Enterprise 2.0 Will Never be Dial Tone

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Keywords: E20, ROI, strategy

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I’m sitting in a coffee shop in Toronto, midway through my trip here. I’ve had the opportunity to talk to former clients and potential clients, as well as account managers and product specialists at content management and collaboration software companies.

I’ve talked about a lot of stuff with these folks, from the U.S. Olympic Rugby team to large-scale scanning operations, from how awesome Toronto’s PATH underground walkway is to the future of teleconferencing.

But one constant through all of these conversations is the challenge of quantifying the impact of E2.0 on the organization. And, as you might expect, folks fall into one of two camps.

Two sides of the coin

The first feels that E2.0’s impact can’t be quantified any more than the impact of mobile phones or email can be—it’s dial tone, plumbing, part of the core fabric of what organizations do. And so trying to quantify what you get in return for investing in it is not only the wrong question in the first place, but damn near impossible to answer anyway.

The second feels that E2.0’s impact must be quantified—jumping on the E2.0 bandwagon without a strong business case derived from a clear, articulated vision of what you’re trying to accomplish is a recipe for disaster: either you won’t get the funding and organizational support for your E2.0 efforts or you will…and fail to make any meaningful, measurable impact on the organization.

Tails

As the title of this post declares, I’m in the second camp. For my money, organizations need estimate the impact of everything they’re considering doing; nothing should be done because we have to or because we can’t afford not to. To me, this is either laziness or an inability to get to the heart of the matter (or both).

I would argue that the things we consider dial tone or plumbing do have quantifiable benefits or we would have never adopted them in the first place. It’s just that on this side of the divide, they seem to be a natural part of the fabric of everyday business. But this obscures the reality of the path we took to get here, which required some sort of quantifiable impact to drive adoption.

Don’t wind up like knowledge management

And while I do think E2.0 will eventually be as (or nearly as) ubiquitous as things like email and cell phones at organizations, it will only happen as a result of E2.0 practitioners getting serious (and effective) about demonstrating what E2.0 can deliver to an organization—otherwise it will go the way of promising transformational fields like knowledge management: a groundbreaking idea that never adequately demonstrated quantifiable impact and so has enjoyed sporadic adoption across corporate America.

The final word

So that’s my stake in the ground—I’m excited to hear what you all out there think. Dive in and make the case for one camp or the other…or even dismiss the whole distinction as misplaced and introduce a better way to look at the issue: let’s get the conversation started!

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Comments

Chris Walker

I Agree

I agree that E2.0 won't be the "dial tone". I think E2.0 will be the collection of things (tools, culture, mandates, policies, etc.) that lets us use the dial tone. I see content, in all its forms, as the actual dial tone. I.e.: content as infrastructure.

As for not being quantifiable; pish!

E2.0 will include our email and cell phones (if it doesn't already). We'll end up with this Unified Communication thing.
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Joe Shepley

I like this distinction

Chris,

I really like the distinction between dial tone and what let's us use the dial tone...I'll have to steal that for a future post!

Thanks for jumping in and getting the conversation started!

Cheers,

Joe
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Mark D Bean

Twitter is the new dial tone :-)

Of course it's only ONE out of many channels an enterprise can engage their customers. My point is that you have to acknowledge this is going on out there - like it or not Mr. Grey Haired CEO. Now be a good CEO and help your workers deal with this. Good job.
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Joe Shepley

Or maybe the new busy signal? :)

Thanks for jumping into the conversation, Mark!
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Chris Walker

Old School

Not so much a busy signal as on old style party line.
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Lane Severson

The more you think about it the less it matters

I agree with you kind of. I think there has to be an ROI but I think the ROI is in creating a simpler UX and then it really gets back to being part of the fabric.

Enterprise 2.0 is not some completely different way of doing business. Ideally it should be a simplification of 1.0 technology. In the 1.0 world of phones and e-mail and file shares I had to go to several different systems to communicate and access documents. In the 2.0 world I should be able to see the documents I need began live chats with other users and even review previous discussions or wikis about similar topics all in one screen. All of those items are in the same place. (If they aren’t actually housed there it doesn’t matter, what counts is the simplification of user experience).

