I recently did an interview with Jay Baer of Convince and Convert in which I discuss the impact of social media and networking within organizations.

Here’s an excerpt:

JB: There is of course relentless chatter about social media ROI and success metrics. Measuring social media is viable, but not obvious. Is the same true in adoption of new technologies? How should companies evaluate success?

PS: Great question. The ROI of many Enterprise 2.0 technologies can be relatively easily derived. For example, an organization that would have spent $5M over ten years on a traditional ERP or CRM application (bought from an on-premise vendor) may spend $1M on a SaaS alternative such as Workday or salesforce.com. Alternatively, an organization may use the open source LAMP stack and OpenOffice and save a great deal on software licenses. Note that open source does not mean free, however.

For other technologies, the ROI is a bit tougher to quantify. How does one easily put a value on better data management via MDM? What is the precise ROI of being able to understand your customer base better via business intelligence (BI) applications?

While ROI is important, a discussion of evaluating success and benefits is remiss without considering risks—that’s why there’s a chapter on enterprise risk management. Any new major enterprise technology endeavor introduces risk. However, many times not doing something is actually the bigger risk.

You can read the entire interview by clicking here.