As the Enterprise 2.0 conference kicked off in the heart of Silicon Valley in early November, any of the 1,600 attendees checking their Twitter feeds may have been in for a shock. According to some of the tweets posted that morning, enterprise 2.0 is dead.

The word was that enterprise 2.0, a broad term used to describe the use of social technology in business, had reached the end of its useful life. The death knell precipitated a barrage of arguments and counter-arguments that, unsurprisingly given the subject matter, took the form of tweets and blog posts.

It is tempting, and not altogether inaccurate, to dismiss the episode as yet another arcane debate over terminology, the kind that the IT industry periodically wraps itself around as practitioners in the real world get on with doing their jobs.

But it does have some significance. The fact that the knives are out for the term ‘enterprise 2.0’ suggests that there is some antipathy towards the idea, or at least its failure to yet produce the anticipated results. Why this is, and whether the idea needs to be rethought, are two important questions for the future of business software.

A question of meaning

Originally, the term enterprise 2.0 was conceived as a business response to Web 2.0. The evolution of blogs, wikis and RSS feeds had transformed the web from a passive to an active experience. This was changing how people interacted with one another, so it stood to reason that businesses would be affected in one way or another.

More recently, the term has come to refer more explicitly to the use of social technology in a business context. Andrew McAfee, the Harvard Business School professor that coined the term, now defines it as “the use of emergent social software platforms within companies, or between companies and their partners or customers”.

This definition covers two distinct kinds of interaction – internal and external. Importantly, that means enterprise 2.0 is a concern for two departments of the enterprise: marketing and IT.

This division is one of the bugbears of enterprise 2.0 naysayers. In a provocative post entitled ‘Enterprise 2.0 is beyond a crock. It’s dead’, blogger Dennis Howlett observed that, “On the one hand you have people who think [enterprise 2.0] is about collaboration, while others portray the topic as an extension to sales and marketing. It could be both, but very often you will see [definitions] co-mingled as though they are one and the same.”

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Examples of companies using social media as a marketing tool abound. Harley Davidson is one of the classic case studies: its employees use social networking site Facebook to build and maintain a community around its brand. Today, the marketing departments of most consumer brands employ people and tools to monitor social networking sites.

Not everyone thinks this ‘counts’ as enterprise 2.0, however. Oliver Marks, founding partner of analyst firm Sovos Group argues that what sets enterprise 2.0 apart, what makes it uniquely transformative, is its approach to data – making sure that information and knowledge held within the enterprise is accessible to everyone. And that, he says, makes it an IT issue.

Examples of internal ‘enterprise 2.0’ users include industrial giant Dow Chemical. The company has created an internal social network that allows its managers to find out where employees with certain skills are located. It has since broadened this to include staff no longer with the firm, such as retirees.

Put in this light, enterprise 2.0 may feel to seasoned IT professionals like a new word for the collaboration and knowledge management projects they have wrestled with over the past decade or more.

And indeed, for the business executives who are likely to give such projects the go-ahead, the distinction between those tools and whatever ‘enterprise 2.0’ might be is not important, argues Angela Ashenden, principal analyst with industry watcher MWD Advisors. What matters is whether they serve a genuine purpose.

“Where you see these types of tools in the enterprise, it’s because someone has a real business problem to solve,” she explains. “They’re not really interested in the technology, but what it can do to help them.”

Enterprise 2.0 sceptics such as Martijn Linssen, founder of collaboration consultancy wewirepeople, take this argument even further. They say that, far from being a watershed moment for IT, the emergence of enterprise 2.0 is just the latest chapter in a long-standing trend, which can more accurately be described as “social business”.

The mistake enterprise 2.0 zealots make, Linssen claims, is to assume that technology and tools are “at the heart of solving our issues”. In other words, the current crop of social business tools does not represent anything new.

This point is debatable. MWD’s Ashenden points out that, unlike the collaboration tools of old, social business tools are designed to emulate technologies that are now being used by employees in their personal lives. That should, in theory at least, make them easier for users to adopt, she says, thereby overcoming one of the traditional problems with collaborative tools.

