There is a dark side to Web 2.0 technologies. Like its predecessor Web 1.0, this technology transformation will alter the fabric of how business gets done. I was watching the Antique Road Show last week and one of the hosts made an interesting comment about the web. He basically said that the internet has destroyed the antique business with price transparency. Prices had eroded with the sites like eBay entering into the market. The example item was a poster which was once thought as extremely rare until the internet exposed the actually number of available prints. Hence the price drops and the profit is removed for the individual dealer. This is really no different than how the web eliminated the need for travel agents and reduced the new car negotiation method to bringing in a web quote. Simply put, the web changed everything and historically speaking is the number one profit killer of all time.

Will Web 2.0 have the same impact on the business world? While that remains to be seen, we have already seen several examples of where this technology has had a dramatic effect. Take for example the Kryptonite lock that was advertised as the "toughest bicycle security in moderate to high crime areas". It didn't take long for someone to pick the lock with a Bic pen and post the video on YouTube. The company was forced to recall 380,000 locks. One response to this type of transparency is to hide behind the corporate walls and discourage open communications. The idea is that if we shut off communications then no one will know our dark side. But the authors of Funky Business (Kjell Nordstrom and Jonas Ridderstrale) said it wonderfully, the "stupid, loyal and humble customer, employee, patient or citizen is dead".

Other companies are leveraging the Web 2.0 technology to increase their business value in very creative ways. Blendtec is a manufacture of high end blending machines. They routinely post videos of the blending odd items like Golf Balls or the iPhone just to demonstrate the power of the product. The idea is creative and viral which is exactly what you want to see in a 2.0 world. Organizations that hide behind corporate speak will continue to find themselves on the defensive and losing market share. The dark side of Web 2.0 is reserved for those companies that fail to change; inside or outside.

It was 1973 and I had just got my Evil Knievel jump cycle; the one where you wind the crank, hit the release and watch Evil speed down the hallway toward the makeshift ramp. Soon the sun was up and I wandered past my 3 Speed bike (with banana seat) and the idea hit me. Evil plus Bike plus Towel for a Cape equals Really Cool and I envisioned myself jumping the creek behind our house. It all seemed easy enough; pile up some dirt, get a running start and glory was mine for the taking. I would be the talk of the school come Monday morning. Sixty minutes later, I am in the emergency room watching my dad faint as they set my arm for a cast.

We seem to have an obsession with people that take risks and emerge as winners. We enjoy watching sports where our heroes risk it all. One of the top shows on TV is House where Dr. House seems to risk his patients life every week and we tune routinely. Our business leaders love to quote the risk takers like Welch, Gates, and Jobs and use the analogies to inspire us. Unfortunately, it is "they" that are the ones that take risks. We on the other hand, do everything we can to avoid risks. We buy flood insurance to protect us from the Noah's revenge. We take those extended warranties to assure ourselves that the new Wii will last forever despite that fact that the next big thing is only a few years away. We take our children to the park that is surrounded by fences and six inches of cushion in case they fall off the monkey bars. We chuckle at warning labels that protect us from ourselves like McDonalds warning that the Coffee may be hot or the superhero costume that says that the "Cape does not enable user to fly".

The problem is that life itself is a risk and life rewards the bold. Enterprise 2.0 is about introducing the idea that you are more than a number. I would like to think I am more than just ts1809 to the corporation. We are entering a new era where the knowledge and information is more important than the physical assets the company keeps on the books. And, it’s not just the knowledge but the timeliness and accuracy of that information. The real value of the company is in the ideas, relationships, innovation, and information that is within each and every one of us. What is the risk of commenting on a blog, sharing your knowledge in the corporate wiki, or integrating collaborative technologies within your organization? What's the risk of not doing it? What's the best thing that can happen if I keep my ideas to myself? The greater risk, to the future of this company, is in not implementing Web 2.0 technologies. Like fossil fuels, the gas tank on cost cutting measures is running close to empty. We must move towards an idea based organization where theses ideas flow freely. We have the tools and technology but are we, as individuals, ready to don the cape and jump over the command and control mentality?

Recently, the Wall Street Journal published an article on why online communities fail. The author, Ben Wortham, quotes a study done by Deloitte on 100 companies that have attempted to build online communities. The research pointed out that around 35% of the companies reviewed had less than 100 members and 25% had fewer than a thousand members. What isn't clear is if these numbers only represented the number contributors or how big the reader population might have been. In some business situations, the contributor rate might be low but the readership rates are extremely high. The report concludes with three key areas of concern for these type of implementations.

