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Strange Mutations

Strange Mutations

In the 1956 horror film Invasion of the Body Snatchers, alien beings take over the bodies of sleeping people, assuming their exact likenesses after gestating in strange-looking pods. These sinister "pod people" possess no emotions -- their entire raison d'atre is to survive and create new pod people. Intranets are becoming a lot like that, says Tim Horgan, CIO Communications (US) chief information officer and Web management director.

Companies used to see intranets primarily as a means of sharing information between people. Now intranets are taking over everywhere and mutating at breakneck speed to become something else entirely. And in a development that would have raised the hackles of Body Snatchers star Kevin McCarthy, but which ought to be hailed by business, these intranet "pods" are also beginning to take on an intelligence all of their own.

Horgan is a leading expert on intranet planning, design and strategy and consults to numerous companies on their intranet strategies. In a talk to the CIO conference in May called "Internet Business Strategies: Best Practice Intranet/Extranet Sites", Horgan presented key trends in the way pioneering organisations are building best-practice Web initiatives and online services.

The insights were derived in part from the 559 Internet and 226 intranet and extranet nominations to CIO (US) magazine's WebBusiness 50/50 Awards (July 1 issue). They also came from interviews with members of the xNet Consortium, an industry group providing leadership and insight into the use of intranet and Internet technologies in business, of which Horgan is executive director. And there is also Horgan's personal experience.

Members of the xNet Consortium -- many of them Fortune 500 companies -- are convinced they'll lose their competitive standing within five years unless they find new ways to become competitive, Horgan told Informat attendees. "They absolutely believe that the economy is changing dramatically, and as the people leading the online initiatives they believe that it is their job to lead companies to make those changes." In "a medium and time of never-ending mutation, frenzy and hype", intranets are clearly evolving to meet the demand. Horgan presented 10 top trends for intranets -- many of them representing dramatic shifts from last year -- as well as lessons CIOs might take from the changes.

1. Customers are becoming the focus

"If you want to be competitive you make your customer successful. If the customer becomes successful, they depend upon you, they rely upon you, and you have a long-term relationship with them. You grow your customer base and maintain loyalty," Horgan said.

Companies originally saw intranets as an easy way to provide information to staff. This year, according to Horgan, smart companies are looking at opening internal information to selected customers to help them become more successful.

Take PHH Interactive, a US company offering corporate lease management programs. Until recently PHH used its vast store of information on vehicle and driver safety, asset utilisation and depreciation, and vehicle model cost analyses mainly to set rates for its customers. Now it's giving its fleet manager customers the same information to help them manage their businesses better. The ultimate objective is to make the customer more successful and hence win their total loyalty.

Dell Computers is clearly thinking along similar lines. Its new service for premium members simplifies the corporate ordering process by extending Dell's internal ordering system to key customers. The same customers get an online single point of entry into more than 10,000 pages of customer-specific information, support and reports. The move helps Dell in a variety of ways, but also gives customers a single point of entry, lets them standardise and manage their PC purchases, and helps them run their businesses in a more predictable, steady way.

If a company can work out how to become indispensable to customers by giving them information they "absolutely need" to run their business, reliably and with high quality, the company can become critical to them, Horgan says. "And if we make ourselves easier to do business with, we can certainly make more profit from a more stable base, with growth as we go along. Customer loyalty is critical for the future. Every single person on xNET absolutely understands that."2. Delivering information where it's neededWhen management information systems were the focus, IT assumed only internal management needed corporate information. Now Mazda North America is moving its internal information out of its dealership repair shop floors, giving grease monkeys access to vehicle repair information and warranties and letting them track specific vehicles.

Cleaver-Brooks, a Milwaukee-based manufacturer of custom boilers, has moved its intranet into the boiler room, to help 10,000 engineers worldwide to design and specify products better, faster and more accurately. "We should not assume information is just for internal management any more. And we should look for opportunities where we can integrate different types of information, and present it in one delivery," Horgan said.

