business value & ICT - Orange Business Live Blog

Mobile industry driving growth in China

Recent figures from released by China's Ministry of Industry and Information Technology (MIIT) reported that mobile and data telecoms in China is still booming. The report said that revenues for the mobile sector were CNY 373 billion ($54.2 billion) in the first 10 months of 2008, up 15.7% on the same period in the previous year. Data revenues in the same period were CNY 66 billion ($9.6 billion), a year-on-year increase of 38%.

The total volume of telecoms business, including infrastructure investments, rose to  CNY1.85 trillion ($269 billion) in this period, a whopping 22.5% compared to 2007. Further infrastructure investments are expected next year as mobile operators roll out their nationwide 3G networks.

Overall telecoms service revenues in the period January-October 2008 were CNY 680 billion ($98.9 billion), a year-on-year increase of 8.1%. Pulling down the revenue figures are the results from the fixed-line and long-distance phone markets, which were actually down 7.9% and 6.1% respectively in the year. Together these two markets make up around 30% of the total telecoms market. Data communications is the fastest growing telecoms sector reflecting China's new leadership in the broadband market, but it currently only makes up 9.7% of total service revenues.

There is clear evidence of fixed mobile substitution in the MIIT report's details of new subscribers. While nearly 80 million new mobile lines were added in the first 10 months, over 14 million fixed lines were terminated. The process might even be accelerating, with 3.2 million new mobile users in October 2008 alone and a decline of 1.7 million fixed line users in the same month. Numbering 627 million, there are now almost double the number of mobile subscribers to the 351 million fixed line users in China.

Sernovitz on social media disclosure: “the only way to be successful”

The next presentation at BlogWell after Ken Kaplan's Intel presentation and John Earnhardt's description of what Cisco was doing on the video side, was Andy Sernovitz's presentation about disclosure best practices. Disclosure is utmost important in social media usage within firms. This ethical issue has to be thought through very carefully by social media managers, and not just by lawyers. "Disclosure is essential", Andy said, it is "the only way to be successful". But he also insisted that "disclosure is easy". It is about "saying you are and who you work for". In essence, it means that you have to say “I work for such and such and this is my personal opinion”. This applies to you blogging on behalf of your company and can also apply to you managing bloggers doing the same thing on your behalf, be they internal or external. As a matter of fact, it is also fairly applicable to you when blogging for yourself on your personal blog in case you have a full time job somewhere else. It’s a matter of honesty and transparency, which is very much in synch with the early versions of what used to be called netiquette.

Andy went on saying disclosure needs education: few people understand these ethical issues as social media becomes more popular. It's normal because at the beginning this kind of tools were limited to a number of well netiquette-educated people who came from the web world. As it opens up to other people, there are loads of people "who never had the opportunity to talk openly on the outside". Andy Sernovitz and the Blog Council therefore developed this teaching tool to start a community discussion. The idea is to lead by example and to provide 6 checklists to adapt, teach and evolve. It is aimed at corporate teams and agencies alike. 24 companies participated in the creation of this checklist, and it took 4 months to refine it. It can be found at http://www.blogcouncil.org/disclosure.

There are six main big ideas which make up this disclosure best practice document:
•    first: disclosure of identity,
•    second: personal/unofficial blogging and outreach,
•    third: blogger relations for outreach campaigns and rules of disclosure
•    fourth: compensation and incentives
•    fifth agency and contractor disclosure (when agencies are hired, one has to make them enforce the rules Andy insisted)
•    sixth: creative flexibility, as long as they know it is marketing ...

Andy considers that these 6 ideas are as many opportunities to "raise the bar" and to "keep social media in the blogosphere clean". It has to be stated, Andy added, that compensation also depends on the type of product or service that you are selling. You may download and use this document as long as you respect the rules described on Andy’s Blog council pages.

Intel's Kaplan: "Social media is not something to fear but to embrace"

There were three other sessions at BlogWell, an event dedicated to Corporate blogging which was organised by Andy Sernovitz in San Jose on October 28, 2008 (please refer to this other article if you want to know more about session number one on blogging, at which the speaker was John Earnhardt from Cisco). All the sessions were devoted to real-life business cases and they all brought compelling examples from the field -- hence my decision to commit these minutes to paper in this blog. These notes were taken during the meeting, I hope that there won't be too many mistakes; should you spot one or two of them, feel free to comment and I'll be happy to correct my text. This particular article will be about session 2 and Intel's Ken Kaplan's presentation on how to develop a Social Media initiative.

