The Two-Year Lag from Web 2.0 to Enterprise 2.0

by Hutch Carpenter

The Enterprise 2.0 sector draws heavy inspiration from innovations in the Web 2.0 world. Indeed, the name itself, Enterprise '2.0' reflects this influence. From a product management perspective, Web 2.0, and its derivations social networking and social media are great proving grounds for features before coding them into your application.

A fruitful area to review is how long it takes for a feature to go from some level of decent adoption in the consumer realm to becoming part of the mainstream Enterprise 2.0 vendor landscape. The list of features that have made the jump - forums, wikis, blogs, tagging, social networking, activity streams, status updates - is impressive. Let's look at three features that made the leap, with an eye toward how long it took.



Here's the back-up for those dates.

Wikis: Wikis got their start back in 1995. From there they grew, and the application became popular with computer programmers. But it hadn't caught hold outside that culture. Wikipedia was launched in January 2001, and grew rapidly over its first two years. It wasn't yet mainstream, but it clearly had caught a wave among early adopters. As recounted on the history of wikis page in Wikipedia, 2004-2006 saw an explosion of interest in wikis from companies.

Social networking: Defined as enabling social profiles, and connecting with others. Facebook started in 2004, and grew very popular among colleges. In 2006, it opened up its membership beyond college students, and turned down a $1 billion offer from Yahoo! Clearly, the company was on fire (even then).

In April 2008, Jive released Clearspace 2.0, which was touted as Facebook for the enterprise. Socialtext 3.0 was released in September 2008, and it included Socialtext People, its social networking feature. And I can tell you that at BEA Systems, there was a second quarter 2008 release of a Facebook for the enterprise in the Aqualogic product line.

Microblogging: Twitter. The source of it all. Twitter actually was conceived as an idea back in 2000, and company was started from a 2006 brainstorming session at Odeo. But it really hit big with the early adopter set at 2007's South by Southwest (SXSW).

Microblogging broke into the Enterprise 2.0 world when Yammer won best-of-show at the September 2008 TechCrunch 50. But that doesn't count as mainstreaming into Enterprise 2.0. Yammer proceeded to grow strongly the next few months. And Socialtext introduced Signals in March 2009.

So there's some documentation backing my 2-year cycle for Web 2.0 innovations to move from hitting the early adopter set to the Enterprise 2.0 sector. Note that this doesn't apply to every Web 2.0 innovation. No one ever talked about "MySpace for the Enterprise" and there's really not a Flickr in the Enterprise 2.0 umbrella.

Which raises a question about today's hottest Web 2.0 trend...

Foursquare for the Enterprise?

Foursquare, and its up-n-coming competitor Gowalla, are all the rage these days. These location-based social networks are good for seeing what friends are doing. Foursquare also integrates features that reward participation (points), add a sense of competition (mayors) and provide recognition (badges).

Mark Fidelman recently wrote about Foursquare and Enterprise 2.0. And using our handy two-year lag calculation, somewhere in early 2012 the first mainstream Enterprise 2.0 will integrate Foursquare features. Actually, two of them.


Location check-ins

Employees will check in their locations from all around the globe. Sales meetings, customer on-site deployments, sourcing trips, conferences, etc. Sure, this info might be in the Outlook Calendar. But even if it is, Outlook Calendar entries aren't social objects. These check-ins will allow you to know where colleagues are, including those you don't know well. But wouldn't it be nice to know if some other employee visited someplace you're investigating?

These check-ins can be even more tactical. Folks who are part of a meeting in a conference room all check-in. Voila! Meeting attendance, which everyone can see. For an individual employee, these check-ins become a personal history of what you did over the past week.


Mayorships, Badges, Points

Foursquare makes it fun, and for many people, addicting, to check-in. You get points and *bonuses* when you check into the places you go. If you check in to the same place enough times, you get to be mayor of a venue and tweet it about it. You earn badges for accomplishing different things in the Foursquare system.

These features have had the effect of motivating legions of people to participate. It's fun to see your stats. It's fun to get a little competitive. It's great when you get that notification that you've earned a new badge.

Andrew McAfee wrote a series of posts exploring the question of whether knowledge workers should have Enterprise 2.0 ratings. This chart was from one of his posts:



Well, the Foursquare approach certainly takes us down this path, albeit in a fun way.

So what do you think? Personally, I'm looking forward to more Foursquare in the enterprise.


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Hutch Carpenter is the Vice President of Product at Spigit. Spigit integrates social collaboration tools into a SaaS enterprise idea management platform used by global Fortune 2000 firms to drive innovation.

Finding Experts In Your Pursuit of Innovation

by Gil Yehuda

I attended a KM conference recently where a speaker remarked on how difficult it was to find experts in his company. He suggested that HR create a database and every employee should declare that they are an expert in something. Then when a manager needs to find an expert for an innovation project, he or she could query the database.

