In an interview from the summer 2011 edition of "sparks," from Catalyst Strategies, LiveWorld CEO Peter Friedman explains how "social media is transforming interactions and brands through dialogue and relationships." More highlights from Peter's interview can also be found on the LiveWorld SocialVoice blog: http://www.liveworld.com/socialvoice/2011/06/10/social-media-business-growth/

1. sparks
ideas to ignite growth
volume 4 – summer ‘11
About sparks
Catalyst Strategies seeks to be a catalyst for business growth, a spark that ignites innovation and
momentum. sparks is our Q&A series designed to fire-up ideas about growth. Each edition features
interviews with respected business leaders who share their insights and expertise on a current hot topic
related to business growth.
In this volume: social as a business growth engine
This edition explores social business strategy with three talented business leaders:
Highlights
“The core principles of social “High performing companies “Every company should be
media – dialogue and are … 57% more likely to use looking at a broader social
relationships – are the same social techniques.” business strategy.”
for consumers and “Social business … removes “Social business software
businesses.” boundaries between experts … will touch every
“[Social] isn’t just for inside and outside of a employee and be a part of
Christmas. It’s for life. It’s company.” every customer and
relationship marketing [that] - Carter partner interaction in
wants follow through.” every vertical.”
- Friedman - Tucker
About Catalyst Strategies
Catalyst Strategies identifies business growth opportunities and defines practical strategies and programs to
realize those opportunities. Working with companies in the services and technology sectors, we specialize in
growth strategy, product innovation, customer experience, and sales & marketing acceleration. Clients hire
us the first time because of our expertise, best practices, and analytical rigor. They bring us back time and
again because we catalyze decisive action that delivers tangible market results.
© Catalyst Strategies 2011 www.catalyststrategies.com |1

2. Catalyst
vol. 4 – summer ’11
sparks
ideas to ignite growth
bio
Peter founded LiveWorld in 1996 and has 27
years of experience creating and executing
mantra for ‘11 community strategies for Fortune 500
Tech-Powered Human companies. He has launched and managed
Touch multiple online services on a global scale,
always focused on bringing people together
Social is in successful collaboration.
transformative favorite catalyst Previously, Peter was the vice president and
For Peter Friedman, Putting people together – general manager of Apple Computer’s
Chairman and CEO of they accomplish things Internet/Online Services business unit. He
they couldn’t do by oversaw the creation, launch, and growth of
LiveWorld, social media
Apple’s online services including AppleLink,
is transforming themselves
eWorld, and Internet services such as Salon.
interactions and brands His responsibilities also included managing
through dialog and Business Systems Marketing and product line
relationships. management in Apple’s Macintosh division.
Q Social media is described as a strategy, a Q How are LiveWorld’s clients growing their
channel, a discipline, a set of technologies, businesses via social media?
a platform, etc. How do you define it?
A Johnson & Johnson Diabetes Institute is a
A Social is a media channel like TV or print, good example. They created a B2B community
but really it’s more. It’s a societal change that for health care providers and educators with
transforms the way business, education and the goal of engaging them in transforming
play are done because it enables people to diabetic care. J&J knows it doesn’t have to sell
dialogue and form relationships. its products in the community. They just have
to increase the number of influencers that are
knowledgeable and engaged and that will bring
Q Is social media different in a B2B context
product sales along. So far, 10% of all U.S.
than in a B2C context?
diabetes educators have joined and J&J is
A Whether it’s consumer or business, the core finding a two to three times increase in
principles of dialogue and relationships are the engagement with these programs.
same. In a consumer model people are often
looking for affinity with similar minded people American Express Open Forum is an example of
or to connect with a celebrity. a small business community that has grown to
hundreds of thousands of unique visitors per
In B2B communities, however, the focus is on month over a multi-year period. They’ve seen
the content an influencer or other community increases in American Express cards issued and
member delivers. B2B participants are looking in transactions per card that they can correlate
for what industry expert John Hagel calls ROA – to the activity in that community.
Return on the Attention they provide. They
want relationships, content, and expertise that
will help make them successful in their
businesses.
