Raymundo Rush: Why Hearsay Social's Clara Shih pushes companies to think digitally

Silicon Valley investor Marc Andreessen once opined that “software is eating the world,” a description suggesting that new age companies coming out of the technology industry are directly impacting businesses that have longed dominated the landscape. As startups either go public or receive extremely high valuations, their services are changing how capitalism and work is being done, something that has businesses unnerved.

Above: Hearsay Social CEO Clara Shih

Image Credit: Hearsay Social

With Facebook, Twitter, Twilio, Snapchat, Salesforce, Apple, Google, Layer, Uber, and other tech companies rising in popularity and capability, traditional companies (henceforth referred to as “incumbents”) find that their customers are becoming more connected and as such so should they. But that's easier said than done - lower-tier managers such as salespeople and social media managers get it, but what about those higher up, specifically in the executive suite?

This isn't a fad and incumbents need to take action, but perhaps they just don't know where to begin. Hoping to solve this and make it as painless as possible, Hearsay Social chief executive Clara Shih provides a hand-holding guide for companies looking into being more digitally-friendly in her new book “The Social Business Imperative.”

The age of the empowered consumer

Although the term “social business” originated with the onset of social media, it has evolved to be more than just having an organization on Twitter, Facebook, and LinkedIn. “Social business is a concept of serving a constantly connected consumer,” Shih explained in an interview with VentureBeat. “Some of the ways you serve [them] is on social media, while other times aren't.

“This is about modernization,” said Chris Heuer, a former social business leader at Deloitte and someone who has spent the past two decades consulting with companies on how technology and be used to empower individuals. “With the tectonic shift in the market of social media connecting the market and more transparency in society, you can't have business as usual anymore.”

This concept could be also defined as digital transformation, something many incumbents realize they've been slow to adopt. It's more than simply building a website so consumers can contact them. It's about being where the buyers are and relating to their needs. The era of “if you build it, they will come” is over.

“What we've typically seen are competitive dynamics that allow a market leader to become complacent, and when they get so big, there's this 'too big to fail' mentality for large organizations. The ultimate time they fail is when no one has to pay them for their goods and services,” Heuer remarked.

Above: Top reasons CEOs give for not participating in social media.

Image Credit: “The Social CEO: Executives Tell All,” Weber Shandwick Research, 2013

Shih has been one of the forward thinkers in this space, especially during her time at Salesforce. It was there when she became one of the first to develop a business application on top of Facebook's platform. “She saw no limits to the impact that social could have on business relationships,” reflected Charlene Li, the founder and CEO of Altimeter Group. It was during her time as a Forrester analyst that Li came across Shih's work.

It was the FaceForce app on Facebook and the success she generated from her first book “The Facebook Era” that propelled Shih to launch Hearsay Social as a way to educate incumbents on how to adapt to the digital world. Li cites two ways Shih has so far changed the conversation:

“First, she's created a company and product that enables this. Hearsay was an early player in the space, enabling widespread social engagement across an organization. Secondly, she's a thought leader and author, spreading the concept of social business beyond the reaches of her company. The two are inextricably tied together - it's the concept that social business lives throughout the organization - and isn't limited to a small group of people - that has been the core idea of her work.”

Shih describes now as the “age of the empowered customer” where today's buyers “can access information about your company, products, prices, competitors, and more, all on-demand. Never in history have business-to-consumer (B2C) and business-to-business buyers alike had as much power as they do today.”

A guidebook for business executives

For those that are in the trenches constantly exposed to social media and new technologies, “The Social Business Imperative” won't resonate that well. This book wasn't intended for you, but rather CEOs, vice presidents, directors, and those in the upper echelon of any organization.

Above: The nonlinear stages of the modern omnichannel customer journey.

Image Credit: The Social Business Imperative, Pearson Education Inc., 2016

Shih explained there are two insights she hoped people would find: The first is that there's an increasing divide between what goes on in Silicon Valley and how real companies operate - “Social Business Imperative” helps incumbents navigate through the noise and translate along the way. Secondly, it's to encourage management to work together with social media managers and digital marketers to guide the company to success. While some companies are deploying social business tactics, they're not seeing desired results, but this is because management has to own the strategy, not the people executing it.

