The Corporate Face of Web 2.0
The term 'Web 2.0' has been a catch-word in the Internet arena world for a while, yet its definition remains elusive. In the end Web 2.0 is perhaps self-defined by applications which it has popularized; among these are blogs, social networking, RSS, podcasts, wikis, and content tagging. And while the public face of Web 2.0 may be generated by sites such as MySpace which seem to be about as far from the corporate world as one can get, as the recent adoption of blogs in that sphere shows, Web 2.0 and its defining applications are making it to the more mainstream corporate world. Forrester Research and BusinessWeek both addressed this directly last month; Forrester in two reports and BusinessWeek in a special report.
For both its reports "Forrester conducted an online survey of 119 CIOs at firms with 500 or more employees," and "inquired specifically about six technologies: blogs, wikis, podcasts, RSS, social networking, and content tagging." The first of the two reports shows the inroads these Web 2.0 technologies have made into the corporate world; of the 119 CIOs 106 were using at least one of the six technologies.
Most of the press on the topic of corporate adoption of Web 2.0 has focused on its collaborative nature and the effect this has on increasing productivity in the enterprise; Forrester notes this as well, but as the title of the report, "Efficiency Gains and Competitive Pressures Drive Enterprise Web 2.0 Adoption" suggests, efficiency is not the only factor. Though not the only factor, "Efficiency gain is the number one reason for Web 2.0 adoption;" 74 percent of respondents said they had adopted the Web 2.0 applications in their stable because, "It improves the efficiency of our business." Due to the press stressing this aspect of Web 2.0 technologies these numbers may not be too surprising; what is interesting is the role the second driver played; 64 percent cited "Competitive Pressures" as a reason for adoption.
In fact in a certain breakdown of the data, competitive pressure actually ties with efficiency. "Among the largest companies, those with 5,000 or more employees, competitive pressure was cited as an adoption driver 74 percent of the time." This was surprising even to the report's author Oliver Young; a piece in ComputerWorld states Young, "was surprised by the number of CIOs who responded that their use of the tools was driven in part by the risk of losing market share unless they keep up with competitors’ use of the technology." This finding might lead some to the conclusion that the present state of Web 2.0 in the corporate environment is not indicative of true acceptance, but rather that it is merely something enterprises are trying out for the moment and largely based on fear of falling behind the competition. Forrester , however, is quick to point out that, only four percent of the total respondents report having held off on adoption due to feelings that, "the technology is a passing fad." Data from the second Forrester report back this up and shed some light on what might propel adoption even further.
The second report from March finds that corporations are indeed interested in acquiring Web 2.0 technologies, but in order to feel more comfortable doing so two factors in the ecosystem must be addressed. Corporate CIOs want the technologies to come bundled as a suite and they want these delivered from major incumbent vendors. Of interviewed CIOs 74 percent stated they would be "more interested" in these technologies if they came as a suite and 71 percent expressed the same if the technologies came from a "major incumbent vendor like Microsoft or IBM". (For those corporations using all six of the technologies now, the number jumped to 93 percent.) Forrester's take on the need for suites is that it is due to integration issues, "Most firms we interviewed cited integration, between both individual Web 2.0 solutions and with their overall infrastructure, as a major concern." Multiple factors were cited in regards to CIOs wanting the technologies to come from major vendors. CIOs indicated a lack of professionalism on the part of some smaller companies as well as doubt that smaller companies will be able to weather the storm; the technologies are here to stay, but will the companies remain? Some of the findings of these two reports was actually hinted at in an earlier report which looked specifically at one of the Web 2.0 technologies.
