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Enterprise 2.0: A Balance of Collaboration Benefits and Compliance Concerns

By Dick Weisinger

Financial institutions are highly regulated, perhaps more than any other type of company.  And that’s part of the reason why financial companies have been slow in adopting Enterprise 2.0 collaboration tools.  Chris Kanaracus at IDG recently gave the example of the company Vanguard in a small case study.   The Vanguard Group is a US-based investment management company that manages approximately $1.3 trillion in assets and has about 12,500 employees.  It offers mutual funds and other financial products and services to individual and institutional investors in the United States and abroad.

Regulations are tough on financial institutions like Vanguard.  These companies are heavily bound by regulations.  Regulations that they need to comply with come from many places that include the Securities and Exchange Commission, private auditing firms and foreign regulators.  Vanguard manages a lot of money, and that implies that strong security is a necessity.  But equally important, Vanguard manages a lot of sensitive information — their client’s data.   It’s really no wonder that financial companies like Vanguard tend to be very conservative.  They make changes slowly and methodically to minimize any risks of jeopardizing the handling of large sums of money or with dealing with  their client’s data.

So it’s interesting to see how Vanguard is dealing with social media and Enterprise 2.0.  Not unlike most companies, employees at Vanguard have asked for better corporate software tools to enable collaboration, tools like ones they’ve become accustomed to using on consumer web sites.  The Vanguard IT group has created a strategy that selects social technologies for adoption  by  considering the advantages of  mobility, collaboration and “enriching” communications.

Vanguard has made some progress.  But there are many hurdles.  For example, regulations require that they be able to save and archive all messages in a non-rewriteable format.  They had been doing that for email, and they needed to come up with a way to do that with IM messages, and blogs and wikis too.  The company has also set up a number of internal collaboration sites and assigned a manager for each of the sites to regularly be checking the content posted to ensure the compliance of the information being exchanged.

Progress with the use of social media at Vanguard has been slow and deliberate.  It’s hard, but there has been progress.  IT is pleased with their success to date.  They next plan to expand their strategy to include focus on achieving “device independence” — allowing access to social tools from a variety of device platforms.  They also want to be able to better connect the social tools that they have developed.

Collaboration and Compliance often have conflicting needs.  It’s not an easy task, but with work, a balance between the two sides can be made possible.

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