Following on from my blog just before Christmas on the cost savings of using Networker, a recently new customer has shared some of their experiences.
''Regarding the success of today’s NetWorker meeting for 20 people: Normally 6 people would have had to come here for the meeting and charge expenses for car use and parking circa £125. We are having another one next week so that will make at least £250 each we've saved in two weeks in out of pocket expenses plus approx 18- 20 hours lost productive time travelling, plus reduced carbon footprint. Even the most vociferous of critics now admit NetWorker is worth weight in gold this winter with weather issues and these savings.''
This real life example crystallises for us the immediate business benefits a SaaS based collaboration tool can have and has already saved each user more than twice the annual subscription fee on travelling to these two meetings alone.
The weather over the past two weeks in the UK has been pretty dreadful with much of the transport system closed down and many people finding themselves snow bound at home. For many this has meant resorting to the mobile phone and e-mail to try to continue business.
For one of our newer customers though they were surprised to discover the power of being able to log into Networker from their home PC and be instantly connected to their office community. Presence meant they could see who was 'in' and available. Many meetings still went ahead simply transformed into audio conferences or e-meetings. For this particular customer, use of the public internet or e-mail for sending confidential files is prohibited so they were delighted to find the embedded encrypted secure file transfer capability which enabled them to keep their business moving.
Its not often that businesses are denied access to their offices through fire or flood so smaller groups tend to forget their business continuity planning. However Networker has shown how it supports home working and how it's possible to run a business effectively when everyone has to work remotely.
Now the problem I had was we lost all power at home for 28 hours due to the heavy snow fall bending over trees which snapped the power lines . I had no PC or broadband router and the mobile went dead after 6 hours. This meant I had no alternative but to go outside and play in the snow ! Note to Product Management: Should we offer standby generators as a Networker Homeworker 'Option' ?
For a busy sales executive, saving 4 typical car journeys and 2 train journeys a month, along with a trip to Europe every 2 months, saves the business the equivalent of £15,000/yr, and saves him an average of 19 hours of travelling time a month.
The UK’s Committee on Climate Change reported this week on the environmental impact of a 3rd runway at London Heathrow. In the report they expressed an expectation that teleconferencing will significantly reduce the need for business travel. This is yet further recognition of the impact collaboration applications will have on travel, saving money and reducing the carbon footprint of businesses.
A successful executive needs to meet people to do business and no collaboration service, no matter how good or widely available, is going to reduce business travel to zero. Technology does though change the dynamics of business relationships, significantly reducing the need to travel and also increasing productivity.
Higher productivity comes not just from saved executive travelling time but by enabling executives to ‘meet’ and talk with more customers, suppliers or colleagues than is possible in a day by travelling. Meetings in Frankfurt, London, New York and again in Frankfurt, all in one day? Unlikely, other than by business collaboration and teleconferencing technology.
So can you quantify the business benefit - and is it significant ?
The Costs Today
We have to firstly establish an average travelling pattern for our executive. No two meetings or people are the same. Some travel extensively by air, some drive and some let the train take the strain. We have to therefore develop some base numbers and flex a cost model accordingly.
By Car
Your average executive car costs around 45p/mile (according to the UK tax man). Most would probably agree its closer to 60p/mile. So for a trip to see a customer 50 miles away the costs of transport alone ranges between £45 and £60.
In addition we have our executives’ time. At an average speed of 40 mph our executive will have 2.5 hours in his car (probably most of the time on the mobile phone but lets ignore that cost). 2.5 hours will cost around £70 for an executive on £50k/yr.
So the overall cost of driving to the meeting 50 miles away is a minimum of £125.
Train
The alternative is the train. A 200 mile round trip, say Bristol to London, for a meeting has a ticket price ranging from £95 to £153 depending time of day and class of travel. Average travelling time is lower than the car being 3 hrs return, costing us £84 in executive time.
So the total cost for this trip ranges from £179 - £327. Lets say £250 for simplicity.
and Plane
If however the meeting was in Paris, flying would probably be the chosen transport. A crush-class flight from London to Paris on a scheduled airline will cost around £230 return. Travelling time is around 6 hours allowing for check-in, security and flight time. Assuming the executive also drives to the airport (20 miles) plus parking for the day costs rise to around £460. Add in taxis in Paris and we’re close to £500 for the day. This assumes the meeting lasts all day so there’s no in-effective time and is reasonably close to Paris airport.
