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I spent a great deal of time working on the Open Enterprise 2009 Research project earlier this year, leading up to the Enterprise 2.0 conference in Boston. I learned a great deal through the interviews with many thought leaders and practitioners, like Charlene Li, Euan Semple, Andy McAfee, Laurie Buczak, and Walton Smith, to name only a few. On reflection, I realized that in general the term Enterprise 2.0 was not used much, and no one spontaneously stepped forward with an impassioned argument as to why the term was even helpful.
Denis Howlett recently stated that Enterprise 2.0 is a crock, basically making the case that the knowledge management-ish arguments in support of E 2.0 don’t gibe with the way companies actually have to operate, what their drivers are, or what problems confront them. Andy McAfee responded with a not particularly brief or convincing response, stringing together a number of very narrow use cases — like bringing new hires up to speed, or internal prediction markets — and stating that since these problems exist, and since various solutions to those problems are being herded together as Enterprise 2.0ish applications, therefore Enterprise 2.0 is a good thing, worthy of our attention.
I think something more significant is at work, and those things called Enterprise 2.0 form only one bit of this bigger whole. The world in which work exists has changed fairly drastically in recent years, and so we are seeing a fundamental reset in the nature of work. On a secondary level, this translates into changes in how people communicate, coordinate, and collaborate, and this, then, leads to changes in information technology and related practices. Note, however, that talking about the secondary effects of these global business and social changes in and of themselves is, from my point of view, not a very illuminating exercise at the best, and at the worst, completely misleading.
In a way, you could interpret Denis’ polemic as making a similar point, but I don’t think that his perceptions are based on the sense of a sweeping change in the world of business, but rather the views that the timeless nature of business operations have nothing to do with knowledge management.
Howlett’s grumping is just some context for my point: ‘Enterprise 2.0′ is a not particularly useful characterization of what is going on with the spread of Web 2.0 technologies and practices in the world of business.
Note that I am a strong advocate for the use of the Web 2.0 handle, despite the various attempts by iconoclasts to topple it in 2008, or Arrington’s theory that a overpheromoned party of cool kids meant the demise of 2.0. I think Web 2.0 is fairly well-understood to represent a set of convergent and mutually supportive ideas — the Web as a platform, open standards, APIs, social tools, fast and low-cost development tools and techniques — that have come to define a generation of Web development and business.
Enterprise 2.0, on the other hand, does not have the same coherence. Perhaps this is because so many of the principles of Web 2.0 are blunted by the command-and-control needs of the enterprise. You cannot state that Enterprise 2.0 is Web 2.0 for the enterprise because much of what defines Web 2.0 does not easily translate to the enterprise context.
In particular, Web 2.0 as a phenomenon is strongly tied to social tools — social networking, social media, and so on — in which the individual is primary, and asymmetric networks of relationships with other individuals form the principal mechanism for connection and information flow. However, this does not gibe with the enterprise obsession with groups: where the rights and responsibilities of individuals are derived from group membership, and these rights are granted by the enterprise.
This apparently minor mismatch between the individualistic web and the organizational one desired by management leads me to believe that we are looking at the wrong end of the sausage machine. We need to switch our attention to the shifting nature of work itself, and how business needs to be reconsidered in a rapidly changing world (which includes a revolutionary social Web, notably). Toward that end, all manner of innovations, tools, and practices might be evaluated for their utility and impacts, but they cannot be considered hanging in space, in some sort of strategic vacuum.
First and foremost, management must settle on some principles around which work itself can be reworked. Difficult questions must be posed, and deep and principled thinking must take place before tactical software and business process changes can take place. In essence, forward-looking companies will devise something like a constitution and a bill of rights that attempt to lay out a worldview about the purpose of the firm, what it stands for, how it will treat its customers, what is expected from employees, and what the social contract between the company and individuals — employees and customers — is.
So, I have come to believe that this is the place where companies need to focus their attention: socializing the business, not adoption of Web 2.0.
I see that very smart folks in Dachis Group, Altimeter Group, and other upstart consulting firms are focusing on ‘Social Business’ as a defining theme, and I am lending my voice to that chorus.
In a time when we are shifting to a new, flow-oriented paradigm on information sharing and network-based coordination and collaboration, it might be fitting to focus on process and not its outcomes. Let’s leave the version numbering to one side, and accept the inevitability of reworking work into a much more social form. This will not be a one-time thing, but an ongoing and unending process of innovation.
