RESEARCH NOTE YAMMER IN PROFESSIONAL SERVICES ORGANIZATIONS THE BOTTOM LINE THE SITUATION WHY YAMMER. October Document M120

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1 RESEARCH NOTE YAMMER IN PROFESSIONAL SERVICES ORGANIZATIONS THE BOTTOM LINE Professional services organizations are improving business collaboration and corporate outcomes by deploying Yammer for agile product development and project management, accelerated knowledge discovery, new collaborative roles, improved team realignment and M&A activity, and increased employee engagement. Nucleus found that benefits of these value propositions included an additional $5,000 to $10,000 of business value per employee, the ability to accelerate employee onboarding, and more rapid project development. THE SITUATION As the globalization of industry continues, Nucleus has found that organizations are increasingly adopting enterprise social platforms to facilitate and encourage crossdepartmental and global collaboration, share and seek knowledge, and better engage employees. Professional services organizations are well positioned to gain value from social networks because these companies design products and services based on the output of knowledge workers. These firms seek advantages in sharing ideas and skills throughout the workforce. However, these companies also serve as a harbinger for the general business environment. As businesses increasingly design working environments to treat every employee as a knowledge worker with specific contextual knowledge that can provide value to other employees, they will need to find ways to effectively share best practices among multiple locations and across hundreds or thousands of colleagues that may have a similar problem. For this reason, all organizations should seek to understand how applicable these professional service use cases are for their own industries. WHY YAMMER Yammer is a freemium social platform typically brought in by a small team of employees requiring a lightweight collaborative tool which steadily pervades the company through viral growth. Nucleus analyzed several professional services organizations using Yammer, including LexisNexis; a global provider of content-based workflow solutions; Lowe and Nucleus Research Inc. 100 State Street Boston, MA Phone:

2 Partners, a global network of advertising agencies specializing in strategic planning, advertising, public relations, digital marketing, and retail marketing; and Capgemini, a global IT services, consulting, outsourcing, and professional services provider. Nucleus found that Yammer entered each of these organizations through a small group of employees adopting the free version for small projects and day-to-day collaboration before growing to 200 to 300 employees based on viral growth and personal invitations. These deployments then expanded by orders of magnitude as organizations pursued change management strategies that increased the business value of social networking. KEY BENEFITS All of the Yammer customers profiled found that their existing collaboration investments played important roles in supporting one-to-one interactions and formal versioned control for content, but they were not well-suited to collecting real-time and informal feedback based on serendipity. Nucleus identified five key value propositions that Yammer provides for knowledge workers to improve corporate outcomes: better collaboration for more agile product development and project management, improving knowledge discovery, facilitating collaborative roles that were previously lacking, supporting realignment and M&A (mergers and acquisitions) activity, and increasing employee engagement. BETTER COLLABORATION FOR AGILE PRODUCT DEVELOPMENT By opening up the product development and project management processes, Yammer has also allowed companies to pursue agile and rapid development for new ideas. Capgemini found that employees were able to innovate more quickly, resulting in the creation of additional asset-based business models and intellectual property that could be delivered to customers. In addition, Capgemini created a specific hashtag (#Yammerbenefits) to help document any comment or conversation that lead to business benefits. At this point, Capgemini has tagged over 100,000 of these benefits, which demonstrates the pervasive and continuous innovation possible through an online social environment. At LexisNexis, Jonathan Kerry-Tyerman, Senior Director of Innovation, wanted to create a rapid innovation team to quickly create a new product for law schools. Initially, LexisNexis identified a cross functional group, including marketing, law school outreach personnel, technology partners, and concept designers, and invited them all into a dedicated Yammer group. Through Yammer, each department provided constant, real-time updates on each of the tasks that they were assigned to accomplish while minimizing project meetings to a single half-hour weekly update. LexisNexis was able to condense its product development time from a traditional cycle of six to twelve months to only six weeks for this alpha product. This approach represented a 45% reduction in the number of employees involved and a 30% reduction in total man-hours associated with this new development process. Page 2