© Catalyst Strategies 2011 www.catalyststrategies.com |2

3. Catalyst
vol. 4 – summer ’11
sparks
ideas to ignite growth
One other example is eBay. Their online The second success factor is how the brand
community of a million sellers started off with a participates. It’s your party so you need to be
focus on support for how to sell on eBay. Over there and be the host or have someone help
time, it developed into a forum for members to you host. Howard Schultz at Starbucks (an early
help each other with their businesses and even LiveWorld investor) likened our online
connect on personal topics. It’s a good example community moderators to his baristas – people
of social being more than a channel. The who set a tone and create a cultural
interactions are valuable to the community and environment.
to eBay. A Harvard Business Study from a few Finally, the effort needs to be integrated with
years ago showed that sellers who are active in the rest of your marketing and your
the community sell six times as much as those organization. To really be successful, you need
who are not active. more and more parts of your company involved
over time. It can’t stay in marketing. Whoever
Q What are some key components in a social champions the effort, whether from marketing
media strategy? or another area, needs to champion it for all
A First, you need goals, a strategy and an parts of the company because it’s going to
implementation program based on your affect customer support, sales, product
business goals, the brand and customer needs. development, etc. in ways that nothing else
“We should be on Twitter,” is not a thought out does. The more people in the company that
social media strategy. Think through what participate, the closer you’ll be to your
you’re trying to do and come up with a customers.
measurable goal, even if it is just to learn
something. Q How do you know when your social media
strategy is working?
Next make a sustained strategic and resource
commitment to support the social media effort. A One good indicator of success for your social
We’ve seen a lot of people start and stop. That media effort is that you’re seeing the
doesn’t work. As one of our clients once said, emergence of brand ambassadors or, if you’re
“This isn’t just for Christmas. It’s for life.” This having a crisis, brand defenders. These are
is relationship marketing and relationship people who are enthusiastic about what you’re
marketing wants follow through. You need to doing and becoming personalities in your effort.
have people dedicated to the effort. A second indicator is that you’re getting a lot of
Once those elements are in place, we questions from your community. Questions
recommend focusing on three key success mean customers perceive your brand as one
factors of a social community implementation: they want to interact with. If you have a blog
the cultural model, how the brand will with no comments, you’re not fostering
participate, and how it’s integrated with the engagement and that’s not very social. You
rest of the organization and its marketing. want real dialogue amongst your customers and
with your company.
Think of the cultural model for your social effort
as the kind of party you are throwing – a gallery A third way you know you’re succeeding is that
opening versus a rave, for example. The you’re learning new things – like what your
cultural model should reflect, extend and brand really is – because you’re listening and
positively affect your brand while appealing to talking to your customers. We’ve had clients
your customers. say “That’s not our brand,” when they get
feedback. But if that’s what your customers are
saying, it is your brand. It may not be what you
© Catalyst Strategies 2011 www.catalyststrategies.com |3

4. Catalyst
vol. 4 – summer ’11
sparks
ideas to ignite growth
want your brand to be, so you can either adapt of culture, community and brand. And, there
to what your customers already think your will be new applications and services that we
brand is or do something fundamental to don’t understand or realize yet. Right now
change it. everyone is thinking social is Facebook but
there are other players starting to emerge that
will be big.
Q How do you ensure social feedback is
shared inside a company? In two to five years, demographic segmentation
will fall away. Demographics were a guess
A Operationalizing and deploying the
about what people want based on data we
learnings from a social effort is very important
could get. But now we can see how people
and something the world is quite immature on
think, behave and interact online so you can tell
now. A best practice example is eBay voices, a
what they want instead of guessing. Segments
private message board and advisory council
in the future will be driven by opinion and
made up of selected community members. The
behavior.
feedback is reviewed by the executive team
every week and everyone in the company In five to ten years, corporations that are not
knows about it. This allows the executive team running internally and externally on a social
to understand the customer better but it also network model will have trouble hiring and
sets a powerful cultural model for the company retaining people. In the 1960s, if you didn’t
around listening to and engaging customers. have a phone system who was going to work for
you? Similarly, in 2020, you’ll need a social
Q How do you mitigate the risk of bad PR network model to attract people coming out of
with a social media effort? school now who use social media as their
A People worry that their customers are going primary means of interacting, learning and
to tell them what the company should be doing. thinking.