There's more to this story, and I'll share the details in two blog posts that I plan to publish about this conference. But I wanted to take an excursion and talk about expertise locators.

The expert database idea is doomed to fail. It will never be accurate or updated. But the problem of finding experts in your company is real. One would think that there should be a way to organize a list of experts. Databases are the wrong solution (I'll explain why). But what solution would work?

I'm excited about the approach that Aardvark is taking to solve this problem in the consumer space. I think it would translate well to the corporate space too. First let's talk about the mechanics of the solution, then why it is so interesting. When you sign on and set up your profile, you declare the topics that you consider yourself to be an expert in. They list many, and you can add any you want. So far, this seems like a database. But wait. Then you connect your network and set up how large of a network you want to engage with. You can invite people directly, via Facebook, gMail contacts or other means in order to set up your network. Then you specify how far you want your awareness to traverse - e.g. to limit interactions to your friends only, or include their friends in your trust circle. OK - you set it up like you would many other social networking sites. If this was an enterprise vendor - then you'd set it up via active directory so it would know which division you are in, who you report to, etc.

As a participant you can ask questions and answer questions. When you ask a question, you specify the topic, and Aardvark sends the question to those people in your network who said they are experts in that topic. Similarly, you can expect to get asked questions once in a while (you determine how often) about the topics that you said you are an expert in. This participation continues - every so often you get a question, and if you have the time and the answer, you help out. If not, that's OK too. After all, you are helping out your friends or their friends - something that we do all the time.

But many times you'll find that you are not so much of an expert that you think you were. You start getting questions you can't answer. Aardvark will ask you if you want to modify your topics. It does this in a very subtle way. If you decline to answer a question, it just asks - are you busy now (if so it will not bother you for a while) or is this a topic that you don't want to be asked about? Sometimes you get a question about a topic that is similar to one that you said you were an expert in, and Aardvark asks you if you want to include that topic on your list. You can set that up automatically so that it adds topics to your expertise list if you answer questions about them. Your answers get rated "helpful" if they are indeed helpful. There are other features too, it's pretty clever and easy - and I dare say, fun to use.

Most importantly - Aardvark refines your list of topics based on your ability to answer questions. It is better than a static database could ever be.

But the big "aha" about this for me is thinking about a corporate version of Aardvark. Over time your expertise would be recognized based on what you actually know and share - not based on what you once answered in an HR survey. This solves a very challenging business problem with a simple, fun solution.

At this conference I introduced myself as someone who helps companies solve problems by leveraging social software tools and behaviors. Finding experts is a problem. Creating a closed stagnant database is a poor solution to that problem. But creating a dynamic system is a much smarter approach. First of all you get people answering questions - which saves time and money. And secondly, by leveraging social computing tools (and staying away from emails that hide conversations) it becomes clear who the experts really are. Employees might want to answer questions to demonstrate what they are capable of. And administrators can manage the system so that no one person gets too many questions. Let's say you get no more than two questions a week - that's not such a burden. Let's say the answer is "go to the corporate librarian" - OK, that's a good answer too sometimes. But having this kind of system solves a set of business problems that the old database would never solve.

It also solves one other problem - improving knowledge. Let's say I give an answer to a question that is not complete or correct. Then another friend/coworker (who is in the network and is also an expert in the topic) steps in and contributes more to the answer. The person who asked has the benefit of a better answer, and I get the benefit of learning something I didn't know. Next time someone asks I'll know more, or I'll refer the question to my friend who knows this topic better than I do. That's a win all around.

The next question is how to get experts to share their expertise? I'll post the response I gave at the conference - look for it next week on this blog.

Disclosure: I have no relationship with Aardvark and do not know if they plan a corporate edition. I'm just mentioning them because I'm impressed with what I see in their approach.

Editor's Note: Google recently acquired Aardark for $50 million. What will they do with it? I guess we will have to wait and see.


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Gil Yehuda is web strategy consultant at GilYehuda.com who helps organizations leverage Enterprise 2.0 tools and behaviors to meet their business goals. He is a former Forrester analyst and Enterprise Architect.

Ideas Are Core to Enterprise 2.0

by Hutch Carpenter

Brian Solis spoke recently on what the future of social networks will be. Ideas, it turns out. As I wrote on another blog post:


"Solis, leading thinker in the integration of social media and PR, recently spoke on an intriguing concept: ideas connect us more than relationships. The premise of his argument is that ideas are what elicit passion in people. They animate us, and if we find someone with a similar interest in a given idea, we connect."


Then there was this observation by Intel's Enterprise 2.0 lead Laurie Buczek on the only quantifiable value they found in their Enterprise 2.0 efforts:


"Where we did quickly find quantifiable business value during an ideation proof of concept. Ideas that are discovered and turned into action have produced dollarized return of business value."


Both Brian and Laurie are pointing to the unique nature of ideas. Brian talks of ideas as connectors. Laurie talks of ideas being 'discovered'. If Enterprise 2.0 rests on delivering value through collaborative, emergent and social means, ideas are the top basis for leveraging these qualities.

