concerns (Fogel and Nehmad, 2009), changes in user behaviour (Patchin and Hinduja, 2010), and self disclosure (Posey et al., 2010). Business related research on social technologies include social technology based dynamic capabilities (Singh et al 2010), features of enterprise 2.0 (Bughin, 2008 and McAfee, 2009), an analysis of literature on social technology impact (Sena, 2009) and business impact of Web 2.0 technologies (Andriole, 2010). Keitzman, et al., (2010) addressed social media applications in organisations from the perspective of how individuals in the organization use these tools. Turban, et. al (2011) established a framework for recognising social technology opportunities, adoption and risk mitigation, Wu (2013) explored social network effect on productivity and job security, Goh et al (2013) established the impact of market generated content on consumers, Haefliger et al (2011) explored social software interactions strategies, and Aral et al (2013) focused on a framework for research on social media related business transformation. Whilst these earlier studies discuss valuable insights on one or more specific aspects of social technology application in business, comprehensive studies determining the value of social media in organisations are sparse. Value of social technologies in terms of organisations deploying these technologies for achieving business efficiencies is yet to be determined. This paper begins to fill the void by investigating the value of social technologies in ten large Australian organizations that were early adopters of this media.

This study is based on the 'value-focused thinking' (Keeny, 1992) approach to establish the value of social technologies in organisations. 'Value-Focused Thinking' approach helps establish values from the identification of objectives. Fundamental objectives refer to the objectives underlying the reason for social technology adoption, and means objectives are those whose attainment help achieve the fundamental objectives (Nah et al., 2005). Research reported in this paper indicate that social technologies support and improve marketing and customer service support; promote organizational transparency; increase stakeholder interaction; enhance employee support and augment innovation.

The paper is organized into seven sections. Following this introduction the second section discusses relevant literature on business applications of social technologies in organizations. The third section discusses earlier research on the benefits of IT in organizations. The fourth section describes the research methods adopted to estimate organizational value of social technologies. The fifth section describes how we organized social technology values from value focused thinking, and the sixth section discusses contributions, future research and limitations of this study. Concluding remarks are included in the seventh section.

2. Organisational use of social technologies

Social technology applications in organizations are generally service based, supporting user interaction, encouraging users to contribute, review and edit content due to its characteristics of easy content creation and low operation costs (Kim et al, 2010). Leonardi et al. (2013) refer to social technology in organisations as enterprise social media which supports both internal and external communication. Social technologies are used by business organizations as a marketing tool and social dissemination of news and exchange of ideas (Constantinides and Fountain, 2008; Demetrious, 2008) for collective intelligence (Chesbrough, 2006; McAfee, 2009); and knowledge networks (Jarvenpaa and Majchrzak, 2008). Turban et al. (2011) extend the use of social networking activities by organisations to information sharing, advertising, market research, recruitment, connecting employees and the alumni, and by enhancing existing platforms such as e-mail, and customer relationship management with blogs, wikis and discussion forums. Some organisations achieve this with social networking sites such as Linkedin, Second Life, Facebook, Blogs, Wikis and Discussion Forums, whereas some develop tools with social networking capabilities such as IBM's Lotus Connections and Microsoft's SharePoint.

As a marketing tool, Constantinides and Fountain (2008) and Demetrious (2008) explain that social technologies enable new forms of interaction with customers as well as explain one-to-one marketing with its characteristics of openness, participation and networks. This opinion is supported by Li and Bernoff (2008) who suggest that with social technologies organisations can gather customer likes and dislikes about products and services and push information of interest to their customers. On the other hand, Goh et al. (2013) discuss that user generated content (UGC) characteristic of social technologies are used by suppliers as market generated content (MGC), which is commonly known as persuasive advertising, and positively impacts consumer decision to purchase. They explain that both MGC with product and service information, and UGC with customer responses about products and services should be used in the right combination for marketing via social technologies. Blogs are used as a cost effective channel to promote products and services, as well as for one to one interactive marketing (Drezner & Farrell, 2004), and sharing and refining business knowledge (Soriano et al, 2009).

Bughin (2008) and McAfee (2009) publicized enterprise 2.0 as an outcome of social technologies achieved from peer to peer interactions for collective intelligence, social networks, and knowledge sharing via blogs and other customer collaboration by attracting a lot of SNS on the organsiational sites. Chesbrough (2006) further confirms that social technologies enable collective intelligence, new ways of presenting data (mashed up), is easy to use, promotes digital democracy, collaboration and development of new business models. This is re- inforced by Twentyman (2008) who extended organizational use of social media to sourcing best recruits for positions by tapping into the social networking sites, and Weil (2006) is of the opinion that enterprise 2.0 has the potential for large returns and a competitive advantage.

