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Friday, November 6, 2009

The Real Enterprise 2.0

10:17:00 AM Posted by Oscar Berg , , No comments
Nenshad Bardoliwalla, former CTO for Enterprise Performance Management (EPM) and Governance, Risk, and Compliance (GRC) at SAP, has written an excellent article that provides "the missing components of the full Enterprise 2.0 picture". It is a must read, both for those who don't see how Enterprise 2.0 fits into their business and for all those Enterprise 2.0 evangelists that seem to think that a new major version does not build upon all previous versions, whether it is a software or an enterprise. Here is a teaser, but you must read the full article since it describes where Enterprise 2.0 fits in the Enterprise:
These definitions of Enterprise 2.0 and their juxtaposition against the definitions of Enterprise 1.0 are misguided. I am certain based on my experience that the free form emergent world depicted as Enterprise 2.0 is NOT an evolution from the structured world of Enterprise 1.0, but rather, the two will exist in an intertwined tapestry that defines the full breadth of what today's enterprises need to look like. It's extremely unhealthy for our industry to pit these two worlds against each other because they will perpetually co-exist."



If an Enterprise 2.0 tool can: increase the average deal size, reduce cost to serve, increase customer loyalty, decrease new product development time, etc., than there is a legitimate business use case and a hard ROI associated with it. So my advice to both the zealots and naysayers of Enterprise 2.0 would be to take an existing, legitimate pain point, like offer creation, or product development, or customer service, and start by benchmarking your current metrics. If an Enterprise 2.0 tool can move those metrics in the right direction in a provable way, you will have real, hard ROI. If the tool doesn't contribute to moving those process metrics in the way you hoped, then you might have a problem with your executive sponsor.
My comment to the last part about ROI, as I argued in my previous post, is that most organizations are missing "current metrics" when it comes to "knowledge work" that surrounds, enables and supports existing business processes in, say, the R&D and Marketing & Sales departments. They either don't have enough metrics, or the right ones to tell them how they actually perform. This means that there is no baseline to start from and from which to build your business case and calculate ROI. The challenge here is that we need to establish this baseline before we can prove that we can improve it. To be able to do this, we also need develop new or refined approaches, methods and metrics that allow us to establish this baseline because the ones that we have used when measuring performance in transactional business processes can't easily be applied to knowledge work.

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