Web 2.0: Knowledge frontier for organisations

The rising popularity of social networking platforms and Web 2.0 mash-ups points to radical new ways of thinking about using technology to create and share information. Web 2.0 is currently a knowledge frontier and we should remember that in the past breakthrough innovations and opportunities often came from the adventurers on the frontiers, while the good folk at home focused on protecting the status quo.

“Fixmystreet.com, for example, illustrates the power of allowing customers to directly issue work orders to local councils in the United Kingdom, combining photos and maps to efficiently communicate what needs to be done and where. Individual citizens are now able to interact in a more direct way with councils, and councils are held transparently accountable for the speed of their response,” he said.

According to Dr Hodgkinson, the New Zealand government’s safeas.govt.nz public consultation on road safety policy, which enabled a transparent public discussion using interactive online forums – something the Kiwis refer to as ‘policy naked’. These are examples of opening up the frontiers of the organisation and allowing ideas and knowledge to flow freely across borders.

Dr Hodgkinson said frontiers are interesting places and frightening. However, those with an adventurous spirit will find it exciting and liberating. The Internet has caused a major shift in transaction cost economics, dramatically reducing the cost of finding and sharing information and coordinating activities between different organisations. This is enabling more decentralised, differentiated approaches to organisation and different ways of thinking about knowledge. A well known example is the decentralised mass collaboration efforts of Wikipedia.

“Many of us now find ourselves pondering a knowledge frontier. At our backs is the order and structure of our organisation, be it a business or a public sector agency, with its formal processes and information systems. Ahead of us is the wilderness of ‘the Internet’, with its overabundance of information opportunities and threats,” he said.

Dr Hodgkinson claimed success on the frontier, however, requires more than just an adventurous spirit and an optimistic outlook. The real winners are those that can mobilise both the commitment to take advantage of new opportunities and the ability to deploy their organisation's strengths in the new territories. The rise of the British Empire on new frontiers around the world, for example, was enabled by both the explorer’s passion and the nation’s military strength and logistics capabilities.

“Web 2.0 platforms are changing our concept of knowledge management by shifting the knowledge frontier outwards. As knowledge becomes more external to our organisations, perhaps even created by customers themselves, success is increasingly dependent on how internal and external information is combined, analysed and acted upon,” said Dr Hodgkinson.

He claimed transaction cost economics in the past tended to favour the integrated organisation with firm borders. Operational processes and their information flows were costly and oriented internally to optimise product or service creation and delivery. Useful knowledge tended to be generated internally and there were good reasons to keep it controlled and managed within the organisation.

According to Dr Hodgkinson, in order to be successful in the ‘new frontier’ organisations need to work out who the adventurers are in your organisation and send them to the frontier to see what opportunities exist.

“When they come back dusty and excited, listen to them and think about how you can deploy your organisation’s strengths to take advantage of any new realities they have discovered,” he said.

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