Enterprise 2.0 is a Crock: Discuss

by Andrew McAfee on September 2, 2009

Always-opinionated blogger Dennis Howlett put up a post at ZDNet last week titled “Enterprise 2.0: What a Crock.” I don’t agree, but I do commend Howlett for making a couple important points and raising a question that really matters.

One of his important points, to my eyes, is that:

“Like it or not, large enterprises – the big name brands – have to work in structures and hierarchies that most E2.0 mavens ridicule but can’t come up with alternatives that make any sort of corporate sense.”

I’d use the word ‘some’ instead of ‘most,’ but I applaud Howlett for pointing out that certain E2.0 enthusiasts adopt the language of revolutionaries. They rail against the old corporate order and proclaim that they’re working for its downfall. They portray hierarchy, standardization, and management as enemies of innovation, creativity, and value creation. And they maintain that E2.0 is an unstoppable force that will only gain power as Millennials enter the workforce and that resistance to it is, ultimately, futile.

All of which is both unhelpful and wrong. It’s unhelpful because such rhetoric has the effect of increasing resistance to E2.0 among people who really need to be on board. If you’re a manager within a stable hierarchy and you get wind of a movement that aims to eliminate management and hierarchy (and stability!), you’re almost certainly going to oppose it.

And it’s wrong because it’s, well, wrong. On two counts. First, management, hierarchy, routine, and bureaucracy have their faults, but none of them qualify as mala in se – things that are bad in and of themselves. Organizations should probably have less of each of them rather than more, but that doesn’t mean that they should have none.

Second, E2.0 is not an unstoppable force. All a company has to do is wipe ESSPs off its servers and block them at the firewall, and no Enterprise 2.0 will take place. And will that shortsightedness drive the company out of business in six months or a year? Almost certainly not.

I yield to few people in my belief in the power of emergent social software platforms, but they’re not the only game in town for achieving desirable business outcomes. I believe that over time companies that don’t use them will fall behind those that do, but how far behind, and over what time frame? Not that far, that fast.

Howlett’s other great point is that:

“[Organizations are] made up of a myriad of design, make and buy people who -quite frankly – don’t give a damn about the ‘emergent nature‘ of enterprise.  To most of those people, the talk is mostly noise they don’t need. They just want to get things done with whatever the best tech they can get their hands on at reasonable price.”

That’s so nicely put I’m not going to add anything except “hear, hear.” But I will revisit this quote later.

Howlett ends the post with his question-that-really-matters: “Can someone explain to me the problem Enterprise 2.0 is trying to solve?” I’ll give it a shot.

Here’s a set of business problems that are hopefully not too abstract or trivial, and ESSP-based solutions to them. They’re based on my research, casewriting, reading, and personal experience. This list is nowhere near exhaustive; it just contains the first few examples that came to mind.

Problem: How can we bring new hires up to speed as quickly as possible so that they become effective employees and stop bugging people with all their questions?

Use a wiki. Office supply company VistaPrint initiated a wiki in an attempt to capture what a new engineering hire needed to know. Because this knowledge base changed so quickly, the company felt that any paper-based solution would quickly become obsolete. Within 18 months the wiki grew to contain over 11,000 pages placed into 600 categories, all of them generated by employees themselves rather than a professional knowledge management staff. It became a dynamic and up-to-date repository of the company’s engineering knowledge.

Problem: How can we accurately forecast how many units we’re going to sell?

Use a prediction market. As Claire Cain Miller wrote in the New York Times Bits blog: “At a media company with a new product to ship, 1,200 employees predicted a ship date and sales figures that resulted in 61 percent less error than executives’ previous prediction, according to [prediction market vendor] Crowdcast. A pharmaceutical company asked a panel of scientists and doctors to predict regulatory decisions and new drug sales using Crowdcast, and they were more accurate than the company’s original prediction 86 percent of the time” The former example is especially impressive because the market demonstrated its ability to accurately foretell sales of a new video game, which are notoriously hard to anticipate. See these posts for more on prediction markets.

Problem: Who can solve this scientific problem that’s got us stumped?

Post it to Innocentive, an Eli Lilly spinoff and clearinghouse for scientific problems and problem solvers. Research groups within large organizations use Innocentive to post descriptions of problems they’ve not been able to solve. These problems are anonymized, assigned a solution value of between $2,000 and $105,000, then made available over the Web to the more than 80,000 independent scientists from over 150 countries who have an account with Innocentive. A 2007 study by Karim Lakhani, Lars Po Jeppesen, Peter Lohse, and Jill Panetta, found that almost 30% of 166 problems posted to Innocentive were solved.

Howlett asks “…can you imagine inserting a new process to pharma without FDA sanction? It would cause a hissy fit in Washington and rightly so. There is a reason why processes exist to validate what pharma wants to do. Can community oil those wheels?  Perhaps but I’ve not seen the proofs to suggest that is a long term win.” Innocentive has inserted a new process into pharmaceutical R&D, and I don’t think the clearinghouse has asked for or received FDA approval. Is it a proven long term win yet? No, but it has demonstrated some clear value.

Problem: How can we serve our customers better and more cheaply?

Set up an online community and let people help each other. As I wrote a while back, “an April 25 article by Steve Lohr in the New York Times that this is exactly what’s happening at Verizon. The article profiles Texan retiree Justin McMurry, who spends up to 20 hours per week at the community forums section of the company’s website, “supplying answers online to customer questions about technical matters like how to set up an Internet home network or how to program a new high-definition television.”

He’s not the only person exhibiting this strange new form of corporate altruism; Verizon’s director of e-commerce says that Mr. McMurry and his fellow volunteer ’super-users’ answer thousands of questions that would otherwise go unanswered (thus decreasing customer satisfaction) or take up an employee’s time (and thus cost Verizon). Discussions between customers and super-users also “provide customer ideas for improvements in hardware and software for the company’s fiber optic service, as well as a large, growing and searchable knowledge base online.”

