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Intranets are becoming pervasive in business. Why is that, and what is happening to cause these changes? For one thing, the economy is changing, and demands on businesses are also rapidly changing. Customers want high quality, good service, low price, and they want it all now! If you don't give it to them, your competition surely will. In order to stay competitive, today's organizations must do things cheaper, faster, and better than ever before. Therefore, companies are forced to do whatever they can to compete. Companies are having to fundamentally rethink everything they do.
As companies work to do things cheaper, faster, and better, product life cycles shrink. You and your competitors race to get to market with new and better products. You feverishly try to replace your own products before your competitors do it to you. Innovation is the key to competitive advantage. Where does innovation come from? It comes from empowering your employees through learning, sharing knowledge, and collaboration. We frequently hear that the only sustainable competitive advantage comes from an organization's ability to learn. The concept of the Learning Organization was first espoused by Peter Senge in The Fifth Discipline: The Art and Practice of the Learning Organization. Learning Organizations are those organizations that encourage learning, creativity, and innovation, and empower their people to solve problems. They do this as a way to get a jump on the competition and to learn quickly and incorporate that learning as part of the organization's history and culture. The Learning Organization is embraced by organizations that are moving ahead in the 1990s. By empowering people, they are tapping in to the best creativity and innovativeness of their people and allowing them the flexibility to make good judgments. Good judgments come from experience. To be able to share that experience throughout the organization is to give everybody a jump start on what is necessary to make those good decisions. Intranets will be valuable to companies that are empowering their people. Why is this so important? Your very future is at stake--if your competitor does it before you do, you may be history! That sounds pretty strong and ominous, but in the crazy 1990s many companies have found that their strategic advantage evaporated overnight. We know that communication is people talking to each other, and collaboration is people working together. Just what is knowledge? How do you share it? A few years ago in business, we focused on getting data and reports. We transitioned from using just data, or raw numbers, to using tools to turn that data into information to help us make better decisions. With information, you could spot a trend and project its impact. Now we have moved forward another step, toward capturing and using knowledge. That's where you capture not just numbers, but what people know. Knowledge can include what your experts know. It can include expertise you have learned in developing your products. Knowledge can include what you know about your competitors and their products. It's also what you know about your customers, their needs, their feelings about your products, and what they think about your competitor's products as well. Once you have that knowledge, it's how you use it that determines whether it gives you a competitive advantage. Since employees acquire knowledge and act upon it, those employees then become an organization's greatest asset. It's their ideas, inventions, and innovations that become the source of sales and profits. Knowledge will be the currency of the future. If knowledge is a key, then how do you collect and maintain that knowledge? This is what groupware does. Groupware facilitates communication, collaboration, and capturing the organization's knowledge. Groupware databases, known as knowledge systems, serve as the repository for recording people's learning and experiences. Lotus Notes was one of the first such programs, although there are now many others. Many companies consider their knowledge systems to be a major competitive advantage. Since sharing knowledge has become critical for business survival in the 1990s, many organizations are investing millions of dollars in deploying groupware and knowledge systems. These systems make it easy to tap into the collective knowledge of the organization. By using search tools, it is easy to find the people with the knowledge you need. These systems can hold not only text, but also various types of multimedia. These knowledge bases can even extend beyond the boundaries of your organization and out to your business partners. So why doesn't everyone have these knowledge systems? Well, for one, they have been very expensive, although that is changing. Companies are starting to see that they can get many of the benefits of these knowledge systems by creating intranets, and at very low cost. This is one of the reasons intranets took off. They provide a quick and easy way to capture and store knowledge. You can capture knowledge through threads of discussion groups and by publishing documents on the internal web. The tools are not yet as sophisticated as Lotus Notes and other groupware tools, but that will change. Because of the need for more sophisticated intranet tools, many companies are working fast and furiously on solutions, which we can expect to see soon. The information captured through the intranet provides the foundation upon which to build a full-fledged knowledge base. Collaboration is about working together and sharing together. Tapping into the collective wisdom and knowledge of your employees is a requirement to enable you to compete effectively today. Groupware provides capabilities such as: Lotus Notes is perhaps the most widely known groupware product. The reasons companies create intranets fit two major scenarios, each of which contains a lot of dimensions: Let's consider each of these major categories in turn. When everyone can have an intranet, how does a company use an intranet for competitive advantage? It comes from integrating your databases and applications into the intranet. This allows your employees to leverage that information through improved decision making, productivity, and service to your customers. This also stimulates creativity and innovation. The value that your employees add becomes your competitive advantage. This is a natural by-product of the things you do with your intranet. Almost every company I spoke with listed improved access to up-to-date information or timely delivery of information as major results from having an intranet. The types of information available were as varied as the companies. The intranet at SAS has become the de facto standard for publishing. People can now find information and documentation without having to search blindly through the file system or ask others for access locations. Amgen found that the most effective use of its intranet so far is to provide access to corporate library materials. AT&T