Making the business case for collaboration

Collaboration software can help connect disparate employees, boost team productivity, aid innovation and even bolster a company's bottom line. But justifying the expense isn't always easy. Here's how to make the case.

Senior Reporter, Computerworld |

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Modern collaboration tools promise to connect employees more effectively, boost team productivity and potentially even help the corporate bottom line .

The potential cost savings include cutting travel costs (by substituting video conferencing for team meetings ) and reducing a company's real estate footprint by enabling remote work.

But with various high-profile demands on IT budgets, collaboration initiatives can drop down the list of priorities compared to other enterprise needs such as ERP and CRM systems , which arguably have a more obvious financial impact .

One challenge: It can be tricky to conclusively tie investments to revenue growth. "Convincing business leaders to invest in collaboration and social software can be difficult because such initiatives have broad and indirect benefits, so it's hard to estimate their financial returns," Nikos Drakos, a research vice presidentat Gartner, wrote in a research report.

"Collaboration is never the thing that rolls off of people's tongues to address," said Warren Lenard, vice president of technology and operations at sports retailer Finish Line . The company last year invested in a new social intranet and moved from Microsoft Office to Google's G Suite as part of its plans to bolster collaboration.

"Everybody is concerned – and rightly so – about supply chain and ERP and merchandizing systems and finance systems, because those are the things that are right there in front of your face: H ow do we build our business, how do we increase revenue, how do we increase margin ?

" So there is never a 'good' time to address something like this ," he said,

In some cases , a detailed plan with expected financial returns is required to get a collaboration initiative off the ground , according to Drako s . However, the scope and aims of each individual project can vary and t here are numer ous ways to demonstrate how such initiatives can pay off .

A catalyst for change

For the American Academy of Family Physicians (AAFP) , a speci fic incident served to highlight broader collaboration challenges – and helped push the business case for a refresh of the organization's collaboration tools.

A lack of communication between teams was a longstanding problem when CIO and Vice President Michael Smith joined AAFP in 2015 . There are 18 divisions within the AAFP, but each operated in a "vacuum," he said . "It was almost like 18 different companies working under the umbrella of one organization , and every division was kind of doing their own thing."

The impetus for change came when executives realized that a webinar was being offered to AAFP members by two separate divisions ; in one case it was offered for free and, in the other, for a fee . That led to confusion among members and highlighted a problem with the organization's lack of collaboration practices . It also serv ed a s a tipping point that pushed AAFP to adopt Microsoft's Office 365 cloud suite, including Share P oint and OneDrive.

"There was this kind of epiphany: the organization didn't even realize these two divisions were working on the same webinar and that one was being offered for free and the other was paid ," Smith said . " The members were like , ' W ell , does the left hand even know what the right hand is doing?'"

That mix-up served as a catalyst for the leadership team, pushing to to discuss a broader vision of how to use technology to better communicate and collaborate.

"That was like a slam-dunk for trying to get approval for the overall business case," he said. "So that's been the driver in being able to get buy-in not only from the leadership, but buy-in across the organization that we need to invest in technologies that help us to more effectively work together."

Building a business case with a proof of concept

In some cases, moving from one vendor to another and migrating services to the cloud can reduce software costs . When Finish Line planned its LumApps intranet deployment and a switch from Microsoft tools to G Suite , cost savings were only part of the picture. Instead , it was a proof of concept that swayed senior leaders to allocate the money f o r the project.

The company arrived, almost serendipitously, at a plan to overhaul its aging collaboration and productivity tools. When Lenard was tasked with supplying G Suite business licenses for staff at the firm's digital team, a service provider partner was hired to carry out the work. It also took the opportunity to highlight the benefits of the revamped intranet and a move to G Suite across the entire organization .

A t that point, no money had been earmarked for such an initiative, so Lenard had to convince senior executives to back the project. This was made easier by the fact that it would lower costs .

"I built a presentation and went into the executive leadership team to present this ," he said . " Because we had nothing funded for it, it was out of the blue. As it turned out, this whole migration would actually result in a cost saving for us."

Through a series of workshops and proof s of concept , Lenard built a case for the rollout. No RFP [request for proposal] was needed and senior leaders gave the project a green-light right away.

"I wanted to dazzle them with what we had come up with in the workshops and the proof s of concept : what this thing would look like and what it would do for us, and some extrapolations on how it would enhance our collaboration and efficiency as an organization and really bring us to a world where we would get greater engagement," he said.

"It literally took just one presentation to the executive leadership team – and that's a tough crowd – and they unanimously [said], 'We are in.'"

Office space consolidation : a route to investment

At insurance company Aetna , it was a plan to close down corporate offices – and the resulting  upturn in the number of employees working from home – that highlighted the need for collaboration .

From the outset, spending on collaboration software was factored into the overall cost of the project, said Renee Zaugg , vice president for IT infrastructure and application development at Aetna .

"We were closing down very large offices," she said. "In order to accommodate the service centers being collapsed, we were able to say in the business case [ that it was necessary ] to put in the investment of the collaboration capabilities as part of the investment for the real estate move. So that was a big driver.