Plenty of other companies, including SAP, Intuit and Dell, have had similar experiences. Howlett writes that “Business wants to find the most efficient ways of satisfying customers – and if you think that’s going to come from some new fangled community then think again.” Real world examples indicate that another round of rethinking might be in order.

Problem: Who can help me navigate through this huge company to find the document / information / resource / person / answer I’m looking for?

Set up discussion boards. Euan Semple wrote a great post about how he solved the above problem at the BBC:

“I can so well remember the frustration when managers would say “I can never find anything on the intranet”… I came to the conclusion that corporate intranet search was pretty much pointless. Not enough people created linky content so Google was out. Most stuff was static documents stored in “knowledge coffins” (hat tip to PWC for the terminology) that relied too heavily on structure, determined by someone else and without the benefit of context and lastly, with a few rare exceptions, once you found the document it was likely to be badly written, barely relevant and out of date!

… I came to believe that what people really wanted was to find someone who knew what they were talking about. Even if that “knew what they were talking about” meant knowing which document to read, why and where it was to be found. So what we did was start building online social spaces like forums, blogs and wikis in which highly contextual, subjective, complex patterns and information could start to surface about anything and everything in the business that was interesting and worth writing about.

The result was that when someone said on our forums “I need to find the official documentation on x because I am about to do y” they were usually rewarded, and very quickly, with multiple answers along the lines of “Well I found this document answered my questions because ….. ” pointing them at the documentation. Indeed increasingly the source they were directed to was a blog or a wiki containing up to date, contextualized information.

Having context in the question, context in the answer and the collective memory of your corporate meatspace, empowered by the mighty hyper-link, in between is hard to beat.”

Problem: How can we connect the dots among all the pieces of potentially relevant information about terrorist attacks and other intelligence issues?

Pursue Enterprise 2.0. In the wake of the 9/11 attacks, which highlighted poor information sharing among America’s sixteen federal intelligence agencies, ESSPs were deployed across all of them, including the CIA, FBI, NSA, and DIA (Defense Intelligence Agency). An internal report concluded that these tools, which include blogs and the Intellipedia wiki, are “already impacting the work practices of analysts.  In addition, [they are] challenging deeply held norms about controlling the flow of information between individuals and across organizational boundaries.”

Comments I received from analysts across the intelligence community (IC) reinforced this viewpoint:

From a DIA analyst: “These tools have immensely improved my ability to interact with people that I would never have met otherwise… Enterprise 2.0 tools have helped considerably in exposing new information, new projects, and bringing new thought leaders . . . to the forefront. People that would never have been visible before now have a voice. . . .”

From an NSA analyst: “Before Intellipedia, contacting other agencies was done cautiously, and only through official channels. There was no casual contact, and little opportunity to develop professional acquaintances—outside of rare [temporary duty] opportunities, or large conferences on broad topics… After nearly two years of involvement with Intellipedia, however, this has changed. Using Intellipedia has become part of my work process, and I have made connections with a variety of analysts outside the IC. None of the changes in my practices would have been possible without the software tools… I don’t know everything. But I do know who I can go to when I need to find something out.

From an NSA engineer: “ . . . there’s now a place I can go for answers as opposed to data. In addition, using that data and all the links to people associated with that data, I can find people who are interested in helping me understand the subject matter. Since I’ve been involved in Web 2.0 activities, I have met many new people throughout the IC. They are a great resource for me as I continue my career. Their helpful attitude makes me want to help them (and others) in return.”

From a DIA scientist: “IC blogs allow me to connect to people that I would not otherwise know about. I can see what they are working on, and use it to make a real introduction.

From a CIA analyst: “The first aspect that comes to mind when I contemplate how these tools have improved my ability to do my job is the ease of shar[ing] ideas and working collaboratively with intelligence professionals around the world . . . I am actively involved in an early stage project that would be impossible without these tools. The ability to link information and people together, as wikis and blogs do, makes possible an activity that I truly believe will transform our Community. The tools fundamentally altered the course of this project.”

A few paragraphs back, I cited with approval Howlett’s contention that workers care first and foremost about getting their jobs done. But I disagree when he writes: “[people] want to get things done with whatever the best tech they can get their hands on at reasonable price. That doesn’t mean some wiki, blog or whatnot.” The example of the US IC shows that in fact it can mean exactly some wiki, blog, or ESSP whatnot.

Problem: Is Andrew’s last name spelled McAfee or MacAfee?

Use Google to get it right, Dennis. It only takes a couple seconds.

If you know of other great E2.0-related problem and answer pairs, please tell us about them or point us to them via a comment to this post. I’d love to get a collection of examples that demonstrate to the open-minded that while Enterprise 2.0 contains a lot, it’s not a crock.

  • http://twitter.com/kmullins Kevin Mullins

    Here is another example of a problem solved with E2 from MIT:

    With the decline of the world financial markets last fall, MIT took a big hit on its endowment and established a Institute-wide Planning Task Force with the goal of reducing cost by $100-150 million over the next 2 to 3 years. MIT created a simple php application to help facilitate this effort which allowed cost savings suggestions to be submitted anonymously or with the author’s name. This open effort called the IdeaBank delivered over 1000 cost savings suggestions which where then condensed into 200 recommendations with 5 main themes. And now, after the Planning report has been published, the IdeaBank is still online and its focus is to provide feedback on the report and the process.

  • http://twitter.com/Greg2dot0 Greg Lowe

    I think perhaps that some strategies may seem rebellious, but in reality they are just the foundation for how many have achieved social participation; Take a strong “counter-opinion” as a way to start a conversation. How much attention do you get if you say “I have a new tool that is going to change the way we work.” vs. “I have a new tool that is going to crush Command and control and break down silos.” Sometimes it is sensationalism that gets attention…film at 11.

