Individuals in sharing communities generally create weaker ties to each other, as they are primarily motivated by the need for creative expression and its recognition, and they seem mostly unable to create their own infrastructures. Thus a new type of business is born, which enables and empowers the sharing to take place. Platform owners are in a difficult position, because sharing platforms need openness, but while openness creates massive social value; it does not create a mechanism to capture that value privately. Thus, while they need to be [dolphins] and promote a vision and practice of abundance and sharing for their user communities, they at the same time need to control and capture some value (act as ’sharks’ in an environment of scarcity), with which they can compete in [the market of attention]. It is essentially the aggregation of the attention of the users community which is the marketable commodity in this context, as the user-generated content is generally meant to be freely shared. This generally leads to an unspoken social contract, which from the point of view of the user goes something like this: we will gladly use your platform for our sharing needs, and understand that this is costly , and that it is legitimate that the underlying business makes a profit doing so, essentially relying on advertizing revenues to do so. However, if you restrict our freedom to share, we may very well go to a competing platform. [Such permanent tension, on the one hand between competing platform owners], and on the other hand, between platform owners and users, gives rise to a new [literacy] of engagement: user communities have to become fluent in recognizing the different interests that they have with the platform owners and to defend their own. For example, users may have to learn that some platforms require users to relinquish all their authorship rights and need to be aware of that. The involved companies need to learn the limits of their enclosure strategies, and the limits of their interference in the community norms and sharing ethos.

In a commons environment, the underlying social contract is also somewhat complicated. The companies that create marketable scarcities around, say, an open source software environment, profit from the created commons, and they need to return some of these benefits to the community. Generally speaking, when people create use value through voluntary engagement, introducing revenue sharing and payment schemes is counter-productive, and a shift to benefit-sharing is required. This requires looking for generalized returns to the community and its infrastructure as a whole; rather than payments to individuals. For example, companies may fund the annual conferences of the coding community, provide assistance with the infrastructure of cooperation, and other indirect means of support. Failure to create returns in exchange for the positive externalities of social innovation may result in an eventual rejection by the community. A recent example of this has been the conflict between the owners of the Couchsurfing.com (a hospitality exchange platform), and the voluntary developers, which is documented by the protesting coders at Opencouchsurfing.org . In this case, it would appear that the owners attempted to privatize, through nondisclosure agreements, the free work of voluntary coders.

Even in the more favorable and controllable crowdsourcing environments, the situation is still quite different from the classic corporate setting, as the contributors generally provide small independently produced modules, some of which may be subsequently sold by the company or platform, with the revenue being shared by both parties. This situation is quite different from the traditional division of labour, where the company orders a specific work to be made, in exchange for payment. In crowdsourcing, the production is free and ‘probabilistic’, i.e. it is produced without guarantee that the product will be sold or chosen. An example of this would be the stock photography sites such as iStockphoto.com.

It is important to notice what a dramatic reversal peer production engenders vis-a-vis classic industrial models and the division of labor. Peer production projects are based on the principle of equipotentiality, which means that individuals are considered to be mixtures of widely varying skills, which are impossible to judge from the outside. They therefore generally do not practice a priori selection of participants, but rather, modularize the tasks in such a way that individuals can self-select. There is no requirement for [a priori] credentials. However, the quality control mechanisms are moved to the back end of the production, through a posteriori modes of communal control and validation. Distributed production mechanisms are matched with distributed control mechanisms. Not filter then publish, but publish then filter. Not, order a piece of software, but: describe the need, then choose from the various solutions being offered. Peer production projects are also based on complete transparency, with every change recorded and participants having a full capability of knowing the context and detailed progress of what they are producing.

The generalization of the mechanisms of social innovation and direct production of social value through connected peers creates a fundamental [reversal in the role of individuals and communities vis-à-vis] institutions. No longer is an institution faced with atomized individuals that it can communicate with as a mass, but it is now faced with more powerful always-already connected individuals. [Rather than relying on traditional core competencies, corporations need to develop ‘edge competencies’, i.e.. skills that are geared on how to best relate to the various communities it will have to rely on.]