Leonardi et al. (2013) extend organisational applications of social technologies to external organisational communications with external parties such as customers, vendors, and the public, and explain internal applications for communication within the enterprise. Internal enterprise social media according to Leonardi et al., supports knowledge sharing by allowing all to see the content of one's message to others, and by persistence, referring to information remaining available to users and not expiring or disappearing when one logs out.

Organisational use of social technologies from the above literature discussion is summarised in Table One below:

Information presented in Table 1 indicates that in organisations social technologies are used for marketing, customer relationship management, communication, management of dynamic content, creation of knowledge networks for collective intelligence, managing people, stakeholder collaboration and the development of new models for achieving a competitive advantageAlthough social technologies have the unique characteristics of user created content, multi-platform access, transparency and synchronous as well as asynchronous communication (Kim et al, 2010), they are Internet and computer based, multiplatform and responsive, are easily integrated with different technologies, and entail data. Therefore social technologies are a type of information technology (Haefliger et al, 2011). Therefore IT value issues are discussed in the next section. Value of information technology in organisations

Information technologies are widely deployed in organisations to improve operational efficiencies and financial performance. The impact of IT on organisations can be tangible as well as intangible (Sheng et al, 2005). Tangible benefits are usually associated with improvements in financial performance such as improved marketshare (Banker and Kauffman, 1988; Barua et al, 1995), reduced labour costs (Singh and Byrne, 2005), profitability (Brown et al, 1995), cost savings (Mukhopadya et al, 1995), and improved productivity (Hitt and Brynjolfsson, 1996). Melville et al., (2004) explained that economic value is achieved from IT resources and positive financial performance, confirmed by earlier empirical studies (Devaraj and Kohli, 2000; Bhardawaj, 2000).

Intangible benefits of IT include enhanced coordination with business partners (Buhalis, 2004), higher product quality (Ryan and Harrison, 2000), improved customer service (Anderson et al., 2003), increased knowledge about customers (Cooper et al., 2000) and competitive advantage (Bhatt and Grover, 2005; Devaraj and Kohli, 2003; Griffiths and Finlay, 2004; Melville et al., 2004; Sethi and King, 1994).

The notion of performance and competitiveness achieved from information technologies has been continuously researched over the last decade. Joshi et al., (2010) referred to changed competitive landscape with continuous innovation through IT-enabled capabilities. Chi et al., (2010) identified competitive advantage through IT network structure, Chari et al., (2008) explored the impact of IT investments and diversification strategies on firm performance and Aral and Weill (2007) explained performance variations due to resource allocations.

Social technologies are a new type of information technology that organizations are increasingly adopting to improve competitiveness by forming networks to engage with customers and other stakeholders, establish customer and business trends, to monitor customer opinions and demands, and to disseminate information. Therefore the research question addressed is: Since social technologies are a new type of information technology that organisations are increasingly adopting, and they possess some unique characteristics of interactivity, transparency and openeness, what is the organisational value of these technologies?

Theoretical Underpinning

Theories according to Walsham (1995) can be used as an initial guide for designing research and data collection. Orlikowski and Robey (1991) on the hand explain that in areas where there is little or no research, a theory can be a final product. Value Focused Theory (VFT) approach has been used for studies in which reference theory was not appropriate for developing constructs ( Dhillion and Torkzadeh, 2006) or studies that were new applications of IT which could not be underpinned by an established theory. Earlier IT studies that used VFT include Internet commerce to customers (Keeney, 1999); a value focussed model for a C4 network (Davis et al., 2000); the value of mobile technologies in organisations (Nah, Siau and Sheng, 2005); the value of information systems security in organisations (Dhillon and Torkzadeh, 2006); value focussed assessment of ICT security awareness in an academic environment (Drevin, et al., 2007) and understanding the values of mobile technology in education (Sheng et al., 2010). Given our narrow understanding of social technologies in organisations, the Value Focussed Thinking approach (Keeney, 1999) helped establish the value of social technologies in organisations.

3. Research methodology

This research followed the VFT approach which helps establish what one wants to accomplish from an undertaking (fundamental objectives), and objectives (means objectives) that form a network of causal relationships from which these fundamental objectives are achieved (Careninin and Poole, 2000; Sheng, Nah and Siau, 2010).

4. Data collection and analysis

The steps followed for this VFT study entail identification of stakeholders and eliciting of values through interviews with the concerned people. This study was accomplished via interviews with people involved in social technology projects at ten Australian organizations that were early adopters of these technologies. We interviewed a total of 26 individuals in ten organizations ranging from 1 to 4 people in each organization. Keeney (1999) suggested that asking the people concerned is a good way to identify values, and Dhillon and Torkzadeh (2006) confirmed that the number of people interviewed can vary from 2 to 100. For this research, people interviewed were those that agreed to participate in this research, and were managing social technology projects in their organisations. The range of industries represented by the respondents includes IT, travel, education, automotive, retail and finance. Respondents were from teams made up of people from IT departments, marketing, accounts and social technology project leaders.

