The Business Value of Intranet 2.0

You think collaboration and even social networking tools are a good idea but there is a real concern that they’ll waste employees’ time and decrease productivity. Do intranet 2.0 tools, like internal social networking, wikis, blogs and discussion forums have a business value?

The main uses of intranet 2.0 tools are by the information worker whose current task load unfortunately isn’t quantified. However, studies show that as much as 11 hours a week are wasted in the search for and the management of information. As well, when trying to find subject matter experts, employees use different methods with varying degrees of success. This inefficiency is compounded by the enormous amount of information available which is growing exponentially and is in a diverse range of formats.

When all is said and done, however, there is a growing perception of the importance of intranet 2.0 tools. And there is an increasing expectation, especially amongst GenY employees, that they will be able to collaborate and contribute. While there are risks, the benefits can be considerable especially for innovation, engagement and gaining efficiencies.

11 hours a week – time being lost

It is estimated that the average information worker spends almost nine hours a week searching for and gathering information but almost half of that, 3.7 hours a week, is spent in searching but not finding information. Add to that the estimated 3.7 hours per week that is spent reformatting data because it comes from multiple sources, plus 2.5 hours per week recreating information that couldn’t be found, and another 1.2 hours per week caused by version control issues and you get over eleven hours per week per information work that could be better spent, at an approximate value of $20,000 per year per information worker (based on a $75,000/yr salary) – is there value in that? 1


Chart: Breakdown of 11 hours per week per information worker that are “wasted”.

Who are you going to call? – finding subject matter experts

Over 50% of employees want the ability to locate expertise to help them with their jobs (according to Recommind). They currently try to find experts by:2

  • asking around (71%),
  • using the company directory (46%),
  • using the intranet (34%) and
  • 30% will send a company-wide email (according to Vanson Bourne).

Information growth – 6X more

Information is expected to have increased six fold between 2006 and 2010, and while that may not be reflective of all organizations, it is safe to say that information is increasing and is available in more formats from more sources. Therefore, the challenges to find the information and the people you need is only going to get harder.3

2.0 Importance

More than 50% of those surveyed in a recent AIIM study consider the use of Enterprise 2.0 applications to be important or very important.4

Generational Expectations

Companies are recognizing that there are four generations at the workplace:

  • Traditionalists (1925-42)
  • Baby Boomers (1943-60)
  • GenX (1961-81)
  • GenY or Millennials (1982-2001)

GenY are eagerly engaging in, and have an expectation of using social networking and collaboration tools. While GenX and Baby Boomers understand teamwork and expect to be able to give feedback, GenY’s expectations are that they can collaborate, give their opinion on everything and use all the tools at their disposal. Understanding emerging expectations and behaviours now in order to implement processes and governance will ensure that everyone starts at the same footing.5

Risks – failure, low use, quantifying value

Some organizations can’t see the benefits in using new technology especially if they’ve had a negative experience, and of those who have tried social media internally many have experienced low participation and adoption for multiple reasons.

  • 70% of social implementations fail because they lack a business purpose, according to Gartner (source: socialtext.com)
  • Adoption:
    • low adoption is perceived as failure even though the emphasis needs to be on the business use of the tool to drive results and therefore the quality of information being shared with the people that most need that information
    • satisfaction and adaption to change needs to be measured in terms of the use of the social media tools
    • enabling and empowering employees by giving acceptable use policies and fostering a culture of collaboration can increase participation
  • There is difficulty in quantifying the benefits since inefficiencies around knowledge work isn’t measured

Intranet 2.0 Value

Measurable benefits attributed to web/enterprise 2.0 applications can be categorized under three key areas of Innovation, Engagement and Efficiences:1,2,4

  • Innovation
    • an increased ability to share ideas
    • Improve company performance as awareness and knowledge increase
    • Being able to find information quickly allows time for further analysis which spurs thought and innovation and can lead to new product ideas
  • Engagement
    • Improvement of departmental synchronization and alignment
    • New employees onboarded quickly
    • Employees know each other
    • Having a more rounded and diverse range of information rather than just email pieces
  • Efficiencies
    • Reduction in costs (as much as 10% decrease) for travel, operations and communications
    • More rapid access (as much as 30% increase) to knowledge experts
    • Reduction of email by 30%+
    • Ability to quickly respond to opportunities
    • Implementing 2.0 tools can force the streamlining of processes as well as the implementation of governance and strategy

Value Examples7

Socialtext and IBM have recently published good examples of the effective use of social media tools with measurable results.

Socialtext examples:

  1. FONA International

· Problem

    • Email burden of 50,000 estimated per year
    • Excel and email used to track training and certification of each employee for regulatory compliance with versioning and accuracy issues and a lack of an audit trail

· Solution

    • Collaborative software with calendaring and social spreadsheets
    • Eliminated 50,000 emails a year
    • Version confusion eliminated
    • Audit trail established
    • Accuracy and engagement improved as individuals are responsible for their own information
  1. TransUnion

· Problem

    • Custom software code performance issues

· Solution

    • Using social tools started conversations to solve the issues
    • Brainstorming occurred
    • $2.5 million estimated saved as they didn’t go out and purchase hardware
  1. Law Firm

· Problem

    • Several lawyers on account with little coordination
    • Redundant work effort
    • Higher search and coordination cost for client
    • Strained client relationship

· Solution

    • Wiki workspace
    • Structured formal processes
    • Transparency in sharing what each was working on including with the client
    • Improved client satisfaction and loyalty

IBM example:

  • By instituting an enterprise tagging service, IBM estimated that they saved 12 seconds per person or 955 hours per week with an estimated value of $7.5 million with the one time cost of development of $700,000 delivering ten times the value.6

Conclusion

The question really isn’t whether or not intranet 2.0 tools have business value, rather it is can you afford not to use them to improve information workers’ ability to find the data and people they need quickly and easily to do their job? And is it realistic to ignore 2.0 tools because of fear of misuse when time wastage is already occurring? Is it reasonable to expect a whole generation that is hot wired to collaborate and share to change their behaviour?

Assigning business value by having a strategic plan for 2.0 tools and their use, as well as implementing defined processes and governance, will empower employees to do what you’re paying them to do – think.

Sources:

  1. Hidden costs of Information Work: A Progress Report by Susan Feldman, www.IDC.com
  2. Social Text http://www.socialtext.com/
  3. An Expanding Digital Universe: A Forecast of Worldwide Information Growth Through 2010 http://www.emc.com/collateral/analyst-reports/expanding-digital-idc-white-paper.pdf
  4. Paloalto Application Usage & Risk Report: http://www.paloaltonetworks.com/literature/whitepapers/Application_Usage_Risk_Report_Fall09.pdf
  5. You Talking to me? http://www.prescientdigital.com/articles/content/you-talking-to-me-online-communications-considerations
  6. IBM example: http://www.lbenitez.com/2008/08/ibm-earns-award-from-ciocom-for-social.html

Prescient is vendor neutral and provides reference to Socialtext and IBM as additional sources for information only.

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