In effect, we need to shift to a much more agile and adaptive way of thinking about social and collective action within businesses, and managing in a very different world than we were even a few years ago, back when Enterprise 2.0 might have seemed like a great term. Nowadays that term may be holding us back and confusing folks that haven’t been as close to the discussion as we have.
TAGS altimeter group andy mcafee dachis group denis howlett enterprise 2.0 social business
Excellent points. but ‘social business’ already has a meaning and that is for non-dividend / co-operative enterprises. Is this the correct connection we want?
I would tend to agree with Russell. The term ‘social business’ has been equated with the co-operative movement, fair trade, social enterprise and entrepreneurship in the UK and US for a number of years. Where social goals (who you employ, how profits are distributed, environmental practices, trade practices, local community engagement, ethics etc.) rather than solely working for profit is the mission for a company.
What is interesting is how many companies and organisations that come under this banner also use innovative social media practices that might be described as enterprise 2.0.
Not a problem…even Dachis (in spite of what I thought they were going to focus on) is still more focused on the customer-facing issues. Championing the needs of the customer is still relevant. But there’s still the context of championing the needs of employees to support the whole mess.
With that focus, I will continue to defend the purposes of E2.0
Very thoughtful post, thank you. I don’t have a new name to contribute, but I do think starting at the front of the “sausage machine” is a good idea — but I’d go even further. Yesterday I noted (link below) that education of individuals, as well as managers, may be a start. Many organizations have the flexibility provided by the tech, but the employees don’t yet have the skills to do the redesign.
http://www.terrigriffith.com/blog/2009/09/20/increase-pace-organizational-change/
I cringe when I hear that HR use case. It means that we can’t articulate the actual value of collaboration. E2.0, Collaboration, the social workplace, are about changing fundamentally the way we work together. From individualistic and competitive to team oriented and collaborative. From top down command and control to adaptive, responsive teamwork.
There are 2 use cases that I think help make the case here very well. The first is military and intel. These guys have GOT to get more knowledge and ideas hooked together, identify experts, trends and patterns, or they face mission failure. And they know that, get it, and are pursuing with vigor. THe other is high tech – the people who work there get it, and want the tools, and are going off the reservation in order to use them.
I’m with you – I thought Dachis was going to design businesses to communicate/run more collaboratively, but perhaps not.
@Rotkapchen really not sure where you get the idea that we are focused on customer-facing? You can’t do Social Business without factoring it in, but it is far from being our ‘focus’.
Ah, Jevon. Glad to engage. I’ve been asking the question for some time and can’t get the kinds of details/clues needed to validate your claim. All the clues seem Marketing focused.
Any artifacts to support your claim that I’m missing?
Happy to be a supporter/cheerleader, but need to see the right plays on the field.
@rotkapchen 2 our of our 3 practice areas are completely internal functions: Business Partner Optimization and Workforce Collaboration. Even the third practice area, Customer Participation is guided primarily by organizational re-positioning to better engage and iterate based on customer interactions.
Jevon: Thanks for that clarification. Those are the same clues that made me think the ‘promise’ would be valid. Just saying, I’m not seeing evidences of those plays on the field. For now, it still seems just “locker room” talk.
I’m still willing to be open minded and look for the evidences.
@rotkapchen happy to turn on the lights when the time is right.
Some of my thoughts on the new role of Enterprise 2.0 in the conversation from a few months ago: http://www.fastforwardblog.com/2009/04/19/understanding-the-role-of-enterprise-20-and-moving-towards-a-social-business/
Hi Stowe – Good post. Yes, for the last decade or more, leading firms have been transitioning from Coase’s TCE (transaction cost economics) to KBV (knowledge-based view.) They will inhabit and happily co-exist as the yin-yang enterprise of the future. While the transaction-process backbone is m/l stable, it is the social reorientation of work and wealth that is creating new strategies, tactics, operations, techniques and technologies. I would only disagree you notion of focusing on process versus outcome for social activities. For the social enterprise, outcome is what matters, not process. That’s where most two-point-whatever efforts fall down – badly. Cheers, John
Thought I’d throw my hat in this ring, as it was my post “Annoyed at ‘Enterprise 2.0′” – http://weblog.tomgraves.org/index.php/2009/08/18/e20-annoyance/ – that started off this cascade of ‘emperor has no clothes’ questioning.
