In an interesting twist, Ulrike Reinhard interviewed me about the Open Enterprise 2009 study:

A few weeks ago, during a busy two weeks in Europe, I interviewed J.B. Holston, the CEO of Newsgator. Despite the slight fuzziness of the video (I think J.B. needs to spring for a better webcam), his thinking was pretty sharp.

A few highlights:

• Newsgator has interated aggressively since last summer’s E 2.0 conference, where the SocialSites product was one of the finalists in the Launchpad.

• Newsgator has been focusing increasingly on integrated applications, making the company oriented more toward a platform strategy.
• The economy has had an impact on many segments that have been strong for the company, like financial services. However, even in that sector, there is a ‘harder times, so drive faster’ attitude that is leading to fast uptake in some companies.
• Large companies are finding it essential to integrate groups across the company, and also in the face of mergers and acquisitions they need low-cost, quick turn-on applications to achieve integration.
• As the world has come to see inherently more risky, companies seem to willing to accept more risk. J.B. sees less of the extended bake-offs testing and evaluating alternatives, perhaps because Web 2.0 deployments are so much smaller than SAP, for example.
• One client, with 150K seats worldwide, approximately 50% in each of two large organizations that have merged. One of the two sides had been deploying Newsgator’s SocialSites, but now they are accelerating that across both sides so that they will have a means to coordinate and collaborate right away. The ROI is obvious, immediate, and large.
• Newsgator seems to be more of a top-down adoption model, although the consumer products have established a brand awareness in the minds of users. Executive management is essential to the roll-out for large deployments like Newsgators, J.B. confirms.
• J.B. agrees that large deployments in multinational organization encounter all sorts of cultural and Cultural issues — meaning corporate and real-world cultural barriers to understanding. He goes into some detail about legal issues with privacy in various countries, as well as the importance of community managers within companies adopting these tools.

J.B.’s insights confirm many of our findings: management leadership is essential, community must be nutured, and hard times lead to strong incentives for adoption of high payoff solutions. He made a great comment, that “these are still early days, and there is no unified field theory that everyone agrees to about how to drive adoption.” Couldn’t have said it better myself, although Oliver and I hope to turn the corner on that problem, at least, as we jump into the case study side of our research this month.

I interviewed Jordan Frank, of Traction Software, recently, an old friend that I haven’t spoken to in several years. Jordan and Traction have been working with companies applying social tools for quite a long time — almost ten years — and his insights are quite interesting, and detailed.

A few highlights:

• Jordan makes a distinction between Enterprise 2.0 and Web 2.0 as being based on individual versus group rights and responsibilities. It’s interesting that this difference is one of the key elements that I have stated for years actually define Web 2.0 social tools, where Web 2.0 social dynamics are based on the individual. From my perspective, Jordan’s distinction is not where things are headed, although it might be the case that today enterprise software is still very Web 1.0.

  Frank points out that the majority of what workers write about is work related, not about personal activities, so even though personal authorship is still primary, the contributions are oriented toward shared, or company-defined, activities or projects.

• Jordan characterizes the company’s ten year mission as being ‘page-based’ collaboration. When asked about the rise of ’streaming’, Jordan agrees that microstreaming and the asymmetric follow model of Twitter offers something new, and Traction has adopted some part of those innovations in recent releases.
• Jordan makes a great case for the ticker-toy nature of social software, where from a small set of elements — like posts, tags, groups, and so on — an amazing number of use cases can be satisfied.

Jordan describes a number of case studies that are extremely interesting (I hope they apply to our case study program), and covers some interesting sales motivations: a great interview.

As part of the Open Enterprise 2009 study, Oliver Marks and I will be reviewing case studies submitted to us, looking for the most interesting and innovative stories about companies — large or small — adopting Web 2.0 technologies. We will include the eight most interesting ones — after some further research — in our report, and we will award the most compelling case study the Open Enterprise 2009 Innovation Award. That winning company will also have the opportunity to present at the Enterprise 2.0 conference this summer.

If you’d like to participate, please fill out the form, below, on or before 22 May 2009.

Jason Rothbart is one of the founders of Groupswim, a SAS enterprise collaboration solution that debuted at last year’s Enterprise 2.0 as a finalist in the conference Launch Pad. I caught up with him recently, and explored his perspective on Web 2.0 tools adoption in the world of business.

• Jason’s title is VP of Customer Success, which I think says something important about the orientation of the company.

• Jason affirms a bimodal sales model: some clients are buying really quickly, because their “heads are on fire”, where in other cases acquisition is very, very slow because you need to get the CFO to sign off on any purchase.
• His insights on how tools virally spread through a company or top-down in enterprise-wide deals confirm what we have seen in other conversation.
• Jason points out that the there is a stake difference between clearcut returns — like increased sales — but other benefits are more nebulous: “But anyone who tells you that they can tell you exactly what the ROI is is either lying or doesn’t know what they are talking about.”

The interaction with Jason is a lot closer to the deal side of Enterprise 2.0 adoption, but that aspect of what is going on is just as revealing as the more academic and theoretical issues that seem to become foremost with practitioners.

