At the International Forum on Enterprise 2.0 in Milan, Mark Tamis from Net-7 and Esteban Kolsky from ThinkJar talked about “A new era of customer engagement with Social CRM”. Their point of view on this complex matter is the following:

Why is the social customer becoming an important subject these days? Simply because people trust other people – even if they do not know them or only know them from the Internet – more than any company. Instead of watching a company’s ad and then buying the product, potential customers are turning to friends to ask for advice or post a request in some relevant online forum to find out about other people’s experiences. So, instead of seeing the product you want to sell through the eyes of your company, you now have to see it through the eyes of the customer.

Therefore, they say, the new business model is going to be twofold: In addition to focusing on internal Enterprise 2.0 operations, external aspects have to be included as well - namely the social CRM (client facing operations).  Thus, the new business model must be a hybrid of both internal and external communities. This means that employees and customers have to work together very closely in the near future as customers want to become part of the process themselves. So after evolving into a social enterprise, the next step will be a “collaborative enterprise” where there is major interaction with the ecosystem (customers, employees, partners, suppliers, channels).

According to Mark and Esteban, the following things have to be taken into consideration:

1. Customers are more connected to each other than to the producing company > The company has to become part of the communities to become a trusted entity
2. Customers follow the direction provided by the social network > Natural effect of herding
3. Organizations follow the direction provided by the technology > But they should follow the direction provided by their strategy
4. Convergence of social CRM and E20 occurs in communities > This takes a lot of time!

Of course, this is a very long and time-consuming process. And according to the presenters, a company first needs to be entirely E 2.0, before developing into a collaborative enterprise. Many companies are already at different stages in this process and the crucial point is always the maturity of the company: The change in the mentality is a long way to go.

A more detailed insight on Mark Tamis thoughts is provided by him in his blog.

So much about the presentation in Milan. Social CRM is currently a very trending and highly debated topic among the evangelists. The integration of the customer in the business process is also not a new topic (see the discussions about mass customization). But the integration of socially interacting customers is a new one that is relevant to various fields of business processes such as communications, marketing, sales etc. Each of this disciplines are experimenting in the one or the other way with the social web - a holistic view on this topics must be the end solution but is still far away from yet being realized.

Or do you think differently?

Recently we have been quite busy in preparing and organizing events that did not leave time to systemize and arrange my collected thoughts about all those discussions and informal exchanges I had with experts and practioneers in the field of Enterprise 2.0 during the last months. Today I am quite locked to nothing more than accompanying Bertrand at his pre-conference workshop for our E20 FORUM in Paris tomorrow. This leaves time to sort out my ideas that are turning around my head already for weeks.

It’s about the emergence of the E20 idea within the corporations. A lot has been said and written about the necessity and potentials of the new forms of collaborations and communications by using social software. Quite a few contributions have even predicted a big bang of change in the enterprise world. Others have criticized this vision and labelled the E20 thingy a “crock”. The truth is - as always - in the middle because E20 - as so many other business innovations - is not emerging in one step but is dependent on a cultural change within the corporation that again happens slowly.

So to explain the state of E20 we have to take a differentiated view on the different stages of the E20 emergence in the corporations. For each stage I see different people being involved in the diffusion process of this idea. They have different motivations regarding the E20 subject that serve more or less towards the big vision of E20. But they all contribute their share towards the diffusion process of this idea. Therefore I’d like to compare the diffusion of this idea with the dissemination of a virus:

(0) At some point someone is initiating some social software projects in the corporations - mostly under the radar of any strategic decision. These projects are mostly departmental projects with a small group of co-workers involved. There are quite some examples in which the IT departments started using some kind of wikis for documentating IT projects. In other examples some tinkerers (and yes I am not talking about the Generation Facebook but about tinkerers because I do not think it is a matter of age!) have installed or introduced some kind of social software e.g. microblogging service as Yammer in their departments. According to the image of the virus dissemination I’d like to describe this stage as “localized infections”.

