If they're done right, portals can provide financial returns and less tangible benefits. How can you get the best results and how do you measure your success?
Like any new technology, enterprise information portals (EIPs) were greeted with raucous enthusiasm when they began emerging as a concept several years ago. Unlike many new technologies, however, they've actually proven their worth as a practical way of making it easier for users to access the information and programs they need.
Years down the track, early portal adopters are weighing in on the benefits portals have provided. They report employees working more efficiently, managers getting better access to information, faster resolution of internal problems, and customers that come back time and again. In many cases, this has led to a clearly demonstrable return on investment (ROI) that has more than justified companies' investments in portal technology.
Consider the experience of US$7 billion global oil and gas services giant Halliburton, which set up its myHalliburton.com portal as a way of concentrating internal knowledge and external customer contact into a single interface. At a cost of around $US7.2 million over the last three years, the portal has generated an estimated ROI of 559 percent in direct savings—through better access to documents, faster payments, and increased sales. More to the point, the availability of the portal has been named by customers as having influenced around US$220 million in new business.
These kinds of numbers are enough to make any business manager sit up and take notice, which may be why portals have become a shining star in an otherwise lacklustre IT spending market. In a survey of more than 2800 organisations in Australia and 11 other regional countries, IDC found that growth in companies' spending on enterprise portals had outpaced all other areas of IT investment—jumping from 12 percent in earlier years to 17 percent in 2002.
For its part, research firm S2 Intelligence, in a recent survey of senior IT decision makers at Australian companies, found that enterprise portals were ranked third out of the 31 categories of projects seen to be delivering the greatest business value. They trailed enterprise resource planning and telephony projects, but came out well ahead of other much-discussed investment areas like security, business intelligence, wireless networking, and B2C commerce.
Give the business what it wants
Strong support for portal projects means it should be easier than usual to get the executive support that's essential for any enterprise project to succeed.
That support, however, is not by any means something to be taken for granted. Earning executive support typically requires portal teams to do a considerable amount of groundwork to identify the company's worst pain points and the business solutions that are seen as potentially relieving those problems.
For natural gas giant Santos, this process was a key part of the groundwork that preceded construction of an internal portal, called The Well, that was envisioned from the start as a way of improving employees' access to their data and to each other.
Project planning involved surveying the needs of users across the company's major sites, gathering their feedback about the portal as a solution, testing prototypes with them, and then using these results to win both business sponsorship (a financial commitment to support the portal) and business ownership (a philosophical commitment to the whole idea of the portal). Those surveys revealed five key Santos business requirements: collaboration, communication, consolidation, consistency, and access.
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“Portals have taken their place as higher-level infrastructure, and I think this idea of an integrated organisation is much less expensive for businesses to do.” --Mike Rhoads, IBM |
Underscoring each of these elements is the promise of increased employee productivity, something that any executive can appreciate. Productivity, after all, is a driver for economic growth—something that had US financial analysts smiling after US Labor Department figures revealed productivity in that country had grown by 6.8 percent between April and June despite the loss of 170,000 jobs during that quarter. Improved worker productivity, in short, allows companies to produce more, with fewer people.
Executives like this—particularly in the current economic climate. So for companies looking into portal deployments, finding ways to simply increase productivity can be a great first step.
"We've had to do a lot of justification around ROI, and you have to work with the executives on their level," says myHalliburton.com program manager Brandon Lackey. "Ask yourself the kinds of questions they're asking themselves. Just saying that the portal will add more value than it costs isn't relevant from an executive standpoint; if they're deciding whether to increase manufacturing capability, buy another truck, or add another sales employee—where they know specifically how much revenue that's going to generate—you have to be able to say that a portal can add more value than adding another sales employee."
Collaborate or die
In many cases, that value comes from just helping employees talk to each other more readily—at almost no incremental expense to the business. Recognising that online collaboration is a significant business driver, many portal advocates are using it as a key lure when selling the benefits of a portal to executives.
Vendors are responding in kind. Whereas the portals of a few years ago were almost exclusively focused on better ways of squeezing all sorts of content into a single Web site, today's portals are more platforms for stitching together content, applications, and real-time communications through the integration of features such as pervasive instant messaging (IM)—pervasive, in this case, meaning that online documents will retain information about their creators and always tell portal users whether those people are online.
