A Frost & Sullivan White Paper. Partnering with clients to create innovative growth strategies

Transcription

1 L E V E R AG I N G T H E VA L U E O F U N I F I E D C O M M U N I CAT I O N S A White Paper Partnering with clients to create innovative growth strategies

2 TABLE OF CONTENTS TABLE OF CONTENTS Executive Summary 3 Unified Communications: The Personalization of Collaboration 4 Business Drivers 4 Technology Drivers 6 The Human Element: The Value of PC-based Video Conferencing 7 Video-enabled Business Processes 8 Making it Work in the Virtual Workplace 8 Video Drives UC at the Desktop 9 Motivates End Users to Leverage IP Telephony 9 Delivering Communications on the Desktop 10 Closes the Relationship Gap for Distributed Workers 10 Dynamic, Software-Based Integrated Network Management 11 Software-Enabled Video Conferencing: Delivering ROI 12 Conclusion 14 2

3 EXECUTIVE SUMMARY More and more companies are realizing that to stay competitive in today s increasingly global marketplace, they must support a virtual workplace in which distributed employees can collaborate, quickly and easily, regardless of where they re located. New technologies, including unified communications (UC), are helping these organizations support their employees, partners and even key customers. Now, forward-thinking businesses are looking for ways to integrate their UC applications into business processes, to speed transactions and enable quick and informed decision making. But many such organizations forget two critical components of those very same business processes: the human element that s so important to successful business communications on the front end; and the management of the associated infrastructure on the back end. When integrated into business processes, video enabling unified communications at the desktop ensures that the human element doesn t get lost as companies go virtual. With most business processes, certain steps require a personal connection for anything meaningful to occur and nothing delivers that experience as well as desktop video conferencing, which allows participants to see facial expressions and body language, as well as make eye contact and get a true feel for the person they re working with. Confusion is minimized, and better decisions are made, faster. Furthermore, desktop video conferencing encourages employees to get comfortable using their PCs as a point of enterprise communications. While many employees are reluctant to give up a hard phone for a soft one, once they grow accustomed to having video on their desktop, they re much more likely to launch other forms of unified communications from the same place including simple point-to-point voice calls. This can be a boon for companies that want to migrate employees to an entirely software-based IP telephony system and other unified communications applications. Still, even as companies begin to deploy unified communications, they often neglect to consider a critical element in the implementation: network management and performance. Real-time communications require an always-on, scalable network; desktop video conferencing increases this need, because as more people use the software more often, bandwidth usage rises accordingly. The good news is, with the right management tools in place, the increased usage can deliver better ROI without putting a strain on IT resources or personnel. This whitepaper explores the value of unified communications and PC-based video conferencing as a means to enhance and in some cases, enable business processes at key junctures along the way; outlines how companies can leverage that capability to expand the use of all IP-based communications in the enterprise; and demonstrates the need for underlying network management and support. It also discusses the return on investment such technologies can, and should, deliver. 3

4 UNIFIED COMMUNICATIONS: THE PERSONALIZATION OF COMMUNICATIONS The past year has seen a dramatic increase in the need and desire for unified communications, which personalize collaboration for end users. The goal is to deliver anytime, anywhere communications that allow employees to find the right people at the right time, then communicate and collaborate with them in the most efficient and effective way possible all while saving employees time and their companies money. (Please see Figure 1.) There are several drivers for unified communications, and several challenges created by them, as well. Figure 1: The Unified Communications Infrastructure IM Presence Shared Workspaces 3 rd Party Apps Integration VoIP Unified Messaging Data Video Voice Scheduling Calendaring Productivity Software Business Process Integration Business Drivers Collaboration in a Heterogeneous World Today s companies are experiencing significant changes in how they and their employees do business. The workplace is becoming increasingly virtual, as employees are located in places that are different from their co-workers, managers and direct reports. And yet, the workplace is also becoming increasingly collaborative, as companies realize that their real value lies in their employees, rather than in the products and services they sell. 4