I ask them, “Don’t you spend a lot of money Also in ten years, customer awareness will
trying to get that information?” Companies move across borders. Companies will no longer
want to know what their customers think but be able to rely on geography to artificially
they need to break some bad habits. segment their products, behaviors and
You have to have an attitude of running practices. Being locally relevant will still be
towards your customers, not away from them. important but customers in one country will
Anyone who’s going to say something online know how you do business in every country.
today is going to say it whether you’re there or This will hasten another phenomenon of the
not. You might as well listen to it and position “best practice anywhere” becoming the
yourself as a company that is seeking feedback “minimal expected practice everywhere” – like
and learning. It’s uncomfortable and difficult Amazon’s 1-Click. Today if you’re on any e-
but companies that engage customers well will commerce website, you want to be able to buy
beat their competitors. with one click because you’ve had that
experience. This expectation started with
Q What social trends do you think we’ll see in consumers but it will become the norm in B2B
the next few years? as well.
A In the next two years, social media will Finally, new experience models will emerge that
become more pervasive and the velocity will will be very visual and mobile and will further
continue to increase. You’ll see more businesses ignite social.
orienting toward their customers and engaging
them. Marketing will become more a mixture
© Catalyst Strategies 2011 www.catalyststrategies.com |4

5. Catalyst
vol. 4 – summer ’11
sparks
ideas to ignite growth
bio
Sandy Carter is Vice President of Social Business
and Collaboration Solutions Sales and Evangelism
at IBM where she sets the direction for IBM’s Social
Business initiative, works with companies who are
becoming Social Businesses, and is the evangelist
Social business mantra for ‘11 for the concept and best practices around Social
is a people play Social businesses have Business. She is the best-selling author of two
For Sandy Carter real advantages books, an avid social media evangelist, and is one
VP, Social Business & of the top Bloggers and Twitter-ers in IBM. Prior to
her current position, Ms. Carter was VP, Software
Collaboration
Solutions Sales & favorite catalyst Business Partners and Midmarket where she was
responsible for IBM’s worldwide software
Evangelism at IBM, Sharing social business ecosystem initiatives.
social business is expertise
creating competitive Ms. Carter holds a B.S. degree in math and
advantage by computer science from Duke University an MBA
leveraging insights and from Harvard, and is fluent in eight programming
speeding information languages. She received a patent for developing a
within and across methodology and tool to help customers create a
technology deployment path in automation of their
companies.
IT processes.
Q How do you define social media? We’re already seeing from our 2010 Global
A Actually, we don’t think in terms of social Chief Human Resource Officer Study that high
media. We think of the broader concept of performing companies – those with better stock
“social business”. Social business elevates prices, profits and business results – are 57%
social media to be used in a work setting, more likely to use social techniques in their
speeding business along with real-time insight companies.
and making social interactions truly impactful to
a business. Q What B2B uses of social are you seeing now?
We define social business as a nimble, A In a B2B environment, you want to build a
transparent, and engaged two-way dialog that trusted relationship, drive brand advocacy, and
removes boundaries between experts inside create dialog across communities and channels.
and outside of a company. We strongly believe B2B is more about developing your best friends
that social businesses will be more agile, more whereas B2C is more about developing a party
responsive and more successful than non-social with a big group of friends. B2B client
businesses. They’ll activate networks of people relationships tend to be deeper and take a little
to improve their processes, marketing, longer. You can see that difference in how two
customer service and more to create a higher companies used social in product innovation.
return on investment.
