By 2014, social networking services will replace e-mail as the primary vehicle for interpersonal communications for 20 percent of business users.

Greater availability of social networking services both inside and outside the firewall, coupled with changing demographics and work styles will lead 20 percent of users to make a social network the hub of their business communications.

Not sure: it will depends of the specific business context of every organization. Sure, teens are using more heavily texts and messaging functions in social networks over email, but keep in mind they’re not inside an organization yet. The business realities can make emails really attractive as a tool: offline use and accessibility in low-connectivity areas are examples of email strengths in some industries. So, 20 percent is too high for employees of large organizations.

During the next several years, most companies will be building out internal social networks and/or allowing business use of personal social network accounts.

To allow, officially and formally, business use of personal social networks accounts is still a long shot, as it will depend on the platforms themselves investing into compliance capabilities. Unlikely in my opinion.

Social networking will prove to be more effective than e-mail for certain business activities such as status updates and expertise location.

“The rigid distinction between e-mail and social networks will erode. E-mail will take on many social attributes, such as contact brokering while social networks will develop richer e-mail capabilities,” said Matt Cain, research vice president at Gartner. “While e-mail is already almost fully penetrated in the corporate space, we expect to see steep growth rates for sales of premises– and cloud-based social networking services. “

No news here.

Gartner recommends that organizations develop a long-term strategy for provisioning and consuming a rich set of collaboration and social software services, and develop policies governing the use of consumer services for business purposes. Companies should also solicit input from the business community on what collaboration tools would be most helpful.

How is this not obvious? ;)

By 2012, over 50 percent of enterprises will use activity streams that include microblogging, but stand-alone enterprise microblogging will have less than 5 percent penetration.

The huge popularity of the consumer-microblogging service Twitter, has led many organizations to look for an “enterprise Twitter,” that provides microblogging functionality with more control and security features to support internal use between employees. Enterprise users want to use microblogging for many of the same reasons that consumers do to share quick insights, to keep up with what colleagues are doing, to get quick answers to questions and so on.

“However, it will be very difficult for microblogging as a stand-alone function to achieve widespread adoption within the enterprise. Twitter’s scale is one of the reasons for its popularity,” said Jeffrey Mann, research vice president for Gartner. “When limited to a single enterprise, that same scale is unachievable, reducing the number of users who will find it valuable. Mainstream enterprises are unlikely to adopt standalone, single-purpose microblogging products.

Seriously disappointed by Gartner here, although there is no question activity streams will be used by even more than 50 percent of enterprises (more like 80% for me).

First, while having a hub that aggregates activities across all applications, social or not, will be a must, actually integrating all capabilities into one tool may not be the best way for the majority of organizations to increase the signal to noise ratio for their knowledge workers. In other words, keeping micromessaging (much better name than “microblogging”, which is misleading) as a separate application, with its UI, clients, etc. may be the most effective deployment at the user level — though not being sexy for analysts or some IT folks, but who really cares if they are not happy?

Second, Gartner seems to be making the same mistake as most top execs when considering an application like microblogging: though its deployment will surely be global, with one infrastructure open to all employees (like email), its use and value will be extremely localized and formalized in business workflows.

Think of micromessaging as, purely, a communication infrastructure that:

• is real-time while being useful when accessed asynchronously
• can be tapped through web access, desktop client, mobile client, SMS
• allows specific group uses with security features (must-have for all respecting “Twitter for the enterprise” applications)

You won’t get a big platform where everyone converse with everyone like the actual Twitter platform. You will get a platform where everyone can converse with colleagues and groups based on business realities. Some groups will be very big, producing a behavior similar to Twitter (for example groups based on communities of practice with several thousands members), but most will be small, with a life based on the duration of a project or task, and between all the players involved (from 3–4 to 20–30).

For corporate social networking platforms: deployment is global, but use and value are localized.



Through 2012, over 70 percent of IT-dominated social media initiatives will fail.

When it comes to collaboration, IT organizations are accustomed to providing a technology platform (such as, e-mail, IM, Web conferencing) rather than delivering a social solution that targets specific business value.