3. The intranet as a utility

Numbers of larger companies have stopped viewing the intranet as an optional extra. Suddenly it's at least as critical as the phone or electricity -- it has to be there for them to continue their business. "We didn't see that last year and we were a little surprised to see that as early as this year," Horgan said.

Ford Motor has been committed to using the Web to share information for more than two years. Today, 100 per cent of Ford's employees can do 90 per cent of what they want to do on the Web and the rate is constantly rising. Suppliers are connected to Ford's intranets and there are intranets for every aspect of its operation. And there has been a huge payoff. The company has reduced time to market from 36 months to 24 months, generating billions of dollars worth of savings.

Many businesses are also focusing on delivering intranets to program teams. The team developing Ford's year 2000 model Cadillac has a dedicated intranet which focuses on the company's work and concentrates on giving team members the tools they need to make them successful.

Horgan says one lesson from this trend is that if companies are viewing the intranet as a utility, "it had better be there".

Utilities require robust infrastructures. At Ford they have accepted that the same disciplines that have applied to other IT applications for years equally apply to the company's intranet strategy. Ford knows just how much back-end work in terms of servers, redundancy, search engines, backup, and good information system planning has to go with development of these systems.

"And we may look at Ford, we may look at GM and say they're wildly successful, but in fact they're very clear they're nowhere near done with this stuff," Horgan said. "There's a lot more they can do and a lot of research they need to do and they are not complacent over what has happened so far. They know they need to move things out to the customer and they need to get better at what they are doing."Research and development is continuing, he says.

4. Integrated into all business processesSmart companies are using their intranets to create value by deeply integrating them with business processes.

Cisco treats every one of its 16,000 employees as a Web developer. All development is Web-based and all development is funded by the business, not technology, to ensure the business sees the value. Cisco's ROI is running at $US35 million a year or $US650,000 an employee. "[Cisco is] able to get those numbers because it is focused on making itself as productive as possible," Horgan said.

Another example is Forsythe Technology has an intranet/extranet-based order management system that touches every process in the fulfilment chain, both internal and external.

5. More interesting applications

Many companies are now using intranets for a range of interesting and innovative applications.

Remedy Software and Sandia Labs both have rumour services where employees can post questions and get responses from staff. National Semiconductor has a site where staff can build a home page for customers. Some companies are providing ISP services for employees, and one organisation is offering a graduate school hub which lets staff work anywhere in the world and still be connected to classes.

Sun Microsystems provides Web construction kits for all employees, and others are using stage tickers to help people keep track of projects and programs.

"People are getting more creative about the applications they give people. It's an interesting trend and well worth doing," Horgan said.

6. Helping support collaboration

Accepting that collaboration takes place not just among employees but increasingly with business partners and others, smart companies are starting to create communities of learning as well as communities of practice.

For instance, the US Navy and Boeing share design information with each other via GOSNET. The Oncology Research Centre provides support for doctors treating cancer patients anywhere in the world by matching a patient profile against clinical studies in the field. Then doctors and researchers can collaborate in virtual conference rooms.

"At CIO we believe that true collaboration is going to be one of the most important parts of intranets as we go along," Horgan said. "We also understand collaboration exists at many different levels: between doctor and patient, people on the car floor and people on other car floors."It is equally true that collaboration is seen as a terrible threat to management, Horgan said, because it can break down stable management structures and degrade traditional ways of doing business. "It's critical, it's going to change things, it's going to directly affect how we manage companies. It's the right thing to do, but we need to recognise this type of change is going to really have some implications across management," he said.

7. More sophisticated development modelsAccording to Horgan, companies are starting to talk about "designing in the big and building in the small". Understanding in its entirety the set of things they might need to do to make an intranet successful, but then building the required pieces one at a time and as they go along. They are creating a master plan of the functions, types of applications and kinds of information systems needed, but then building those gradually, and after prioritising their requirements.