(1) At the second stage I have observed quite a lot of companies in which the communications department came along the Web 2.0 thingy in the first place. Quite a lot of them have perceived this Web 2.0 thingy as a new way of communication format - in the terms of using social software to get people more involved into the messages corporate communications wants to send out. This in mind they might install corporate blogs to initiate discussions and feedback channels or add wiki or social networking functionality to the intranet in order to centralize the knowledge capturing and sharing. In regard to my analogy to the virus dissemination I’d call this the “first outburst” - as these initiatives have created quite a lot of attention within the enterprises. But in the long term most of these project could not gather any critical mass of participants because they have been set up as top-down initiatives to improve the impact of corporate communications and not been used to enhance the information flow. But we must not underestimate the effects of these projects. Because even they might have failed or not as supportive for the E20 vision in the long run, they are important for the further dissemination of the E20 virus - as they show the strategic relevance of social software within the corporation. This said these project will be indirectly supportive towards the growth of the grass-rooted projects.

(2) Eventually the growth of some of these grass-rooted projects will call the attention towards the department that is in charge for the organizational development. They will analyse and try to “decode” the effects of these projects. Eventually they might realize the business value generated by the improved information flow and the enhanced knowledge sharing within these projects. They might try to take over the control of these initiatives and turn them towards a corporate initiative. This is the point at which steering committees are been created and the subject of E20 becomes a strategic issue. But though there are thoughts about the enterprise-relevance most of the enterprises in this stage will not reorganize completely at this point. Because the realized business value is mostly generated “above the flow” and not “in the flow” of the business value chain. And as the enterprise is driven primarily by the success of the value creation in the line of business and not by some kind of enhancement in collaboration and information flow - only service companies that are primarily dependant on knowledge sharing for the business lines will succeed with the E20 thingy already at this point. Examples are for example CSC or Booz Allen Hamilton.

(3) Therefore the next stage in the diffusion process I see within those projects that deploy social functionalities towards the IT systems of the line of businesses. Examples for this I see in the Business Innovation Community project of Daimler (that is an open innovation platform installed by the business development department), the social enhancement towards CRM processes as well as the emergence of “personal learning networks” promoted by HR departments. According to my analogy I would call this stage the “virus variations” stage as in most cases there are more than one department that start a strategic E20 initiative.

(4) Finally as each of these different initiatives grow towards strategic relevance the management board eventually sees the demand to “streamline” the initiatives in order to effectively balance the benefits on the enterprise level. At this point they will approach the crossroads of the E20 success or failure as the “streamlining” can be organized as a top-down centralization of the projects which will kill the grass-rooted movements of each project. Or - the “streamlining” will lead towards a deconstruction of the business model because the management board as well as the corporation is “viciously infected” by the idea “to let loose” and “to open up” in order to gain new business value.

As a result the enterprise might eventually reach the final stage of a new form of organization that I do not want to describe at this point - as it would be quite hypothetically as I have not come along enough examples that resemble this stage.

To reply upfront to the critics of the above describe sequence of diffusion stages - there is no statistical evidence to this image, it is only a personal observation and conclusion towards the different stages of E20 infection. It might be an answer towards the question why the “big bang theory” won’t work for this kind of projects because the E20 thingy is a cultural change that must emerge slowly to all parts of the corporation and leads eventually towards a change of the business model.

Looking forward to any comments.

While cleaning up my inbox I stumbled upon some old mail conversations of our advisory board regarding a dogmatic discussion about whether Enterprise 2.0 is an "evolution" or "revolution". From my last post on the classification of use case it becomes clear that I am very much on the "evolutionary" side of the discussion when it comes to how to fit the social applications into the enterprise application stack. But on the organisational dimension of the discussion I very much agree on the arguments that successful E2.0 initiatives need a reframing of the organisational structure of the enterprise. But instead of bothering you with my opinion I would like to point out some of the great statements from the discussions of our advisory board.

The discussion all started with a statement of Mark Masterson regarding the missed aspect of integrating social applications with the enterprise business solutions:

As I’ve said elsewhere , I think that we spend much too much time talking about implementing social networking software silos ("build a wiki, and they will come"), and much too little about baking SNS into existing domain and task specific systems. Bjoern, you suggest something quite similar in your recent post , where you speak about this under the "Being Complementary and Integrative" bullet point.
I have elsewhere made the argument that one way to approach the problem would be to marry up SNS functionality with BPM software (read it here ). But not everyone is convinced that this is a good idea — there are some who responded to that (and other, similar ideas elsewhere) that BPM would be
poison for SNS — that the structured processes a BPMS implies are anathema to collaboration, never the twain shall meet.

