Shantanu's Blog

Corporate Consultant

October 07, 2003

Instant Edge
Corporates find that instant messaging can be used to good advantage

White goods maker LG Electronics India Ltd’s top managers were alarmed to find that the company had run up telephone bills of Rs. 10 Crore in 1999-2000. True, sales had been growing at a fast clip, but Rs. 10 Crore was too much to simply talk away. At the same time, there could be no compromises on customer care. After some brainstorming on reining in costs, LG’s information technology department suggested that he company’s 200 employees in 50 locations use instant messaging (IM) as the primary communication tool.
What LG now uses is a free Web based IM utility ICQ, shorthand for “I seek you”. It allows users to send notes to anyone else online at that time. By 31 March 2001, the company estimates that it had saved at least Rs. 50 Lakh in telephone and fax charges.
At present, LG is using ICQ internally, but from January 2002, its dealers (accessing and vendors ( will be able to download messaging software form the respective sites. The company now estimates the savings by the end of next year to be Rs. 4 crore.

Nobody questions IM’s potential to emerge as a major communication tool. Global research firm IDC estimates that the number of corporate users will increase at a compounded annual growth rate of 140% form 5.5 million in 2000 to over 180 million in 2004; and they will send almost 2 trillion messages a year. Gartner, another international research outfit, expects organisations using IM internally to generate 40% fewer emails.

You might be familiar with IM through your use of MSN Messenger, Yahoo Messenger or America Online’s (AOL) AIM. Other companies developing IM software include Jabber, Mercury Prime, QuickSilver, 2Way lkimbo, Ezenia, ACD Systems, Bantu and Pune based Ruksun Technologies. Simply download a copy of the free software client for your computer – and you are ready to swap messages in real time.

Today, IM has moved ahead of just providing a text exchange facility to include video, images, voice, document exchange and mobile access for users using both WAP and SMS protocols. With Windows XP Messenger, it is possible to share applications. For instance, you can share a Word file or Powerpoint presentation with your colleagues in remote locations.
Ruskin Software Technologies has recently developed im2go, an IM toolkit that offers a comprehensive set of presence, awareness, messaging and conversation abilities. It has also launched Voice Messenger Force (VMF) with voice and chat capabilities. Windows XP’s messenger offers all the current features and voice, video and online collaboration.

Says Yahoo India country head Deepak Chandnani: “IM can be used as a complete CRM solution. It can also be sued to increase the level of involvement with the brand since the messenger is a sticky property. We believe IM usage will see a quantum jump. This will be helped by the availability of greater bandwidth that will make applications like video instant messaging come alive.” But LG Electronics IT head Arindam Bose disagrees: “We do not think video messaging will be too helpful in a business environment.” So, to start with, these will probably be little more than fun tools.
Others, however, think that if efficiently used, IM’s video conferencing and whiteboard (an interactive, multiuse tool that includes drawing space and a chat box) features can not only lower costs, but also reduce time-to-market. Already, Delhi-based Creatnet Services, which provides technology solutions in supply chains for the apparel industry, is working in this area. Twenty-two-year old National Institute of Fashion Technology (NIFT) graduate R. Gauthaman worked with Creatnet on design development software.
Gauthaman says: “Almost six months’ work goes into making the collections before you see the model on the ramp. Designing itself takes two months. This is when various designers in different locations might be collaborating to fine tune the trims, the cuts, the colour, choice of fabrics, threads, buttons and so on. At present they courier the designs. Delays are inevitable. IM could trim time to put a collection together by almost 25% and bringing it out ahead of the others.”

Shortage of bandwidth is one reason that IM is yet to take off in a big way in India. Yet there are some success stories, with benefits ranging from savings in communications costs to improvements in efficiency.
Let us take the instance of call center Spectramind. It found in IM a useful tool to improve remote customer care and efficiency. It undertook a two-week pilot about three months back and has seen an improvement in first-time resolution of complaints, has closed calls quicker and also improved the quality of service. The input costs have been nil, while benefits include by-products.
Spectramind technology AVP Parminder Singh says: “All messages go into the database. This is analysed and ploughed back for training needs. We also get a list of future FAQ’s.” At Spectramind’s technical help desk, whenever a query comes in at the junior agent’s (Level 1) desk and he is unable to resolve it immediately, instead of asking the client to call up later, he contacts the senior agent (Level 2) on IM to sort out the problem. Nine out of 10 queries are routine, but for the rest IM is a boon, as it not only helps quicker resolution but also generates fresh updates on FAQ’s.

