Video conferencing: The business case

The Sydney telepresence suite at Sheraton on the Park was the first cab off the rank for Starwood Hotels — and the first publicly available suite in the southern hemisphere. It uses Cisco technology and the hotel partnered with its communications provider, Telstra, and Tata Communications.

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It could be any meeting room, anywhere, with one major difference: The room, within Sheraton on the Park hotel in Sydney, is a gateway to the world. At the push of a button, we are chatting to colleagues in Toronto, Canada, speaking to each other as if we were seated across the table. We see the nuances of facial expressions, hand gestures and presentations, full-size, clear and uninterrupted.

Until Starwood Hotels unveiled its suite at Sheraton on the Park in February, telepresence in Australia was little more than a showcase technology. Impressive, immersive and bleeding edge, vendors were keen to promote the benefits but, with a hefty pricetag, the concept of virtual meetings featured well and truly on the ‘nice to have’ side of CIO’s priority lists, if indeed it featured at all.

“Before it became a global initiative we tried to get it running between Sydney, Singapore, Macau and another location in Asia,” explains the director of information technology for Sheraton on the Park and IT regional director for Starwood Pacific Hotels, Lindsay Leigh. “We decided it wasn’t going to be as effective if we only had four locations talking to each other. So we went to the US.

“A few other Starwood hotels were looking into the technology so we sent our heads of IT globally to talk to vendors and see what we could come up with.”

The Sydney telepresence suite was the first cab off the rank — and the first publicly available suite in the southern hemisphere. It uses Cisco technology and the hotel partnered with its communications provider, Telstra, and Tata Communications. Telstra was keen to get behind the project, managing the backhaul. The Tata Global Network includes a submarine cable network and a Tier-1 IP network, with connectivity to about 200 countries across 400 points of presence.

As the first implementation, Leigh wanted the room to be the showpiece of the region and the hotel. Cisco installations must conform to set guidelines but as the saying goes, the devil is in the detail.

“The room is 100 per cent soundproof; all of the walls are double-thickness, double padded, the air conditioning ducts have been hidden and battened down so there’s no noise. We went through about 10 different configurations of lighting until we worked out what was best for where all the individual people sit,” he says. “The little things we learned have become the standard across the whole of Starwood. So we were in a trial period on the fly to make it fit and it has come together perfectly. This is what they base everything else on.”

It is somewhat of an inconvenient truth that the global financial crisis has been a bit of a boon to the telepresence and video conferencing industry. Faced with the indelible need to cut costs and increase productivity, enterprise began to explore alternate methods of collaboration that don’t involve getting in a car or on a plane. It was a key part of the business case for Starwood’s own telepresence network.

“The first part was: ‘Will people want buy this and what is the price point at which people would look at this scenario?’ “So we analysed the cost of flying; if you fly a CEO or senior executive from here to Singapore it’s $3000 to $4000. But we also took into account the cost of people not wanting to leave their family.”

Sheraton on the Park charges about $500 per end point, per hour. Anybody can use the service and the hotel setting, where staff are on call 24 hours a day, makes the round-the-world proposition realistic, particularly in Australia where long-haul travel is otherwise an inevitability.

But the GFC cannot take all the credit; virtual conferencing makes tonnes of sense from a sustainability perspective — and we’re talking tonnes of carbon. Sustainable collaboration

Telepresence is perhaps the pinnacle of virtual meeting technology but it requires significant investment. It has, however, helped bring video conferencing technology into the parlance of enterprise.

“Larger organisations will be going for high quality, such as Cisco telepresence, Polycom or Tandberg,” says senior analyst for enterprise Asia-Pacific at Ovum, Claudio Castelli. “Normally, you have to have a carrier behind you so the companies tend to be multinationals with sites in multiple locations.”

Castelli says video traffic in the enterprise is growing as video conferencing technology makes it possible for companies to go for high level solutions without the high level investment.

Some companies like international planning, infrastructure and environmental consulting firm, Parsons Brinckerhoff (PB), combine both. PB is considering the deployment of a telepresence solution between its offices in London, New York and Dallas. Closer to home, however, Australia Pacific-based CIO, Christopher Johnson, successfully implemented a Tandberg-based video conferencing solution that has not only garnered considerable buy-in from employees, but material return on investment.

PB Asia Pacific was already using Cisco’s WebEx Web-based conferencing at the desktop level, but the solution had reached its limit within the organisation. Johnson was keen to explore the collaborative opportunities of video-based solutions. He and his team worked with managers to identify the sites employees most travelled to by rental car and by plane — the Gold Coast and the Sunshine Coast, Brisbane, Sydney and Melbourne. Based on the findings, he was able to make a case to trial video conferencing.

One of the key drivers for the implementation, Johnson says, was the organisation’s social and corporate responsibility focus. The company recently established a ‘fly free’ week, when air travel was banned for all employees, as part of its sustainability program.

“From a corporate responsibility perspective, we commenced an advertising campaign within the business in the four locations around the theme of: Why jump on a plane or get in a rental car when you can achieve the same thing and maximise time in your day through video conferencing — why not give it a shot?”

Johnson cites directorate-level sponsorship, communication and a multifaceted approach that took in all business units as some of the reasons for the project’s success. He is also impressed with the reporting functions of the system which allow the company to track the number of conferences, network performance, carbon-based reporting and return on investment.

“There are some assumptions in reporting,” he admits. “It asks for the number of participants and the typical cost of travel per participant. But it became pretty clear to us during the 60-day trial that there was a material return on this investment — a very tangible reduction in carbon emissions and in rental cars and flights, and the rather intangible in productivity gains.”

Next: The productivity equation

Join the CIO Australia group on LinkedIn. The group is open to CIOs, IT Directors, COOs, CTOs and senior IT managers.

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