In response to this Lee Bryant brought up the point that just enhancing the excisting processes with a layer of interaction to support crossfunctional sharing of knowledge and collaboration is not enough because a complete reframing of the idea of the organisational structure is needed in order to be successful in Enterprise 2.0 initiatives.

Existing businesses have structure and they have process, but as Mark says, the problem lies in trying to automate or de-humanise process, rather than with the idea of process itself. In terms of structure, a  question on my mind is how we can re-design businesses and organisations around the ideas of flow, aggregation, networks and collaboration, rather than just think about how we can work within the existing structures that we find in large businesses today. For example, looking at the segmentation you have applied to the audience  and tracks, I find it interesting to note that Intranet and ECM departments should simply not exist. Arguably, neither should central knowledge functions, which are better located within lines of  business. So the question is, what are the organisational design implications of E2.0 tools, techniques and ideas?

Last but not least I want to include the propositions of Bertrand Duperrin on this - whom I would put on the "evolutionary" side of this discussion as he proposed foremost a "rethinking" of some key corporate values in order to really foster the network effects of social applications in or above the "flow":

1. think in terms of system (dynamic flows) rather than organization (set org-chart)
2. Think "global improvement" (macro vision) rather than "functional optimization" (micro vision)
3. Think "increase performance" rather than "cost reduction"
4. Think "pull" (listen to the client’s voice..and client may be internal) rather than "push" (offer and product approach)
5. Think "individual" (what he is, what he knows, what he likes) and not "function" (what he has, what he must do, his status)
6. Think "ongoing experimentation" (permanent beta with quick retro-action loops) rather than according to the "test/validation/production/generalization".
7. Think "immediate generalization" (in order to make it possible for unexpected things to emerge) rather than "progressive generalization" (because it contradicts the economic benefits driven by the network effects)
8. Replace "think" by  "act" in the previous points
9. Don’t use hierarchy as a substitute for trust.

So - what do you think on this? What are your experiences? At the E2.0 SUMMIT will be addressing this discussion with different sessions - to really get a in depth understanding of it and eventually to provide some strategic implications. In order to enhance this discussion upfront I would be very interested about your opinions and views on this.

What is Enterprise 2.0 all about? IMHO - this is the most asked question when talking about this topic. As several bright heads have said before instead of theoretically talking about the Enterprise 2.0 vision we need to talk about use cases and case studies that show and unveil the power of this so-called “social business“. At the Enterprise 2.0 SUMMIT we have defined four different use cases that are going to be discussed along different best practices presentation. And while setting up an explanation of these use cases two days ago I ran along this nice post of Larry Hawes discussing the “nexus of business process & ad-hoc collaboration” that led me to an idea of a more broader view on the topic to be discussed in the following.

In his post Larry Hawes refers to post of Sameer Patel discussing the difference between ECM systems and social software:

ECM enables controlled, repeatable content publication processes, whereas social software empowers rapid, collaborative creation and sharing of content. There is a place for both in large enterprises. Sameer’s suggestion was that social software be used for authoring, sharing, and collecting feedback on draft documents or content chunks before they are formally published and widely distributed. ECM systems may then be used to publish the final, vetted content and manage it throughout the content lifecycle.

This relates to my understanding why enterprises need such thing as social software - because they need to change and to innovate in order to be more competitive in their markets. Consequently they have to discover new opportunities, ideas and information that is describing or representing these. And as a result from the organizational perspective companies need some kind of “reframing” of their business model.

Inspired by the post of Larry Hawes I would therefore describe the difference between established enterprise business applications and Enterprise 2.0 on a dimension of how the application is supporting the “reframing” process (I am explicitly not talking about “change” or “transformation” here because IMHO “change” is a consciousness thing needed to be done before and “transformation” might go far beyond the needed “reframing” in order to be up-to-date to customer and market expectations).

On this dimension established enterprise business application are “securing the precedent”. They support the planning-and-control-organization of the current operations by registering and certifiably documentating business incidents. The applications provide insights towards the historical status-quo of the business operations and can be distinguished by the business entity it is focussing on. On the one side there are established and defined processes and on the other side business-relevant data and unstructured information that have to be managed throughout their lifecycle.