Of course, from a pragmatic, what-do-businesses-care-about perspective, innovation is a top priority.

The top-down, Board-level importance of innovation is not a surprise. As I've seen repeatedly with our enterprise innovation work at Spigit, ideas are an excellent bottom-up basis for Enterprise 2.0.


Ideas Are Me

Perhaps the most important aspect of social is the ability to express what you're thinking. Ideas fit this dynamic quite well. Ideas are...

• Expressions of my creativity, ingenuity and problem-solving

Inside companies, we see things that we know can be improved. We see opportunities that need to be explored. We know a good answer for a particular challenge put forth by managers.

Every time you have an idea, a bit of you bonds to it. Your way of thinking, your understanding of context, the experiences you've had, the expertise you bring to bear, the work aspirations you have.

Ideas can be small, giving you satisfaction in fixing something obvious to you. They can be big, offering the possibility of work that elicits your passions.

This is powerful stuff. It is a unique intersection of something that helps the company with something that personally satisfies you.


Ideas Are the Basis for Finding Like-Minded Colleagues

When I post an idea, I create the basis for finding others. That because when I post an idea, I'm making...

• A call for your interest

Think about that. The act of publishing an idea is a broadcast across the organization. It's a tentative query to see who else feels the same way. Or if not the same way, who has an interest that overlaps mine.

This is unique to ideas. Ideas are potential. They are a change from the status quo. There are others who share at least some aspect of your idea. In large, distributed organizations, where are these people?!!

My idea is my call to form my own virtual team, to see who can help me accomplish something of value to me and the organization. I contrast this with other types of activities one might do under the Enterprise 2.0 umbrella: status updates, project tasks, writing a common document, adding content to knowledge wiki. Those aren't calls to form virtual teams.

Ideas have a unique quality in team and community forming, consistent with the emergent nature of Enterprise 2.0.


Ideas Are Social Objects

A key consideration of any framework for interaction is, "what are we going to talk about?" Within the enterprise environment, an idea is...

• A social object for our interaction

The concept of social objects is powerful. It illuminates the core basis for why two or more people interact. They share an interest in some thing. We are complex beings, with multiple different interests. We won't ever match up with someone else exactly in terms of what animates. But social objects allow a sort of miniature Venn Diagram of our common interests to flourish.

Hugh MacLeod pragmatically notes, "The Social Object, in a nutshell, is the reason two people are talking to each other, as opposed to talking to somebody else."

Leading designer Joshua Porter, also known as Bokardo. In his post, Finding Innovation in Design, he describes the AOF method of social experience design:

• A = activity you want to support
  
• O = social objects that define the activity
  
• F = features are actions people take upon social objects

You build social-oriented sites around a core set of objects and activities which attract people.

Ideas, because they represent something new, something that can affect your daily work, are terrific social objects. An idea is a proposal, and a natural basis for interacting. Contrast this with posting a document, or a page of knowledge, or a status update. Those are lower wattage, more ephemeral social objects.


Ideas Become Projects

Ideas get attention. They propose to change things, and they will need work. An idea is...

• The basis of a future project for us

What makes ideas so powerful is they are changes to the status quo. This means:

• They're going to affect people's daily work
  
• They require some work to make happen

This imbue ideas with a certain vitality. It gives them a power not seen with with other types of social computing activities, save projects themselves.

Another important aspect is that ideas will elicit passion in certain users, those we talked about earlier. If there is a chance to become part of a project team working on the idea, that is exciting. Consider times in your life you got to be part of a team, working on something that excited you.

Ideas have these qualities: possibilities, change to work routines, chance to be part of an exciting initiative. Projects have a certain aspirational quality for us employees, and ideas tap this aspect well.

There are many types of content and activities - social objects - that are part of a social computing initiative. I'd argue ideas, for a host of reasons, should be considered top amongst those social objects.


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Hutch Carpenter is the Vice President of Product at Spigit. Spigit integrates social collaboration tools into a SaaS enterprise idea management platform used by global Fortune 2000 firms to drive innovation.

Three Enterprise 2.0 Themes to Watch in 2010

by Hutch Carpenter

Enterprise 2.0 continued its growth and maturation in 2009. We saw the rise of the Enterprise 2.0 consultancies, including Dachis Group, Altimeter Group and Pragmatic Enterprise 2.0. Andrew McAfee published his book about Enterprise 2.0. We saw the rise of the 2.0 Adoption Council. And based on what can be gleaned from vendors, more enterprises are deploying social software.

For 2010, three themes will impact the sector. These aren't the only ones, but I expect to see plenty of news, features and industry mental energy covering these.


