Last year, I wrote a paper about electronic social networks. In it, I pointed out some of the costs of inaccurate and stale information within organizations:

• Difficulty attracting star talent
• Problems tracking skills profiles
• Disengaged employees who resign in frustration

In different ways, each of these problems constrains business performance. During the last year, I've watched new Web 2.0 companies launch (some in my house), while others quietly languished. One of the most interesting examples, however, is Facebook. In spite of their youth, or perhaps because of it, they've done incredible things and have begun to transform the organization into as much a platform as anything.

In any case, the more I've thought about it, the more I think there are three key benefits to allowing employees to engage with one another using tools like Facebook:

1. It can help identify and close new business opportunities.
2. It enables employees (and their employers) to benefit from expanding networks of experts who may be consulted for their advice or encouraged to join an organization as an employee.
3. Analysis of the social networks that emerge within an organization can help inform discussion about the appropriateness of current organization design to the achievement of business goals.

The first two probably seem like foregone conclusions. It's the third idea that really keeps me stuck on this. Following a recent conversation I shared with David, I arrived at a couple of conclusions. First, some organizations are incredibly short sighted. Second, combining Facebook data with social network analysis techniques using something like InFlow could lead to some powerful insights into organization design effectiveness. Together, Facebook and InFlow could tell you how things really work – how information flows from one place to another – rather than how they should work based on the fancy divisional structure.

Given the powerful network effects exhibited by properties such as Facebook, and the walled garden inside which these platforms exist (at least until OpenSocial liberates the social graph), one thing companies should be quick to recognize is that if they are investing any more money than $0 in building their own version of Facebook or LinkedIn, they're making a terrible, terrible mistake. Instead, firms should focus on extending their own applications to benefit from existing networks that their employees, contemporaries and clients have already spent time cultivating. This is possible today and one nice example of it is the work being done by the people at Alfresco, who have created an extension for their terrific open-source content management system that:

By creating an extension to the Facebook platform, Alfresco benefits from the network effects (and the stickiness) of walled gardens such as Facebook and LinkedIn, simplifies expertise location and facilitates community building, and it does this while still allowing firms to retain control over their own sensitive/private information.