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6. Catalyst
vol. 4 – summer ’11
sparks
ideas to ignite growth
Consumer-focused Coach developed a forum Now, we’re using social to showcase how the
for crowdsourcing one of its bags. They had technology can help in healthcare, supply
something like 6 million engagements – a great chains, and customer service and support by
response from a broad audience. being able to analyze data and find problems
On the other hand, we recently worked with a before they become problems. We’ve enabled
company focused on tapping a small private our sales teams with a content activation
community in biotechnology. They also wanted package with all the Watson facts and figures.
the community to provide them insight on their We have really filled up our pipe and focused on
next generation product through social. But lead generation using a Watson starter kit. The
this company accessed a smaller set of approach we took with Watson truly
influencers in a private community for exemplifies a change in our marketing and sales
brainstorming and sharing insights on processes leveraging social.
breakthrough ideas. Internally, we use our community platform –
But being a social business isn’t just about B2B IBM Connections – to connect a leadership
or B2C. There’s such power in using social network. We’re a very complex matrix
media even inside a company. Collaborating organization that is constantly building the next
inside is a powerful way to share expertise, generation of leaders. We share best practices,
develop products, and make business decisions education tips, and opportunities to grow.
faster and cheaper. Slumberland Furniture, a Social provides us a way to strengthen informal
small Midwestern furniture company, uses networks and create new relationships.
social media internally to train its franchisees. We have also documented real savings from our
They do video training, share best practices real internal collaboration efforts. In 2010, we saw
time, and have debates across their 120 a 50% productivity improvement in some areas
franchise stores. They’re able to leverage ideas and $4.5 million in savings using inside
and best practices from experts within their collaboration. We saved $700,000.00 per
own business environment. month in travel using video collaboration, and
had significant reduction in e-mail server costs.
Q How is social driving IBM’s growth?
A IBM leverages B2B marketing by embedding Q What’s important in a social business
social in everything we do. A great example is strategy?
how we used social with Watson. Watson is a A We have a framework for social business
DeepQA machine that can understand natural that we call our social business agenda (see
language and deliver a single, precise answer to graphic below). It starts with a company
a question. Most people know Watson as a aligning its goals and culture. If you don’t do
recent Jeopardy contestant but the technology that, you may get a lot of hits, views and fans,
represents a huge leap forward in data analytics but that’s not what this is about. Eventually, it
technology that will have a big impact on is about impacting your business, so if you can’t
business and industry. show business results and align business goals
We used social to connect people to Watson to it, it’s just going be something on the side.
and spark their imaginations about what the The second thing we do is we teach companies
technology could do. We sponsored Watson how to gain friends and develop social trust. As
parties where customers could watch the a B2B company, you want to find your
Jeopardy event, talk to our scientists live “tippers”, those important influencers. Our
about it and tweet about it. Watson has a studies and those of the analysts show that
Facebook page. He’s got a Twitter ID and a somewhere between 5% and 16% of all the
YouTube channel.
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7. Catalyst
vol. 4 – summer ’11
sparks
ideas to ignite growth
authors and engagers in the blogosphere Q What social trends do you think we’ll see in
influence everyone else. So, if you are trying to the next few years?
make an impact, you don’t need to go after a A I see the whole area of crowdsourcing and
million people, just the 5% of that million expert sourcing becoming more popular. I see
people that will influence all the others. mobile growing exponentially. Social gaming
Once you know your goals and who your friends will be on the forefront of how we learn and the
are or need to be, we define the engagement way we interact with brands. And location
experiences that are important to those people. based services are at the cusp of making a big
Then, we look at which processes will deliver breakthrough.
the best ROI for you, and which of those you And, of course, this whole area of socially
want to socially enable. Is it human resources, enabling your business processes. Back in the
marketing, customer service? What’s really Internet and early e-commerce days, I’d talk to
going drive ROI for you? companies who would laugh at me and say, “No
The fifth step is to help you develop a one’s ever going to use the Internet for
reputation and risk management plan. This is business. It’s just not going to happen.” Now,
the number one concern of most C-level of course, you can’t have a business without the
executives I talk to. They tell me, “Social is too Internet.
risky. I can’t do it.” But not doing anything is I think the same thing is happening in terms of
just as risky because people are already talking social business. I see a lot of companies saying,
about you. It’s better to be the one setting the “That’s for kids, something my daughter does.
tone and trying to engage in a positive way than It’s not going impact my business.” But this will
sitting back and allowing the conversation to be be a bigger trend than the Internet was and it
random. will be more important to get in early. E-
The last thing is we focus on is analytics. This is commerce was more of a technology play but
a combination of software, services, and plain social business is a people play. Social is
old planning. IBM is also a great social business, relationship based so getting involved early will
and we take the lessons we’ve learned and help build relationships and create a time
share those publicly. advantage that will make a difference. We
know social businesses are outpacing their
competition and accelerating growth.
