Undeniably, the social network has forever changed and continues to change the manner in which people communicate, interact, collaborate and share information with their network of family, friends, co-workers, acquaintances, people with similar interests, etc. That’s in our personal lives, but how have social networking concepts impacted the way commerce is conducted and how will they continue to shape commerce in the future?
Business to Business (B2B) or supplier networks have been around for quite some time and they have been successful in various areas such as improving the efficiency and accuracy of transactions and providing easier access to existing and new trading partners. B2B networks leverage a common infrastructure to help enable more potential trading partners onto to a standard platform more quickly. There are, however, significant enhancements that these providers are now in a position to offer, enhancements that are drawn largely from the features and functionality of social networks.
To date, businesses have utilized social media and social networks for a variety of reasons but the focus has been primarily around engaging consumers (and, more recently around internal collaboration tools such as those from Jive and Atlassian), not other business and trading partners. The result is an extraordinary gap between the way consumers communicate, collaborate, and share information with each other and the way that businesses do these same things with other businesses that may or may not be in their network.
In the business (and, of course, the AP) world, the closest thing to social networks are B2B/eInvoicing/supplier networks (e.g., Ariba, Hubwoo, SciQuest and Syncada). In this world, we have already seen one business oriented network that was started and developed with the ‘social’ aspect in mind – Tradeshift. However, for the larger network players in the space their ability to integrate social features, capabilities and collaboration tools (especially with trading partners) into their offerings is likely to have an impact on future network and transaction volume growth.
Over the coming year we expect to see the introduction of such social and collaboration features being added to network offerings. Initially, the capabilities are likely to be around improving internal communication between functional groups (similar to Salesforce.com’s “Chatter” feature) as well as external communication with suppliers and other partners. Over time, however, we expect the capabilities to develop in a similar manner to those that social network users are used to, capabilities that will allow for much easier communication, collaboration and information sharing between a network of connected businesses.
As various ‘social’ features are introduced to a network of buyers and sellers, we will start to see B2B networks that are highly active from a social perspective (i.e., chatting, commenting, reviewing, rating, etc); it is also expected that these networks will begin to drive more and more transactional activity as a result of these ‘social’ capabilities.
This is the next evolution in business; the impact that social networks have is no longer going to be restricted to our personal lives, it is going to extend into the world of commerce and is most certainly going to have an impact on the way business is conducted. The next year or so will bring more intense competition from the major players in this market and some potential new entrants. Those providers that build a critical mass of trading partners will have an extraordinary opportunity to change the way that B2B business is done. What started at the end of the millennium and continued slowly through the last decade has picked up some good momentum over the last two years. As more enterprises join these networks, more opportunities for value will arise. It is still unclear what the “next generation” networks will look like, but they will most certainly take a page (or several pages) from social networks.
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