Such a dramatic shift in the external environment is bound to have an enormous impact internally as well. The individuals that are being recruited, are always-already connected in various networks, always learning in informal ways, part of various [’intensional’] networks that are not suspended when an individual starts to work.

Participation by user communities creates new social demands, and it also means that there is now a “law of asymmetric competition.” The strongest version of this hypothetical law states that whenever a for-profit corporation meets a for-benefit competitor that uses open and free raw material, a community of volunteers, participative modes of production, and commons-oriented output, then the former will tend to lose to the latter. In the weak version it means that any company adapting open/free and participatory tactics and strategies will tend to be stronger than companies that don’t. Britannica cannot compete with Wikipedia, closed source software cannot compete with open source, companies that allow for co-creation and co-design will tend to outpace those that don’t.

This is therefore the avalanche represented by Enterprise 2.0. These are not just sets of innocent technologies that merely allow more efficiency, doing old things better, but they introduce the alien logic of self-organized bottom-up, ‘distributed’ peer production in the belly of the ‘hierarchical’ beast that is still the modern corporation. The new generations of workers, especially the younger digital natives for whom ’sharing is the default option’, expect the full gamut of participative technologies to be at their disposal in the companies they start working for, and generally discover that today, it is the social world which is greatly in advance of the corporate world in terms of adapting new technologies. They are increasingly importing and expecting a work culture that is at odds with the traditional operating procedures of most companies.

WHAT IS ENTERPRISE 2.0?

So if companies need to adapt externally, to the new demands of consumers becoming producers and distributors themselves, of processes of social innovation that do not have clear institutional boundaries, it is also clear that there will be a difficult process of internal adaptation.

Workers now bring their own networks to the job. New generations expect a set of tools that allow them to share and collaborate quickly and easily ‘here and now’. They expect [a holoptical,] i.e. open vision of what is happening throughout the enterprise, as they have learned to rely on such open features in their online social networks. Because of the [prolonged exposure to a culture of abundance, they are acquiring a subjective culture of abundance as well.] It is indeed important to distinguish objective abundance, i.e. the capacity to produce shareable non-rival goods, from the subjective realization that this changes working practices. Corporations that function according to a subjective logic of scarcity, i.e. a reluctance to share knowledge in order to retain privileged power and influence, will not be able to use such technologies to their full advantage.

Indeed, in most companies, knowledge is only distributed on a need to know basis, with only the top management having a full overview. Companies are used to producing artifacts for their exchange value, innovate only to compete, and are used to captive audiences and partially locked-in consumers. Peer communities, however, produce directly for the use value. New zero-advertising companies and brands have arisen that have understood these dynamics, and for whom ‘the service IS the brand’, which is then massively spread by [word of mouth], thereby quickly establishing their leadership, as was the case for Amazon, eBay and Google. These new companies, as well as all those working with open source communities, have understood the new dynamics well and are at the frontline of how adaptation processes can occur.

The era of participation also means an intense pressure towards ethical and authentic behavior, not because people have become better, but because the sphere of transparency has been dramatically enhanced through the technology.

Enterprise 2.0 technology is therefore a Trojan horse, it brings with it, the underlying social values inherent in [their] design. Companies can therefore not simply buy into them, and carry on as before.

What is needed is an integral approach. The technology will not be adopted without changes in the culture, in the incentive schemes, in the way work and hierarchy are organized. [Subjective changes] by both employees and managers are also on the order of the day. The logic of peer production needs to be understood, so that the process of adaptation can begin.

A successful Enterprise 2.0 company is one that has created an efficient and open sharing culture amongst its employees, so that it becomes highly adaptable to the new participative demands coming from the ‘outside’. It becomes an enabler of participation, so that it at the same time helps in the creation of social value; through this, it becomes an essential and profitable infrastructure for social innovation processes, which it can enhance and strengthen through the advantages of scale.