#1: Impact of SharePoint 2010

It's coming. SharePoint 2010. Microsoft's upcoming release for the enterprise received good attention during the SharePoint Conference in Las Vegas. Features include:

• Social profiles
  
• An actual wiki
  
• Blogs
  
• Activity streams
  
• Status updates
  
• Presence status
  
• Social bookmarking
  
• Tags
  
• Ratings

As a list of capabilities, this certainly is impressive and quite a departure from SharePoint 2007's social software efforts. The devil is in the details, of course.

But generally, customers who have been "making do" with 2007 will suddenly have an attractive option from Microsoft. SharePoint 2010 will likely be a big catalyst for Enterprise 2.0 growth.

The coming release of SharePoint 2010 is forcing many vendors to evaluate their positions in the market. Going head-to-head with the same or fewer features is going to be tough. What differentiates your offering? My Jaws picture refers to this dynamic facing Enterprise 2.0 vendors.

There will be articles reviewing 2010. There will be blog posts dismissing its capabilities or lack thereof. But there will be impact in the corporate world.


#2: Enterprise 2.0 Becomes "Like Air"

At Defrag 2008, I caught Charlene Li's presentation, where she said, "social networks will be like air." The premise of her talk is that social network aspects will become less a destination URL and more an integrated part of experience throughout the web and mobile.

We're seeing signs of a similar shift in the enterprise. Enterprise 2.0 is becoming less a destination and many of its concepts are being integrated into non-social software apps. Salesforce's Chatter and Tibco's Tibbr were end-of-year examples of this. As Dana Gardner writes on Seeking Alpha:


"This is a clear sign that the enterprise software and social software worlds are munging. Get ready to see a lot more."


Salesforce and Tibco won't be the last. Expect more announcements in this vein for 2010. Mike Gotta noted that this concept was called "contextual collaboration", and was promoted by Matt Cain in the late 1990s. The web 2.0 tools of today are better, more diverse, more scalable and better adapted to human behaviors than whatever was available a decade ago.

Putting these tools in-the-flow will be a powerful basis for expanding Enterprise 2.0's reach. A challenge for standalone general tools of today is that they require employees to toggle between different apps. This can make it tough to get traction. For example, Intellipedia has been making a difference, but it's still just "a marginal revolution." Not all agencies have made it part of daily work.

In the European Oracle Enterprise 2.0 Group on LinkedIn, Oracle's VP of Enterprise 2.0 for EMEA asked this question:


"What the article doesn't cover and where I would be interested in your views is how the use of E2.0 tools would enable the Business Processes themselves to be changed. Or innovated completely. For example, how do you bring Crowdsourcing, Idea Engines, Prediction Markets etc and integrate those into ERP systems?"


Yes, even Oracle is discussing this concept. Watch how this theme unfolds in 2010.


#3: Enterprise 2.0 Market Stratifies

I see the Enterprise 2.0 market splitting into these two models:

1. General collaboration suites that replace intranets and portals


2. Specialized applications that deliver tangible value around a specific activity

Watching the progression of general collaboration suite vendors, I've always believed their ultimate goal is to replace existing 1.0 intranets and portals. After all, once an Enterprise 2.0 vendor's solution...

• has the ability to store and organize files,


• provides pages for company-wide and team-specific communications,


• offers powerful search capabilities,


• includes APIs for third party integration,


• can be organized into multiple spaces, and


• has a superset of the elements of the corporate directory,

...why would a company maintain both the intranet and the social software suite. Pick one. The Enterprise 2.0 vendors still need to mature their product further to become the company intranet/portal. But I see that as their destination.

Meanwhile, a new crop of vendors have dispensed with the pursuit of all-everything suite approach. Rather, they build applications that integrate social in solving specific problems (e.g. Spigit for innovation management). Gartner analyst Anthony Bradley tabs these vendors' offerings as "activity-specific social applications". These vendors build in functionality that solves specific problems for companies, usually with definable ROI.

I expect the general collaboration suite vendors will offer their own specialized modules as well, in order to offer tangible ROI solutions to their customers.

Watch how this stratification dynamic plays out in 2010.

Those are my thoughts - what do you think?

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Hutch Carpenter is the Vice President of Product at Spigit. Spigit integrates social collaboration tools into a SaaS enterprise idea management platform used by global Fortune 2000 firms to drive innovation.

Human Capital x Social Capital = Productivity and Innovation

by Meri Gruber

As a culture we like to think of our achievements as the triumph of the individual. But last week I used a memorable chicken breeding example to show you that group performance outweighs individual performance in a group environment because a focus on individual performance comes at a cost to the group performance.

The reality is that company performance is a complex group effort. Without positive group productivity, companies under perform. And most companies under perform. We are used to seeing numbers like 90% of companies fail to execute on their goals, that excellence in business execution is the chief concern of CEO's. What's going on here? "Companies assume people are atomistic and economic, versus social creatures", writes Stanford professors Jeffrey Pfeffer and Bob Sutton in "The Knowing-Doing Gap, How Smart Companies Turn Knowledge into Action."

