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The benefits of using Web 2.0 technologies within the enterprise are now well defined, but adoption has still been slow

After a few years of cautious examination, the enterprise IT community finally got the measure of social computing in 2008. But as Information Age’s Effective IT Survey shows, widespread adoption is still some way off.

Back in late 2007, most of the discussion around the enterprise application of Web 2.0 technology still revolved around an information-centric view of IT. Blogs and wikis were seen as novel information management and communication technologies. Social networks as corporate tools rarely received a mention; examples on the consumer web were thought too immature to have any relevance to business.

Some 12 months later, the true significance of such technologies to commercial and public sector organisations is better understood. Taken at its highest level, when a group of people use Web 2.0 tools to interact with one another, the previously invisible shape of that group’s social structure soon becomes visible. This simple idea significantly expands the potential of computing.

Before social computing, large organisations had very little insight into the dynamics of information and knowledge transfer among their employees. The only available approach to managing that transfer was to impose systems and procedures on the workforce. Such is the subtlety of human communication, however, that to enforce inflexible procedures for knowledge sharing is to stifle it: small wonder such knowledge management initiatives are rarely successful.

Content management and knowledge sharing systems that include Web 2.0 functionality such as social linking, community editing and blogging tools enhance usability by mirroring user interface paradigms familiar from the consumer web. But they also build up a functional map of knowledge flow: who the domain experts within the organisation are, what the most frequently asked questions are, and where the answers lie.

US electronics retailer Best Buy’s internal social network is the textbook example. Its BlueShirt Nation allows employees to build a profile of themselves and interact with peers located in stores across the country. Although it is not a formal knowledge management system, members of staff use the network to share expertise and know-how with fellow employees that they would typically never otherwise encounter.

The same technologies can be applied in a marketing capacity. Involving customers and prospects in a community built around products and brands is proving to be a powerful way to maintain loyalty and engagement.  

Procter & Gamble is one notable leader here with its BeingGirl website. The social network provides an environment in which young girls discuss and get answers on many of the awkward topics that arise as they enter their early teenage years, with P&G introducing marketing material for its relevant products at pertinent points.

Slow adoption

Despite the crystallisation of the concepts behind social computing and the elucidation of some solid case studies – both of which were helped by Forrester Research’s critically acclaimed book, Ground Swell, published in May 2008 – widespread adoption is not yet a foregone conclusion, at least among the UK-centric sample of the Effective IT Survey.

The proportion of organisations formally adopting Web 2.0 technologies was up, from 24.5% in the 2008 survey to 36% in the 2009 data, but the number that planned to deploy them in the next twelve months was actually down – from 20% in 2008 to 18% this year.

That is despite the fact that the proportion of adopters that rated the strategy as either effective or very effective stayed the same (52%). This is perhaps because the benefits of social computing – enhanced communication, engagement, identity – are commonly seen as soft. With IT budgets heading south, the projects that do not come with a rock-solid return on investment are less likely to receive backing.

Pete Fields, eBusiness director for employees and corporate services at US high street bank Wachovia, has a different view. Far from having soft benefits, he says, social computing promises to help businesses overcome some the most serious challenges they face today.

Before his company adopted its current intranet, built around collaboration and knowledge sharing, it had no strategy in place to combat the ‘demographic time bomb’ it knew it had to face an acceleration in the proportion of its workforce retiring each year as the baby-boom generation hit retirement age.

As Fields observes, an enormous amount of company knowledge was about to walk out of the door, and Wachovia Bank needed to do something about it.

 “When I showed how blogs and wikis could capture that knowledge, [management colleagues] said, ‘Sign me up; at least we’ll be doing something’,” he explained recently.

Other big problems targeted by the bank’s Web 2.0-rich intranet were international collaboration and engagement among younger employees. And it was a chance to combat these problems that got executive buy-in for the project.

“Going for some quick wins is a viable approach, but nobody who matters will ever notice. If you aim for some of the big issues, the CEO will take notice,” Fields says.

There are two caveats to Fields’ comments, however. Firstly, the most successful feature of the project in terms of deliverable return on investment was its videoconferencing component – not exactly a Web 2.0 technology. Secondly, like everyone else in the financial services industry, the biggest problem facing Wachovia Bank was not an ageing workforce or employee engagement, but its exposure to toxic loans and the related credit crisis. Nevertheless, as Fields point out, benefits often considered ‘soft’ can have the greatest impact.

Infinite Scope

In September 2008, industry analyst group Gartner produced a wide-ranging document examining the impact of social computing on businesses and public sector organisations.

The first thing to note is that almost all corners of the organisation will be impacted; separate sections of the report include: “The business impact of social computing on CRM software, HR data, government, identity management, further education” and more.

Gartner’s predictions foreshadow wide-reaching implications of social computing.

They include, for example, the prediction that by 2010 more than 60% of Fortune 1000 companies will have websites with some form of community that can be used for marketing purposes. During the same period, the adoption of social computing software in IT operations will increase by 100% (albeit from a low level today).

By 2012, the information that employees provide voluntarily in Web 2.0 systems will outweigh mandatory HR data in both volume and value. But the research also found that the potential for success in social computing is matched by the potential for failure.

By 2010, Gartner also found, more than half of the companies that have adopted online communities for marketing “will fail to establish mutual purposes, ultimately eroding customers and company values”. And still today, the report found, “most companies are fearful or flippant of social computing”.

Perhaps UK companies are waiting for the terms of success and failure to be better defined and best practices solidified before formally committing social computing. But they may find that social computing adopts them.

In most organisations, it is likely that some employees are already using social networks to interact with customers and partners, and employee adoption can only be expected to grow. Understanding the dynamics of Web 2.0, and its impact on enterprise IT, is therefore not something that can be put off.