Enterprise 2.0: a boon or bane for entrepreneurial and innovative expenditures? | Journal of Innovation and Entrepreneurship | Full Text

According to Mayfield ([2008]), ‘Social media is a genie that will not be disappearing back into its bottle’. Whether you like it or not, the enigmatic power of social media does not let you break away from it (Mukherjee [2014]). Having human interaction as its base, it is not a new concept (Edosomwan, Prakasan, Kouame, Watson and Seymour, [2011]), though the intermediation of advanced information technology platforms has led to metamorphosis of interpersonal interactions and communications globally (Edosomwan et al. [2011]; Duhan and Singh [2013]).

Incessant, continual, and unparalleled global expansion and intrusion of social media platforms in our day-to-day activities (Nielsen [2012]; Vehr [2012]; Stanley [2009]; Duhan et al. [2013]) are evidenced by the fact that as per an estimate of Wikipedia (http://en.wikipedia.org/List_of_social_networking_websites), more than 200 thriving social communities are available to netizens (Duhan et al. [2013]), out of which Facebook is a front-runner with membership exceeding 517 million across 212 countries (Internet World Stats [2013]). Though interestingly, despite being such a rage, there appears to be no agreement among researchers and scholars as to what encompasses social media, and terms like Web 2.0, social media, and user-generated content (UGC) are often interchangeably used (Constantinides and Fountain [2008]; Kaplan and Haenlein [2010]). Nevertheless, some researchers have attempted to distinguish the three terms (Kaplan et al. [2010]). As per Kaplan and Haenlein [2010]:

Web 2.0 is the ideological and technical foundation based on participatory and collaborative efforts facilitated by tools such as Adobe Flash, Really Simple Syndication (RSS), and Asynchronous Java Script (AJAX).

UGC is the sum total of publicly available media content which is the resultant of creative effort of end-users outside professional realms. And social media, acting as an intermediary between the two, facilitates the creation and exchange of user-generated content by utilizing the ideological and technological foundations of Web 2.0.

On the other hand, Constantinides and Fountain ([2008]), even while acknowledging the emphasis on technical and social dimensions of Web 2.0 and social media, respectively, have used terms the Web 2.0 and social media interchangeably. The term Web 2.0, taken as an umbrella term, has been defined by Constantinides and Fountain ([2008]) as ‘a collection of open-source, interactive and user controlled online applications expanding the experiences, knowledge and market power of the users as participants in business and social processes. Web 2.0 applications support the creation of informal users’ networks facilitating the flow of ideas and knowledge by allowing the efficient generation, dissemination, sharing and editing / refining of informational content.’ In accordance with Constantinides and Fountain ([2008]), for the present paper, researchers have used terms social media and Web 2.0 interchangeably.

However, the multiplicity of social media platforms coupled with their interactive nature, collective wisdom, content creation feature, and easy access (Chaffey et al. [2006]; Duhan et al. [2013]) has led marketers to embrace social media or Web 2.0. Marketers use social media platforms as advertising medium, direct-response medium, sales transaction platform, a lead generation medium, distribution channel, customer service platform, and relationship-building platform (Chaffey et al. [2006]). These platforms are being utilized for a variety of purposes such as to increment brand awareness, brand building, brand exposure, and brand reinforcement. In addition, these platforms are helping organizations in increasing traffic, in gaining marketplace intelligence, in developing loyal fans and in attracting more customers and employees to the organization. Customer service, customer support and productivity improvement are some other areas where these platforms are being taken help of (Mangold and Faulds [2009]; Edosomwan et al. [2011]; Stelzner [2013]; Jagongo and Kinyua [2013]). All of these activities of the organizations are leading to positive results like improved sales, increased exposure, more business partnerships, increased lead generation, reduced marketing and communication expenses, improved search rankings, increased traffic, better market insights and business intelligence, increased effectiveness of marketing, increased speed of access to knowledge, enhanced customer satisfaction, and increased brand reputation and loyal fan base (Buytendijk et al. [2008]; Almeida [2012]; Stelzner [2013]).

