Will Enterprise 2.0 ever enter big organizations?

I have been reflecting lately on how Enterprise 2.0’s experimentations could be introduced in a big organization environment. There is a lot of “change management” thinking there for sure: start small, pick quick wins, build a community of supporters,… But it seems that there is also more profound forces involved as well: Enterprise 2.0 represents a real paradigm shift for process oriented organizations.

I hate to use the term “paradigm shift”, because it has been used so many times, and for quite common situations. But in this case, I’m starting to wonder if there is not indeed a very distinctive approach between the two modes that would require organization to adopt very different ways to think about their internal dynamics.

Let me first give a bit more background on what I mean by process oriented. It is obvious that many big organizations, if not all of them, conceive their production of value (be it an actual product or a service) as a succession of tasks performed by different individual in specific roles. In this approach, the actual individual fulfilling a role is quite irrelevant as long as he or she has the capacity to perform the corresponding operations. The greatness of such a design is that it tends to make production fairly predictable. The downside is that you can not use the complete value of every individual in your organization because you ask them first to fulfill roles and you miss everything they can do outside of this specific role. Plus there is also a natural tendency to accumulate slack: if you use 100% of the time of an individual in a particular role, you create a bigger uncertainty than if you ask him to operate at 70%, plus or minus a couple of percents; and thus, you become less predictable.

On the contrary, if you loosely define Enterprise 2.0 as the adoption in a production context of collaboration modes as found on the Web, you end up with a very different picture. The individuals and their abilities are at the center of this picture. People freely decide to which project they will contribute and on which part. The whole dynamic is anything but predictable. It is on the contrary very efficient to perform many projects at the same time but with no coordination of a central authority that would ex ante define which one are really worth pursuing. Projects happen not because they are dimmed important by a couple of executive roles, but because the necessary skills aggregate through the desire of each participant of contributing. You trade predictibility for an incredible speed of implementation.

Now imagine a big organization that has been defining and refining its internal processes for the past decades. That has established its recruitment and dismissal processes to constantly have a sufficient stock of resources to fill the different roles. Imagine that you ask it to conceive itself as an internal market where resources can freely recombine to pursue emerging projects. That you promote the notion that you will, through this, greatly augment the output by loosing control on the nature of this output. Did I mention the term “paradigm shift”?

11 Responses to “Will Enterprise 2.0 ever enter big organizations?”

  1. 1 lehawes December 12, 2008 at 6:34 pm

    Frederic: This is such an amazing post. I really don’t think I could say it better myself, so I intend to trackback here from my blog. Well done!

    I would comment that very few large organizations are capable of making the paradigm shift you correctly state is required to fulfill the promise of Enterprise 2.0. Instead, look for disruptive innovators to lead the way to what I call the Work 2.0 model.

    Keep up the great thinking and writing!

  2. 2 Frederic Baud December 12, 2008 at 11:00 pm

    @lehawes Thanks for the encouragement. That will help providing more attention to my uneven blogging activity.

  3. 3 tjtobin December 13, 2008 at 1:01 am

    This is a really interesting idea.
    If you want an internal market, you have to have a float of unused resources being paid waiting to reform themselves for a new project – to most organizations having anybody knowingly unoccupied is an anathema. In Web 2.0 there are people ready to take them out of what they are doing for a while to think about and form what’s next. What would be the equivalent in an enterprise, where companies like to gel people into place in a given role, and not have them come out of it unless they are “reorged” from the top?

  4. 4 Frederic Baud December 13, 2008 at 10:05 am

    @TomTobin I think the paradigm shift is precisely that the organization will have to let people allocate their time. In a process oriented approach, employees try gaming their managers by providing biased man day estimates to tip decisions toward what they would rather do. The good aspect of this is that even chores get down if they are dimmed necessary by the top. But this add even more slack to the structure.

    In an Enterprise 2.0 approach, I think more and more employees will act as freelances on permanent contracts. Actually – and this may be the subject of another post – depending on the appearance of flexible contract and rewarding mechanisms (my pet subjects of p2pventure and p2pmoney), those freelances can end-up working on a permanent or semi-permanent relationship with a formal organization or on an entirely ad-hoc relationship outside of any formal organizations.

  5. 5 apurva December 15, 2008 at 3:33 pm

    Great post Fredric! I really like the way you take a ‘bird’s eye view’ comparison of the two models.

    It is a pretty scary picture when you compare how different the process driven model of functioning is from the emerging Enterprise 2.0 approach. In my experience of selling enterprise 2.0 software ( http://cyn.in ) to medium and large enterprises, I have learned that it’s disastrous to compare or attempt to replace one with another. Like you have rightly put, a lot has gone into building the process driven architecture for companies, and most would consider their processes to be one of the top defining values of the company itself.

    Enterprise 2.0 needs to augment these existing processes and add value. E 2.0 tools / approaches need to enable that extra productivity by taping into the 30% effort that’s been lying dormant until now. Though Enterprise 2.0 can and should be applied company wide, we should not attempt to replace processes across functions. Instead we should focus in increasing free form ‘Knowledge working’ over and above the processes and across as many functions as possible. That’s the only way we can expect adoption from large companies.

    Although the models are distinct, they can well co-exist. However, Enterprise 2.0 needs to understand, adapt to and non destructively augment existing enterprise processes.

  6. 6 tjtobin January 1, 2009 at 12:39 am

    So in a traditional world, somebody (high up) gets an idea, then this is passed down until somebody has to execute. If this is a small piece of work, one person may be able to do it alone, but normally, you’d need a team. This means a person (another manager) would have to gather a team – probably using an existing team which was controlled by them – and execute on the idea.
    This is great for the people on the team – whether or not the idea is delivered at all, or in a timely manner, or whether it was what was wanted, they still get paid. All risk is borne by the company paying them all.

    So, in the E2.0 world, who gets paid and when? And who takes the risk? Without a system to manage competence and trustworthiness, wouldn’t it end up with more lawyers than workers?

    Is one of the first things in E2.0 a linked-in with digg on it? So you can say somebody is good or useless and for what?

    • 7 Frederic Baud January 1, 2009 at 1:15 pm

      If we speak of E 2.0 and the freelances on a permanent contract, people get paid every month for the priority they provide to the organization and the organization gets the money for their work in this context. This does not really change from the command and control contracting, the decision process is the only difference.

      When we speak of Market 2.0, this is where we have been thinking about P2PMoney: a way to flexibly pool resources and share revenue. In that case a P2PMoney platform keeps track of the contributions and the rights for potential upcoming revenue for every participant.

      Concerning the ‘trust metrics” within an organization, I’m not sure that it needs to be captured in an electronic system before other things can work. We already informally apply this within our work context by maintining personal ratings and being part of a formal organization removes the “hold-up” risks that can exist in the market.

  1. 1 The Zen of Enterprise 2.0 « Together, We Can! Trackback on December 12, 2008 at 7:20 pm
  2. 2 The millennial organisation « Enlightened tradition Trackback on December 18, 2008 at 12:39 am
  3. 3 Business will be different in 5 years - fundamentally different « Think Much - by Penny Edwards Trackback on January 9, 2009 at 10:26 am
  4. 4 System to organize what employees have to do, or want to do? « Frederic Baud Trackback on May 5, 2009 at 10:33 am

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