Enterprise 2.0 – A $4.6 B Opportunity

A new study by Forrester forecasts that Enterprise 2.0 solutions to capture an astonishing market share of 4.6 billion by 2013 and Social Networks related technologies are expected to take the lion share of these investments, accounting for approximately $2 billion. These findings, as outlined by Sarah Perez and Larry Dignan, are consistent with my earlier blog on this subject.

Courtesy: Sarah Perez

Moreover, the study confirms the observations and experiences of Enterprise 2.0 professionals that the business leaders are enamored of business value from Web 2.0 technologies. However, the unbridled enthusiasm of business leaders often gradually tempered by the limited resources and budgets of IT support teams. In addition, the evolving stage of these invasive technologies in enterprise world mean new challenges for meager IT teams to find skilled resources that can make these technologies work for enterprise, balancing collaboration, security and controls. These internal challenges should naturally lead enterprises to implementation and thought partners that can help them in harnessing the power of Enterprise 2.0.

With these trends, I foresee vendors that package social capabilities into their existing collaboration offerings to have a clear advantage, especially in the large enterprise segment. For example, IBM Lotus suite with integrated Lotus Connections (social) and Mashup server mean less installation, implementation, integration and learning curve challenges for IT teams and organizations that prefer on-premise installations. Nonetheless, this packaging should also help IT teams to simplify and optimize the infrastructure and support structures.

Courtesy: IBM

In addition, for enterprises that are challenged by the limited budgets and internal skills, SaaS incarnations should be a natural evaluation. Especially in internal Social Networks area, I foresee excellent opportunities for Talent Management SaaS vendors to lead with best practices models (employee profile), integrations (Employee directory, trend analysis and learning’s) and security (SSO). With major Talent Management players already embracing some of these concepts, the forecasted trend spend should further proliferate vendor investments in this area.

Recession Proof Enterprise 2.0?

Recent Fed projections indicate slower growth and higher unemployment ahead. Unemployment is expected to peak to 5.3%, highest since March 2005. Does this mean obscure times ahead for IT professionals enamored of enterprise value from Web 2.0 innovations? Not necessarily. Data indicates that while some job sectors continue to feel the heat from the slowdown, IT sector is expected to sustain continued growth. According to a Gartner survey, more than half of participant companies plan to increase their IT budget in 2008. Furthermore, James Cooper in his Business Week column points that the Services sector continues to add new jobs while the overall employment rate continue to recede.

Source: Business Week

OK, why spend money on IT in a slow economy? The current unprecedented economic and business challenges mandate Enterprise 2.0 trajectory to reduce cost, motivate employees and create customer delight. Based on a McKinsey survey, Web Services (SOA) and Collaboration related Web 2.0 technologies top the list of executives in leading the business transformation efforts.

Source: McKinsey Quarterly

These business drivers mean exhilarating upcoming opportunities for IT professional with these Web 2.0 skills. So, get ready to enjoy the ride.