Seems to me there are several things going on here: - an obsession with tools for tools’ sake, without much grasp of the socio-business context (the McAfee camp, so to speak) - usage within organisations of ‘Web 2.0′ tools _and concepts_, paralleling (and in some cases using) ‘social’ tools on the wider internet - IT-oriented concepts such as Cloud, Software-as-a-Service and service-architecture, forcing a rethink of enterprise IT-architecture and related issues (especially the risk/opportunity trade-off) - increasing recognition of the limitations of extrinsic motivators (external reward or punishment) – especially in ‘knowledge work’ – and the need for intrinsic motivators (finding meaning in the work itself (see e.g. Dan Pink at http://www.presentationzen.com/presentationzen/2009/08/rethinking-the-ideology-of-carrots-and-sticks.html ) - required changes within business to support a growing shift from products to services, requiring a fundamental shift in the way that organisations work (see e.g. WPCarey article at http://knowledge.wpcarey.asu.edu/article.cfm?articleid=1805 )
We need to be clear as to which of these diverse themes we’re describing at any given time. Using a overly-simplistic moniker like ‘Enterprise 2.0′ to represent all of them is asking for trouble.
We also need to be much more clear as to what we mean by ‘enterprise’. In the IEEE-1471 definition it’s social, not formal: ‘a group of people who choose to coordinate their efforts around a shared set of missions or goals’. In effect, it’s any subset _or superset_ of the organisation; more precisely, an organisation is a special case of ‘enterprise’, but not the only one. Which ‘enterprise’ do we mean in ‘Enterprise 2.0′? Worth thinking about a bit bit more carefully than at present, perhaps.
Stowe,
This is a really great post. I suppose I could come up with a logical way to list out rationale which supports some of the points you make about why the phrase Enterprise 2.0 is limited and, I suppose I could make a case for why I see the potential of social business, and social business design as a framework for solving complex issues brought on by shifts in how people work, live and use technology.
But I will offer up a more simple, gut level perspective. In 2006 I witnessed how powerful something such a personal publishing could be in terms of influencing opinion starting from scratch. In 2007, I immediately saw the potential of micro-blogging (Twitter) while most thought it was for sharing what you had for lunch.
In 2009, I have the same gut reaction when the concept of social business comes up. That there will be a need for a holistic approach which directly addresses how emerging technologies and human behaviors influence the ways businesses partner with each other, facilitate how their employees collaborate with each other and the way they engage with customers who want to actively participate.
At a gut level, I think these three areas will be profoundly affected as we are beginning to see. So now we have a few choices of words to describe how we take this on. Social Media? Enterprise? Here’s why I like Social Business Design.
Social (describes the relationship nature)
Business (targets the specific are which can benefit from these shifts)
Design (outlines an approach. This is a design problem. Existing systems are no longer viable and in need of re-design)
Anyway, take this for what it’s worth from someone who does not have a ton of “Enterprise 2.0″ experience. At a gut level, I think people will begin to see the problem differently over time.
Great post, Stowe. I think the semantic issues with using the term “enterprise 2.0″ can detract from the discussion of the effects of social software or collaborative technology (both better descriptors) upon organizations. Despite coining the term, I’ve been hearing McAfee and other shift to using that categorization, not least because doing so both avoids “2.0 fatigue” – and attendant versioning — but also because it frees dicussions to focus on the evolution of collaborative technologies in organizations in all sizes, along with relevant security, compliance & business performance concerns.
Great post Stowe and great commentary everyone. I’ve always had a problem with the term enterprise 2.0 mainly because it continues to reinforce the separation between the employee and the customers. Enterprises often complain about the silo’d nature of their organizations, and ironically Enterprise 2.0 is just a bigger silo :) Some time ago I twittered that I thought Enterprise 2.0 was a dangerous concept for this reason: http://twitter.com/karllong/status/1114694786
This, it seems to me, is the crux para:
“First and foremost, management must settle on some principles around which work itself can be reworked. Difficult questions must be posed, and deep and principled thinking must take place before tactical software and business process changes can take place. In essence, forward-looking companies will devise something like a constitution and a bill of rights that attempt to lay out a worldview about the purpose of the firm, what it stands for, how it will treat its customers, what is expected from employees, and what the social contract between the company and individuals — employees and customers — is.”