There are two things going on here that get in the way of group productivity, two deeply held organizational operating assumptions that are completely out of sync with reality. The first is that company performance is atomistic. The atomistic model assumes individual control and that company results are the consequence of individual decisions. The second is that individual performance is motivated largely by extrinsic, (financial) rewards based on individual performance." Companies operate on oversimplified or incorrect models of human behavior relevant to shareholder (short term) interests, irrelevant or counterproductive for ultimate success of the business."

In "Managing the 21st century organization", Valdis Krebs of orgnet.com reminds us that what you know (human capital) multiplied by who you know (social capital) creates productivity and innovation. Traditional company hierarchies have an up-down formal information flow: you report up the chain, you receive information down the chain. But to actually get your work done, you tap into the organization sideways so to speak, leveraging your informal contacts across the company.

Research sited by Krebs found that "the ability to reach a diverse set of others in the network through very few links was the key to success for both individuals and teams." We know this from our own experience. A good networker gets more stuff done because companies are not atomistic, they are complex group environments. So if you think about it, with the exception of the few jobs in the company that don't interact with anyone, you should be interviewing people for their social skills, not their functional skills.

We might be done there, but we're not. Because relying on social skills and ad-hoc networking is terribly inefficient and capricious. And all too often, it is down right discouraged by performance targets that misunderstand human motivation and pit employees against each other in an endless game of internal competition. At a recent TED talk, Dan Pink, author of "A Whole New Mind, Why Right Brainers will Rule the Future", made the case for businesses to rethink their "business operating system":


"There is a mismatch between what science knows and what business does. And what worries me, as we stand here in the rubble of the economic collapse, is that too many organizations are making their decisions, their policies about talent and people, based on assumptions that are outdated, unexamined, and rooted more in folklore than in science. And if we really want to get out of this economic mess, and if we really want high performance on those definitional tasks of the 21st century, the solution is not to do more of the wrong things. To entice people with a sweeter carrot, or threaten them with a sharper stick. We need a whole new approach."


Innovation and productivity doesn't happen by carrot or stick, it happens through connectivity. What Pfeffer and Sutton found was that "firms where measurement helped measured things that were core to their culture and values and intimately tied to their basic business model and strategy, and used these measures to make business processes visible to all employees."

To close the group productivity gap and foster innovation, enable and empower connectivity in your company. This requires you to revisit your assumptions about company performance and individual motivation. So before your write "superstar wanted" in you next job tweet, read the chicken story one more time. Hopefully you will come to realize that "super collaborator" is what you really need. And before you start your quarterly/annual performance goal setting process, listen to Dan Pink's TED talk one more time on what really motivates and stimulates the kinds of creative solutions you need today.

Finally, think about group productivity as part of an overall business execution platform. The mindful implementation of Enterprise 2.0 emergent social software platforms and performance management solutions are components of a connected company, and a connected company outperforms its peers. What does this kind of emergent business execution platform look like? Stay tuned.

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Meri Gruber is a leading expert on business execution. She blogs on the intersection of innovation and business execution at www.competingonexecution.com

Importance of Enterprise 2.0 Connections to Innovation ROI

by Hutch Carpenter

In a recent post on the Spigit blog, Study - Collaborative Networks Produce Better Ideas, I described the research of Professor Ronald Burt. He found that employees who are better connected across the organization generate higher quality ideas than those with limited connections. Wider access to the ideas, knowledge, experiences and judgment of colleagues makes employees stronger in innovation.

I posted this write-up in the Continuous Innovation group on LinkedIn. One person made this observation:


"Need to keep in mind that collaborative networks have little to do with technology. There are certain personality types that keep the organization connected. The proportions of those people in an organization is related to the specific corporate culture."


There's a good alternative perspective. That really, the same people that connect via collaborative networks are those that would be doing it in an offline world as well. The rest of the employee population likely continues to work in a more insular world.

I see it differently though. First, I agree that there are people with natural connector personalities. They would span the different parts of the organization no matter what. Anyone think David Armano wouldn't be one of those types?

But not everyone need be an uber connector to see benefits from plugging into a more connected network. My personal experience on sites like Twitter and FriendFeed tells me that everyone benefits from these online social networks. We may not all be uber connectors, but we do increase our degree of connectedness.

The graph below is my concept for how this effect manifests:



Assume a population of employees: 25 in this hypothetical example. The blue line is the level of connectedness for employees working the way they have for decades. Your connections tend to be local and departmental, with some tenure you gain a larger informal network. In Professor Burt's terms, most workers are relatively insular in terms of who they access for information and ideas. But some broker connections across different corporate 'tribes'.

The red line represents the level of corporate connectedness for employees including the ability to find others online. To me, this is a no-brainer. Of course people are going to connect with others they wouldn't have otherwise. The number, diversity and depth of connections increase.

The gray zone between the red and blue lines represent that improvement. Some people won't get too much increase. They really are in-person types of connectors. But others thrive in the online environment. They have more specific interests, and didn't know who else in the organization held them. Through the social software, they find more people with interests similar to theirs. Or at least with experience relevant to their interests.