But, if this is true, if 2.0 technologies are basically a simpler way of conducting business and the ROI is in the ubiquity of the experience then why the rush to adapt? Why wouldn’t my business continue to work in our current state which is good enough?

I blogged a longer response for you http://tumblr.com/xho23d1uhg

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Joe Shepley

I sort of agree

Lane,

I like the way you approach the issue here (and in your great blog post)--a very fresh perspective on it that I think is mostly right.

However, I think you're downplaying the competitive drivers in adopting E2.0. No, Ford won't go out of business because it doesn't adopt E2.0.

But, speaking of Ford, adopting E2.0 sooner rather than later will gain you significant competitive advantage over your E1.0 peers. Ford is one of the leaders in E2.0, and I would argue that it's no coincidence that they are the only American automaker that's thriving through the downturn.

Is their adoption of E2.0 the sole reason for this? No. But is their ability to make cars that meet consumer needs better and to market them more effectively tied to their E2.0 success? Definitely.

So while I think that you're right that E2.0 is an evolution of E1.0, I would disagree that there's no rush.

Anyway, thanks for jumping in and sharing your ideas!

Cheers,

Joe
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Intangible assets' ROI ?

Personally I agree with what Andrew McAfee says in his latest book "Enterprise 2.0":

"I do not, however, advocate that decision makers should ask for quantitative ROI analyses, either before approving an Enterprise 2.0 effort or to assess its progress.”

To support this view, McAfee includes a quote from Kaplan and Norton:

“Improvements in intangible assets affect financial outcomes through chains of cause-and-effect relationships.”
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Chris Walker

Yes, but ...

The underlying assumption is that there will be an improvement to the bottom line. Any improvement to the bottom line is quantifiable and measurable.

I don't think that McCafee was advocating that organization chuck a whole mess of stuff into the mix and if it goes wrong, oh well.
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Christian Liipfert

It's pretty basic

Labeling something E2.0, or knowledge management, or whatever, can cloud rather than clarify the issue, although software vendors and consultants have done very well off that approach.

Good information governance practices are like any other housekeeping item - you either get it (and do it), or you don't (and you don't). It's pretty basic blocking and tackling. If someone requires an ROI and doesn't realize that this is part of a corporation's (and employee's) duty to its shareholders to properly protect the corporate assets, then it's a different type of software problem.

People will cut corners and be sloppy if that's allowed in your culture. Managing your information as an asset is nothing new -- successful companies and individuals have done it well for generations. Digitalization doesn't change that.

Agree with Chris Walker's comment about the combination of tools, culture, mandates, policies, etc., but add "ownership." Unless/until someone in the C-suite "owns" the information assets for the company, and is responsible for their proper management, don't expect the rest of the organization to get it. CIO's don't normally get this - they are more CTO's. There are exceptions.

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Joe Shepley

Getting paid to mow your lawn

Christian,

I agree that smart organizations "get" E2.0, information lifecycle governance, etc., and that they need to do it for reasons other than a financial return.

But there is something to be said for understanding the ROI of these activities even if this isn't the primary driver for doing them.

For example: I have to have utility service in my house, and I have to pay for that service, but there is still great benefit in using my smart meter to monitor my usage and change my behavior to lower my costs (i.e., achieve a return).

The situation is the same, I think, with E2.0, ILM, records management, and the rest of it. You *have* to do it, but there is an ROI in there nonetheless--and it's in the best interest of your organization to discovery what that ROI is and articulate it.

Thanks for taking the time to jump in and join the conversation!

Cheers,

Joe
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Christian Liipfert

Baisc, part two.

Joe:

I don't disagree with the concept of an ROI on information governance -- I've calculated it many times. I just think that going beyond listing the elements of that return (lower discovery costs, less reinvention, less searching, etc.) and putting a hard number to it has not, for me, returned on that investment (the time to generate a semiprecise number). The number will always be soft in many respects. It's like estimating an ROI on compliance with law or compliance with your code of ethics & compliance.

For me, a better measure is probably a comparison to what others in your industry are spending on it, all in -- a hard number to get to in itself.

But the business folks always ask the ROI question, so you have to be able to say something. Metrics are a good thing, but you need to have the measuring tools in place (your smart meter) before you can generate "real" numbers.

Christian
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