5 More and more, businesses must enter new regional, national, and even global markets in order to compete. At the same time, they want to recruit and keep the best talent available, without having to open offices wherever those talented people may be or requiring them to move to a corporate location, since the best and the brightest are increasingly reluctant to uproot their families and lifestyles simply for a new job. Meanwhile, the global marketplace requires more collaboration among employees, as well as partners, suppliers and even customers. Having the right information at exactly the right time can mean the difference between a closed deal and a lost one; knowledge sharing can make the difference between a leading company and one that follows. But when co-workers aren t located in the same office, getting that level of collaboration can be a challenge one that companies must overcome to achieve success. As companies go global, therefore, they require homogenous communications within an increasingly heterogeneous world communications that integrate employees, clients, partners, prospects, and suppliers. And while the need for collaboration hasn t changed, the need to collaborate across geographic and cultural boundaries, in different languages, and among constituents with a variety of viewpoints and goals has certainly increased. As a result, companies must give employees technology that can bridge the gaps among various participants. Only video-enabled unified communications allows people to meet on the fly, whenever they need to and from anywhere, while also being able to see each other s facial expressions and body language. That s especially important when meetings involve participants from different cultures and speaking different languages, since visual cues keep the speakers intentions from getting lost in translation. And it s also important when meetings involve participants with different interests in the outcome (partners, customers, etc.), since there s no better way to read those interests than by seeing them telegraphed on screen. Communications Enabled Business Processes One of the advantages attached to unified communications is communications-enabled business processes, or CEBP. The idea is simple: By integrating unified communications into a business process, companies can cut the time it takes to complete that process and thereby boost productivity, cut cycle and decision times, or both. For as long as companies have had business processes (i.e., forever), they ve been trying to make those processes as effective and efficient as possible. In most cases, that means streamlining the process to ensure the event is accomplished in as little time, and for as little cost, as possible. Embedding communications into business processes can make them more efficient by ensuring that the right steps are taken at the right time, reducing latency especially around decision making. For example, if a new-order process requires sign-off from a 5

6 manager, a system that communicates with that manager to let her know her sign-off is needed, and enables her to give it on the fly, will allow the process to flow without having to wait for her to check her order system to see what requests are in the queue. That cuts time often hours or even days from the process. Because they are presence-based and very interactive, unified communications lend themselves well to CEBP even more so than basic alerts have in years past. With UC, alerts can go out to the right people at the right time, based on their availability to respond or take action; and they can be delivered via the most appropriate method for the situation. Technology Drivers The resulting gap has lead to the need for unified communications technologies, which make it easy for employees to click to collaborate. Tools including IM, persistent chat, presence information, audio and web conferencing, voice over IP (VoIP) and PC-based, or desktop, presence-aware video conferencing ensure that end users can reach exactly the right person at the right time, getting the information they need immediately. That leads to better, more targeted and more timely collaboration, which in turn leads to better productivity and ultimately has a positive impact on the bottom line. (Please see Figure 2.) Figure 2: The Business Value of Communications Tools 6