So to summarise, a 100 mile round trip by car costs £125, a 200 mile trip on the train around £250, and the same by plane £500.
The Savings We have to make some assumptions about travel patterns that reflect the average worker for any company, which varies between highly mobile sales people, project managers, procurement and supply side management, multi-site functional managers and the CXO traveller. Each business will therefore have a different profile and would need to develop possible saving targets for each type of role.
Lets assume though that our executive is in Sales and travels three times a week to customers in his car, once a week into London and into Europe once a month. This would mean he drives around 15,000 business miles a year.
With effective collaboration technology we should be aiming to reduce his car trips to customers by one a week. Reduce by half travel to London on the train, and reduce his trips to Europe also by half. Saving are therefore 4 car journeys/ month, 2 train journeys a month, and half a trip to Europe.
This saves around £1250 a month, £15,000/yr, or 30% of his base salary.
This ignores how he now puts to use the 19 hours a month of travelling time saved - hopefully talking to more customers.
The Costs of SaaS Collaboration Deploying an enterprise wide business collaboration application can be an expensive undertaking if the traditional deployed approach is used. However with Software-as-a-Service now accepted as reliable and securethis would be the most cost effective route and fastest to deploy for most businesses. One has to remember that the PSTN is effectively a SaaS application. A simple subscription on a per seat/month basis covers all licensing, operations, support and on-going development costs. A fully featured business collaboration product should be costing less than £20 per seat per month, including VOIP and mobile client options.
The Green Case There’s a compelling sustainability aspect to SaaS solutions which give them outstanding green credentials. Most SaaS applications run in existing internet browser or a thin Java client. This means there’s no need to renew PC’s, upgrade hardware, operating system or expensive Office applications, so extending the life of existing infra structure whilst getting the latest unified communications and business collaboration application.
Carbon emissions from business travel makes up 4% of the emissions from the National Health Service, Europe’s largest employer. Of the 18 million tonnes/yr of carbon emissions they are responsible for, a total of 740,000 tonnes/yr is due to business travel.
Carbon calculators enable you to define the emissions for the trip profiles we developed above. These equate to 0.025 tonnes for the car journey, 0.02 tonnes for the train, and 0.39 tonnes for the airplane.
The average NHS employee probably doesn’t fly on business trips, so cutting the NHS carbon footprint for business travel would require savings from car and train travel alone. Setting a target of a 10% cut would require a saving of 74,000 tonnes/yr – equivalent to nearly 3 million car journeys or 3.7 million train tickets.
However, the NHS is huge, employing 1.5million staff. If we assumed only 10% travel regularly, this is still 150,000 staff - so each does not have to change their behaviour significantly to hit the savings target.
If these150,000 regular travellers reduced their business travel by just 2 car trips a month, the NHS would cut 90,000 tonnes/yr of emissions – a 12% saving on today’s figure.
Could a business collaboration tool help achieve that ? Very probably.
And the direct cost savings of achieving that small level of travel reduction for the NHS ?
I was fortunate to be invited to the Cloud 9 conference in London this week. One of the most interesting discussions on stage was the changes CIO's saw in their IT departments as cloud computing was adopted. This got me thinking, can clouds really change lemons into butterflies ? Let me explain.
It was suggested that today the majority of an IT departments resources, people and capital, are dedicated to 'keeping-the-lights-on' operations. Maintaining hardware, servers, disks, data centre networks, supporting desktop applications like e-mail, upgrading windows servers and supporting users with configuration issues.
Activities which enable the business to move forward, change and innovate, are given much less focus than ideal. There's always a conflict between business-as-usual and ''new stuff''. So rolling out CRM, ERP, or the latest business application becomes a slow and painful process, with many learning points as they go. And with each and every additional application delivered the complexity and cost of supporting it, grows. Its a situation many say is unsustainable and cannot scale.
One way to represent that is using a Venn type diagram - which, oh, looks like a lemon.
Cloud computing and SaaS of course moves the operation and support of an application outside the Enterprise. Servers, databases, storage, can all be moved out into the cloud where the operators scale can bring efficiencies in application development and operational platforms.
This gives the Enterprise IT department more resources to focus on deploying the new apps the business has been crying out for and the data to enable them to manage it better: - timely, accurate, relevant data...
The process of deploying new applications can now get the attention it deserves and users the support they need to adapt to new processes. Suddenly IT is an agile and responsive team in the vanguard of change solving business problems, not closeted engineers. A team who can now also drive innovation maybe in the form of new products and services the company can sell, or customer service initiatives.
