Wednesday, 12 September 2012

Stop Thinking $$$ For One Second: The True Value of Enterprise 2.0

Organisations have recognised the value of Web 2.0 technologies and have made huge investments introducing these technologies into their business. This recognition is sparked by a number of factors, including the growing importance of digital channels, the recognition of accountability that Web 2.0 technologies can bring to the enterprise, and the strategic benefits of amassing collaborative intelligence.  But how do we measure the benefits of enterprise 2.0 software to calculate our ROI, especially when dealing with intangible outcomes such as increased innovation or greater knowledge retention? Perhaps considering a return on change (ROC) towards Enterprise 2.0 culture would be more effective than pure monetary measurements. 

Enterprise-class organisations recognize the value of their Web 2.0 programs on multiple levels within their organisations. Whether playing a direct or an indirect role in revenue generation, large organisations that spend hundreds of thousands of dollars on Web 2.0 technologies must clearly recognise the benefits. If not, organisations must reevaluate their implementation. Evans (2010), has identified three key areas to assist in measuring the intangible values of Enterprise 2.0 technologies. 

Employee Engagement: Employees using enterprise social software platforms in the workplace are more engaged than similar employees who do not use these tools. Employees are more engaged because they become part of something larger than themselves and their immediate departments. Knowledge and work become more transparent and employees are able to get real-time feedback, visibility, and gratification.

Staff Turnover: Employees using activity streams in the workplace are less likely to turn over than those that do not use activity streams. In addition to increasing employee engagement, enterprise social software platforms help employees onboard more quickly, help them find the information they need to be successful, and help them receive real time feedback from fellow coworkers – all of which lead to better employee retention.

Sales: Enterprise social software platforms provide employees with real time business insights, allowing them to react faster to product availability, customer issues, news about the competition, and other insights that help them go first to market with new products.These 3 areas are all easily measurable through analytical tools and acquired data. By obtaining data concerning the employee usage of your enterprise 2.0 community combined with other specific considerations per segment (for example in turnover other factors such as salary and promotional opportunities will be weighted), it is possible to gain insight into the ROI of the Web 2.0 programs. 

These 3 areas are all easily measurable through analytical tools and acquired data. By obtaining data concerning the employee usage of your enterprise 2.0 community combined with other specific considerations per segment (for example in turnover other factors such as salary and promotional opportunities will be weighted), it is possible to gain insight into the ROI of the Web 2.0 programs. it is important to remember that collaboration isn’t just the knowledge and information that employees input into the network, but also the information that employees gain from the network to take back to their jobs. Other benefits include breaking down knowledge silos, reducing the time spent in meetings, and increasing overall productivity.

Although harder to measure than the average conversion rate, or views your page company's page receives, the value of Enterprise 2.0 is undeniable. Leading organisations use Enterprise 2.0 to achieve greater collaboration and an increase in overall productivity. Companies that apply Web 2.0 tools in this manner obliterate guesswork marketing and develop online programs with the evidence of past performance, projected outcomes, and clear expectations of returns. 


  1. Hey Justin, I like your post. Employee engagement, staff turnover and sales are three big facets in any organisation regardless of E2 application.

    However, I think the first two points (employee engagement and staff turnover) are more important than sales. I say this because, I am sure there are some organisations with mission statements that focus towards ideas more than sales; non profit organisations for example.

    I would imagine people who work for non-profit organisations are doing so to pursue their own agendas. Therefore, non-profit organisations would naturally want to keep their staff engaged as a means of maintaining the passion and engagement of their workers. So I guess the ROI for non-profits would be more tricky to measure, as they are not depending on money, no? What do you think? Do you think it would be easier or more difficult for non-profits to measure ROI for E2?

    1. Hey Ollie, thanks for reading. I agree with you that non-profits would have a slightly different focus than your standard business. But sales (or donations) are still an important part of their business. An effective engagement strategy that targets potential donators is vital to the success of the organisation; if they're not getting funded than they cannot acheive their main goals. With this in mind, i believe it would be possible to measure the effectiveness of e2 application and ROI through donations by using the same tools as a regular business, providing valuable insight into where the funding they recieve is most effective.

  2. Hi Justin,

    if i may add to an interesting discussion that Ollie pointed out about whether ROIs maybe abit tricky..and this is from my own opinion that regardless of what kind of organisation it is, ROI is a tricky concept for both kinds of organisations. Having said this i think some NGOs are doing really well in terms of implementing various facets of E2 applications because of people who are generous and committed to what they do. For example, in one of my previous blog post i talked about an NGO call Ushahidi who has people who are very dedicated in rolling out the Ushahidi platform that facilitates one facet of social media such as 'crowdsourcing'. One of the features of Ushahidi is Google Analytics which helps captures the trend to help them measure their ROI.

    I also think NGOs need to be made aware that they can make great returns from using Free software but more so, what is the cost of not implementing E2 vs. implementing E2.

    That's just my thought. What do others think?


    1. Hey Thadreina,
      Thanks for reading! I jumped over and had a read of your post and i think you nailed it in regards to the cost of not implementing E2.
      Every business should be selecting what they believe are the most appropriate tools for improving engagement as well as constantly measuring the stats through tools like google analytics. There is no point in just implementing a strategy in a set and forget mentality as you will never know if it is worth your time and effort and cash.

      As you mentioned, there is plenty of free software out there to do this. Making business's aware that they can get results without spending bucketloads should be a main goal of any e2 strategist.

  3. Hi Justin.

    Great post. I agree with Ollie's comment above that increased employee engagement and reduced staff turnover are two of the more valuable intangible returns that can be gained from implementing Enterprise 2.0. I think that employee engagement is so important when it comes to productivity of staff. When staff feel that they are part of something bigger, they are going to be more inclined to work harder because they feel like they are making an important contribution. It's like right now really, we are all part of an online organisation (INN346) and our job is to write relevant reports each week. Each time we put up a post, other people can easily access it and leave positive feedback. This feedback makes us feel good about our work and we feel like we are part of a team. Therefor, we are more likely to put in extra effort for the next report to keep up the good rapport we have built with our fellow staff members (students). It would be entirely different if we just wrote a report on paper each week and handed it in to the unit co-ordinator. Our level of motivation would be based solely on our own drive to pass and obtain whatever grade we wanted to achieve.

    Also, the point you make about staff turnover being less in organisations that use activity streams than those that don't is interesting. I wonder if there is a link between that and employee engagement? You'd have to think so wouldn't you? There'd have to be some links between staff being actively engaged into their jobs and wanting to stick around as apposed to those who are not actively engaged and choose to seek employment elsewhere. Just a random thought. Do you agree?

    Anyway, I really enjoyed your post and I look forward to reading your work next week.



    1. Hi Candice,
      that's a good point. The format of this course solely relies on a form of polylogical communication (see previous post for more info on this doesn't exist in a tradtional unit format that uses a top-down method of communication.
      The reason we are compelled to engage with one another is not only grades but for me, there is an opportunity to extend my learning through your classmates (as well as not being a jerk by not replying to people's comments :P). this unit format also made picking a group quite easy as we already had pre-existing relationships with regular readers.

      This suggests that in a corporate environment, engagement would be key to building a community within the workplace so people are happier, stay employed longer and are more commited to their work therefore increasing productivity. i think that pretty much covers your last point, i've gotta make sure i read the whole comment before typing! point is, yes i believe they are linked :-) thanks for reading!