7 There are three key points to Figure 2: Success will be based on maximizing value from large numbers of distributed employees across multiple locations and geographies. The combination of historically competitive technologies form a unified communications desktop that include video, voice and data. The result is faster decision making, idea or product propagation; staff mobility; and pro-active business management all delivering significant competitive advantage. Desktop video conferencing can and should play a significant role in any unified communications implementation. While many organizations recognize the value of roombased video conferencing, such solutions don t deliver value to all employees; indeed, in many cases, they are available to only the small percentage of employees who happen to be located in the same place as the video conferencing system. But as the number of remote and virtual employees increases, the number of people needing access to simple, cost-effective video conferencing solutions is also increasing not just because more people are located away from the traditional room-based systems, but because those very same people are the ones most in need of communications tools with which to connect and collaborate. Desktop video conferencing is available to all employees who have a PC and a network connection. They don t need T1 access or special endpoints, and they don t need IT support to make the system work. With a simple click of the mouse, users can get all the benefits of in-person visual communications: eye contact, body language cues, and the increased comfort, camaraderie and respect that come from interacting face to face. THE HUMAN ELEMENT: THE VALUE OF PC-BASED VIDEO CONFERENCING There are many drivers for video collaboration and real-time communications in the enterprise. Often they re connected, so that as one increases, so do the rest. First and foremost, the world is getting smaller, and today s organizations are increasingly global as they expand their customer reach, work with partners and suppliers around the world, and support employees in a variety of geographic regions. But the resulting virtual workers must still communicate with one another. Clearly, one way to do that is through travel. But as the hard-dollar costs of air and ground travel increase, organizations are looking to cut those expenses. Furthermore, managers are realizing that the so-called soft costs of travel have an even greater impact on the company s bottom line. As employees are forced to spend hours and days away from the office, their productivity plummets. Even when they finally return to their desks, they spend more time catching up on s, voic s and other housekeeping business; hours can go by before they are ready to tackle productive work, to say nothing of the wear-and-tear toll that travel takes. Companies also are paying close attention to their carbon footprints, and are looking for ways to minimize their environmental impact wherever possible. CXO CHALLENGES The challenge for CXOs is to take advantage of new, personalized communications and collaboration technologies while keeping costs down and usage up. Many executives today find they are dealing with several critical issues, including: Leveraging their IP networks. After spending hundreds of thousands or even millions of dollars on an IP network to support voice over IP, executives are looking for ways to get more value out of their investment, faster. Connecting remote and virtual employees. Companies must keep their far-flung employees connected as many as 95% of managers report that doing so is their number-one business challenge today. Extending communications and collaboration to people outside the enterprise. More and more organizations are seeing value in working closely with partners and suppliers throughout the business process. And many organizations are also finding that working closely with customers isn t just good business it s critical to keeping those customers loyal. Supporting the nextgeneration technologies their employees use successfully at home. As the younger generation enters the workplace, they expect to have and use the kinds of technologies they ve grown up with, and which they already rely on for successful collaboration. These include VoIP, IM and video conferencing. 7

8 Technology that lets employees collaborate face-to-face without actually being face-toface can facilitate virtual collaboration easily and very cost-effectively. PC-based video conferencing software is that technology. It helps companies transcend geographic barriers and improve cultural effectiveness; make communications clearer by capturing facial expressions and body language; shrink decision making and cycle times; boost productivity; and reduce their carbon footprints. Video-Enabled Business Processes For all its value, there has traditionally been a drawback to CEBP it ignores the human element in many business processes. The reality is that many business decisions are made not by a single person, but are rather the result of a collaborative effort on the part of multiple parties employees, partners, and in some cases even customers. Alerts and oneclick actions have their place and can certainly serve to cut latency in the decision-making process, but they don t capture the need for multiple people to weigh in. PC-based video conferencing eliminates that problem by allowing companies to make a visual communication session an integrated, and integral, part of select business processes. Rather than simply receiving an or IM alert, and then taking solitary action, involved parties can join an ad-hoc meeting to participate in a single or multiparty video conferencing session when pre-defined triggers are reached. That ensures all necessary participants are able to meet and discuss elements of a process as soon as possible, right at their desks, and in an efficient and cost-effective manner. If the process is complex or has encountered trouble, video discussions add an element of understanding that takes the communication to the next level in many cases, a necessary part of the process. Ensuring the human element is not lost ensures the right steps are taken as soon as they are needed. Making it Work in the Virtual Workplace It s especially critical to be aware of the need for human contact and interaction in the virtual workplace. Time was ten, five, even one or two years ago when you could simply walk down the hall or across the corporate campus to reach a colleague live and in person, and collaborate on an intimate level. But in the virtual workplace, such interactions are harder to come by, if they happen at all. And yet the need for such faceto-face exchanges hasn t gone away; if anything, it s greater than ever. PC-based video conferencing makes it possible for such ad hoc encounters to occur, and by embedding video into business processes, companies can ensure employees, partners and customers interact face-to-face at exactly the right time. That leads to a better, more effective encounter, which in turn cuts the time it takes for decisions to be made (and makes it less likely those decisions will be questioned down the road). Increased productivity and performance will follow not just for the people involved, but for the processes, too, because better decisions lead to better business. 8