  • http://www.ddmcd.com Dennis D. McDonald

    You will never make any headway by citing facts and being reasonable!

  • http://twitter.com/jevharr James Harr

    The role of the E2.0 proponent (who is not the CIO) is to make ESSPs desirable to the masses. The millenials are already on board, so it is boomers and a section of phobic x-ers that are the obstacle. Andy, I agree with your assessment of the 'non-crockness' of E2.0, but we have a choir/preacher relationship. How do we go about demonstrating value (ROI) to users, managers and decision-makers?

  • http://www.gilyehuda.com Gil Yehuda

    I give you credit for addressing Dennis' dismissive blog in such a frontal way. It appeared to me that he was denying the obvious while obviously missing the point. (I commented at length “Denial is a river full of crocks” on my blog.) Facts have their place in a good argument, thanks for bringing them back to the conversation.

    When I was an Enterprise Architect at a large financial services company a few years ago, I leveraged many of the E2.0 tools to support my effort to lead a community of about a thousand .NET developers scattered in multiple business units. We set up communities, shared work-spaces, and developed applications in a socially coordinated manner leveraging the support of wikis, discussion forums, blogs, and a home-grown social networking platform. And this solved a pressing problem we had in the architecture group — how to lower the support costs of custom developed software by getting people to leverage common code that was:
    1. deemed supportable by both the Architecture group and Ops: because it had already been tested and certified for security, performance, and reliability;
    2. would meet the needs of the diverse groups who at first each said they needed their own way of doing things and were not very receptive to working with others; and
    3. would not incur any extra cost to any of the development groups who participated — since no one had extra money.
    We were inspired by the open source movement and by Enterprise 2.0. And we adopted both to meet the specific (cultural) needs of our (political) environment. What resulted was amazing cost savings (estimated at $6-10 million in the first year alone) with a total billed expense under $300K. Whereas we did not change the company, we did significantly change the experience of hundred of developers and dozens of production-deployed applications.

    We can play the game and ask “but is that really E2.0 or not?”. I don't see the point of that. I looked at the $10 million reduction in development expenses (a figure that we arrived via an independent firm that we hired to measure the process). And I looked at the 25 applications we launched on-time and *under*-budget that first year. Call it what you will, I call it “success”. I credit the proper use of social business tools that enabled me to influence a thousand people who did not report to me, and lead a team of 10 architects who had other bosses.

    This is one of many stories that we were able to recreate (at various scales, larger and smaller) within other groups in my company. And subsequently I found many peers in my industry who had similar stories about their experiences. However, most were not given permission to publish their case studies (enterprise behaviors have not totally changed yet, and some may never).

  • Salvatore Reina

    Good article. I have some sympathy with some of Dennis’s points, particularly around the unrealistic revolutionaries, but your article offers a reasoned view on why they should not be listened to. Like you, I am not sure how much of a game changer social software is, but I do think it will make a marked difference in the longer term to those companies that adopt it sensibly and in line with their way of doing business and making money.

    I would add that microblogging looks potentially very powerful. It’s been dubbed “river of news” in my workplace – no idea of it’s provenance, but a nice term. Properly bedded into existing systems, I think this is a useful addition to networking activities and would also aid expertise location.

    Btw, I think I was in that meeting with Eaun when the “Knowledge Coffins” comment came up (way bak in 06) – one of my colleagues, not me, but nice to see he remembered it.

  • http://mikelafleur.wordpress.com/ Mike LaFleur

    From my response:

    “If the sole purpose of Enterprise 2.0 was to enable social networking in the business environment, then it would be difficult to come up with a compelling reason to implement it in the current economic environment. But this is a simplistic view of Enterprise 2.0. Enterprise 2.0 is far more than creating communities; while the definition is still evolving, at its root Enterprise 2.0 conceptual and technological framework which provides agile and adaptable collaboration and information sharing combined with integration of enterprise data, presented to the user in one interface. It’s a little more that a forum.”

    You can read the whole thing at: http://mikelafleur.wordpress.com/2009/08/31/the-problem-enterprise-2-0-is-trying-to-solve/

  • http://twitter.com/jmcaddell John Caddell

    Andrew, great post as usual. I have a recommendation to add to the list of E2.0 problems.

    Problem: how does a company give its entire workforce the same window into information within and outside of the company that company executives, strategic planners and customer-facing personnel have?

    Answer: use a E2.0 application to collect stories, news articles, videos, Tweets, etc., that employees feel are important for their colleagues to be aware of. Readers use voting, commenting, posting related items, to add context to the data items. Significant items bubble up to the top of the viewing window, a la Digg. Executives can browse and search the archive to see what people are believing is relevant information for them. This information could illuminate weak signals, opportunities, threats, deep customer values, possible innovation opportunities, and many others. It can create a much better-informed workforce which will make better decisions and move faster to implement change initiatives.

    I wrote a blog post on this idea today (http://caddellinsightgroup.com/blog2/2009/09/a-…).

    regards, John

  • http://twitter.com/mariogastaldi Mario Gastaldi

    Andrew, I Iike very much the list of examples as to how E2.0 approaches solve specific business issues.
    I also agree with you, that there is no point in offering revolutionary ideas about hierarchies and how evil they are.
    This is not a simple topic, with no simple answer. Besides such a confrontational approach is likely to amplify the polarization in conversations taking place on innovation in Organizations through E2.0 approaches.

    At the same time I am missing some models or examples of ways to activate the cultural shift that is necessary in order to find a right balance between hierarchy and emergence.
    In this context Dennis Howlett's point: “Like it or not, large enterprises … have to work in structures and hierarchies that most E2.0 mavens ridicule but can’t come up with alternatives that make any sort of corporate sense.” could be worth listening to.

