Enterprise 2.0

How to Manage Social Technologies to Transform Your Organization

Andrew McAfee

• Publisher: Harvard Business Review Press
• Year: 2009
• ISBN:
  9781422155141
• Topic: Business
• Subtopic: Gestione dell'informazione
• Index: Business

"Web 2.0" is the portion of the Internet that's interactively produced by many people; it includes Wikipedia, Facebook, Twitter, Delicious, and prediction markets. In just a few years, Web 2.0 communities have demonstrated astonishing levels of innovation, knowledge accumulation, collaboration, and collective intelligence.Now, leading organizations are bringing the Web's novel tools and philosophies inside, creating Enterprise 2.0. In this book, Andrew McAfee shows how they're doing this, and why it's benefiting them. Enterprise 2.0 makes clear that the new technologies are good for much more than just socializing-when properly applied, they help businesses solve pressing problems, capture dispersed and fast-changing knowledge, highlight and leverage expertise, generate and refine ideas, and harness the wisdom of crowds.Most organizations, however, don't find it easy or natural to use these new tools initially. And executives see many possible pitfalls associated with them. Enterprise 2.0 explores these concerns, and shows how business leaders can overcome them.McAfee brings together case studies and examples with key concepts from economics, sociology, computer science, consumer psychology, and management studies and presents them all in a clear, accessible, and entertaining style. Enterprise 2.0 is a must-have resource for all C-suite executives seeking to make technology decisions that are simultaneously powerful, popular, and pragmatic.

1

Introduction

Skinheads are behind this book.

Before I explain how and why this is, let me talk a bit about this book and its goals. It’s a book about how businesses are using a new set of technologies that appeared over the past few years on the Internet. To many people, these tools seemed so novel and important that they merited a whole new version number for the Web; Web 2.0 was created to describe them, and to highlight their impact on the Internet.

I coined the term Enterprise 2.0 to describe how these same technologies could be used on organizations’ intranets and extranets, and to convey the impact they would have on business. This book is devoted to that topic. It has four main purposes. First, it’s an overview and description of a bunch of new and (to many people) strange technologies and technology-based communities: blogs, Facebook, Wikipedia, Twitter, wikis, prediction markets, the PageRank algorithm, Delicious, social networking software, and others. It’ll describe what each is, concentrating not on its technical details but instead on what it’s used for—what tasks it accomplishes and what needs it’s designed to fill. If you’ve heard about these entities but aren’t sure what they are and what purpose they serve, these descriptions should be valuable.

Second, and much more importantly, I’ll show that these technologies are not simply a random assortment. Though they do differ in significant ways, they also all share some deep similarities, similarities that make them all part of the same broad trend. As I’ll describe in chapter 3, this trend is the use of technology to bring people together and let them interact, without specifying how they should do so. While this sounds like a recipe for chaos, it’s actually just the opposite; the technologies of Web 2.0 and Enterprise 2.0 have the wonderful property of causing patterns and structure to appear over time, even though they’re not specified up front.

Third, this book will illustrate how companies and other organizations are applying these technologies to critically important areas. I’ll use case studies, supported with both well-established theories and new frameworks, to show how and where the tools of Enterprise 2.0 are being deployed and generating results. These examples will show how leaders are applying new tools, new approaches, and new philosophies to challenges such as accurately predicting the future (in domains where traditional forecasting methods have a poor track record); creating, gathering, and sharing knowledge; increasing rates of innovation; locating answers and expertise; and identifying and solving problems more quickly. For most organizations that I’m familiar with, these issues are not peripheral; they’re central. I know that the subtitle of this book—New Collaborative Tools for Your Organization’s Toughest Challenges—is a bold one, but I honestly believe it’s warranted. The tools and techniques described in this book can help you with some of your most vexing problems (and I make that claim without knowing anything about your organization!).

The fourth and final purpose of this book is to provide guidance about how to succeed with Enterprise 2.0. As we’ll see, it is not enough simply to deploy the new technologies of interaction and collaboration and then sit back and wait for the benefits to accrue. That strategy will almost certainly lead to disappointment and failure. I’ll present a road map for success, concentrating on the roles played by business leaders—managers and executives outside the IT department. These leaders are the most important constituency for successful use of the newly available technologies of Enterprise 2.0; this book will reveal why this is, and how and where business leaders can most effectively intervene in order to gain access to the benefits offered by these tools.

Now, about those skinheads. They’re behind this book because they helped me overcome my deep initial skepticism about the new tools and the communities built on top of them.