The very characteristics of the socio-digital platforms, viz connectivity, convergence, collaboration, and transparency, (Duhan et al. [2013]) have transformed the business environment and have helped businesses to increase their worthiness, cultivate strategic partnerships, and increase their contact with customers and suppliers (Jagongo et al. [2013]). The statement of the former director of the National Intelligence, USA, Mike McConnell (as cited in Booz, Allen and Hamilton [2010]) states that survival and effectiveness of the organization are dependent on the comprehension of the functioning of blogs and wikis. This statement once again emphasizes the importance of social media or Web 2.0 for the businesses. Collective information sharing and collaboration at both inter- and intra-organizational levels can lead to making an organization more powerful (Booz et al. [2010]). Accordingly, the induction of Web 2.0 technologies at the work place has given rise to a new business lexicon Enterprise 2.0 or E 2.0 as shown in Figure 1.

Relationship between Enterprise 2.0 and social web. Image adapted from Evans and McKee ([2010]).

McAfee ([2006]), hailed as the architect of the term Enterprise 2.0, defined and explained the concept with the help of search, links, authoring, tags, extensions, and signals (SLATES), an acronym used for the building blocks or components of E 2.0. The article talked about the ground rules and the role of managers for effectively contesting the accompanied challenges and taking advantage of the opportunities in implementation of E 2.0.

Matuszak ([2007]) cited the real-life usage of E 2.0 in knowledge sharing and management, problem solving, innovation, and collaboration along with the challenges encountered by the organizations while adopting these technologies.

The Economist Intelligence Unit ([2007]) surveyed 406 executives working in diverse industries including financial and professional services, life sciences, IT/telecoms, and media across the world and found that the main reasons for the adoption of Web 2.0 technologies include the desire to cut costs and increase revenue, growth, and profitability. Ten tips were propounded in the report to combat the challenges encountered by organizations and to ensure success.

Mazumder ([2008]) stressed the necessity of adopting the next paradigm of web computing in organizations and defined it as Enterprise 2.0 as it caters to the communicating, collaborating, contributing, and participating needs of various internal and external stakeholders. Mazumder ([2008]) sensing the paucity of ideas to combat with and guide the organizations to deal with attendant challenges resulting due to formative nature of Web 2.0 and immeasurable benefits of its adoption in organizations, put forward an iterative adoption model comprising of four stages (identify, analyze, plan, and implement) for successful adoption of the same.

Terming Enterprise 2.0 as a dynamic journey, an integrative business strategy that is imperative reality to be faced and adjusted to, Buytendijk et al. ([2008]) define E 2.0 as the creation of competitive advantage through interactive, collaborative business models, which lead to organizational effectiveness and drive profitability. Citing the demographic changes and business changes as the main drivers metamorphosing organizations, the paper discusses an Enterprise 2.0 platform offered by the Oracle.

Fuchs-kittowski et al. ([2009]) did a comparative analysis of ten quantitative studies conducted during 2007 to 2008 in Germany. The study reported the diffusion, benefits, barriers, and potential of Web 2.0 technologies in an organization.

Chui et al. ([2009]), after surveying a range of executives, who have adopted Web 2.0 tools for their internal operations, suggested that incorporation of Web 2.0 technologies may result in content generation (mass internal content generation, broadcast solution sourcing, external collaborative contribution), community building such as participatory marketing and decision-support by harnessing information markets. However, in order to realize the same, management must undertake cultural transformation, incorporate technologies in workflow, let users decide the uses, ensure right participation such as by targeting tech savvy and respected opinion leaders, and strike the right balance of freedom and control.