© Catalyst Strategies 2011 www.catalyststrategies.com |7

8. Catalyst
vol. 4 – summer ’11
sparks
ideas to ignite growth
bio
mantra for Matt Tucker, co-founder and CTO, is
‘2011 responsible for the long-term technical
and strategic direction of Jive's products.
Make work great
Along with Bill Lynch, Matt founded Jive
again
Software in 2001 and has helped build
Social business is the company from just two people to
a revolution favorite catalyst where it is today. Matt is an active
For Matt Tucker Making work fun member in open standards communities
Co-Founder and CTO of again for the tired, including having served on the board of
Jive Software, social the poor, the the XMPP Standards Foundation.
business is making work huddled masses Prior to Jive, Matt worked as a software
better by improving the yearning to breathe engineer at an internet startup in San
software with which we free (the cube Francisco called 4charity.
communicate and dwellers)
collaborate. Matt holds a BS in Computer Science
from the University of Iowa.
Q How do you define social media? Social business represents a revolution in how
employees inside companies can communicate
A Social media is the set of technologies in our
and collaborate, and also how companies
consumer lives that have transformed the way
communicate with their customers and partners.
we communicate and engage with our friends
and family via sites like Facebook and Twitter.
For businesses, there is social business software Q How are companies using social business
software to grow? What problems are they
and we tend to use the term social business,
tackling?
rather than social media.
A On average, sales reps spend 20% of their
time searching for information. That’s money
Q What’s driving the shift to social business?
left on the table. Social business software
A Over the past decade, there has been a connects sales reps with the experts, content,
profound lack of innovation in the tools we use and information they need to collaborate so
for communication and collaboration in our work they never sell alone. This makes their sales
lives. Most of us are still stuck in email and teams more efficient. They share best practices
Microsoft Office or with enterprise software that and get the latest field or competitive data as
is really hard to use and provides a terrible user quickly as possible which significantly impacts
experience. There’s a reason that shows like revenue generation.
“The Office” or cartoons like “Dilbert” exist. It’s
because work sucks. Most of us understand that Sometimes companies are simply looking to
and implicitly understand that we need better provide tools that will get the next generation of
tools and new ways to work together. employees really engaged. Recent college
graduates have grown up using Facebook, Twitter
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9. Catalyst
vol. 4 – summer ’11
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and that whole set of technologies which make it to facilitate collaboration easier. They shaved
easy to interact with their entire social network. days off the bid and proposal process which has
If they get into a company with ten-year-old lowered customer acquisition costs and driven
technology, they are just not satisfied. For them, broad process efficiencies.
social software is about enabling tools and user
Second, social business software greatly
experiences that employees now expect.
improves interaction with customers and
Innovation is another major challenge companies partners. In our survey, companies saw:
can and are addressing with social business  42 percent more communication with
software. Rather than having an in-person once customers
a year customer advisory board meeting, they’re  31 percent increase in customer retention
gathering real time customer feedback and ideas  28 percent decrease in support call volume
by sharing the latest road map and product plans.  34 percent more feedback and ideas from
This makes the iterative innovation cycle much, customers
much faster.  27 percent increase in new customer sales
So, companies usually choose a business driver SAP is an example of a customer that uses Jive to
and set a goal of driving very specific results. power its 1-million strong collaboration network
After they see the results, social becomes a for software developers, business process
ubiquitous communication and collaboration experts, customers, and partners. Their social
layer and they keep finding more and more business community achieved a 5% reduction in
challenges to take on with the social approach. product release cycles and a 5% increase in
partner sales.