The interviews were conducted face to face using a discussion document to establish social technology values in organisations. Each interview session continued until no further values could be elicited from each respondent.Interviews were recorded and later transcribed. The researchers also took notes during each interview.

§ The means and ends objectives were derived from the interview transcripts. All subjective responses from the interviews were reduced to a common form (Miles and Huberman, 1994). The initial list was grouped together by the researchers to enable clustering of similar objectives and removal of redundancies and duplicates. The statements were then written in a common format, ie an objective or a subobjective. By carefully reviewing the content of each subobjective, 8 clusters were developed. These clusters were then labelled and are presented as means objectives (means) with evidence from interviews. This is attached as Appendix Two.The objectives were classified as either fundamental (end) in relation to the decision context or a means (ways) to achieve the fundamental objectives as shown in the means-ends objective network (Figure 1 - Appendix One). For example, when a general objective was identified to be maximising marketing effort, using the WITI (why is that important) test (Keeney, 1999) we established the need for a social technology marketing strategy, brand promotion via social technologies, and reduced marketing costs to be means through which the end (fundamental) value, maximising marketing effort was achieved. This was combined with customer insights established from customer comments on products and customer services to establish the fundamental objective (social technology value) to be 'enhanced customer service and marketing activities'. Similarly other values presented in the means objective network (Figure One - Appendix One) were achieved. As a result, 6 fundamental objectives (social technology values) were arrived at, presented in Table 2.

5. Research results

From an initial list of 89 means objectives and 8 candidate fundamental objectives presented in Appendix Two, six fundamental objectives have been identified. These are presented in Table 2. Issues transcribed from the interviews are presented in Table 3 - Appendix 2. The means-end objective network is presented as Figure 1 in Appendix One.

6. Findings and discussion

We identified six fundamental objectives (ends) in this research using the value focused thinking approach representing organizational values (Figure 1) gained from social technologies. These are discussed in the following section in light of the existing social technologies and extant theory on the benefits of information technologies for organizations.

6.1 Enhanced customer service and marketing activities

This research indicates that social technologies are useful tools for providing effective customer service support. It supports a greater interaction with the organization and its customers as well as connects customers to other customers. The organization is able to capture customer concerns from the social media based discussions, reviews and questions in a quick and effective way to design and deliver what customers want, improve on what customers complain about and provide assurances and relevant information to customers interactively on a one to one basis. Marketing effectiveness with product and service promotion at very low costs is achieved from social technologies. This finding confirms Cunnigham and Wilkins' (2009) suggestion that with social (Web 2.0) technologies a reduction in marketing costs is achieved. Organisations are able to promote goods and services, as well as customer experiences via YouTubes and other social networking sites. It enables inclusion of successful case files, dissemination of new product information, gauge customer opinions and incorporate customer insights for marketing campaigns. Organisations achieved greater brand recognition, and reach to new customers and customers' friends with product information confirming Edery (2006) and Hemp's (2006) theory that Web 2.0 enables a host of new customers on this new arena. This finding also extends Constantinides and Fountain's (2008) theory that social media is an effective marketing tool, and Bughin (2008) and McAfee's (2009) theory that it enables one-to-one interactions, and customer collaboration with market generated content (Goh et al. (2013).

6.2 Enhanced stakeholder interactivity and collaboration

With social technologies customer experience is easily consolidated from different sales people, participation from new partners is encouraged, and a better relationship with all stakeholders is maintained with the social technology characteristic of transparency and customer collaboration (Chesbrough, 2006 and Leonardi et al. (2013). New business models are generated that support a greater collaboration and interactivity with stakeholders improving business and marketshare. Participation from new partners and collaboration of different business functions was also achieved. This finding is commensurate with Constanides and Fountain (2008) and Leonardi et al's (2013) opinion that with social technologies a greater interaction with stakeholders achieved.

6.3 Corporate Identity and transparency

Although much of the extant literature emphasises on individual identity (Keitzman et al. (2011) this research highlights that organisations are able to promote corporate identity and transparency via social technologies. The unique social technology characteristics of openness, transparency and networks enable organizations to present large amounts of information (dynamic content) via this media to a much wider community promoting the organization and assuring integrity. Customers and business partners are able to monitor information on organizational blogs for example, to establish authenticity and honesty about products and services, standards used, quality of products, and other information about the organization they are dealing with. It allows organizations to present dynamic content on social technologies to promote and shape their brand as well as monitor what is being said about them. Information presented on blogs is also captured by other media such as newspapers and business magazines further promoting the organization. This research identified that social technologies proffer transparency and openness, as well as helped organizations attain identity and recognition quickly and easily.

