During the workshop, we gradually got them to realise that they didn’t need to get it right all in one go.  With Enterprise 2.0, you can quickly start a wiki or a blog for a small department.  If it doesn’t work, you haven’t failed, you’ve learned how not to do it.  So you try again, until you get it right.  Then as usage grows, you can start to implement profiles so that people from different departments can find each other, again, learning as you go.

This is great for Enterprise 2.0 champions as you don’t have to convince management to sign off on a big project as you would for an SAP implementation.  Finance love it because it’s cheap, and if it doesn’t work you haven’t wasted much time or money.  When you want to eventually roll out corporately and get asked the pesky ROI question, you will have real world examples from within your own company as to what the payback is.

So with Enterprise 2.0, failure really is an option!

• jonmell.co.uk is registered via Pipex.  I have been using Custom Domain publishing with Blogger where the nameservers for jonmell.co.uk point to blogger.
• Bought a hosting service which supports Wordpress (I picked SiteGround)
• Changed the nameservers of jonmell.co.uk to point to SiteGround
• Change Blogger to publish to blogspot.jonmell.com
• After about 10 minutes jonmell.co.uk now points to empty Wordpress blog.
• Used the Wordpress import function to pull everything over from Blogger @ blogspot.jonmell.com
• Installed, activated, and ran Justin’s plugin to maintain Blogger permalinks 
• Changed my permalink structure to /%year%/%monthnum%/%postname%.html
• I then changed Blogger back to custom domains so that it didn’t show up as duplicate content, but the pictures and media etc. were still there

All in all took about an hour (main time consumer was waiting for nameserver change to take effect.  All Google search and links from other people’s blogs are working! (so far…!)

I was asking Ed about whether it was possible to quantify the value of his blog to IBM. The only number he could really put his finger on was that since he started blogging four years ago his business’s revenue has increased by 40%! However, this clearly is not the only factor, (not only are other Lotus executives blogging, but the product has undergone significant enhancements in that time period) it certainly corrolates.

Blogging obviously hasn’t hurt the Notes/Domino line, and the anecdotal evidence is that the Lotus community certainly appreciate Ed’s blog (go and look at the comments for proof).

Whether it is a cause or not, if it has corollated with a 40% revenue increase over four years – why wouldn’t you blog?

Part of the problem is that blogs, being tools, can be applied to multiple problems. So the ROI of ‘blogs’ is somewhat misleading. In the same way that wiki ROI studies get confused when they try to address the tool itself, they should instead address the problem the tool is trying to solve, and then do an ROI study on that problem. For example, a blog could:

• Show a different side to an organisation, or reinforce a current perception/image (eg Microsoft’s Channel 9 or GM’s Fastlane)
• Showcase expertise around an industry or subject matter (eg the English Cut)
• Generate an honest dialoge with customers (eg Ed Brill of IBM)
• Perform market research (Dell’s IdeaStorm)

So, when organisations come to address the ROI of a blog they should look at its purpose, and use their traditional methods. For example, if GM is trying to change its public image using a blog, the same ROI methods should be applied as if they were engaging a consultancy on a re-branding or re-launch exercise. If market research is key, then the ROI follows the same pattern of how we measure the ROI of focus groups today. I worked with one customer who wanted to use their corporate blog to increase their brand awareness. So their measure of success was to sample brand awareness using phone polling before and then a few months after launching their blog. The ROI calculation was done on their traditional brand managment ROI metrics (so it could be compared with previous exercises). The fact that we are using an IT tool to get to the same end result shouldn’t change how we measure ROI, it should (hopefully) help us end up with a better ROI result!

However, measuring return is not the only tricky part of measuring the ROI of a blog. The costs are pretty low in turns of financials, but the real cost is time. How many hours per week are you going to budget for blogging and how does this impact your ROI? It’s even more difficult as it is not a one-off cost, as would an IT project to automate business processes where you pay a lump some for software, hardware and services and watch the returns come in. Blogging requires a certain time commitment every week, or sometimes every day. You need to work out the opportunity cost of your bloggers spending time blogging (or, more accurately, spending time performing market research, talking to customers or showcasing their expertise) into your calculations.

Of course, all the above only address external blogs. What about organisations which provide employees with blogs within the firewall? Again, go back to the problem that blogs are trying to solve.

