Web 2.0 tools and technologies, things like blogs, wikis, podcasts and RSS, are changing the way companies communicate and collaborate, both internally and externally with customers, partners and suppliers. In last night’s The Social Nerdia Show!

I was able to speak with Michael Chui about how companies can successfully leverage Web 2.0 and social media. Michael, a McKinsey & Company consultant serving technology and telecom clients, has been co-leading research on emerging long-term technology trends and their impact on clients and some of this research can be found on studies published by The McKinsey Quarterly, including “Six ways to make Web 2.0 work.”

Listen to the Full Interview

You can listen to the entire conversation with Michael Chui at Social Nerdia. You can also subscribe to our shows on iTunes, stream from mobile phones on Stitcher, and listen LIVE on blogtalkradio.

For the past 3 years, Michael and his McKinsey team have been surveying over 2000 executives on their use of Web 2.0 in the enterprise. “There has been an evolution; the number one thing that has changed over the years is continuing adoption and usage,” Michael explained.

As more and more enterprises experiment and deploy the tools, it seems like more of them are starting to realize their real value. Michael explained that the results are impressive because “two thirds of respondents actually reported deriving real business benefits from the use of Web 2.0 in the enterprise, which is quite a powerful result.”

Some of the benefits discovered include an “increase in speed to access knowledge and expertise, increase in cost-savings related to communication and travel, increase in employee satisfaction, and increase in the effectiveness of marketing and customer satisfaction.”

Regarding how companies should encourage participation, Michael described Web 2.0 technologies as “essentially a bottoms-up technology.” He continued to say that companies “need to make the technology available and need to recognize that leadership is important” while at the same time predicting that “some of the best uses are not ones that you can predict.”

So, leaders need to support participation and listen to how the participation is occurring so that they can “follow where the supporters go” instead of forcing them to go in the wrong direction.

Collaboration in the Grey Area Between Enterprise 2.0 and Web 2.0

Some companies are quite prone to collaborate and it will be more difficult to balance between freedom and control. I asked Michael how a company that doesn’t have a Best Buy-ish culture, with a ‘Twelpforce’ Twitter-savvy organization full of passionate geeks (I mean that in a very good way), could approach social media. Michael responded that it’s true that “the most successful companies are ones which have cultures that are compatible with sharing and collaborating with each other and breaking down silos between organizations.” However, he also said that “it is possible for organizations to transform themselves” and “in order to be successful you might need to have a culture shift.”

That cultural shift will often include the unlocking of participation within the organization. Note that Michael said “unlocking participation,’ not ‘generating’ it. He has concludes “sometimes companies may be unlocking latent capabilities that were there already.”

Here are some steps that companies can take to become more participatory in nature based on Michael’s recommendations:

1. Make the tools available
2. Have real leadership that recognizes that a cultural shift must occur
3. Support that cultural change within the organization
4. Start small
5. Experiment
6. Scale
7. Allow employees to share, collaborate, and expose their thoughts

In addition to these steps, companies might understand what motivates their employees to participate. He explained that “you don’t (necessarily) have to pay people, it’s not the most powerful incentive… status and recognition is often much more powerful than filling someone’s wallet.” And once people are participating, you need to make it a part of your employees’ workflow. “That is the real key to getting critical mass,” Michael explained.

Regarding corporate blogs, Michael said that they continue to increase in use. “Corporations do have a need to make sure that their official messages are in fact their official messages.” More importantly, “if a blog is the CEO’s blog or another executive’s blog, it must be authentically theirs. It’s absolutely imperative.”

The world is paying attention and a company’s communications must not only be consistent, but they must be authentic, open, honest, and often transparent. With the advent of social media, authenticity is no longer an option. For a large multinational, social media is “a wake up call” because the message is no longer controlled by “the people that can buy air time on television.”

Michael said that companies need to understand that conversations are happening, and once they understand this, they need to figure out how they are going to be part of such conversations.

The World is Many to Many

He described the current state of the world wide web: “There really is a many-to-many world out there. There is a blogosphere. There are millions of people on Twitter and sharing things on Facebook.  That doesn’t mean that if you have 150,000 employees, you should let them all blog. That rarely is the right answer.

Some companies have been very effective in enabling relatively small productive social media group to both have sensing function to know what’s going out there and engage in conversations.”

Michael mentioned that it is important for companies to not just experiment but also scale. “Figure out what’s working and then do a lot more of it. That’s a lesson that a lot of leading edge companies have been able to implement.”

As Web 2.0 and social media tools gain usage, it is easy to start thinking about what Web 3.0 will bring. Michael has concluded that we are still in the early stages of these technologies and only now “starting to figure out how to enhance collaboration and how to be more effective and productive.”

However, there are some elements that we can expect to be part of the Web 3.0 or Web Squared evolution will bring. “The combination of mobile and location information, augmented reality, all of these things can be social-enabled; different screens, from the laptop to the lean-back television becoming a lean-forward experience, the small mobile device to the more tablet-sized device and the Kindle form factor. All of those technologies can be social-enabled. Devices can be for sharing as much as they can be for creating content and consuming content.”

Technologies and devices can be social-enabled. The question is, are you social-enabled?