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Archive for November 11th, 2010

Heretical Thinking: Enterprise 2.0 is Dead

Posted by Bob Warfield on November 11, 2010

After reading Dennis Howlett’s piece, “Enterprise 2.0 is beyond a crock.  It’s dead,” and Andrew McAfee’s counterpoint, “Social Business is Past Retirement Age,” I found myself in the surprising position of agreeing with Dennis that E2.0 is dead.  I’m not suprised because of any issue with Dennis, I’ve been reading and enjoying his work for years, but rather because I would’ve expected to come out more on the side of E2.0 idealists.  After all, I was very recently involved in a closely related space called Social CRM, and I’m supposed to be a card-carrying “Social Guy.”  Dennis has never made a secret of his skepticism.

Where's The Beef?

Where's The Beef?

Here is my problem:  the Business Social Scene has rolled forward under the banner of the Consumerization of IT and not much else.  That’s a polite way of saying they’ve copied everything they can from Facebook, Twitter, and online BBS systems, without adding much innovation of their own.  They’ve made it possible to visit the water cooler without leaving your desk, but that’s hardly an excuse for big ROI payoff. 

Because of my past, I find myself talking to lots of companies that are interested in Social for Business.  If there is one thing that constantly surprises me, it is the sameness of their approach.  Really the only interesting new thing I’ve heard of was Chatter’s ability to have the Enterprise Software itself participate in the conversation. 

Take recent reviews of Moxie (used to be called nGenera) where two reviewers (Ben Kepes and Klint Finley) remark along these lines:

Moxie is a full-featured social suite including internal and external community sites, wikis, idea management, microblogging and more. Ben Kepes is not particularly impressed by Moxie. He lists the things Moxie told him in a briefing set it apart:

  • Pointers to people (think rich profiles and the like)
  • Rewards for participants (thinks badges and stuff – yawn)
  • Going where the people are (single sign on and enterprise integration)
  • A compelling UI (code for “we look like Facebook”)

I was basically told the same thing in my briefing, and I agree that most of this is all pretty common place – except maybe badges, which aren’t a big deal.

I saw the demo some time ago and had the same reaction.  They’re awfully late to the party to be showing a Me Too product, even if it does have a little nicer fit and finish than many.

The trouble is, almost everyone is late to this party in some sense or another because they’re all so similar.  That means that the consolidation that’s already underway (where companies like Cubetree are bought by companies like SuccessFactors) will continue or accelerate. 

There is also another disturbing tendency, and this is where Howlett’s piece really resonates and Andrew McAfee lets us down as an academic: it’s gotten to be all about faith and marketing.  When it comes to ROI, “Where’s the Beef?”  Discussions of ROI quickly turn circular:  You can’t get the ROI until everyone is participating, but once they are, we’re sure the ROI will be huge.  Dennis’ point is that in the end of the day, it’s all down to the people and their culture.  If you have a company with a culture that’s capable of embracing E2.0, you may get some value from it.  If not, fuggedhaboutit.  And this is where my problems with Andrew McAfee start.  He says the idea of a “Social Business”, is old as the hills, and E2.0 is the new new thing we have to focus on.  In talking about “Social Business” (how people behave) versus E2.0 (Tools), he pens a great passage that if I were he, I couldn’t imagine wanting to be held accountable for:

This distinction matters. It matters because telling business decision makers “There are some important new (social) technologies available now, and they’ll help you address longstanding and vexing challenges you have” is very different than telling them “Business is social, and the more deeply you embrace that fact the better off you’ll be.”

Absent any other information, I would’ve expected McAfee to immediately embrace his second statement and move on.  Wouldn’t you?  After all, it is the more profound and more accurate statement.  The first is more faith marketing from the E2.0 cheerleader’s squad.  Imagine my surprise at his next paragraph:

The former sentence, I’ve found, is pretty effective at getting their attention. The latter one is less so, because I tell you with complete certainty that they’ve heard it many many times before. It’s a message that has been broadcast into the executive suite for fourscore years now. Sometimes it’s been delivered with great skill and clarity, sometimes not. Sometimes it’s been internalized and acted on, sometimes not. But the message has been heard so often that it’s faded into the background. I’ve found that the phrases “business is social” and “people, process, and technology matter” have lost most, if not all, of their power to persuade decision makers.

Hold on Andrew, when did you cash in your academic credentials, pick up a bag, and decide your most important job was selling E2.0 software?  Aren’t you supposed to have weightier matters of the mind such as learning something new and discovering the fundamental truths of our time?  Isn’t the fundamental truth, “Business is social, and the more deeply you embrace that fact the better off you’ll be.”

Here’s the deal: we are nearing the end of the time for Faith-Based Marketing.  That’s an Early Adopter’s game.  We’re staring at the chasm and wondering how to get across.  You can’t cross the chasm with a hope and a prayer.  The folks who live on the other side of the chasm are not Early Adopters.  They don’t worship every new shiny thing.  They are more practical and pragmatic people who insist on an ROI.  Chris Yeh puts the mindset of these later adopters in a blunt but accurate fashion:

If you can’t sell more, buy less, or fire somebody, you’re not getting real ROI.