believes that its information is now more accurate because people can update their own information. Even those without desktop computers at Turner Broadcasting can use freestanding kiosks to access human resource information. Intranets are fast becoming the primary distribution and communications vehicles in many companies. Some are even extending the types of information available to users. For instance, the impact so far at EDS has been so great that it is committed to getting even more information delivered via the intranet. EDS has reached an agreement to add the PointCast I-Server to its intranet. By selecting from categories of information, employees will receive personalized news and other information directly on their computer screens. This includes not only outside information but also internal EDS news and announcements. This will allow EDS to immediately communicate bulletins to those who need that specific information. Virtually every company I spoke with is adding Web interfaces to their legacy and client/server applications in addition to developing many new applications for their internal web. The web will become the universal interface for access to corporate information. So much so that SGI now makes several hundred thousand pages of operational data and ideas available through its intranet. EDS is now putting much of its information within the context of processes to convert that information into knowledge. Another frequently cited result is the cost savings. This is the one of most interest to executives. Most of the companies I spoke with replaced any paper that they could with an intranet to save money on printing, warehousing, and distributing documents. They also saved money by eliminating faxes and memos. Since the intranet includes the network, some companies found cost savings through eliminating redundancy in their networks. AT&T, for one, estimated that through consolidating its individual networks into a single global intranet its has saved about $30 million per year. This resulted from reducing duplication of people, equipment, and other costs. Bell Atlantic also reported that it has saved several hundred thousand dollars so far through consolidation and reduced printing. Bell Atlantic is now experimenting with moving EDI to the intranet, which should yield significant cost savings. One other large area of cost savings relates to the cost of proprietary solutions. With browsers and servers cheap or free, nothing else competes on price for so much functionality. Another often cited result was time savings. When the information they need is only a mouse click away, employees don't waste time trying to hunt things and verify their accuracy. This efficiency turns into greater productivity. EDS reported improved efficiency and productivity because the intranet provides faster communication of information and a more intuitive user interface, which improves people's comprehension. SGI is progressively implementing applications that increase organizational productivity. An example is its Electronic Requisition System, which its uses to manage purchase orders and the associated approval process. This workflow application reduces the time it takes to process and track requisitions. Intranets allow users to do things more efficiently, which allows them to use the time they save to do things more effectively. Turner Broadcasting feels that each employee who learns to use the intranet will be more effective. EDS even provides job aids through the intranet to assist employees in doing their work more efficiently. Workgroups at AT&T communicate electronically, which improves their efficiency. The efficiency doesn't just apply to users. Intranets are a welcome relief to IT groups as well. They're easy to maintain, which requires fewer people. SGI, for instance, with over 2,000 servers, has a staff of only five to handle their intranet. Many companies said that the Web is now their platform of choice for applications development and to modernize their legacy systems. The intranet even lets them reuse software components. The end result of all of this for IT is that intranets stretch their budgets farther. You can now do more with the same budget. Intranets provide timely access to people and information in order to help you make better decisions. Often, when trying to get answers, you play telephone tag. It's even worse when employees and workgroups span time zones, especially on opposite sides of the globe. If employees don't have information available to them, they may make bad decisions. Even worse, they may make no decision at all because they can't get the information they need. Things happen slowly until the information becomes available, and in this fast-paced world, not having the right information can lead to lost opportunities. With an intranet, the answers are at your fingertips and you can act quickly to make a decision. Decisions based on facts will inevitably be better than those made without facts. The Net is particularly effective for situations where the competition has just come out with a new product. For instance, if Sun comes out with a new product, SGI can have a video on Silicon Junction in just 24 hours to enable salespeople to respond. By putting videos and sales information on the intranet, their selling can be more proactive. Intranets have provided a lot of good news for IT. Since they are inexpensive to deploy and maintain, companies have saved money over other solutions. Even better, users now take control of their own information. IT simply provides the infrastructure and services. At Texas Instruments, intranets empower the end users to provide their own information management solutions. This means that they have less dependence on the IT department. With absolutely no work other than to register their server, they can make the information available to anyone in the organization. As if this weren't good enough already, as better tools come along it will be even easier for end users to do almost everything themselves. Booz Allen and EDS both said precisely the same thing: that their intranet allowed them to leverage their intellectual capital. It has changed the way they think about knowledge and information. EDS puts its customer profiles and project outlines on its internal web to capitalize on the intellectual capital available within the corporation. The intranet also opened up new business opportunities for several companies' products and services. Another interesting twist is that several companies are generating revenue from vendors who pay to advertise to employees on the internal web. These are ways these companies have tapped into the power of intranets. What could you do with your intranet? The end result of all this should be improved service to customers.
If intranets cause you to do things faster, cheaper, or better, then
customers benefit. Happy customers translate into profits and happy
shareholders. |
Buy the Book  Paperback - 396 pages ISBN: 0471163740
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