Here is some good news to start the year. A new McKinsey report, The rise of the networked enterprise: Web 2.0 finds its payday, suggests that there are many benefits to be derived from using “collaborative Web 2.0 technologies.” aka enterprise 2.0.

The results from the analysis of their proprietary survey data show that the using these technologies is significantly improving reported company performance. The state that “our data show that fully networked enterprises are not only more likely to be market leaders or to be gaining market share but also use management practices that lead to margins higher than those of companies using the Web in more limited ways.”

First, the use of collaborative Web 2.0 technologies is substantial as two-thirds of the respondents reported using them in their organizations. Penetration is also strong as nearly half of the companies that use social networking have at least 51 percent of their employees using it. They are also investing as in 2010, nearly two-thirds of respondents at companies using Web 2.0 say they will increase future investments in these technologies, compared with just over half in 2009.

There are many quantified benefits. First 77% said the tools increased the speed of access to knowledge, 60% said they reduced communication coats, 52% said they increased speed of access to internal experts, 44% found a reduction in travel costs, and 40% found increased employee satisfaction.

They segmented companies using the new technologies into the internally networked, the externally networked and the fully networked. Market share gains were significantly correlated with fully networked and externally networked organizations. This makes sense and supports social media marketing efforts.

Even more interesting was the finding that “higher operating margins (again, self-reported) than competitors correlated with a different set of factors: the ability to make decisions lower in the corporate hierarchy and a willingness to allow the formation of working teams comprising both in-house employees and individuals outside the organization.” Collaborative technologies create more agile organizations and these companies achieve higher profits.


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