As part of their development model Cisco and Ford have recognised that local groups should do much of the work, but that some work needs to be done at corporate level and the results shared by everybody. "It's difficult to find that balance, but a couple of companies have really worked to try to find it," Horgan said.

There is also a strong focus on scalability, with three-tier architectures being applied to the Web. For instance, Ford wanted to move information from warehouses to make it more widely available, so it set up the infrastructure to do that, recognising that traditional design approaches were still valid for the Web. And there's much more emphasis on testing and usability.

Sophistication also brings more sophisticated funding models and more creative approaches to funding. Ford's one-year grace period for Web support is an example. "We're also seeing more sophisticated applications," Horgan said.

"Configuration management, sophisticated billing systems are being moved to the Web and those systems require more care and testing."8. Less is moreMany companies are purposively keeping their intranet teams very small, recognising that the performance of large teams tends to degrade. To keep their teams small they are hiring the best people possible and giving them the tools they need to get on with their jobs.

Take Sandia, where eight people do Web work for 5000 employees; or Fujitsu, which has four people doing the work for 1000 employees. These small teams manage to achieve very large amounts of work by working with the IT and corporate people but remaining small, focused and driven. Organisations are becoming more sophisticated in the way they measure success. The US Navy, for instance, tracks success not by the number of hits on its site, but by the reduction in number of meetings held. Success is measured in greater user productivity.

And organisations are avoiding "sexy" technologies in favour of "application-appropriate" technologies. No more jumping on the latest bandwagon, Horgan said. The best sites are being much more critical about what they use and whether it will apply to the job at hand. "What does this trend indicate to us? It means that more planning and design work is appropriate both at the technology and the information level.

"We [CIO (US)] wrote up the story about how Nortel and Bay did this wonderful intranet that leveraged everything they understood about information management, about how you categorise information both formal and informal. They moved all that [knowledge] to the Web and they created an intelligent system that's now critical to how they do their business.

"They leveraged what they do and made the Web the delivery vehicle."9. Knowledge managementOrganisations are doing a lot of work in knowledge management, particularly for areas like sales, help desk and proposal development, and knowledge communities are becoming important. Cisco has created communities of interest for various groups -- sales, IT, marketing -- and uses intranets to give those communities tools to support collaboration.

Such communities increase people's ability to compete, reduce their costs, and let them leverage what they already know; but Horgan warns knowledge management is still an inexact science and getting people to share information remains a challenge.

One technique that seems to work is getting people to share stories and describe their activities. "When people can put a narrative in there, they can say: 'These are the things I did to win this business', and then talk about the customer and the customer's reaction, the competitor's reaction. They try to give stories to other people, so they can draw their own conclusions about what would work in their situation, what are the lessons they can draw. Those seem to be the most powerful knowledge management systems that we have seen," Horgan said. The sharing of ideas and community sharing also seem to work.

10. Creating new business opportunities

US Web, with 2000-plus employees, has a focus on capturing knowledge as it goes along. As it does so, people are looking at the things they are learning and their new skill sets and by finding new places they can take those skills, identifying new market opportunities.

Hire Quality helps the 300,000 people who leave the US military estate each year to find new jobs. It has moved its intranet out to the people it does business with to help them keep track of their own records.

"They realised they could also expand some of this [information] to credit cards and other life-style support systems. They built their systems to support not just recruiting but a wider range of skills. Then they realised they could take this set of [in-house] skills they had and franchise this to other people who are not direct competitors."Pods are BeautifulThe dramatic changes in approaches to intranets over the last year show pods can be beautiful, Horgan said. Helping your intranets acquire intelligence can have positive results.

"It is feeding new business opportunities. It is for some companies becoming a competitive advantage. People are convinced if they don't do this work they won't be in business. The Web is becoming very critical.

"Resistance is futile. Eventually we are all going to move to an environment where intranets and sharing information with our customers are going to be part of the way we do business," Horgan said.

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