3 By using Yammer for agile product development projects like this, LexisNexis has translated its internal social network into improved business agility. And although Yammer is not a fully-developed project management solution, it serves a valuable role in centralizing feedback, new ideas, and status reports on a real-time basis. LexisNexis was able to condense its product concept to launch time from an average of six to twelve months to only six weeks by using Yammer. KNOWLEDGE DISCOVERY Yammer also supports distributed enterprise collaboration and knowledge discovery better than legacy collaboration applications. Nucleus found that the greatest value of Yammer for Lowe and Partners and LexisNexis has come from the ability to broadcast requests to specific audiences and find other people working on the same problem. Since Yammer users have to opt into each group that they follow, each employee creates their own customized social environment based on their own interests. For Capgemini, Nucleus found that Yammer helped employees to prioritize and broadcast bidirectionally in a more selective manner. This allowed employees to share information more quickly. Rather than send an to 1,000 undifferentiated people about a topic such as infrastructure transformation or developing low-latency Java-based applications, employees could post a specific topic and target an opt-in internal audience that had already shown an interest in one or more keywords associated with that post. "To find an answer, you don't send an to 20,000 people and hope for a response. With Yammer, it is easier to find direct and indirect contacts who have the answer you need. You're not constrained by department or hierarchy." Rick Mans, Social Media Strategist, Capgemini As globalization becomes a business norm, companies increasingly are challenged to match appropriate skillsets. By creating specific topic-based groups, Yammer users were able to find like-minded employees and partners, regardless of geographic location, to discuss topics ranging from corporate volunteer activities to technical queries regarding very specific expertise. FACILITATING COLLABORATION AND THE NEW INTRANET Yammer delivers a new social intranet capability by serving a new and less formal collaborative role that traditional collaborative tools cannot support. Although companies have had , document management systems, and content development capabilities for decades, all of these tools lack some aspect associated with the more open and collaborative nature of an enterprise social network. With the use of a social network, each employee to access the information that is relevant to their needs and create an individualized knowledge environment rather than depend on Page 3

4 a centrally designed portal or intranet approach. By pushing the community design from an internal developer to the corporate end user, Yammer helps provide a new form of intranet. We have SharePoint, team rooms, and open source wikis. All of them have their use cases and are focused on specific topics, but there was a gap in the way we collaborate. With Yammer, we can work on innovative ideas and commit people to new ideas more quickly and easily." Ron Tolido, CTO, Capgemini Through Yammer, key debates and discoveries can be further discussed and elaborated upon throughout the rest of the month. Since Yammer provides an online repository to support continuing discussion, Capgemini has been able to change the traditional monthly meeting from a stand-alone touch point to an interactive set of discussions that provide value long after the meeting has finished. For example, Frank Wammes, vice president of the SAP practice at Capgemini, uses Yammer to communicate with his team of about 100 consultants monthly with a one-hour formal session to bring up topics and start debates among his team. Since the internal cost of this session can be estimated at approximately $20,000, it is essential for Capgemini to maximize the value of this meeting. Although many organizations have meetings with similar internal costs, Wammes has been able to extend the value of this meeting by extending each session into an ongoing collaboration that provides insight and additional productivity throughout the month. By conducting this Yammer-based meeting, Wammes allows his consultants to directly respond as they think of new ideas without interrupting any other individual. He articulates the value of this social session as a two-way collaborative environment as follows, "I like to speak with my consultants, but find that a conference call ends up being more one-way. With Yammer, there is shared context to build on after the meeting." TEAM REALIGNMENT AND M&A ACTIVITIES Nucleus also found that Yammer users saw benefits in supporting team realignment and M&A activity through ongoing collaboration. As a global collection of marketing agencies, Lowe and Partners is continuously adding new agencies to support a global market. One of the first uses of Yammer at Lowe and Partners was when an office in the Philippines used Yammer to develop a business pitch on behalf of a client. This office took to Yammer quickly, and as the project developed, Filipino employees invited additional colleagues to join their Yammer group from Malaysia and China. By bringing together multiple skillsets in multiple countries, Lowe and Partners was better able to provide a cross-cultural and varied perspective to this project. Eventually, this group ended up consisting of 43 employees from multiple countries who were all able to effectively collaborate by tracking and responding to each other. Through Yammer, this team was Page 4

