5 Reasons VARs Should Care About Social Networking

Robert Scoble social networking

But unlike the boom-and-bust of the Internet economy in the late 1990s, the explosion of social networking start-ups in the past few years hasn't resulted in tons of cash being poured into non-revenue-generating businesses. Not all Web 2.0 concerns make money, but investors seem to have learned that it's a good idea to mostly pay attention to those that do. And while we tend to remember those heady dot.com days for the Tulipmania, the fact is a good many game-changing technologies and companies survived and prospered following the New Economy's famous crash.

No, not every last social networking widget that appears on Scoble's blog is useful or worth investigating. But social networking as a technological phenomenon is here to stay. Solution providers ignore it at their peril, and here are a few reasons:

1. Yesterday's toys are today's business drivers. DEC founder Ken Olsen is remembered today for saying in 1977, "There is no reason anyone would want a computer in their home." Intel, the world's largest semiconductor company, was at one time ridiculed as a "toymaker". And for all the preposterous ideas given funding in the first wave of Internet hysteria, companies like Google and applications like e-mail have literally changed how we all do business. Today, early social networking apps like instant messaging are vital to business communications at many firms. Human resource professionals and job recruiters are beginning to value online communities like Facebook as sources of information about prospective hires. That's only a small taste of how these tools are being used in business. Solution providers, who build the infrastructure and platforms upon which business information technology runs, should be aware that, increasingly, this means enabling the dynamic use of social networking tools.

2. Generation Y is invading the workplace. Call them Echo Boomers, Millennials or the Internet Generation, the cohort of young people joining the workforce thinks of technology differently than their seniors do. They bring with them a comfort with social networking that sometimes baffles older folks. According to the broad results of a 2007 CareerBuilder.com survey of 2,546 hiring managers and human resource professionals across all industries, Gen Y workers (defined as 29 and younger) communicate more through technology than in person, feel entitled to flexible work schedules, and expect to have access to state-of-the-art technology. There are two ways businesses might react to these findings. One is to attempt to force these younger workers to accept the corporate culture of older generations. The other is to make some concessions to Gen Y workers and even encourage them to build upon their social networking savvy in ways that enable better ways of doing business. Some 15 percent of the representatives surveyed by CareerBuilder.com said their companies were accommodating the Gen Yers in areas like flexible hours, telecommuting options, access to cutting-edge tech and providing company-paid cell phones and Blackberries. Expect the number of employers doing such things to rise.

3. Social networking can help your business, too. It's not just Generation Y that's getting value out of social networking tools. More older people are getting past their initial skepticism about hooking up romantically via online dating services like Match.com and eHarmony or keeping up with friends (and making new ones) on Facebook or MySpace. Millions have taken up blogging to communicate with like-minded people in disparate locations. While the initial surge in social networking has been predominantly about shaping our personal lives, the leap to using these tools to improve our work lives isn't a big one. Online communities are tailor-made for team-building within a company, particularly one with offices spread across various geographical locations. Social networking to generate new business and cultivate existing relationships is a no-brainer. So too is blogging, both to disseminate company information internally and to put a friendlier face on external communications.

4. With reward comes risk. When a technology sector blows up the way Web 2.0 is doing, there are plenty of opportunities for people to make money. Whether through direct investment in promising companies or early adoption of bleeding-edge tech tools, a little risk-taking can result in big rewards. The catch: It's very difficult to sift through the explosion of social networking products to determine what's got actual staying power, where it's applicable and who's making it. The solution: You've got to pay very close attention to this space if you want to play in it at all. Which, gulp, means that reading Scoble isn't such a bad idea after all.

5. With great power comes great responsibility. Because it's all so new, "social networking" is a catch-all term that covers everything from YouTube to political mailing lists. The rules for how to act within the various spaces that make up our social networks are being written as we speak. Concerns include privacy, free speech and even health, in terms of the frightening amount of time growing numbers of people are spending in virtual environments. Why is this a reason to pay attention to this phenomenon? Well, like it or not, social networks are only going to become a bigger part of our lives. And if you aren't in the game, you don't get a say in how it's played.