    I have been developing myself a model, (nice challenge), that aims to make the “Emergence of an E2.0 Culture” happen, and I might present it in San Francisco in a few weeks.

    At the same time I am extremely curious, and willing, to learn what others have been developing as to how to introduce/grow a suitable – E2.0 friendly – culture within an organization.
    I would love it if you could find some time to offer one, or a few thoughts.
    Thanks very much.

  • http://www.stoweboyd.com stoweboyd

    Actually, your first postulate, that management in itself is not evil may be wrong. Management is a necessary evil, and therefore companies should have only so much as is necessary.

    Peter Drucker spelled this out as the tension between the desires of the individual and the organization's desire for order. “Since all organizations require large numbers of people brought together [...], they all have the problem of balancing the objectives of the institution against the needs and desires of the individual. Each organization has the task of balancing the need for order against the need for flexibility and individual scope.” If the balance between these two is lost, management has failed.

    Drucker also sheds some light on the other inherent balancing act in the organization, between efficiency and effectiveness:

    “The efficiency approach insists that results will come automatically if things are done right, and therefore mistrusts any deviation from proper procedure. The effectiveness approach, however, points out that in any social undertaking, 80 per cent of the results are achieved by the first 20 per cent of the effort and that the remaining 80 per cent produces only 20 per cent of the results. Above all, the last 5 per cent of the results in any social activity require as much effort as the first 95 per cent.

    In the first approach, efforts are seen as central; in the second, results. In the first, the hallmark of good management is order. In the second, it is vitality. The efficiency approach sees administration as desirable and as the strength of an organization. The effectiveness approach sees it as a support, a necessary evil to be confined to the minimum needed to prevent collapse. The efficiency approach wants to make mediocrity capable of producing predictable results again and again. The effectiveness approach wants to liberate creative energy. This too is a realistic view of man.”

    I am on the side of the effectiveness crowd, and the goal of E2.0 is to push hard in that direction. The existing pre-Web and Web 1.0 tools and management disciplines are overwhelmingly oriented toward efficiency, but I think E2.0 is about Drucker's creative energy being liberated, at along last.

  • kferaday

    I think you allude to it in your “how do I navigate this huge company point” but providing a mechanism for sales teams to reach out to a broader audience (mostly internal) to support sales efforts is a great one. At my last company we used a wiki/blogs/file sharing to support sales efforts. This included competitive analysis, any intelligence gathered on prospects as well as being able to gather information from R&D to answer specific technical questions from customers that couldn't be answered in the field. This could work equally well for smaller, but distributed organizations. The only real roadblock I see in large organizations is still in discovery — especially for large organizations. Alot of these solutions need to focus on how they can improve/leverage search services to support discovery.

  • claudiap

    HM. I work for a big multinational company that probably employs mostly younger genX and older genY folks, with more and more genYs coming on board all the time. It is a tech company that considers itself very hip and cutting edge. Yet it is VERY hierarchical. I think this is *because* its workforce is so young, inexperienced, and in over its head. They fall back on titles and because I said so, and more often, because S/HE said so. When people don't have the confidence of knowledge and experience, they tend to rely on chains of command. Contrast with IBM, which is a long way from perfect, but has a lot more people who a) know what they're doing and b) come from type A, achievement-oriented backgrounds with cultures of excellence and therefore tend to assume everyone around them is the same.

    IBM also has a globalized infrastructure, where they don't care who is working from where, when, so it doesn't matter if you're there in person. What this means is, it also matters less what your title is and whether people play golf together and whether they've worked toghether before. What matters is whether what you just said on the phone or in your email actually made any sense. So this is where ESSPs really come into play, IMO. It's not about how hip, cool, etc FB and Twitter and wikis are. And it's not even about how easy they make it to share info, although that helps. It's more about the emphasis a company puts on *getting work done* and how they deploy *whatever technology it takes* to get that done. IBM realized it had teams all over the world that needed to work together. Different languages, different cultures, different time zones. What then did it matter whether you were in a given office, or not? So why not let people work from home? This isn't about making genY happy, it's about enabling a global workforce. If you have a to take a call at 5 AM to talk with someone at India, it's actually more efficient to do it in your pajamas than to get up, get dressed and drive an hour to your office. And guess what? That's better for business continuity too. No need to worry about a blizzard at headquarters causing everyone suddenly to work from home and crashing the dial-in servers. Intranet, good document management, great IM technology…IBM's been ahead for awhile on all that because *you need to do that if you've got teams all over the world.* And if you're talking to a jr product development person in India who has a great idea, are you going to bother to check what their title is? Did you even *catch* what it was? It's not that hierarchy doesn't matter, but it does get de-emphasized. One friend at IBM has never met her boss. He's in another state.

    Which isn't to say IBM is perfect. She also throws up every day because of the stress. Different issue, though. : So…move the conversation away from ESSPs per se, and from younger workers, per se. Just ask what's more efficient. What enables true teamwork? What wastes the least amount of time, my worrying about who you are and stroking your ego, or my having channels through which to deploy my expertise with the best possible outcome for the company? I'm not seeing how contributing to a 600-page wiki is necessarily going to help, to be honest. Sounds like just a more creative time-waster to me. But not having to worry about offending someone because you put a lower-down in the to: line of an email and a higher-up in the cc: line would be cool. Being able to make a logical argument for why a certain launch timing would be better than a dumb idea put forward by some 20-something who inexplicably is a sr product manager, and have that argument actually evaluated on its merit–that would also be cool.

