Talking in one voice

Why diversified businesses are adopting a unified communication strategy

How many times did you lose a business opportunity because you were not available when the prospect called? Chances are that most companies might never find out.

A recent study by Insignia Research for Siemens Communications reports that an average 1,000-employee enterprise, for instance, could lose around Rs 50 crore a year "" solely as a result of being unable to communicate and collaborate with others in real time.

With large-size IT companies, having an employee base in excess of 40,000 people, losses could well be in the range of Rs 2,000 crore annually.

With modes of communication increasing manifold "" instant messages (IMs), emails, phone calls, faxes, conference calls "" and with most companies working out of multi-locations, co-ordination problems, long-distance phone expenses, administrative overheads and delay in conveying crucial business information are all the order of the day.

The Siemens study further states that enterprises are wasting roughly Rs 1.35 lakh per person, each year, in business travel expenses. If you factor in travel and communication expenses, the data shows an annual impact of a little over Rs 5 lakh per employee, irrespective of the enterprise size. In India, analysts estimate that the costs can run to around Rs 2.5-3 lakh per employee.

Is there a way out of the situation? Integrate all your communication platforms. Unified Communications or UC, as it's known in the industry, promises to do just that.

Analysts tout that UC will transform business communications the world over as fundamentally as e-mail did in the 1990s. It will shorten deployment time, reduce costs, leading to increased revenues and enhanced productivity.

UC comprises a "presence" (indicated by green and red dots, similar to the chat option on Gmail) framework that tells you where the people you want to reach are located; whether they are available to participate in the conversation; and what communication device they would prefer to use at that moment.

UC seamlessly shifts among the various device options "" selecting the device that's best for the business at hand and for the user at that moment.

In India, companies that are testing and implementing UC solutions include not just the high-tech IT and BPO firms, but also banks or public service facilities like airports.

Among the early adopters include, Mumbai International Airport (MIAL), FMCG goods company Marico, IT major Wipro, South Indian Bank, aluminium major BALCO and business houses like Godrej to name a few. the strategist takes a look at some cases.

Marico trims its mobile bills
Mumbai-based hair care and personal products major Marico had a problem of ensuring better co-ordination in a widely scattered customer base.

Every month, over 70 million consumer packs from Marico reach approximately 130 million consumers in about 23 million households, through a widespread distribution network of more than 2.5 million outlets in India and overseas.

Given this vast network, Marico wanted to enable better communication and collaboration among its employees. Marico's own manufacturing facilities are located at Goa, Kanjikode, Jalgaon, Saswad, Pondicherry, Dehradun and Daman, connected by 35 depots and supported by sub-contracting units.

The company wanted to reduce the time and costs incurred by employees travelling for meetings and reviews. Also, most of the services available to the company's employees were hosted on its server. Hence, to access this information with the pay-per-use model, cost was a major issue.

After evaluating Skype, Google Talk and Yahoo messenger, Marico chose a Microsoft solution which "provided information workers with the ability to use the Office Communications Server (OCS) 2007 presence (indicating availability or non-availability) to increase their efficiency," says Girish Rao, head, IT Solutions, Marico.

Marico has reduced travel costs for its engineers and IT personnel since they use presence to find out who might be available to help and make contact with that person instantly.

"We have done away with mobile calls to a large extent. Instead, we use voice calls over OCS (which sits on the PC or laptop) and do audio conferencing which saves us a lot of money," says Rao who started with a 40-user solution, and aims to scale it up to 100 in a couple of months.

The solution also enabled communication and collaboration with vendors and partners, thus achieving faster time-to-market for the company's products and services.

Banker's report
A large private sector bank (that wishes to remain anonymous) was losing around Rs 15 crore per annum in terms of "lost opportunities". Customers would visit different branches and ask for customised solutions in term deposits, home loans or NRI schemes.

"It's not possible for all branch managers and staff to be experts in all schemes. So if there was a requirement for a scheme that the branch staff did not know, they would tell the customer that they will get back with an answer. Generally high net-worth individuals never come back. That means loss of revenue," says Minhaj Zia, Business Development Manager, Cisco India and SAARC.

Cisco installed a kiosk at the bank's branches as a pilot. The PC screen is equipped with a video and IP phone.