9 VIDEO DRIVES UC AT THE DESKTOP After several years of false starts, companies are finally embracing voice over IP (VoIP). Many IT departments are deploying the technology in pilot projects and/or to specific departments within the organization; others are taking pains to ensure any Greenfield applications are 100% VoIP; and a few hearty thought-leaders are taking the necessary steps to roll out VoIP company wide over the next several months and years. Voice over IP delivers several benefits, most especially cost savings. But companies that make VoIP a part of a larger unified communications effort can see more than just harddollar gains; they can also expect to increase employee productivity and support the virtual workplace. Still, the technologies require more than just executive-level buy-in and IT support; they require changes on the part of end users, too. PC-based video conferencing can help drive those changes, ensuring companies get the most out of their UC dollars. Motivates End Users to Leverage IP Telephony IT managers no longer have to defend their deployment of IP networks if anything, they have to defend the decision not to deploy IP telephony. The technology works, it can save companies money and simplify management, and it makes it easier to integrate unified communications tools, including presence, video and web conferencing. (Please see Figure 3.) PC-based video enabled unified communications software encourages employees to take advantage of their company s IP network, which helps companies justify their expense, and allows them to better leverage the technology. That can lead to a much faster ROI, since running more than just voice over the network ensures it will see more use, more often and that positively influences the bottom line. Figure 3: Videoconferencing Services Market: Percent of Video Calls by Network Type (U.S.),

10 That increased use can also help IT managers and other constituents get sign off to roll out IPT to other areas of the organization beyond their initial pilot projects, for instance. When managers can show that the benefits of an IP network go beyond telephony and support a variety of communications applications, they can see significant increases in the support they get from other departments and executives who might not have initially embraced the new technologies. Delivering Communications on the Desktop One of the key changes required by voice over IP and unified communications technologies is a shift from device (desk phone, cell phone, video endpoint) to software on the desktop. The goal is to give employees all the communications tools they need right on their PCs, so that they can literally click to communicate with one another, as well as partners and customers. But most of us are not inherently familiar with communicating over our computers; even those of us who use VoIP routinely do so using a hard phone, rather than a PC-based soft phone. Unified communications requires that we get over that hump, and PC-based video can help us do that. Because it makes video conferencing easier to use, more convenient and in most cases more cost effective than room-based video systems, desktop video conferencing has the power to transform video conferencing for end users making it a tool they want to leverage rather than avoid. That has benefits for the enterprise in general, but it also helps move end users to the PC for all their communications: Since they re already using it to communicate visually, it s an easy leap to using it for a voice call or Web collaboration session. And that can help companies see a better return on their IP-network investment. Closes the Relationship Gap for Distributed Workers Unified communications is valuable for everyone, but it is especially critical for distributed workers who must connect and collaborate with other distributed employees. These employees and their companies glean many benefits from being able to work from anywhere, but they simply cannot do their jobs if they can t connect with one another on an intimate level and PC-based video conferencing allows them to do that. Desktop video conferencing lets employees meet whenever they need to, without advance planning or reserving time on the system. That allows them to collaborate whenever they need to, with whomever they need to, and from wherever they happen to be. And because desktop conferencing looks and feels like any other software application, employees can use the technology without the help of IT, or the need for a conferencing scheduling system or a live operator. That ensures video collaboration sessions can happen on the fly whenever necessary. (Of course, they can always be planned in advance, and scheduled using any common calendaring application.) 10

