Is this end of the euphoria for social tech?

by Shweta Verma    Nov 12, 2013

social tool

It was almost like, what we call, herd mentality. Companies of all shapes and sizes were going all out to adopt social media technologies as if it was their key to success in the new age. Probably, to some extent, it did work. But after the initial excitement was over, it seems that the growth in adoption of social technologies has flattened out.   

According to the latest McKinsey survey, even though the share of companies using social technologies in their business remains high, growth is now leveling out. Eighty-two percent of respondents say their companies use at least one tool (compared with 83 percent in 2012), and 67 percent report the use of at least one tool on mobile (compared with 65 percent last year). The most commonly used technologies are videoconferencing, social networking, and collaborative editing, which we also saw last year.

McKinsey asserts that even while the pace of adoption has slowed, the corporate users can still take advantage of the untapped potential of these tools. The results suggest these technologies can facilitate substantial organizational change, provided that companies approach social tools as they would any large-scale transformation. The research firm believes there is a lot of room to improve overall adoption, particularly within the organization.

The survey states that four in ten respondents say at least half of the companies’ employees use social networking for work, but less than 30 percent say the same about all other technologies. There are also opportunities to increase external use: 76 percent of executives say their companies deploy social tools to communicate with customers—the most common reason for using these technologies—but on average their companies interact with only 38 percent of customers via social tools. Meanwhile, just 44 percent report using social technologies to communicate with partners, suppliers, or outside experts.

The McKinsey Global Institute last year estimated that $900 billion to $1.3 trillion in annual value could be unlocked in just four sectors by products and services that enable social interactions in the digital realm. “That’s not easy to do, but a large part of the problem is that many companies, viewing social technologies as yet another tool to be implemented rather than as an enabler of organizational transformation, fail to identify the specific organizational problems social technologies can solve,” says McKinsey.

In order to bring back the fading momentum, companies would need to apply tactical changes and strategies for using social tools. User mindsets and behaviors also need to be aligned with the changing environment.