Cost Cutting vs. the Decentralized Enterprise, Part 1

By Paul Waadevig
Senior Consultant, Unified Communications
Frost & Sullivan
January 2009

Since 2000, the rise in the virtual - or decentralized - enterprise has been staggering. At the heart of the virtualized workplace is the "virtual worker." The virtual worker is not necessarily remote or telecommuting, but they may be. Virtual workers are simply those who communicate with the enterprise through technology and are physically separated from others in some way. Different examples of a virtual worker include:

  • Physically located in a different location from direct reports, managers or team members.
  • Telecommutes full time or part time.
  • Is located in a regional office and has frequent communication with the head office.
  • Is a "road warrior" and must communicate from various locations.
  • Is a member or leader of a multi-regional team.

 

The current global economic downturn will be the first major test for the virtual enterprise model. With many companies cutting travel and implementing layoffs, the remoteness of many workers can promote a downward spiral of productivity and morale. Let's face it, when times get tough, companies circle the wagons and ask their employees to "make do" until the crisis passes. But in a decentralized company where it's impossible to get everyone in a room, how can the c-level keep diverse knowledge workers motivated to pick up the slack for those who have been let go? Let's be clear, after receiving goodbye emails from friends and colleagues, an email from the CEO telling everyone to "buck up" isn't going to do it.

Corporate culture is extremely powerful. The rules of the game, what behavior is ethical and accepted, the mood of the organization, and the enthusiasm of employees are all contained in the culture. So, culture can be a powerful, hidden asset or it can be a liability - a time bomb waiting to go off. If your leadership team has not pro-actively created a corporate culture to support the company's purpose, then chances are that the culture is a hidden liability.

http://www.culturebuilders.com/understanding_corporate_culture.htm

Stopping the Downward Spiral
The market has recently been shocked with a number of highly publicized layoffs. Even Microsoft announced it will go though its first major layoff since becoming a public company. With this kind of economic news, your employees are probably concerned that they may be next, or worse, they take the "there's nothing we can do so why try?" attitude. Sales numbers are probably down, and this can have a significant impact on account executive compensation, even for the "superstars." Ultimately, these factors lead to the downward spiral.

Solutions are limited:

  • With sales down and budgets tight, increasing compensation is difficult or impossible.
  • The c-level team cannot guarantee anyone's job in this environment.
  • Perks, such as travel, are being trimmed.

 

The only solution which addresses the morale issue in the virtual workplace while maintaining costs is a comprehensive plan of communication best practices. Conferencing service providers, such as ACT, provide audio, web and video services with little upfront capital expenditure. This allows the c-level to address issues effectively in real time.

Why is this important now? I would argue that statements like, "why use video when an audio conference call will do?" are more dangerous to your company during down economic times than good ones. It's is precisely during bad times that your organization needs reassurance and a sense of camaraderie. This can be video conferences from the c-level but should also include increased use of web and audio from the mid-management level to keep everyone informed.

It Can Be Done - Creating a Sticky Workplace Without Increasing Costs
In 2008, Google was voted FORTUNE Magazine's "Best Place to Work For" for a second year in a row. Only a few of the responses on the survey are related to pay, benefits or other traditional measures of satisfaction. Instead, Google has fostered a corporate culture of openness and learning that engages its employees in a way that a paycheck never could. Videoconferencing has played a large part in empowering management in fostering their culture.

For example, Google has instituted TGIF meetings every week. TGIFs are an informal company-wide weekly get together which include a preview of the week to come, a recap of the week's big events, and a question and answer session. While every week is a little different, the highlight of TGIF is always the Question and Answer section; no question is off-limits. Many of Google field offices have taken to hosting their own TGIFs, with senior leaders from Mountain View joining when possible either in person or via videoconference1.

For the techies in the group, Google's engineering tech talk program is a vital part of their engineering knowledge transfer efforts. The program features world-class engineers from both within and outside the company who share their ideas, best practices, and technical acumen across a wide range of topics. Googler volunteers organize several talks a week at most engineering offices, and engineers at other sites can attend these internal talks remotely via videoconference connections2.

While Google's initiatives may beyond the needs of some companies, we certainly have something to learn from their example. In Part 2 of this series, we will discuss some practical examples to help create a sticky culture without breaking the bank."

1. http://www.greatplacetowork.com/best/100best2008-google.php
2. http://www.greatplacetowork.com/best/100best2008-google.php

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