11 Once they ve launched the session, participants can experience all the benefits of unified communications, including being able to use single or multi-party voice, chat, and data collaboration along with video to see facial expressions, body language and other visual cues that let people interpret the meaning behind the message. As a result, information is shared more effectively; understanding is more common; and remote teams develop a rapport and level of trust previously available only to co-located employees. Taken together, the advantages of PC-based video conferencing allow organizations to support the virtual workplace they so badly need in order to stay competitive in today s global marketplace, without sacrificing any of the benefits of having everyone located in the same place. Bringing these capabilities to the desktop simply ensures those advantages are available to all employees who need them, even if they re not able to access a roombased video conferencing system. DYNAMIC, SOFTWARE-BASED INTEGRATED NETWORK MANAGEMENT In the virtual workplace, the network is the business. If your network is down or can t scale, your employees can t communicate. One of the biggest concerns IT managers have when it comes to deploying unified communications and PC-based video applications is that they won t be able to manage the related bandwidth, scalability and performance requirements. But with the right software, they can handle the challenge, and derive all the benefits unified communications deliver. For organizations to confidently deploy unified communications as an enterprise technology, they must be assured that all users can access the system, and that the communications traffic will not overwhelm portions of their networks. Indeed, the key to any successful unified communications deployment, especially one that includes PC-based video conferencing, is the management of the increased pressure on the network being able to manage the quality of the communications experience end to end. Modifying the network topology and associated infrastructure to accommodate expanding bandwidth requirements is particularly difficult as the number of mobile workers increases. Conventional wisdom states that deploying voice and video on IP networks requires significant investments in network technologies, specifically in the areas of QoS, policybased routing and reservation protocols. Network companies are investing heavily in making their networks more application-aware, with the goal of providing better service quality on these networks. But another way to deliver a high-quality experience to the end user is by putting all the intelligence in the software, so that it can adapt to whatever underlying network conditions occur at any given time. That can save companies time and money, and free their IT staffs to focus on more strategic initiatives. It also allows companies to be vendor-agnostic when it comes time to upgrade their network infrastructure. 11

12 The software-based approach puts the intelligence directly in all components of the application, including the endpoints, the servers and the infrastructure. This results in socalled network-aware software applications, which can be better positioned to ensure a high quality end-user experience than software-applications that rely on application-aware networks. And they can do it while saving companies significant sums in hardware upgrades and their associated implementation costs. Software-based network management also enables all kinds of communications applications, as well as CEPB, so the value goes well beyond PC-based video conferencing. Because effective network management allows organizations to offer more communications over their network, they can better support a distributed workforce, allowing them to communicate effectively with others both inside and outside the organization. That, in turn, allows them to extend their ecosystem and brand reach. Finally, because it supports that distributed workforce, effective network management also reduces the cost of corporate operations; for instance, companies can see significant savings in office real estate costs. SOFTWARE-ENABLED VIDEO CONFERENCING: DELIVERING ROI As a general rule, PC-based video conferencing offers companies an excellent return on investment; typical pay-back can take months, not years, and it s not unusual to see even shorter ROI times in some cases, even as short as a single meeting, depending on how many people are attending, and how far they would have had to travel to be there in person. Most companies do their initial ROI calculations simply by calculating the savings in travel costs that result from replacing live, in-person meetings with PC-based video conferences. If companies typically spend $1,200 per employee on travel-related costs (including all transportation, hotel and meals), the savings can quickly add up. For instance, a mid-size organization with 1,000 employees would spend about $225,000 on desktop video conferencing software from Avistar. Considering that a single team meeting among four participants could easily cost $5,000, that s an ROI of about 45 meetings company-wide. Factor in maintenance costs of about $40,500 per year, and all a company needs to do is replace a dozen team meetings with a video conference every 12 months to see ongoing ROI. But companies can take the ROI calculation a step further if they consider how much more productive desktop video conferencing allows their employees to be. By integrating video into business processes, for example, companies can help those processes go faster and more smoothly; by allowing employees to regularly meet face-to-face, regardless of where they re located, companies ensure their virtual workers are as effective as their office-based colleagues. 12

