Tag Archives: Web 2.0

Will social technologies improve performance?

English: A tag cloud (a typical Web 2.0 phenom...
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One of the most challenging questions… Will enterprises benefit of Web 2.0 deployments and will such technology improve performance?

On the one hand you see by far too much time spent on Facebook these days and statements like “my whole life is there” are not such unussual amongst the young generation. Therefore, the question is not how you make them use it (they already do) but what benefit you have as a company from using such technologies?

McKinsey’s conclusion is that companies are improving their mastery of social technologies, using them to enhance operations and exploit new market opportunities (“How social technologies are extending the organization,” McKinsey Quarterly, November 2011). They asked 4,261 global executives how their organizations deploy social technologies, including social networking, blogs, video sharing and microblogging, and the benefits gained. The 2011 survey reports that when adopted at scale across an emerging type of networked enterprise and integrated into the work processes of employees, social technologies can boost a company’s financial performance and market share, also confirming last year’s survey results.

I find not quite spectacular the four clusters that emerge from McKinsey’s analysis:
1. Executives at internally networked organizations note the highest improvement in benefits from interactions with employees;
2. Executives at externally networked organizations note the highest improvement in interactions with customers, partners, and suppliers;
3. Executives at fully networked organizations report greater benefits from both internal and external interactions (this result is easy to be assumed out of the first two);
4. In the fourth and by far the largest group, developing organizations, respondents report lower-than-average improvements across all interactions at their organizations.

It’s clear that there is an improvement in communication, especially for large inter-regional organisations but you don’t need a study to know that. What I would be interested in is how this is linked to performance on the job also this would be more difficult to find out once it becomes a way of life and business. Looking ahead three to five years, many respondents expect still more profound organizational changes. They say that with fewer constraints on social technologies at their companies:

  • Boundaries among employees, vendors and customers will blur.

I would raise a red flag here as this might be a signifficant risk management issue.

  • More employee teams will be able to organize themselves.

I would consider it one of the most relevant benefits.

  • Data-driven decision-making will rise in importance.

I’d also add a red flag here considering that Web 2.0 gathers unstructured data and the real challenge will be how to manage such information in a structured way.


New media impact: marketers change their thinking and spending allocations

Social Media Outposts
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Too many companies view marketing plans as little more than an exercise in where and when to buy media placement. Yet as the number of digital interactions increases, marketers must recognize the power that lies beyond traditional paid media.

The changing role of older media and the emergence of newer ones extend the marketer’s role well beyond the allocation of budgets and channels. Marketers today require a deep understanding of how consumers engage with different types of media at each stage of the journey toward a purchase decision. McKinsey’s study “Beyond paid media: Marketing’s new vocabulary” splits the media in 5 categories: paid, owned, earned, sold, and hijacked and makes an analysis of how media are evolving nowadays.

What’s there to think about?

1. Media are becoming more integrated. New ways to connect with customers, for example, are transforming traditional relationship management by requiring marketers to interact with consumers through multiple forms of media in increasingly personalized ways. JetBlue has promoted its Twitter offering through many channels, for instance, and now has about 1.6 million followers seeking a regular feed of special deals for tickets. This approach has given JetBlue the ability to deliver timely coupons at a minimal variable cost, reducing its reliance on expensive paid media while fostering closer relationships with consumers.

2. New publishing models are emerging because the increasing complexity of consumer needs. Computer maker Dell and automobile manufacturer Nissan, for example, worked with the Sundance Channel to create a television talk show hosted by Elvis Costello to attract their target demographic. With ads that seamlessly blended into the show’s content, Dell and Nissan not only gained exposure to a highly engaged audience but also shifted the perception of their brands to connect with Generation X.

3. Applications on wireless devices are spawning tools that provide useful information. For example, eBay’s Red Laser generates a list of prices for any product whose bar code has been scanned by a mobile phone. Beverage companies show where their products are available by overlaying icons onto maps on the screens of mobile phones. In Japan, food manufacturers can increase sales across entire product categories through marketing collaborations with platforms such as Cookpad, the country’s leading online recipe site, with 9 million members, more than 40 percent of whom are women in their 30s.

4. Marketing experiences are becoming more personally relevant. McDonald’s in Japan, for example, has developed expertise in the use of Twitter and other blogging platforms to promote new products and promotions by leveraging its huge fan base to talk about how much they love the company’s food. While this fan promotion is sometimes spontaneous, it’s often facilitated and encouraged by providing these fans with free meals. In this way, paid- and owned-media efforts (such as blog and Twitter campaigns) make consumers so enamored of McDonald’s products that the company generates a significant amount of earned media.