Hearing the chatter

One company that may have been surprised to hear of enterprise 2.0’s death is Salesforce.com. Earlier this year, the software-as-a-service supplier introduced Chatter, a business tool that mimics many of the functions of Facebook. Salesforce.com says that more than 60,000 companies are now using it, and that it is its fastest-selling product to date.

Scancom, a UK-based supplier of mobile devices to businesses, is one of those 60,000 companies. According to managing director Chen Kotecha, the introduction of Chatter has helped Scancom to improve the effectiveness of its customer service teams.

One obvious impact of Chatter has been a drop in the use of email internally. “It may sound strange, given that we sell a lot of BlackBerrys, where the main selling point is email, but it showed me that we can actually use our communication tools more effectively,” says Kotecha.

Chatter allows staff to communicate in a way that email cannot, he says, because everyone is frequently updating their status, much as they might for their Facebook profile.

In turn, that means that when one member has flagged up that they are dealing with a customer on a specific problem, others can see the details and anyone who knows how to resolve it can chip in immediately. “Email has its place, but Chatter has definitely made us more efficient in the way we work,” he adds.

The example of Chatter encapsulates two characteristics that arguably distinguish enterprise 2.0 tools from their predecessors. The first is the familiarity to users, thanks to its resemblance to consumer tools; the second is the way that it allows employees to access information in real time.  

Sovos Group’s Marks argues that, in terms of the core idea, enterprise 2.0 tools are not all that far removed from putting a suggestion box in the office. What differentiates them is the speed at which submissions can be acted upon. “Even tools like wikis start looking ponderous,” he adds.

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If the benefits of enterprise 2.0 tools are real, why is the concept under attack? And why is adoption not more prevalent?

Some of the issues holding enterprise 2.0 back are familiar IT implementation issues. For example, Marks argues that one problem may be that the tools are being deployed tactically by different parts of the business.

Project teams faced with looming deadlines may readily appreciate the power of improved collaboration, but when they choose software from Socialtext, another team chooses tools based on Microsoft’s SharePoint and yet another chooses software from Jive, the end result is dozens of departments “creating a patchwork quilt of collaboration silos”, says Marks.

And while any of the individual tools may be powerful in their own right, the technical challenges in trying to create a collaboration platform that scales across the enterprise may be insurmountable, he adds.

Even if the IT chief can herd various departmental heads into creating a coherent framework for enterprise-wide social business, they will likely run into the age-old challenge of budgetary approval.

Once you start looking at any IT project that will cover the entire enterprise, you can expect to have to answer questions about return on investment (ROI), says Adrian Simpson, SAP’s head of business intelligence and platform. “If you’re going to need infrastructure to support the deployment, you’re going to need to show a business case,” he says.

Simpson argues that this makes on-demand tools more appealing, as the ability to pay for tools out of the operating budget means that they are a lower-risk option for CIOs.

MWD’s Ashenden, however, argues that to focus on ROI – a measure of the financial contribution of a given tool – is to assume that the key to successful social business project lies with the technology.

The reality, she says, is that the barriers that prevent staff from working cooperatively or discourage employees from sharing their ideas cannot be overcome just by providing workers with a Facebook-like tool.

For workers to share their best ideas and to collaborate there has to be an organisational culture that supports that type of working, says Ashenden. Performance appraisal and reward systems have to reflect that this behaviour is valued for people to feel that their efforts are recognised. “For companies that have that type of culture, the ROI question is redundant,” she adds.

Two important points have been clarified as a result of the recent spat over enterprise 2.0 and its supposed death.

One is that although there is, of course, nothing new about the need to collaborate and share knowledge within a business, recent social technologies have the characteristics of familiarity to users and real-time information sharing that represent a step forward from traditional ‘groupware’ systems.

The second is that enterprise 2.0 projects, designed as they are to affect the cultural fabric of an organisation, cannot be conducted in the same way as a traditional IT implementation with an explicit and finite function.

It is arguably this, rather than any lack of utility, that means it will be some time before organisation-wide enterprise 2.0 roll-outs become the norm. And by then, the terminology will doubtless have moved on.