6.4 Innovation

Social technologies helped organizations develop a new frontier for communication, interaction with stakeholders, information dissemination and provided an alternative avenue for new recruits. This new social technology culture required innovation of processes and new ways of doing things such as managing relationships with stakeholders and capturing insights from customers and business partners on a number of issues. Interaction with all stakeholders in one space without time constraints made possible by social technologies proved to be very useful for organizations. Via social technologies organisations are now managing sales information, and having discussions with sales managers from all branches. Input from people in different branches is leading to collective intelligence on marketing and sales, in the same way that input from different suppliers are leading to easier management of supply chains, Interactions with offshore partners for the management of outsourced business processes and other business partners is supporting better management of all business operations. Use of social technologies has also enhanced collaboration between business functions within the organizations supporting cross functional teams and better sharing of information. When increased communication, stronger collaborations and connections are achieved from social technologies, change in strategic and marketing plans, leadership styles and organization structure is required extending Mol and Birksahw's (2008) explanation of management innovation. This finding on innovation also confirms Chesbrough's (2006) theory that social technologies result in new business models.

6.5 Integrated business processes

Social technologies are used for information dissemination both internally and externally. Information from social technologies are loaded onto organizational databases for data mining and business intelligence on new opportunities in marketing and business growth. This research also highlighted the minimisation of ad hoc resource allocation with streamlined processes which also led to enhanced productivity. It clearly brought to light information integration for managerial and strategic decisions with data from social technologies transmitted and integrated with internal organisational processes.

Social recuitment and human resource management

Findings of this research indicate that organisations are integrating social technologies into their intranets for internal news dissemination, to enhance peer to peer interactions, and for a greater interaction between employees from different levels. Organisations are competing for key talent for which social technologies are proving to be useful to identify the best recruits for the organization. With social technologies employees feel more engaged, feel they make a difference and are recognized for their contributions. New ways of capturing pertinent information from social technologies are made available via organizational intranets leads to knowledge creation and enhanced social capital amongst employees. Whilst some of the above findings are new, knowledge networks created from social technologies for and by employees confirmed Jarvenpaa and Majchrzak's (2008) description of social technology applications for employee support. It extends Kosalge and Tole's (2010) theory that with Web 2.0, an organization can better engage with and energise employees.

Literature discussed earlier in this paper identified organizational value of social technology to be low cost marketing, customer relationship management, knowledge management, collective intelligence from team work, employee support and social recruitment, new business models, stakeholder collaboration and a competitive advantage. Findings of this exploratory research include integrated organizational processes for cross functional decisions based on information analysed from social media, stakeholder relationship management, new business models for marketing and collaboration, innovation, organizational identity promoting openness and transparency, peer to peer employee support and collaboration between employees of all levels to be organizational values attained from social media. Although knowledge management was not apparent with these early adopters of social technologies, the most important contribution this research makes is that organisational value of social technologies is realised from both internal and external applications.

Some of the organisational values of social technologies discussed above are similar to the intangible benefits achieved from IT discussed earlier in this paper. These include enhanced collaboration with stakeholders (Buhalis, 2004), improved customer service (Quinn and Bailey, 1994), and increased knowledge about customers (Cooper et al., 2000). Although evidence of competitive advantage was not clear in this research, innovation and increased knowledge capabilities (Chi et al., 2010) were definitely evident. Conclusion

Value of social technologies in organizations was established using the 'value focused assessment' theory determining the means and fundamental objectives. It provided a systematic approach for articulating and organizing means and ends (ways of achieving values). It highlighted social technology capabilities, how they can be deployed in organizations and what benefits can be achieved from them. An important contribution this research makes is that organizations can capitalize on internal values of social technologies (innovation, integrated business processes, employee engagement and support) as well as external values (enhanced stakeholder interactivity, customer service and marketing activities, corporate identity and transparency, organizational identity, business promotion, stakeholder and customer relationship management). It also confirms that social technologies are a type of information technology as much of the extant IT theory on benefits can be applied to social technology values. For organisations, this research indicates that social technologies create a network for innovative marketing opportunities, enhance collaboration, support team work and recruitment of employees, provide customer services, lead to integrated business processes and support a greater understanding of customer demands.

Based on the initial work presented in this paper, three broad categories of research opportunities exist. Therefore further research could address firstly the objectives identified in this research can be tested for organizations in different regions of Australia and the world to confirm the values discussed in this paper. Secondly, to work with these same organizations to confirm the relationship between means objectives and fundamental objectives established in this research. Thirdly, to work with organizations in greater depth to establish objectives that can be classified as tangible benefits and compare them with IT tangible benefits.

7. Limitations

Research findings discussed in this paper are from one state in Australia with organizations that are early adopters of social technologies. Some organizations were using a lot of these networking sites while others had implemented only a few. Values in this research were subjective, acquired from interviews. Quantification of the values might result in a different set of fundamental objectives.

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Appendix

(ProQuest: Appendix omitted.)