Total Telepresence – a new dawn in productivity

Business is moving faster than ever before and given the increasingly uncertain times, organisations need to be more adaptable, flexible and productive than ever. There are many ways that any business can achieve this, but the strategies that make real impact are the ones that address effective working patterns and business costs at their core.

In light of this many companies are increasingly turning to telepresence and videoconferencing to improve their business processes. There are a number of reasons why companies have chosen to invest in such technology instead of carrying on with web or audio conferencing. But the main reasons are:

• Reducing unnecessary business travel
• Accelerating decision making
• Meeting the ‘Green Agenda’ 

But why videoconferencing when most companies appear to have done well to date with audio and web conferencing? Much of it comes down to the huge benefits of ‘Natural Communication.’ This is the ability to engage in every business interaction – with a colleague, a supplier, a customer, a shareholder – as though it were an intimate, face-to-face discussion.

Arne Bye, platform manager, Statoil, a long-standing customer of TANDBERG puts it simply “You get those issues sorted out when they pop up. And that means you have a more live organisation that attends to the issues.”

Supporting this line of thinking, a recent study undertaken by RoperASW discovered that business professionals thought face-to-face communication, when compared to audio and online/web-based tools, was:

• Easier to understand (76%)
• More personal (87%)
• Builds high trust (90%)
• Reduces confusion/misunderstanding (81%)

But is there also a hard cost to business by not visually enabling themselves? Further research by the RoperASW survey concluded that inefficient communication cost US businesses $297 billion, with the results being consistent across Europe and Asia. All of which could be resolved through technologies such as telepresence. Other such trends that are driving adopting include:

• Virtualisation: one quarter of the world’s workforce will work remotely by 2009, (Journal of Corporate Recruiting)
• Globalisation: Research on geographically dispersed teams showed significantly increased conflict and reduced trust compared to teams working in the same office. (Journal of Business Research)
• Cost control: owing to steep increases in the cost of fuel, organisations are now looking to reduce the need for business travel.

The last point is key. Travel is not only costly but it also has a negative impact on productivity. In 2008 over one in four flights were delayed or canceled accounting for a $50 billion loss in productivity and flight costs.

Accelerating Decision Making

Today’s videoconferencing and telepresence solutions deliver an experience that is immersive and immediate. By avoiding the delays and expense of business travel, executives can accelerate decision making and compress deadlines, leading to quicker-to-market product strategies and innovation. This provides a valuable competitive edge. This is why the CEO of a large European recycling company, and a TANDBERG customer, can see all of his direct reports with just 24 hours notice. In the past they all used to fly to the HQ in Scandinavia, but it meant waiting a full month before everyone had room in their schedule to do so.

Statoil of Norway, the largest offshore oil operator in the world is also benefitting from better decisions through TANDBERG’s videoconferencing technology. Arne Bye, platform manager of the Kristin Field explains how one difficult quality assurance issue was quickly resolved by using videoconferencing: “The discussion was concluded in 12 minutes. Eight years ago I had exactly the same challenge on another platform and we spent two weeks to solve the problem.” Adolfo Henriquez, Manager of Integrated Operations at Statoil neatly summarised the benefits already realised as “We are taking the data to the experts now, and not the experts to the data. By doing that we achieve much faster, better and safer decisions in our business.”

Changes in workplace practices mean that many organisations now rely on virtual teams, operating across several locations and incorporating remote and mobile workers. Growing commercial and environmental pressures combined with the change in retirement age and new directives impacting maternity leave have meant that organisations have had to adopt more flexible working practices. This is set to continue, with the vast majority of organisations predicting the need for collaboration between remote sites to grow in the future. However these dispersed workforces pose a huge communication challenge for organisations and many communicate only by email, conference call and telephone.

Email is increasingly being regarded as more important than the phone. However, a recent business collaboration survey conducted by Quocirca found that up to 25% of users admit to frequent misunderstandings due to the inherent limitations of the medium. This is why many organisations still rely on meeting in person and over 80% of respondents rated face-to-face meetings as very important to internal communication.

But despite the value that is clearly placed on face-to-face meetings, they are typically cursed every day for their negative impact on productivity. Meeting face to face can be both costly and time consuming, whilst other methods are prone to misunderstandings.

The demand for an alternative to travel, email and audio conferencing is clearly there, with 50% of employees believing that a large percentage of travel could often be avoided by using some form of video conferencing or telepresence solution.

A case in point is Volkswagen. In order to deliver customer service excellence, VW dealers needed to recruit and train hundreds of highly specialised service technicians. Each technician must attend a week of training at Volkswagen’s main facility in Puebla, Mexico. However, for every hour a technician is away from the dealership there is lost revenue. Through installing TANDBERG videoconferencing at each dealership as well as at the training centre in Puebla, travel expenses were slashed by up to 30%, technician’s time was maximised and repair time halved.

Reducing the need for Business Travel

It is a verifiable fact that the average two-hour business meeting can involve up to six hours away from the office and come with an average cost to the business of €2,500. Given this, it is no surprise that almost 50% of organisations see reducing travel costs as very significant in their ever-tightening budgets.

