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Andrew: Tell us a little about your professional background. Your second book, "The Next Wave of Technologies", features lots of detailed descriptions of software system implementations and deals with various aspects of deploying new technologies. Where did you get this knowledge?
Phil: I’m a recovering consultant and recently published author. I started working on enterprise applications back in 1995 while in grad school. After a brief career in corporate HR, I started moving into technology- and system-oriented work. In 2000, I became a consultant and started working as an independent in 2002.
Over the course of the last 15 years, I have seen many organizations struggle with many types of technologies and applications. For years, I have spoken with colleagues about their technology-related challenges. Also, I learn a great deal from the guests on my podcasts. Finally, I do a great deal of reading on the intersection between people, organizations and different technologies.
Andrew: In your book, you say that when using the term “Enterprise 2.0” you mean something slightly different from the classic definition by Andrew McAfee. Could you please give your definition of this term and say why you were unhappy with what Andy McAfee proposes.
Phil: Sure. I’ll make it relatively quick. I look at intranets, e-mail and nascent attempts at ERP, CRM, BI, etc. as Enterprise 1.0. Of course, no one calls anything 1.0 at the time, right? I’m pretty sure that no one called it WWI in 1917. Only after the second did the first become WWI.
It’s not that I was unhappy with McAfee’s definition. I just thought that it was incomplete. Take BI, for example. Many organizations rolled out some type of BI initiative in the 1990s, and in fact, I was able to work on a few projects of that ilk. Much like ERP and CRM success rates, however, many BI endeavors did not do what senior management initially conceived. So, to exclude things such as open source BI, mobile BI or In-Memory BI seemed incomplete. Many, if not most, organizations still have no BI tool, and early adopters are finding ways to improve their ROI on earlier BI efforts, including using BI Competency Centers (BICCs).
I would just say that my definition of Enterprise 2.0 is a little broader than McAfee’s.
Andrew: I see your point, and I also wanted to share my point of view on McAfee’s definition. As far as I remember, McAfee’s definition of Enterprise 2.0 focuses primarily on software systems. In my view, it’s also important to account for changes in organizational culture and practices that go hand-in-hand with the adoption of these tools. This is one of the most important aspects to consider when thinking of deploying new software. You’re a consultant, and your job in many cases is helping executives to see what and where they need to change. How would you identify the need for change in an organization? Let’s say there’s an organization where an Enterprise 1.0 system works quite well, and workers feel like they are happy with it. Do they still need to innovate?
Phil: The need for change fascinates me. At times, it’s completely apparent. At other times, it’s less clear. Let’s look at the first scenario.
In “An Executive's Guide to Information Technology: Principles, Business Models, and Terminology,” Robert Plant and Stephen Murrell define a legacy system as one that can no longer meet an organization’s needs. I have seen many people very happy with their homegrown systems or legacy apps because, in their view, it works quite well and they like it. That’s a far cry from saying that it meets the needs of the business. It’s hard to argue that today a clunky 1980s app without adequate reporting, e-mail, etc. meets an organization’s needs.
Now, let’s look at a more contemporary system with a decent number of bells and whistles. Is the organization “set”? I’d argue that it’s hard to say. What if a SaaS-based or open source equivalent can meet the same business needs at a lower cost (both out of pocket to the vendor and in terms of employee salaries)? Isn’t the organization beholden to at least investigate what’s out there?
So, with respect to innovation, the answer is a qualified yes. Enterprise 2.0 and Web 2.0 technologies allow for so much innovation that I don’t see how you can say, “We’re set.” At the same time, though, innovation for the sake of innovation isn’t a great idea. It all comes down to whether the current apps and technologies can meet an organization’s needs.
Andrew: Right. In your book you say that there are important issues that people who choose to adopt Enterprise 2.0 will face. Can you say more about this and why you think that these issues should not scare executives away?
Phil: Absolutely. Let’s take two white hot technologies at the moment: social media and cloud computing.
Social media makes many organizations uncomfortable because they lose control of the message. As Jay Miletsky points out in the chapter, allowing others to create content related to your brand, organization and products takes many people out of their comfort zone. Miletsky writes that "negative comments, of course, are visible and available for anybody on the network to see -- not exactly the kind of notoriety that most organizations want to be made public."
With regard to cloud computing, organizations no longer have their data within the fire wall. Amy Wohl does a great job of explaining some of the security, technical and political issues that organizations face when their data resides elsewhere. Wohl writes that that "early adopters (of cloud computing) will want to make certain that the clouds they choose offer the level of security and governance they require."
You’re right. These issues shouldn’t frighten CXOs. Digital music scared the record companies. Open source scares Microsoft. The point is that these vast technological changes are taking place. You can deny that they are happening, or you can understand them and how they can potentially help your organization. In a sentence, that’s what “The Next Wave of Technologies” is all about.
Andrew: A considerable part of your book is dedicated to the role of IT in Enterprise 2.0 implementation. Could you please summarize the main roles the IT department should play when a company adopts a new technology? Do you agree that Enterprise 2.0 is a user-driven technology?
Phil: Yes, there’s a chapter on IT, and it’s a recurring theme throughout the book. In general, business and IT need to break out of their comfort zones. IT needs to understand more of the business and, quite frankly, many business users should understand more about the role of IT and specific technologies.
With respect to IT, the department and its employees are typically in a unique position: they interact with many pockets of the organization and, as such, contain a great deal of institutional knowledge. Applied correctly, IT can use this information to be more of a true partner with the lines of business.
It’s hard for me to call Enterprise 2.0 completely user-driven, and I don’t think that it should be. Imagine the chaos resulting from everyone doing everything on their own. I will say this: Look at collaborative tools, such as Yammer. Like many companies, Yammer operates on a freemium model, allowing for mass adoption of the tool within organizations. In other words, IT need not to follow its traditional “top down” procurement and roll out the process for certain technologies. Adoption of a tool such as Yammer can be more organic, more “bottom up.” To that extent, yes, Enterprise 2.0 can be user-driven.
Andrew: This is close to the more generic idea of blending top-down and bottom-up approaches to management. I wrote a post on it before with a main thesis revolving around the fact that an organization needs both bottom-up knowledge and top-down guidance to become adaptive and more competitive in the present economy. In my opinion, the main advantage of the Enterprise 2.0 systems is that they make organizations more transparent. I guess this is the core change that Enterprise 2.0 brings to organizational culture. Do you believe that technologies can change the way business is done? In other words, do you think that the change in technologies involves changes in processes and in the way people act at work?
Phil: It’s folly to assume that a transformative technology will always leave current business processes untouched. I’ve seen organizations cling to, let’s say, “less than current” methods because that’s how they did things around there. They didn’t know another, better way. As a result, they were unable to successfully utilize their new systems and applications.
Take collaborative tools, such as wikis. They have made working on international projects easier by an order of magnitude, as Jason Horowitz points out. "Wikis are an outstanding way to work remotely...allow[ing] individuals to make changes to documents on their schedule while building on the work of colleagues in other locations." Foolish is the organization that doesn’t ask fundamental questions about how Enterprise 2.0 technologies can help improve the current business processes.
Andrew: Phil, thank you for sharing your point of view. It was a pleasure to talk. For our readers I’d like to note that, if you liked Phil’s ideas and want to find out more, you are welcome not only to take a look at his upcoming book "The Next Wave of Technologies: Opportunities in Chaos"; but also win a copy of it by leaving a comment on this post! The author of the best comment will get a book with Phil's signature.