The Future of the Virtual Enterprise

By Rod Newing

When Ross Sedgewick, Director for Global Applications Marketing at Siemens Enterprise Communications, started out in his career, the people he worked with physically surrounded him within 20 feet. Now he is based in Toronto and the team who work for him are spread 6,000 miles apart, in San Jose, New York city and Munich.

This dramatic change is possible because of the concept of the ‘virtual enterprise.’ This is an approach to information and communications infrastructure that uses software and internet-based communications to replace dedicated proprietary hardware. It allows people to work together across the boundaries and removes the limitations of location, geography and physical space.

At the heart of the virtual enterprise lies unified communications, which combines all forms of communications services into a single central server that communicates with a single piece of software on each user’s computer. These services include voice communication and voicemail; electronic mail; audio, video and web conferencing; text messages; and instant messaging.

It can only work in conjunction with a well-managed high-performance corporate network running the Internet Protocol (IP). Every employee throughout the world can be managed and supported form a single central server, such as Siemens HiPath 8000.

“People are now able to communicate and work together seamlessly, as if everyone was truly in one place,” says Sedgewick, who is now Director for Global Applications Marketing at Siemens Enterprise Communications. “As a virtual marketing team, we can all see each other’s availability through Siemens OpenScape, which will finds us, regardless of where we are or which telephone we are using, whether mobile, home, office, hotel or remote office. It is the ‘glue’ that holds that team together and allows us to bring the best minds to address issues, even though physically we are distributed very widely.”

The main benefits of a virtual enterprise are flexibility and agility. It is possible to quickly and remotely provide individuals, tens or even hundreds of employees with the services and resources they require through the network to make them immediately productive. The organization can very quickly and easily scale, expand or move, without the restrictions associated with the physical boundaries of a location or site.

A virtual enterprise also increases agility and business response by enabling a high level of collaboration. It provides people with software tools that allow them to find each other, contact each other, find information and work together across physical boundaries. This allows it to quickly reach out and respond to new opportunities or solve problems by leveraging people and resources anywhere in the world.

Communications and software are all based upon open standards, including a service oriented architecture. Compared with traditional proprietary technology, it is easier to deploy and integrate, gives more choices, uses more readily available skills and lowers the lifetime cost of ownership.

Virtualization means breaking down the old ‘four walled,’ site-based, hardware-centric communications model and moving to a more versatile, globalized and distributed model. Users can be deployed ‘on-demand,’ anytime, anywhere. Presence and collaboration brings flexibility and agility by tapping the knowledge, skills, authority and resources of the entire organization and readily applying them in real-time to business problems and opportunities.

“For example, if I were a customer service rep, I can connect my laptop wirelessly into our corporate IT network anywhere in the world and plug in a $29 USB headset,” says Sedgewick. “Within 30 seconds have my IP-softphone enabled, my full agent desktop loaded and be connected to our customer relationship management system. In the old days the company had to run wire to the desk, put in special purpose telephone gear.”

A virtual enterprise also improves employee satisfaction and retention and makes it easier to attract the best talent. This especially applies to younger people, who expect employers to provide access to modern software-based communication tools. Studies frequently reveal that a higher degree of job satisfaction results from the ability to work from multiple locations, be mobile or be home-based.

The main obstacle to the virtual enterprise is the cultural shift required. Employees must learn to motivate themselves to work and manage their time unsupervised. Similarly, managers must learn to accept that their staff are more productive when they are unseen. Just because an employee can be seen sitting at their desk, it doesn’t mean they are working!

The other obstacle is a legacy infrastructure built upon proprietary hardware. However, most enlightened organisations will be migrating away from that anyway.

“Virtualization is starting to take hold in those sectors, like professional services, which need to quickly and effectively form and reform workgroups, including their own customers, around specific projects or contracts,” says David Molony, Principal Analyst for IP Enterprise at Ovum, the Telecommunications and IT analyst company. “Companies initially deployed IP products and services to help cut costs and to simplify their networks. Now they are looking to use it to make their staff more effective, both for the company and so that they can work and manage their own working lives more easily.”

Adrian Brookes, Vice President for large enterprise and applications strategy for Siemens Enterprise Communications has been operating within a virtual enterprise environment for eight years. With global responsibility, he works mainly from home in the English countryside, within easy reach of an airport. He uses a broadband connection, Microsoft Outlook, instant messaging and Siemens OpenScape.

“I can work and have access to people, information services wherever I am,” he says. “Most people I deal with are also utilising virtualization. It has been made possible by the spread of xDSL technologies, but we have a little way to go before wireless technologies are adequate. I can work better at home than if I am in the office and I don’t feel isolated by not physically meeting people, because I can use video to talk with them face-to-face. Most importantly, as I have to participate in conference calls well into the evening, I can plan and manage my day better.”

 “As organizations have to deal with flexible working, a more mobile workforce and teams of people from inside and outside of the business, they need tools to bring them together in a coherent collaborative manner,” says Clive Longbottom, Service Director at Quocirca, an analyst company. “A suitable environment will not only deal with these issues today, but will also provide a platform for future developments in the virtual enterprise, such as virtual storage, virtual servers, software-as-a-service, grid computing, virtual datacentres and utility computing.”

Biography: Rod Newing
Rod Newing is a freelance journalist who writes for the Financial Times, The Times/Media Planet and other publications. As a chartered accountant and business graduate who has worked as a line manager and management consultant, he specializes in writing about the strategic business implications of technology.

Tags: communication software, communicatuions, IP, siemens, virtual enterprises, voip