5. The evolution of new kinds of media means that consumers are engaging more often in real-time conversations, particularly on social networks and other digital platforms. One consumer electronics company, for example, has recognized the significance of every review or rating posted about its products. It now responds to all comments within 24 hours: positive feedback gets a thank you, an invitation to become a Facebook friend, and special offers; negative reviews get explanations of how to fix issues, instructions on how to navigate an interface more easily, or follow-up questions to learn more about what the consumer didn’t like. Some hotel chains, recognizing the importance of travel sites (such as the popular TripAdvisor), likewise encourage satisfied guests to post comments online, while employing staff to follow and answer negative comments.

For more details please see McKinsey’s study.

The 160 characters speech. How to get the attention of Generation Y.

Web 2.0

I presented a KM tool this year twice for two different groups in the same company. Once in January and once in June. In January the audience was aged around 30 and over with at least some years of work experience. In June I had people around 20 or slightly over, I assume most of them new joiners.

The presentation was highly interactive, practice-based, with no PowerPoint but… what a difference between the two groups! The first one showed an interest in all aspects of the tool, asked relevant questions to clarify how they can use it best for their own projects and you could see the thrill when they found something new. The second group did not ask many questions and when they did there was more a superficial clarification of functionalities. Moreover, even if it was a new tool for them and highly applicable for their daily job, the thrill of discovery was just not there…

This made me thinking about the new generation. How do you get their attention and what would be a better way to train these people?

Working environment

Raised in an educational culture of working in teams and being highly socially connected through computers, cell phones, text messaging, instant messaging, social networking, blogs, multi-player gaming, etc., the new generation is extremely social-centric. They are building relationships virtually and they are bringing a culture of constantly working together into the workplace – wherever that is. They make sure their friends remain “in the know” by sharing information such as articles, job opportunities or YouTube videos. It is a continual habit – not daily, but hourly.


Statistically, generation Y (and Z) will be the most educated generation ever. According to the “UNESCO Global Education Digest 2010” the number of secondary education students rose from 195 million in 1970 to 526 million in 2008, meanwhile, the number of tertiary students increased by six times over the same period, from 32 million to 159 million students in 2008.

Is this relevant? How much do this change the interest they will show in doing their job at the highest standards? Does this mean they will be ready for a life-long learning environment? In some cases it may be so but I’m not convinced about the majority. Education nowadays is a “must have” because you cannot find a proper job otherwise but I see way too much superficial behaviour here. You can do a paper work a lot faster by web searching today than you could have done it 5 or 6 years ago (needless to say 15 years ago) but you don’t pay much time analysing the information and its sources. Issues such as credibility of sources have melt down into wiki and blog posts. In this way you may have time to chat or post a joke on Facebook but this will not make you a better performer at your work place.


When it comes to learning IBM has found different age groups respond best to different methods of training and professional development. Baby Boomers prefer the traditional structure of a classroom and teacher. Generation X typically opts for online courses that are self-paced, while Generation Y benefits more from social-based learning approaches.

I do agree with IBM’s results. The new generation needs an informal learning environment and messages have to be short and action based. It’s the culture. You need to communicate to them with some of the techniques used in advertising. You have to advertise your new tool the same way you would do with a new tooth paste. Otherwise, they will not be interested in using it. It just won’t create the buzz!

Thinking about all these I reached the conclusion that the best presentation for the new generation is a 160 characters speech. Maybe, just maybe, this “twitter-like” message would have a chance.

And just wait for Generation Z…

52% of executives said their company will increase security spending over the next year

Lokcpick 101
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According to the 2011 Global State of Information Security Survey (conducted by PricewaterhouseCoopers in conjunction with CIO and CSO magazines), out of 12,800 executives from 135 countries, 52% said their company will increase security spending over the next year. Yet many executives said their company’s business partners (52%) and suppliers (50%) have been weakened by economic conditions, a substantial increase from 43% and 42%, respectively, in 2009.

Security executives said their companies also have been impacted by spending restraints, often resulting in the stalling or degradation of some fundamental security capabilities such as conducting personnel background checks and the use of vulnerability scanning tools. Additionally, 47% of respondents said their organization had reduced security-related funding for capital expenditures and 46% said their company had reduced security-related operating expenditures.

The top factors driving information security spending this year are economic conditions (reported by 49% of respondents), business continuity and disaster recovery (40%), company reputation (35%), internal policy compliance (34%) and regulatory compliance (33%).

The only spending driver to show substantial increases this year is “client requirement,” the study found. Client requirement moved up from the bottom of the list in 2007 to near parity with the top-ranking legal/regulatory environment. The rise of client requirement demonstrates the continuing strategic importance and integration of the security department to the business.

