Are Businesses Missing The Benefits Of Collaboration Technology?

Last night I had the pleasure of attending a customer case study session hosted by Cisco. Representatives from two clients -- SmithAmundsen (a law firm) and Republic Services (a waste management company) -- discussed how they were deploying Cisco unified communication and collaboration technology within their businesses. While the two speakers presented compelling stories about the need for collaboration within business, what caught my attention was where their companies received value. The constant refrain was these technologies saved money on travel, office space and IT expenditures. This isn't a new story: last year at Cisco's Collaboration Summit, Vid Byanna of Accenture mentioned that travel cost reduction was a big driver for his firm adopting desktop video technology for its remote workforce. Nor is this a Cisco-specific story: I recently published a report that shows the majority of content and collaboration professionals say travel reductions is the #1 benefit of collaboration software. But does it teach us the right lesson about the value of collaboration software?

In general, when we think about finding ways to let employees come together in groups to do work, we assume some type of business benefit: faster problem resolution, more innovative ideas and quicker time to market are a few examples. So why, in a business world where 42% of the workforce is mobile, do just 19% and 9% of content and collaboration professionals see improved innovation and faster time to market, respectively, as outcomes of using collaboration software? I have a couple of ideas that I'll be testing in my research going forward. I think this disconnect springs from one of three places:

  • Collaboration tools are adjacent to the collaboration strategy. This theory argues that a company has a set of outcomes it wishes to see (e.g. quicker time to market) and has set up policies to facilitate actual collaboration between employees to achieve these outcomes. But the collaboration technology these companies have implemented isn't viewed as fundamental to the business's collaboration strategy. Instead, they are tools deployed by the business to lower costs (e.g. travel) associated with the collaboration strategy. Thus, the business measures the success it has with these technologies through overhead reductions.   
  • Collaboration tools are deployed before there's a clear collaboration strategy. This theory springs from haphazard way in which many businesses have deployed collaboration technology. From the executive suite, there is a demand "to be more collaborative." The IT department translates this to mean, "buy collaboration software." Of course, these actions are taken in absence of any real understanding of what outcomes the business hopes to achieve and how it will go about doing so. So, when it comes time to justifiy expenditures on collaboration technology, it's easiest to reach for the low-hanging fruit: reduced travel and other costs.
  • Benefits of collaboration tools beyond reduced operational costs are too hard to measure. This theory rests on the idea that observing the real business benefits of collaboration software come from examining the business processes they enable. And because these are specific to a job, there are no easy, generalizable measures the business can use to see how collaboration tools are helping the business. The result? As in the previous scenario, the business falls back to the easily observable cost savings.

Forrester has argued that remedying these issues requires content and collaboration professionals to align their technology decisions with the needs of their people, their business's objectives and a scenario-based strategy. We call this POST (People, Objectives, Strategy, Technology), and my colleague Ted Schadler has a great report outlining this methodology. The work now, though, is to understand how the scenarios I've just described are playing out in business and how methods like POST can help these businesses better align their collaboration technology with a collaboration strategy.

Comments

So, what is your hypothesis?

Could be one of three things or a combination of all of them; what is your guess going in?

Also, what is the relationship between a mobile workforce and faster time to market or better innovation?

I think multiple factors could be at play

I don't believe these issues necessarily work in isolation. For example, I think it's possible for an organization to lack a concrete collaboration strategy, purchase collaboration software and watch certain business units pick up the tools. But when it comes time to measure the impact of these tools on the bottom line for the effected units to simply default to the easy measures. But I imagine that patterns will emerge that show, for instance, that the second two scenarios are more likely to show up together than the first and third.

As for the mobility of the workforce, I'm not sure there is a direct relationship between that and the ability of a business to innovate and bring products to market faster. Now, globalization dictates that businesses be able to find talent and resources regardless of their location because it helps with the two concepts you raised. But that argues more for a highly distributed workforce, not necessarily a mobile one.

Thanks for the clarification,

Thanks for the clarification, when you said "why, in a business world where 42% of the workforce is mobile, do just 19% and 9% of content and collaboration professionals see improved innovation and faster time to market" it seemed to imply a relationship between mobility and improved performance.

Ah, I didn't connect the thought

The complete idea there was that considering the fact that over 1/3 of the workforce is working outside the firewall, you need some type of tool(s) to keep them connected and working together. However, we don't see business leaders expressing the value of collaboration tools as providing for the product-related outcomes of these interactions. They instead focus on overhead reducing benefits of collaboration software. And that is what I find puzzling.

Collaboration on process - Social BPM

Great post on collaboration. But sometimes collaboration can be seen through a narrow lens.

Collaboration around the development and improvement business processes (now being called SocialBPM) is being hralded as a new breakthrough.

SocialBPM is not new. The principles are not new. The technoloy is not new. The 'branding' is new and has captured the imagination of BPM bloggers. In the same way that the Cloud has been around for a while as Hosting, ASP or SaaS, but only escaped from IT into the business with its new persona - "Cloud".

Social BPM used to be called collaboration. In fact Nimbus Control has had 'social BPM' since R1.0 14 years ago. Supporting the point in your blog about travel savings; one client justified the purchase of our software on the reduction in travel costs for the process development team alone.

So based on 14 years experience, does collaboration supercharge processes? It certainly gets far more people engaged in process and process change. That supercharges the performance of companies. And that is what matters.

Example: Carphone Warehouse will do an extra $80m of revenue from its 800 UK stores because all staff have accss to a consistent set of processes which were developed collaboratively.
Watch the video to see why/how:
http://www.nimbuspartners.com/nimbus-tv/carphone-warehouse-store

What Does it Cost to Make a Smart Decision?

TJ,

Thanks for tackling this topic. Measuring ROI for new collaboration technologies is a huge challenge because doing so means measuring a starting point for the cost of neurons firing and connecting across the brains of smart people. What does it cost to make an optimal decision if email is your only "collaboration" tool? How do you know the decision or action is as good as it can get? And, when a product slips its ship date, how can you know whether a more social collaboration tool could have created the right "digital water cooler" moments early in the process to eliminate the causalities before they lengthened the critical path? And for the companies using new tools that are aimed at helping us work smarter and faster together, how do you measure the value of the conversation, ideas and better coordinated action that drives faster innovation?

The promise of how we can work together today comes closer to magnifying human potential than anything we've ever had because it's aimed at bringing people together. We're on a whole new level of potential that deserves a new approach to ROI measurement that incorporates the human experience. Namely, use cases. What can people do now they couldn't before? This is the ROI approach we're taking with Novell Vibe Cloud for now because, as you posit, focusing on hard costs does not accurately reflect the value of collaboration software today.

It is obviously true that for

It is obviously true that for each project manager take care of a lot of things like managing the documents, communicating with the team, conducting frequent meetings with the team so as to ensure that every one is updated regarding any recent changes made in the action plan. To manage all of those I am using some tremendous tools. Which are available in www.teamplifier.com

Wikinomics = Mass Collaboration ROI

As anyone who's read Tapscott & Williams' books on micro Wikinomics and Macro Wikinomcs know - the value of mass collaboration is multi-facited. I highly recommend reading just chapter 1 of Wikinomics to see mutiple examples of the value of Open, Peering, Sharring, Globally http://www.wikinomics.com/book/IntroAndOne.pdf

I suggest the number one "cost" driver of mass collaboration is labor followed by reduced IT CapEx - whereas the number one "revenue" driver is innovation of products and services (including bundled services) followed by speed to market and then risk reduction.

VR/

Michael Wm. Denis
Principal, Aviation Wikinomics, Inc.