The true cost and savings of Enterprise 2.0
Buying an Enterprise 2.0 platform is pretty cheap. There are not much complexity in the software or hardware requirements unless the purchasing organisation decides to modify and change things around extensively. Even that, its still not as complex as an Oracle / SAP type enterprise implementation. However, being cheap and easily installed, many people forget the soft costs involved in the implementation.
Enterprise 2.0 is about social networking, collaboration and innovation. Whether it is a bottom up or top down driven implementation, alot of time is required to educate, excite and experience the true benefits of it. Champions have to spend time to educate people and change people’s working mindset and habits. Alot of preaching of the goodness is required too.
So even though an organisation might be paying small amounts of money per user, the amount time time employees spend to push this out into the wider organisation could be quite substantial. This is the communication cost required to get it running. How much would it cost your organisation?
Another thing organisations need to look at is an analysis of the transaction cost and how much savings can an organisation make out of it. I will not go into the theory and concept of transaction costs but there are means to calculate and analyse it even before deciding to take a step into the Enterprise 2.0 platform.
There is never a one size fits all model. Enterprise 2.0 will work for some and not for others. What is discussed above is specifically from the financial perspective only as well. There are many other factors that needs to be considered.
Mike said,
Good Article.
The question is whether Enterprise 2.0 can fit within the standard project evaluation model used by corporations in decision making. Ultimately if the project do not translate into dollar values to the shareholder (cost savings or increased sales revenues in the form of future cash flows), it may not be in the firm’s interest to pursue further.
Should a new project evaluation framework be created for projects that returns soft (intangible) benefits ? How measurable are they ? Does Enterprise 2.0’s uniqueness deserve a separate model on its own ?
Sean Lew said,
Haha! Mate this is what I am doing for my thesis.. Will tell you the answer in a few years.
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