Through 2013, IT organizations will struggle with shifting from providing a platform to delivering a solution. This will result in over a 70 percent failure rate in IT-driven social media initiatives. Fifty percent of business-led social media initiatives will succeed, versus 20 percent of IT-driven initiatives.

Enterprises will need to develop entirely new skill sets around designing and delivering social media solutions. Until this happens, failure rates will remain high. A dearth of methods, technologies and tools will impede the design and delivery of social media solutions in the near term. But long term, enterprises will realize that social media is not a “hit or miss” activity naturally prone to high failure rates, and that a calculated approach to social media solution delivery must be an IT competency. At that point, post 2012, the social software market growth will accelerate as will the overall impact of social media on business and society.

Pretty much agree here. The skills needed in IT: internal management consulting based on strong knowledge of both the new workflows enabled by innovative technologies, and deep knowledge of the enterprise’s business context. Those internal consulting group should sit outside of both IT and the business, justify their value by measured improvement in business KPIs and have direct executive access and support. They could rely on external consultants to assist as needed, but manage every engagement.



Within five years, 70 percent of collaboration and communications applications designed on PCs will be modeled after user experience lessons from smartphone collaboration applications.

As we move toward three billion phones in the world serving the main purpose of providing communications and collaboration anytime anywhere, Gartner expects more end users to spend significant time experiencing the collaborative tools on these devices. For some of the world, these will be the first or the only applications they use. The experience with these tools for all who use them will enable the user to handle far more conversations within a given amount of time than their PCs simply because they are easier to use. Just as the iPhone impacted user interface design on the desktop, the lessons in the mobile phone collaboration space will dramatically affect PC applications, many of which are derivatives of decades-old platforms based on the PBX or other older collaboration paradigm.

“IT organizations should continue to procure leading-edge smartphones for testing and to accumulate knowledge on how the collaboration applications on such devices accomplish business tasks,” said Ken Dulaney, vice president and distinguished analyst at Gartner. “As more organizations consider replacing deskphones with cell phones, they may wish to anchor their collaboration tools also on the cell phone.”

Agree but weak: in 5 years, the hardware options available for mobile computing will be far better than what we call smartphone today. Real valid comparison here is versus consumer web/mobile applications, that’s what will provide (much needed) inspiration for the design of enterprise applications.



Through 2015, only 25 percent of enterprises will routinely utilize social network analysis to improve performance and productivity.



Social network analysis is a useful methodology for examining the interaction patterns and information flows that occur among the people and groups in an organization, as well as among business partners and customers. However, when surveys are used for data collection, users may be reluctant to provide accurate responses. When automated tools perform the analysis, users may resent knowing that software is analyzing their behavior. For these reasons, social network analysis will remain an untapped source of insight in most organizations.

Before undertaking a social network analysis, Gartner recommends that the organization ensure that it has the trust and buy-in of the people it hopes to include in the analysis in advance. Issues of privacy and confidentiality must be addressed and a determination needs to be made regarding how the information will be used and communicated. Establishing the ground rules upfront will encourage more open and honest participation and reduce the resistance to ongoing relationship monitoring.

Same old argument here: surveys will be lied to, and automatic collection of interactions need to be exhaustive across all channels to be useful (yes, even phone calls (and conf calls with that!) would need to be logged and analyzed, or you miss a good chunk of interactions). I’ve not yet seen a SNA application or solution that could work across 100% of even generic channels, not even speaking of in-house applications that could be the main interaction firehoses internally.

SNA is a good sell for analyst firms and consultants, because it is sexy and has a few good examples that are used as demonstrators, but in practice the tools are not there yet to collect the data needed (the analysis is easy).

The event promises to be fruitful. If you want to connect while in Francfort, by all means get in touch. I’m also trying to organize some kind of a pre-session in Paris. More info here soon.

