Collaboration is not a new phenomenon. Man, often called “the social animal,” has been leading a cooperative life since time immemorial. The notion of enterprise collaboration, however, can be traced back to the 1980s, when tools such as word processors and spreadsheets entered the corporate world. With advancement in information technology, these individual productivity tools have given rise to team productivity tools such as emails, wikis, blogs, and remote conferencing.
At Oracle, our definition of enterprise collaboration incorporates not only these tools, but also a new breed of innovative technologies that allows knowledge workers to work across the extended enterprise—securely and seamlessly. In this new paradigm, a knowledge worker can quickly identify a colleague in another part of the organization, or indeed the world, who might have the requisite information and expertise to help. Imagine, for instance, two drug researchers, working on completely different diseases in two corners of the world, discovering one another and perhaps joining forces just as each starts investigating a particular receptor on a given molecule. Such seamless “intelligent collaboration” is the exception rather than the rule in today’s business world. Enabling such interactions, however, is a key element of Oracle’s vision for enterprise collaboration, which is fittingly defined as a process in which the right people connect with the right expertise or information at the right time, to drive the right business decision securely and confidentially.
In today’s competitive environment, enterprise collaboration is at once a key strategic challenge and a tremendous benefit driver for companies across industries. Companies on the leading edge of the collaboration revolution have already started to achieve a range of benefits, such as accelerated pace of product launches, early detection of changing customer preferences, improved product quality, enhanced market responsiveness, and stronger supplier, employee and customer loyalty.
Trends Four major trends are propelling enterprise collaboration to the top of the corporate agenda. They are:
1. Ever-expanding globalization. For example, the iPod’s music chip is developed in India, the product is manufactured in China leveraging subcontractors in Taiwan, and it is then marketed and sold in the U.S. and elsewhere.
2. The increased specialization of knowledge-based work. For example, the U.S. now enrolls as many specialist residents as general practitioners (whereas, in the past, the generalists significantly outnumbered the specialists); increasingly, consulting firms are organized around industry verticals; and NFI Research finds organizations “favor specialists over generalists.”
3. The accelerated pace of innovation, which increasingly relies on collaborative culture and partnerships. For example, Procter & Gamble uses a program called “Connect and Develop” to drive innovation through increased collaboration with external partners.
4. The rise of the virtual work environment. For example, an SDL survey found that 59 percent of employees considered their team “geographically dispersed.”
All these trends lead to increased fragmentation and/or dispersion of information and expertise and, therefore, an increased need for the right interactions to happen at the right time to ensure organizational success.
Challenges While the above trends make enterprise collaboration increasingly important to corporations worldwide, companies must address two key obstacles if they are to succeed in driving value from these well-advised capabilities.
First, as with any major technology investment, success depends as much on addressing key cultural issues as on having the right technology. For example, at one large multinational, we found that employees routinely avoided helping others because they saw it as a threat to their own career advancement. In some cases, employees did not want to receive help from others because they believed pitching their own idea ensured that they would not need to share the spotlight with others. Such a competitive environment is clearly counterproductive. This is where strong executive sponsorship, proper governance structure, and incentive alignment are critical. In this same company, a new CEO has made enterprise collaboration a top organizational priority, and has created an environment that empowers (via global knowledge management systems and corporate blogs) and rewards (through the celebration of “share and reuse” efforts) collaboration.
Second, companies must address the data and expertise issues that form the basis for collaboration. An IDC report estimates that the world’s data is exploding at a dizzying rate of 60 percent per year; while a Gartner study indicates that over 70 percent of the information is unstructured and unmanaged. Not surprisingly, only 50 percent or less of all corporate searches by the typical knowledge worker are actually successful. Without a well-conceived strategy, data will remain unmanaged and inaccessible, and the expertise hidden and untapped.
Capabilities To address these challenges, companies must enable two distinct capabilities:
The ability to connect with the right expertise, i.e., making the right connections—even those that one may not have a priori knowledge of—quickly and easily. For example, a brand manager in the U.K. might securely and even anonymously learn about a colleague in Singapore who has worked with a designer at an ODM (Original Design Manufacturer) in Taiwan, who might just help her develop a new product that meets the changing customer needs in the U.S. market.
The ability to connect with the right information, i.e., securely exchanging or reusing ideas and information that enable faster and better decision making. For example, AstraZeneca uses a centralized image repository that enables rapid access to information to authorized users, using a system that is as robust and scalable as its clinical data management system.
Value These capabilities, which enable employees to discover and access the right expertise or information at the right time using secure and robust infrastructure, are clearly essential to a company’s ability to create and sustain competitive advantage in the long term. They can also drive substantial financial benefits in the short term. For example, one large communications multinational reported saving $691 million in 2009 by following a repeatable, enterprise-wide collaboration framework based on Web 2.0 and social networking technologies. Likewise, another large energy company halved the number of days it took to fix an out-of-commission oil well, primarily because the well engineers were able to tap into their newly-created extended network to identify an expert who previously had no relationship to the well. In an industry such as this, where the fixed costs are quite high, avoiding such down days are critically important and significantly accretive to the bottom line.
As the above examples illustrate, specific benefit drivers and the magnitude of benefits are likely to vary from industry to industry and process to process. For instance, enterprise collaboration in the pharmaceutical industry might lead to increased research and development efficiency, while in the consumer electronics field it might enable faster launches. Regardless of the industry and the process, however, one thing is certain: Enterprise collaboration has come of age, and companies must embrace it or risk being left behind.
Sushil Panta is Sr. Director, Industry Strategy & Insight at Oracle.