Driving Loyalty in A Virtual World: Building Participation and Harnessing Collaborative Intelligence

EFFECTIVE EXECUTIVE NOV.2009

ORGANIZATIONAL LOYALTY

Driving Loyalty in A Virtual World: Building Participation and Harnessing Collaborative Intelligence

-- Vandana Ahuja, Dr.Y Medury

The need for creating value propositions for consumers in a competitive scenario has outlined the fact that the final value delivered to the consumer is the sum of contributions of all partners across the entire value chain. This article describes ways in which the collaborative web can be used by organizations to engage partners and stakeholders.

The collaborative web or web 2.0 as it is termed has altered the manner in which information is published, consumed and utilized on the Internet resulting in several new opportunities. Online commu-nities and peer-to-peer networks have become valuable places for exchange of ideas and sharing information, thereby diminishing barriers across different geographical locations and organizational divisions by promoting collaboration and instilling a culture of sharing and cooperation across divisional silos.

The need for creating value propositions for end consumers in an increasingly competitive scenario has outlined the fact that the final value delivered to the end consumer is the sum of the contributions of all members across the entire value chain right from the organizational suppliers and employees to the marketing intermediaries. It is vital for organizations to strive to drive loyalty across all these stakeholders in the value chain. This is where the collaborative web and its offerings – corporate blogs and online communities – can come into use.

In a scenario where network effects are important whereby talented people in close proximity to each other stimulate and influence new ideas, technological developments, innovation and organizational growth, it is vital to retain these organizational partners by driving loyalty. This can be done by engaging in partner relationship management which can be done by using communities and blogs. What is needed is an open culture that values a diversity of ideas and experiences. Research has further proven that people who read organizational blogs, for instance (or participate in online communities) perceive an organization's relational maintenance strategies as higher than those who read traditional web content alone, thereby using these valuable tools for creating and maintaining value laden relationships. These are organizational efforts to develop strategies for relationship maintenance, which in turn have been found to correlate significantly with relational outcomes like trust, satisfaction, and commitment – all in turn leading to organizational loyalty.

Employees (and partners) stay with organizations when they are satisfied and perceive greater value in sticking on. This value is a function of their trust, indicating the level of credibility they associate with the organization. We focus on some areas whereby organizations can drive loyalty by making use of some features of Web 2.0.

Building credibility for the organization

Retaining partner confidence and trust in the organization is of paramount importance in a competitive era where employees have multiple options available to them. While promoting a culture of information sharing, organizations can use concepts of corporate blogs or online communities of employees and partners to promote interaction and conversation amongst the various members. By posting relevant content, firms can also use these online forums to build credibility for themselves by responding to sensitive issues or showcasing organizational achievements. By managing information appropriately, firms can build value, discuss objectives and goals, and seek employee participation by allowing two-way communication. This can enable creation of an ideal supportive climate, characterized by respect and encouragement of employee input. The first significant impact of this is communicating to the employee that they are perceived as important, while offering them an opportunity for upward communication. These online spaces can be utilized to host organizational value systems through the right organizational communication. Often used by firms to seed desired cultures and communicating organizational change, these virtual forums are also being used for socialization and fostering climates of harmony and coexistence.

Replacing the concept of `press releases' as modes of communication to stakeholders, these interactive online media form a more person-centric vehicle of communication to all investors, fund managers, customers, suppliers, shareholders and employees, especially when they represent the human face of the organization, willing to interact, respond and absorb the expectations and emotions of the involved members. As influential or senior organizational members start participating, there is an immediate surge in the credibility associated with the firm. When a senior executive talks openly, it signifies greater levels of clarity and transparency. However, what is more important is the fact that he is available for discussion. Companies which embrace the openness and transparency these channels bring, definitely enjoy a competitive edge over the rest.

