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Sunday, May 23, 2010

Are Social Networks The Next Big Thing in HR? Or just another tech bubble in the making?

It seems that unless you tweet and have followers or fans or friends in  MySpace, Orkut, LinkedIn, Viadeo etc. you just don't exist. Really? Or is this just the latest fad not worth wasting much time on? To answer these questions, it's worth remembering that many technologies originated in the consumer world before being ado(a)pted in the business arena. Just think of the internet itself  or smart phones  where the initial enthusiasm by consumers were met by frosty skepticism from the business world which then went on to become avid users of the same tools. Will the same happen with social networks such as Facebook, or microblogs such as Twitter that are all the rage outside the business world -but often during business hours to the chagrin of many HR heads? Or will they just peter off  like the unlamented Second Life? (Anybody remember those corporate avatars that were supposed to revolutionize everything from performance evaluation to training to recruiting?)

Based on what I hear and see from many customers, even here in Spain (not the most forward-thinking place you might think, but remember that it's here that one of the most innovative HR products, Meta4, was born) it seems that the question should be asked in the present tense: social networks (SN's) are already part and parcel of the business world, with HR applications found and evolving on a daily basis. Just to take one example, I know many people that spend more time communicating through SN's than good old email. LinkedIn (claiming over 50 million users), of which so many of us professionals make a copious use of to share information in a push fashion, is a much more efficient way to update your network on, say, a project you are working on than through a traditional email blitz, if only because you'll never have 50 million contacts in your email address book.

One concern that I hear from CIO's and heads of HR is that social nEtworking will lead to nOtworking with employees spending much of their working time updating their personal profiles and chatting with their friends. This is exactly the same argument I heard at the turn of the millennium when the new generation of HR systems came onto the market and could be accessed by a browser, especially the self-service components. Allowing employees access to the internet in order to access these applications meant they could also surf the internet and spend their time on personal email, when not on porn sites. The horror, heads of HR used to cry, refusing any internet access. To which I countered, "well, if you're afraid that your employees may use any opportunity not to do any work, you might as well get rid of the water cooler where they could hang around and chat, and you should also board up all windows lest your employees waste time looking at the traffic outside instead of working." Needless to say that I won the argument over the reluctant companies and the same argument can be used today. I would even go further and say that that famous expression of "empowering the employee" so much touted and so little used in practice, could actually be made more meaningful. Just as with your children, trust your employee to be responsible and they might behave responsibly.

So, what are some of the benefits that SN's can bring to business, in particular the HR world?

Branding: just as the first companies that adopted websites (yes, there was a time not so long ago when some  well-known corporate entities didn't have an internet presence) benefited from an aura of tech-savvy modernity which made them popular with young graduates, the same holds true with employers who use Facebook or Twitter. It gives them a street credibility that traditional media cannot easily provide. Photos, videos, forums, all contribute to creating a feel for what it is like working for a particular company.

Recruiting: again, just as the internet thoroughly revolutionized the recruitment process with most ads migrating from print media to corporate career websites and the likes of Monster, corporate Facebook accounts help companies reach millions of "fans" with job ads as well as tap into an ever-larger pool of passive applicants (Facebook claims over half a billion visitors, equivalent to being the 3rd largest country on earth) It is estimated that by next year at least one out of 10 jobs will come from SN's and already in the US close to half of proespective employers look for detailed information about their candidates on SN's.  Every day thousands of ads are posted on LinkedIn in forums which allow fine-grain targeting almost impossible to dream of in any other media, nor even online job boards: since people visit SN's more frequently than their disparate profiles on several job boards (when they have them there), their SN profiles are updated more frequently. Also, because SN's, especially the professional ones, are richer in features, recruiters can get a good idea about a candidate without having to examine thir résumé in detail. Twitter and its real-time nature can make posting job vacancies and applying to them literally a matter of a few seconds. A recruiter at Yahoo (who has a presence on Facebook "Yahoo-Europe-Jobs" for instance) told me the other day how they posted a position on Twitter and one of their 400 followers replied and it was a perfect fit. Once the sourcing is done via these 2.0 tools the more traditional process can resume. Never has the recruiting cycle been shortened so fast to reach so many. I believe that as far as recuiting is concerned, we have reached "the end of history" to use Fukuyama's famous phrase since it is hard to envisage any other technology that would shorten the process further. Finally,  by cutting the middlemen, employers can reduce the cost of recruiting by cutting on headhunters' fees: an increasing number of  jobs are actually never advertised anywhere else but on SN's,

