A couple of weeks back, my colleague and Enterprise 2.0 guru-in-residence over at ZDNet, Dion Hinchliffe, published an interesting analysis of the return on investment on Enterprise 2.0.

Lately, my own pet subject, service oriented architecture, has been getting raked over the coals over the matter of ROI, but Enterprise 2.0 — because it’s so new and fresh and there is little cost for the tools and services — has been getting a pass.

However, caution still reigns, and Dion observes that “there is still mostly a wait-and-see attitude amongst IT managers and business leaders at the moment.” Dion says many E2.0 solutions overlap with already existing solutions, hierarchical corporate culture gets in the way, and then there’s the nagging question of ROI.

As an emergent set of technologies and methodologies, a solid, predictable ROI cannot be quickly pinned down for E2.0. However, Dion is confident that the collaboration it enables is clearly of great business value:

“I would like to make it clear that there is little doubt that Enterprise 2.0 delivers ROI today, at least on the collaborative side (the jury still seems to be out on the social networking side). Recently, researchers have even been able to put a real numerical value on social connections. My point is just that it’s difficult to determine where the returns (often the most important ones) will appear when the tools have so many downstream effects. That’s not to say either that Enterprise 2.0 ecosystems can’t be directed to some degree to achieve business objectives. In fact, I believe the the next generation of workers will be experts at achieving their goals by eliciting and then harvesting the knowledge and capabilities they need over the network.”

Not so confident about E2.0’s ability to deliver business results is my other ZDNet colleague, Dennis Howlett, guru-in-residence of all things enterprise.

Dennis published a rebuttal to Dion’s post, arguing that there aren’t enough examples out there yet of E2.0 delivering results. And, he adds, the bean-counters and the corner-office folks are in no mood these days for funky new theories and applications:

“… the most serious problem with the analysis is its reliance on
‘jam tomorrow’ as an inducement to feed the trend. It is all very well saying that something is emergent but that cuts little ice in the C-suite where the current focus is on cost reduction – usually of the order of 20%.”

Plus, enterprise collaboration is a dream that’s been chased for decades now, Dennis adds. “Getting a department on board, let alone an enterprise, can be  mind numbing, thankless task. I spend most of my life in the ‘knowledge’ industries but even there it can be like pulling hen’s teeth.”

And how do you measure the ROI? “Where’s the ROI in email? Unlike others, I believe that IS measurable,” Dennis adds. “You can’t quite say the same for blogs except in retrospect.”

As I noted in a previous post here at the FastForward blogsite, Gartner’s Mark McDonald said E2.0/Web 2.0 tools may have a lower bar for ROI because they’re so inexpensive to adopt and use. Is this bar low enough to escape the scrutiny and expectations for other technology solutions to deliver more than their initial costs in measurable results?

And — this is a matter that needs to be explored in more depth.

A couple of years ago, I talked about the difference between the E2.0 style of management versus the traditional style. That is, productivity in an E2.0 culture comes in “bursts,” versus the show-your-face-between-9-and-5 mentality. Bursty productivity calls for a different set of measurements of value to the business, versus the time clock.

So the question lingers — how do you appropriately measure E2.0 ROI? In the SOA world, it’s been established that baseline metrics need to be established at the start of a project, tied into key performance indicators (KPIs) for the business. IBM even talks about “Key Agility Indicators” as a way to track the impact of projects on business progress. Is it time to get serious about Enterprise 2.0 metrics?