The rising cost of fuel has been a major factor that has caused companies to look for solutions to stay connected and efficient whilst significantly reducing travel budgets. But this is a big challenge as face-to-face interaction is regarded as crucial in building rapport with key business partners and generating trust when making important decisions.

This is where telepresence and video conferencing comes into a league of its own. It creates an immersive ‘across the table’ meeting experience that requires no travel, allowing companies to easily hold a face-to-face meeting with colleagues in London, Dubai and San Francisco without losing a single day to business travel. Vodafone saved itself over 3,400 business trips in 2007/2008 alone by using video conferencing technologies.

It is not only the hard costs that businesses are seeing developments in either. The softer side of reducing business travel, from increased job satisfaction to better work life balance and less stress are also being reported by early adopters of this technology. DSM NEO Resins has enjoyed savings of 30% on its annual travel budget which more than covers a telepresence and video conferencing purchase. They have also improved the work/life balance for all of its international executives.

To successfully reduce business travel, companies need to change their mentality towards working. It is important to remember that effective working means shifting the focus to productive outcomes rather than simply managing by presence. Those that do this effectively have seen video conference and telepresence solutions pay for themselves within six months due to the reduction in unnecessary travel costs by up to 30%, not to mention the huge reduction in a company’s carbon footprint.

A simple but effective illustration of this is found in a recent report by analyst house Forrester. This report examined the use of TANDBERG videoconferencing technologies by TNT, a global transportation and distribution company. TNT was able to achieve a reduction, and in some cases complete avoidance, in travel costs as well as related reduction in carbon emissions. This equated to a calculated ROI of 71% over four years with complete financial payback within 2.3 years. 

Similarly Forrester concluded that Exelon, the global provider of energy services and largest nuclear operator in the United States would achieve a calculated ROI of 37% with payback on investment in 2.2 years. Commerzbank AG was able to surpass all expectations with their investment being paid for in cost saving in just three months from implementation.

Meeting the ‘Green Agenda’

Alongside cutting costs, growing revenues and increasing profit, reducing carbon footprint is fast becoming one of the top priorities for many large and distributed businesses. Increasingly businesses are waking up to the fact that becoming greener can also be a major factor in achieving the first three objectives outlined above. In line with many international government’s agreements, heavy taxation on carbon emissions is coming.

Let’s consider the following statistics:

• Currently transport accounts for over one third of the UK’s total energy use
• CO2 emissions from commercial vehicles will rise by 30% in the next five years
• A single return flight from London to Paris generates 0.13 tonnes of CO2
• The same flight to New York generates 1.22 tonnes of CO2

This poses a major issue for many businesses in every sector but none more so that those in the transport and logistics sector. However those that are often hit hardest are the ones that lead the way in implementing effective solutions.

TNT operates 47 aircraft and more than 26,000 trucks to move an average of 4.4 million parcels, documents, and pieces of freight each week. Therefore cutting back on actual traffic was virtually impossible. Instead TNT created the ‘Planet Me’ program, urging employees to reduce carbon dioxide emissions through reduced business travel and the use of videoconferences. TNT already estimates the CO2 savings from videoconferencing alone to be 2.6 kilotons a year for the next four years, or a total of 10.5 kilotons.

It is not just TNT that is seeing the light. Similarly, by utilising video to eliminate the need for over 3,400 business fights, Vodafone prevented 1,449 tons of CO2 from being emitted into the atmosphere. Sweden’s Customs Service saw a direct reduction in CO2 emissions by seven tons each and every month though adopting TANDBERG technology. TrygVesta projects to save $2.9 million per year via telepresence instead of travelling, at the same time eliminating 525 tons of CO2 from the environment.

Leading global bank HSBC that has worked extensively in the past with TANDBERG believes TANDBERG’s latest solution, the T3, “will take our use of collaborative global telepresence meetings to a new level, in addition to adding to our portfolio of green technologies.”
Not only is this good for the environment, research clearly shows customers and employees prefer companies with environmentally responsible reputations. There fore the use of telepresence and video can positively impact a company's brand value as well. Additionally many employees whose companies have adopted videoconferencing and telepresence solutions are seeing a better work- life balance through less time spent away from families and less ‘dead time’ that meant more was being achieved in work hours.

There is clearly a powerful business trend whereby organisations are becoming more cost- conscious, eco-aware and looking to truly start to work smarter not just harder. Technologies such as telepresence and videoconferencing are set to be big players in shaping this. According to Frost & Sullivan the worldwide videoconferencing systems and services market reached $1.63 billion in 2007. However it is set for explosive growth to a staggering $4.2 billion by 2012, as more companies understand, adopt and realise the benefits of this new approach to working and telepresence becomes a more integral part of businesses communication strategy.

For further information on Total telepresence solutions from TANDBERG please contact:
Iain Baker
Tandberg UK
T: +44 (0)1784 274600 ext 6014
E: uk@tandberg.com