Tuesday, August 28, 2007

A View from the Top on Web 2.0

A View from the Top on Web 2.0

The recent publications of surveys on Web 2.0 usage by McKinsey, The
Economist or Forrester Research present interesting information on how
managers and CIO see the new technologies that have conquered the Web these
recent years. Let us look at their content before trying to analyse what
they could mean.

The McKinsey Quarterly

In January of this year, The McKinsey Quarterly conducted a survey on the
usage of Web 2.0 techniques with 2847 participants worldwide. Web 2.0 is
defined as a collection of technologies: Web services, collective
intelligence, peer-to-peer networking, social networking, RSS, podcast,
wiki, blog and mash-up. The most used technology was Web services (80%),
followed by collective intelligence and peer-to-peer networking with a
percentage close to 50%. Those three technologies were also the one the
most cited when participants were asked to identify the three technologies
the most important for their business. Few participants say that their
companies are using more than two Web 2.0 technologies.

As far as satisfaction is concerned, 16% of the participants said that they
were very satisfied of the financial return on their investment in Web 2.0
technologies over the past 5 years and 35% were somewhat satisfied. Only 6%
were dissatisfied. For most of the respondents, the Web 2.0 tools were
mainly used to manage collaboration internally (75%), then to interface
with customers (70%). Interface with suppliers and partners concerns only
51% of the participants. In the discussions with participants included at
the end of the paper, blogs and RSS are the most mentioned tools to
communicate with customers.

The Economist Intelligence Unit

The report "Serious Business: Web 2.0 Goes Corporate" was produced by the
Economist Intelligence Unit (EIU). The survey asked 406 senior executives
for their views on Web 2.0. The vast majority of respondents (79%) said
they saw potential of blogs and social networks to improve revenues and
reduce costs. In spite of this desire to cash in, many businesses cited a
lack of understanding of the technology as a barrier to using it. Over a
quarter of respondents said their IT departments lacked the competence
level to implement Web 2.0 applications effectively. While there may be
barriers to embracing Web 2.0, the study found that businesses expect it to
play a key role in how they communicate, both internally and externally.
The report found that 68% of executives considered it to be the single
biggest factor changing the way their company interacts with customers
while 49% said it would be the biggest factor affecting how employees
interact with each other and the business.

Forrester Research

A majority of IT buyers see Web 2.0 in a positive light, but CIOs would
prefer to buy the emerging technologies from larger incumbent vendors. That
is the situation according to a recent survey by Forrester Research of 275
IT buyers in June on Web 2.0 technologies. About 16% said they are hearing
about Web 2.0 from vendors all the time, and 50% said vendors pitch Web 2.0
technologies to them from time to time. Close to all respondents, 97%, said
they were familiar with Web 2.0, which is defined as a category of
technologies that includes wiki, blog, RSS, podcast, content tagging and
social-networking tools. Forrester says as the market grows it will
consolidate, which could please enterprise CIOs. Earlier this year, the
poll of about 120 enterprise CIOs on the Web 2.0 market found consolidation
is ideal for their plans with the technologies.

"Overall, 61% of respondents indicated that they would prefer both a suite
solution and a large incumbent vendor," Forrester concluded. "The deck
appears to be stacked against small pure-play vendors. Integration issues,
longevity concerns and the occasional lack of polish send CIOs looking for
other options." Survey respondents also want the technologies integrated
into their back-end systems, which leads them to want to see Web 2.0 suites
from incumbent vendors. Forrester found that 93% of the CIOs survey using
six Web 2.0 technologies would rather get the products from such vendors as
Microsoft, IBM or Oracle than from smaller, pure-play vendors, such as
Socialtext, NewsGator or MindTouch.

So what?

Many managers and CIO have a distant view from the Web 2.0 technologies.
Some adopted these tools just because it is "cool" or their manager has
read in the last edition of "Business Week" that they should do it. These
organisations tend to see Web 2.0 as a technological issue, but the real
challenge is to provide valuable content and modify interaction with users.
Installing a blog or an RSS feed is not really difficult. It is however
another aspect when you have to blog regularly, provide interesting content
and manage the feedback created by the posts. It is also interesting to see
that Web 2.0 is seen by the business as mostly a new way to interact with
customers or inside the organisation. It is not yet considered as something
that could be used in B2B relationships or in internal business
applications. This explains also why you can read about the "technological
gap" of traditional IT departments versus these technologies and the fact
that buyers will prefer solutions by large vendors. In large IT
organisation, there is a hesitation to let developers use "new" technology
from new vendors, this can be linked to the time it took to open source
technologies to be widely adopted.

Sources:

The McKinsey Quarterly (March / July 2007
http://www.mckinseyquarterly.com/article_page.aspx?
ar=1913&L2=16&L3=16&srid=17&gp=0

free access with registration)

Web 2.0 baffles businesses, says survey @ theregister.co.uk
http://www.theregister.co.uk/2007/04/24/web_2_baffles_businesses/

IT buyers positive on Web 2.0, survey says / itbusinesss.ca
http://www.itbusiness.ca/it/client/en/home/News.asp?id=44248

courtsey: Methods and Tools August Newsletter article

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