Blue pill, red pill? What is the social matrix?
An article in the McKinsey Quarterly by Jacques Bughin, Michael Chui, and James Manyika, Ten IT-enabled business trends for the decade ahead, describes ten key digital information trends looming large on management agendas.
These ten trends are listed below but the most relevant is the first: joining the social matrix. The social matrix is not just relevant to big business. Anyone with a stake in an organisation needs to be aware of how these trends are going to affect how they conduct business.
The social matrix is much more than social media: it connects many organisations internally, and increasingly externally, to reach audiences, like suppliers and customers. The social matrix also extends beyond the co-creation of products and organisational networks. It is now the environment in which more and more business is conducted.
Many organisations rely on networked problem-solving, using the thinking power of a number of people inside and outside the company for new ideas and solutions. The pharmaceutical giant Boehringer Ingelheim, for instance, sponsored a competition on Kaggle (a platform for data-analysis contests) to predict the likelihood that a new drug molecule would cause genetic mutations. The winning team, from among nearly 9,000 competitors, combined experience in insurance, physics and neuroscience and its analysis beat existing predictive methods by more than 25 percent.
Searching for information, reading and responding to e-mails and collaborating with colleagues can take up about 60 percent of knowledge workers’ time: they could become up to 25 percent more productive through the use of social technologies. IT-services supplier Atos has pledged to become a zero e-mail company by 2014, aiming to boost employee productivity by replacing e-mail with a social networking platform.
Companies also are becoming more open, ready to communicate across traditional functions and assemble teams with the specific knowledge required for a project. Kraft Foods, for example, has invested in a more powerful social technology platform that supports microblogging, content tagging and the creation and maintenance of specialised communities. Benefits include accelerated knowledge-sharing, shorter product-development cycles and faster competitive response times.
Enterprises still have plenty of room to improve: only ten percent of the executives surveyed last year said their organisations were realising substantial value from the use of social technologies to connect all stakeholders: customers, employees, and business partners.
Social features, meanwhile, can become part of any digital communication or transaction — embedded in products, markets and business systems. Business users can like things and may soon be able to register what they want, enabling new means of registering preferences and, as a by-product, inceasing motivation.
Department-store chain Macy’s has used Facebook Likes to decide on colors for upcoming apparel lines, while Wal-Mart Stores chooses its weekly toy specials through input from user panels powered by social media. In broadcasting, RTL Group is using social media to create viewer feedback loops for popular shows such as X Factor: a steady stream of reactions from fans allows RTL to fine-tune episodes.
The ten trends from the research and article are:
1. Joining the social matrix.
2. Competing with ‘big data’ and advanced analytics: three years ago, McKinsey described new opportunities to experiment with and segment consumer markets using big data. As with the social matrix, the firm now sees data and analytics as part of a new foundation for competitiveness.
3. Deploying the Internet-of-All-Things: tiny sensors and actuators, proliferating at astounding rates, are expected to explode in number over the next decade.
4. Offering anything as a service: the buying and selling of services derived from physical products is a business-model shift that’s gaining steam: a prominent example of this shift is the embrace of cloud-based IT services.
5. Automating knowledge work.
6. Engaging the next 3 billion digital citizens.
7. Charting experiences where digital meets physical: real-life activities, from shopping to factory work, become rich with digital information and as the mobile internet and advances in natural user interfaces give the physical world digital characteristics.
8. ‘Freeing’ your business model through Internet-inspired personalisation and simplification: customers expect services to be free, personalised and easy to use without instructions.
9. Buying and selling as digital commerce leaps ahead: reducing barriers to entry across a wide swath of economic activity.
10. Transforming government, healthcare, and education: technology-enabled productivity growth could help reduce the cost burden while improving the quality of services and outcomes, as well as boosting long-term global-growth prospects.