Every so often, an unavoidable and pervasive shift takes place that affects every sector, every industry, every company, and every corporate function. Think automobiles, railroads, and information technology. And, now, think social media.

As social media use spreads beyond corporate marketing departments into sales, customer service, product innovation, human resources, finance, planning, operations, and the C-suite, it is transforming corporations and industries, creating a new source of competitive advantage or disadvantage for organizations depending on whether their leadership recognizes and embraces the change—or not.

This new source of competitive advantage is the social enterprise. Social enterprises are organizations characterized by their extensive use of social media tools, both internally and externally, and, more important, by the effect this über connectedness is having on them.

The dialog made possible by social tools is prompting companies to ask themselves: what would our business look like if we had a more collaborative relationship with our customers, employees, and other stakeholders? As companies put social tools to work seemingly everywhere throughout their organizations, they are beginning to answer that question, function by function. As they interact with a broader base of stakeholders, in unprecedented ways and with a frequency that has never before been possible, they are building communities, not just companies. These communities are allowing ...

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