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Enterprise Web 2.0: Building the Next-generation Workplace
Butler Group, Sep 2008, Pages: 192
CATALYST
The term ‘Enterprise 2.0’ has become the catch-all phrase that describes the wholesale change in enterprise IT thinking. Driven by changing business needs and social factors, organisations are starting to do things differently. Speed, agility, mobility, reuse, and innovation are the transformative drivers that are forcing organisations to push aside old technologies, models, and architectures to make way for the new Web 2.0 world of service-oriented, highly-virtualised, truly-commoditised, and eventually ‘utilitised’ systems and solutions. Social software, collaboration, and real-time communications are pivotal parts of the ‘Enterprise Web 2.0’ story, and these are acting as the conduits for new cultural ideas and practices.
ANALYSIS
Introduction
The term ‘Enterprise 2.0’ has become something of a catch-all phrase that describes the wholesale shift in enterprise IT thinking. Driven by changing business needs and social factors, organisations are starting to do things differently. Speed, agility, mobility, reuse, and innovation are the transformative drivers that are forcing organisations to push aside old technologies, models, and architectures to make way for the new Web 2.0 world of service-oriented, highly-virtualised, truly-commoditised, and eventually ‘utilitised’ systems and solutions.
Vendors and commentators have been appending the ‘2.0’ suffix to all manner of enterprise products and domains over the last year or so in an attempt to signify something new, innovative, and user-focused. The terms ‘BI 2.0’, ‘ERP 2.0’, and ‘CRM 2.0’ have all been used in some way or another to imply ‘next generation’ or ‘leading-edge’, but the term ‘Web 2.0’ remains the touchstone of the IT industry, and use of the term by the IT cognoscenti when discussing a product or service usually infers particular value or importance.
In some circles, the terms ‘Enterprise Web 2.0’ and ‘Enterprise 2.0’ are used interchangeably to describe the application of Web 2.0 ideas and technologies in the enterprise; however, Butler Group believes that a clear distinction exists between the use of these two terms, and that this differentiation is important to maintain, as it enables a more meaningful discussion to be had when examining the future role of IT within the business. We’ve been here once before of course, with the words ‘Web’ and ‘Internet’ being used interchangeably, and this still causes confusion today when IT professionals have conversations with their business counterparts.
Building on the somewhat vague and yet particular usage of the term ‘Web 2.0’, ‘Enterprise Web 2.0’ describes a fresh, and some would say new, approach to the design and provision of business applications that incorporates aspects such as social networking, collaboration, and real-time communication. In addition, Enterprise Web 2.0 focuses a great deal of attention on the user’s ‘experience’ or ‘joy of use’ – something of a novelty in enterprise IT these days. By comparison, when Butler Group talks about ‘Enterprise 2.0’, we are focusing on the composition and architecture of the IT ecosystem, and the associated business models that will support Enterprise Web 2.0 applications.
Business Issues
Although technology certainly plays a part, Enterprise Web 2.0 represents more of a philosophical shift than it does a prescribed set of IT products or solutions. As with the consumer-oriented Web, Enterprise Web 2.0 is very much concerned with the user experience of corporate systems and applications, and on extracting business value from the social contributions and interactions of the organisation’s various stakeholders.
Understanding what experience is expected by which constituency is crucial, and herein lies the challenge for business decision makers.
There are many business drivers associated with the push to adopt Web 2.0 concepts and philosophies, the most important of which relate to the areas of customer service, cost reduction, innovation, risk mitigation, and market opportunities. Each of these can, in turn, be linked with specific pieces of Web 2.0 technology or concepts; however, forming and establishing these links is not a task to be undertaken lightly.
Enterprises can no longer ignore the gravitational pull of Web 2.0 technologies, concepts, and memes, as they are immense. However, Butler Group is witnessing a repeat of history in some cases, as businesses and institutions opt not to invest in this area, as they fail to see the relevance of this sea change to their organisations. This presents something of a concern, because the Web is central to so many aspects of business and commerce. Even the public sector, with its traditionally cautious approach to new technology and process change, has recognised the importance of Web 2.0. Indeed, the people-centric aspect of Web 2.0 probably makes this era of ICT evolution the most relevant yet.