Do you have examples of companies you’ve seen doing this? In lean times, it seems like corps are mainly reactive, putting one foot in front of other… IBM is a good example of a company that talks the talk…does a lot of great thinking and white papering on this topic, and even has the technology in place and on some teams does a good job of forgetting about hierarchies…but I am watching friends who work there, and in the end it’s still a fear-based environment where the threat of layoffs looms, where people throw up before they go to work bec of all the stress (fewer people doing more work), and where people are asked to train new crops of cheaper managers to take over the jobs of their friends… I see people in most organizations logging in over Christmas, working late into the night, sobbing to me over the phone over their projects, letting their gym memberships lapse… Doesn’t seem likely to change just because of cool new tech, if anything it’s getting worse. Same fools are in charge. I think in most companies people get promoted because they have family situations that enable them to work longer hours or they’re more ruthless, not because they’re the smartest people or have the best ideas–so you aren’t going to have the most principled or sharpest people at the top. I am just feeling ready to SEE a little more action here.
It seems to me we had it much better during the dot-com era, when doc-sharing, flex time, remote work, transparency, etc were a given, before all these “new,” supposedly GenY ideas came on the scene. I always got a workout in and got my work done in about 40 hours back then, with occasional longer spurts. No one hesitated to ask a hard question during a company meeting, and everything was open book. Seems like Shangri-La, looking back. Yeah, dial up was slow, and ICQ had that dorky flower, but who knew? It all worked fine relative to everything else, and we were sane. And I got paid the same as I do now!
So whatcha got for me, version 2.whatever?
Great blog, spot on
With regards to the Enterprise 2.0 fatigue, someone coined the term “social business” which I like a lot better. I’d leave out the word Design as that indicates this very phase at this very moment
We’re all becoming globally connected on and at an ever-increasing scale and pace. This will certainly affect business as we know it, and in my opinion force a re-evaluation of the role of traditional management, delivery and sales. “Power to the people” seems to be come a reality, I wonder what this will mean with regards to the traditional political model as well, in due time…
I’m comfortable with Enterprise 2.0, less comfortable with ‘social business’ . For a start, let’s tackle Dennis Howlett’ s criticism. Managers aren’t interested in the emergent enterprise, and the case studies are thin on the ground? Sounds like Business School culture to me, the cry of people with MBA’s who don’t want to think long-term, they want to know which management fad to apply this quarter.
We’re in a recession because not enough managers listened to economists like Paul David and Carlota Perez who were warning that paradigm shifts are decades long, difficult and messy. When a single Blackberry has more information processing power than NASA used to put men on the moon, you know that work is going to be organized differently, just as factories changed when they replaced the big steam engine at the end of the line with a hundred electric dynamos along the production line.
In that context, I feel that “Enterprise 2.0″ does a good job of signalling that we should think about how Web 2.0 impacts on running corporations, and how we might organize production differently.
But does it help to call this new stuff “social business”? Not really, because Ford and Carnegie and Watson and Courtauld, their businesses were social, too. What people are talking about today is something we might call Peak Hierarchy. It no longer makes any sense to have a separate class of people who manage, who supervise other people’s work and direct them around.
Nowadays, there are hardly any jobs for people who can’t think for themselves. We all have to be able to think for ourselves, process information, communicate well, collaborate with our peers, and improvise. It’s The End of Management As We Know It, (And I Feel Fine.)
Martijn: Design is the MOST important word in the phrase. Indeed, it is even more important because the typical way of ‘seeing’ design is the way by which you describe it — as a phase. This is erroneous (and is further denatured by many methodologies).
Design is the beginning, the end, the middle: it’s everything.
The significance of it, and the depth of its impact is but briefly alluded to in this piece that ties the critical nature of complexity science to business organization http://bit.ly/gWrBd
As well, it is more important that we grow into a deeper understanding of what Enterprise 2.0 IS (not what it’s purported to be).
This new presentation by Oscar Berg (@oscarberg) does a great job of illustrating the significance of the possibilities: http://twurl.nl/uu6nsw
Whatever it is, it’s a time of major change — toward organizational approaches that are fundamentally different from those that made sense for the past several centuries. We all know that technology is the critical enabler, but by no means a sufficient agent for change — particularly when we’re wrestling with practices and structures that based on deeply embedded and long-held assumptions. For example, many of our employment practices stem from a hundred years ago when businesses were competing on the basis of scale and cost; they embed an implicit trade-off between loyalty on the part of the employee (to the organization and the hierarchical manager) and protection and care. This assumption just doesn’t work in 2.0 world where performance-based relationships are key. And there are many other examples — the need to re-think the organization broadly seems clear.
