The Late But Unstoppable Rise of the Modern Virtual Enterprise

imageAs I’ve been telling lots friends, family and colleagues over the past few weeks, my recent move to BroadVision – announced just a short while ago – was one of the most deliberate decisions I’ve made career-wise in quite some time. I’ve been working on the consulting side of marketing for eight years, and the last time I went “in-house” to work as a staffperson for company was for a little-known company called VMware. If you know the story of VMware, perhaps you will understand why despite the many opportunities I’ve had to join other companies I have been so hesitant to do so. VMware is a tough act to follow. But in more than one way, the new BroadVision – which formally launched today – is an appropriate “next chapter” to my intermittent career as an in-house marketing guy.

First, there’s the general market opportunity. What was once an interesting-yet-sleepy market – Enterprise 2.0 – is now beginning to heat up. Two startups – CubeTree and ScoutLabs – recently got acquired. Another – Jive – is moving to Silicon Valley (our backyard) and talking about an IPO in 2011. More to the point, however, the real market – not just the M&A world – is beginning to respond. Practically every company I am speaking with these days is interested in Enterprise 2.0. Whether it’s because the business case for this category has now been established, or because enough companies have begun experimenting that others feel compelled to follow, the Enterprise 2.0 market has indeed “arrived” and I am thrilled to be entering ranks of technology vendors at this time.

But there’s a second, more important point of comparison – the concept of virtualization. It means many things to different people, but in the business world it has emerged as a catch-all for an approach to doing business that transcends the traditional confines of an enterprise and its assets. In the case of VMware, it was about the assets: servers that have greater utility when they can be sliced, diced and served more efficiently to meet the computing needs of an ever-expanding business market. At BroadVision, it’s about the confines of the enterprise itself: the people who make up the company and its market (partners, customers) and the physical, geographic, and cultural boundaries that separate them. Do something that meaningfully helps a company transcend those boundaries and you will have solved a major business problem. And, yes, you will have met a major business opportunity.

That’s the opportunity in the Enterprise 2.0 market, and why I am so excited. And just to make sure I can continue reminding myself of that singular opportunity, I have decided to brush off an old phrase – the “virtual enterprise” – and see if we can breathe some new life into it. It used to mean something else – the virtual enterprise was a business that wasn’t “real” but stitched together virtually by virtue of broadband networks and communication and collaboration technologies. With the advent of Enterprise 2.0 practices and technologies, the virtual enterprise has evolved into something else. It can now refer to any business that can leverage broadband and communication/collaboration technologies to create virtual spaces that mirror the way that business is done. The virtual enterprise is now “3D” – it’s more like a “place,” less like a thing – where things get done. And that, I will argue, is a profound shift. It has the potential to change so many things, like:

–It might change the strategy that businesses follow to compete in the new virtualized world. To date, the Web 2.0 mantra has been to connect. Going forward, the mantra might be to “create” – that is, to create the new virtual architecture in which their business will get done, inside and outside the enterprise, in public and private places. Which is not to say that businesses should ignore existing places where people on the Web congregate. They absolutely need to go there. But that doesn’t relieve them of the obligation to invest a virtual real estate of their own. With the next generation of enterprise social networks, businesses can do this effectively by providing their stakeholders to create these places themselves. What’s at stake here? A company with a small presence in the physical world might gain a greater presence – with lots of real estate — in a virtual world. For large companies, this should be a wake up call.

–It might change the strategy that many businesses follow to buy, sell, and deliver goods on the Web. If businesses do begin to virtualize the places in which they do their work, new way to do commerce on the Web will emerge. Think of this as the 3D version of e-commerce, another Web 1.0 concept that’s due for a refresh. And it can be any variety of digital goods, including digital services themselves. With so many productivity, communication, and collaboration tools moving to the cloud, this is already a reality.

–It might alter the technology landscape – especially for players at the platform level. With so many tools moving to the cloud – and with the growth of the mobile-technology device market — something else is likely to happen: the landscape of technology vendors will change. In this new virtualized, mobile, social world, who is best situated to provide productivity, communication, and collaboration services? Some argue that the incumbents will continue to rule the roost. Others bet on the pure-play cloud giants like Google. Still others think that telecommunication companies now have a fair shot at the market – indeed, they are already in the business of selling mobile computers. Impossible to know, of course, but the market forces that may soon be unleashed will only hasten the rise of the modern virtual enterprise, and all that comes with it.