by Nilofer Merchant | 2:00 PM February 20, 2013
Enterprise 2.0, Social Media, Social Business, Social Innovation, Social Era — are they all the same, or are they quite different? Do you know?
If you don’t know, you might be using the wrong term in the wrong context. Which doesn’t sound so bad, but the risk is misunderstanding, or quite possibly sounding stupid. It’s like using poor grammar; if you use “you’re” when you really mean “your,” some people are going to notice. Beyond looking silly, the much bigger risk — the risk to the business — is that when we throw terms around imprecisely, we risk introducing confusion into the strategy we’re trying to execute. So let’s try to disambiguate the terms so we all know what we’re talking about.
The term “social media” was popularized by Chris Shipley in 2004, as she described the impact of influencers and bloggers in shaping product adoption, more so than traditional media outlets. Because it includes the word media, and the genesis is marketing, most people think of this as the stuff the CMO and their team worry about. It’s like describing electricity by tying it to what came before it. Saying Social Media is like saying “electric candle.” It points to the new, but is still anchored in the old.
Andrew McAfee coined the term Enterprise 2.0 about six years ago, and the emphasis was on the on software tools and platforms that increase information flow. The idea was that if we use social tools, we would share information freely both within the organization and external marketplaces. The specific definition in his book of the same name was how “how the Web 2.0 technologies could be used on organizations’ intranet and extranets”. It’s like describing electricity by describing the wires instead of the light — it’s a technologist’s point of view.
Social Business (sometimes going by the hashtag #socbiz) was a term first created by Mohammed Yunus but more recently claimed as a popular way to describe the way companies can generate greater value for all the constituents (stakeholders, employees, customers, partners, suppliers) — the idea being to add a social overlay to the existing enterprise, and thus more meaning. This second generation of Social Business terminology was coined by the Dachis Group, a marketing organization, and specifically by Peter Kim, who consults on it. Some experts use the Social Business term as the evolution of Social Media as the same tools used for marketing efficiencies can be applied to product development, customer care, or supply chain work. Some people tie it to Michael Porter’s Shared Value concept. Sometimes people use the term Social Capitalism to get to this same idea.
And Open Innovation or Crowdsoucing are often linked to any of these three terms – enterprise 2.0, social media and social business. Organizations can use social tools to improve how others work with you to create value together.
With all of these definitions around, you might wonder why I even added to the terminology when I wrote a book and coined the term #socialera. I didn’t want to create a new term, and yet I felt that none of the terms to date capture the key shifts. The term “Social Media” is limited by its connection with marketing and communications. “Enterprise 2.0″ is too technological. And “Social Business” simply added an overlay to the existing framework rather than challenging the premise of an organization. “Social Era” then captures two distinct power shifts:
- Organizational. Connected individuals can now do what once only large centralized organizations could. This fundamentally alters the structural core and role of “the firm,” and of working people. As more and more freelancers and solopreneurs enter the market, work is increasingly freed from jobs. The shift is from “value chain” to “value flows.” (An earlier post of mine on this idea can be read here.)
- Individual. Anyone can be a game changer by using the power of their ideas. They need not first be vetted or chosen to be powerful. These largely unheard voices are essential for solving new problems, as well as for finding new solutions to old problems. Without celebrating what anyone — quite possibly everyone — can offer, people are simply cogs in a machine: dispensable and undervalued. By celebrating each person and the value only they can create, economic power is unlocked. And it’s not that everyone will, but that anyone can. (See earlier talks and posts on this idea).
Sometimes it helps to see distinctions side by side:
| Term | Origin | Implication |
| Social Media | Chris Shipley and ClueTrain Manifesto | Moving marketing from a monologue to a dialogue. |
| Enterprise 2.0 | Andrew McAfee | Tools can speed information flow and tear down siloes. |
| Social Business (1.0) | Mohammed Yunus | Make profits and meaning (at the same time). (Also referred to as Social Innovation or Social Entrepreneurship.) |
| CrowdSourcing / Open Innovation | Jeff Howe / Henry Chesborough | Leverage others to create value for you. |
| Social Business (2.0) | Peter Kim (and Dachis organization) | By being more connected, (i.e. using social tools), a company can generate greater value to all its constituents. |
| Social Era | Nilofer Merchant | Connected individuals can now do what once only large centralized organizations could do, which changes organizational structures and individual power. |
In some cases, we’re talking about tools. In others, we’re talking about how the marketplace economy changes. And, in some ways we’re talking how the organization changes. When we use the terms interchangeably, confusion is prevalent and meaning is lost. Unless you’re talking about marketing specifically, don’t use the term “Social Media.” The electric light bulb wasn’t a new kind of candle. Not to mention, CEOs and boards think of “social media” as the stuff their marketing team drives. If you are discussing ways social tools can be applied to all parts of a value chain, “social business” is probably the term you are looking for, although there’s still plenty of confusion with social enterprise. If you are describing a reconstitution of work and institutions, then use Social Era.
No term is ever complete. Each of us are building on each others’ ideas as we collectively grapple with understanding and decoding what is happening, and what we think it means. We are all seeking clarity but are limited by our own understanding, our vantage, and by, of course, the examples we witness.
But this is not about semantics. When we focus on tools alone, I think we’re making a mistake. It’s geek chic, it’s even interesting, but it’s not talking about what is possible. The bigger point is that major changes are afoot that change value creation, the meaning of work, and the structures for our institutions.
When we conflate the tools with the outcomes, I think we risk meaning and impact. When we all use more precise language, each of us will find that people understand our meaning, and more clearly see the light.