    That's more how I would define ent 2.0–cultures that support and reward good thinking. I've been part of a few of those companies. I know they're out there. But it seems that with all the economic shrinkage and panic, there's been a narrowing of thinking and a return to older systems. This happens with individual thought patterns as well, so I guess I'm not surprised it happens with organizations.

  • dhinchcliffe

    Hi Andrew,

    I also responded to Dennis at length myself on ZDNet this afternoon:

    http://blogs.zdnet.com/Hinchcliffe/?p=744

    Thanks for shedding light on the topic, though I think Dennis throws up skepticism about things just to get conversation going. I do think it's smart at this point to touch on leading misconceptions, such as the overthrow of hierarchy (I think something more interesting and subtle is going to happen instead) as well as your excellent examples of use cases.

    I would only quibble with your comment that enterprises can shut down Enterprise 2.0 at will. The advent of mobile devices has ensured that this will not happen in all but but the most locked-down environments (i.e. secure government facilities). I think almost all organizations have to face social computing one way or the other and the longer they wait, the more work they might have to do. Though again, I'm encouraged by how non-disruptive adoption has been so far with the relatively fast inroads (both via grassroots efforts and formal initiatives) E2.0 has made, at least in terms of how accessible the tools are in the last year.

  • http://www.itsinsider.com itsinsider

    Hey. Just did a phenomenal interview with a large, well-known, Wall Street investment bank. Ironically (Den), it was the audit and compliance global organization that drove an e20 solution to answer an age-old problem: high inefficiencies and underutilization. It's an impressive global rollout that incorporates 5 financial center locations with the firm's subject matter experts in product, trading desk, regulatory, and banking. The initiative has yielded a “huge leap forward” due to the transparency and visibility the firm has as a result of breaking down the fiefdom walls that impeded the firm's progress in years past. Greatest challenge? The people issues. It forces employees to communicate more. Additionally, the new processes expose the weak links in the firm and threaten job security/relevance. Greatest benefit? The initiative answers to the Board of Directors and provides predictable, reliable reporting that mitigates risk and ensures regulatory compliance.

  • http://dave.kinkead.com.au Dave Kinkead

    The benefits of E2.0 will obviously impact organisations of varying degrees. While E2.0 wont be the best choice to solve every problem listed above, your first point – bring new hires up to speed – is one that all organisations can benefit from.

    Case in point, when taking over a new company last year that had a strong isolationist culture of ‘knowledge is power’, I launched an internal wiki to document policy and processes and made department heads accountable for ensuring content was loaded. This single action was in a large part responsible for a 50% reduction in the time required for new hire training and orientation which translated into an approx $10000 per head cost reduction.

  • Fred Johanson

    Enterprise 2.0 is certainly a crock from at least one key aspect. The term “Enterprise 2.0″ implies equivalency with Web 2.0 tools, which is far from the case. In fact, I struggle to think of a single Enterprise 2.0 tool which is equivalent to a Web 2.0 counterpart. If you were a hot shot programmer, would you rather work on the next feature for Twitter or the next iteration of SharePoint?

    A few examples from my company’s 3+ year Enteprise 2.0 experience:

    My company may use MediaWiki software, but it’s vastly inferior to the Wikipedia implementation. Our IT department certainly isn’t capable of keeping pace with the regular MediaWiki releases. You want a MediaWiki extension approved for your office wiki? Don’t forget your TPS cover with that request.

    A user that wants to use the non-sanctioned browser on the intranet? Forget it. We only do IE7 in these parts. So, yeah, you can forget those Laconica Firefox addons.

    It would be great if could upgrade to the latest blogging software. We use open source, but there are non-trivial costs involved with testing and security accreditation. So maybe we can squeeze some money into the budget next year to do it?

    Oh, yeah, and then there is that whole issue about blogging metrics. I need to somehow prove the blogs are generating value for the company, so that I can get that budget to upgrade the software. 1,000 people from across the company read 5 blogs on average per day, which means I should be able to get $K for a simple software upgrade. Three years later and those meetings are less-and-less fun. “Don’t come back until you can prove a blog resulted in 100 additional sales!”

    We also suffer from Enterprise 2.0 Shiny Ball Syndrome. We got the wiki up. That box is checked. Next! Hello, blogging. No one ever got promoted for making a wiki server a little more reliable or the tagging software a little faster. But hello enterprise microblogging! I am thinking maybe a nice holiday bonus with this one.

    Web 2.0 tools have become so vastly superior to their (ahem) Enterprise 2.0 equivalents that I seriously doubt widespread Enterprise 2.0 adoption will ever be achieved. No enterprise(s) will ever be able to keep pace with the unrelenting innovation taking place on the Internet.

    Our company lead users that should be building our mythical Enterprise 2.0 are in Parallel Kingdoms on their iPhones between Twitter sessions. I will put them up against your ESSP prediction market dream team any day.

  • http://twitter.com/JoeSchueller JoeSchueller

    I'm so glad you shared this. In my situation, I find the “fundamentalists” on either side of this argument so difficult to work with. Like anything in life, the truth lies in the middle. Emerging, egalitarian, networked solutions do not make 170 years worth of brand building and innovation processes and cause them all to be wrong. The key to this is trying to help people abstract information distribution (efficient in the 2.0 models) from decision accountability (what hierarchies can be good at).

    This is why I've never pushed my solution on anyone. We haven't had a “roll-out,” we've stayed in “beta,” we don't advertise, we're just there. We're not “deploying” this. We'll certainly advise and evangelize where it makes sense, but we won't push it on anyone. If you do, you incite all the arguments that end up in people concluding this is a “crock.”

    Much like you've done here, we've had great success when we stop talking about tools and start talking about work processes that could benefit from broader, more transparent, more robust interaction. Inevitably, the discussion becomes less about what's wrong with the tool or who's being disintermediated, and more about how much faster and better we'll be able to work.

