An Update on Web 2.0

Earlier this year, I examined the overexcitement about Web 2.0 technologies and the lack of time companies were putting into a Web 2.0 strategy that would help drive their business in the column, “Social Media and Web 2.0.”

Recently, a colleague forwarded me the McKinsey Quarterly report, “Building the Web 2.0 Enterprise.” Overall, the report was insightful, pointing out some common problems that companies encounter regarding Web 2.0.

In my opinion, companies focus too much on the individual technologies and not enough on the overall Web strategy of connecting a business, customers, and prospects. To build a successful enterprise Web 2.0, spend time to define what success means to you and how you want Web 2.0 technologies to change the ways you communicate with your customers, prospects, and partners.

The McKinsey report was based on its second annual survey of business uses of Web 2.0 technologies, including wikis, blogs, social networks, and mash-ups. The survey asked, “Which of these social and interactive tools their companies have adopted and for which purposes, what they are doing to encourage their adoption, and how satisfied they are with the use of these tools.”

You may have the same feeling that I do — these questions are too focused around the tools and not truly the strategy or use. You can come up easily with five great examples of companies using those technologies well to connect with their audience and five horrific ways companies are wasting their money using these technologies.

A few interesting things from the McKinsey report included:

  • More companies are adopting Web 2.0 technologies. Last year, companies surveyed said they had adopted an average of just over two Web 2.0 tools. This year, that number increased to 2.5 tools, on average. Now that the technologies have been around for a while, this increase is not surprising. What’s surprising is the next point. Read on.
  • The honeymoon is over for some. Companies revealed they are having trouble realizing some of the benefits — and I would add ROI (define) of some investments. At either end of the spectrum, the consulting firm found only 21 percent are satisfied overall with Web 2.0 tools and 22 percent voiced clear dissatisfaction. Some dissatisfied companies have abandoned certain Web 2.0 technologies, according to McKinsey. None of this is surprising as we have all seen companies dive into these technologies (and others over time) without really considering if it makes sense or how it will be used.
  • Identifying obstacles. The report analyzed barriers for success of Web 2.0 initiatives. It also compared those results based on those with high and low satisfaction. The top three aggregate “barriers” (or excuses) for lack of success for the respondent with the lowest satisfaction were as follows:
    • “My company’s leadership team doesn’t encourage the use of Web 2.0 technologies.”
    • “My company’s culture doesn’t encourage the use of Web 2.0 technologies.”
    • “My company doesn’t understand the potential financial return from the use of Web 2.0 tools, techniques.”

    I’d like to think the first two are based on smart executives and leadership who aren’t willing to throw money at something if it is not strategic or well planned out. In many cases the technologies might not make sense for the applications that technology is being used for. Think of it as using technology to solve a problem that either isn’t important or doesn’t exist at all! The third most common answer is a solid answer about understanding the impact. Hopefully this is tied to ROI of the investment — there could be differing opinions of the value or potential impact. Unfortunately in most cases companies don’t go through the analysis of the actual potential impact – they don’t understand how to quantify it so they don’t even try.

  • Approaches to adopting Web 2.0 tools. The most popular answer from the companies with the lowest satisfaction stated they adopt Web 2.0 tools when “the IT department finds and tests new technologies and then brings them to the business units.” This turned up considerably higher than any of the other responses. Coming back to a solution looking for a problem to solve — this happens all the time in corporate America. In some cases this can work. But often to be successful, the business side of an organization must identify the problem and come up with a solution and then have IT research and review technologies.

In closing, make sure you aren’t just reviewing the coolest, newest technologies that everyone thinks every company must have. Instead, take the time to determine the strategy and forecast out the way these new offerings will impact your audiences’ behaviors, attitudes, perceptions, brand loyalty, etc. Think more strategic. Think about the impact, and not finding a use for a new technology.

On a side note, I have been seeing more references to Web 3.0, which Wikipedia describes as an “emphasize machine-facilitated understanding of information in order to provide a more productive and intuitive user experience.” I would like to be the first to define “Web 3.528” as Fortune 500 companies (and all others) that define the goals for their site, talk to their customers, understand the impact of changes to their site, and constantly test on their sites without blindly investing in the newest technologies without considering its use for their specific business. Long live Web 3.528.

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