Whenever a customer makes a request for a service that's not available at a particular branch, the branch staff goes to the installed kiosk, clicks on a menu, checks for the availability of a subject matter expert in any other branch (using the red and green presence icons) and initiates a video session with the subject matter expert and the customer. The customer is thus retained.

There's also the example of Kerala-based South Indian Bank (SIB) which chose a Voice over IP (VoIP) solution from Nortel to reduce the costs incurred on the separate voice network which was proving expensive and cumbersome to manage.

A G Varughese, DGM (IT), South Indian Bank, notes that the bank now has a faster, secure, more efficient, and less error-prone network.

Talking shopfloor
Even manufacturing units can benefit from UC. For instance, BALCO "" an aluminium manufacturer which is part of the Vedanta group "" required a communication system which included a local area network (LAN), closed circuit television (CCTV) and public announcement system for its new Orissa plant.

"There were too many people involved in the process and the need was to converge all communication systems into one," explains Subrata Bannerjee, CIO, BALCO.

The plant is spread across 6 km and travel within the plant itself is tough. One could easily connect across the entire set up using an IP solution. But it had to be a very rugged one due to the tough conditions at the site "" dust, heat and so on. Cisco put up a demo in a very vulnerable area for 15 days. It organised another demo in the corporate office. BALCO was satisfied with the results.

"We now have 49 CCTVs, and around 400 IP phones (50 of them with video). IP-based communication scores over traditional telephony. Applications can be run on IP phones which even provide details on production and scheduling. This is a huge huge benefit. Conferencing, both video and audio, too can be done," explains Bannerjee.

The entire project was completed, thus saving on the cost of laying out copper for a conventional telecom set up. The IP phone purchase was done in a phased approach.

Airport woes
At airports, UC implementation takes a different route since customers could be reporting a lost or stolen bag, terrorist attack alert, bomb scare or simply an urgent message for an airline's pilot. They could do it by phone, email, voice mail or even fax.

Michael Ibbitson "" head of networks, Mumbai International Airport Ltd (MIAL) "" and his team were given the task to completely alter the communications network of the old airport.

They had to ensure that all the personnel across the airport area "" at airport restaurants, beverage outlets, airline counters, security cells, travel counters, customer care cells and manned gates "" could be reached, regardless of the device on hand and their location.

"We had countless analogue (voice) phones, radios and multiple switches. What we needed, though, was a single advanced communications system across the airport that would simplify the way airport staff communicate, and also help to cut operation costs," says Ibbitson. So they had to consolidate the data, telephony and video systems of a network that handles over 20 million passengers daily.

The solution was from Nortel while Tata Consultancy Services (TCS) was the systems integrator. The first phase cost MIAL between Rs 24-28 crore. Similar work is on at other major airports like Delhi, Bangalore and Hyderabad too.

Does it makes a business case?
Companies estimate cost savings to range between 25 and 30 per cent over traditional communication technologies (like analogue phones).

While it's too early to speak of a return on investment (RoI) in the Indian context, Forrester Consulting, in a study for Microsoft, notes that customers can achieve more than 500 per cent RoI over three years by deploying UC solutions.

Microsoft entered the UC arena just a month back with its software-centric approach. "Our work is to break the walls that separate telecommunications and computing. Others do it with hardware. We do it with software," notes Vibhu Ranjan, Director, UC, Microsoft India.

Other players include Cisco, Nortel, Avaya, Siemens Communications and HP, who have been in this field for many years.

"UC is a business-process enabler. It helps businesses react quickly to market changes," notes Sukhvinder Ahuja, Microsoft business leader, India of Nortel (Nortel partners with Microsoft for UC). The adoption is slow. It makes sense where there are a large number of mobile users.

The primary adopters have been the IT companies followed by banks and hospitals. The retail sector will soon be adopting these solutions, says to Kaustubh Dhavse, program manager, ICT Practice, Frost & Sullivan, South Asia and Middle East.

He, however, adds that firms need their metrics in place to understand the benefits. "UC features are expensive. Companies should first define their current productivity and then see how UC adds to it. It makes a lot of sense for sectors where the margins are low. Even though the capital expenditure will be high initially, the return on investment should make that up."