Lennon ([2009]), building upon the concept of Enterprise 2.0 as proposed by Andrew McAfee, discussed various features and tools of social software, which are being utilized or can be utilized by organizations to facilitate collaboration and contribution of external and internal stakeholders of the organizations. Researcher brought to the fore potential advantages (viz information access, instant notification, simplicity, and cost effectiveness) and pitfalls (viz security, lack of adoption by staff, and loss of productivity) associated with the implementation of E 2.0. Lennon ([2009]) attributes the slow espousal of Enterprise 2.0 to the dynamic and formative nature of Web 2.0 technologies and to the reluctance of managers to adopt tools and services propounded by relatively new and inexperienced software companies to run their organizations.

Hughes ([2010]) distinguished between ‘enterprise portals’, ‘consumer social media’, and ‘enterprise social networking’ (termed as application of social networking techniques and technologies to businesses and ‘consumerization of the enterprise’). Researcher asserted that despite some evils associated with the use of social networking, it has potential for delivering productivity benefits, in coexistence with the organizational portals, to the organizations due to its people-centric approach around the content.

Stobbe ([2010]) recognized the superiority of Web 2.0 over Web 1.0 in communication and knowledge management arena in conventional industries and termed the incorporation of Web 2.0 tools in these as the corporate reality. The attendant benefits of Web 2.0 tools in the area of communication, marketing, innovation, and collaboration establish their need and supremacy, but for successful implementation, cultural changes, clear targets, choice of appropriate Web 2.0 tools, and evaluation parameters need to be taken cared of.

Turban et al. ([2011]) developed a framework to deal with the issues related to the amalgamation of social networking in the work places. Based on the analysis of potential risks and opportunities of enterprise social networking, researchers proposed a six-step fit-viability model to guide organizations with the institutionalization of the enterprise social networking.

Schueler ([2011]) investigated the social and organizational uses and effects of E2.0 technologies.

Bughin and Chui ([2011]) evidenced the benefits bestowed upon the organizations by integrating social technologies with their workflows – external as well as internal. Terming such organizations as internally networked, externally networked, or fully networked enterprises, depending upon the extent of usage of social technologies in an organization, the research demonstrated measurable business benefits such as market share gains, operating profits, and market leadership accruing to the networked organizations across a range of regions, industries, and functional areas. Researchers stressed the need for creating fully networked enterprises by integrating the Web 2.0 technologies into employees’ day-to-day work activities as well as using these to collaborate with customers, business partners, and suppliers, via continuing adoption and by removing the organizational barriers resisting the change.

Almeida ([2012]) while stressing the need and importance of fast inclusion of web 2.0 systems in the organizations also highlighted the accompanied security threats such as losses in productivity, loss of company reputation, client confidence, vulnerabilities to data leaks, and inherent increased security risks. As blocking access to these new platforms is neither feasible nor sustainable, organizations must adopt a balanced and novel approach to deal with these attack vectors. Some of the solutions to deal with the problem could be the formulation, implementation, and compliance to Web 2.0 policy/IT policy along with the other IT initiatives such as highly customized browse settings, installation of anti-malware software, adoption of strong authentication mechanisms, and establishment of a data loss protection solution.

Leonardi et al. ([2013]) termed the use of social media in organizations as enterprise social media (ESM) and discussed the advantages and disadvantages associated with the incorporation of social media in organizations in specific context of communicative activities. As ESM operates as platform for social interaction and lends the visibility and persistence to communicative actions, more opportunities are accorded to the employees for social learning through instrumental knowledge and metaknowledge. Researchers critically analyzed the implications of ESM for four organizational processes, viz social capital formation, boundary work, attention allocation, and social analytics by assigning three metaphors, viz leaky pipe, echo chamber, and social lubricant to ESM. The paper attempted to bring to the fore the implications of introduction of social technologies for communicative activities inside the organization.

Booz et al. ([2010]) elaborating on the concept of E 2.0 and its importance propose a structured E 2.0 approach, comprising of two complimentary and integrated service offerings, for quick and successful implementation of E 2.0.