All partners, employees and stakeholders, in fact all affected parties would be happy being privy to issues that impact them, be it innovative ideas, their applicability, a competitor analysis, future outlook, current issues, apprehensions, market forces, business practices or current industry orientation. These online channels offer a way to impact the expectations of the involved members by capitalizing on positive information and minimizing or mitigating the impact of negative issues. Studies have in fact shown that partners, employees and stakeholders are more loyal to companies that adopt a straightforward and transparent tone.

Employee and partner Inclusion by Encouraging Participation

These online communities and blogs can become shared workspaces where employees and other partners can log in and an exchange of ideas can take place. These ideas gradually make the online webspace a repository of knowledge capital as they combine the thoughts and thus the intelligence of the entire group. Promoting participation can usher in an era of collaboration, where learning outcomes of involved members can be enormous. As per Metcalfe's law, the value of a network or group is the summation of the individual values in the network. The community value of a network grows at a much faster rate than the individual values. Each new user benefits from joining the network/community, which gradually becomes a complete resource pool and contributes a new value-laden connection to all the existing members of the network. Network leaders can explore inputs from members on these online platforms and use their vital feedback for reformulation of strategies, reevaluation of team goals and responding to their thoughts. Agreed, that forums like these are prone to misuse by negative elements in organizations; implementing a moderated online environment can mitigate potential negative impacts.

Harnessing Collaborative Intelligence

Collaborative intelligence can be used as representing the collaborative ability of an entity or a group. To succeed, companies need to innovate faster, collaborate better, and operate more efficiently than ever before. To do so, they need to depend on close collaborative relationships with strategic partners, develop the ability to exchange prudent information rapidly, and to act on that information in real time, across end-to-end business processes. The key to unlocking this performance potential is to tap into the power of communities that drive business success. Relationships matter, particularly for knowledge intensive activities that make organizations unique. Given the increasingly dispersed, project-based work environments that are characteristic of companies today, it is important to help people become better connected – with one another and also with the information and applications they need.

Vandana Ahuja is a visiting faculty at India's Jaypee Institute of Information Technology, Noida, an educational initiative of the Jaypee Group of Companies. She was earlier a member of the IT arm of the group where she joined after brief associations with software giant NIIT and Elbee Express. She has research interests in the field of social media and its applications at the enterprise level as also the domains of marketing and CRM, and contributes actively at www.customerthink.com. Dr.Y Medury is the Chief Operating Officer (COO) of Jaypee Education System and Vice Chancellor of the Jaypee University of Information Technology, Waknaghat. He has earlier served as Chairman and Managing Director of Educational Consultants India Ltd.[Ed.CIL].

Consolidation of information

The first step towards enhancing employee productivity in an organization is providing access to vital information. Enterprises with large employee, partner, and customer bases have long known the value of knowledge stored in the databases and unstructured documents found across the organization as well as in the minds of the employees. Attempts to collect this information into knowledge management systems have been made in the past, with varying degrees of success. Web 2.0 technologies such as blogs, wikis, and enterprise search for people and data are providing a new platform for collaborating on complex and creative tasks in the organizational domains. Technological advances are simplifying online collaboration and communication. These advances are increasing productivity by helping people to easily capture, share and reuse work practices (such as project workflows) and link them to the widest possible range of supporting services (for example, instant messaging, Web conferencing and tools for team collaboration). Interactivity interfaced with technology enhances the knowledge base of the community which includes organizational employees, customers and partners; hence the content generated by the community can be harnessed for the collaborative intelligence it offers. Further, the preservation of these intangible assets can form a source of competitive advantage for a firm. This is slightly complex as they differ from normal assets in a crucial way – most of the firm's intangible assets are locked up in the brains of the employees, who come and go. Be it the Microsoft Developer Network which hosts a series of employee blogs to share tips on software, programming and solutions to programming issues or the GE research blogs, or the Sun Microsystems employee blogs, the volume of company-specific knowledge available on these online webspace is huge. Sun Microsystems CEO Jonathan Schwartz uses his blog for product announcements and discussion of new knowledge issues as part of his bid to interact with the community. Accumulation of company-specific information has also made these online webspaces virtual repositories to be tapped whenever required. The volume of knowledge that can be retrieved regarding a person's work in an organization post his departure, through his contributions to his blogs etc., makes these organizational endeavors viable. Thus, business can benefit by making optimal use of key resources by increasing operational flexibility, while employees can be empowered with access to knowledge for challenging and new assignments. After all, employees are the happiest when they get new opportunities for growth – but only if they have what they need to do their jobs effectively.

