Web 2.0 has corporate America spinning

More flexible
And not just imagine — Dresdner Kleinwort Wasserstein, for instance, uses a Socialtext wiki instead of e-mail to create meeting agendas and post training videos for new hires. Six months after launching it, traffic on the 2,000-page wiki, used by a quarter of the bank's workforce, already has surpassed that of the company's intranet (see BW Online, 11/24/05, "E-Mail Is So Five Minutes Ago").

Corporations also are balking at installing big, multimillion dollar software programs that can take years to roll out — and then aren't flexible enough to adapt to new business needs. "They're clunky and awkward and don't encourage participation," grumbles Dion Hinchcliffe, chief technology officer of Washington, D.C. tech consultant Sphere of Influence.

That's why companies are warming to the idea of opening their information-technology systems to do-it-yourselfers. And they spy an intriguing way to do that with what are known as mash-ups, or combinations of simple Web 2.0 services with each other into a new service (see BW Online, 7/25/05, "Mix, Match, and Mutate").The big advantage: They can be done very quickly with existing Web services.

Business networks
IBM, for instance, last year helped the U.S. Chamber of Commerce Center for Corporate Citizenship mash together a one-stop shop for people displaced by Hurricane Katrina to find jobs. People type into one box the kind of job they're seeking, and the site searches more than 1,000 job boards, then shows their location on a Google Map. "This [mashups] could be a way to provide solutions to customers within hours instead of months," says IBM's Smith.

Companies are starting to take a page from MySpace, Facebook, and other social-networking services. The reason: As appealing as that social aspect is for teens and anyone else who wants to stay in closer touch with friends, it's even more useful in business. After all, businesses in one sense are social networks formed to make or sell something.

So it's no surprise that corporate-oriented social networks are gaining a toehold. LinkedIn, an online service for people to post career profiles and find prospective employees, is the recruiting tool of choice for a number of companies. "In 2003, people thought of us as a weird form of social networking," notes LinkedIn CEO Reid Hoffman. "Now, people are saying, 'Oh, I get it, it's a business tool.'" (see BW Online, 4/10/06, "How LinkedIn Broke Through").

Staying young
Despite all the activity so far, it's still early days for this phenomenon some techies (who can't help themselves) call Enterprise 2.0. For now, the key challenge for executives is learning about the vast array of Web 2.0 services. And that requires more than simply checking in with the premier Web 2.0 blog, TechCrunch (see BW Online, 6/2/06, "Tip Sheet: Harnessing Web 2.0").

Where to start? Watch what kids are doing. If they use e-mail at all, it's a distant fourth to instant messaging, personal blogs, and the social networking sites, because they're much easier to use for what matters to them: staying in touch with friends. Companies need to provide more compelling ways for this highly connected bunch as they move into the workforce, bringing their valuable contacts in tow. "Young people are not going to go to companies where they can't use these new tools," says Lane. "They'll say, 'Why would I want to work here?'"

It's also critical for executives to try out these services themselves: Create a MySpace page. Open a Flickr account and upload a few photos. Write a Wikipedia entry. Create a mashup at Ning.com. "The essence of Web 2.0 is experimentation, so they should try things out," says venture capitalist Peter Rip of Leapfrog Ventures, an investor in several Web 2.0 startups.

Free P.R.
Then there's blogging. It's worthwhile to spend considerable time reading some popular blogs, which you can find at Technorati.com, to get a feel for how online conversation works. Only then should execs try their hand at blogging — and perhaps first inside their companies before going public. Thick skin is a requirement, since the "blogosphere" can be brutal on anything that sounds like spin.

But the payoff can be substantial, if hard to quantify. Genial Microsoft blogger Robert Scoble, for instance, is credited by many Redmond watchers with doing more to improve the company's image than millions of dollars in public relations. In no small part that's because he has shown a willingness to criticize his company at times.

(MSNBC.com is a joint venture between Microsoft and NBC News.)

And companies should to provide open forums for their customers to express themselves. That can mean critical, even vicious comments. One Boeing (BA) exec who started a blog, for instance, was told early on: "Take down your blog. You embarrass us (see BW Online, 5/22/06, "Into The Wild Blog Yonder")."

New management
But the upside can be a brand to which people feel a stronger emotional tie. Says Forrester Research analyst Chris Charron: "In the end, the brand is owned not just by the people who create it, but by the people who use it."

All that's going to require more than slick technology. Executives, long used to ruling from the top of the corporate hierarchy, will have to learn a new skill: humility. "Companies that are extremely hierarchical have trouble adapting," says Tim O'Reilly, CEO of tech book publisher O'Reilly Media, which runs the annual Web 2.0 Conference "They'll be outperformed by companies that don't work that way." Ultimately, taking full advantage of Web 2.0 may require — get ready — Management 2.0.

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