Enterprise 2.0

How can a company take advantage of Web 2.0? Does it make really sense to move to the new web paradigm for a profit company? Which are the real advantages? Which the risks and the drawbacks?

Every time a new technology arises, companies investigate about the possibility to make use of it in order to obtain some competitive or strategic advantage. So many companies are looking at Web 2.0 as a new way to make business. But is that a good idea?

Web 2.0 is not simply a new technology. Clearly it takes advantages of new protocols and applications, but in theory it is possible to create a Web 2.0 site by using old good HTML and some JavaScript. We should never mistake the objective for the mean. A good tool can facilitate a work, but it is not the tool that makes the work: it’s you! So, if you want to develop a Web 2.0 site, it would be better to use the most suitable protocols and techniques, but Web 2.0 is not a matter or appealing layouts and graphics, transparent text effects, colorful icons and fine cliparts, nor it is just a matter of aggregating stuff from different users. Web 2.0 is a new way to generate content and to provide services which takes advantage of collective intelligence, and it is mostly based on trusting and driven by common goals and motivations. It is about social networking, not necessarily profit. So, the key question is: "May social networking support business processes? Does it make sense for a profit company to take advantage of mechanisms that are based on sharing and collaboration?". Let us see the advantages and the potential obstacles.

Internet, intranet, extranet: many different ways for a company to communicate and deliver services. Business to business (B2B), business to employees (B2E), business to consumers (B2C), employees to employees (E2E): many different schemes and reasons to communicate. Where and how Web 2.0 may apply? Let’s focus on internal processes first, that is B2E and E2E. Intranet is mostly used to facilitate internal processes, to communicate with employees, to sustain communities of practice, and to provide HR services in general. So, Web 2.0 could be particularly useful for E2E initiatives, of course. Building communities of practices is useful to preserve intellectual capital even when labor turnover is high; it also facilitates troubleshooting and reduces the learning curves for new employees in case of job rotation within the company or across companies of the same group. However, if a company is based on rigid processes, strict rules and policies, as well as a well-defined hierarchical structure, Web 2.0 could generates relevant cracks in the system.

For example, there are companies where official communications between employees should follow a hierarchical path, that is, peer-to-peer communications are discouraged. In such companies a Web 2.0 approach is absolutely disruptive. On the other hand, if the management system is network-based and employees have some degree of empowerment, then professional communities could be a relevant resource for business.

Actually the issue is lack of control. In fact, the most efficient companies are used to have a strict control on internal processes and communications at any level, even on client platforms loaded on the employees’ workstations. A social networking environment is not really an anarchical one but there are not predefined roles, since it is based on natural leadership and reputation. Therefore, it would be no more the management to rate employees but the employees to rate each others, and it may happen that they will rate the management too. A totally different approach, and if a company is not enough mature for the change, introducing Web 2.0 inside a traditional system may take to critical situations.

In fact, social networking was born in the web, a place where nobody and everybody rule at the same time. The web is very different from an enterprise, and social networking is strongly oriented to collaboration rather than competition. In most enterprises employees are encouraged to compete, even because the basic structure is still more similar to a pyramid that to a sphere, even when matrix management applies. In social networking the basic idea is "you give your two-cent contribute and get back the million-dollar result", each one, not just the winner. There are no winners in a social networking systems or, if you prefer, all win. It is a full win-win environment. This could be very useful in a profit company too, but only if the company processes and rating system are enabled for a social-oriented approach. The risk to underestimate the potential conflict between a traditional enterprise system and a social networking approach is high.

The situation can be worst if you consider B2B and B2C channels. For example, you may want to create a media blog to publish your ads, so that people can watch at all your commercials and rate them. But what if rating is bad? Your initiative could boomerang on you. Moving to Web 2.0 means to stake ourselves, to risk our own reputation. It is true for a single blogger as well as for a big corporation. Of course you could prevent visitors to comment your ads, but that would revert your site to a traditional video gallery. So the lesson for a company is: introducing Web 2.0 implicates to lose control, inside and outside. Practically you gain in effectiveness by losing out in efficiency. Just like a pioneer, you risk, because you accept to play away a game, and you do not know in advance who are your adversaries and who your allies.

So, back to the question: "Is it worth for a company to move to Web 2.0?" The answer is "yes, it could", but if you accept to change your mindsets, your processes, the way you make business, the way you relate with your employees, your suppliers, and your customers. Web 2.0 is just like selling your products on the stalls of a local market, a big global local market. You will have to face directly your customers, you cannot use anymore the web to shield you from the marketplace. You get back to direct contact with people, so that anybody can give you an opinion and everybody can read it and your reply. Prepare yourself, because if this is your choice, it is only the first one, just the beginning. On the other hand, the return might be impressive. Whatever is the know-how inside your company, the know-how outside it is several magnitudes higher. Be efficient is important, but it is from innovation that you will get the key of your success. So, if you deploy Web 2.0 in the right areas of your company by continuing to use good and robust IT for performing well in traditional processes, you get the best of the two worlds.

But which are the right areas? First Research & Development, by sure. You can speed up your ability to solve problems and develop new products by ten or more times by involving people outside of your company, and it will cost much less. Second, Marketing. Who is better that people to tell you how people think and may react to marketing communications? Third, CRM. From pre-sales to after-sales, CRM has to be re-examined and re-interpreted by involving the customers in a social approach rather than a point-to-point relationship. Adopting Web 2.0 for B2B relationships, procurements, suppliers, business partners and agents could take to new innovative scenarios and give added value to the supply chain, but it is more difficult and requires a cultural change in all actors. Internally, the first area to involve is surely the HR, but the impact in the way people is measured and motivated could be significant. Here is not just a matter of introducing a new technology, but a new way to think your company. An area where probably is easier to apply Web 2.0 is related to the development of communities of practices, especially project managers and technical people, but also attorneys and managers.

You probably know that the keyword of Web 2.0 is BETA. Web 2.0 application and services are always in a beta stage of release. So, planning to be Enterprise 2.0 means to create a beta company. Change management will be no more an activity to perform once every few years when major changes occur: you will be always in a change management scenario, a continuous change that has to be continuously managed, your new BAU (business-as-usual).

Are you ready for that? You only know.