This transformation means our diagram takes on a new form.
So maybe clouds can really change lemons into butterflies.....
We stand at a transition point in business. As the global economy starts to work it’s way out of recession CEO’s and management teams around the world are beginning to plan for growth. But they won’t do that by simply taking back into their businesses the bottom line costs they just spent 18 painful months getting rid of. The enlightened are looking for a new ways of working, how to unlock the people power in their organisation in a secure and focussed manner, to accelerate speed of decision making, reduce costs, and drive productivity.
Technology has been at the centre of social and industrial change since the printing press. Through history there have been transition points. The invention of the flying shuttle by John Kay heralded the start of the industrial revolution. The spread of democracy around the world can be traced to the invention of the telephone by Graham Bell and its adoption around the world. Suddenly totalitarian states could no longer constrain the flow of people’s ideas, information, and aspirations.
More recently mobile devices and the internet has accelerated the flow of information with images and video, so now international public opinion can be formed and galvanised by what were once isolated events. The video of student Neda Agha-Soltan’s shooting in Iran caught on a mobile phone started an outcry around the world which is still vocal today.
Social networking has become the norm for many who ‘tweet’ their way through the day sharing thoughts on everything, from the mildly interesting to the creative. The need to communicate is infectious and has a profound effect on the way we live- and work. Given a common cause, people power is unstoppable.
The ability of these new people networks has been recognised by business where the more enlightenedmaintain Online Brand protection programmes, write blogs, tweet, and endeavour to instigate viral campaigns to manipulate people networks to their own advantage.
But is this relevant to business ?
A ‘company’ is called that simply because it is made up of a company of people. How many companies say that their most valuable asset is their people. How true it is, try running a railway without drivers or signal men, or running a software development without programmers. People matter and leading managers recognise what’s happening in social networking can be harnessed to drive their businesses – people power, or business collaboration. Indeed, some would say it can’t be stopped - adapt or die.
The nature and culture of management in business has changed already. The ‘Command and Control’ management style enjoyed by many CEOs in the past has gone. Today teamwork and collaboration are the norm. Leadership the accepted management style, people orientated collaboration the culture, people centric technology the facilitator.
IT has to step up to this challenge to enable these new strategies - only if it can deliver business solutions, not just fancy names for the same technology, will it meet the true business need.Collaboration in the business environment is recognised as being one of the key tools CEO's are looking at to drive productivity for the next decade - particularly if it can be delivered without complexity or capital investment.
To make the successful transition their vision has to be converted into a strategy. A strategy that addresses the three pillars of change – Culture, Technology and Process.
You can’t identify at the start of a shift in business culture all the aspects that will be impacted, but you can describe the vision. A culture where information travels to the right people, any time, in any place, on any device. Where virtual teams form rapidly to solve business problems then dissolve just as quickly – without management intervention. No more ‘I sent an e-mail’excuses but effective communication between empowered people.
The process of creating this new culture needs to be led by management who believe and demonstrates it through the way they act and how they communicate. The benefits are business processes that will be changed, new ones invented, and many scrapped. This is long term business development, a journey, not a light-switch change - but a revolution when looked back on from the future.
The technology to achieve this has to be invisible.People centric technology is intuitive, adopted because it engages its users, inspires and opens up new horizons. You know its right when your people can’t function without it.
Cloud Computing, Software-as-a-Service, and Unified Communications are all technical developments which alone do not deliver cultural change (except maybe in the IT department). These will be part of the solution, but are not the ‘end game’.
The application that runs in the world of the users, that gives them a real-time window on their business world, enables them to interact with people based on their availability, skills, interests and knowledge in a secure way, will be the deliverer of cultural change. This will be the application that grows productivity for businesses, for the next decade.
At Presence Networks we believe that SaaS was invented for real-time business collaboration applications. This means doing away with deployed servers and routers yet being able to deliver unified communications that are easy to use and harmonises Enterprise IM, Presence, web and audio conferencing, VOIP, etc, for users into a single application that supports desktop and mobile devices.
Many suppliers claim to have SaaS solutions but in the small print you find you're required to upgrade existing Exchange or Windows servers or install network infra-structure or worse still, desktop Office applications. Business collaboration applications that are simple to deploy and give immediate benefit to customers have to be the SaaS applications to watch.
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