Q What kinds of results are Jive customers Similarly, Intel was able to increase engagement
seeing with social?
and reduce costs by shifting half of its partner
A We recently surveyed our whole customer events to the web. Intel’s business is primarily
base to try to quantify the business impact of channel driven so enabling a large-scale online
social business adoption. The feedback clearly partner community has significantly reduced the
indicates a material impact on business huge costs ($500k+ per event) associated with
performance. enabling 200,000+ partners around the globe.
First, social business software can make
employee communication profoundly more Q Are there companies that should not pursue
efficient, enabling interaction with a much wider a social business strategy?
variety of employees much faster. Surveyed
customers showed impressive results, including:
A If your customers or your partners are on
Facebook, Twitter and other consumer social
 30 percent increase in employee satisfaction
sites, then you should be too. You should have a
 27 percent less email volume
social media strategy. But, every company should
 32 percent reduction in time to find answers
be looking at a broader social business strategy.
 37 percent increase in project collaboration
and productivity Social business software is the most important
new enterprise software category in at least a
CSC is an example of a customer that has seen
decade because it will touch every employee and
great results. They have 92,000 employees in
be a part of every customer and partner
over 90 countries, so barriers like time, distance
interaction in every vertical. There is no pocket
and siloed organizations were complicating and
of the enterprise that is not adopting it and any
lengthening their proposal process. Their Jive-
company can benefit from implementing social
powered community attracted 25,000 users in its
business software.
first 20 weeks and made locating internal experts
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10. Catalyst
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However, some companies are more ready than Q What trends do you think we’ll see in B2B
others to adopt social software, for a couple of social in the next few years?
reasons. One is general readiness which is based
on things like the company culture and age of the
A The first trend is that Facebook is at over six
hundred million users and racing toward a billion.
work force. These impact how quickly people are
This has already transformed our consumer lives
able to change the way they work together. The
and we are at the early stage of the impact that
second is the size of the problem that the
social will have on business. I expect there is
company is trying to solve. The larger the
going to be massive growth in the next two to
problem, the more worthwhile it is to address
four years in social business and 2011 will be an
with social business.
inflection point for mainstream adoption in the
enterprise.
Q What’s important in a social business
strategy? The second trend is that social is becoming a
platform inside companies. There have been
A First, choose the right problems to tackle first massive investments in ERP, CRM, and different
so that it is successful and embraced inside your content management systems in recent decades.
company. Select a couple of really hard problems Social business software is becoming the layer
that social can have a massive impact on. That that connects all of those different systems with
will drive change and how people are willing to people. It’s a much easier and faster way to
interact with one another. Innovation is an interact with all that content. So in the
example of a big problem that is a critical piece of enterprise world, social as a platform or layer
some companies’ entire strategy. Making across the enterprise is one of the biggest trends
innovating faster and better by speeding iteration we’ll see over the next couple of years.
cycles leads directly to top line revenue and to
growth. A third trend is that social business will come to
where you are already working. Social represents
Second, keep in mind that implementing a social a profoundly new way to get work done and
effort is not just a matter of choosing a people don’t change overnight so there has to be
technology and deploying it. There are a set of a way to transition into this new way of getting
cultural and process changes to factor in as well. work done. So, bringing social tools to Microsoft
Social truly is a new way of getting work done so Office or your email where you already work is a
it means adopting new ways of working together really important trend.
as employees and new ways of interacting with
customers and partners. All of these changes will mean that work will be
good again. It will be as easy and fun to interact
with people in your work life as it is in your
Q Does social require people in different roles or
personal life. Most of us spend the majority of
just in the same roles doing different things?
our lives at work so if we can make that truly
A There are some new roles that are created better, that’s a mission we get pretty fired up
inside of companies for social. There is a about at Jive.
community manager that helps run and nurture
the implementations of social business software.
Customer support folks will need policies and
guidelines on how to engage with employees,
customers and prospects on the company’s social
platform as well as on Facebook and Twitter. You
shouldn’t need a lot of training to get started, but
it is a different way of getting business done so
you need to go about it the right way.
© Catalyst Strategies 2011 www.catalyststrategies.com | 10