Title: Enterprise 2.0 Summit
Location: Frankfurt, Germany
Link out: Click here
Description:
How-to Leverage the Power of Feedback and the Law of Participation

Participation as a means of gathering feedback from all parts of the organisation is a key element of Enterprise 2.0 projects. This panel focuses on how to best achieve this. Experts and practitioners discuss project structuring and feedback mechanisms, plus the pitfalls to avoid.
Speaker:
Julien Le Nestour, IT Innovation Manager, Schlumberger
Moderator:
Lee Bryant, Founder and Director, Headshift Ltd.
Start Date: 2009-11-10
End Date: 2009-11-12

UPDATE: This is the deck used:

Safaricom is revolutionizing what currency means in Kenya with M-PESA. A true, radical innovator, in an industry characterized by many fossilized players in developed countries. Will I ever see an “Enterprise 2.0″ case study on Safaricom? Yes, if they deploy a wiki, social networking platform, etc. Otherwise, no. How crazy is that? Their combination of IT tools, culture, organizational design, etc. achieves radical innovation. Yet, this combination is of no interest for the wider E2.0 community (at least not that I know of). Why? Because they don’t use, in a disclosed way, tools labelled “2.0″.

Enterprise 2.0 is fundamentally defined with the tools used, but decorrelated from performance. It’s time to recenter it.

Ask any one in the so-called “Entreprise 2.0″ sphere what is an E2.0 case study, and you’ll get this: how organization A implements technology B. Even if it’s GM implementing wikis (honestly, WTF?). Well, the case studies I would like to see are more like this: what new/E2.0 technologies, blended with which organizational design, are used by radical innovators like Safaricom, who is redefining currency in Kenya? And if the answer is nothing, or at least nothing explicitly labelled 2.0, you’ve found yourself a very interesting questioning path.

Moreover, implementing all the E2.0 tools in the world won’t save obsolete organizations There are 2 major ways in which E2.0 implementations could meaningfully change the destiny of obsolete organizations:

1. revolutionize, hence boost, their organizational performance at a high-enough level that they change the playing-filed in terms of productivity (GM producing the same cars at 1/3 of the costs, while not awesome, would surely save it)
2. they do not affect their vision significantly enough, steering the organization towards awesome goals, and away from its industrial-era objectives

Sadly, E2.0 applications alone haven’t demonstrated these effects, mostly because all the pieces of the puzzle have to evolve to set any real change in motion.

So how should we focus our research efforts? The intersection path between new technologies and new organizational forms is still the focal point, but it must be approached from two different angles.

The new organizational possibilities opened up by new technologies. Going from the new technologies to organizational performance is still fundamental. We need to look at the current tools available, the future one, and think about new, more efficient organizational forms. These forms would improve coordination and efficiency, through the use of the latest technologies. At a high level, this is what happened when technology made it possible to transmit reliably information in India about, say, your tax returns, and have them processed there. New organizational forms appeared to take advantage of these new technologies. So, this is one way in the interaction, what usually lack is the other.

What IT tools excellent organizations would benefit from? This is taking the other side of the lens and asking: we have organizations that are performing at an amazing level; let’s understand these mechanisms, and maybe see what IT applications, existing or possible to design, would further enhance their performance. For a definition of excellent, Umair’s Awesomeness concept is a very good starting point. Whether those tools are E2.0 labelled tools, or not, nobody shoud care less.

The real nucleus of “Enterprise 2.0″ is, or should be, wholesome organizational performance (or awesomeness, call it what you want). Not just about implementations of tools labelled E2.0. The continued focus on the tools only serve to discredit the “sphere”.

Photo credit: gunnarcamner

As a simple example, when I want to illustrate the need to seek diversity in order to create innovation, I’m usually putting an image such as the following when talking. It makes diversity much more concrete and rememberable.

With so many people spending time to find the best pics, the idea is simple: share them. I have started to tweet the one I’m finding with the link, the tags I would put for them, and the hashtag #prezpic. So please, try to do the same when researching pictures for presentations, it will take you an added 10 secs per picture, and could make a huge difference in the quality of illustrations. I’ve started by sharing some of mine, do a twitter search on #prezpic to see them.

And if you wonder why putting images in your presentations is so effective, then start by reading these 3 blogs and following their advice :)

• Presentation Zen
• Slides that Stick
• Nancy Duarte’s blog

PS: If this gains traction, the best way to collect links will probably be to subscribe to the RSS feed for the search :)

Photo credit: Flick user oberazzi

The release of the Shift Index from the Deloitte Center for the Edge is an excellent occasion to come back on the foundations of the various Shifts that are currently redefining the way businesses have to operate.