Don't need to be an uber connector there. Just need to be able to make connections.

Next..the ROI math.


The Natural Logarithm Method

Take a look at the graph below. It shows the scatter plot of how ideas were rated for different employees (Y axis). The X axis represents the degree of connectedness for employees, based on actual social network analysis conducted by Professor Burt in his study:



The scatter plots show that employees who have a high diversity of connections across the organization provided higher quality ideas. The converse holds true as well.

Regression shows the equation that represents the observations:


Value of Idea = 5.51 - 0.91 * ln(Level of Network Constraint)


The equation shows that, on average, every increase in a person's level of connectedness with different parts of the organization produces higher quality ideas. Note the natural log curve. The effect increases as connectedness improves. What I like about that is that the benefits increase, even if the work of increasing employees' network diversity gets more difficult as you try to connect those last holdout groups.

Extrapolate the effect out to the organization at large. Raising the overall level of workforce connectedness will have a salutary effect on the average quality of ideas generated. In an era of ever higher levels of market volatility, improving the organizational 'innovation IQ' is a critical aspect of surviving and thriving.

One thought on the accelerating benefit - increased idea quality - as connectedness improves. In a large population, would this have any correlation to network effects?

It's not perfect, but Professor Burt's analysis demonstrates a strong ROI basis for leveraging social software to increase the diversity of connections.

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Hutch Carpenter is the Director of Marketing at Spigit. Spigit integrates social collaboration tools into a SaaS enterprise idea management platform used by global Fortune 2000 firms to drive innovation.

What is Innovation Management?

"Innovation 'Management' as a term, doesn't sit well with me. Just like Knowledge 'Management'. KM failed in part because of the inherent controls."

Sameer Patel, April 22, 2009


by Hutch Carpenter

I thought this was a good comment by Sameer, as it reflects a couple things:

• Nascent field of technology tools that specifically facilitate and improve corporate innovation is just becoming understood


• Concern that the unpredictable and rough-edged aspects of idea generation will be smothered by ham-handed managerial controls

Seeing what's happening with customers at Spigit, I can safely say that the field of innovation management is much richer and collaborative than the term might connote. It's not so much 'control' management as it is 'optimization' management. It's a recognition that companies have significant margin for improvement in their innovation processes and outcomes.

With that in mind, I wanted to put forth eight elements that help describe 'innovation management'. This list is by no means exhaustive, but it should give you a feel for what the field is about today.


#1: Innovation benefits from a range of perspectives

For most of our industrial history, innovation has been the province of an internal R&D team. Those smart geeky types who labored to create the next generation of products for big concerns. Fast forward to where we are today. With the rise of the Information Age, more people have a knowledge-based relationship with their employers.

Contributing what you know has become the dominant part of work in Fortune 2000 companies. Leveraging this trend into the innovation realm is a natural extension of employees' work. And indeed, once done, it becomes apparent that so-called 'line workers' have a lot of valuable knowledge, experience and ideas as well. You don't need an advanced degree to understand a glaring customer issue or a better way to manage field operations.

Studies show that exposing ideas to a wider range of perspectives significantly improves them. In terms of management, the change for companies is elevating the importance of sourcing ideas from throughout the enterprise, as well as outside of it. One example: in this video on how it approaches innovation, Pfizer notes that "Ideas aren't just sitting at headquarters. There are fantastic ideas all over the company."


#2: Four of the most damaging words an employee can say: "Aww, forget about it"

Ideas come in various forms: disruptive, product and operational. And they hit employees at varying times as they do their work. Sure, a lot of these ideas won't be feasible. But a lot will.

The problem for companies is that employees self-censor, either because (i) culturally they're not encouraged to post ideas, even potentially bad ones; or (ii) there's no way to easily capture these.

The recognition that there is valuable intellectual capital in the ideas that emerge from employees' knowledge and activities is core to improving corporate innovation. Changing organizational focus to foster more ideas from all quarters, and providing the resources to capture these are core to what innovation management means.


#3: Create a culture of constant choices

Jim Collins spoke recently at the Front End of Innovation conference. A key theme from his speech was that great companies enable constant choices. By this, he means that external markets are constantly changing. Companies that are maintaining a good velocity of ideas are the ones that succeed long-term in industries.

This is actually a pretty significant cultural dynamic. Companies can be quite adept at execution, and throwing choices in front of everyone can disrupt that strength. So figuring out 'their way' to create a culture of constant choices is really the hard work.

This is part of what is meant by innovation management.


#4: Looking at innovation as a discipline

Innovation is a Top 3 priority for companies, reports Boston Consulting Group. Indeed, BCG notes that innovation leaders generate 430 basis points more in shareholder returns than do average companies. So how does a company systematically address innovation as a discipline?

Companies apply resources and attention to a number of other disciplines: sales, customer relationship management, supply chain management, managerial accounting, etc. Looking at innovation from a similar perspective is emerging as an important strategy.