If there is one thing I learned selling Social Software, it is that the issue is very black and white.  You can’t convince people to be Social unless they already are.  There are no grays, and any company that bets its future on turning grays into blacks or whites is going to have such a high cost of Sales and Marketing they will fail.  There is a crowd that believes it’s all down to demographics.  “We just need enough Gen Y’s in decision-making positions and the world will turn Social overnight.”  There is a crowd that looks at Facebook’s 500 million people and concludes, “It’s inevitable and moreover it is here right now today!”  They are both wrong.  They are both relying on Faith rather than actively doing something new.  Remember that old definition of insanity–doing the same thing and expecting a different result.  Get off of Faith and onto ROI and you can talk shades of gray.  Chris puts the E2.0 mindset on ROI equally as bluntly:

I keep hearing that the benefits of E2.0 initiatives will take a long time to accrue and are difficult to measure, but that it’s still worth adopting because the cost of experimentation is so low.

Not to put too fine a point on it, but this is bullshit.

If we’ve been studying the Social Business for such a long time without a result, that’s a clue.  McAfee will argue that’s precisely why he has quit focusing on it and started focusing on the E2.0 world.  But that world has been here long enough too.  Lotus Notes was an E2.0 tool, for Heaven’s Sake.  A few of the E2.0 companies at the very top are doing great, most are so so, and there is a consolidation underway.  If E2.0 is the Megatrend those with the faith think, there should be so much green field that many more of these companies are hitting the ball out of the park.  We should be tee’d up for 3 or 4 IPO’s imminently, just as soon as the market opens.  I don’t get the sense we are there or even close.  We may very well have a repeat of the old Portal market, where despite many companies being in the space, only one (Plumtree) managed to have an IPO, and a tepid one at that.

As an Engineer and Products Guy, I have to comment on the software, and not just stick to the people angle.  I do believe it is possible to do what Moxie claims to have done, and that is to construct a User Experience so compelling that it drives rapid adoption.  To be clear, I don’t think they have done it, just that it is possible someone could.  The fundamental problem with the UX for these products is they start from the assumption that Generic Social is the Goal.  It ain’t the case.  Solving a real Business Problem and Delivering an ROI is the Goal.  This is the essential point McAfee is missing.  In his article, he argues putting people first is dumb because we’ve tried that and nothing happened, while:

What is novel is the digital toolkit available to help businesses and their leaders become more social, more open, more Theory Y, more Model 2, etc. In the 2.0 Era, these tools experienced a quantum leap forward, not an incremental improvement. Because business is so social, this quantum leap is a big deal.

Andrew, the digital toolkit is not nearly compelling enough as it exists today to turn otherwise recalcitrant cultures upside down and thereby prove your thesis.  Cultures that are already very sophisticated in their Social tendencies without the tools can benefit.  Others will not change, and if they would, there would be no end of case studies showing it.  The truth is that recalcitrant culture is corrosive to E2.0.  It kills it dead as Howlett suggests through passive aggression and politics, the way people have always killed things they were afraid of.  Why should a little bit of software upset the very structure on which people build their livelihoods, their reputations, and their power bases?  Andrew, go back and study all those writings about a Social Business that you’ve so eloquently quoted from, because those forces I mention are more than powerful enough to derail E2.0.So are we doomed?  Not at all.  As I mentioned, it is possible to create a UX that is an agent of change.  The trick is to design from the standpoint of not having to change the culture before it can be successful.  That is something that no E2.0 offering to date has yet done, though we have been trying since Ray Ozzie brought us Notes a very long time ago.  How would this new UX operate?  I have some ideas, but let me start with an example of a market where something similar worked with a vengeance. 

Long ago, but still in my recorded memory, there were no such things as spreadsheets.  We had accounting and accounting software, which produced reports.  We had various attempts at using computers large and small to do analysis, mostly by programming.  Very little analysis was actually getting done because despite the availability of simple languages like BASIC, and despite the cult following PC’s were gaining, you had to learn to be a programmer to do it, and that was too hard.  Then along came the spreadsheet.  What an interesting confluence of properies it had:

1. Spreadsheets have tricked more people into becoming progammers than anything else in history.

2. They did this largely by not forcing people to learn to be programmers.

3. Instead, they became an electronic embodiment of what was already being done.  A “spreadsheet” for those that don’t remember what it used to mean, was a particular kind of paper form that accountants would lay out in order to organize their numbers for computation.  They used to call them “electronic spreadsheets”, in fact.  I remember to this day driving over to an accountant’s home to see one for the first time so I could understand what it was people were so excited about.  And there it was, a piece of paper come to life and calculating live numbers as I changed the cells.

The spreadsheet is a metaphor for where E2.0 has to go if it is to regenerate itself, make a huge difference, and Cross the Chasm.  The UX has to start from how people are working today, not how you’d like them to work after they have accepted your E2.0 tool.  Proponents will say, “We’ve already done that!”  It’s true, but they’ve picked the wrong things to emulate and automate.  Wikis are automated the means to publish books or perhaps to keep community filing cabinets.  They’re great.  But who will argue that books or filing cabinets have a radical ROI?  Likewise with automating the water cooler.  If you look at it in that light, have you really solved the water cooler problem so much better that it has a huge ROI?  Was the water cooler ever capable of delivering a huge ROI?  Probably not.

I will leave this post on that note because there are so many business processes that have the huge potential for ROI that to drill down on any particular one would do the others a disservice.  E2.0 vendors, heed the spreadsheet.  Quit trying to automate the water cooler, quit trying to change the culture, and figure out something genuinely new to do besides copying Facebook!

Posted in enterprise software, Marketing, strategy, user interface, Web 2.0 | 11 Comments »

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