As has already been stated, Enterprise 2.0 is concerned with the composition and architecture of the IT infrastructure that will support Enterprise Web 2.0 applications. In the past, the shape and nature of corporate IT has been determined by a number of factors, most of which related to the very specific nature of the organisation’s business and operational requirements. Enterprise 1.0 was dominated by a handful of powerful vendors and service providers, and most of the systems and applications constructed during this time were siloed. Expensive integration projects were the norm, as IT departments tried to respond to the organisation’s changing business requirements.
The business issues that are forcing IT management to re-evaluate their strategies are of course many and varied, but some common trends have become evident. The management of customer relationships continues to remain pivotal for most organisations, and so the social aspects of Web 2.0 are mirrored in the corporate world of Enterprise Web 2.0. Workforce mobility and changing communication patterns are two more trends that are driving change at the infrastructure layer, and so unified communication and collaboration requirements form an
important part of Enterprise 2.0 strategy.
Risk management and mitigation continues to be a high priority for CEOs, and this has produced a cascade of requirements impacting corporate IT, many of which relate to the governance and control of information. The need to address new markets and the ability to continuously innovate are placing great demands on the IT department, both in terms of skills and resources, and so the ability to mix-and-mach external services from a variety of providers to fulfil business system functional requirements is a major, non-technical element of Enterprise 2.0 strategy.
Technology Issues
Enterprise Web 2.0 might be about putting the user (i.e. employee, customer, or stakeholder) first, but in order to do so it also requires supporting technology. And so at the IT infrastructure level, Enterprise 2.0 means Internet Protocol (IP) everywhere – voice, video, and data. Enterprise 2.0 also means, ‘open’ standards rather than proprietary or ‘closed’ systems. Furthermore, Enterprise 2.0 technology means user-driven technology and not IT-driven technology.
If we take, for example, the implementation of a social networking site, perhaps as a way to enhance customer relationships or to capitalise on the knowledge and know-how of employees, then this requires technology investment in terms of hardware, software, networking infrastructure, and bandwidth. All that technology costs money, and building a cohesive and compelling business plan to warrant such spend is not easy if one considers that we are in some ways still in the experimental phase of Enterprise Web 2.0. Open source advocates might shout about the cost benefits of this increasingly popular software model, but it still needs hardware to run on, and the few open source hardware projects that have been initiated have not yet had the same impact on costs as software initiatives.
The fact that consumer-centric social networking sites can provide user accounts for free must tell us something about the economies of scale that come into play at a global level. With advertising revenue a measly US$10 per user by most estimates, the cost of providing a self-service account on a site like Gmail must be incredibly low when compared to the cost of providing a corporate mailbox using Microsoft Exchange. Even at US$50 for a managed account, the figures still point the way to the ‘utilitisation’ of core IT services.
Real-time communications are a fundamental component of the “new world of work”. Whether it is Instant Messaging, video conferencing, white boarding, or application sharing, moving to a unified communications and collaboration environment is something that all IT managers should be thinking about. As dominant players in the enterprise collaboration and communication market, all eyes are on Microsoft and IBM to see if they can match the pace of innovation from the likes of Google. A similar disturbance is also taking place in the telecommunications industry, as incumbent national suppliers to businesses and institutions refocus their efforts and attentions to take-on new entrants to what is a very competitive and lucrative market.
If IT has become a commodity, then only an organisation’s people and processes can make a difference. Oh that it were this simple, because as we all know, only a small fraction of an organisation’s processes are actually instantiated on computer systems, and these are not necessarily the most important processes either. Having accepted the fact that ‘processes’ means ‘people’, then we have to look for ways in which these people (i.e. processes) can self-organise and reference one another. Then, where possible, we need to somehow incapsulate the processes into a set of business services. One day (we might call it Web 3.0), Artificial Intelligence (AI) will enable organisations to do with computers that which they do via human beings today, but until that day arrives, organisations must do more to aid interdepartment and inter-company collaboration. Workflow has not yet figured largely in the consumer-oriented world of Web 2.0, but Butler Group sees this as pivotal when considering Enterprise Web 2.0.
Behind the scenes, Service Oriented Architecture (SOA) is a very important aspect of Enterprise 2.0, as it promises to enable a number of Enterprise Web 2.0 opportunities through the re-mixing and re-configuring of business processes. In industries where no physical product or service results, processes merely act upon bitsand- bytes, and so, in a way, the situational application (or mashup as most prefer to call it) becomes the embodiment of process. Today applications that embody processes are built by IT professionals, but tomorrow they will be built by a new breed of power user, using mashup builders, software agents, and other Web 2.0 technologies.