A number of large corporates have established internal innovation-focused executives. These aren't employees who are supposed to dream up all the ideas. Their work is on establishing innovation as a discipline. Their charge is wide-ranging, including HR, executive attention, focus areas for innovation, internal communication, processes and selection of technology to facilitate. While I wasn't around in the rise of the CRM era, presumably there was similar work by earlier generations of employees.

The work of making innovation a discipline is part of innovation management.


#5: Focus employees' innovation priorities

Each of us knows a lot. From a variety of activities and interests. Work. Hobbies. Family. Locale. Life. I'll bet you come up with ideas and encounter problems to be solved for a wide variety of things.

For corporations, this wealth of experience is an asset, but it does require some tuning. For ideas, you never know when someone's personal church activities might have relevance to a product idea for the company. You want that variety of perspectives to inform and improve ideas.

At the same time, there needs to be a channeling of where employees' ideas are focused. If executives don't lay down directional areas for innovation, employees' time on innovation will not be as valuable as it could be. Of course they're going to have a range of ideas. But which ones are most pertinent to the company's success in the market?

Channeling employees' innovation focus is part of innovation management.


#6: Recognizing innovation as a funnel with valuable leaks

When one views innovation as not just game-changing disruptive ideas, but including incremental ideas, it becomes clear that innovation is fundamentally a funnel. Start with a large, ongoing quantity of ideas drawn from employees, customers and partners. As discussed in #2 above, you really want to get as many of these ideas as you can.

Ideas must then go through a winnowing process. Some will get stronger, and advance to projects. Some will fall away as not feasible.

And from all this intellectual activity around ideas, new ideas will emerge. It's natural. Once employees are in the mode of generating and assessing ideas, it nwill be natural for new ones to emerge. Really, this arguably is the case for a lot activities that foster interaction among employees. But in this case, the social object around which they're interacting is an idea. In terms of instilling a culture of constant choices, interaction around ideas promises to be a key part of achieving that.

Managing the funnel is part of innovation management.


#7: Establishing a common platform for innovation is a revolutionary step forward

Consider how employees innovate today. You have an idea, what are you going to do with it? Certainly you'll sound it out with peers, which is illustrative of the fact that innovation is a social activity. Then what? Tell your boss. Email it. Enter it into a customer service database. Put it in a PowerPoint. Try to schdule meetings.

When you consider what employees must do today to move an idea forward, it's really pretty daunting. Under this system, corporate innovation requires phenomenal acts of heroism to get anything done. Ad hoc, siloed applications make companies the poorer for the ideas they're missing. Existing idea management processes don't allow cross-enterprise visibility, which means collaboration among interested parties is limited. An unfortunate outcome is that the pace of innovation falters as ideas lose share of mind.

Creating the common community space for innovation is a dramatic leap forward in how companies foster innovation. The same mechanisms of departmental outreach and email are certainly still available. But now, ideas can get an audience of thousands, allowing them tap different reservoirs of experience and perspective. Senior executives csn see ideas that previously would languish in lower levels of the organization.

Creating this common platform is part of innovation management.


#8: Innovation must be more than purely emergent, disorganized and viral

Innovation management today draws heavily from the themes of Enterprise 2.0. Key to the power of social computing is letting employees' activities and knowledge apply itself naturally where it's needed throughout an organization. For purists, this means get rid of oversight and managerial prerogatives.

To create ongoing, sustainable innovation, there needs to be a programmatic approach. Riding the pure emergent form of Enterprise 2.0, or continuing the current ad hoc, siloed approaches to idea management, is insufficient. Employees will be busy with projects and tasks they need to execute. Perhaps culturally, innovation hasn't been a focus. There will need to be a push to raise the awareness of innovation. And some organization to channel it where it's needed.

There will also be ideas that are valuable, but which may not resonate with a broader section of the employee base. Leaving the emergence of these ideas purely to viral dissemination means leaving some of them buried at the departmental level. Companies need ways to ensure valuable ideas are caught and surfaced systematically.

Combining bottom-up emergence with top-down priorities and organization is part of innovation management.


Wrap-Up

As I said above, innovation is a multi-faceted activity, with many moving parts and ways of approaching it. What I've listed here represent my way of clarifying what the field of 'innovation management' is about. If you think I'm off or missed something, let me know in the comments below.

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Hutch Carpenter is the Director of Marketing at Spigit. Spigit integrates social collaboration tools into a SaaS enterprise idea management platform used by global Fortune 2000 firms to drive innovation.

Why Don't Democracies Suffer Famines?

by Hutch Carpenter

In his keynote at the Spigit Customer Summit, Gary Hamel said that something that caught my attention: democracies don't suffer famines. Hearing this, I was intrigued and did some research.

Amartya Sen, winner of the 1998 Nobel Prize in Economics, made this empirical observation:

One of the remarkable facts in the terrible history of famine is that no substantial famine has ever occurred in a country with a democratic form of government and a relatively free press.