If your internal blogging platform is meant to be a searchable knowledge repository, how have you previously measured the value of employees having speedy access to information?
If it is for employee feedback, what was the ROI of previous feedback schemes? One that I think will become increasingly important is retention. How much does it cost it replace an employee and how much will lack of blogging facilities be a reason for leaving as a new generation with new expectations comes into the workforce?

Let’s try and put some numbers around this. Say we have a £20m turnover company with 100 employees. Let’s say they have an industry speicalist, their super-star consultant who is usually chargeable but equally is expected to help close deals, which I hope is a fairly typical scenario. Let’s say that he ‘gets’ blogging, is really keen, and spends four hours a week blogging. Assuming he charges at £150/hour that’s £600/week = ~£30k per year lost revenue (0.15% of turnover). So his blog, showcasing his expertise and therefore giving his organisation authority, has to pull in probably between 1-2 clients per year to break even. How do you measure this? Quite simply the same way as you measure any marketing tool, you ask your customers whether it had an impact on their decision!

However, there’s another way of looking at it. Blogging champions are funny people, the chances are that the consultant would blog out of hours, because they are so enthusiastic about what they do. Even if it is done during time which would be otherwise chargeable, the consultant would be expected to attened sales meetings to convince the client of the organisation’s delivery capability anyway. By blogging, he or she is doing this for an unlimited audience, as opposed to the two or three people they might meet during a sales presentation. Because of the blog, it may not be necessary for the consultant to attend so many of these meetings. So the actual cost would be much lower than £30k per year, and it is still opportunity cost, not real cash going out the door. Anyway, all if this is measurable – hours spent on chargeable time, hours spent on sales presentations and hours spent blogging and number of new customers who recognised the blog as a factor in their decision (and number of customers who found the blog a value added service which they recognised, and decreased the likelihood of going elsewhere – this is a question that should be asked too). The key however, is not to look at the ROI of the blog, but the ROI of the business problem the blog is addressing (in this case increased sales) and treat the blog as an input into that ROI.

Finally, I noticed two great statements whilst looking at this, one from SearchCIO which suggested that the potential business upside of blogging was so great that we should expect to see a lot more attempt by analysts and MBA-types to formally calculate the ROI. My favourite though was from Jeremiah Owyang who is someone who sees the ROI as so obvious that there is little value in calculating it. This is an interesting observation when replayed at corporate level. If you see day to day the anecdotal and intangiable benefits of blogging (or any other Web 2.0 tool, wikis, instant messaging etc.) then why spell out the ROI for your competition? If they want to spend the next five years thinking about it while you get on with it and enjoy the benefits that is a distinct competitive advantage!

Some of it is very painful to hear, but Dell are evidently not deleting critical comments. They’ve obviously taken the decision that if someone is going to say something negative they would rather hear it, and they would rather hear it in a forum where Dell has the right of response, rather than the conversation being owned by someone else.

Starbucks have already copied the idea, I wonder how long before these are standard for most companies?

• The invention of the printing press democratised ownership of information. The power was no longer held by the scribes who uniquely owned the means of production. In the same way, today’s media no longer owns the means of production or the content. Bloggers take up authoritative positions once held by news anchors. BBC News actively courts phone camera images of people who are at the scene before their news crew.
• The scale and pace of change was unbelievably quick. According to the programme, in 50 years over 20 million books were published from a standing start of 0. Some probably had a readership of 1, whereas others (such as the Bible) had a fundamental effect on the culture of the time. Similarly, there has been a massive proliferation of blogs in the last 5 years, many with a readership of one. Yet the popular ones rise to the top and the insignificant fade away
• There was a lot of fear about this revolution in information ownership. The Church, in particular, feared the end of their monopoly on interpretation of the Bible. Yet others recognised that if there was a widely available, universally consistent text (as opposed to messages transmitted verbally which were error prone, and even the scribes making copies were subject to error) this could allow a consistent understanding of faith. In the same way, some organisations fear the new world – Blockbuster, for example, seems fixated on a retail strategy whilst NetFlix, AppleTV, and even iPlayer and BT Vision clearly show the way of the future in on demand.

Could this change the world in the same manner as the printing press? Probably not on the same scale, it seems more of an evolution rathern than revolution, but the similarities were stunning.

Speaking of iPlayer, those within the UK can watch the programme here.

