Organizations must embrace Web 2.0 technologies to remain competitive, but also be aware of potential threats and compliance issues. Alan Calder, chief executive of risk management consultants IT Governance has completed a report on the benefits and risks associated with Web 2.0 and told CIO they found serious issues at the board level.

"Young workers feel that Web 2.0 technologies such as Facebook, YouTube, blogging and Flikr, are key to how they do their job," Calder said. For CIOs, this means they must convince the organization not to enact total bans on these web based technologies, but to embrace them. "Sooner or later you will want to recruit some young people. If you shut off Web 2.0 technologies you are saying to young people 'we don't want you'". He said senior management must learn that the internet is "embedded into the way of life" of younger generations.

Ely based IT Governance found a worrying misunderstanding of the effects of Web 2.0 on their organizations. Most senior executives feared Web 2.0 was a drain on bandwidth and storage, and did not understand the issue of employees sharing their experiences of working life within your organization through Web 2.0. "If you have senior people who struggle with email, you will not get them to understand Web 2.0. India and China do not have 50 years of resisting technology heritage," he said.

Web 2.0 is an opportunity to engage with customers and partners, and companies that fail to utilize this technology will miss out on relationships with their customers and suppliers. "There is a genuine need for CIOs to enable people to use this technology to benefit the firm." Stepping away from the hype about Web 2.0 technology, Calder said in the past all messages from the corporation went through a long process of sign off by various levels of management. Email allowed all employees to communicate directly with customers and suppliers and Web 2.0 is an extension of that process. "No matter what policies a company has in place, people will tell other people what it is like to work there, whether it is through Facebook or a blog and everyone has a computer at home today."

Opening the floodgates is not necessarily the answer, as Calder points out, CIOs need to be aware of the threats their organization could face, such a legal action. CIOs must consider how comments could put their organization at risk of litigation, in breach of privacy or data protection laws.

Calder said the use of social networking services by Barack Obama is a good example of how a community can be engaged with and how an organization can monitor what is being said about it. "Most companies are even aware that there is bad news about them out there."