Before looking at how social networking might help organizations, I thought it would be useful to set out a simple framework for discussing such investments.

Why invest?

In business, there are three primary motives for making any change:
- to do more or less what you're already doing but cheaper
- to do more or less what you're already doing but better
- to do new things.

These apply separately or in combination. They are also universal, being as applicable to corporate take-overs or buying a fleet of fork-lift trucks as they are to computer projects. In addition, they vary around the organization and can change with time.

In more detail

Cheaper applies to where organizations want to avoid or reduce costs such as labour, machines, materials or bought-in services.

Better can be thought of as two motives in one. The first deals with internal operations. The aims include greater control, better decision making or fewer errors. It is to do with improving capability.

The other part of the 'better' motive is concerned with external working, in areas such as customer support, delivery times or product quality. It is to do with improving performance.

Doing new things is concerned with innovation in such matters as operating methods, organizational structures or markets served. It includes gaining new customers, entering new relationships and markets, finding new routes to market and creating new products.

These motives can be thought of as occupying the quadrants of a circle. Cheaper is lower left, better internally is upper left, better externally is upper right and, finally, new is lower right.

This diagram shows what I mean. Click on it to get slightly better quality.

Note that this a simple, fixed and two-dimensional depiction. The reality of the relationships and their sequences in more fluid and complex than that. Also, it can be cyclical, with investments made initially for cost saving, for example, but renewed with another motive in mind. This is normal.

There are two items on the diagram I haven't yet explained:
- inward and outward focus
- second-tier motives.

Inward and outward-looking investments

It doesn't take much to see that investments whose primary motivation is cheaper or better internally are typically focused inside the organization. Often they are also concerned with solving today's problems and occasionally yesterday's.

Conversely, those investments primarily concerned with external improvement or with innovation are usually looking outwith the organization's boundaries. They tend, also, to be forward-looking.

Second-tier motives

There some other motives, which I show as a hub. They include compliance with mandatory demands, improving infrastructure and making someone or some group look better.

Investing for compliance is to meet requirements such as audit or legal standards, or to fall in line with a dominant trading partner.

Infrastructure investments are those that improve a system's ability to serve most or all users. The benefits are not specific to a discrete section of users or to a particular task or process.

Image improvements are common. This is where an organization invests to impress. Occasionally these investments are to boost the image of a person or group but this motive is seldom owned up to. More often, there are business reasons for image improvement, such as indirect marketing or branding.

These three motives can apply to both inward and outward-looking investments, hence their neutral position on the diagram.

And the point is?

Briefly, self knowledge. I have used this model with groups of senior managers and directors. Before showing the diagram, I ask them to list their major recent computer investments. Then I invite them to tag each according to the primary motive. (That is, C, BI, BE, N, M [for mandatory], In[frastructure] and IM[age].) Multiple tags are frequent, which is fine.

I then total the numbers and put them on the diagram, by then revealed. Typically the left side gains by far the greater number of 'votes'.

This exercise has no statistical validity, as you have no doubt already detected, but it is not intended as an objective measure. (There's no pretend magic about these quadrants!) Rather, it is a mirror held up to the organization's investment habits.

Then what?

More often than not, the result comes as a surprise to the group. Sometimes there is resistance to what the group sees in the mirror. That's normal, too. It takes time for the truth revealed to sink in.

Typically, the next response is a request for a recommended ratio between left and right-hand sides. This is not possible to give - organizations and situations vary too much.

All you can say with certainty is that a zero score on either side is fatal. Having nothing on the right-hand side, for instance, would mean a complete lack of attention to market and customer matters.

Having nothing on the left would mean that no one is 'minding the shop'. Such an organization would collapse, sooner rather than later.

It's the stage after this that matters, when the group considers the implications. As people start to think about what they have discovered, they typically ask questions such as:
· Should the emphasis be changed?
· How does this compare with our competitors' investment profile?
· Should we start thinking about outward-looking matters?

This is normal and usually signals the start of a healthy debate on investment policy. It's an exercise worth repeating annually.

Getting to the truth

Beware a statement of investment purpose that is not easily or clearly expressible in terms of the seven motives. "To improve competitive edge," is a common example. This is waffle.

Question the person making the statement until he or she does define it in terms of the seven motives. If he or she cannot, or will not, then you should doubt the value of what you hear. Intentionally or otherwise, this person is purveying bovine ordure.

The principle is simple - clear language stems from clear thinking, which leads to clear action. By enforcing clearer language, you can induce that clarity of thought or confirm its presence (or, indeed, absence).

The relevance to social networking

This is all very fine, you might say, but how does that help with introducing social netting to my organization? That's simple:

1. First, go through the motives exercise, on your own or with colleagues.
2. If the result is all or overwhelmingly left side, think seriously if it's worth bothering. Social netting is usually about outward and forward thinking. This is not always popular at the moment, with companies fighting just to survive.
3. If the result is better balanced or you think you can change minds, you will be armed with some cogent arguments for going ahead.

A bonus is that you can look at how other people have used social netting and translate their motives and experiences into this simple model. It's good for decluttering verbiage and for pushing aside the stuff you find on the floor of cowsheds.

We'll do some of that next time.