In a previous life, I was an SOA Evangelist for IBM’s WebSphere integration suite. A large amount of IT spend in the early 2000s went on systems like this one to integrate processes, both internally and with suppliers and customers. The idea was one of cost reduction, reduce the cost of doing business by reducing the time it took to add a customer to a vendor list from 3 days to minutes. The ROI cases were strong and compelling, and many customers managed to get ahead of the market through early adoption.

Now, however, such integration capabilities are more commonplace. Most business processes have been automated to the point where there is not a lot of cost left to be squeezed. Further, (and this is something that bugged me at the time) the vast majority of ‘real’ working practices don’t actually follow the process. The process becomes more of a guideline than a set of rules – exceptions to the process are the norm. Once you have an exception (payment terms are 30 days, but they’re a really important client so we won’t send them a nasty letter until 60 days) – the ROI breaks down as humans have to get involved again. Also, because the ROI cost case relies on people following the process barriers are often put in the way of breaking it, making it even more costly to “do the right thing”, be innovative, and follow an exception.

I was trying to find some stats on how much impact exceptions have on business processes. I am convinced somewhere I found something about 80% of processes resulting in an exception at some point. Vitria are so concerned about exceptions in business processes they’ve created a product for it and claim 50% of process related costs are down to exceptions.

Vitria (and others – I’m not picking on Vitria, they just happened to come high up on Google for “Business Process Exceptions!” offer exception management, but it sounds like another process. To quote from their site:

“Vitria’s Exception Manager is a purpose-built application that provides a systematic approach to resolve exceptions across your enterprise. Exception Manager classifies incoming exceptions, automatically resolves problems, guides resolutions with context-sensitive workflow when human involvement is still required, restarts the normal process flow, and provides full visibility and audit trails across the entire exception resolution lifecycle. “

So what happens when there’s an exception during the classification process. Or an exception during automatic problem resolution? The point is that Business Process Management vendors try to solve the exception problem with what they’re good at, a process. Where Web 2.0 can help here is by providing a tool that fits the problem at hand. What you really need when an exception arises is to communicate with the person who can fix the problem or authorise the exception. The problem is, traditionally, it’s hard to get hold of this person or even know who the right person is! That’s where enterprise social networking, blogs, wikis and especially instant messaging can become vital tools in resolving exceptions whereas email is not that helpful at all. This is why instant messaging is fantastic for large organisations during quarter end – the conversations are all around exceptions to the process – the key is to get the order in the books in a legal manner. We work with one of the world’s largest IT vendors who told us that the accepted downtime for instant messaging during quarter end is measured in seconds, whereas email is hours. Tools such as social networking can also help you find the right person in a time constrained situation, especially if your ‘usual suspect’ in finance or HR isn’t around and you need to find someone similar with the same skills quickly.

The aim of a lot of social software tools is they are based around tacit knowledge. Business processes, however, are all about explicit knowledge. Social software is the yin to business process yang. Exception management definitely falls into the ‘tacit’ space, however, which is why the explicit, systematic approaches to exception resolution fail. The exception is an exception precisely because a systematic approach does not work in this instance, and it is down to employee initiative and innovation to find a solution.

Looks like we’ve found another ROI for Web 2.0 – reducing the cost of business process exceptions which can be up to 50% of the cost of a process.

1) Sky have done the right thing by keeping the posting up after the negative publicity. To take the post down after it had been reported in the press would have been a mistake, as people searching for it and finding it had been removed would probably have imagined it to be worse than it was!

2) It is absolutely vital when writing blogs that you know your audience. o’Glaza probably had a certain audience in mind when we wrote the post who would be sympathetic. However, on a public blog you cannot target your posts so that only certain people will read it – the whole point is that it is there for the world to see.

Part of the reason we talk so much at Trovus about the importance of a blogging strategy and a content strategy is that blogs can ruin brands and reputations just as easily as they can make them. Blogs are a tool amongst many other marketing tools – it is how you use them that makes the difference and potentially allows you to differentiate substantially from your competitors.

There’s a lot been going around recently about the dangers that having a blog or Facebook/MySpace profile to your business image – but as I wrote recently there are also dangers about not a blog.

However, this comment caught my imagination. Few sales reps will call on a company without checking their website to get some background information. Similarly, few companies will accept a call from a sales rep without checking out the seller’s company on-line as well.

How long before it becomes a matter of routine not just to research the company, but also the individual – and you will be expected to have read the blog writings of the person you are about to meet, just as you would their company website?