In January, Forrester released a report entitled, "Wikis Change the Meaning of 'Groupthink.'" For those not in the know, a wiki can be defined as, "a web application that allows users to add content, as on an Internet forum, but also allows anyone to edit the content. Wiki also refers to the collaborative software used to create such a website." This definition comes straight from the wiki's face on the Web, the popular Wikipedia. In the report Forrester stated that the collaboration which wikis allow was helping them move into the corporate world, "Until the arrival of wikis, tools allowing such close collaboration, in near real time, on a single version of a piece of content simply weren’t available." The adoption that the more recent reports indicate is occurring was not unexpected; in the earlier report Forrester predicted, "Wiki technology adoption will accelerate rapidly during the next 12-18 months." They also predicted that, "wiki software products will not survive as a standalone segment of the technology market;" the need for suites and offerings from larger vendors was foreshadowed months ago.
As stated earlier, Forrester is not the only one to notice Web 2.0's movement into the office; the week before Forrester released its reports last month BusinessWeek ran a special report on wikis.
One of the BusinessWeek articles comprising the special report states that though wikis have "been used by corporations for a few years, they're making deeper inroads lately and are gradually rewriting the rules of collaboration at companies as varied as Sony, Xerox, Disney and Microsoft." Andrew McAfee, a Harvard Business School professor specializing in technology and management operations told BusinessWeek , "If you did a comprehensive survey of Fortune 1,000 companies, you would probably find some sort of wiki in all of them." Sony PlayStation uses wikis internally to collaborate on new products, Motorola used a wiki to tap the collective knowledge of its customers to fashion a definitive user guide for its Q mobile phone, one of Intel's internal wikis, Intelepedia, "has amassed 5,000 pages of content and garnered 13.5 million page views." Though, "wikis may not be for everyone, their versatility and ease of use has rapidly made them an essential corporate tool." Another article in the special report places this in context.
The second BusinessWeek article discussed how grassroots movements within two companies, Frankfurt-based investment bank Dresdner Kleinwort and Finnish handset-maker Nokia, led to successful wiki implementations. Back in 2004 two small groups within Nokia's Research Center in Helsinki created their own wikis, "Today, Nokia estimates at least 20 percent of its 68,000 employees use wiki pages to update schedules and project status, trade ideas, edit files, and so on." Use at Dresdner Kleinwort shows similar results; "In March, 2006, the Dresdner Kleinwort wiki had 20,000 monthly hits. By October, that number had quintupled." The article concludes, "If the experience at Dresdner Kleinwort and Nokia is any indication, wikis could soon spread throughout much of the corporate world."
Of course, there is a downside to this as well. "Over time, as wikis begin to get a critical mass of information, they tend to sprawl and become unwieldy," says BusinessWeek. According to Ann Majchrzak, professor of information systems at the Marshall School of Business at the University of Southern California, "You need some kind of person who sees the long-term consequences of not organizing." Though wikis, and other Web 2.0 technologies, may improve collaboration and efficiency, only time will tell if this trend will continue and reveal if they find their place within the corporate environment.
A more complete version of this posting, with journal articles, and research reports can be found at the website of Analyst Views Weekly.
More information on this topic can be found in the Software section of Northern Light's Software, Computers, & Services Market Intelligence Center.
And in the following articles:
Web 2.0 Taking Off with Businesses
Silicon.com, March 23, 2007
Web 2.0 technologies are becoming increasingly popular with businesses as they start to understand its benefits following their initial investment in the technology. More than three-quarters of execs surveyed by consultants McKinsey said they intend to maintain or increase investment in collaborative web-based technologies.
Companies Like Web 2.0 Tech--But from Big Vendors
CNET, March 22, 2007
Forrester Research published a report this week with a classic good news-bad news conclusion for Web 2.0 start-ups: corporate buyers want Web 2.0 technologies but they'd rather buy from bigger vendors. The IT research company surveyed 119 chief information officers at companies with more than 500 employees and found a strong appetite for Web 2.0 technologies, including software for blogs, wikis, podcasts, RSS, social networking and content tagging.
Study: CIOs Use Web 2.0 to Keep Up with Competition
ComputerWorld, March 20, 2007
Web 2.0 is more than just a passing fad for consumers, with adoption of technologies like wikis and RSS making their way into businesses facing competitive pressures if they don't embrace the emerging collaborative tools, according to a recent survey of CIOs. In its survey, Forrester Research Inc. said that 106 of 119 CIOs from companies with more than 500 employees were using at least one of these Web 2.0 technologies: blogs, wikis, podcasts, RSS, social networking and content tagging. CIOs said that adoption is being driven by gains in worker efficiency and fear of competitive pressures.