I’m not a skeptic about information technology in general. I’ve been studying IT’s impact on how businesses perform and how they compete since 1994, when I started my doctorate at Harvard Business School. And one thing that’s clear from a large and growing body of research is that IT as a rule significantly enhances productivity. Technology helps a company do more with less. What’s more, IT helps companies keep doing even more with even less, year after year. In other words, it doesn’t just offer productivity benefits at one point in time, but keeps offering them over time.

This sustained benefit is due in part to the incredible rates of invention and innovation in the high-tech sector—the hardware, software, networking, and Internet industries. As part of my research I tried to familiarize myself with this fascinating sector of the economy. If I was going to try to understand how technology is consumed, I reasoned, I had better also understand something about how it is produced.

I came to two broad conclusions about the technology-producing industries. First, they are hotbeds of innovation. They turn out new offerings at an astonishing pace, many of which are profoundly novel and beneficial. My off-the-top-of-the-head list of important new technologies that have appeared just during my own academic career includes Web browsers, PDAs, XML, modern Enterprise Resource Planning (ERP) systems, RSS, the Blackberry, the iPod and iPhone, Java, wikis, and Google’s PageRank algorithm. Large and influential companies, many of them founded since the mid-1990s, have either generated or profited from these innovations. A quick list of such companies includes Amazon, eBay, Google, SAP, Oracle, Cisco, Microsoft, Salesforce.com, Apple, Facebook, and RIM.

Most of these technologies and companies were as distant as Neptune when I was an undergraduate at a very tech-friendly school (MIT) only twenty five years ago. Whenever I stand still and look back over the history of the high-tech sector, I am simply astonished at the pace and volume of innovation.

My second conclusion about this sector, though, is less positive. I’ve noticed that technology producers and the industries that surround them are at least as good at talking about innovation as they are at actually innovating. The vendors themselves carry on a constant monologue about their latest offerings, and about the even further advances that will be incorporated into their next versions. This monologue is echoed and amplified by a set of “helper industries” that include marketing and public relations companies, trade publications, and technology analysts. Without questioning the objectivity of any of these functions, it’s fair to say that none of them is really in the business of telling their audience, “There’s nothing new here” or, “Things are relatively quiet at present” or, “We believe that this trend is largely hype and can safely be ignored.” Instead, their interests are largely aligned with those of the vendors; they all have a stake in portraying the high-tech sector as ceaselessly interesting and innovative, and one that can’t be safely ignored even for a short time.

In the early years of the new millennium I found myself much less willing to accept this image of high-tech industries, simply because it had so clearly been wrong in important instances. Many of the key segments of the “new economy,” including consumer Internet portals and B2B exchanges, had collapsed entirely during the dot-com meltdown, and in retrospect the volume of uncritical enthusiasm and praise for these businesses seems bizarre. Similarly, the dire warnings in the late 1990s about the looming “Y2K crisis” were clearly overblown, often to the point of absurdity: the Wired magazine cover story for April 1999, for example, stated that, “Whatever the Y2K crisis turns out to be, it is already unprecedented: We have never before anticipated the simultaneous breakdown of a significant fraction of the world’s machinery … maybe, just maybe, a lot of things—say, most things—will fall apart. Contrary to what the Social Security Administration has promised, pensioners in the US won’t get their Social Security checks after all, but that won’t matter much, because we won’t have a financial system that knows what to do with checks.” ¹

As it turned out, the Y2K crisis was not averted because all companies fixed every line of code that contained a two-digit year; it was averted because there was not much of a crisis to begin with.

So I resolved in the early years of the millennium not to buy the tech sector’s hype, and instead to be skeptical of its claims of constant novelty. When I started to hear talk of “Web 2.0,” then, I was immediately on guard. The phrase made the extraordinary claim that a new version number for the Web was warranted—that instead of incremental improvements, a great leap forward had taken place, and that a new World Wide Web was out there.

“Oh, give it a rest, would you?” I thought to myself.

When I first started hearing “Web 2.0” I was studying corporate technologies rather than consumer ones, and didn’t really want to switch. In fact, I wanted to spend as little time as possible investigating Web 2.0 because I was so convinced that it was nothing more than a new marketing buzzphrase invented by a vendor or member of one of the helper industries, and that it was yet another example of the tech sector’s tendency to put old wine in new bottles. I felt I needed to familiarize myself with Web 2.0, if for no other reason than to say to my MBA and executive education students that they could (and should) ignore it. Essentially, I just wanted to confirm my jaundiced hypothesis and move on.

