Social technologies have, and continue to, radically transform the world of business. They have vitally enabled real-time information exchange, instant access to people and information, increased trust and transparency and allowed a number of organisations to enhance their business performance and accelerate their business models.
The term ‘acceleration’ in this context refers to the speeding up of important business processes around knowledge exchange and collaboration, through the use of technology. This technology being adopted by some forward thinking organisations is called Enterprise 2.0 (E2.0), a term originally coined by Andrew McAffee from Harvard Business School. E2.0 technology is challenging existing business models, and the benefits are just starting to be truly understood.
Initially, E2.0 was overlooked due to its association with social media tools like Facebook, MySpace and Twitter, and typically, E2.0 technology does include similar functions as these. but allowing enterprises to have more personalisation of their social tools. For example, people and information tagging, profiling, networking, blogs, wikis, podcasts, widgets and mash-ups are all tools which can be translated for the enterprise, not to mention prediction markets, crowdsourcing and ideas engines.
This great potential for business model acceleration is driving firms to invest in integrating E2.0 into their technology architectures. As a result, analysts predict an increase in the spending to reach $4.6 billion by 2013, with a 43% year on year growth, making it the fastest growing technology in the enterprise software industry[i]. If this is the case, why are so many organisations excluding themselves from the E2.0 benefits of real time, flexible, integrated and highly informed business tools?
Acceleration in Practice
Two interesting – and completely different - examples of organisations successfully adopting E2.0 are DirectGov and Kew Gardens. DirectGov, the UK Government’s website used by members of the public as an information source, has built a strong culture and team structure around E2.0 in order to accelerate their business model. Through the DirectInnovate forum: http://innovate.direct.gov.uk, DirectGov has adopted a key concept of E2.0: the “Wisdom of the Crowd,” or crowd-sourcing.
This forum allows the developer community to submit examples of or ideas for innovative, citizen-focused applications (apps). On average, DirectGov receives 2 or 3 app suggestions a week. Of those, around 10 have been successfully developed and are being actively used, while many others are being piloted.
One of the most successful applications was the ‘snow information’ app, which enabled parents and teachers to update each other on school closures and weather patterns. Another recently developed app enables the reporting of hate crimes. Both these applications demonstrate how DirectGov has sourced additional knowledge and insight, support, resource and effort from beyond their own organisational boundaries, for the enhancement of their service.
The crowd-sourcing technology has provided DirectGov’s key business audience – the public - with a platform from which to voice their opinions effectively, and for communities to have some power in giving valuable information.
Kew Gardens has also accelerated its key business processes using E2.0. Kew Gardens is home to 250 years worth of vital information, underpinning worldwide research on plant diversity, conservation and sustainable use.
Kew recently decided to upgrade and invest in its fragmented IT architecture, using an E2.0 platform to ensure that future objectives could be achieved. The adoption of E2.0 has allowed the organisation to utilise ‘real time’ data for better-informed management decisions, which has fundamentally improved efficiency and effectiveness thanks to the ability to share information between employees and scientists instantaneously.
These two distinct examples highlight that leaders and IT professionals must acknowledge that social technologies can offer real enhancements to business performance, or risk being left behind. E2.0 technologies can improve the speed of the business processes and applications, reduce costs and time-to-market, and improve confidence in the information on which management decisions are made.
E2.0 facilitates co-operation among employees, provides a secure and managed collaborative environment for content creators, and encourages people to seek new and innovative solutions to problems. However, there remain some challenges that leaders and their organisations will need to consider when deciding whether or not to implement E2.0 strategies.
Possible Challenges for Strategic Leaders
We believe there are three possible challenges that leaders will face in implementing E2.0 technology. Firstly, leaders need to decide which E2.0 technologies make sense for their business needs.
With the variety of E2.0 tools available, each with its own potential benefits for performance, leaders will have to map their desired outputs before identifying, budgeting for and adopting E2.0 technologies through a strategic review.
Secondly, with a rising number of companies in the UK using E2.0 technologies, we should also start to see more companies training employees right across the business in order to make the most of E2.0. All new technology implementations require investment in training, and often a shift in culture. Companies will have to embed and embrace true global working to make the most of E2.0’s benefits, and allow networks to develop independent of geographic and organisational boundaries.
Companies will have to move to a ‘deliverables based’ performance culture, rather than a ‘be seen in the office’ culture, as business can be done differently when colleagues can be connected in real-time just as if face-to-face, but from different places.
Finally, some companies will resist adopting E2.0 technologies, despite the overwhelming evidence to suggest superior performance and acceleration of key processes in business models. In part, this is because the kind of adoption required is challenging to current best practices.
Some leaders will truly believe that their current organisational energies, practices and mindsets are going to be successful in the future, not recognising, or refusing to accept, that they must learn to forget the old ways to compete for the future.
With these tough challenges in mind, E2.0 technologies will be gaining momentum on boardroom agendas, strategy, and budget meetings in the years to come, but the business benefits are available for those willing to make the change right now.
Rachel Phillips is technology director, E2.0, Oracle, UK. Tazeeb Rajwani is lecturer, Strategic Management Group, Cranfield School of Management.