FORTUNE Small Business

Boosting teamwork with wikis

It's not just for online encyclopedias: smart business owners use the new wiki software to encourage collaboration and save money.

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Cash and Grab: Lee Rosen (center) devised a $1,000 game to get his employees to start using a wiki.
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(FORTUNE Small Business) -- Egged on by his colleagues, Ben Sutton snatched $1,000 from his company's safe late last year. It was no heist, but the culmination of a fierce competition at Rosen Law, a firm that specializes in divorce cases in Raleigh. In an effort to get his employees to collaborate more effectively, owner and chief executive Lee Rosen had decided to put his entire operation on a wiki - with a $1,000 cash prize as an incentive to use it.

At its simplest, a wiki is software that lets users work together to create and edit a collection of linked web pages. The online encyclopedia Wikipedia is the best-known example - its 85,000 contributors have written, edited, and policed the content of more than nine million entries. Like Wikipedia, all wikis benefit from the network effect: The more people who use it, the theory goes, the better the quality of the information.

That's why all 32 employees at Rosen, from the lawyers and "life transition" coaches down to the receptionist and the guy who does the document scanning, had been creating as many pages on the wiki as they could. For each page created, they earned one new possible combination to the company safe. After three months they gathered in the conference room to see who had won the correct combination and the cash inside.

Long-Term Benefits

Although $1,000 poorer after the payout to Sutton, Rosen, 46, felt like a winner. He had created the game as a way to wean his workers from the expensive, high-maintenance software Lotus Notes, which they had been using for e-mail, calendars, contact lists, and case files. Lotus Notes is IBM (IBM, Fortune 500) software that requires a server, making it more sophisticated and costly than what many small businesses need. Rosen had been spending about $25,000 a year on it, including the cost of running the server and paying an IT consultant.

Instead, Rosen will now pay $600 a year to PBWiki, which hosts the firm's wiki on its remote servers. Everything from contracts to contacts has been uploaded to the wiki; Rosen will start moving case files onto it next year. One immediate saving: He no longer has to buy a $100 Lotus Notes license for each new lawyer who works for him. (The company hires about 20% of its legal eagles on a contract basis.)

"The biggest reason that we're switching is that the wiki is easier to use," says Rosen. "If employees see a better way to organize or present information, they can just go ahead and do it with a wiki. With Lotus Notes, it required a programmer."

The transition was not without tension. Given the power to organize all documents, Rosen's lawyers and paralegals immediately clashed over how to categorize the court orders that split up divorcees' retirement funds. The lawyers wanted them in the court orders category, while the paralegals thought they merited an entirely new category.

As with many contentious entries on Wikipedia, the two sides edited each other's decisions repeatedly until they came to a compromise: The orders could go in both categories. "It forced everybody to learn about each other's job," says Rosen. "That benefits us in the long run."

When FSB first wrote about business wikis nearly three years ago ("Workers of the World - Collaborate!" April 2005), they were largely untested, and early adopters were finding it hard to encourage employees to use them. Now the nearly universal familiarity with Wikipedia and a proliferation of services targeted at small business have helped make wikis commonplace. SocialText, one of the better-known providers, started hiring salespeople dedicated solely to the small-business market for the first time in 2007.

Rosen decided to take his chances with PBWiki after visiting Wikimatrix.org, a free site that suggests which wiki service might best suit your needs. It was built by a German content-management software company called CosmoCode, which does not offer its own wiki service. Wikimatrix doesn't do reviews - it simply lists more than 100 wiki companies and helps narrow down which one might be best for you, based on your criteria. Do you want to host a wiki on your own server or let the wiki company host it for you? Do you prefer plain text or html? Do you want a page history that will keep older versions of pages after they're edited? For Rosen, the key factor in choosing PBWiki was that it offered a free trial of its service.

Many firms, including Rosen's, are keeping secure wikis for purely internal affairs. But others are finding that opening them up to customers saves a surprising amount of time, energy, and money - and offers other benefits as well. Angel.com, a McLean, Va., maker of software for calling centers, which has 55 employees, created a wiki on SocialText last year that lets clients leave comments, share their likes and dislikes, and even submit suggestions for troubleshooting the software.

Those features have slashed the company's tech-support workload and given Angel.com a 10% boost in productivity, estimates company CTO Sam Aparicio, 33. That's worth about $500,000 a year, he says, while the wiki cost less than $10,000 over the same period. Clients "used to copy me on every e-mail, which created mountains for me to read," says Aparicio. "I'd say it saves every person here three to four hours a week."

He launched an internal wiki for Angel.com's product specifications, market research, and business plans four years before the external wiki, and was inspired by its success.

Seattle-based Guidant Financial, which markets investment vehicles for self-managed IRAs, has launched a site called wiki-investor.com. Users of the site read Guidant's articles on how to manage retirement funds, and can edit the articles and post their own. Founder and CEO David Nilssen says that aside from checking every couple of days for inappropriate content - say, a link to a dating service - Guidant does no editing.

"The community creates accountability," he says. "If someone puts up a mistake, it'll get corrected."

Nilssen, 29, hasn't spent any money to promote wiki-investor.com, so he's thrilled to see that more than 800 people a month are visiting the wiki. Even better, 230 of them are clicking on the link to Guidant's regular website. About 16% of those users become paying clients - more than double the conversion rate for those who find Guidant through search engines. "The results are undeniable, and the returns exponential," Nilssen says.

Wikis don't function well in every situation. Guidant doesn't put its internal operations on a wiki. It tried and discarded a rudimentary intraoffice wiki several years ago because the company was growing too fast and Nilssen found the wiki too chaotic. At Angel.com, production issues once posted on the wiki now have their own database, which assigns each a problem category, tracks its status, the customer affected, the date and time of resolution, and the time it took to resolve. Problems cannot be marked "closed" without a specific checklist being completed.

"We outgrew the wiki for that," says Aparicio. Sometimes not even bribing your employees with $1,000 can help make a wiki work. To top of page

Have you found a wiki that works for your business? Share your tips in our forum.

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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer.

Morningstar: © 2014 Morningstar, Inc. All Rights Reserved.

Factset: FactSet Research Systems Inc. 2014. All rights reserved.

Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved.

Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor’s Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2014 and/or its affiliates.