Kopaee and Uppal ([2011]) talked about the paradigm shifts effected by social media technologies in organizations. Authors, while stressing the importance of inclusion of these technologies, do not see the phenomenon as an opportunity in the foreseeable future rather mandate it to keep pace with the competitors. Paper enumerated the potential benefits of social media for various functional areas, antecedent on the very characteristics features of social media fostering collaboration, creativity, innovation, communication, and relationships, alongside attendant risks. A well thought strategic plan, comprising of four iterative steps, has been recommended for intelligent risk management in E 2.0.

Literature review evidences that it is extremely difficult to conjure up an accurate picture of the usage of Enterprise 2.0 due to the dynamic nature of the Web 2.0 coupled with the reluctance of the researchers to differentiate between internal and external usage of Web 2.0 tools. At best, what can be done is to have a cross-sectional view of the situation (Stobbe [2010]). In addition, most of the researches have been conducted in the field of computer-supported cooperative work (CSCW) and human computer-interaction (HCI) communities. The focus of these researches is on specific technologies and their usage by people in organizational settings. The implications for enterprise social media use for organizational actions for internal communication have largely been ignored, and scholars in management and organization studies have not yet begin to explore enterprise social media use (Leonardi et al. [2013]). In addition, the existing research is quite fragmented as most of the researchers have either catered to specific social media tools, particularly wikis and blogs, (Turban et al. [2011]) or have reported only a few of the opportunities/risks/solutions as applicable to the situation being analyzed. The solutions propounded also are quite varied and contextual in nature as substantiated by literature review. Hence, the present study has been proposed in order to have a comprehensive coverage of the advantages, challenges, and suggestions with reference to incorporation of Web 2.0 technologies in the organizations and thereby to fill the research gap.

The present paper is an attempt by the authors to explore the term ‘Enterprise 2.0’ and the associated advantages and challenges posed to the businesses with the adoption of Web 2.0 technologies in the organizations. An attempt has also been made to suggest some ways to reduce or remove some of the attendant challenges of Web 2.0 technologies, so that organizations can become more effective in their pursuit of innovative and entrepreneurial expenditures. Accordingly, researchers propose the following objectives:

To review the concept of Enterprise 2.0.

To identify the opportunities and challenges posed by induction of Web 2.0 technologies in organizations.

To suggest the ways for effective incorporation of Web 2.0 technologies in organizations in pursuit of innovative and organizational expenditures.

Originality/value

The paper offers an accessible review of the concept of Enterprise 2.0 along with its attendant value and challenges to the business organizations. The paper will definitely bring to the fore various core issues pertaining to the adoption of techno-social platforms available in the form of Web 2.0 or social media in business organizations. It will create the interest in academicians working in business management and information technology departments in universities and colleges and students studying in these disciplines as well as in the professionals working in diverse functional groups of the organizations.

Methodology

The paper is based on the secondary literature collected from diverse in-house and proprietary sources available at their websites. Alongside it, various relevant books, journal research papers, and other articles published by news agencies etc. have been taken help of. Information so gathered was suitably analyzed, validated, and adapted as per the requirements of the study.

The characteristics of social media, viz connectivity, convergence, collaboration, and transparency are responsible for the fast and global adoption by people and for the transformation of business environment. These developments have prompted the authors to analyze the attendant opportunities and challenges of these social-digital platforms in the metamorphosis of organizations into Enterprise 2.0 and to suggest the ways for effective implementation of Web 2.0 for innovative and entrepreneurial pursuits.

The paper has been organized around five sections. The first section provides a peep into development of the concept of Enterprise 2.0 to the readers. In the second and third sections, the opportunities and challenges posed by induction of Web 2.0 technologies in organizations has been elaborated. The fourth section encompasses the ways for effective incorporation of Web 2.0 technologies in organizations in their pursuit of innovative and organizational expenditures. The concluding remarks emphasizing the major findings regarding the incorporation of Web 2.0 technologies have been given in the final section of the paper.