If we take the scenario of Larry Hawes regarding the customer service issue there are business incidents - commonly in the sphere of knowledge working - that exceed these pre-defined processes and information structures. For these incidents the staff needs to move beyond the status-quo of defined processes and stored information. Former approaches to this used special methodologies like delphi studies and artificial intelligence toforcast the future in order to discovery new opportunities. At this point - social software offers a new approach - as it provides a way of harnessing the collective power of a interconnected setting of people to discover and ventilate new ideas - by externalizing and opening up data about information chunks, knowledge and process execution towards the crowd.

In regards towards this dimension of “reframe” I hence distinguish two further steps: first the “discovery” and second the “exchange”. This takes account of the idea of the learning organization that focuses on enhancing its systems to continually increase the organization’s capacity for performance. It also supports a phrase I first came along in a presentation of Lee Bryant: “It’s all about managing feeds & flows, and not objects“.

Along with the differenciation of business processes and business information, it helps again to keep apart four different use case scenarios of Enterprise 2.0:

1. Unveiling & associating information & knowledge (Knowledge Management 2.0):
   This is about working collaboratively on a state of externalized business knowledge e.g. project/process documentation, service issue/process documentation or sales-orientated product & market documentation. Giving access and authoring as well as sharing possibilities to the crowd creates the chance of someone adding not expected, but very valuable information towards the knowledge base and therefore enhancing it.
2. Support conversation & communications flow (Internal Communications 2.0):
   This is about the exchange and open discussion of new opportunities, ideas or gained knowledge throughout conversational systems as weblogs or microblogging infrastructures. This supports the distribution and ventilation of new ideas throughout the company - eventually reaching out to people that can give valuable feedback to ideas.
3. Supporting & enhancing ad-hoc collaboration (Collaboration 2.0):
   This is about supporting ad-hoc initiated team working to solve issues and problems that go beyond the pre-defined scope of problems or issues. As this would have been solved in offline circles of expertise so far Enterprise 2.0 approaches allow this to be solved on in a digital Enterprise-wide manner.
4. Supporting the learning organization and providing a market of ideas (Innovation Management 2.0):
   This is about interconnecting business entities with people and information about their tasks, interests and competences. Community-of-practices are a common tool for this approach though in times of social software this would rather implemented by an internal social network that is giving even a broader access to people and the relevant information flows within the enterprise.

Just to be clear the above mentioned use cases are not directly linked to technological solutions but certain social software concepts fit better to the one or the other use case. Therefore wiki solutions provide a good approach towards the collaborative knowledge work. While weblogs and microblogging solutions are better in giving access to the flow of information. And social networks provide advantages for supporting collaboration and the learning organization.

At the Enterprise 2.0 SUMMIT we will discuss different best practices for these four use cases and I will sum up my insights regarding the fit of this matrix towards the practical use out there in a post after the conference. But before this I would be very interested in your thoughts on this!

While we are still far away from the maturity stage of Enterprise 2.0 in terms of numbers of realized projects, the discussion about the Enterprise 2.0 topic becomes more matured and leads finally beyond talking about the chances and opportunities. This might be a sign of the on-going economic crisis and its urge for a more specific discussion about this topic (see the call for the Reality Check 2.0), but it might also be a result of the emergence of the now gained insights from the first best-practices in this field. The exchange of experiences is a very supportive means for this - as enforced by initiatives like the 2.0 Adoption Council , E20Cases.org and others.

This said - I think it’s time to consolidate the topics to be discussed in regards to improve and enhance Enterprise 2.0 projects. From my research for setting up the conference program of the Enterprise 2.0 SUMMIT - I identified 5 key topics for project leads to take care of:

1) There is only one goal to be achieved: collaborative performance.

Yes - we can talk about changing the our world but at the end of the day we live from what we have achieved on a set of goals.

Keeping this in mind it is the results orientation that is driving a project to success. While the measurement of the return of Enterprise 2.0 activities is more complex than with ordinary business processes it is not unfeasible. 2.0 systems are depending on group dynamics that are not always measurable at first sight (as for example in the case of indirect network effects). Therefore we need new approaches to measure the effects. But in the end it’s all about "performing" as stated in Bruce Tuckman four-stage model called Tuckman’s Stages . In conclusion of this is that the development of a collaborative performance measurement is firstly the key to the argumentation for Enterprise 2.0 initiatives as well as the "steering" wheel for the success of the project.