No Rest for the Wiki
BusinessWeek Online, March 12, 2007
Welcome to the world of corporate wikis. The sites that make it easy for people to add and edit information have revolutionized encyclopedia creation, evidenced by the growth of Wikipedia. And though they've been used by corporations for a few years, they're making deeper inroads lately and are gradually rewriting the rules of collaboration at companies as varied as Sony, Xerox, Disney, and Microsoft. "If you did a comprehensive survey of Fortune 1,000 companies, you would probably find some sort of wiki in all of them," says Andrew McAfee, a Harvard Business School professor specializing in technology and management operations.
Corporate Wikis Go Viral
BusinessWeek Online, March 12, 2007
About two years ago, a handful of tech-savvy employees at two very different European companies began dabbling in the use of wikis—collaborative tools that let you build Web pages that allow users to edit documents, share ideas, or monitor the status of a project. Within months, the skunkworks had spawned so many Wiki pages that each company decided to launch an official company wiki. While the experience of both companies suggests wikis may not be for everyone, their versatility and ease of use has rapidly made them an essential corporate tool.
Wikipedia Founder Says to Challenge Google, Yahoo
Reuters, March 8, 2007
The on-line collaboration responsible for Wikipedia plans to build a search engine to rival those of Google Inc. and Yahoo Inc., the founder of the popular Internet encyclopaedia said on Thursday. Wikia Inc., the commercial counterpart to the non-profit Wikipedia, is aiming to take as much as 5 percent of the lucrative Internet search market, Jimmy Wales said at a news conference in Tokyo.
Do You Play Tag Online?
PC World, February 1, 2007
Tagging, the emblematic activity of the "Web 2.0" and social-computing era, appears destined for mainstream status, a new study concludes. Among U.S. Internet users, 28 percent have tagged content online, such as blog entries, photos, Web sites, video clips, and news articles, The Pew Internet & American Life Project reports in a study released this week. On any particular day, 7 percent of users engage in this activity to categorize and label material that they upload or find on the Web.
For both its reports "Forrester conducted an online survey of 119 CIOs at firms with 500 or more employees," and "inquired specifically about six technologies: blogs, wikis, podcasts, RSS, social networking, and content tagging." The first of the two reports shows the inroads these Web 2.0 technologies have made into the corporate world; of the 119 CIOs 106 were using at least one of the six technologies.
Most of the press on the topic of corporate adoption of Web 2.0 has focused on its collaborative nature and the effect this has on increasing productivity in the enterprise; Forrester notes this as well, but as the title of the report, "Efficiency Gains and Competitive Pressures Drive Enterprise Web 2.0 Adoption" suggests, efficiency is not the only factor. Though not the only factor, "Efficiency gain is the number one reason for Web 2.0 adoption;" 74 percent of respondents said they had adopted the Web 2.0 applications in their stable because, "It improves the efficiency of our business." Due to the press stressing this aspect of Web 2.0 technologies these numbers may not be too surprising; what is interesting is the role the second driver played; 64 percent cited "Competitive Pressures" as a reason for adoption.
In fact in a certain breakdown of the data, competitive pressure actually ties with efficiency. "Among the largest companies, those with 5,000 or more employees, competitive pressure was cited as an adoption driver 74 percent of the time." This was surprising even to the report's author Oliver Young; a piece in ComputerWorld states Young, "was surprised by the number of CIOs who responded that their use of the tools was driven in part by the risk of losing market share unless they keep up with competitors’ use of the technology." This finding might lead some to the conclusion that the present state of Web 2.0 in the corporate environment is not indicative of true acceptance, but rather that it is merely something enterprises are trying out for the moment and largely based on fear of falling behind the competition. Forrester , however, is quick to point out that, only four percent of the total respondents report having held off on adoption due to feelings that, "the technology is a passing fad." Data from the second Forrester report back this up and shed some light on what might propel adoption even further.