Not surprisingly, due to the cost-cutting initiatives taken by most global actors, the 2011 Global State of Information Security Survey also found a significant shift in the ongoing evolution of the CISO’s reporting channel, which has moved away from the CIO in favor of the company’s senior business decision-makers such as the CFO and the CEO.

Risks of social networking and a new role for insurance

The 2011 Global State of Information Security Survey revealed that many companies are unprepared to deal with the potential risks of social networking and other Web 2.0 applications: 60% of respondents said their organization has yet to implement security technologies supporting Web 2.0 exchanges such as social networks, blogs or wikis, according to the survey.

Additionally, 77% of respondents said their organization has not established security policies that address the use of social networks or Web 2.0 technologies. This lack of action on social networking and Web 2.0 technologies can expose organizations to a variety of risks, including loss or leakage of information, damage to the company’s reputation, illegal downloading of pirated material, and identity theft.

The survey also found that many companies are using an additional tool (insurance) to protect the organization from theft or misuse of assets such as sensitive data or customer records: 46% of respondents said their organization has an insurance policy. Additionally, 17% of respondents said their company has made a claim and 13% said their company has collected on a claim.

In Europe, the focus on information security is far more muted, the survey found. Europe now trails other regions in maturity across many security capabilities. Like North America, Europe continues to suffer poor visibility into security events and, as a result, may be unaware of the true impact of events on the business. While 68% of European respondents say their organizations place a high level of importance on protecting sensitive customer information, the responses from other global regions are higher, including Asia (80%), North America (80%), and South America (76%).

Industry specific highlights and further regional information are available here

The value companies have realized from their Web 2.0 deployments

McKinsey Quarterly conducted a survey in June 2009 and received nearly 1,700 executives from around the world, across a range of industries and functional areas. The survey focused on the value they have realized from their Web 2.0 deployments in three main areas: within their organizations; externally, in their relations with customers; and in their dealings with suppliers, partners, and outside experts.

Their responses suggest why Web 2.0 remains of high interest: 69% of respondents report that their companies have gained measurable business benefits, including more innovative products and services, more effective marketing, better access to knowledge, lower cost of doing business, and higher revenues. Companies that made greater use of the technologies, the results show, report even greater benefits. The survey also looked closely at the factors driving these improvements—for example, the types of technologies companies are using, management practices that produce benefits, and any organizational and cultural characteristics that may contribute to the gains. The results show that successful companies not only tightly integrate Web 2.0 technologies with the work flows of their employees but also create a “networked company,” linking themselves with customers and suppliers through the use of Web 2.0 tools. Despite the current recession, respondents overwhelmingly say that they will continue to invest in Web 2.0.

What benefits do Web 2.0 deployments bring to a company?

This year’s survey turned up strong evidence that these advantages are translating into measurable business gains: greater ability to share ideas; improved access to knowledge experts; and reduced costs of communications, travel, and operations. Many respondents also say Web 2.0 tools have decreased the time to market for products and have had the effect of improving employee satisfaction.

Looking beyond company borders, significant benefits have stemmed from better interactions with organizations and customers. The ability to forge closer ties has increased customers’ awareness and consideration of companies’ products and has improved customer satisfaction. Some respondents report that these customer interactions have resulted in measurable increases in revenues.

Respondents cite similar gains resulting from better ties to suppliers and partners: the ability to gain access to expertise outside company walls more quickly, lower costs of communication with business partners and lower travel costs.

How do companies use Web 2.0?

Among respondents who report seeing benefits within their companies, many cite blogs, RSS, and social networks as important means of exchanging knowledge. These networks often help companies coalesce affinity groups internally. Finally, respondents report using Web videos more frequently since the previous survey; technology improvements have made videos easier to produce and disseminate within organizations.

Respondents who report that Web technologies have strengthened their companies’ links to customers also cite blogs and social networks as important. Both allow companies to distribute product information more readily and, perhaps more critically, they invite customer feedback and even participation in the creation of products.

What’s next?

• Over half of the companies in this year’s survey plan to increase their investments in Web 2.0 technologies, while another quarter expect to maintain investments at current levels.
• The current downturn has increased interest in the technologies, presumably because companies count on extending their gains.
• About 1/3 of respondents have not yet achieved business benefits, either because they aren’t using Web 2.0 for one of the three major usage categories (internal, customer, and partner/supplier) or because they have yet to learn how to achieve measurable benefits with the tools they are using.

For a closer look at how companies are using Web 2.0 and their benefits, see the articles “Business and Web 2.0: An interactive feature,” and “How companies are benefiting from Web 2.0” on www.mckinseyquarterly.com