Ken's presentation was entitled "from grassroots to global scale" and was dedicated to describing the four steps towards a fully fledged adoption of social media as per the feedback from the initiatives launched at Intel. Here are some of the key messages that I was able to capture on the fly during the conference:

1. "Social media is not something to fear but to embrace" (I think we should frame that quote, it's so true and tale-telling. At a later stage on this very blog I will comment on a recent TNS survey which was carried out in Europe and describes that state of fact)
2. Who owns the brand? Ken's take here is that it should be (in that order)

a.clients
b.employees
c.not brand managers

I suspect that Ken - or I for that matter - has nothing against brand managers though. What he means by that is that they should be facilitators as opposed to Ayatollahs.

Ken went on describing Intel in a few bullet points:

• 80,000 employees as of October 2008,
• strong culture of innovation,
• Intel's mission is to "keep Moore's law up and running".

The next part of the presentation was dedicated to the four phases necessary for a big logo to develop a "social media" initiative (for those who weren't listening, social media is the new terminology replacing "2.0"; 2.0 has probably been used to the core and ended up meaning all things to all people. Social media is really about the appropriate usage of the collaborative web for communications).

According to Ken, there are four stages in the development of social media initiative:

• stage one is the age of "pioneers". Pioneers are a core group of 30 to 40 people who endeavour to initiate the social media initiative, mostly internally,
• stage two is that of the "settlers". They are enthusiasts issuing guidelines, launch an experiment and implement external blogs. Stage one is usually rather inward looking,
• stage three is that of the "shift to online" with "significant advertising dollars",
• the last and final stage is that of the global scale; the Nirvana of social media.

Pioneers start with the launch of internal blogs, they tend to be easier to launch for "you can let things out and be harsh". Intel's CEO started blogging internally in 2004 (he indeed was a true pioneer!) and he now blogs monthly. The leading pioneer at Intel was a Josh Bancroft. Josh moved from IT to become the social media Guru at Intel (check http://www.tinyscreenful.com for details).

Settlers are the ones who started external blogging. Intel's audience being in IT it was a bit like turkeys voting for Christmas. They went on setting up 15 blogs, and 60 bloggers embarked on that project. Five different languages were covered (!). Audio podcasts were added (dubbed "chip chat"; the pun is intended or so it seems I believe). Flickr and YouTube were also used to "break down silos" hence enticing people from across the organisation to work together pro-actively. The "open port" IT community was opened in 2007 and "it started off as mostly Intel, now it's 20% Intel, and 80% non-Intel".

The "shift to online" occurred at the beginning of 2008 (how amazing after all this time that I am still surprised that in web terms, one year is already history; it's probably because it's not really true though). That's about the time when Intel "Exited direct TV ads in mature markets" and subsequently Intel shifted "1/3 of its 'Intel inside' programme to its online activities. The challenge was -- surprise surprise -- the cultural differences across regions.

the last and ultimate stage of development of social media usage within Intel is that of a global scale. At that stage, Intel users started using twitter and Yammer and other micro-blogging platforms to communicate better internally and externally. There was an awful lot said about micro-blogging at the BlogWell and Blogcouncil (un)conferences, and the emphasis seemed to shift very much to this kind of new technologies for spreading the word aka word-of-mouth marketing. I wouldn't probably venture to call it a better means of communication though as Ken did, but it's certainly is a different means of communication.

Questions and answers session

A person in the audience asked about what kind of metrics Intel was using to measure its success: Ken Kaplan replied by saying that Intel had created something people wanted in order to engage with them. Ken would "love to create a benchmark. Right now [he is] still collecting the data". Another question was about whether all this was looking like chaos: Ken's response was that the tools are all out there. But the global scale is about educating; and yes, "it does get chaotic!"

Another question was about the blogger ecosystem, and whether external bloggers were required: Ken explained that the "'open port' community is about Vmware etc. that sessions were planned and that they wanted to do more of that.

External blogging and legal compliance was another important question which was asked in this questions and answers session: Ken insisted that there was "no moderation at all within Intel, and that all the emphasis was on educating the lawyers" (and not the users).

