Beyond Enterprise 2.0

You can bank on a tenfold improvement in the cost and capability of collaboration technologies over the next five years. What will your organization do with that?

Over the last decade, the Internet has transformed many aspects of the way business is conducted — from how goods are bought and sold to where work is done. To explore what might constitute the next generation of Web technologies and what effect they will have on the nature, purpose and management of organizations, MIT Sloan Management Review contributing editor Martha E. Mangelsdorf sat down with two leading experts: Erik Brynjolfsson, director of the MIT Center for Digital Business and the George and Sandra Schussel Professor of Management at the MIT Sloan School of Management; and Andrew P. McAfee, associate professor of business administration in the Technology and Operations Management Unit at Harvard Business School.

Looking ahead to the next year or two, what do you think are some of the most important ways in which the Web — and in particular so-called Web 2.0 technologies — will continue to change the way business is done?

Brynjolfsson: I expect a big thematic change in the way people have been using the technology. Because of the recession in 2001–2002 and really, frankly, some overspending in the late ’90s, there was for several years a focus within corporations on cost-cutting and using the Internet to save money, gain efficiencies and improve productivity. That was largely successful. But going forward, I think there’s going to be more of an emphasis on using Web 2.0 technology to support innovation, creativity, collaboration and information sharing. When it comes to what CIOs are asked to focus on, there’s a bit of a cycle that parallels the business cycle. Going forward over the next year or two, I see a focus on using the Web to grow revenues and foster innovation — as opposed to a focus on cutting costs.

McAfee: I think that’s exactly right. There are several trends going on — some of which have been going on for some time, some of which have started to accelerate recently — that support this flowering of collaboration and innovation and creativity that we are seeing on the Web. One trend is that the cost of participating on the Web continues to plummet. Processing, bandwidth, storage and memory all just continue to get cheaper and cheaper. It’s also getting a lot less expensive to contribute to the Web or to build an industrial-strength Web site.

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