The core digital infrastructure technologies (Computing, Storage, Networking) are showing an exponential increase of their cost/performance ratio, and there are no signs of stabilization. This exponential and continuous improvement in performance directly enables almost all the other shifts, most notably the accelerating pace of change. What is crucial however, is both the sheer scale of improvement and a pace which shows no sign of stabilizing in the near future, contrary to past groundbreaking infrastructures:

The exponentially advancing price/performance capability of computing, storage, and bandwidth is contributing to an adoption rate for the digital infrastructure that is two to five times faster than previous infrastructures, such as electricity and telephone networks.¹

The Foundation Index

The team has defined a Foundation Index that “quantifies the first wave of the Big Shift, which involves the fast-moving, relentless evolution of a new digital infrastructure and shifts in global public policy that have reduced barriers to entry and movement.“²

It is encompassing more than just the core technologies, but these are clearly one of the key driver of the index³:

If we now have a look at the 3 technologies that make up the “Technology Performance” index, the price/performance increase is drastic, and according to the report, shows no sign of stabilizing in the near future.

Computing

Over time, the Shift Index will look for changes in computing performance or cost curves. That said, we expect this metric to be highly predictable. While the history of technology is rife with predictions that turned out to be wrong, the ability of human intelligence to constantly extend Moore’s Law into a relevant future has persisted. Regarding the extensibility of Moore’s Law, Moore said, “One of the principle ways we achieve this is by making things smaller and we’re approaching the limit that materials are made of atoms. We’re not too far away from that. But talking to the Intel technologists, they think they can still see reasonably clearly for the next four generations. That’s further than I’ve ever been able to see. It’s amazing how creative the people have been about getting around the apparent barriers that are going to limit the rate at which the technology can expand.” Beau Vrolyk, former executive at SGI and current Silicon Valley investor with deep expertise in digital systems agrees: “As device physics approaches a limit to Moore’s Law, architecture innovations like multi-core and parallelism have allowed the industry to continue to provide signi icant advances in price/performance that resemble Gordon’s projections.” We can assume that the cost performance of computing will continue to decline at its current trajectory for the foreseeable future and to add to the forces underlying the Big Shift.⁴

Digital Storage

During the past 16 years, the cost of one gigabyte (GB) of storage has been decreasing at an exponential rate from $569 in 1992 to $0.13 in 2008, as shown in Exhibit 16. To put this into perspective, Sukhinder Singh Cassidy, Google’s vice president of Asia-Paci ic and Latin America operations, observes, “Since 1982, the price of storage has dropped by a factor of 3.6 million … to put that in context, if gas prices fell by the same amount, today, a gallon of gas would take you around the earth 2,200 times.”12 During this time, the compounding effects of technology innovation, competitive pressures, market demand, and the substitute effect (storage as utility) drove costs down dramatically while contributing to exponential increases in performance.

Will performance continue? There is no consensus on how long IT technology innovation in storage will continue at its current pace. Yet insatiable market demand and constant advances and new innovations coming from a raft of new technologies including nanotechnology, 3D holographic storage, carbon nanotubes, and heat-assisted magnetic recording13 suggest that the decrease in storage cost/ performance will continue for the foreseeable future.⁵

Bandwidth

Corning optical fiber scientists conclude that due to the decrease in bandwidth cost/performance ratio, iber network “traffic is going up by 2.5X every two years and capacity is going up by 1.6X and this trend is likely to continue on this trajectory for the foreseeable future.”15 This assessment implies that bandwidth cost/performance trends are also likely to continue in the future.⁶

As the name of this index suggest, the pace of improvement for these 3 technologies provide the foundations for the shifts redefining the way businesses (and any other organizations) have to behave and compete. I will reference this post in future analysis, but won’t expand here: I could not provide a better overview than the excellent report itself.

References

1. The Shift Index, Deloitte Center for the Edge, John Hagel, John Seely Brown, Lang Davison
2. The Shift Index, p. 20
3. The Shift Index, p. 22
4. The Shift Index, p. 25
5. The Shift Index, pp. 27–28
6. The Shift Index, p. 30

This will be a short and to the point post. I have sought to explain how this blog is (kind of) organized (see here). In the process, I have changed a bit the organization, and have now to comply with it :) So let me do a few posts that need to be there while not really bringing new content, for the majority that is.