Stimulating learning

Teams of participants can be asked to share their views online and learning can be attained by each team/group member, as they start benefiting from the views of the other members of the group. The collaborative intelligence of the entire group can have substantial learning outcomes for the diverse group members, even if they are geographically apart. Encouraging participation in this interactive environment can help team leaders utilize the intellectual capital of their team members, through content aggregation, while knitting them together through better communication. Learning leads to individual growth. Employees who grow with the organization stay with the organization!

Allowing a flow of creativity

Employees tend to leave organizations when they feel stifled and there are no opportunities for utilizing their creativity. Creativity breeds innovation and these online forums, specially hosted on organizational domains are harbingers of change. They can easily act as sounding boards for new ideas where a diverse group of peers can offer invaluable insights. Soliciting feedback can help test, validate and refine individual ideas. Iterations of ideas can bounce back and forth amongst the group. While this serves as an excellent outlet for employee creativity, it may also be the seeding ground for some stupendous employee ideas. Employees whose work provides greater creative satisfaction tend to show higher degree of loyalty towards the organization.

Greater visibility and recognition

Research has proven that employee participation in online organizational endeavors is a function of their desire for greater visibility and recognition. By providing the employees a forum to showcase their talent, organizations can drive loyalty by virtue of augmenting the employee's self-concept, by allowing them to publically voice their opinion as well as share expertise. Benefits to users are social as well as informational, and connecting with a community helps them benefit emotionally in the long run, increasing employee self-worth and satisfaction. A sense of belongingness and association with other community members increases the chances of employee longevity with the organization. Employees care when they share. Organizations have to just find a way to make them feel valued and not used!

Internal Business Intelligence

The content created by the employees comprises a vast data pool for organizations which can be mined for new product ideas, employee performance management, identifying employee churn and increasing overall business efficiency.

An appropriate mechanism for knowledge discovery through datamining procedures can be implemented where the employee generated content can be routed to the appropriate business intelligence departments for suitable actioning. For instance, employees who form the consumer interfaces in the organization can be the best source of ideas leading to consumer satisfaction. For that matter, when organizations are looking for new product ideas, the first space they need to tap is the employees' cognitive space. By giving the employees an opportunity to share their thoughts, organizations, to some extent, are recognizing the value of the employee intelligence which can aid in driving employee loyalty.

Significantly, employee dissatisfaction can also be sensed through the employee generated content on forums like these. By adopting corrective measures, organizations can significantly reduce potential human resource losses.

Cross Organizational Business networks

Organizations are waking up to the need of extending business processes beyond corporate firewalls which implies inclusion of people outside the company as readily as they admit people inside the firm. IBM has taken the lead in applying the consumer-based, social networking concept to cross-organizational business networks. With IBM networking services, organizations can securely and easily tap into collective knowledge by enabling formation of fluid communities of interest. Enterprise collaboration platforms offer to employees what social networks offer to consumers – ease of use, speed and ubiquity combined with a high level of security, availability, quality of service, and reliability that enterprises require. To site an example, The Greater IBM Connection is a business social network designed to connect current and former IBMers and to enable them to connect, communicate and collaborate in a variety of new ways, by interacting via a virtual environment. Greater IBM seeks to contribute to advancing societal innovations by creating an innovation network that can orchestrate collaborative work and sharing of insights, and facilitate community-based, productive projects for social and business innovation.