On June 6, Larry Ellison–CEO of Oracle, one of the largest and most advanced computer technology corporations in the world– tweeted for the very first time . In doing so, he joined a club that remains surprisingly elite. Among CEOs of the world’s Fortune 500 companies, a mere 20 have Twitter accounts . Ellison, by the way, hasn’t tweeted since.

As social media spreads around the globe, one enclave has proven stubbornly resistant: the boardroom. Within the C-suite, perceptions remain that social media is at best a soft PR tool and at worst a time sink for already distracted employees. Without a push from the top, many of the biggest companies have been slow to take the social media plunge.

A new report from McKinsey Global Institute, however, makes the business case for social media a little easier to sell. According to an analysis of 4,200 companies by the business consulting giant, social technologies stand to unlock from $900 billion to $1.3 trillion in value. At the high end, that approaches Australia’s annual GDP. How’s that for a bottom line?

Savings comes from some unexpected places. Two-thirds of the value unlocked by social media rests in “improved communications and collaboration within and across enterprises,” according to the report. Far from a distraction, in other words, social media proves a surprising boon to productivity.

Companies are embracing social tools–including internal networks, wikis, and real-time chat–for functions that go way beyond marketing and community building. R&D teams brainstorm products, HR vets applicants, sales fosters leads, and operations and distribution forecasts and monitors supply chains.

Behind this laundry list is a more hefty benefit. Social technologies have the potential to free up expertise trapped in departmental silos. High-skill workers can now be tapped company-wide. Managers can find out “which employees have the deepest knowledge in certain subjects, or who last contributed to a project and how to get in touch with them quickly,” says New York Times tech reporter Quentin Hardy. Just cutting email out of the picture in favor of social sharing translates to a productivity windfall as “more enterprise information becomes accessible and searchable, rather than locked up as ‘dark matter’ in inboxes.”

Among the most promising (and heretofore least hyped) new social technologies are tools like Yammer (recently snapped up by Microsoft for $1.2 billion), which bring Facebook-like functionality into the office. Social-savvy employees post queries and comments to internal conversation threads and coworkers offer feedback, crowdsourcing solutions. Content can be shared and searched, so the same issues don’t resurface. Meanwhile, virtual groups offer a more interactive alternative than email or phones.