The second report from March finds that corporations are indeed interested in acquiring Web 2.0 technologies, but in order to feel more comfortable doing so two factors in the ecosystem must be addressed. Corporate CIOs want the technologies to come bundled as a suite and they want these delivered from major incumbent vendors. Of interviewed CIOs 74 percent stated they would be "more interested" in these technologies if they came as a suite and 71 percent expressed the same if the technologies came from a "major incumbent vendor like Microsoft or IBM". (For those corporations using all six of the technologies now, the number jumped to 93 percent.) Forrester's take on the need for suites is that it is due to integration issues, "Most firms we interviewed cited integration, between both individual Web 2.0 solutions and with their overall infrastructure, as a major concern." Multiple factors were cited in regards to CIOs wanting the technologies to come from major vendors. CIOs indicated a lack of professionalism on the part of some smaller companies as well as doubt that smaller companies will be able to weather the storm; the technologies are here to stay, but will the companies remain? Some of the findings of these two reports was actually hinted at in an earlier report which looked specifically at one of the Web 2.0 technologies.
In January, Forrester released a report entitled, "Wikis Change the Meaning of 'Groupthink.'" For those not in the know, a wiki can be defined as, "a web application that allows users to add content, as on an Internet forum, but also allows anyone to edit the content. Wiki also refers to the collaborative software used to create such a website." This definition comes straight from the wiki's face on the Web, the popular Wikipedia. In the report Forrester stated that the collaboration which wikis allow was helping them move into the corporate world, "Until the arrival of wikis, tools allowing such close collaboration, in near real time, on a single version of a piece of content simply weren’t available." The adoption that the more recent reports indicate is occurring was not unexpected; in the earlier report Forrester predicted, "Wiki technology adoption will accelerate rapidly during the next 12-18 months." They also predicted that, "wiki software products will not survive as a standalone segment of the technology market;" the need for suites and offerings from larger vendors was foreshadowed months ago.
As stated earlier, Forrester is not the only one to notice Web 2.0's movement into the office; the week before Forrester released its reports last month BusinessWeek ran a special report on wikis.
One of the BusinessWeek articles comprising the special report states that though wikis have "been used by corporations for a few years, they're making deeper inroads lately and are gradually rewriting the rules of collaboration at companies as varied as Sony, Xerox, Disney and Microsoft." Andrew McAfee, a Harvard Business School professor specializing in technology and management operations told BusinessWeek , "If you did a comprehensive survey of Fortune 1,000 companies, you would probably find some sort of wiki in all of them." Sony PlayStation uses wikis internally to collaborate on new products, Motorola used a wiki to tap the collective knowledge of its customers to fashion a definitive user guide for its Q mobile phone, one of Intel's internal wikis, Intelepedia, "has amassed 5,000 pages of content and garnered 13.5 million page views." Though, "wikis may not be for everyone, their versatility and ease of use has rapidly made them an essential corporate tool." Another article in the special report places this in context.
The second BusinessWeek article discussed how grassroots movements within two companies, Frankfurt-based investment bank Dresdner Kleinwort and Finnish handset-maker Nokia, led to successful wiki implementations. Back in 2004 two small groups within Nokia's Research Center in Helsinki created their own wikis, "Today, Nokia estimates at least 20 percent of its 68,000 employees use wiki pages to update schedules and project status, trade ideas, edit files, and so on." Use at Dresdner Kleinwort shows similar results; "In March, 2006, the Dresdner Kleinwort wiki had 20,000 monthly hits. By October, that number had quintupled." The article concludes, "If the experience at Dresdner Kleinwort and Nokia is any indication, wikis could soon spread throughout much of the corporate world."