Why? In a paper from the John F. Kennedy School of Government at Harvard University, Sean M. Lynn-Jones puts forth two reasons:

First, in democracies governments are accountable to their populations and their leaders have electoral incentives to prevent mass starvation. The need to be reelected impels politicians to ensure that their people do not starve.

Second, the existence of a free press and the free flow of information in democracies prevents famine by serving as an early warning system on the effects of natural catastrophes such as floods and droughts that may cause food scarcities.


Isn't that powerful? Simplifying things, I distill those two reasons into these:

1. Organizational responsiveness


2. Distributed trend detection

Both of which describe the realm of what Enterprise 2.0 is about, albeit without the life-and-death issue of starvation. That in itself is interesting enough. But when you try to apply those findings to companies, you realize they don't quite mesh with today's corporate governance models.

Corporations Aren't Democracies

You, the reader, probably say "duh" to the observation that corporations aren't democracies. But to consider the benefits of organizational responsiveness and distributed trend detection, it's important to understand a crucial difference between democracies and corporations. The diagram below shows the corporate governance model:


In the context of making organizations more responsive, and distributing trend detection, where does that happen? It's the employees. They're the ones on the front line. They're getting creative to solve issues everyday. They hear things from the market before most do. They want to make a difference and see their companies progress.

This is the equivalent of the voters in a democracy. The ones who are experiencing issues firsthand. But employees aren't empowered to change their organizations. That's the C-Level suite: CEO, COO, CFO, etc.

The C-Level suite lives a life of leading employees, and listening to the Board of Directors. Well listening, and leading, the Board. And the Board serves at the pleasure of shareholders.

In this model, shareholders look at company results and estimate future overall growth in revenue and profits. Fail to hit the numbers, and they put pressure on the Board. Board feels the pressure, and begin to question the C-Level suite. C-Level suite makes changes, and/or is replaced.

Notice that train of actions - it's not the feedback from employees that drives changes. It's a look-back at the results by shareholders. This isn't to say that C-Level executives do not listen to employees. But the structural governance model sets the pecking order for who and what gets attention.

Bringing the Voice of the 'Governed' into the Enterprise Conversation

As someone who went to business school, I'm a firm believer in the accountability to shareholders governance model. Capital is scarce, and its efficient allocation across the economy is valuable for ensuring generally sufficient supplies of products and services needed by the population.

But that doesn't mean the C-Level executives can't change the way they manage to improve the prospects of their companies and returns for their shareholders. As has been pointed out before, companies are experiencing unprecedented levels of volatility in markets today. Sources of industry change come from multiple directions, and their speed of invasion is much faster.

Maintaining a model of listening only to their senior executives, their Board and their shareholders is becoming a risky strategy for CEOs. It means listening to people whose interests are certainly in seeing a strong, healthy company, but whose capacity to provide early trend detection and problem-solving creativity is limited. Shareholders aren't in the trenches of your company's operations. The Board of Directors is made up of C-Level executives from other companies, who need to worry about their own operations.

Gary Hamel discussed W.L Gore as a model of a company where employees are much more a part of the corporate governance model. From Fast Company in February this year, here's a quick update on W.L. Gore:

"Gore has spun a fortune from constantly reinventing the polymer polytetrafluoroethylene. In its 50th-anniversary year, the $2 billion-plus private company is on pace for record revenues and profits, thanks to a number of clever new products with a lot of potential."


An article in Sales and Marketing Management noted that employee teams help to hire new staff members, assist in determining each other's pay, and pick their own leaders. Crazy eh? But note the same article says this:

"An almost eerie optimism radiates through the hallways at Gore, which is best known for its Gore-Tex lining for weatherproof jackets, and which remains a private company despite its size, in order to protect its culture from outside interests."


Ouch! Here's a company that exemplifies a governance model of innovation, encourages employee innovation and distributed market intelligence. And it has to stay private to protect this culture?

My sense is that the Enterprise 2.0 movement in general is a vanguard toward improving the way companies are managed. Being a public company, used to a top-down order of things and paying a lot of money to outside consultants to understand the market, is hard to change overnight. But companies can begin to improve the way they engage their employees and leverage their vast, distributed know-how and creativity. There is a wide spectrum of how far companies can take this. The key is to begin understanding how new approaches can work in your organization.

Enterprise 2.0 as a movement, not a technology, is quite promising for enabling companies to improve their overall strategies and operations.

Alternatively, we can continue to do things the way we always have, with a limited set of decision-makers and market intelligence gatherers. As seen with the increased rate of companies gaining and losing positions in industries, this model is becoming less reliable.

Remember, there's a reason democracies don't suffer famines.

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Hutch Carpenter is the Director of Marketing at Spigit. Spigit integrates social collaboration tools into a SaaS enterprise idea management platform used by global Fortune 2000 firms to drive innovation.