DIGITAL MEDIA

There is surely no connected person on the planet who has not at least heard of the likes of MySpace, YouTube or Second Life. Their growth has been spectacular and they are making a very real difference to the lives of millions of people. Web 2.0 truly is a global, social phenomenon. However, less spectacularly but very surely, Enterprise 2.0 (E2.0) is now firmly on the rise.

Andrew McAfee, the Harvard professor credited with coining the term, defines Enterprise 2.0 as the “use of emergent social software platforms within companies or between companies and their partners or customers.” Put more simply, it means the use of an entire suite of emergent technologies—wikis, blogs, tagging and social networking tools—within a business context.

As an example, and perhaps surprisingly, according to Business Week, more than 50% of all employees at investment bank Dresdner Kleinwort regularly contribute to wikis. This fuels collaboration and communication to ensure that all team members are “on the same page” in terms of project management and calendars. This may seem like a simple application, but it has proven to be a powerful efficiency tool.

In the area of group collaboration, IBM holds so-called “innovation jams” where thousands of its employees are asked to participate in chat rooms simultaneously. The hope is that transformational business ideas will emerge. CEO Samuel Palisano believes the opinions of IBM’s 100,000 employees will result in “catalytic innovations” that can generate new business for the IT giant.

A related area that I believe may explode is enterprises harnessing the creativity and ideas not just of their staff but of their customers.

The example I particularly like is for Doritos corn chips. In the US, they ran an online competition to produce a 30-second TV advert with the winner being played in the middle of the largest annual TV event in the country – the Super Bowl. There was also a $US10,000 ($A11,900) prize.

The winning entry, which cost $US12 to make, was submitted by a group of university students aged 22.

What an outcome – the winners got the money, exposure to 100 million American viewers, and perhaps a billion globally, and Doritos got an excellent, prime-time advert for $10,000 plus set-up costs and 1100 more marketing ideas from the unsuccessful entrants.

These examples are internally led and managed. However, the power of Web 2.0 more broadly is that it transfers power to individuals i.e. your target customers. That being the case, you really should know what they are saying about your organisation and brands. The new corporate equivalent of “Googling yourself” is to go to the major social websites, and any blogs you can track down, and see just how many times your organisation is mentioned and the things that are being said about it. It can be a pretty sobering and eye-opening experience. If you have spent decades building and nurturing your brand – insert your favourite iconic blue chip here – you had better act on the things now being said about it in highly public, immediate and generally searingly honest, online forums around the world.

Another interesting high growth area is the intersection of Web 2.0 and Enterprise 2.0 such as social networking by professionals. Just as a MySpace, Bebo or Facebook derives its value from being a virtual meeting place packed with teenagers and twenty-somethings, equivalent business-based networks such as LinkedIn and Visible Path are highly attractive for the contacts they generate.

Companies now pay handsomely for targeted recruitment opportunities through individuals who can leverage networks of people with whom they already have an electronic connection (e.g. alumni or shared company history). Moreover, both sites provide a “bridge” to help members use their contacts to further business relationships that otherwise wouldbe inaccessible.

As of April, LinkedIn had 350 corporate members (from Microsoft to hedge funds) each paying up to $US250,000 to advertise jobs, identify experts and develop sales leads throughout its expanding network. Even back in the overtly social networks, the level of business connectivity is increasing all the time. By the end of August, Facebook had more than 6,000 registered global employees from my firm KPMG – all of them there entirely of their own volition. That’s a pretty attractive network to many different interested parties.

Given such figures, it is not surprising that many, if not most, E2.0 initiatives do not start from the top. They often emanate from small groups of relatively junior people. Consequently, a related positive outcome reported by some companies is that, if used appropriately, they help to break down internal hierarchies.

Of course in many organisations the adoption of E2.0 tools may face a variety of barriers ranging from people, culture and processes to the tools themselves. One real risk is not that wikis and blogs in particular will reveal too much information, but rather too little. Social networking requires a high volume of active participants and regular postings. Many wikis, blogs and virtual world presences fail due to lack of interest or diligence and if you don’t commit to maintaining them, it may be better for your corporate image not to start.

Yet overall, according to a recent McKinsey Global Survey, the clear majority of organisations embracing Enterprise 2.0 seem to report positive results and intend to increase their investment in the area.

Social networking and collaborative, digital software is transforming the definition of content, how it is produced and shared and how people work. In short, online interactions are replicating more closely the ways in which humans interact and collaborate naturally. If this is harnessed effectively and creatively, Enterprise 2.0 could fuel a burst of productivity every bit as effective as that driven by e-mail and Web 1.0 over the past decade.Malcolm Alder advises on digital media at KPMG. Parts of this article are drawn from Enterprise 2.0: Fad or Future?

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