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Four steps to becoming a Web 2.0 enterprise

A recent McKinsey & Co. report shows the areas in which Web 2.0 has benefited organizations.

The use of Web 2.0 technologies has not only continued to gain greater adoption among enterprises but has also proven to provide a significant competitive advantage, according to a new report from the McKinsey & Company.

Drawing upon responses from more than 3,200 executives across a range of regions, industries, and functional areas, McKinsey’s latest report found significant increases in the share of companies using social networking (at 40 per cent) and blogs (at 38 per cent). As well, the survey found that the number of employees using Web 2.0 technologies continues to increase.

According to McKinsey’s findings, the adoption of Web 2.0 by enterprises adoption provides a range of benefits from the ability to stage more effective marketing campaigns to having faster access to knowledge to make more informed business decisions.

The study authors, McKinsey’s Brussels office director Jacques Bughin, and McKinsey Global Institute senior fellow Michael Chui, have outlined a number of ways in which managers can help lead their organizations to become “fully networked enterprises”.

Here are some of their suggestions:

  1. Integrate Web 2.0 into employees’ everyday work activities. Through the course of this study and other supporting research, McKinsey found that integrating Web 2.0 technologies (such as social media and customer relationship management software) into the company’s work flow ensures that they are used by employees, and that their gains are maximized.
  2. Foster adoption and usage. Without a base-line level of adoption and usage, a company’s Web 2.0 benefits will stagnate. Enterprises must continue to drive adoption and usage because, according to the study, those respondents that reported low levels of both also reported the lowest levels of benefits.
  3. Break down organizational barriers to change. By enacting distributed decision making and work through greater collaboration within the organization and through all levels of the company, businesses have reported market share gains and profitability. Organizations that are fully networked, after all, tend to have a more fluid flow of information, deploy talent more flexibly to tackle specific problems, and allow lower-level employees make decisions.
  4. Apply Web 2.0 to interactions throughout the enterprise – and beyond. The McKinsey report suggests that businesses adopt Web 2.0 procedures for interaction between customers, business partners, and employees. This creates organizational collaboration and flexibility internally and with collaborative partners, but it also provides a better customer experience and the ability to better address client needs.

Fully networked organizations — those that have been able to truly integrate technology-enabled collaboration into their business — have been able to reap the greatest rewards. These businesses are able to forge closer marketing relationships with customers through better customer support and product-development efforts, as well as collaborate across traditional organizational structures and share information more broadly.

A natural consequence, according to McKinsey, has been improved market share.

Tax cuts, credits crucial to survival of Ontario digital media industry

After announcing its plan to cut business taxes and offer tax credits in , the Ontario government has reported success in creating high-tech jobs, and making the province a better place for innovative new companies.

Last week, Premier Dalton McGuinty visited Waterloo-based mobile software developer Polar Mobile. Since 2007, the company has quickly grown to become a leader in helping entertainment, sports and non-profit organizations reach new, mobile audiences. With this success it was able to double its staff over the past year to a total of 40 employees.

Polar Mobile and other Ontario businesses have benefited from the province’s recent tax relief plan that was introduced earlier this year. It effectively reduces overall business taxes by 28 per cent over three years, reduces small business income taxes by 18 per cent, and eliminates the small business deduction surtax entirely. Most notable for the tech sector, the government in its 2009 budget enhanced the Ontario Interactive Digital Media Tax Credit for labour, marketing and distribution expenses. The OIDMTC essentially provides interactive digital media developers who create interactive digital media content products in Ontario a refundable tax credit on 40 per cent of eligible expenditures.

Other Canadian provinces have taken similar steps. A British Columbia digital media tax credit, introduced earlier this year, offers a 17.5 per cent tax credit for BC labour to digital media firms (those producing content with two of three components: text, sound and images). Likewise, Manitoba offers 40 per cent of labour, and Quebec up to 37.5 per cent. Nova Scotia, meanwhile, offers 50 per cent of labour, and as much as 25 per cent of total productions costs.

According to the latest government figures, Ontario remains the top information communications technology sector in the country, with the $28.4 billion industry accounting for 48 per cent of Canada’s total.

The government’s great strides to make Ontario technology have not gone ignored. Overall, tax policy nor regulations across Canada created an unfavorable climate for venture capital, according to a recent survey from professional services firm Deloitte of Canadian venture capitalists. A mere 28 per cent cited tax rules as a major barrier.

The main fear for Canadian VCs, according to the survey, was that there lacks a critical mass of VCs. Further, the competition between Canadian VCs and emerging markets, as well as counterparts in the US and Europe, is fierce.

“This is an urgent situation and policy makers need to move quickly with measures that improve the odds of this vital sector here at home,” said John Ruffolo, who heads Deloitte Canada’s technology, media and telecom industry group. “We need to get more dollars into the hands of existing Canadian VCs, and encourage the creation of more domestic VCs.

“A reinvigorated Retail Venture Capital program (particularly in Ontario), angel and VC investing tax credits, and the expansion of government-sponsored fund of funds programs are the three main priorities. Some of these measures have been adopted in Quebec, and that province’s venture industry has seen growth in both the number of firms and the amount of capital available for innovation.”

Do Canadian entrepreneurs have a chance?

Photo by Merrick Morton/Columbia Pictures

In a recent blog post for the TVO current affairs program The Agenda, Stavros Rougas says that there’s something about Canadians that makes them averse to entrepreneurship.

Speaking with Ali Asaria, founder of Canada’s largest online health and beauty retailer Well.ca, he notes that the Canadian university experience tends to make students want to attach themselves to major tech companies like RIM, Microsoft, and Google, rather than to lead their own enterprises.

“Canada doesn’t have the same risk-loving culture as our more entrepreneurial neighbours south of the border,” writes Rougas.

Hello world!

This is a quick introduction to my new, personal blog.

I’m hoping to make this space a destination for insightful analysis and carefully considered opinions on technology. I will also try to provide how-to information (tips, strategies, methods, and ideas) as well as information, interviews, research, and up-to-the-minute links to material that could be of interest to those in the tech community.

I hope you enjoy it!

-David