The High Cost of Finding Nothing
IDC attempted to put a dollar value to the situation in a report entitled, "The High Cost of Not Finding Information," which demonstrated that an enterprise with 1,000 knowledge workers can lose anywhere from $2.5 million $3.5 million annually in intellectual rework, time spent searching for non-existent data, and failing to find existing information. The lost opportunity costs, however, are even greater — an additional $15 million in lost revenues.
"While the costs of not finding information are enormous, they are hidden within the enterprise, and therefore, are rarely perceived as having an impact on the bottom line," said IDC analyst Susan Feldman. "If decisions are made with poor or erroneous information, then they put the life of the enterprise at stake."
In this article, we take a look at the cause of such huge losses among the Fortune 1000, assess where organizations are at on a scale of information maturity, and look at what technology exists to resolve these issues.
One of the major areas of information loss is the corporate intranet. These go through a cycle of massive data compilation to gather a multitude of facts on the intranet, followed by initial enthusiasm by users around the launch of the site. But that quickly wears off and the amount of time and investment in the intranet quickly falls off. Within large companies, intranets typically become static, and the data within them is stale, poorly indexed and difficult to find. As a result, departments tend to make their own little intranets.
"Someone has to maintain these rogue intranets, and they tend to absorb a lot of time," said Shari Shore, Computer Associates (CA) business intelligence director. "This is a huge issue as these kinds of intranets have no corporate standards to keep them simple."
Not having an intranet, however, is an even greater problem. As companies don't have a simple way to communicate to employees, they tend to deluge the e-mail system with messages about trivial matters. You can end up with the ridiculous situation of minor changes to the dental plan or the health plan generating huge amounts of e-mail. This kind of material, as well as general announcements, briefings and updates are better served on an intranet or portal forum.
A Web-based portal, for example, can be established with sections to deal with specific issues. Within large companies, a specific window can be set aside for a message of the day from a senior executive. Another section can exist for each department with content provided daily by the department head. Whatever the needs of the business, the intranet can be tailored to meet them with pages and links for HR, health plan and other types of data that employees might need.
Arriving at such a point, however, necessitates the existence of a certain level of internal information sophistication. And the unfortunate fact is that most companies are in poor condition in this regard.
According to Datamonitor's Information Delivery Maturity Model all organizations lie somewhere on an information scale. Below Level 1 are those organizations that are either drowning in data, wasting a lot of time accessing data, have little idea what's really going on in the business and/or are unable to access business data without heavy reliance on IT or a large volume of hard copy reports.
Level 1: Centralized Access to Data
At this level, data may be centralized and accessible, but a data glut exists that isn't very useful or relevant, there are often multiple versions of many documents, and it's hard to know who created the information or what system it came from.
Level 2: Trustworthy Information
At this level, information can be trusted and can be traced to known sources. However, the information delivered is not necessarily relevant to specific areas of responsibility, and there is no real way to explain the patterns that may exist in the data.
Level 3: Relevant Information as Knowledge
At this level, rules and/or predictive analysis has been applied to sift through the date for relevance and patterns, but there is little or no intelligent assessment of those patterns, the business advantages/disadvantages of the data are not interpreted, and no automation is present based on this knowledge.
Level 4: Intelligent Action
This is more of a theoretical level than an actual one as no company is currently at this level and the technology is only now being developed to make it possible. This level would apply predictive and rules technology to automate routine decision making activities. Executives would handle exceptions or the non-routine and be moved from the day-to-day up to a more tactical level.
CA's Shore estimates that 10 percent of companies are still below Level 1, trying to figure out where data is. Another 20 percent are at Level 1, 60 percent are at Level 2, and the remaining 10 percent are at Level 3. She believes that CA's CleverPath portal has arrived at Level 3, and could make it to Level 4 by the end of the year.
One of the big barriers to attaining that goal, though, is standardization of a portal feature known as a portlet Basically, portlets are small areas of a portal that are tailored to specific information or formats.
For example, there might be a part of the home page that is a weather feed, a message of the day, a newsfeed or some other dynamic feature. The two main standards for this are JSR 168 and WSRP. However, both are server-side standards and most companies tend towards client-side additions. Client-side portal work is much easier in the short term, but has the downside of requiring a lot of changes. Working on the server-side portal may be more difficult, but it has a big integration payback once everything is standardized.
In the meantime, the number of companies offering portals has dwindled. According to IDC, enterprise class portals are available from CA, Oracle, Plumtree, IBM WebSphere, SAP and a couple of others. But it is ultimately the success of the standardization movement will determine how soon organizations can make the transition to Level 4. Once there, they will have gone a long way towards eliminating the losses incurred due to information inefficiency.
"It behooves the enterprise to provide the best information finding tools available," said IDC's Feldman, "and to ensure that all of its intellectual assets have access to them, no matter where they reside."