How B2B firms can reduce their cost of sales 30-50% by using social platforms
Based on CSRA’s recent research as well as my 25 years’ experience with guiding B2Bs’ adoption of disruptive technology, I predict that 2012 will see significant social business takeup among B2B pioneers. First, a critical mass of B2B executive leaders are familiar enough with social technologies to consider them for the first time. Second, the business driver will be the economy. During the past 4-5 years, enterprises have continue to cut costs wherever they could, but few are performing at the level they want to be. B2B sales and marketing are under more pressure to perform very efficiently than ever, and some leaders will enlist social business because they have tried everything else.
Although I have served numerous B2C enterprises, I have a more profound understanding of B2B because my businesses and employers have sold to businesses. Web 1.0 (“The Internet”) adoption is a very useful pattern for understanding Web 3.0 adoption (we’re way past Web 2.0 now). For brevity, I’ll use it, along with some other patterns, to explain why my crystal ball says that 2012 will see serious B2B adoption of social business.
- Adoption of disruptive technology begins with consumers because their cost of trying new things is far lower than businesses’. In addition, families, since they include people of all ages, are hotbeds of disruptive technology adoption. What’s better than confounding parents by doing marvelous things that they don’t understand?
- B2B executive parents, being upstanding responsible adults, always reject such frivolities at first; however, they cannot stop themselves from peering over their kids’ shoulders. When a situation occurs in which the disruptive innovation adds surprising value, their attitudes begin to change. They start experimenting (what’s the No. 1 reason execs joined Facebook?), but since they have preconceived notions about how things should work, the learning process is slow. But they eventually learn to adopt the disruption in their personal lives.
- Once executives get comfortable enough with the disruption, the adventurous portion of them starts taking its disruption-enabled “approaches” to doing things to work. Experimentation continues for a while, during which the disruption is a “nice to have” option. In some cases a situation develops in which the innovation adds surprising value in the work context, which drives adoption further.
- Social business — applying social technologies to evolve business processes — is reaching this point. Another Web 1.0 lesson is that the early 2000s’ bad economy helped Internet adoption after the meltdown. Although most executives were too ready to dismiss “the Internet” as a fad, enough of them persisted and proved the value in increasing areas of business.
- At PricewaterhouseCoopers, I helped B2Bs apply Internet applications to their business processes. Once they dropped the assumption that the Internet was about Pets.com and money-losing online bookstores, they could start thinking about how they could save serious money by empowering stakeholders with real-time information and the ability to transact with their enterprise systems.