One of the fundamental shifts brought by the emergence of the Internet as a common tool used by individuals is that the costs of interaction has fallen to zero. Umair Haque is one of the best references in this domain, and characterizes this new context as a world of “cheap, ubiquitous interactions”, or said otherwise a “hyperconnected” world.

At first through virtual rudimentary Bulletin-Boards, the Internet has enabled increasingly efficient, cheap and deep interactions. What started through mailing-lists or on ICQ, continued on forums, and evolved into tools like Facebook, Dopplr, and an infinite variety of means for individuals to find, connect, and interact with other individuals on nearly every possible topics or collective endeavors.

Of course, such a radical shift had many consequences. They range from radical transparency to the decay of brands. You may think that this shift has occurred a long-time ago and has now being incorporated in every domain: strategy, marketing, etc. You would be right for the first point, but unfortunately quite wrong on the second. We’ll delve into this in subsequent posts.

An obvious illustration would be how industrial-era organizations are seizing on these existing technological capabilities to improve their internal efficiency. Most aren’t, and the unrealized potential is simply mind-blowing. What is needed is a complete rethinking of organizations as institutions, with all dimensions redefined to take into account these shifts.

Umair has been banging on all of this brilliantly for several years now, if you are interested in this topic (and I would argue that you should), he’s now blogging at Harvard Business Publishing.

The rising scarcity of attention makes the concept of “features” increasingly irrelevant. IT and Business Executives need to unlearn using this concept as an evaluation tool for IT applications. If vendors want to increase their market share, they also need to make sure “features” is not the focal point of their sales pitch.

Initially, we identified a fundamental “Macro” Principle: attention scarcity is deeply reshaping businesses. To be actionable, this fundamental principle was translated into a strategic one: the use of Return on Attention (ROA) as a key metric within organizations. I am now looking at the application of this strategic principle to Enterprise IT, one of the critical areas that need to apply ROA much more rigorously.

Return on Attention as a metric to evaluate IT Projects

This metric needs to be used across all activities, but it’s nowhere as important as in evaluating the performance of current and future IT applications.

An IT application is indeed mainly consuming attention for its users. Information Technologies are also the domain where the opportunities to drastically improve ROA are the most prevalent. Depending on the application, you can achieve the same activity while consuming very different amounts of your attention. The variance is huge. Still, an IT system is generally viewed as a set of features.

How do you decide if a product is good? How do you choose between two different but relatively similar offerings? Too often, the main criteria is the functionalities provided. A Learning Management System can integrate and manage so many courses, use x types of media; an infrastructure can provide mobile email functionalities or not; a blog platform can embed x types of media, implement trackbacks or not, etc.

Unfortunately, features capture only a tiny fraction of the value provided to end users. In order to capture the full experience, you need to take into account:

• the usability performance: what are the results of usability tests?
• mix of features: not too simple, avoid feature creep. Ultimately, this needs to fit with the culture and workflows in place.
• adaptation of existing and new workflows and processes (this can be mandated by the tool itself of course).
• the “sexyness” of the user interface (benchmark is the consumer market): will your employees enjoy using the software? If not, unless they have to, they won’t use it.
• the training needs: most non-business specific applications should not need more than 20 mins of training for the new generation of employees.
• potential to develop increasing returns dynamics (via network effects for example).

All these criteria (and the list is not exhaustive) need to be combined to evaluate what will be (or what is) the value provided to your employees, and how much the application is improving their productivity. The aggregation of these criteria in a single concept can be thought of as “fluidity”, “flow”, but is best synthesized as the Return on Attention provided.

Examples

A simple example would be blogs in large companies. Provide them through SharePoint or Wordpress Mu, what you provide is still blogs. When evaluating the tools, the basic features of blogging will be identified in both applications—assume here that only the basic features provided by SharePoint are needed. In most organizations, the solutions will be seen as interchangeable, based on the feature set. Looking at usability though, and by merely using the two to create a few posts, you immediately realize that posting the same content in SharePoint will take at least twice the time (and probably twice the clicks) as posting in Wordpress. Managing the posts, reading them, and virtually all other tasks sports the same efficiency difference. And yet, the feature sets will be seen as identical. Do you think the ROA will be as well?