2) Keep the interaction alive and kicking with participation & community management

As already said the 2.0 world is depending on group dynamics realized by social software systems that increase transparency on what other group members are doing and ease the way of participation. So changes and transformation is indirectly caused by interactions within the group. The facilitation and guidance of the group’s interaction process is one of the keys to Enterprise 2.0 effects. It is and will never be guaranteed just by the installation and implementation of technology. The management of this facilitation and guidance is a strategic task of the project and therefore highly important as discussed in Dion’s post on "Community Management: The ‘essential’ capability of successful Enterprise 2.0 efforts" . The conception of the participation & community management is the operational structure for this kind of projects.

3) Set the right environment variables to new forms of organizational schemes and leadership models.

As we are talking about a new way of operational structure within Enterprise 2.0 activities we also have to have a look at the organizational structure. While the traditional organizational structure is based on the concepts of bureaucracy best-practices of Enterprise 2.0 initiatives show that they are better off if they are structured by the ideas of adhocracy . This implies new forms of organizational schemes and models of leadership.

As taken from the Wikipedia the concept of adhocracy leads to the following characteristics of the organizational setup that have to be discussed:

• highly organic structure
• little formalization of behavior
• job specialization based on formal training
• a tendency to group the specialists in functional units for housekeeping purposes but to deploy them in small, market-based project teams to do their work
• a reliance on liaison devices to encourage mutual adjustment, the key coordinating mechanism, within and between these teams
• low standardization of procedures, because they stifle innovation
• roles not clearly defined
• selective decentralization
• work organization rests on specialized teams
• power-shifts to specialized teams
• horizontal job specialization
• culture based on democratic and non-bureaucratic work

4) Be aware of the complexity of changing the game

As derived from the first three topics the implementation and adoption of Enterprise 2.0 concepts within the organization implies a cultural change process at some level (dependent of the scope of the project!). Therefore the management or (as some may say no to a cultural change management) better the facilitation of the process of a cultural change is another key to the success of these projects.

I would like to cite Stuart French at this point :

The key here is that while culture is not a “thing” to be managed, it is certainly undergoing constant transformation. As mentioned earlier, the real power of a cognitive view of culture comes from a change of perspective. If we can learn to see that cultural issues are complex and highly contextual and that intra- and cross-cultural interactions are actually collaborative, mutual learning experiences (Holden, 2002, p.54), then managing both the opportunities and pitfalls simply becomes an issue of knowledge management, specifically networking, knowledge sharing and collaborative (or organisational) learning (Holden, 2002, p.52).

So therefore adoption is a reciprocal process of a) the guidance and governance of the interaction from an organizational perspective while letting people the freedom to take up the group action from a personal perspective and b) the feedback of the outcome of a).

Matthew Hudgson has put together a great diagram of the "Meta theory of social computing tools adoption within Enterprise 2.0".

5) Discuss the scope of Enterprise 2.0 beyond blogs & wikis

While the scope of the discussions around Enterprise 2.0 is mainly focussed on facilitating the generic collaborative processes within the enterprise we have to look beyond this to get the big picture.

Susan Scrupski has drafted a first scene of what has to be viewed in a conjoint way:

These are my takes from my research. As a conclusion I would say it is still a long way to go before we can clearly write down a handbook on Enterprise 2.0. But the discussions are getting more focussed on theses key topics and with the Enterprise 2.0 SUMMIT on Nov 11 & 12 we are trying to support this as we have chosen these topics to be the underlying themes of the sessions within our Expert Talks Track .

But tell me what are you thinking about this?

PS for those that may be interested in coming to the E2.0 SUMMIT: Get your ticket now and register with a 200 EUR discount on the full conference pass until Oct 11 with the promotional code "e2open200". http://www.e20summit.com/registration.html

UPDATE: Updated Susan’s diagram with the final version!

As Sebastian Schäfer completed my comparison of different Social Software Categorizations with an interesting model by Andrew McAfee, I’d like to share a crash course on Enterprise 2.0.
The video is already around for a few weeks, but Mattias Schwenk reposted it today. It contains the concept of the Enterprise 2.0 Bullseye, a look on social software tools strictly through the ties between people.