Management Issues
Enterprise Web 2.0 begs the question: What if? Indeed, there are probably more questions than answers at present, but one-by-one these are being addressed as evidence from early adopters comes to light. For example, those organisations that have progressed down the Software as a Service (SaaS) route are starting to integrate across service providers and technology boundaries much as traditional IT departments do in-house today. The leaning curve still looks steep today, but there are signs that the gradient is reducing as this particular market matures.
We have seen that Web 2.0 is all about empowering the user, and that unexpected things happen as a result. Business and IT managers must therefore prepare themselves for the new generation of power user who will be creating mashups and situational applications that have a far broader impact than the typical spreadsheet macro of yesteryear, and that if organisations are to avoid a proliferation of unmanageable, siloed, micro-applications, then they must blend the power of personal productivity with an appropriate management layer and a degree of central oversight. This is a development that has great potential, but it is as well to be aware that these trends are never entirely egalitarian.
Businesses and institutions very clearly consist of people, and these people are the recipients of products, goods, and services from other organisations and sources. Perhaps this is an obvious statement to make, but some managers still seem to think that the world of Web 2.0 only exists beyond the walls of the enterprise. While every corporate employee is a consumer, not every consumer is a corporate employee, and so organisations must consider carefully how best to exploit virtual communities and social networking sites. Some organisations will decide to use the social memes being introduced by the likes of Facebook, MySpace, and LinkedIn internally, by implementing an Enterprise Social Software solution; while others will seek to exploit these established networks by intertwining their business model in some way with these properties.
Web 2.0 is no longer PC-centric. Thanks to companies like Apple, Microsoft, and Nokia, the smartphone is fast becoming the device of choice for tech-savvy users. But herein lies a challenge for the corporate IT department, because amongst the tech-savvy users are tech-savvy managers, and these managers will want corporate IT on their terms, and not on those of the Chief Information Officer’s (CIO’s) or Chief Technology Officer’s (CTO’s).
Social issues can be quite distinct from People issues, and Butler Group believes that organisations must raise these higher on the management agenda, as sanctions might otherwise befall them. Green IT and Corporate Social Responsibility (CSR) are themes not unrelated to the changes required in order to follow the Enterprise Web 2.0 path. With office equipment now accounting for 15% of total energy usage in developed economies, organisations are being encouraged and ‘incentivised’ to meet new energy-consumption targets, and so shifting applications from the desktop to the data centre (or the ‘cloud’) undoubtedly plays into the area of Enterprise Web 2.0 from the end user’s point of view, and into the area of Enterprise 2.0 from an IT Management perspective.
Although out on the periphery of our Enterprise 2.0 discussion, we must also consider the general IT skills shortage within the industry, as this could significantly impact the Enterprise Web 2.0 plans and initiatives of organisations. According to a survey conducted by the Society of Information Technology Management (Socitm), most said they were experiencing IT recruitment problems. All markets are driven by supply and demand, and so corporate IT costs look set to rise unless the IT department can somehow deliver more with less.
Conclusion
In the consumer space, Web 2.0 is very much about ‘participation’ and ‘contribution’ – tenets dearly sought by most companies and institutions, and so the challenge for senior executives is to capture this momentum and to ingrain it within the corporate culture and the organisation’s people-centric business processes as part of Enterprise Web 2.0.
It is clearly a mistake to think that Web 2.0 is all about technology, and likewise Enterprise Web 2.0, but it is also a mistake to dismiss the technology altogether. Therefore, selecting and implementing enterprise social software solutions, next-generation collaboration solutions, and Rich Internet Applications requires careful thought, consideration, and planning.
If one assesses the information management and collaboration market from a Enterprise Web 2.0 perspective, then we see that some providers are taking a product-based approach, tailoring solutions to meet particular business scenarios, whilst others favour embedding facilities into operating systems, portals, application platforms, and of course the Web; and so choosing the right offering is no longer as simple as following the perceived market leader.
The driving force behind just about every aspect of Enterprise Web 2.0, is of course, the user – something that has not always ranked highly on the list of priorities for corporate IT mangers – and so the challenge for all forward-looking organisations is to refocus on this aspect of their IT strategies.
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