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Does Social Networking Boost Productivity?

Most employers still don’t know what to make of online social networking  technologies. In recent years, the press has been abuzz about how young  people are crowding onto social networking sites such as MySpace and  Facebook, but how these kinds of technologies might affect the workplace has  been a neglected topic.

Part of the problem is that the trend is relatively new, and despite the buzz, usage has been limited to a minority of the population. The Pew Internet &  American Life Project (2007a, 2007b), which regularly conducts nationwide telephone and online surveys to study the impact of the Internet on U.S.  society, found that in February and March of 2005, just 7% of 1,577  respondents had ever used a social or professional networking site. By August  of 2006, the number had risen to 16%.

Among a subset of business professionals, though, online social networking technologies have caught on at a higher rate, according to a May 2007 survey conducted by the Institute for Corporate Productivity (i4cp) in partnership with HR.com. It found that of 322 respondents, nearly half (47%) employ social networking for professional purposes. Of those that use social networking technologies, 71% use them to connect with former or current colleagues, 55% use them to share best practices and answer questions, 35% use them as an aid to finding a job, and 25% use them to meet customers and suppliers.

There’s much uncertainty, however, about whether employers see these as useful technologies. When asked, “How does your organization view social networking technologies?” The top responses—at 31% and 27%, respectively—were, “I have no idea” and “We don’t have a view.” Eighteen percent thought their employers considered such technologies to be “disruptive to productivity,” but 12% thought these technologies were seen as “conducive to productivity.”

Such ambivalence is understandable given how recently these technologies have emerged, the difficulty in defining exactly what social networking technologies are, and their broad range of potential uses. The popular press has generally portrayed online social networking sites as 21st-century virtual hangouts, where people can communicate with friends, locate former schoolmates, meet new people, swap music, find parties, and so on. Few organizations would appreciate their employees spending work hours engaged in these kinds of activities. Nor, of course, would they want workers to spend company time and resources looking around for other jobs online.

On the other hand, the i4cp survey—as well as the broader literature on this subject—indicates that other uses of social networking can do much to raise organizational and individual productivity. Connecting with colleagues as well as counterparts outside of the organization and sharing best practice ideas are, after all, essential activities in today’s knowledge-based economy. Far too often, employees wind up “reinventing the wheel” for their organizations. They can expend effort on doing anything from drafting a gain-sharing plan to choosing a new learning management system, even though the same or similar work has already been done by many other organizations. Being able to tap into the experiences and hard-won knowledge of coworkers or those from noncompeting firms could do much to improve the speed and efficiency of such endeavors.

In fact, a recently completed five-year study conducted by professors Marshall Van Alstyne, Sinan Aral, and Erik Brynjolfsson found that social networks are one of the best predictors of productivity. In this case, though, social networks are defined as the people with whom one communicates via e-mail. Van Alstyne notes, “Social network analyses have indicators of where you are in the network—whether you’re central or peripheral. If you measure the shortest communication path between each pair of individuals, the number of times anyone else appears in that path gives you ‘betweenness'. That means they’re in the thick of information flows, and it’s a good predictor of their productivity” (Melymuka 2007).

Some types of social networking technologies can also make the innovation process more efficient. Procter & Gamble, for example, has created a “connect-and-develop” strategy that requires tapping into various networks, both proprietary and open, to aid innovation. One of those proprietary networks is made up of so-called technology entrepreneurs—that is, senior P&G employees who “combine aggressive mining of the scientific literature, patent databases, and many data sources with physical prospecting for ideas—say, surveying the shelves of a store in Rome or combing product and technology fairs,” as reported in the Harvard Business Review (Huston and Sakkab 2006, p. 63). P&G also uses an open network, InnoCentive, a Web-based community that matches contract scientists with R&D questions that companies are trying to solve.

Such professional networks, which are specifically geared toward boosting performance in a strategic area, could turn out to be a wave of the future. Like many technologies that have come before—from the electric engine to the computer—it might take some time before companies understand how to fully leverage the business value of social networking technologies. But when they do, such tools could go a long way in boosting the productivity of knowledge-based organizations.

Documents referenced in this TrendWatcher include the following:

Huston, Larry, and Nabil Sakkab. “Connect and Develop: Inside Procter & Gamble’s New Model for Innovation.” Harvard Business Review, March 2006, pp. 58–66.

Institute for Corporate Productivity. Social Network Practitioner Consensus Survey, May 2007.

Melymuka, Kathleen. “How IT Makes Johnny More Productive.” Computerworld, February 26, 2007.

Pew Internet & American Life Project. “Internet Activities.” January 11, 2007a.

Pew Internet & American Life Project. “Usage Over Time.” Retrieved June 6, 2007b.

About the Author(s)

Mark Vickers, Institute for Corporate Productivity Mark Vickers is vice president of research at the Institute for Corporate Productivity (i4cp).