  • http://www.kreeo.com/blog/sumeet Sumeet

    Thanks Andrew for a great post.
    I believe E2 can revolutionize the way we work and share in the knowledge economy. The biggest competitive advantage for businesses comes through better productivity an innovation and these are the aspects E2 must aim at enhancing.

    Technology, unlike in the past, must be applied as an enabler. There is no alternative to creating a culture for better adoption that doesn't mean we need to do away with hierarchies rather focus on relevant and secure access.

    We experience all the challenges mentioned while selling Kreeo in enterprise but our conversion rates are extraordinary because we have been able to address all the key concerns as summarized beautifully by you.

    I hope organizations don't repeat the mistakes committed in past and focus on outcomes and adapt to adopt a new trend. Focus on implementing solutions to harness the collective intelligence.
    I will be presenting my thoughts on the subject at the upcoming INTEROP, Mumbai conference.
    http://www.interop.com/mumbai/education/emergin

  • annemariemcewan

    What problem does E2.0 solve? For one thing, the technologies can be used to shrink social distances in workplaces globally distributed across eco-systems (suppliers, alliances, partnerships, fragmented business units etc), and taking the opportunity to change attitudes and working practices from silo mentality to collaborative. See http://chucksblog.emc.com/content/social_media_… for a great case study.

    In this era post-GM collapse and living through the aftermath of the global financial collapse, what other questions can we be asking? Solving problems are of course crucial but we do now have the opportunity to take stock of how things are done.

    For me, the focus of E2.0 is not primarily the technologies. It is the underlying business processes. I have been saying that the process-based forms of organising, typified by TQM, JIT, Lean, Concurrent Engineering and others, represent the first wave of smart working. Process integration, continuous improvement and problem-solving are all essential component of these process innovation and control methods, and they tap into the tacit knowledge of previously ignored shopfloor operators. These methods are nothing without the willing contribution of these people. Power to the people? I'll say.

    I see E2.0 as a label for the potential to reformulate business processes and business models into loosely connected, decentralised, peer to peer approaches to production within value networks that create economic and social value (Aspen Institute report, The Rise of Collective Intelligence, 2007 http://bit.ly/2Lzk6O).

    Building on what we know from the the pioneering process?based models of organising, social technologies in combination with reformed value networks and business models now create enormous potential for enabling a second wave of process and socially based smart working. Continuous improvement (CI) in the first wave is now Collective Intelligence in the second (CI 2.0 if you like).

    My views have been formulated through my doctoral research 15 years and subsequent recent monitoring of global workplace trends, I recently found Dennison, though, saying similar things in his prescient analysis of process-based forms of organising back in 1997:

    http://www.denisonconsulting.com/dc/Portals/0/D

  • http://twitter.com/DavidReinke David Reinke

    Joe,

    Great comment. I think you are right on. I started a 2.0 company by accident – I wasn't focused on revolution. I was focused on a particular business problem in a particular industry and stumbled upon the social web as a sensible part of the solution.

    I think there is a valid concern if more practitioners don't start leveraging 2.0 and creating real ROI stories, the “drum-beaters” may turn business leaders temporarily against e20 as another management fad.

  • http://twitter.com/DavidReinke David Reinke

    Maybe I'm over-simplifying, but I don't think E2.0 needs a “model” or a particular culture to take root in organizations – at least the way Andrew describes it. Rather, I think the E2.0 takes root in organizations that are performance based when it offers a superior solution to a business problem. It's worth noting that in my own business (a crowd-sourcing fashion demand forecasting company) I have never once internally or externally used the term E2.0. In regards to culture, we're consistently adapting our solution to work inside our client's existing culture vs changing a culture – let's give this thing a chance!

  • http://twitter.com/ejtweet Erik Johnson

    As an architect for an enterprise software vendor, I’m a big E2.0 fan and yet sympathize with Dennis’ argument (but not the arguing). Some constituents of E2.0 are clearly finding value today, which I’m excited about. But there are people who tend to get preachy about the urgency of E2.0, protective of how E2.0 is defined, critical of questioners, and (perhaps understandably) suspicious of software vendors. That noise doesn’t bother me.

    Social networking and other E2.0 features are actually relatively easy to buy or build, meaning the perception that enterprise applications vendors are too Jurassic to understand E2.0 is simply false. Also, it’s been pointed out (NYT: http://bit.ly/1GG0AG) that social networking grew fastest among people squarely in the decision-maker age range, which should dispel notions that the generation gap is a barrier to adopting E2.0 (although maybe a barrier to blind adoption).

    I see 3 things which impede corporate E2.0 adoption. First, social features have to incorporate governance constraints surrounding data retention, privacy, and security. Traditional role & function security mechanisms conflict with the free-form, opt-in, and self-service spirit of E2.0. Meshing E2.0 with existing access management is expensive and lacking best practices. Second, E2.0 hasn’t yet sufficiently differentiated itself from already widespread Web 2.0 and collaboration tools. Finally, enterprise applications (and their information models) need to be useful and fully-functional social networking participants. That goal is still pretty much unfulfilled, but nicely describes a good part of my day job.

    Nevertheless, enterprises and app builders alike are actively tossing E2.0 features into their efforts backlog along with other to-dos. But like many other useful technology initiatives, enterprises won’t push ahead unless they are good and ready. There is no need to make apologies for putting other priorities ahead of E2.0. Of all the possible drivers for implementing E2.0 or not, the one I don’t worry about is ignorance.

  • http://www.cubeless.com/ Tony Brice

    But Dennis Howlett is, by his own admission, a curmudgeon. I know many curmudgeons and they are ALL wrong about forward looking things ALWAYS. Pay no attention. Too many companies are already getting tremendous benefits, including significant cost savings, from E2.0.

