The timing was really quite extraordinary. I sat down to write this article about our recent webinar — all about social media and collaboration in the context of procurement — and as I started it, the notification about Microsoft's acquisition of LinkedIn popped up on my news feed. Microsoft has paid $26 billion, which is not bad for a business with a patchy profit record (at best) and that has seen a recent decline of 40% in its share price as revenue growth appeared to be slowing.
But this really indicates the day that business software providers stop seeing social media-type platforms as something intrinsically different from their day-to-day enterprise software products and solutions. That is in itself a consequence of changing individual behaviours. It is not just the millennial generation who are avid users of Facebook, Twitter, Instagram and the like — these are tools that are now used by people of all ages, and by people in many different jobs.
Now those tools, most of which were developed for individual or consumer use originally, are finding their way into business use, and that is why Microsoft has made this move. Organizations are seeing the benefits that social media platforms have brought in terms of better communication and (perhaps most significantly) improved collaboration. For firms and government sector bodies, the aim is to help their own staff to work together more effectively and then to develop more productive collaboration with suppliers and customers. Those are important goals for pretty much every organization, and this is where such tools can really help.
Microsoft is talking about driving engagement across LinkedIn and its products, such as Office 365 and Dynamics, although the idea is for LinkedIn to keep its own identity and still be run semi-independently. Not all observers are convinced, but we will see.
Meanwhile, other new firms are springing up, including SpendLead, in which three Spend Matters execs have made small investments. SpendLead allows buyers and sellers to find each other and link up in a very controlled manner, so procurement executives aren't bombarded by irrelevant information from potential suppliers but rather can access what is really interesting to them.
And of course the look and feel of SpendLead is very much in the social media, intuitive, easy-to-use category.
We will see other offerings — existing and new — addressing this general area of supplier and supply chain collaboration by using social media principles. It is hard to know which will make it through to the LinkedIn level of valuation or ubiquity, or whether the Microsoft deal will seem like a brilliant move or a disaster in five years’ time. But it is unlikely that Microsoft will be the last of the software giants that will look for an injection of social media capability and credibility.
Procurement executives need to keep up with developments in this area, we would suggest, and early adopters have the chance of driving some competitive advantage. If you are interested in the topic, you can listen to the webinar Jason Busch and I did a few weeks ago, The Sharing Economy And What It Means For Procurement And Social Networking. It’s a short, sharp 30 minutes, during which we discuss these and other related issues, and it’s available here (free on registration).