Measuring the Value on Investment

More thoughts in the aftermath of the Gartner Symposium in Cannes and the Exeter Likeminds Event.

I had heard the term Value on Investment (VOI) sometime ago, but it never really held much ground in my thinking, Although i’m surprised as it is something that is complimentary to Social Software projects and Knowledge Management Projects.

For those of you who haven’t come across VOI before i’ll try and explain the difference between VOI and ROI (return on investment). Return on Investment is based on return, which is generated by tangible outcomes, such as increases in productivity, increased revenues, cost reductions or entering new markets. VOI however focused on intangible benefits, in particular those related to technology based initiatives and for the purpose of this post consider Social Media/Social Software as key areas to focus on.

Gartner describe VOI using 5 measurable elements or outcomes. Value building initiatives change organisation dynamics by encouraging: (Hint: spot how many can be facilitated by social media and social software)

  • business process reinvention and innovation
  • cultivation, management and leveraging of knowledge assets
  • collaboration and increased capabilities to learn and develop communities
  • individual and organisational competencies
  • new kinds and levels of leadership

Don’t know about you but i’d tick all for social media and social software.

There is something you need to accept, however when measuring VOI. The more strategic the project the more value you will see in return.

When considering the current economic climate and situation, we should and must consider the VOI aspect as well as the ROI to achieve the level of organisational change that will future proof organisations for when we return to a growth scenario.

It also encourages greater alignment of IT and the Business, As the business needs to take the strategic advantage of the technology. IT alone offer no advantage to the business. To extract the value, the business would have to transform processes and practices, enhance knowledge sharing, establish communities of practice, develop competencies and provide tools for new leadership.

The strategic impact of social software will come over time with the cumulative effect of small projects impacting on the business and initiating change along the way.

My take on this really is that to succeed in the long term and to demonstrate the real value of social media and social software, it will take time, so be patient.  It will develop as each new project delivers results and value along the way.

This exact approach is how i realised the value. I started with twitter, then a blog, then started social bookmarking, then started sharing photos and so on. The cumulative effect of all of these choices have transformed the way i work, collaborate and engage with people.

So focus more on the Value and less on the Return – But ensure you measure both along the way.

#khub – IDeA Knowledge Hub

Yesterday I attended the IDeA Knowledge Hub Advisory Group in London at the IDeA offices.

Before today my only awareness of the hub was based on sporadic conversations with Steve Dale, which sparked enough interest for me to talk to colleagues internally and see the opportunities for the hub to solve a wide range of business issues being raised in my council.

It really has the potential to transform how the public sector and in-particular local government can share learning and collaborate on improving services. It will mean some pretty fundamental challenges to how practitioners get involved in sharing experiences and practices that a peer community can promote as practice worth repeating.

But also the hub sets out a new direction for the IDeA itself from:

The IDeA supports improvement and innovation in local government. We work with local authorities and their partners to develop and share good practice. We do this through networks, online resources, and support from councillor and officer peers – quote directly off the IDeA website

The khub transforms that relations and reverses their whole business model to one which gives control and ownership of the practice, publishing and content creation to the local government sector. A model that in time could signal the end of the IDeA as we know it today. It would essentially reposition the organisation to one which facilitates the knowledge creation and supports practitioners through learning and training programmes. But also the hub in time could be even bigger than that and could lead to being part of a more open, transparent government and foster a real knowledge sharing culture in the sector and wider. All based around story telling and first hand learning.

So I guess you may be asking “what is the knowledge hub?” Well conceptually that is sort of straight forward to explain but at this point in time practically what it takes is some diagrams and some excellent presentations from Steve Dale and Ingrid Koehler.

Steve Dales slides

Ingrid Koehler slides on Social Media Strategy

The Advisory Group itself was quite small but mainly due to other commitments not through interest, although it did have some usual suspects in and around the social media movement.

What i think some of the major challenges will be in relation to the Khub is the change in the underlying culture that restricts or stops people from sharing practice worth repeating and individual learning experiences. This is essentially the challenge to allow conversations and people to connect in new innovative ways without imposing barriers or silos over them to restrict those conversations.

I believe that everyone in all parts of the public sector understand the need for improvement and the challenge in identifying where and how improvement might occur, but if we could create and foster a culture that made learning a natural and fundamental part of our work i believe the Khub would revolutionise the sector as a whole. We also recognise the power of the social networks (offline) we are all part of that help us do our work and contribute to our learning. The opportunity is to widen those networks and to use the technology to connect people to conversations they may not have had access to.

There are also challenges within each council or public sector body, as it isn’t always straight forward and easy to surface the current practice that happens on the front lines, as most practice is often documented by policy officers who then rework policy to try and drive improvement, this process however is flawed because of the time it takes to go through that cycle.

The opportunity the Khub could provide is access to “live” improvement and learning information. We would then need to understand how our processes could and should change to allow progressive change and improvement and the policy aspect needs to be more fluid and dynamic to enable the freedom for front line practitioners to continuously improve their services.

The whole thing is exciting but yet huge and overpowering at this point in time, the great thing about being part of the advisory group is that we can contribute to the development and see this whole thing grow from the bottom up.  It also allows those involved to see things happening and not continually get distracted by the huge opportunities and challenges.

We need to take one step at a time and the next steps are influence the requirements and inform the procurement process.

A continuous task for the group as a whole is the promotion of this project, well in fact this programme of work across the public sector. This truly is a “business project” and not a technology project.

There are so many things going around my head since leaving the advisory group yesterday, and i will write a few more blogs as my thoughts clear and i am able to make sense of them. but in the meantime I’ll leave the final words to Steve and Ingrid who were captured on video by David Wilcox – Social Reporter