But, what’s the best term for this broader organizational concept? I am not keen on “social business.” As Andy McAfee argues in his upcoming book, “social” is perhaps accurate, but it is also an unfortunate choice of word for the technology and certainly for the enterprise. In the business world, “social” just doesn’t resonate — and whether we like it or not, it connotes a level of frivolousness that doesn’t encourage business people to grapple with the serious challenges ahead.
I think something related to collaboration — the Collaborative Enterprise, Extended Collaboration — conveys business purpose more accurately. The application of 2.0 technology to business is about bringing ideas together, it’s about collaboration. The folks at nGenera, with whom I collaborate for part of my time, are using the phrase “Managing the Collaborative Enterprise” and having good success in sparking both the imagination — and the energy to act — of business leaders.
Hi – Here’s a rant on the same theme. http://bit.ly/2FIrBt -j
Tammy –
The Yin/Yang dance of tools and techniques has been discussed for decades in the context of business change. That’s not changed.
I am uncertain of your characterization of a ’2.0 world where performance-based relationships are key’ — that sounds like the last vestiges of industrial taylorism, where the individual is a cog in a machine judged only on meeting others’ expectations, and the company holds all the cards.
‘Social’ in this context suggests something different, namely that social connection, between people, should be the dominant modality for conceptualizing the workings of the business, not disembodied business processes. It has its toots in the rise of the social web — social networks, social media — and should not be considered frivolous: it is an earnest and apt term.
Collaboration has had its day. It was a byword of the ill-fated knowledge management credo of the 90s. Collaboration was about streamlining knowledge work through group-based tools: so-called ‘groupware’.
Social tools do not start with the group, however. They start with the individual, or as I sometimes say, ‘social = me first’. And then, these tools support connection through social relationships, not principally through groups. This difference may seem subtle, but like so many other revolutionary ideas, big things flow from small changes.
” ‘Social’ in this context suggests something different, namely that social connection, between people, should be the dominant modality for conceptualizing the workings of the business …”
Karl Weick, in his classic Social Psychology of Organising, does exactly that. He says that the double interact is “the stable component in organisational growth and decay”. An interact is where someone says or does something and I respond. Their reaction to my response is a double interact.
Social flows of human intractions, networks of double interacts, are made transparent by social technologies, geographically distributed and connected online by location-independent working, and are breaching multiple boundaries – including national, organisational, cultural, demographic and professional.
“it might be fitting to focus on process and not its outcomes” – I think both; one implies the other.
Hi Stowe -
This is a great conversation and one I struggle with a bit because I hear so much of the Enterprise 2.0 chatter being around the technical architectures of the social applications being deployed. I don’t think that fans of the term necessarily want to limit the discussion to and yet, it keeps being discussed in more IT-centric circles.
I am a firm believer that we are moving toward more networked organizational structures. I am a strong believer that structure and incentives drive employee (or partner/customer) behavior.
Just like the Internet changed information structures from hierarchies to networked, it is now driving the same in human organization structures. The people who understand how the web changes information exchange have a generally better grasp on how you might change organizational structures.
I started calling this the Social Enterprise/Social Organization toward the end of 2007 (see my IDC report The Social Enterprise: How Social Networking Changes Everything). But ultimately, the semantics don’t matter… the structure, management, business process, leadership, measurement and cultural changes do. So, not sure where I come down on what we should be calling this but we do need to communicate that it is much bigger than just one aspect of a business.
This is the best post I’ve seen on this subject (other than my own!).
I agree with all your points as far down as when you suggest that it might be fitting to focus on the process and not its outcomes.
I think this would be a hugely dangerous approach (in terms of its potential to take us down various blind alleys.)
My diagnosis is slightly different – it was the original outcome that was wrong ie the outcome isn’t the use of social media.
In my blog, I suggest the appropriate outcome is the creation of social capital (so the social business is one that invests in developing social capital).
You’ll find the post here: http://blog.social-advantage.com/2009/09/my-further-thoughts-on-social-business.html.
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