ROA needs to be used when comparing products 1 to 1, but it must also be used for all other strategic IT decisions. Not convinced? Let’s look at mobile email capabilities. The choices you make in terms of infrastructure design (as well as sourcing and other domains) will constrain your options in terms of mobile email deliveries. Your employees using Windows Mobile devices because of your MSFT infrastructure will know first-hand the loss of productivity compared to other devices, most notably the iPhone and Blackberries.

It is worth stopping shortly on this last example. How many IT executives are evaluating the potential platforms to be used by employees to manage email on the go? How many business executives are taking a strong stance and forcing their CIO to consider these issues? In my experience, close to none, the platforms available are just a consequences of other technical decisions. Yet, how valuable is it, for your company, that your employees can manage emails easily on the go? How much value is there by cutting in half (or doubling) the time it takes to write an email? Right, the value in terms of productivity is typically huge. The direct hit at your productivity will just be the consequence of focusing on features and ignoring the global Return on Attention you total infrastructure will end up providing your employees with.

Use ROA as an aggregated set of criteria

When comparing different offerings for the same project, or when optimizing your applications portfolio, ROA is a metric that aggregates all the single trade-offs each application incorporates. You should compare products, or even projects based on ROA. You can use a multifaceted list of criteria to evaluate individually, then create a weighted average. Criteria are split between the properties of the application itself and how these properties weave together with your corporate fabric. ROA can indeed be evaluated only with regard to the specific activities and actors the application is supposed to enable. A generic checklist can be established, but it will need to be adapted to each business process.

An ROA checklist contains items such as:

• how much training does the application require? Is it intuitive enough to skip a training phase altogether?
• is there increasing returns dynamics embedded in the design? If so, what is their level?
• how many clicks are required for all core tasks?
• how much loading time is there for all core tasks?
• are RSS feeds originating for core items? all items? no feeds at all?
• how does the application work on mobile access?
• how does it improve current workflows? how does it make new, more efficient workflows possible?
• what are the standards used? are they open? will they be easy to work with to spread data and notifications?

My last point is interesting in itself: considering the standards, it actually evaluates the ROA, not only through the end-users, but primarily through the IT function. A product with open standards will increase the ROA the end-users get from it through increasing the ROA reaped by the IT function with selecting this product. It’s not the point of this post, but remember that ROA needs to be evaluated for all actors in a system.

You have to build a complete list and adapt it to both your organization and the project evaluated. If you use poorly usable, not sexy, slow enterprise software but the manual workflows targeted are, as a result of the project, automated, no matter how poor the other criteria rates, the improvements at the workflow level will result in a very high ROA. But evaluating in terms of ROA can make you consider alternatives that you would not have evaluated.

How to put ROA into action?

The first take-away is the realization that ROA is actually what softwares compete on, and that the variance is huge. If you look at the consumer web market, all websites have to compete to provide the highest ROA for their users. The highest ROA provided selects the market leader in an area. In fact, the more you move towards the consumer web patterns of design, the more your application is likely to provide a high ROA. Brad Burnham, of Union Square Ventures, among others has characterized this very well:

The folks that built enterprise software were vaguely aware that their systems had to be accessible to the humans that used them but they had a huge advantage. The people who used them did so as part of their job, they were trained to use them and fired if they could not figure them out.

Today, no one tells you to use Facebook. There are no employer sponsored training sessions on the use of del.icio.us. The burden is on the designer of the system to meet a need, entertain, or inform their users. They also have to seduce those users, hiding complexity, revealing one layer at time, always enticing, never intimidating, until the user one day finds they are intimately familiar with power and the pleasures of the service.

It will happen in the same way within organizations. I have first-hand experience of teams not happy with SharePoint using Basecamp. The hazards of such situations are clear, but more rules or control won’t solve them, better ROA through corporate tools will.

How to use ROA for your organization? Here are a few leads:

When comparing alternative offerings, do spend 15 mins to understand the feature set, but stop after 15 mins and switch to actually using the product as an end-user and experiencing its usability level. Speaking to a sales person for more than 15 mins without experimenting with a demo is a waste of time. This is valid for IT and business executives. for your next sales pitch of 1h30, ask for a short presentation and demo after 15 mins. You will then focus on the right questions.

