by C.G. Lynch

Enterprise Web 2.0 Adoption Still Growing, McKinsey Report Says

Jul 30, 20083 mins
Collaboration SoftwareConsumer ElectronicsEnterprise Applications

The adoption of enterprise Web 2.0 technologies, often referred to as Enterprise 2.0, has grown since last year, an annual McKinsey report says. But barriers remain, including justifying a return on investment to executives who allocate the money for Web 2.0 tools.

A new McKinsey report found that many companies have adopted Web 2.0 technologies such as blogs, wikis, social networks and mashups during the past year, with companies on average adding three Web 2.0 tools to their companies technology offerings.


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But most companies remain on the fence about whether or not they’re happy with the new tools pervading their technology diets. Only 21 percent voiced overall satisfaction, according to the report, and 22 percent cited clear dissatisfaction.

The poll was conducted with 1,988 executives in June 2008 at enterprises located all around the world. The adoption by those companies of most Web 2.0 technologies has risen since the poll was conducted for the first time last year, according to the report.

For instance, blogs are being adopted by 34 percent of companies, compared to 21 percent in the previous year. Really Simple Syndication (RSS) — a technology that allows users to subscribe to information that’s relevant to them and have the data pushed to a RSS reader or their e-mail box — jumped from 24 percent to 33 percent. Wikis went from 24 to 32, while social networking held steady, only moving from 27 to 28 percent.

The statistics support analyst contentions that social networking adoption has been sluggish due to lagging interest from employees who fail to update their profiles with fresh information , making for a static and uninteresting user experience. Often, they prefer their consumer social networks, such as Facebook and MySpace, which as a result have often been banned by many corporate IT departments.

But the outlook for increased Web 2.0 adoption has begun to hit some barriers, the report contended. As the highest ranked issue, 28 percent of respondents said, “My company doesn’t understand the potential financial return from the use of Web 2.0 tools.”

That’s often because the return on investment can be difficult to show in hard numbers. ROI rests more in connecting people to collaborate on new ideas, a senior vice president at Wachovia told an audience at the Enterprise 2.0 conference in June. Among the reasons he cited were improving engagement with employees and attracting Gen Y workers to the workforce.

For 22 percent of executives, their corporate culture doesn’t encourage Web 2.0 usage. In addition, 20 percent said, “My company doesn’t provide sufficient incentives to adopt or experiment with Web 2.0 technologies.”

Web 2.0 adoption in the enterprise — often referred to as enterprise 2.0 — has been difficult because many employees feel the need to remain tethered to more traditional tools such as e-mail.

But some companies have been successful by implementing wikis in small groups and having departmental leaders champion their use to direct reports. A marketing company that spoke with CIO in June about its wiki implementation said that team leaders at his company would respond to e-mail inquiries with a link to a wiki, asking employees to read or edit it.

On the whole, one thing the report made clear was that these tools have been primarily adopted to tackle the problem of knowledge management, the process of storing and sharing information within organizations. A staggering 83 percent of respondents who had added Web 2.0 technologies for internal use said that they did it to “manage knowledge.” Close behind, 78 percent said they used Web 2.0 to “foster collaboration” and 74 percent to enhance company culture.