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Executives of Fortune 1000 companies involved in customer care say they think social media is a "critical tool," according to a survey out this week. But, says that same survey, the execs haven't figured out yet how to "leverage the increasing influence" of social media in a way that benefits their business. But the surveyed execs are joined by most of the rest of Earth, where we haven't quite figured out how to turn friending or blogging into an enterprise advantage.
There's the idea of tweeting to head off an impending p.r. disaster or to routinely engage with customers, and there's even the idea of paying Lindsay Lohan to craft those tweets. But no one has yet quantified the effect on the bottom line.
But today I listened to an exec from a pharmaceutical company talk about how his company is using a form of social media to improve the business. Tony Martins, supply chain VP for Teva Pharmaceuticals, described how his firm is leveraging "enterprise social software" to be more responsive to crises. Teva is in the generic drugs business, and from the way Martins described it, crises are a regular part of the business. "The main driver of our business is drug shortages, the gap between supply and demand. It's a dramatic situation," he says.
Since you can't just whip out a batch of medicine — the supply chain is long and made up of many links — operating on the usual schedule of six months doesn't cut it in a crisis situation. You need a supply chain of rapid response, Martins says. "The traditional supply chain is really a collection of systems talking to systems. Instead of having systems talk to systems, you need people talking to people," he says. "People have the capacity to respond immediately to a situation."
So, Martins devised a system based on the concept of spontaneous association — which he defines as "the capacity that a group of individuals has to combine their skills to respond to a problem, without being directed."
Spontaneous association is essentially what happens in social media environments, isn't it?
Martins set up a virtual space where Teva employees and colleagues from other parts of the supply chain could meet to discuss problems and collectively figure out solutions. "We share a federated common space... boundaries disappear.... It's great for reacting to a surprise jump in demand for a particular product. Normally we would have to cut through layers of the supply chain, like planning and then manufacturing," Martins said.
The spontaneous association approach not only tears down the physical walls between business partners, it also tears down the traditional top-down hierarchy that Martins appears to be no big fan of.
"This way, you can get more individuals in more geographies involved in a problem," he says, rather than relying on the chief problem solver to get a chance to come up with a resolution.
"Using this shared space, everyone working in the same virtual environment, when an event occurs, everyone sees it at the same time. Our commercial people, operations people, manufacturing, suppliers, shipping, they all see the event at the same time, and can then collaborate to determine how to cope with it," he said. Martins added that this more social approach can save as much as 40% in response time.
Many small software teams in the Nearshore region are already having success using some form of spontaneous association, even if it's an ad hoc kludge. The associative, social approach offers a model that companies using old-school development practices would do well to take a look at.
But keep in mind one other thing Martins mentioned: If you try to implement the kind of system they've adopted at Teva, you might run into opposition. Some managers don't like doing things in a new way, some might feel like their role in the decision process is threatened. But there was once opposition to using e-mail and the Internet in the workplace too.