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Posted by Natalie Petouhoff on January 22, 2010
Consumer Business Group (CBG) — formerly Linksys — is a division of Cisco that offers a wide variety of consumer and small office voice over IP (VoIP) and networking solutions such as routers, switches, and storage systems under the Linksys by Cisco brand. CBG has long held a reputation for excellent technical support and has developed a number of innovative approaches to contain support costs while still offering responsive service. One key initiative was the introduction of an online customer support community. Before deploying the community, CBG developed a business case and confirmed that its customer service social media initiative would be a good investment.
How To Calculate a Business Case for Social Media What were the factors that they considered in constructing the business case? The company addressed four critical questions: 1) What is the impact on IT or project costs? 2) What are the business benefits? 3) What are the risks? 4) What success metrics will be used?
Costs: Generally there are startup costs and recurring costs when deploying social media.
Benefits: Benefits can range from improved brand sentiment to reducing customer service costs.
Risks: As with any technology deployment, there are risks. Those risks include: 1) reputation/ trust risks; 2) implementation risks; 3) measurement risks; and 4) scale risks. An example of reputation risk is the honesty of the communication required in social media.
Metrics: You’ll want to do weekly, monthly, and bi-yearly analysis to determine what worked and “what would be better if . . .” and make the changes to prove your business case. Analytics is a necessary tool that is often not part of the community platform.
At CBG, the key hard-dollar measure of its community success is the savings generated by call deflection. Direct deflection occurs when a user who would normally place a request for assisted support instead posts a question and gets an answer. Indirect deflection occurs when a user obtains an answer from the forum without having to post a question. Many customers find answers by visiting thecommunity and therefore do not need (costly) agent-assisted support. And a year after CBG deployed its support community, the company was able to discontinue email support entirely, with no negative reaction from customers, no increase in phone calls, and an increase in the community usage that almost matched email use.
As a result of this initiative, CBG decreased customer support costs through call deflection, strengthened assurance of business continuity, enhanced customer insight, and increased customer engagement.
For more details, here's the case study: Cisco Consumer Business Group Builds The Business Case For Social Media.
Other documents in this series...The first part of each listing is the link is to the Forrester Case Study or document and the second part of each title has a link to the story on my blog-- that way if you are not a Forrester client (yet ;-) ) you can see some of the results and start taking action!