Yammer was announced with great fanfare at the Techcrunch50 conference last fall, and David Sacks, the CEO, has had the opportunity to work closely with a large and growing list of enterprise clients since. He and I recently caught up, and the time was well spent:

A few of the insights I gained:

• Yammer was called “Twitter for enterprises, or Twitter with a business model”, he recounted, but it is evolving into a larger service with more collaborative support.

• As far as Twitter goes, David doesn’t see them as a direct competitor, since it is so geared to open discourse. Selling private areas for business discussion doesn’t fit with that model, he feels, so Twitter might not go there ever. Yammer, on the other hand, is geared to privacy as the default, which makes more sense in the business context.
• Yammer also dropped the 140 character limit that defines Twitter, and which makes sense for a consumer and SMS-integrated product.
• David points out that the buyers of technology in the enterprise market are not necessary the end users. Yammer has developed a wide range of administration tools — privacy, usage policies, user management — that appeal to the IT buyers or management. But end users really want to use web 2.0 style tools even while at work.
• Yammer supports ‘bootleg’ adoption, since anyone with an ‘company.com’ email address can start using the product, so it doesn’t require corporate sign-off, but the admin tools do.
• David has found a greater willingness by users and management to try new SAS models, which favors start-ups and leads to innovation.
• Businesses have clearly come to the realization they shouldn’t necessarily own or manage their own software, David thinks. But the hybrid, viral model that comes with a product like Yammer means that companies don’t have to make any decision about buying until it has become widely used and popular.
• Yammer seems to have an immediate impact on the way work gets done. In his experience, in traditional large companies people really don’t know what people are working on. “If you think about how tools like Facebook and Twitter allow people to remain connected with large groups of friends, and think about how that could work in business, I think its going to make companies more efficient [...] and they will have much more engaged employees because the employees will feel much more connected to their colleagues and what is happening in the company.”

While David is an unabashed evangelist for Yammer’s specific offering, I found his thoughts practical and not at all bubbling with marketing hyperbole.

Tools like Yammer represent a real turning point for business, I think, where more open social discourse (even given the privacy constraints of business) and ambient awareness become foreground activities, displacing fully closed discourse tools like email, and the batch mode mindset of org charts and monthly management reports.

I had the opportunity to interview Lee Bryant, CEO of the UK-based consultancy Headshift, and the result was a somewhat long, but extremely interesting series of insights based on his work in many enterprises.

Some of the topmost insights:

• The Economy — “People are still living on last year’s budgets,” so a lot of the momentum now is still based on last year’s decisions. He expects a point of decision for many companies in the near term, which could lead to the tail-off of earlier projects. “Paradoxically, the worst you are hit [economically] the better you come out of it.” Lee suggests that those that who accept the new economic realities quickly are the first to adapt, and may get a leap based on that.
• ROI — Some shell-shocked companies are continuing to fund large, expensive, and perhaps not that beneficial projects, while requiring highly detailed ROI analysis for a $50K experimental project, which is choking off innovation.
• The Rise of the Social Web — Lee has a great historical sense, and suggests that we are at a turning point, like the start of the industrial era. “We have our own railroads, our own telephone system,” meaning the social web, and we have a chance to reorganize our economy around new sorts of scale, new kinds of efficiency and prodcutivity. This is going to be disruptive, but will lead to an new economy.
• Change Management and Culture — Lee makes the case that the meme about people being resisting change is a bit off the mark. People are open to adopting new things if they actually help, and will resist various vacuous arguments about ‘you need to change ot die’ or psuedo-mystical mumbo-jumbo about emergent values and so on. He has found it best to position these tools in the simplest most straightforward and business-oriented way.

I found myself wishing that the conversation could have gone on longer, even though it ran over 20 minutes. Lee and I will be overlapping at several conference in the next month, and I will be sure to talk to him again.

I finally connected with Charlene Li, of the Altimeter Group and the co-author of Groundwell, and she gave some great insights to the state of Enterprise 2.0.

• On Leadership — “The reason that leadership is so important is that this is really hard to do.’ The difficulties are so comprehensive that things won’t just naturally happen. “It isn’t just putting up a wiki or some blogs, there is a whole ‘back culture’ that has to be involved”.
• On Bottom-up or Top-Down — Charlene relates a story about Michael Dell turned Howard Schultz onto the SalesForce Ideas product, but “that doesn’t happen very often, unfortunately.” Usually, it starts somewhere else, and it won’t go vert far without an executive champion. “When you put social technologies in place it starts tearing down the way that power is shared.”
• On The Power Shift as Cultural Barrier — “When you give the power to people to post into a wiki or write a blog, [...] and if you let them do it freely, that diminshes the gate-keeper role. [...] And if you think about the way that organizations are laid out, its usually a bunch of silos, and social technologies puts a big sticl of dynamite in that.”
• On Tools — Charlene thinks that enterprise Twitter-like tools will displace a lot of email. “It supplements the natural communication already going on, like IM, which many enterprises have already adopted.”
• On Blogs — I wondered why we are finding blogs so little used. “I think its because people don’t like blogging. It’s hard to find time to sit down and compose your thoughts. [...] It asks people to communicate in a very different way. [...] I suggest to executives that they not blog, but they sure talk a lot, so I suggest they video themselves.”
• On 10 Years Ahead — “Today, working is very solitary [...] in the future it may all be in Twitter or other tools that sit on top of the social graph.”

