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Why Enterprise 2.0 Will Fail

Scott Gavin recently listed the Top 3 Business Benefits of Enterprise 2.0 inside the company firewall.

  1. Personal Information/Knowledge Management
  2. Expertise Identification
  3. Collective Intelligence

I was glad to see someone discuss the internal benefits, because the E2.0 conversation lately has focused on the external benefits — how E2.0 can help marketing and sales.

The case for organizations reaching out to their audiences via social media is easy to make. If you want to improve your outreach efforts, you either have to go where the people are or create an inviting place for people to gather.

The case for E2.0 inside the firewall is considerably more difficult. As Tom Davenport points out, is essentially the case for what used to be called Knowledge Management, or KM. The term KM fell out of favor with consultants and analysts because it didn’t deliver enough of these benefits. There are a lot of folks hoping that flexible, easy-to-use “2.0″ applications might succeed where centrally managed KM failed.

But it likely won’t, because most E2.0 vendors are doing it wrong.

If the #1 benefit is personal knowledge management, why are all the big players selling to the CEO, CIO, and IT departments? Where are the tools targeting individual knowledge workers?

Missing in action

I can think of two reasons why we haven’t seen a flowering of office productivity applications.

1. The Free Brigade — Companies don’t think they can make money from ordinary people anymore. Even if software companies came up with killer applications that helped people manage their daily tasks, email and files, they don’t think they would be able to get people to pay for it. Perhaps their software will get pirated. Maybe some college students will throw together a free and/or open source version that will destroy their market. Or — the most common reason I’ve heard — is simply that employees don’t expect to pay for software they use at work.

2. The Microsoft Effect — Microsoft owns the corporate desktop computing environment. Period. Software vendors fear to challenge the hegemony of the Office Suite, afraid that they will suffer the fate of Word Perfect or Netscape or any number of other products and vendors that have tried, and failed, to break Microsoft’s lock on desktop computing. Despite the fact that Microsoft Office applications have been around for more than 15 years (an eon in software industry) and despite the fact that they have known deficiencies for managing information that the Content Management and Knowledge Management industries have exploited for years, there has been little or no direct competition in this space.

The Enterprise 2.0 distortion field

These two factors cause all Enterprise 2.0 vendors to compromise in one of two ways.

  1. While promising personal benefits to knowledge workers, they actually take their marching orders from senior management, who purchase the software.
  2. While promising to help individuals with their daily flow of information, they live in fear of deploying software to workstations and laptops, where all information is received and all the work is actually performed.

This means that most Enterprise 2.0 Software vendors violate at least two of Andrew McAfee’s criteria for an Enterprise 2.0 tool: Freeform, frictionless, and emergent.

Because many of these tools have a management bias, and will subordinate individual initiative to central control, they sacrifice being freeform and emergent. Because many of these tools will be based in the cloud to avoid the tyranny of the Microsoft desktop and corporate IT, they sacrifice the frictionless flow of information inside the firewall.

Ironically, the companies that actually deliver best on the E2.0 promise are ones that would never consider themselves enterprise software.

Related posts:

  1. Two Kinds of Enterprise Software
  2. The Slowest Way to Fail
  3. Enterprise 2.0: The Software Social


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