I just didn’t get to embed the video, so please go and see it on youtube in HD-glory and have a nice weekend.

Update

YouTube Direkt

When it comes to Social Software in the Enterprise the full suite solutions are on their way. See the last Gartner Magic Quadrant for Social Software for details and vendors.
As the pure products vanish and build up on functionality, it might be worth a look to some general categorizations of social software. So we won’t have to talk about “kind of a blog with wiki functionality” or something similar.
Gartner uses the dimensions “ability to execute” and “completeness of vision” in the Magic Quadrant which are great for vendors or products, but not for functionality in general.

A common approach in germany builds upon a classification system for CSCW-Systems. (Teufel, 1995)
The first adoption for Social Software by Schmidt focused on the three funtions Informationmanagement, Identitymanagement and Connectionmanagement.

In an improved version by Koch and Richter (Cooperation Systems Center Munich (german), Bundeswehr University Munich) changed the connection part to communication and added the loose connections to the identitymanagement. You might think of all your quiet facebook friends here.

Niall Cook has a totally different Matrix, the 4C’s as in his book Enterprise 2.0 book.

I merged two diagrams to get this one, so some software examples aren’t in here. I’m not confident with this classification as there are some well known apps split up across the matrix, i.e. Tagging and Social Bookmarking. In the original book you’ll find more examples.
Cook mentions cooperation and collaboration, two points which misses out on both triangles.

Another idea is a draft by Joachim Niemeier in a german slideshare presentation.

Personally I like the quadrant best, but I would add some modifications to it. As long as my ideas on this are not fully set, I prefer even more inspiration.

So did I miss out some well known ideas?

Unfortunately the processing of this video at the Sevenload site took more time than expected. Anyway, in the following you find a nice fireside discussion with Dion Hinchcliffe - interviewed by Dr. Frank Schönefeld from T-Systems during a press event we made at CeBIT 2009. Mainly they are discussing the latest developments on E2.0 in general, its adoption in the US and Europe as well as how to evaluate the effects of E20 activities. On the last aspect Dion pointed out that “ROI is famously hard to measure on E2.0″ and his urge to put together more case studies in order to evaluate the effects.

Sevenload Direkt

In an internal discussion of our Advisory Board regarding the topics of the E20 SUMMIT program Joachim Niemeier posed the question whether classical economic measures are suitable to measure and verify Enterprise 2.0 effects. Though cases like the TransUnion project (cited by Dion in his blog post on determining the ROI [cross-referencing to the post of Ross Mayfield]) give a proof of evidence for measuring the E20 effects with the classical ROI formula - many projects have difficulties in measuring it. As from the discussions about this problem at E20FORUM the main difficulties in measuring are perceived as the difficulties in identifying and quantifying the “net profit” from Enterprise 2.0 activities - as the nature of effects is mainly soft and intangible. As this is planned to be a major discussion at E20SUMMIT I would like to sort my ideas on this to stir up the discussions upfront.

In regards to a distinguished discussion I’d like to differentiate the notion of Enterprise 2.0 into two dimensions of impacts. In a recent German article for the T3N Magazin Martin and I have discussed (as already a lot of other people before) the characteristics of Web 2.0 apps and social software in comparison to classical “information management systems”. Besides mentioning the leveraging characteristics of being mainly open-source concepts with light-weighted architecture and a “simplified user experience for the masses” we focussed on Tim O’Reilly’s main point: the supplement of the social dimension and the network effects. This lead us to the point that the usage of Web 2.0 tools within the enterprise (as the notion of Enterprise 2.0) results into a more transparent and outward focussed information gathering that itself implies again a more transparent and effective collaboration. We quoted Lee Bryant at this point who is talking always about the change from a world of “content objects & processes” towards world of “feeds & flows”. So in regards to the ROI discussion we have therefore to distinguish the impact on information management & distribution within the enterprise from the impacts on collaboration.

At this point I would like to focus on the part of “information management & distribution” as this is a precondition for the impacts on collaboration and also seen as the more difficult part to measure.