5 able to track task management and review documents in real-time, which resulted in a successful pitch which won additional business in Vietnam, Cambodia, and Singapore. Lowe and Partners also uses Yammer to aid onboarding for new agencies that have been acquired so employees can understand what is happening within their new organization. By following this activity, each of these new agencies can understand the key challenges and projects that their colleagues are facing as soon as they have been added to Yammer rather than wait weeks or months for a formal introduction to key strategic initiatives. This knowledge can accelerate the time needed to bring new employees to full productivity from several months to a couple of weeks, which Nucleus estimates at an additional $5,000 to $10,000 of business value per employee. Yammer has enabled Lowe and Partners to achieve an estimated additional $5,000 to $10,000 of business value per employee by reducing the time needed to educate new employees from several months to a couple of weeks. EMPLOYEE ENGAGEMENT Through an enterprise social network, Yammer users also saw benefits in engaging employees more easily. This engagement could either be formal, such as extending the topics of a corporate meeting into an ongoing online debate, or informal uses such as introducing a transferred employee to a new city. Within LexisNexis, Yammer adoption accelerated by over an order of magnitude to over 4300 employees in two months when it was used to coordinate Spirit Week, an annual enterprise-wide event used to highlight customer success, support employees, and give back to their local communities. As employees shared ideas for volunteering opportunities, employee recognition, and corporate activities for Spirit Week, LexisNexis started to better understand the value of using Yammer to discuss specific topics that affected the entire company and could only be solved with skill sets and proprietary knowledge scattered across the company. "We wanted employees to share the idea or news item they wanted everyone to see. This is where Yammer was far superior because employees can decide what to follow rather than see everything that gets posted." Jonathan Kerry-Tyerman, Senior Director of Innovation, LexisNexis By creating an environment that allowed employees to openly discuss the most relevant topics in the company, Yammer provided employees with an outlet that was flexible enough to manage both formal and informal knowledge inquiries associated with a wideranging enterprise-wide cultural theme. Page 5

6 CONCLUSION Enterprise social network deployments follow a new and different pattern for adoption and deployment. These technologies are often brought in by line-of-business employees seeking to bridge collaboration gaps that in-house technologies cannot effectively support and then brought to the attention of IT and security when the social network must scale to an enterprise-level and integrate with other applications. This trend provides challenges in defining the breadth and repeatability associated with gaining ROI from technology projects (Nucleus Research b20 ROI quick reference guide, May 2001). Because social networking technologies can be introduced without considering these ROI contributors, companies can be challenged to understand the ROI of social networking. The professional services organizations interviewed for this research note initially faced similar problems as they dealt with an employee-driven instance of Yammer that appeared in their organization. Although Capgemini s Yammer deployment was championed by the CTO, both the breadth and repeatability were in doubt during the early stages of this deployment. For both Lowe and Partners and LexisNexis, Yammer was brought in by lineof-business organizations before these companies decided to scale these technologies. However, as each of these companies continued to use Yammer, they found common ground in several key value propositions. Although these mature organizations had already adopted separate solutions for talent management, project management, product development, and collaboration, they found gaps in each of these areas that could only be solved with a social network that opened up new capabilities for ideation, sharing ideas, and supporting creative teams. By closing gaps between identifying an initial need and developing a final business deliverable in multiple business departments, Yammer accelerated these companies abilities to achieve favorable business outcomes. With this approach driven on aligning Yammer s capabilities with practical business outcomes, Yammer has provided value in multiple respects. With Lowe and Partners, Yammer was a core tool to help win business in a multicultural environment. For Capgemini, Yammer has created a new type of business meeting and serves as a peoplebased knowledge and advice repository for professional services. And at LexisNexis, Yammer has become an agile product development tool and a core collaboration platform for enterprise-wide efforts. None of these uses cases were particularly novel or unique to these firms. For these professional services firms, the value of the enterprise social network came from the ability to translate networks of talented professionals to improve business outcomes across a multitude of different use cases. As organizations seek to improve the productivity and innovation of knowledge workers, they should consider the successes that professional services organizations have achieved from their use of an enterprise social network to fill infrastructure gaps and gain value throughout the organization. Page 6