Make sure your partners within the organization have all completed at least one core task in each of the softwares considered. Make them do it within a meeting. Even with several products considered, you won’t spend more than 2 hours to do it. At the end of the meeting, you will have eliminated at least a third of them.

Favor applications that have their roots in the consumer market: they already provide a high ROA to consumers. While the criteria relative to their fit in your organization will need to be proofed, those related to their intrinsic performance will already be at good levels. Think about your recent 23 years old employees, and their first day in the company. They are either forced to use Outlook, which they likely never heard of before, or Gmail (through Google Apps for enterprise), which they likely use at home. WHich application will provide them with a higher ROA?

Incorporate ROA in your processes: make ROA a section on your risk identification checklist, include it in reviews, etc. Build a master template that needs to be used, with criterion adapted to your organization, and require minimum scores.

Consider the end to end user experience, and focus on the areas with the most risks for ROA, not for the technologies. Mobile email is an example of a project part with low technical risks but high ROA risks if not done well. If you are a business executive, insist on walking through the complete workflows considered with your IT counterparts.

How do you think today’s organizations handle the use of ROA as a metric? Do you see the advantages in using it?

Photo credit: Domibrez

“Nice content — awesome presentation! What did you use to make it?!”

That’s what everyone who sees my BRITE presentation asks me. It’s a new service called Prezi. And it’s insanely great — the minute I saw it I had to have it, no questions asked. So, for the first time in half a decade, I found myself doing the unthinkable: paying for software.

As Umair’s experience illustrates, Prezi is an amazing piece of technology. The Hungarian company has a great team, got a lot of press and recently set its sight on the US market. The service is obviously geared towards professionals: individuals or small companies, not consumers or large companies. I have embedded an example below (the embed feature is still in the works, so this is an example of no particular subject)

So how could Prezi best enter the Enterprise market? I don’t have the time to do a full strategy analysis, but here are the key points I would explore more deeply for such an expansion:

Provide an on-premise appliance ready for the enterprise context

Situation: Large companies are paranoid about their data being hosted outside of their network. The more valuable the data, the more paranoid they are. Presentations often contain the most sensitive data of a company, apart from its financial details: strategy roadmap, product pipelines, etc. Providing a SAAS version will be costly due to strict audits and certifications required (ex: SAS 70 Type II for data center).

Path forward: Provide enterprises with a non-customizable appliance that is deployed on their network and upgraded by Prezi at the same time the SAAS version is upgraded. Customers have no control on the software, similar situation as in the SAAS version. Only change is control on data location. This solves the cost issues associated with on-premise deployments. Appliances can be hardware or virtual machines. Only requirement is to provide built-in support for authentication through LDAP/AD and easy implementation of SSO. More details in this post.

Deploy appliance at cost, charge per activity

Situation: Prezi is a disruptive product that do not fit any existing box in this market. If approached in a classic way, the enterprise market will require long sales cycles, very progressive entry and a host of unnecessary difficulties. While competitors will use this time to imitate the product.

Path forward: As I detailed here, the best strategy is to offer a deployment at cost (this also works for a SAAS version at very low cost). Charge for the hardware and time spent, but nothing more. Then charge per activity or per active user. Also provide the first trials for free: either the first month completely free or the first XXX prezis completely free (to be adapted based on the size of the client of course). This would lower the cost for IT functions, eliminate the risks, and be scalable on Prezi’s side as you do charge at cost for the initial deployment.

Position as a visualization tool, not as a PowerPoint killer

Situation: Prezi cannot replace PowerPoint (or Keynote), as there is no way to produce complex enough graphs, diagrams, tables in Prezi. Strategically, Prezi should not try to match these features, this would be impossible. Keep in mind most companies actually use add-ins to complement even PPT.

Path forward: Position Prezi as a visualization tool for material produced in other tools, not as an equivalent to these tools, so that no credibility is lost. If this market is entered head-on as a replacement for PowerPoint, reputation will be damaged.

Provide users with standard templates, less choice, to appease fears

Situation: Prezi’s capabilities are impressive, but can be daunting for corporate users who may be afraid of designing a bad visualization, and look not so great in front of their peers. The total freedom offered by the infinite canva and scales may in fact hindering the adoption of the tool.