So I fired up Wikipedia and thought about which of its articles to look at first. By early 2005 Wikipedia was receiving large amounts of media attention, and was often held up as a prime example of Web 2.0. Which, I thought, made this the perfect time to watch it break down. I knew from my cursory reading that Wikipedia was a collaboratively produced, highly egalitarian encyclopedia. Virtually anyone could start a new article, edit an existing one, or reject someone else’s edits. I believed that although this approach was commendable in many ways, it was also doomed, especially as the number of people aware of Wikipedia mushroomed.

I knew enough about the history of online communities, both from my reading and from firsthand experience in Usenet groups, to know that they usually don’t scale well. This failing is especially true if they’re open to everyone and inherently utopian—based on the assumption that all members will work together with good will and in good faith. Reality is unpleasant to such communities because some people don’t work this way: they post spam, spew hate speech and other vile content, bait other members into endless arguments, and generally act in ways that decrease the value of the community for other members.

Even a small number of members who act negatively can greatly harm an online community, and most communities attract such members as they grow. The two most common responses to their presence are to appoint gatekeepers to review all contributions before they appear online, or to close the community, that is, to impose entry criteria and keep many people out. Yet I knew from my initial reading that Wikipedia had taken neither of these steps. It had remained radically open, even as it grew to be quite large and well publicized.

So in early 2005 I thought that Wikipedia must be breaking down in predictable ways. I visited the site for the first time with the goal of watching this breakdown take place and then moving on to other things (or, to be honest, going back to previous things). To accomplish this goal, the first word I typed into Wikipedia’s search box was skinhead.

I have a shaved head, but it’s not a political statement; I’m not a skinhead. In fact, I knew almost nothing about skinheads at the time. I had heard, though, that there are two broad categories of skinhead. The first is the type that most of us are all too aware of: the violent, racist jingoists, often neo-Nazi, who stomp on immigrants in their leisure hours. The second category consists of people who have very similar haircuts and clothes (at least to the untrained eye), but exactly the opposite political philosophy; these skinheads practice and preach love, tolerance, and racial equality.

This surface-level knowledge of skinheads convinced me that the Wikipedia page devoted to them would be a great place to watch this online encyclopedia come apart. I thought that if hate speech and venomous arguments would be especially visible, nasty, and counterproductive anywhere, it would be on that page. I typed the word skinhead, hit “Go,” and sat back to enjoy the fireworks.

I was taken to an article that began, “Skinheads, named after their shaven heads, are members of a subculture that originated in Britain in the 1960s, where they were closely tied to the Rude boys of the West Indies and the Mods of the UK.” ²

Contents

• 1 Categories

1.1 In-fighting and Hostilities

• 2 History

• 3 Style

3.1 Laces & Braces

• 4 Music

• 5 Glossary of terms

• 6 See Also

• 7 External Links

The article was over twenty-five hundred words long, and although in places it was roughly written and edited, it was the best short summary of all things skinhead I had come across. It was concise, informative, objective, apparently thorough, and extensively referenced—everything a good encyclopedia article should be. Nowhere in the text of the article did I see arguments, hate speech, or flame wars break out. Instead, I saw Wikipedia working as advertised in an area where I had expected to see just the opposite.

After I finished reading the article, I said to myself, “There’s something new under the sun here” and began to suspect that Web 2.0 was in fact not just blind hype—that it was in fact useful shorthand for what was then taking place on the Internet.

However, I’m not interested in the Internet for its own sake, and my research doesn’t center on the Web, virtual communities, or online business models. I’m fascinated by the Internet, Moore’s Law, Metcalfe’s Law, and the Network Era (who wouldn’t be?), but I’m even more interested in how companies in “boring” industries deploy and exploit technology to do exciting things—things that make their executives and shareholders happy. In short, I’m more interested in how technology is consumed than in how it is produced.

My research also doesn’t focus on entrepreneurs, venture capitalists, coders, or CIOs. These are all vitally important constituencies in the tech sector and I interact with all of them. I’m most interested, however, in what technology means for line managers, those people responsible for developing valuable offerings, getting them out the door, and getting paid for them. These managers have frequently been left out of IT discussions, which in my view is a serious mistake. I believe that general managers are the single most important constituency for technology success or failure within an organization; yet very few books or other materials are written especially for them.

This book is an attempt to fill that gap. It summarizes the work I’ve done over the past few years to understand what recent developments on the Internet mean for corporate intranets and extranets, to describe the exciting new capabilit...