1. Too much of a focus on the technology; bells and whistles
2. No fulltime employee engagement or subject matter expertise involved
3. No ROI or metrics used to measure progress

These three elements coincide with what we have seen inside the corporation as well. While #1 has not been as big an issue, #2 and #3 have shown how they can derail even the smallest community effort. That being said, let's add a few more that we have seen over the past few years.

Online communities seem to struggle when there is no real business reason to get involved. Focusing on the business environment, people need a reason to come to the community. This reason may include customer support, tips, techniques, best practices, news, or simple sharing of information. Communities that try the open end or "anything goes" approach will struggle to stay afloat.

The information needs to be updated frequently and by qualified members. Information can become stale real quick and without a constant flow of content, members will find better things to do with their time. How often and how much is up for debate but most blog experts say 2-3 times a week is adequate.

While not covered very often, rewards can be offered to encourage traffic and contributions. We give a book away every month to a random customer just to show our appreciation for the business. Rewards do not have to be physical; they can be emotional such as the ranking and rating of content. Everyone wants to feel needed or that they are helping in some way, so the rewards can be extremely valuable to the life of the community.

Finally, time is often overlooked in this instant gratification environment. While there is no set formula, you need time for the community to evolve. False starts and technology reductionism is a common within large and small groups. So be patient, time is on your side.

The field of knowledge management seems to have been around for a very long time. Most of the experts in the field break down the components of knowledge management to the following.

1. Acquiring Information
2. Organizing Information
3. Storing Information
4. Distributing Information

Something magical happens between storing and distribution that actually creates the contextual understanding of the information (i.e. knowledge) but for now, we can leave that alone. This breakdown seems simple enough, but what happens when we pull back the curtain and examine each one in our new 2.0 world. I was recently reading a rather dated book on investing. The advice was to go down to the local library and review several periodicals like Moody's and Value-Line. Then, contact the company directly so see if they would mail you an annual report. Wow, talk about how times have changed. Most, if not all, of that information can easily be retrieved over the web. You can screen thousands of stocks at the push of a button on sites like Etrade. Today we have Google, Wikipedia, and a zillion other sources to provide us the information we need. It wasn’t too long ago where businesses brought in high paid consultants or research firms to present the latest trend such as Six Sigma or Re-Engineering. Today, 90% of information needed to implement can be garnered from the web. Perhaps, it's that final 10% that's worth paying for. The time, resources, and cost of acquiring information is fast approaching zero due to the technology advancements of our time.

Organizing is the process by which you catalog information just as we did in the old days with card catalogs at the local library. We take information in its raw form and try to find ways to organize it so that we can retrieve it at a later date. Of course building a library and creating an inventory of physical objects is not only expensive, it is very time consuming. Imagine going into your local grocery store and trying to locate the cereal isle. You go up and down, squinting at signs, and testing your long range vision trying to spot the Lucky Charms from the end isle display. In the digital world, you simply perform a search, update your favorite list or utilize one of the many book marking sites. You can use RSS to organize your daily feed of news or get the latest blog post by Tom Peters. While the amount of information is growing, our ability to organize vast quantities has also greatly improved.

Storage may be the most obvious gravitational pull to zero we have. Last week, my wife got a 2gb USB storage device in the mail simply for renewing her subscription to Pharmacy Times. No, it wasn't "Geeks Are Us Monthly", it was a pharmacy journal. It was just a decade ago when that kind of storage would have cost you $10,000. It is not just the physical storage but companies are willing to allow you to store your data on their hardware in the hope of selling you more value-add services.

How much does it cost to send a package today? I sent a letter to Stockholm a few weeks ago and it cost about $0.95. How much would that have been in 1950? I could have emailed the letter for two cents if a physical copy wasn't required. Think about a phone call from New York to London which would have been $200.00 in 1940. In 1970, you paid $2.50 per minute and today you can have unlimited calling for around $10.00 per month. Distributing information over the web allows you to communicate to millions of people without having to buy a Super Bowl ad. Hence, the communication or distribution costs of information are approaching zero.

Just about every aspect of knowledge management is approaching zero so what does that mean in the generation of value? What is going to happen now that information, which was more valuable than gold, is now free? Like any business built a top a commodity, you must find innovative ways in which to deliver or enrich the information. Organizations must realize what is happening in the outside world is also happening inside the enterprise; that is, all information is approaching zero cost. They must turn their attention, not on the idea of cutting costs such as reduced storage, lower service level agreements, or lower functionality. Instead, they need to learn to leverage the information managed by our collaborative systems.