As usual, talking with Charlene opened my head to new ideas. Definitely more than worth the time, and I look forward to returning to Charlene in the next month or so, when we are boiling down some of our results.

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A few months ago, near the start of the Open Enterprise 2009 research study, I interviewed Dave Hersh of Jive Software. He shared some of the response the company had made to the economic downturn, and how they had made quota, leading him to get a tattoo on his ankle.

In today’s New York Times, the ins-and-outs of Jive’s efforts to remain ahead of the econolypse (as Kara Swisher calls it) are detailed:

[via Start-Up Gets Course in Survival by Claire Cain Miller]

[...]

Then, at the beginning of last year, Jive started to stumble. It rushed to market a version of the software that was full of problems. It made bad hires in its rush to expand. Meanwhile, companies were cutting their software budgets. Jive lost money for the first time.

[...]

Seven days after the Sequoia meeting, Mr. Hersh laid off 25 of Jive’s 150 full-time employees and several contractors. They included underperforming salespeople and three executives who lacked the skills to build a company past the start-up phase, Mr. Hersh said. He scrapped an instant-messaging project and let go of the engineers on the team.

“Once you get this slap in the face of what’s really going on out there, you realize you have to make changes immediately,” Mr. Hersh said. “It was like going through a break-up — it’s tough at first and then it’s much better.”

That same afternoon, he called the remaining employees to the office’s open meeting space that Jive calls “Whoville.” Mr. Hersh first put up a slide with the names of the laid-off employees. He figured the remaining employees would not look around the room wondering who was missing and would thus concentrate on what he had to say. He detailed everything the company had done wrong. He borrowed from Sequoia’s presentation and told the staff that Jive needed to conserve cash, make swift and deep cuts and invest based on results instead of ahead of them, as they had when they overhired.

“Everyone was kind of numb, distracted,” said Dennis Deveny, a field sales director at Jive. “I got the vibe that Dave was near tears.”

Then Mr. Hersh got his own taste of change, when Bill Lanfri joined the board as its new acting chairman. Mr. Goetz [of Sequoia] made the introduction. Mr. Lanfri had been the chief executive of Big Bear Networks, another Sequoia portfolio company. Mr. Goetz had also introduced Jive to another director, Tony Zingale, the former chief executive of Mercury Interactive, a software company bought by Hewlett-Packard.

In January, Mr. Zingale brought on John McCracken, who had been his vice president of sales at Mercury. Mr. McCracken, who is known inside Jive as Johnny Mac, went to work overhauling Jive’s haphazard sales process. Jive’s strategy had always been to try to sell software to anyone who called. Mr. McCracken considered it a waste of money to chase customers who did not really want Jive, especially as the recession made software a much harder sell.

Salespeople were instead trained to grill potential customers with questions about their budgets and goals and turn away customers that did not fit. “One of the best things you can do as a business is to learn to say no,” Mr. Hersh remembers Mr. McCracken telling him.

On a recent sales call with a large technology company, Mr. Deveny was told that it already used other wikis and forums. “Aren’t you just compounding things by adding another to the mix?” Mr. Deveny asked, playing the devil’s advocate. A week later, Mr. Deveny turned down a company because Jive thought another company’s software would be a better fit, something that would have been unheard of before.

Instead of boasting about cool technology, salespeople now explain how the software has helped companies save money. They tell the story of T-Mobile, where a salesperson who risked losing a deal posted a question on Jive, received responses from far-flung colleagues and closed the deal.

After the upheaval at Jive, the buttoned-up Mr. Hersh promised employees that if they sold $8 million worth of software in the fourth quarter, he would commemorate it with a tattoo.

They succeeded, and on a rainy January afternoon, he called a tattoo artist into the office break room, drank a glass of Scotch, rolled up his gray dress pants, stuck his ankle out and braced himself while the tattooer inked a Roman numeral eight, designed by the same employee who had created the company logo.

Since then, he said, other tattooed people often strike up conversations with him about their tattoos’ meanings. Most say theirs depict the cycle of life, Mr. Hersh said. “I’m like, ‘We hit quota!’ ”

Seems like a story of accelerated growing pains, brought on by the economic mess. Perhaps a sign of maturity in the Enterprise 2.0 industry, as well.

At the outset of the Open Enterprise 2009 study, I set up a UserVoice account, intending to use that tool as a way to gather thoughts and feedback from the Enterprise 2.0 community to guide out study.

I have embedded the link to the UserVoice here, and invite those reading this to participate, there. I will also spend some time walking through the ideas that people have offered up, and I will write a post in the next few days characterizing what I see there.