  • Rick Ladd

    Dion:

    I agree the overthrow of hierarchy is unlikely and, while you haven't provided any detail on what that “more interesting and subtle” thing that's going to happen is, what I'm seeing in my very hierarchical aerospace company is a subtle shift in the method and efficacy of communication. I don't think strictly hierarchical organizations lend themselves to good communication. If it happens it's likely in spite of the methods the enterprise sets up to accomplish it. We are notoriously bad at passing information down, and few tell the whole truth when passing it up.

    With the ESSPs we are using and experimenting (gingerly) with, the hierarchy – at least with respect to communication – is slowly flattening and, as a result, also broadening. People who may never say a word otherwise are beginning to comment on conversations or blogs. Things that might never get said, e.g. criticism or our outward, customer-facing website, are starting to pop up. I find this a good and encouraging thing.

    I'm also inclined to agree with your second point as well. Working in what I would consider a very command-and-control, hierarchical organization that blocks access to social networks and personal blogs (very haphazardly, I might add), including Twitter, I nevertheless am seeing the writing on the wall for that kind of control. There are just too many ways to communicate, mobile devices (as you suggest) being the most obvious. A couple of years ago, phones with cameras were banned on campus. Guess how that worked out. Taking pictures is still verbotten, but everyone has a camera. We're expected not to take pictures of things we shouldn't be taking pictures of (like Kinetic Kill Vehicles on display in our Leadership & Learning Center).

    Which points back to one of those interesting and subtle things I think you're referring to. Trust. In order for E2.0 capabilities to truly flatten the hierarchy somewhat (again, at least with respect to inter-company communication and knowledge sharing), employees will necessarily be granted a higher level of trust than is normally the case. We just saw this happen when the President of our company announced he was ceasing to use the moderated blog he and his Executive staff had been using for about two years, and moving the conversation to a more social (and unmoderated) “site” which more closely resembled what I think of as a blog.

    Anyway, I am deeply grateful for both your and Professor McAfee's perspectives on E2.0, as well as both of your highly informative tweets. I have learned much and, by good fortune, have been able to transfer some of your knowledge to my company. All goodness!! Danke.

  • fidelman

    There are many use cases in the Enterprise today. I find most of the dissenters are the consultant or pundit types that have little to no connection with large or small companies. They are doing a service however in helping to surface the successes.

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    Very good article. “Like it or not, large enterprises – the big name brands – have to work in structures and hierarchies that most E2.0 mavens ridicule but can’t come up with alternatives that make any sort of corporate sense.” I totally agree with you.

  • setandbma

    Here is a collection of views that I have come across, on why Enterprise 2.0 will not work. I would love hear somebody countering these arguments!
    http://setandbma.wordpress.com/2009/06/04/why-w

  • petewild

    excellent ideas for using the crowd in the workplace which I had not previously considered
    I have a list of risks in not adopting enterprise 2.0
    http://www.petewildermuth.com/2009/08/21-risks-

  • http://twitter.com/chocoBRAIN chocoBRAIN

    Enterprise 2.0 is often times discussed starting from a technological point of view trying to meet business requirements with existing tools. Surely, technology can drive innovation BUT at the end of the day especially in the software industry technology has to support business meaning there has to be real value add! And a real value add can just be provided if you start with clarifying what are my objectives that I want to achieve and which tools can help me in achieving it e.g. more efficiently.
    The current web 2.0 tools are nice but not yet as far process oriented how it should be in enterprises. Google wave is a good starting point but there is still a lot of room for improvement. At chocoBRAIN.com we've started to left out all existing tools and just focus on how to achieve business goals by designing a process oriented web2.0 platform processes from scratch. We would love to get your feedback on it at CEBIT 2010 in Hannover where we'll present it the first time to the public. Or just contact us in February via twitter for a beta-user.

  • http://www.buytradebiz.com/ Business Opportunities

    Until Enterprise 2.0 folks gain a deeper understanding of the day to day reality of the Enterprise, this will continue to have a superficial impact on the Enterprise. If we look back at Enterprise 2.0 in 20 years and can see lots of Enterprise 2.0 “legacy applications”, we can consider this effort to have been a success.

  • http://muchosalsa.com/blog David

    The 2.0 Adoption Council consists entirely of “Enterprise 2.0 folks” who work in the day to day reality of the Enterprise across various business units scattered all over whichever Fortune X list you want to use. The deep understanding is there.

  • cdelumpa

    Enterprise 2.0 is as much about transformative business models as it is about technologies and tools. These transformations take time, require committed sponsorship across the organization (particularly in the C-suites) and are potentially extremely disruptive to the established organizational power structures. Note that these have absolutely nothing to do with technology. More likely, we're talking about tremendous organization development and design that not only has to be part of the Enterprise 2.0 conversation, in many cases it has to precede it to set these efforts up for success.

    I agree with Dion, that “almost all organizations have to face social computing one way or the other and the longer they wait, the more work they might have to do” and I am in agreement with the benefits of Enterprise 2.0. As in most technology projects I've been involved in (14 years at HP) the “soft side” of transformation usually comes after the technology nut's been cracked. the idealist in me is wondering if there are organizations out there that addressed both in parallel and found more lasting success.

  • ramana999

    Nice article. I like it.

  • http://twitter.com/JWilfong Jeff Wilfong

    Enterprise 2.0 is not necessarily about utopias. Web 2.0 companies “own” the information of the open-source communities. MySQL, FireFox, and other have been co-opted by larger interests. Facebook and other social networking sites will basically sell information.

    In a similar way, I think Enterprise 2.0 still has this top-down flavor. Management holds the reins of knowledge nets, and attempts to control the flow. Without this facilitation, the business would lose great value and chaos could surely result. The boundaries between outside the company and inside the company would melt and for all intensive purposes, the companies core knowledge would melt away as well. Management does not just control, but contains.