Of course, there is a downside to this as well. "Over time, as wikis begin to get a critical mass of information, they tend to sprawl and become unwieldy," says BusinessWeek. According to Ann Majchrzak, professor of information systems at the Marshall School of Business at the University of Southern California, "You need some kind of person who sees the long-term consequences of not organizing." Though wikis, and other Web 2.0 technologies, may improve collaboration and efficiency, only time will tell if this trend will continue and reveal if they find their place within the corporate environment.
A more complete version of this posting, with journal articles, and research reports can be found at the website of Analyst Views Weekly.
More information on this topic can be found in the Software section of Northern Light's Software, Computers, & Services Market Intelligence Center.
And in the following articles:
Web 2.0 Taking Off with Businesses
Silicon.com, March 23, 2007
Web 2.0 technologies are becoming increasingly popular with businesses as they start to understand its benefits following their initial investment in the technology. More than three-quarters of execs surveyed by consultants McKinsey said they intend to maintain or increase investment in collaborative web-based technologies.
Companies Like Web 2.0 Tech--But from Big Vendors
CNET, March 22, 2007
Forrester Research published a report this week with a classic good news-bad news conclusion for Web 2.0 start-ups: corporate buyers want Web 2.0 technologies but they'd rather buy from bigger vendors. The IT research company surveyed 119 chief information officers at companies with more than 500 employees and found a strong appetite for Web 2.0 technologies, including software for blogs, wikis, podcasts, RSS, social networking and content tagging.
Study: CIOs Use Web 2.0 to Keep Up with Competition
ComputerWorld, March 20, 2007
Web 2.0 is more than just a passing fad for consumers, with adoption of technologies like wikis and RSS making their way into businesses facing competitive pressures if they don't embrace the emerging collaborative tools, according to a recent survey of CIOs. In its survey, Forrester Research Inc. said that 106 of 119 CIOs from companies with more than 500 employees were using at least one of these Web 2.0 technologies: blogs, wikis, podcasts, RSS, social networking and content tagging. CIOs said that adoption is being driven by gains in worker efficiency and fear of competitive pressures.
No Rest for the Wiki
BusinessWeek Online, March 12, 2007
Welcome to the world of corporate wikis. The sites that make it easy for people to add and edit information have revolutionized encyclopedia creation, evidenced by the growth of Wikipedia. And though they've been used by corporations for a few years, they're making deeper inroads lately and are gradually rewriting the rules of collaboration at companies as varied as Sony, Xerox, Disney, and Microsoft. "If you did a comprehensive survey of Fortune 1,000 companies, you would probably find some sort of wiki in all of them," says Andrew McAfee, a Harvard Business School professor specializing in technology and management operations.
Corporate Wikis Go Viral
BusinessWeek Online, March 12, 2007
About two years ago, a handful of tech-savvy employees at two very different European companies began dabbling in the use of wikis—collaborative tools that let you build Web pages that allow users to edit documents, share ideas, or monitor the status of a project. Within months, the skunkworks had spawned so many Wiki pages that each company decided to launch an official company wiki. While the experience of both companies suggests wikis may not be for everyone, their versatility and ease of use has rapidly made them an essential corporate tool.
Wikipedia Founder Says to Challenge Google, Yahoo
Reuters, March 8, 2007
The on-line collaboration responsible for Wikipedia plans to build a search engine to rival those of Google Inc. and Yahoo Inc., the founder of the popular Internet encyclopaedia said on Thursday. Wikia Inc., the commercial counterpart to the non-profit Wikipedia, is aiming to take as much as 5 percent of the lucrative Internet search market, Jimmy Wales said at a news conference in Tokyo.
Do You Play Tag Online?
PC World, February 1, 2007
Tagging, the emblematic activity of the "Web 2.0" and social-computing era, appears destined for mainstream status, a new study concludes. Among U.S. Internet users, 28 percent have tagged content online, such as blog entries, photos, Web sites, video clips, and news articles, The Pew Internet & American Life Project reports in a study released this week. On any particular day, 7 percent of users engage in this activity to categorize and label material that they upload or find on the Web.
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