The ROI of Enterprise 2.0

In a traditional 1.0 world, there is a magic acronym to justify your investments: ROI or return on investment. Although B2B social media and enterprise 2.0 seem to be gaining momentum, the biggest hurdle the believers now face is to find some hard pay back cash figures. You might wonder if ROI is still a valid argument in a 2.0 world but the thing is, it's the CEO 1.0 who has to approve the business case...and you bet they are all number crunchers in recession times. So telling them that intuitively you feel E2.0 is the next big thing will not work I'm afraid.

However, most enterprise social media platforms are quite cheap compared to typical enterprise applications like ERP, CRM or proprietary business technology so it can't be that hard to make a sound business case? The devil is in creativity I daresay.

If you think about "return" in more traditional terms like pay back and value, you can use below metrics to come up with a first financial guestimate:

• Improve efficiency (speed of information)
• Decrease costs (communications costs, email storage)
• Make up for lost productivity (quicker access to the right information)
• Mitigate risks (issues will surface more quickly)
• Generate business growth (sharing information and knowledge opens the doors to innovation)

Agree, these metrics are based on sheer hypothesis and IF-scenarios but that's how most business cases are made, aren't they? In the end, E2.0 is really about a culture change... it's not about another IT investment.

Harvard Business School found that organizations focusing on shaping their corporate culture outperformed their counterparts significantly. Revenues were 4.1 times higher, stock price was 12.2 times higher, net income was 756% vs. 1% and return on investment was 15 times higher. Just look at GE - a typical example where cultural change really payed off. In the same area, other studies all mention double digit changes in the field of profitability, employee engagement,employee retention, recruiting & training costs, etc...

So when we bring all the bits and pieces together, we will end up with some hard figures that we can bring into the cost equation. And because Enterprise 2.0 also means bringing "social" back into the enterprise, here's my offer: If you have difficulties selling E2.0 to you boss, CIO, CEO or CFO I will help you - FOR FREE - in getting the numbers right... if that ain't social