After reading Shih's book, the expectation is that you will have a firm foundation about the social business space. She said that “if you know the lay of the land and the strategic framework, then you can do the research” to formulate how best to implement a digital transformation of your business. “Social Business Imperative” is meant to “demystify the overwhelming information out there” in the thousands of books filled with marketing jargon.

Although Hearsay Social focuses on financial companies, this 214-page missive is applicable to any business. There are sections detailing strategies for salespeople, marketing campaigns, customer service, security, mobile and commerce, connected devices, regulatory and legal compliance, information technology, and more. Rather than lecturing, Shih also includes case studies and anecdotes from companies like Disney, Lyft, Ameriprise, Warby Parker, Operator, WeChat, Wells Fargo, Intuit, L'Oreal, and Unilever.

Above: The four levels of social media maturity and ROI actualization from the Hearsay Social Business Maturity Model and Scorecard

Image Credit: The Social Business Imperative, Pearson Education Inc., 2016

Each section doesn't offer guidance on how businesses should think, but also provides step-by-step thinking on how to follow through on the advice. For example, when detailing how to execute marketing campaigns, Shih cites five key pillars: Have great content; Encourage distribution of that content through employees, customers, and influencers; Think mobile-first; Don't forget to analyze the data; and abandon campaign silos and integrate other mediums into the mix.

“The reason leadership has a hard time with this is because of a perceived loss of control,” Li explained. “I say 'perceived' intentionally because they actually aren't in control - when social is 'blocked' at an organization, employees simply go around the barriers to still connect with each other.” So whether it's through social networks, our smart devices, or new software and applications to make our lives easier, incumbents need to be prepared to adapt to them and find ways to relate to their customers.

Leading the charge for change

Shih's efforts both as an individual and as a representative of Hearsay Social has won her many fans, including Starbucks CEO Howard Schultz. In 2011, she was appointed to the beverage company's board of directors where she offers guidance on technology and digital strategy. At that time, Schultz described her as “a true technology leader” that “will bring fresh insight to our strong and forward-thinking Board. We could not be more thrilled about the social media expertise and ideas Clara will bring to our business as we continue to amplify the online experience and interactions Starbucks has with our customers, partners, and communities.”

To prove the point, Schultz wrote the foreword in “Social Business Imperative.”

A graduate of Stanford University and the University of Oxford, she has spent time working at Microsoft, Google, and Salesforce before teaming up with college friend Steve Garrity to create Hearsay Social more than five years ago. The company is not a consultancy or agency like with Buddy Media or Wildfire Interactive before both were acquired by Salesforce and Google, respectively. It's a software company that has an application facilitating engagement between businesses and customers through digital channels.

“Clara's success going back to her days at Salesforce has always been about translating technical possibilities to business value and conveying that in a very persuasive way,” Heuer said. “Hearsay does solution selling - you're not just getting the technology implemented, but it's configured so you can get the best out of it.”

“Clara cares about getting things done and building products and companies that work,” remarked investor Ben Parr. “She's not flashy and she's not looking for accolades. She's looking for customers and new hires and opportunities for her company. She's the best kind of entrepreneur.”

Bryan Schreier, a venture partner at Sequoia Capital, shared that what drew his firm to continually invest in Hearsay Social was Shih and Garrity. They all first met in 2010 and Shih and Garrity were “prototype entrepreneurs” Sequoia wanted to partner with. According to Schreier, “they had impeccable resumes, achieved a great deal in their careers, and were working on a company that's in a space where they're authentically spending their time and are concerned with.”

He added: “Clara had already written a book about social business and had real domain expertise…she's a rare example of a leader who's a thought leader in a space, and at the helm of a company that's blazing a trail providing incredible value to their customers.”

With these credentials, it's understandable to see the insights company executives will receive as a result of reading “The Social Business Imperative.” But while it lays out a pretty decent foundation to start with, the digital landscape is quite vast and this book doesn't touch on everything. However, that wasn't the goal as Shih told us - it's to help start moving things forward so companies can actually transform themselves into more modern entities.

“The Social Business Imperative” is on sale now.