Measuring the value of information management & distribution

For the further discussion I’d like to equate the term of “information distribution” to the technical dimension of “communications” - leaving out the social, emotional and intential aspects of communications. Why am I doing this? Because the “communications” discipline within the enterprise has a long time existant valuation problem which is recently addressed by “value based” approaches (see a explanation on “value based management”) that might be very suitable towards the valuation of Enterprise 2.0 effects.

At least within the German speaking PR community there is a controlling (or better KPI) model - based on the ideas of Walter K. Lindenmann and Norton/Kaplan. The latter have discussed a “strategy map“, a concept that illustrates the causes and effects on the building of business values. “The strategy map links the long-term game plan or competitive strategy of a business with its operational activities.”

In referring to this strategy map and its different “perspectives” Walter K. Lindenmann has developped a three-level KPI model for the valuation of PR effects, that constitutes the foundation of valuation for the IPR toolkit (IPR = Institute of Public Relations) as well as the German PR association (GPRA / more German background papers at CommunicationControlling.de). The model consists of three interdependent levels of impact:

1. output level: e.g. questions whether the message has reached its target group
2. outgrowth level: e.g. questions whether the message has been perceived and understood
3. outcome level: e.g. questions whether the message has changed the knowledge, opinion or behavior of the target group

As this model is not including any reference to the financial dimension of the strategy map Lothar Rolke added in article in 1997 the term “outflow” as a forth level that questions the business effects. While the GPRA is nowadays not differentiating between level 2 & 3 and therefore proclaims only a three-level model (output / outgrowth & outcome / outflow), for a further discussion on how Enterprise 2.0 is effecting the business value a differentiated four-level model would be more suitable.

The connecting pieces of these levels are the “value links” that constitute a causes and effects diagram like this example for the “value links” in communications by Mirko Lange:

I won’t translate this model as it is only a fictional examples of a value link system. Actually the causes and effects differ from industry to industry and from company to company - as the value generation differs in all kinds.

I first heard about the practice of this model in a non-PR context from the people of aexea at our Swiss Intranet Management FORUM about Intranet governance & controlling. They are using it to evaluate the effects of an Intranet project which in return resemble the targets of Enterprise 2.0 projects but mainly driven from a centralized viewpoint of organizing it.

As from the common practice of working with this model they have added a input level to the diagram that discribes the denominator of the classical ROI formula in terms of costs for the Intranet management. “Output” describes the produced content by the input - in quantity, frequency, reach & actuality, comprehensability & usability. “Outgrowth” explains the perceived messages from Intranet output - measured for example by the knowledge about the contents of the distributed messages/information. “Outcome” indicates the effects from the “outgrowth” in regards to the changed behavior in terms of participation in any Intranet services. At the top of the model “outflow” pictures the business effects of the changes in behavior.

Evaluation approach towards Enterprise 2.0 activities

Returning to the starting point I think this model is a very good approach in describing the effects of the impacts of E20 activities on the corporate “information managenet & distribution”. In contrast towards the classical ROI formula the model takes into account the “soft effects” of the activities.

In the following I put together some potential key indicators on the (for me) four main E20 activities: tagging, blogging, “wiki”-ing and “social network”-ing:

I think this little practice shows quite nicely that using a more differentiated approach to the valuation of Enterprise 2.0 is very useful as it illustrates the achievements made in an earlier stage.

During the last week I was pushing the finalization of the first draft of the programm for the Enterprise 2.0 SUMMIT (still waiting for some feedback from my advisory board!). We are still far away of having a complete speaker’s list but we have thoroughly discussed the topics for the conference (you might want to have a sneak preview at looking at this Google Doc!) - as this is the foundation to select the right cases and speakers. While researching a little for this matter I came along an older post of Susan Scrupski from the ITINSIDER blog: “Reality Check 2.0” - that she wrote in Nov last year as the on-going economic downturn had not yet reached the sentiments of the E2.0 evangelists in the US. It’s a very good analysis of the situation esp. the comparison towards former IT development like the emergence of BPM, Outsourcing or ERP during the economic crisis of the late 80s and early 90s:

Now, no disrespect to my late GenX and GenY readers and friends, but Boomers have some experience here that may prove helpful. Those of us who were engaged in the technology workforce in the late 80s and early 90s had to move fast to help our customers cut costs and work smarter. For me, that meant the birth of Business Process Reengineering and Outsourcing. For others, it meant the birth of Enterprise Resource Planning or ERP. Now, you could argue whether any or all of these initiatives actually delivered the results intended, but the fact remains: lots of software developers and consultants made a huge market in downtime adversity.