The idea is to resolve issues more quickly by bridging geographical and organisational gaps—something that has been heretofore impossible to achieve using simple e-mail or even structured workflow tools like Lotus Notes. But with IM providing instant awareness of other peoples' availability and the portal ensuring that everybody is working from the same page, discussions about the need for structural cohesiveness take on an entirely different timbre.
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“Just saying that the portal will add more value than it costs isn’t relevant from an executive standpoint; you have to be able to say that a portal can add more value than adding another sales employee.” --Brandon Lackey, Halliburton |
Better still, the dominance of a few general-use portal providers—IBM, Microsoft, Plumtree, and their ilk—means the technology is easier to use and faster to implement than ever. That's raised the profile of the portal, and changed it from being a content-aggregation technology into something far more fundamentally important.
"If everybody is coming to the portal to get their content or use a set of consistent applications, it's a great place to give them ways to talk to each other and interact with business partners or customers," says Mike Rhoads, worldwide business unit executive for WebSphere solutions with IBM. "Portals have taken their place as higher-level infrastructure, and I think this idea of an integrated organisation is much less expensive for businesses to do. You're talking about months instead of years' worth of work."
The human element
Although it's clearly possible to encourage strong takeup of an appropriately designed portal, not all companies will immediately see such benefits. This is particularly the case as increasingly easy-to-use portal software puts control over communities into users' hands.
Yet John Brand, vice president of analyst firm META Group, warns that companies need to be careful not to get carried away with the technology: "There are a lot of different outcomes that organisations should be looking for in using collaborative technologies," he explains.
"The reality is that you can identify a team space for every employee, customer, group of employees, or business issue that comes up. But just because vendors are providing those technologies doesn't mean you should be using them in that way. Organisations need to really understand what their current collaboration environment is, then apply new technologies in a way that protects the integrity of their enterprise architecture."
The promise of improving teamwork, quickly and inexpensively, is a major asset when angling for executive support. But empty promises will never be accepted without someone to blame if they fall short—something that's led most portal leaders to recognise that no collaboration portal can meet its business goals without human involvement. In successful online collaboration models, this involvement usually takes the form of a human mediator who is for the responsible usefulness and integrity of each portal sub-community.
Human mediation was crucial for Starbucks Coffee Company, the parent of what has become a 6300-store global franchise, as it sat down to plan out its own internal corporate portal. Providing a useful business tool required the company to construct a broadly accepted online community that reflected regional differences and suited the needs of individual operators, whilst providing for the maintenance of a consistent global brand.
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“Just because vendors are providing those technologies doesn’t mean you should be using them in that way.” --John Brand, META Group |
Surveying users' requirements allowed the portal architects to build their online presence around five key types of communities: line-of-business (corporate business units), functional/role (eg store and business managers), project teams (cross-functional and temporary), social activities (non-business communities such as ski clubs), and products/promotions (such as the Starbucks Card loyalty program).
Understanding its portal requirements helped Starbucks develop a portal that's proved remarkably relevant across its business. In early 2002, the portal went live within offices consisting of some 6500 employees; in June this year, the portal was expanded to cover four roles and 4000 stores across North America. Around 12,500 users now access the portal, which includes 248 different portlets (portal hooks into business applications), 330 different communities, and 120,000 online documents.
More telling, use of the portal has climbed dramatically: workers at all of the company's stores access it at least once a week, and 89 percent access it daily. Internally, around 62 percent of users access the portal every day, while 81 percent visit weekly.
Kris Winkler, portal manager with Starbucks, credits the portal's success to the company's focus on appointing 'community managers' who are tasked with jobs such as monitoring discussions, managing community memberships, approving published content, and advocating the use of portal communities within the company. Starbucks community managers undergo training that educates them about the responsibilities of the position, which include processes for maintaining membership, slightly technical training about how portals function, and the need for metadata to improve document management.
By applying such rigour to the creation of online communities, companies can ensure that those communities are serving the specific business needs of carefully delineated organisational subgroups. The benefits, in other words, are maximised by avoiding inefficient use of the portal.
That's turned into big savings for Halliburton, which—upon going live with its portal—appointed full-time knowledge brokers from specific business units. These knowledge brokers understand the nuances of the business, and are responsible for facilitating communication between people that have problems, and the people that can fix those problems. Faster closing of support issues alone is estimated to be saving the company more than US$1.2 million annually.
