I’ve been working in the interactive gaming and gamification industry for over four years now, first as the founder of a now-defunct start-up focused on developing interactive training games, and most recently as a hands-on catalyst for enterprise gamification. It’s been gratifying to see this idea crop up as a topic of considerable interest – and research – in 2012.

And while the majority of what has been done with enterprise gamification to date has really been about marketing and customer engagement, I believe that we’re poised for an enterprise gamification revolution inside the enterprise that will take the largely unrealized concepts of social collaboration and create the engagement metaphor that will, finally, help companies realize these lofty social/collaborative goals. And their lofty investments in what has been a less-than-stellar reality for many, users and vendors alike.

The bottom line concept for why enterprise gamification will enable real social engagement and collaboration is this: our existing enterprise business culture and its processes and technology have ill-equipped us for supporting the kind of ad hoc collaboration that we need in order to take business efficiency and effectiveness to the next level. Nor are we able to use new social media and collaboration tools to force fit this requirement into the enterprise. Why? Because, fundamentally, we don’t know how to collaborate in this wild world of unstructured, ad hoc, highly interactive, always-on and highly virtual people-to-people-to-enterprise connectivity.

We need not just new technology but new kinds of processes in order to meet these requirements: Enterprise gamification will show us the way.

In the old world of ERP-based transactions, business processes were largely proscribed – either by regulation, law, or practice. This made it relatively easy to design and build a process for, say, invoice reconciliation, that, while perhaps boring and inflexible, was proscriptive precisely because there was a process that had to be followed to reach a desired outcome. This ability to define processes led to the growth of the enterprise software market that we know today: proscriptive, repeatable processes codified in packaged software. That’s been the state of the market for over 20 years.

In the new, post-ERP, post-transaction world, we have discovered that trying to harness the potential for human interaction and collaboration can’t be based on neatly proscribed processes, because real human collaboration simply doesn’t work that way. Indeed, we often cannot begin to fathom what the process would actually be to, say, collaborate on building and maintaining an enterprise knowledge base, mostly because to command that it should happen, the way we command that invoices be processed according to GAAP rules, is neither possible nor desirable. You simply can’t order your way to a truly collaborative process.

Rather, when looking at the post-ERP requirements of the 21^st century social/collaborative enterprise, instead of proscribed processes, we have desired outcomes. This notion of outcome becomes the focal point of a collaborative process the way transactions were the focal point of classic business processes. Thus, an outcome might be something as basic as “better customer service” or “better cross-business unit collaboration”, but in either case outcomes start with two basic characteristics: that lack of proscriptive process I just mentioned, and a conviction that an outcome can benefit from collaboration between different stakeholders, if only there were a collaborative process in place to make that happen.

The notion of outcomes has two more essential characteristics that need to be understood: they have a genuine value to the enterprise, and that value can be turned into a KPI that hopefully can be measured in some fashion or another. Gamification, it turns out, is ideal for analyzing and reporting on these values.

Finally, there’s the final rock-solid foundational component for enterprise gamification, which I alluded to above: despite the desirability of the outcome, the stakeholders need to be shown how to collaborate in order to reach these goals. This is the dirty little secret of the social/collaborative world in which we are trying to live today. We’re not a very collaborative society – this is, after all, the nation of the rugged individualist, the Jeffersonian pioneer conquering the wilderness. Enlightened and capable, naturalement. But collaborative? Not us.

This is where enterprise gamification becomes a powerful tool for the 21^st century enterprise. The key benefits of enterprise gamification are seen in providing a system of incentives and disincentives that direct individuals and groups towards a specific set of behaviors that in turn positively influence a desired outcome. A well-designed enterprise gamification environment becomes an engagement mechanism for collaborative behavior that can overcome the natural inability of people and enterprises to collaborate effectively towards a common goal.

Thus, the classic gamification elements such as points, badges, contests, leaderboards, ratings – not to mention fun – are put to use incenting people to collaborate and cooperate towards the desired outcome. On the way people get tangible rewards, peer and supervisor recognition, a sense of purpose and collective action, and other psycho-social rewards that can help the individual and the enterprise reach the apex of Maslow’s hierarchy. And have some fun doing so.

But that’s not all. Because all the stakeholder interactions are taking place inside a gamified technology platform – even those interactions that require use of some enterprise or desktop software system – there is an unprecedented ability to measure how well individuals and groups are collaborating. This analytical capability isn’t just limited to people: the same environment can also show as how well the technology components – the gamified elements and the enterprise or desktop software systems – are working towards serving the desired outcome. This ability to measure how people and processes interact – and offer guidelines for improvements –  will provide an unprecedented window into the enterprise’s overall effectiveness.

Meanwhile, something subversive is happening inside the newly gamified enterprise: people are more engaged, more able to understand and support the outcomes that matter to the enterprise, and they are being recognized and rewarded for these actions. This ability to acknowledge the contribution of individuals in a collaborative endeavor isn’t unique to gamification. But only in a gamified environment can everyone – employees, their peers and their supervisors – see the value of those contributions to the individual, the work group, and to the company as a whole.

In conclusion, I have to confess to an essential problem that continues to bedevil enterprise gamification: a real ROI. The problem with the above is that it’s very theoretical, there simply is no data to prove that enterprise gamification works, yet. That’s the real goal for 2012: start taking the theory into the field and show how it works, and do it well. That’s one of my person goals as a gamification catalyst, and one that I will be writing about further as the year unfolds.

Luckily for all of us in enterprise gamification, there’s lots of solid data on how well traditional multi-user, online gaming works in terms of issues like user engagement and knowledge transfer: multi-user game researchers like Nick Yee and game-based training researchers like David Williamson Shaffer, to name two of hundreds of researchers in these fields,  have amassed considerable data that supports the notion that gamification could have a powerful impact on the enterprise. This body of research is vast, comprehensive, and provides, in my opinion, an effective starting point for cost justifying enterprise gamification. But more is needed, nonetheless.

So, hold tight, it’s going to be a fun year, and a year when fun enters the enterprise in the most subversive guise possible: as a means to make good on social collaboration and the potential for greater efficiency in the performance of ad hoc processes. It’s a worthy goal, and enterprise gamification is a worthy platform. Onward!

This article has originally been published on Enterprise Application Consulting and been republished here with permission by the author.

About the Author: Joshua Greenbaum has over 30 years of experience in the industry as a computer programmer, systems analyst, author, consultant, and industry analyst. Having helped pioneer coverage of the enterprise software market in the late 1980s – following now-defunct companies like D&B and Cullinet, as well as the likes of Apple, Hewlett-Packard, IBM, Microsoft, Oracle, Sybase, among many others – he moved to Europe in 1991 and worked as an industry analyst and as European correspondent for Information Week and other industry publications. It was during this European tenure that he wrote the first technical analysis of SAP’s R/3 enterprise software suite, a move that helped establish him as a leading expert in the market. He founded Enterprise Application Consulting in 1998 and has been a pioneering independent analyst and consultant ever since.