From there she argues by citation of some other E2.0 thought leaders as Mike Gotta and Stowe Boyd that E2.0 could be a chance to lead towards “business transformation” (as mentioned by Mike Gotta) or to “reinvent the Enterprise IT” (phrased by Stowe Boyd) if focused on the bottom line. Mike Gotta answered to this in a later post that it’ll be “time for ‘pragmatic due diligence’ when it comes to social software”.

As from my observations for Europe and esp. Germany I can firmly support the line that some E2.0 enthusiast need to get more realistic on what can be achieved with Enterprise 2.0. A lately discussion (unfortunately only in German) in our XING Enterprise 2.0 group shows how theoretical and therefore “soft” the discussion is about the outcome of Enterprise 2.0. But then I also have to adjust that as Europe and esp. Germany is always lagging behind the adoption of new web-based business ideas and esp. Germans are more critical about innovation the hype about new approaches never reaches that far as in the US - therefore we are probably already closer to the bottom line. But still the discussions about the potentials regarding Enterprise 2.0 are not anymore concrete than in the US. And a lot of people are looking for the savior when it comes towards Enterprise 2.0.

The last two Enterprise 2.0 FORUMs have shown that there are some reoccuring characteristics of sucessful perceived E2.0 projects that - from a qualitative perspective - might turn out to be the critical success factors. In regards to our on-going discussions about the topics of the Enterprise 2.0 programm I would therefore like to make some summing-up on these aspects:

• Competitive ways towards Adoption: Mike Gotta brings it towards a nice point: “IT organizations usually follow a Plan-Build-Run framework that often means Plan-Build-Runaway after the system is deployed. But since many social applications are not transactional or process-specific in a traditional sense [..] it means we need to establish methods around adoption practices to gauge how people really get work done and how work models change as a result of social applications.”  IMHO social applications always rely on the momentum of the interaction of a critical mass therefore the good old P-B-R will tend to be less successful than more hands-on approaches like “think big and start small”. For this I always like to refer towards a conversation with JP Rangaswami at reboot last year (that I have unfortunately not have registered!). He explained to me that he is quite fine with people installing and trying out new applications. Choosing the right technology is a competitive approach - the winner is the solution that has the biggest impact and critical mass.
• Leveraging the power of feedback: At the last Enterprise 2.0 FORUM Frank Schönefeld brought up a nice systematization for the feedback mechanisms of social applications. It structures the benefits of feedback on five levels (from the more concrete to less concrete) :  “social creation” (benefits from the collective intelligence and actions in creating information, cross-links etc), direct feedback (benefits from cross-linking people and information by trackbacks, comments, bookmarks and feed subscriptions), systemic feedback (benefits from new relations/interconnections between people and information) and social feedback (benefits from gaining positive feedback, authority and acknowledgement). So IMHO the success of projects tends to relate to the realized level of these feedback mechanisms.
• Changing organizational patterns: At CeBIT there has been a nice panel discussion on the “Future Workplace” including the above mentioned Frank Schönefeld as well as Dion Hinchcliffe, Willms Buhse and Philip Vanhoutte. Moderated by Sascha Alexander (Computerwoche.de) they talked about the changes that are deriving to companies as Enterprise 2.0 and GenX/GenY are entering the workspace. The focal point of the discussion led to new organizational patterns (more remote, open and collaborative, project-based, interdisciplinary working) that have to be created within the enterprises to lever the potentials of Enterprise 2.0.
• Being Complementary and Integrative: This is probably common sense for all IT-based activities but from the critics regarding the E2.0 hype paroles this need to be said: No one can run a business only with social applications - social applications are a supplement and enhancement for existing information technology. Therefore it needs to be integrate at some point with business applications to be business-critical in the long run.

Well - these are my 2 cents on “Enterprise 2.0″ and the economic crisis. BTW - I guess I will choose the title of this post as the title of the introduction panel for the Enterprise 2.0 SUMMIT. As this discussion might be a good start for the conference.