Even consultancy company PriceWaterHouseCoopers (PwC) routinely uses Net Meeting for specific projects and believes that as far as possible employees must ‘chuck phones and use messaging’. PwC e-business practice head Prithwis Mukerjee says: “Call costs are high, hence there is an incentive to look at alternatives. This is where IM fits in. Also, the medium is far richer than phones, s in enabling low cost text, data, voice and video interaction.”

IBM, which uses Lotus Sametime, another IM tool, has seen savings in travel costs, quicker problem resolution and improvement in internal collaboration. However, as IM proliferates, security concerns will also get amplified. Cautions Global E-Secure COO Rajeev Wadhwa: “The biggest danger of IM software is the always on kind of application. These render corporate LAN’s and WAN’s vulnerable, because it is easy to use any of the desktops operating one of these IM’s and attack the entire network. The possibility of emails being wiretapped, confidential folders accessed remotely and passwords being known to unauthorized users is pretty high.”

Elaborates Neel Ratan, partner (global risk management solution), PwC: “IM is inherently insecure. The moment you include voice and video exchange, 64,000 ports, (virtual gates controlling flow of information within an enterprise) are opened, exposing the systems to hacker attacks. Also, a typical communication on IM is not encrypted, neither can the identity of the user be estabillshed, increasing chances of masquerading. The free IM software user information carry a warning that it should not be sued for business-sensitive information. Till better encryption is available, it would be best to limit its use within enterprises.”
This is one reason why Samsung India has not yet installed IM solutions. Says Rajesh Chopra, Samsung India DGM (information systems): “Availability of bandwidth is another reason. Though by the second quarter of 2002, we will install IM solutions. The security testing is currently going on at out headoffice in Koria.” Samsung India is currently using SAP office and a VSAT network for communication at its 35 locations. This has helped bring communication costs down to Rs. 6 Lakh a month from about Rs. 13-14 lakh a month earlier. With IM, it hopes to further reduce it next year.
The risk for corporates may be higher as messages and connection information are maintained on servers controlled by the IM utility provider. Most utilities offer some encryption, but it is not secure enough for sending confidential information.

A disgruntled employee of the US based Internet company eFront made public its CEO’s conversation and ICQ logs, which had information and comments about business partners, employees and Web affiliates. The result was not a happy one for eFront. Partners distanced themselves from eFront and others initiated legal action against the firm. The top management, including the chief technology officer, had to quit following the embarrassing leaks.
Such a situation would be difficult to check. Viruses and Trojans can easily be disguised within files and it’s mandatory for messages to be screened by a firewall. Says Sameer Adhkoorie, country manager, MSN: “IM is just like other software applications, in that it resides on the user’s computer. Consumers should protect themselves with the latest anti-virus software and refrain from giving credit card details and other such information on IM.”
Apart form security, there may be a problem due to lack of cross communication. Ruksun Technologies’ development manager Sharath Embrandiri observes: “Different proprietary protocols are used by IM service providers which hampers inter-operability. If this goes on, IM will remain divided and restricted to proprietary messaging islands.”

Thankfully, all major IM players are part of the Internet Engineering Task Force working on instant messaging and present protocol, but no acceptable standards have emerged from this task group as yet. Other forums include IMUnified, presence and Availability Management, Wireless Village (a mobile IM standards body promoted by wireless industry leaders Ericson, Motorola and Nokia). It remains to be seen who will emerge the winner and how soon others fall in line.
At present, there are third party IM systems that attempt to work around the barriers and establish some form of inter-operable solution. The most notable of these are the open source initiatives from US-based Jabber and Odigo.

But whatever the hurdles, the future definitely looks bright for instant messaging. However, free IM services, particularly those enabling video and voice aren’t likely to be free for too long as they require big investment in bandwidth. Meanwhile, the popularity of instant messaging in corporate environments will continue to grow.
And if economic conditions seriously dampen network investment, the low bandwidth, plain-text version may be the service of choice for some time to come.

Advantages of using IM

Voice, Video, text and application sharing. You can talk, send images and work on files remotely in real time.
Reduce phone and fax bills, and even travel costs.
Undertake remote customer care more efficiently.
Messages can be archived. (Choose File – Save as option.)
Improve internal knowledge and competency.
Improve collaboration, e.g. doctors can use it to know patient status and meet emergencies quickly.
Quick project completion. Web links help in knowing everything from stock quotes to weather forecasts. Simply type the link (for eg. and your friend can click on it to visit the page.

BusinessWorld - 10 December 2001

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