Removing Human Latency from Business Processes

Let’s take a quick virtual survey.  Everyone reading this post that will be increasing their IT budget in 2009 please raise your hand.  OK…yes, just as I thought…not a single hand.  It’s been “do more with less” for several years now, but the current economic conditions are driving this home more and more everyday.  The problem is, we have been investing in ITIL, 6-Sigma, LEAN, etc., for so long now, we are reaching the point where we cannot get much more out of our people and processes without a major shift in thinking.  This is where human latency comes in.  It is a term that has been floating around for the past year or so, and the new collaborative tools available are making it possible to actually look into reducing that issue.  For purposes of this discussion, human latency is the lost productivity due to the inherent lag time caused by people in our business processes.  A simple example will illustrate how human latency can cause major delays and issues in productivity.  Your company is a leading manufacturer of widgets.  Your ordering process is well automated, but getting the orders to the shop floor to the customer requires that someone receive the order, process it, bundle it, ship it, and bill it.  While this might only take 60 minutes of “people time”, it takes 8 hours to process because the workers have to check queues, prioritize, and execute.  Using tools such as Microsoft Office Communication Server 2007 and IBM Lotus Sametime 8, businesses can leverage their technology investments to reduce the people time needed to complete the order (60 minutes to 45 minutes, for example), but also reduce the latency in the process to reduce the time it takes to get the order out the door.  Your 8 hour turnaround can now be reduced to 6 hours, 4 hours, or less.

How can software do this?  Simply by enabling workers to be more efficient and in turn, make your processes more efficient.  In this case, time lost can be due to the assigned resource being on a break, resources not checking their work queue every 5 minutes, the resource being overloaded at that time, supplies/inventory not being on hand, etc.  Utilizing the collaborative tools available, we can provide the person who is sending the order to the shop floor the ability to see who on the floor is able to get the widgets off the shelf and bundled right now, in real-time.  Using a single interface for IM, presence, phone, etc., the workers can easily have their status (available, busy, on break, offline) visible to anyone who needs it.  Based on this, the order can come in and be assigned to the most available resource.  Instead of waiting for a resource to acknowledge and take ownership of the request, the requestor can simply assign it to a person based on presence availability.  The worker is then alerted on their handheld device of the assignment, and they are on their way to making your customer happy.

The beauty of this example is that you are able to make IT an enabler of the business.  The profit centers of your organization will see IT making them more efficient and productive, which will allow you to look to utilize new and exciting technologies to enhance the business.  By solving a single business problem, IT is able to add tremendous value not just to that business unit or process, but the entire organization.  Once you demonstrate the value you can bring with collaborative solutions such as the one cited here, other areas of your organization will want to find ways to utilize the solution.

Would you choose between slavery, bribery and theft to keep your job?

How far are you prepared to keep your job? Findings from a recent survey suggest that staff will do almost anything – and if they can’t, they will take sensitive company data in order to secure further employment.

The Cyber-Ark survey of 600 office workers in Wall Street, London’s Docklands and Amsterdam found that a third would double their hours AND take a pay cut to keep their job. If you think that this is undying love for their employers, think again. This is self-preservation. According to Cyber-Ark, which is not surprisingly a security firm, “…these workers are using their IT privilege access rights to conspire behind their bosses’ backs to download vital, useful and competitive information to take with them if and when they get the push."

And alarming number of people have already sifted through competitive corporate data and ready to walk out of the door with it should they be made redundant. Over 70% said that if they did get the chop they would take that data to the next employer. There are a quite a few revealing results but they should be taken with a large pinch of salt…

Fixed mobile substitution to continue apace through economic downturn

UK-based market watcher Analysys Mason says that fixed mobile substitution will continue to grow throughout the economic downturn, and predicts that enterprise spending on fixed voice services will shrink by 15% next year. The economic turmoil will only contribute around 1-2% of the decline of enterprise fixed voice, with the remainder being a direct consequence of fixed mobile substitution.

The report author, Margaret Hopkins, says that the economic downturn will focus enterprises on maximising cashflow and they will look to audit voice networks to find any wastage. This will result in reduced revenues for fixed line voice operators through the disconnection of unused lines and number ranges. Also with capital expenditure being generally cut back, hosted voice services are likely to strengthen in popularity.

Hopkins believes that reduced capex spend will also persuade more enterprises to adopt mobile-only solutions. Because the cost of buying VoIP phones is upwards of €480 per desk, with €300 running costs and €180 depreciation, some enterprises might believe it cheaper to provide users with mobile phones, now that the price of mobile calls has come down significantly. Further, mobile operators are making substitution an even more attractive prospect with services that offer reduced or free calls within the enterprise and basic PBX functionality.

However, mobile-only solutions don't work quite as well for multinational companies as international calling in particular is quite costly. A better solution in these cases is to route calls over the enterprise converged data network as much as possible. These requirements are driving the popularity of fixed-mobile convergence (FMC) solutions. Analysys Mason agrees, and forecasts that spending on FMC services will grow with a CAGR of 41% through to 2015, albeit from a fairly low base.