Outside In

What’s Beyond Web 2.0 and Enterprise 2.0? Biz 3.0!

April 19, 2007

Tim O’Reilly got the world thinking in new ways about the Internet with his principles of Web 2.0. Expanding from these principles, we can define the next generation of business. In this perspective, Patty Seybold lays out her principles of Biz 3.0.


Before you build upon the principles of Web 2.0 to craft an Enterprise 2.0 strategy for your firm, take a moment to reflect on what’s coming next. Remember that Consumer Web 2.0 isn’t really about technology enablement. It’s about consumer participation. Enterprise 2.0 isn’t really about supporting rich user interfaces, blogging, tagging, RSS feeds, and social networks for your employees. It’s about customer and employee empowerment.

What Are the Benefits from Web and Enterprise 2.0?

The bottom line benefits of both Web 2.0 and Enterprise 2.0 accrue when you empower your consumer and/or business customers to participate in shaping their online experiences with your company and with one another. Empowered customers are more engaged and more loyal. They cost less to serve and they contribute value by adding their own “spin” to your Web sites, your products, and to your brand experience. Your firm profits from the network effects that result as customers interact electronically around your products and your business. Web 2.0-enabled customers become designers, contributors, consultants, guides, and promoters to other prospects and customers.

How Will E-Empowering Customers Change Your Business Strategy?

What comes next? Once you’ve e-empowered customers, you’ll find that you’ve set a powerful catalyst in motion--one that will propel your firm towards Biz 3.0--customer outcome-focused business operations. Here’s how this evolution will play out:

1. Your firm’s strategy will become more focused on meeting your customers’ outcomes and on delivering their ideal experiences. (If not, your customers will defect!)
2. Your customers’ operational metrics will drive alignment and priorities among your silo’d stakeholders. Here are some examples of the kinds of metrics your customers care about:

  • The value of my financial assets has increased by X%.
  • I’ve attained my desired fitness goals.
  • My health condition has improved so that I can fully participate in life!
  • It’s easy and cost effective to get the products I need when and where I need them.
  • Our production line has no unscheduled downtime.
  • Our software upgrade went smoothly, and we are already benefiting from using only the new capabilities we needed.
  • You accommodated my need to change flawlessly and without penalties.

You’ll establish a clear line of sight and cultural alignment between the critical issues that matter most to your customers and your profitable growth. For example, by optimizing your supply chain and distribution channel to presume that customers’ requirements will change at the last minute, you’ll design change-friendly business processes. Or, by optimizing your wellness and healthcare delivery and payment systems to deal with unanticipated complications (from transportation and childcare snafus to complex family systems issues), you’ll prevent escalation while detecting patterns that will lead to breakthrough diagnoses and preventative regimes.


Tim O’Reilly and his team have done a wonderful job of explaining and evangelizing the principles and practices of Web 2.0.[1] Let’s extend that thinking to run in front of the next parade--which I’m calling Biz 3.0--as our customers lead us beyond a customer-empowered Web strategy to a customer-outcome-driven business strategy...

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