The relevance of Enterprise 2.0 in an economic downturn

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Moving towards our Enterprise 2.0 Executive Forum 2009, a key issue has to be how these themes are relevant to the most prominent concerns of senior executives. In short, how will applying Web 2.0 and mobile technologies in organizations save money, increase efficiency and productivity, increase market share, and build profitability?

A number of recent blog posts have squarely addressed this issue, and are important reading in framing why Enterprise 2.0 must be a top priority for executives.

Susan Scrupski, talks about Reality Check 2.0 in writing about what the members of the Advisory Board for the next Enterprise 2.0 conference in Boston are saying.

Mike Gotta of Burton Group says:

Some of the phrases I keep hearing: 1. Efficiency (cost containment/avoidance, streamlining, etc.) 2. Execution (all-things-lean, process refinement) 3. Effectiveness (process and people performance, measurable productivity) 4. Rationalization (of budgets, of projects, of platforms) 5. Governance and metrics to support the above. Operations (run the business) and investment to protect top/bottom line engines (grow the business) are still ok – transformation unless it maps into some of the above areas is more discretionary – a good strategist will not cut to the bone… but overall – it’s a run/grow the business more than transformation.

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some savvy execs will keep a portfolio perspective and still invest in some long-term areas and not slash things to the point that when the economy rights itself they are strategically behind but they (1) may not have any choice and (2) may not get broad agreement from their peers.

I absolutely agree that the first five points are fundamental to management today, and are what are top of mind for most executives. However I disagree that transformation is or should be discretionary. Mike also makes the point that even “savvy” executives are tightly bound by market and organizational constraints. Certainly short-term survival is paramount, but beyond survival, transformation is not an option.

Over the last month or two I have repeatedly stated in media interviews and keynotes my belief that the next year or two will bring a greater shift in economic structure than probably any other time in history. A sharp downturn combined with technology-accelerated shifts in industry structure will see a rapid rise in differentiation in company fortunes. The trajectories of winners and losers will become more pronounced than ever. As such, it is an imperative to transform organizations to take advantage of those shifts.

When I spoke at a recent strategy session for a leading technology company, they said some of my ideas could have been taken straight from their playbook. For vendors, it is essential to distinguish between those companies that are simply focused on cutting and sticking with the status quo, and those that recognize the possibility and importance of shifting how they work. Ignore the former and focus on the latter.

Building on this theme, Andrew McAfee of Harvard Business School, who spoke at our inaugural Enterprise 2.0 Executive Forum in February 2008, has written an outstanding post titled The Enterprise 2.0 Recovery Plan on what he would do if he were put in charge of IT at one of the struggling US auto makers. He lays out a high-level plan, guided by the following principles:

• The company ‘knows’ the answers to our questions.

• Most people want to be helpful to each other, and to the company.

• Expertise is emergent.

• People are busy.

• Weak ties are strong.

• The ability to convert potential ties into actual ones is valuable.

• Platforms are better than channels.

• Search is the dominant navigation paradigm.

• The mechanisms of emergence should be encouraged.

• Anyone can learn the new tools, but they need to be educated, trained, and encouraged.

Andrew goes on to say

“I’m confident that the biggest and fastest bang for the IT buck at a US automaker today comes from Emergent Social Software Platforms and Enterprise 2.0.”

Which goes to another critical point: Enterprise 2.0, implemented intelligently, can not only increase worker productivity and efficiency, it can also significantly cut IT costs. While executives are afraid of new technology initiatives because they think automatically think that significant investment is required, in fact very low cost platforms can potentially replace current very expensive platforms and services.

The topic of how emerging web and mobile technologies are relevant to the most pressing concerns of the corporate world merits – and will receive – substantial attention in the period ahead. This will be a key theme at Enterprise 2.0 Executive Forum.