Path forward: Provide “templates” based on logical units to allow the creation of Prezi by specifying the materials and the logical flow of the visualization. This would be similar to the LaTeX typesetting software which separates the structure and the formatting. The user could build an outline, with sections, subsections, and items. For each item, he would be able to select a material (video, graphic, etc.) or type in some text. Prezi then takes care of converting the outline to a visualization, based on the logical structure, and without requiring the user to select himself the visualization details.

Charge support separately to discriminate among segments

Transparent.

Bring professional services to a Prezi platform

Situation: Prezi has impressive capabilities, but is much more fitted for presentations to large audiences on a big screen than your casual 10 persons meeting in a small room. The executives in charge of large presentations, however, are not the one in charge of the content. The responsible would welcome assistance to design a Prezi surelly to wow the audience. The manager wanting to design herself a Prezi will also likely not have the time to do it. What they need is assistance, in an efficient and trusted manner.

Path forward: An axis of development would be to offer, through the Prezi platform, access to designers offering to turn existing content into a a Prezi. Value added features would be the obvious ratings, feedback, reviews on the service providers. It would also be a legal framework in place, with insurance, that all service providers are required to have in place. This would ensure confidentiality for clients. No cost for Prezi once framework in place, multiple monetization points.

Why SAAS is not the easiest way to the enterprise

It is common among start-ups to think that large companies should just use the SAAS version. This is a mistake though, as the security risks are complex. The Cloud Security Alliance has produced an excellent document, title Security Guidance, that will give an overview of the broad security aspects of cloud computing. The executive summary is enough to grasp the challenges at play.

So what do you think of Prezi? How do you think they should tackle the enterprise market? Should they even consider it?

Clubatcost’s founder is a well established entrepreneur who is managing Orchestra, a children clothing retailer. Pierre Mestre’s video on the homepage of Clubatcost is self-explanatory, but in French only. He describes the confusion of customers faced with regular discounts of –50%, –70% online and never knowing if they are having a deal or not. He also takes aim at the accumulation of mark-ups charged by intermediaries. His proposition is simple: he will use its existing manufacturers network—well established through Orchestra; and by hiring a team of 20+ stylists to create exclusive designs, he will offer customers all articles at cost. New sets of items are released weekly for a limited time (usually a few weeks).

To build trust, all the articles presented are accompanied by an itemized break-down of the cost to provide customers with the goods (screenshot below). A discount comparing to the usual price of the item in regular stores is indicated. To be able to buy at cost, you need to buy a yearly membership, with different packages. These fees are the sole revenue of the company. Last point: to avoid gaming of the system and having groups of people ordering through just one paying person, there are limits to the amount of articles you can purchase on a single membership. If you reach the limit, you just buy a new one and continue. Finally, a show-room has been opened in Paris, where you can try the articles, and the company seems to be planning one in some European capitals, but certainly nothing more.

This is the model in brief, and if you read French, you can see that they are aiming at a very high level of transparency.

What is remarkable here is the pricing model: the revenue made by the company is not increasing with each sale, their revenue is fixed per customer. If you buy 1 or 10 items (and staying within the limits of 1 membership), their revenue stays the same. That is a radical departure of the classic “the more you buy, the more we earn”.

The future of this company will be fascinating to watch. For one thing: Orchestra Group is listed on Euronext (link). With this move (and though the capital structure of this subsidiary is not all clear), it is evolving from a classic textile retailing model into a radical company challenging many dogmas. Do you think investors will correctly anticipate the fate of this new model?

To succeed, it will also have to create strong relationships with its customers and prospect base. How they will use social media and crowdsourcing in particular will be interesting. I am personnaly puzzled by the lack of any form of crowdsourcing, and would be interested in knowing why they have not used it (yet?). Recommendations based on past purchases is also an obvious feature they will most likely launch later, along with individual reviews on each article (trust building again).

Imagine Threadless selling at cost in exchange of a $120 yearly fee, and you’ll get an equivalent with Crowdsourcing. The revenue growth and horizon is dramatically different, but which model is providing the “thickest” value, in Umair’s terms?