13 For instance, Avistar reports that its software helps customers act more quickly and reduce business process cycle times by up to 90% by putting team members and decision makers together anytime, any place, face-to-face thereby reducing serial business processes and long chains of impersonal and ineffective messages. One customer saw savings of more that $185,000 by reducing time to market: 8 months x 21.3 working days per month = working days / 25 new products to be introduced = 6.82 days per product Avistar Impact: 1.82 days improvement x $1 million contribution per product / 245 working days x 25 products = $185,714 Cycle Time Savings Furthermore, because they spend significant resources to deploy voice over IP (as much $1,000 per employee, or more), companies are looking for ways to leverage their IP networks. One very good way to do that is through desktop video conferencing, which costs significantly less over an IP network than over a traditional ISDN line, and which can also take advantage of the management and control capabilities such a network delivers, simply and easily, to IT. Once the software is paid for, on an IP network, the costs of running a video conference are effectively free, barring the occasional maintenance and technical support. That s especially important when companies want the technology to scale. Although few companies have deployed desktop video conferencing to all their employees, those that have report significant usage rates. One Fortune 100 financial services firm has deployed around 4,000 seats of Avistar s presence-based desktop video conferencing and books more than 1.5 million minutes of use per month. Another Fortune 100 company has seen so much success from its pilot project, it recently opted to add another 2,000 seats, which, interestingly, it s paying for out of the company s T&E budget. Both companies, of course, need a bullet-proof IP network that keeps operational costs low. Finally, when considering ROI, it s important for companies to evaluate how they want the software delivered as an on premise solution or as a hosted service. For many companies, the value of software as a service is clear: They can focus on their core business competencies, and outsource their IT. That works especially nicely with video conferencing, since it s meant to be a tool that let s employees focus on the business, and not their communications technology. (Please see Figure 5.) 13

14 Figure 5: On Premise Software vs. Hosted Services Advantages Disadvantages Software Cost Efficient and Long term ROI Better Control and Security Better Integration with Existing Programs and Applications Unlimited Usage and Penetration Promotes Consistency throughout the Organization Requires Upfront Investment Requires Internal IT Staff Support and Management Limited Reach Outside the Network Difficult to Monitor Usage Costs Associated with Upgrades Services No Upfront Investment Easy to Deploy and Manage Flexibility - Enables use of multiple solutions and pay-per use for infrequent users Frees Up IT Staff If the Technology does not catch on, you have nothing to Lose Costly at High Usage Levels Less Security and Controls Overage Charges can Add up Limited Integration with Enterprise Applications Promotes Infrequent Usage CONCLUSION As companies move to an increasingly virtual workplace, they are looking for technology that will support that effort and fit into a larger unified communications infrastructure. Presence-aware PC-based video conferencing can help answer the call. It s cost effective, easy to use, and delivers all the benefits of visual communications to employees at all levels of the organization, wherever they are and whenever they need it. Those benefits include instant access to video conferencing; face-to-face engagements that ensure better understanding on the part of participants; and the ability to make critical decisions faster. Taken together, that s more than just a boon for virtual organizations it s a requirement if they are to stay competitive in an increasingly global world. When integrated into business processes, video enabling unified communications at the desktop ensures that companies keep communications human even as they go virtual. And because desktop video conferencing encourages employees to get comfortable using their PCs as a point of enterprise communications, desktop video can support and enable a company s broader UC efforts. Of course, real-time communications require an alwayson, scalable network which means companies must pay close attention to network management as they deploy unified communications. But with proper management and performance metrics in place, desktop video conferencing can deliver remarkable ROI without putting a strain on IT resources or personnel. 14

15 Silicon Valley 2400 Geng Road, Suite 201 Palo Alto, CA Tel Fax San Antonio 7550 West Interstate 10, Suite 400, San Antonio, Texas Tel Fax CONTACT US London 4, Grosvenor Gardens, London SWIW ODH,UK Tel 44(0) Fax 44(0) Palo Alto New York 877.GoFrost San Antonio Toronto Buenos Aires Sao Paulo London Oxford Frankfurt Paris Israel Beijing Chennai Kuala Lumpur Mumbai Shanghai Singapore Sydney Tokyo ABOUT FROST & SULLIVAN, the Growth Consulting Company, partners with clients to accelerate their growth. The company's Growth Partnership Services, Growth Consulting and Career Best Practices empower clients to create a growth focused culture that generates, evaluates and implements effective growth strategies. employs over 45 years of experience in partnering with Global 1000 companies, emerging businesses and the investment community from more than 30 offices on six continents. For more information about s Growth Partnerships, visit