Collaboration and virtual teams: as the world economy becomes more integrated, the risk is all too real of global corporate behemoths turning into clusters of regional or even local work groups where information is hoarded and efforts are endlessly duplicated. SN's allow such employees to collaborate in ways that email and static document-sharing tools (such as SharePoint) could never do. When a particular product or service wins kudos in, say Latin America, but managers in Europe or Asia aren't aware of it, they tend to try several times expending valuable resources, time and energy before duplicating it with resulting profit losses. Also, and probably as important, is the ability to make faceless corporations appear more human and, among other consequence, encourage inter-group mobility. An employee in the US would be encouraged to apply for a job in, say, Brazil if they already know their future manager and have collaborated with them on some projects.

Career management: one of the major failings of HR systems is that creating a career path to be offered to an employee was always prospective: "based on your experience, skills and wishes you could move from position X to Y to Z in so many years."  As we know, the future has the unpleasant habit of never happening the way it was planned and many of those career plans built at great pains remain largely theoretical. A tool like LinkedIn or Viadeo which holds data on millions of professionals can aggregate data it holds to show the actual paths offered to certain professions. For example, in order to become a senior product manager with a software vendor, you need to be a consultant for a couple of years, then a presales person or marketing manager before reaching your goal. Since this is based on reality, it is a much more useful tool to employees and employers on whom it serves as a healthy sanity check, than any of the other prospective career paths.

Like all new technologies, SN's have their detractors who tend to over-emphasize the following issues:

- What about privacy issues and confidential data? Actually these are two separate issues as privacy deals more with the employee and confidentiality with the employer. Most SN's, especially the private ones such as Facebook, allow privacy settings that can restrict the amount of information to be shared. Of course, users have to be aware that the default settings are usually the least restrictive ones. And the more garrulous they are, the more informed corporate recruiters will be. As in many other instances of life, somebody's poison is someone else's food.  Concerning the confidentiality of corporate data, there is little doubt that the more opportunities there are to share info the more risks there are for some undesirable leaks to happen. But here again, nothing that good discipline, clear messages and responsible employees cannot fix. And of course, if you're worried that some unethical behavior will out, well, just make sure that unethical behavior doesn't happen in the first place before shooting the messenger.  The best way to avoid that the world hears about your shenanigans is simply not to have any.

- Private or public SN's? Some of the confidentiality issues can also be fixed by having an SN within the corporate firewall, just the way intranets came about. Actually the better tools you offer your employees, the less likely they are to go outside. This being said, a mix of the two is possible with private SN's used for certain functions (e.g., recruiting) while career paths and collaboration will be mainly carried out through corporate SN.

- Another IT project to embark on? No, thanks. And anyway, why should HR own this? One answer for both: most of the data for SN's is already available in corporate IT systems, mainly from HR systems (members' names, careers, roles etc.) thus reducing the need for a costly implementation.

In summary, my feeling is that there are undeniably hurdles to be overcome, but they seem to me more like growing pains than serious reservations. One challenge, though, that would have to be fixed and which would  could tilt the success-or-failure balance one way or the other is the existence of tangible benefits that SN's bring. I've seen some SN's, especially private ones (that is, within the corporate firewall) where the communities of members are no more than glorified email-based distribution lists or document-sharing tools. In that case one could just rely on the older technology and save one's time, energy and resources in the implementation of the newer system whose return on investment is so limited. So far, I'd say that the jury's still out but the outlook is promising. Who knows? SN's could be the last opportunity for HR to show a lasting relevance before it slides into irreversible oblivion replaced by other business function and outsourcing outfits.

(I prefer the term Social Networks to Social Media, as the former emphasizes the holy grail of effective collaboration, sought for so long and rarely attained, whereas the latter seems to suggest a one-way communication tool)

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