By Matthew Fraser, Soumitra Dutta, 22 January 2009 09:00
COMMENT
In 2003, Zuboff and husband Jim Maxmin published a new book, The Support Economy: Why Corporations Are Failing Individuals and the Next Episode of Capitalism, which argued that the potential of information technology failed because of resistance by the corrupted culture of "managerial capitalism".
"Managers are at the centre, preoccupied with their own interests," said Zuboff. "But their path has become corrupted, they are insulated and have become a source of governance catastrophes."
So is the enterprise 2.0 model for real this time? Many CEOs are intrigued by the business case for enterprise 2.0. Surveys conducted by consulting firms like McKinsey and Forrester Research reveal that executives are showing openness to web-based collaboration and social networking tools. Forrester forecasts robust corporate spending on web 2.0 software - including blogs, mashups, podcasts, RSS, widgets and wikis. It projects consolidated web 2.0 spending growth at 43 per cent annually - from $764m in 2008 to $4.6bn in 2013.
Still, it can hardly be claimed that Fortune 500 companies - with the exception of a small clutch of leading-edge giants like IBM - are stampeding to join a web 2.0 juggernaut. Moreover, while $4.6bn looks like a big number, it's only a tiny fraction - less than one per cent - of global corporate spending on enterprise software.
Companies have tended to invest mainly in back-end technologies that enable web-based automation, while remaining paranoid about losing control if social networking tools like wikis and blogs become standard work tools. For many corporate executives, the enterprise 2.0 model means profoundly rethinking how they structure, organise and manage their organisations. And that challenge is potentially destabilising.
How can we explain the lag between the bold ambition of the enterprise 2.0 vision and the slow pace of its adoption?
One possible explanation is that corporate executives simply don't understand enterprise 2.0. Corporate executives, in other words, just don't get it. Many senior managers mistakenly believe enterprise 2.0 is a product, like the latest Microsoft Office suite. They don't understand that enterprise 2.0 is not a cost centre, but rather a state of mind - a revolutionary new way of managing companies and conducting business. Enterprise 2.0 evangelists believe that old-style, hierarchical corporations have a 'DNA problem' with web 2.0.
Harvard business professor Andrew McAfee, who has written extensively about enterprise 2.0 issues, attributes resistance towards social technologies to the fact that they have little regard for organisational boundaries, hierarchies and job titles. "They facilitate self-organisation and emergent rather than imposed structure," he notes, adding that web 2.0 tools require a "re-examination and often the reversal of many longstanding assumptions and practices."
A second possible explanation is that executives consider enterprise 2.0 to be little more than a trendy buzzword. Whatever the promise of web 2.0 tools, many corporate mangers regard blogs, wikis and social networks as an intriguing distraction at best, and a serious security risk at worst. Employee dismissals for spending work time on sites like Facebook are, as noted, becoming disturbingly frequent. In Britain, a survey of 3,500 firms revealed that using Facebook and other social networking sites costs the national economy roughly $255m per day in "wasted time".
It's not difficult to find an internet security firm that, hoping to boost sales of its web 2.0 blocking software, strongly urges corporations to crack down on online social networking. The list of potential downside risks is indeed alarming: virus and spyware infections, data leaks, illegal activities, reputational damage, to name only a few. Web security specialists have made a business from playing on the worst fears of corporate managers.
A third possible explanation is that corporate executives understand enterprise 2.0 only too well - and that's precisely why they fear it. This theory interests us most here, since we are examining the web 2.0 e-ruption's implications for power relationships - specifically, the diffusion of power from vertical hierarchies towards horizontal networks. From a strictly structural point of view, corporate executives used to managing top-down hierarchies naturally distrust horizontal networks because they are difficult to control. Try telling a senior executive that, going forward, there will be no more job titles, reporting lines and organisational boundaries in the company.
There is evidence however that resistance to web 2.0 tools doesn't come from top executive suites but from middle managers and corporate IT departments. In a paper titled "Enterprise 2.0: Fad or Future?", Gary Matuszak of KPMG International notes that, apart from familiar concerns about security risks, the real problem is corporate culture. "Just as damaging are institutional cultures or norms that work against sharing information, either because of concerns about confidentiality or because of hierarchical structures," observed Matuszak.
Click here for the next page
Comments
There are 3 comments. Join the discussion
1. Anil Prajapati
Thank you for providing information about this book and I will surely read the book in near time.
It is the fact that Enterprise2.0 adoption will take some time to capture its space in most of the enterprises (especially from India). The organizational culture and policies will take its own time to change. There are companies where accessing personal e-mail, chat messengers are restricted. While framing such policies, companies wanted to restrict their employees to waste their productive time in such ‘addictive’ internet related activities. Yes chatting and e-mailing was an addictive activity in initial days.
Now the time has come where employees are on the internet for all long hours and they do no have time to reply a friend’s e-mail, they avoid coming up on messengers, Mobile phone has replaced abolished internet’s addictiveness.
The innovative providers in the space of Enterprise2.0 or Web2.0, are actively coming up with newest best possible application / solutions for the companies to embrace Enterprise2.0 by building a social eco-system within an organization.
I hope my few cents will be helpful for the readers here.
2. Ian Hendry
Great article that details an interesting book.
The benefits of Web 2.0 are possible even greater for the SME market though. Turn your customers, be they consumers or other businesses, into fans and they can assist you in your marketing across all social sites, bringing you access to a much greater market for nothing. Better still, it comes with the added power of referral marketing.
An increasing amount of web traffic is driven now by what people see their "friends" and contacts doing, rather than what they find on Google. Ignore Web 2.0 and you could be missing a hugely influencial new audience helping drive traffic to your site.
Ian Hendry
CEO, WeCanDo.BIZ
3. anonymous
There is so much to grasp in this article - the corporate ladder, the way in which communications are managed & also the perceived threat to existing managerial structures within a business - all of these points have huge relevance to way in which these new technologies will be adopted.
With ever increasing pressures being placed on costs & efficiencies, the sharing of IP and development of new markets for this may help give enterprise technologies the USP that helps shift the emphasis away from threat and more towards opportunity.
Darren Pearce
VoloGroup