Web 2.0 and Social Networking for Business: Take the Plunge

Executives who want to understand the value of social networking or other web 2.0 technologies should just get out there and try it.

More and more companies are offering some type of web 2.0 or consumer technology as corporate applications to their employees. In fact, two-thirds of respondents to a CIO Research study earlier this year said they do so, with IM, wikis and blogs leading the way.

According to Forrester Research, Web 2.0 technology spending will grow to $4.6 billion in the next five years. That would put it into a category almost as large as business intelligence, one of the hottest software growth areas of the last few years.

While today the vast majority of Web 2.0 applications are internal, Forrester expects spending on external applications to dwarf that soon. Blogs, wikis and social networking tools that are now being used for internal communication, collaboration and knowledge management will increasingly be used to communicate and collaborate with customers and partners. Consumer goods companies such as Pepperidge Farms and Mattel, Jockey and Pepsi have already built feature-rich online community sites where customers can play games, enter contests, download music, interact with other people like them, and even contribute new product design ideas. It’s fascinating to see the different approaches they’re taking.

As with all new things, there’s a wide range of acceptance (or lack thereof) and adoption of Web 2.0 across organizations. Many CIOs wrestle with how to communicate to other senior executives why this isn’t a frivolous waste of time but actually something worth spending money and attention on. Some still need to figure that out for themselves.

But getting buy-in to the value proposition is just the start. Web 2.0 requires a completely different approach to management — a shift from command and control to facilitate and enable. Yes, you’ve heard that before, but this is the real deal. Even if you don’t buy-in, this is going to happen, and you can’t stop it. This is the first time that a wave of new technology is being driven not by the technology organization or even vendors but by employees and customers. That changes the game.

My advice to all executives today is just get in there. Set up accounts at Facebook, LinkedIn, Flickr, Dopplr and Twitter. You can’t begin to understand the real value (and therefore what the right approach is for your company and your customers) until you experience it for yourself.

I recently gave a presentation on this to the Boston Chapter of the Society for Information Management. You can view it here.