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Web 2.0 technologies like Wikis are so radically different that traditional organizations are not structured to take advantage of these emerging technologies. In my view there are 3 main reasons why Web 2.0 will have difficulty penetrating traditional corporate world.

Flow of Ideas

In a traditional organizations, ideas flow in unidirectional fashion. It’s the management that decides on a business strategy and motivates their employees to implement or work towards that strategy. Information flow is also controlled by the management. Conventional corporate wisdom says that employees do not need to understand all the complexities behind running the business. It’s revealed on a ‘need to know’ basis.

In Web 2.0 world, ideas do not follow any rigid preset direction. The information freely flows and that in turn generates relevant and big ideas. Any individual with a great idea can galvanize and create an ecosystem as well as momentum around that idea.

Power Structure

In the traditional organization, the power structure is vertical and top down. The manager can influence how and what the employees can work on. Hierarchy is mainly predisposed. Top executives are supposed to be smarter than middle management. Middle management is supposed to be smarter than individual contributors. This hierarchal power structure gives management a sense of direction as to where to take their organization.

In Web 2.0 world the power structure is horizontal. The person with the greatest idea can influence how and what to work on. Community of resources agreeing with that person, will come together to organize themselves to execute the idea. Also, there is no concept of hierarchy in the Web 2.0 world. In fact, this lack of hierarchy makes it all that powerful.

Employee Incentives

In the traditional organization, the employee who is smarter or better gets promoted. That generates an environment of competition between the employees. This pyramid structure in the organization leads to vicious politics. Power and Control are the only ways the employer can reward an employee.

Web 2.0 technology triggers people to collaborate rather than compete. The best ideas come as multiple people come together to co-operate and add value. Instant international recognition is what motivates individuals in Web 2.0 culture.

These three diametrically opposite forces between traditional organizations and Web 2.0 technology is the main reason, why a traditional organizations will struggle to use it successfully. Today’s organizations have to radically restructure to fully leverage Web 2.0 technologies.

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In the eWeek.com article IT Workers Second-Guess Career Choice, Deborah Perelman reports a disturbing trend where the IT workers in the US see a bleak future for their career and are discouraging their kids to not pursue IT career. 

Outsourcing, Offshoring, H1B Employees, Commoditization of IT work force are all here to stay, but they are all signs of a dynamic IT industry. Granted older software development skills become less relevant in a hurry. But, is this a new occurrence? Much sought after experts in VB and ASP in late 1990s are now a relic. The employees have always understood that they need to retrain themselves in new emerging technologies constantly.  That’s the occupational hazard in IT Industry. Now, what has changed is the nature of new skills that are relevant. ‘Soft’ skills are becoming more important.  

Businesses are no longer interested in making sure that the tactical aspect of IT is running smoothly. They don’t want to know if their IT infrastructure scales, if their data is secure. They expect it to happen anyway, just as you expect the lights to go on when you flip on the switch. That’s where the IT is getting “commoditized”. If your skill set is in those areas, you need to get out fast. But, increased globalization has made corporations more vulnerable to competition. The impetus to change and look for the new markets quickly is of highest priority now. Thus, I believe IT now is more relevant to the corporations than before. When organizations talk of ‘agility’, it’s the IT organization that can enable the corporations to be agile. How can you be agile when you do not have ways to make your business processes agile? Throwing the IT project over to the IT department and expect it to meet the business needs is no longer viable today. At the same time IT department cannot go into seclusion and work on a project for few months at a given time. The hypercompetitive environment will make your IT project irrelevant during that time. IT workers now need to collaborate with the other business organizations. This new reality calls for new generation of IT workers. The ‘soft’ skills that are more relevant now are -

1. Comprehend Company’s Business Strategy
2. Understand how the company differentiates its products or services vis-à-vis competition
3. Articulate technical jargon to non IT business people
4. Understand TCO (Total Cost of Ownership) and ROI of a project
5. Ability to negotiate and influence others

I know these new skills can be intimidating to a ‘techie’. The above mentioned skill sets do not limit itself to IT personnel but need to be expanded in other Knowledge Industries like product engineering, R/D etc. Most of us are uncomfortable to collaborate, communicate, influence and negotiate and hence we choose safer ‘engineering’ jobs. ‘We can just do our jobs and go home… Who wants to get involved in company politics…’ that’s the conventional wisdom in the ‘techie’ world. Guess what… we are now in the middle of corporate universe and we need to be like ‘them’.

I believe, now is the exciting time for knowledge workers. We can influence the Business Strategy and be relevant to the core of the organization. What other job function would be that exciting? It’s a self fulfilling prophecy when we send out wrong messages to the younger generation to stay away from these fields. America will surely loose competitive edge with this kind of attitude.

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Information Week article “Younger Workers Demanding Web 2.0 Tech on the Job” talks about how Web 2.0 has become important part of social life for the new generation workers.

Our company has its own internal blogging and its interesting to see that the young hires and interns start blogging almost instantaneously. In some cases, I see them blog on their first day at work as soon as they get their own laptop. In fact, one hire started writing how boring the orientation training was - during new employee orientation!

It’s an interesting balancing act for organizations to provide infrastructure for blogging, social networking etc. and at the same time make sure that employees use it to improve productivity.How do you calculate the ROI of Web 2.0 at work? Will organizations be able to monitor privacy and security of information? How do you treat Intellectual Property (IP) of the organizations? These are some of the issues the company’s executives need to start addressing soon.

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Valuable survey by McKinsey titled “The next frontier in IT Strategy“. Senior IT executives now believe that they are successfully aligning IT strategy with the needs of businesses they serve. Finally, IT executives are collaborating with business organizations to identify ways to make IT add business value. It’s a sign that displays IT departments are moving away from tactical IT infrastructure management. Though IT infrastructure is important, from business organization’s perspective, infrastructure management itself is a cost overhead. With that mind set, there is always a pressure to drive down IT costs. Only when IT plays an important role in enabling business strategy, it will have a greater chance of getting better funding. IT department can also ascertain gravitas in the boardroom in getting the right resources for innovations.

IT can and must play an important role in aligning with the organization’s business strategy for it to be relevant. I am beginning to believe that tactical Infrastructure Management can be outsourced or a third party SaaS (Software as a Service) delivery model can be used. This will free up internal IT department to work on projects and applications that will create and sustain competitive advantage for their company. Ironically, trend makers in this case are SME organizations.

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