    Thus, management is exceedingly important, however, the structure of organizations, job roles/functions, and processes will invariably change in the coming years. How this will look, only time and innovation will tell.

  • http://www.sellbiztoday.com/ Sell Businesses Online

    In your response to “Problem: How can we accurately forecast how many units we’re going to sell?” you are absolutely correct. The more removed from the production, the more removed from reality execs become. numbers can't tell the whole story they never could.

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  • estetiks

    I think, Enterprise 2.0 can help: Better productivity and innovation. However, productivity will decrease when employees have access to Enterprise 2.0 tools.

  • estetiks

    I think, Enterprise 2.0 can help: Better productivity and innovation. However, productivity will decrease when employees have access to Enterprise 2.0 tools.

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  • http://www.sharepointpmp.com/ SharePointPMP

    Great post. Technology is a tool and it's only as good as you use it. The big issue is adoption, change, and culture. The technology itself doesn't solve these problems….it's easy to say “a wiki will solve the problem”. In many companies, there are people that don't know what a wiki is. You also have to encourage, educate, evangelize, mandate, align incentives to share. For example, you have silos of engineering teams. They use e2.0 to collaborate within their team, but not between teams and the CEO wants to know why and doesn't understand why engineers won't talk to each other and drive more innovation. Sometimes (well, many times) within the corporate world, if people aren't rewarded or incentives aligned to share, people don't.

  • http://www.sharepointpmp.com/ SharePointPMP

    Great post. Technology is a tool and it's only as good as you use it. The big issue is adoption, change, and culture. The technology itself doesn't solve these problems….it's easy to say “a wiki will solve the problem”. In many companies, there are people that don't know what a wiki is. You also have to encourage, educate, evangelize, mandate, align incentives to share. For example, you have silos of engineering teams. They use e2.0 to collaborate within their team, but not between teams and the CEO wants to know why and doesn't understand why engineers won't talk to each other and drive more innovation. Sometimes (well, many times) within the corporate world, if people aren't rewarded or incentives aligned to share, people don't.

  • http://twitter.com/milesahead Trevor Miles

    I’m really late to this discussion, but I am pleased to have found it. Hopefully my comment will rekindle the discussion and we will get some updated views and opinions.

    I’ll come clean: I work for a software company in the supply chain space.

    I found Dennis Howlett’s response to this discussion frustrating to say the least. But he may well be correct that the biggest barrier to E20/SocBiz – to me they are the same thing – is the existing organizational and power structures. Managers who have obtained power through the control of information and the dissemination of opinion are threatened by SocBiz, whether embodied in theories espoused by consultants or in technology espoused by software companies. As others have commented, this may be a very legitimate concern. But there is a great part in “The Big Switch” by Nichola Carr that discusses how our current corporate structures have resulted from a lack of rapid communication at the a time when organizations where consolidating and expanding geographically, much of the expension enabled by the advent of power utilities and the wide spread adoption of AC power.

    Dennis and I are roughly the same age so I hope he will relate to this anecdote, which is relevant to the entire SocBiz/E20 debate. In the early 1990′s I used to review research proposals for the then DTI in the UK. At some dinner I happened to sit across the table from the senior civil servant who ran the DTI and disbursed a large amount is research grants. I started talking to the person sitting next to me about the various word processing packages available at the time and their relative merits. As we were going through the various pro’s and con’s the civil servant interrupted us to say that if we worked for him he would fire us. When asked why that was, he said that writing letter was what secretaries did. We should be focusing on the content. We were just wasting our time on this technology stuff.

    Given the capabilities of the word processes at the time and the difficulty of transmission, let alone the ability to edit the document, across the enterprise he had a point. As does Dennis Howlett.

    Yet who would argue 20 years later that the virtual standardization around Microsoft Office has resulted in a huge increase in productivity? Now we have a whole generation that has grown up with PC’s and personal productivity tools, such as Microsoft Office, and gone much beyond that. If I want to get hold of my kids I use Facebook because they only check email a few times a week. And many people entering the workforce are so comfortable with word processes or spreadsheets that migitrating them to new ones is a reltively painless process.

    So yes, organizational and power barriers always slow down the adoption of new processes and the technologies that enable them (please note the order of the terms). As Dennis and others have pointed out, often for very legitimate reasons of corporate governeance. Does this mean the technologies, and technologists that promote them, need to be dismissed? I hope not.

    So a small challenge to those who dismiss technology adoption as a way of encouraging/fostering/forcing process chnage. Why not spend as much energy arguing against the conservative attitudes that prevail in business that prevent the adoption of more collaborative ways of working as you do about the relative merits of People, Process, and Technology versus Technology, Process, and People?

    Henry Ford supposedly once said “If I had asked people what they wanted, they would have said faster horses.” Thank you Henry for pushing your “technology”.

    As to the business value, let us consider the supply chain further. Outsourcing and off-shoring are financial instruments to reduce the assets owned by an organization. There is absolutely no benefit of operational efficiency that can be identified from outsourcing and off-shoring. Roughly at the same time as this original blog came out I wrote about discovering George Stalk’s original work on Time Based Competition. http://blog.kinaxis.com/2009/12/the-rules-of-response/ In a conversation just last week about B2B collaboration with Lora Cecere of Altimeter Group we agreed that anecdotal evidence points to the fact that the enquiry-to-quote-to-order lead time, all of which is information based, is still as long or longer than the order-to-delivery lead time, which is the physical manufacture and/or distribution of finished goods. George Stalk’s book “Competing Against Time” was published in 1990!! He message is still relevant and I believe the use of social concepts are key to changing the manner in which multi-tier collaboration is carried out.

  • http://twitter.com/milesahead Trevor Miles

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    Technology is a tool and it’s only as good as you use it

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