" …N ot only did we include the cost [of collaboration software ] in that ROI to shut down offices – so they are getting out of leases, they are saving hundreds of millions of dollars from a real estate perspective – we made sure that the investment for the IT capabilities was included in those net numbers," Zaugg said.

In recent years , the company has rolled out a range of Microsoft Office 365 products – including Skype for Business, SharePoint Online and Teams – as well as Box and Cisco Webex .

As a result of the real estate move, Aetna's network and wireless infrastructure was also bolstered and the ability to stream video enhanced . That was important since home workers would need to join live streams of meetings.

"I included the costs for those investments in the real estate plan," she said. "That was the primary driver. Now, once it is in my base, I have an operating cost that I can actually work off of, either to expand, contract, [or] use new capabilities and services."

That kind of strategy can work for other companies . "I would say leverage real estate as much as you can as one of your enablers to get the investment," Zaugg said. "Large companies choose a real estate footprint, they are always looking at their portfolio. If they are doing any consolidations, use that as an opportunity to get your funding."

Engage with other business units

A common requirement for collaboration initiatives is the need for IT teams to work alongside other business units, particularly communications and HR teams.

Strong engagement from the outset is vital. "We realized that this would never be successful if it was an IT project," said Lenard at Finish Line. "It needed to be a business project, and it needed to have representation from around the business community. "

This meant involving executives from a variety of different business groups. "We had corporate communications, human resources, learning and development, procurement – you name it – just to get a nice rounded group ," he said.

"We probably had a steering committee, if you will, of a dozen people."

According to Drakos , although collaboration and social software initiatives may not be IT projects – the initial drive for a project may well come from another part of the business – IT leaders must be directly involved. "Ideally , the business should own the initiative, but you may need to manage it, as IT is one of the few cross-departmental functions in the organization," he wrote.

"Work very closely with the communications partner," said Zaugg . "So , head of internal communications, what is their strategy to engage employees?

"That's another way to get investment: through the chairman and the office of the chairman and the communications strategy for the firm."

Smith said that a key process in making the business case for collaboration initiative is "talking to multiple divisions." The project to replace AAFP's ag ing intranet portal will be driven by HR, for example. " So IT is going to execute and enable that , but HR owns that initiative, because we're dealing with how employees communicate with each other across the organization," he said.

Other projects have required cross-divisional buy-in, said Smith, with the organization responsible for the initiative – not IT. "IT is responsible for executing it and implement it, but it needs to be owned by the leadership and by the organization. Any project that we've done since I've been on board, I've communicated to my team there is no " IT project " – these are business projects.

"…Getting that buy-in for any project , any investment , any initiative is paramount."

It's important to measure success

In his report, Drakos said it is important to show quantifiable business benefits of collaboration: "Focus the business case discussion on metrics and accountability that relate to financial performance to ensure meaningful dialogue between, and commitment from, all stakeholders," he wrote .

For AAFP, one aim of improved collaboration is the ability to create products that resonate with the most engaged members – i n other words , those more likely to spend money on a regular basis.

When Smith took over his role at the organization, the percentage of " highly engaged " members stood at around 1- 2%. A primary goal was to help the business boost that number . The better collaboration between business divisions involved in product creation and sales – from marketing to sales, finance and more – played a significant role in doing so .

"The better that we can communicate and collaborate with each other, the better that we can focus on providing the products and services that our members need, which in turn should start to show a positive growth in the member engagement," he said.

"So [this meant] going from 1- 2% up to 1 0- 12% [of highly engaged members]."

There are also efficiency gains that can add up substantial ly across an entire company. Smith pointed to the co-authoring capabilities in Office 365 that lets multiple users modify and edit a document at the same time.

"That in itself drives efficiency," he said. "Because, historically, you would have to save your file, you would send it over to somebody else, they would modify it and then they would really save the file and maybe add an appendage at the end with their initials and then it goes to the next person and they do that [too].

"Let's say that it would take you two weeks for everyone to be able to provide input to this document [previously], versus now you could set up a conference call and you could utilize Office 365 to have those same set of people collaborate all at one time and instead of taking two weeks for everyone to provide their comments.

"Maybe it takes two hours and so [there's] a significant improvement in efficiencies just utilizing those tools."

The ability to streamline processes was also an aim at Finish Line, which saw a range of efficiencies.

"Emails from store operations and corporate to the stores and back have been reduced by 90 % , because they communicate now through Finish Line Connect [ the corporate intranet platform]," said Lenard.

There were also less easily quantifiable benefits, such as creating a more collaborative culture with better information sharing. "People are connected: the stores are connected back to corporate, corporate is connected to the stores, and within corporate we are all connected to one another.

"With departments putting up their departmental pages [on the intranet] , we are learning more not just about the departments themselves and what they do, but we are learning about the people in those departments... ," Lenard said. "I t just makes for a more personal environment and that in itself leads to higher engagement, higher productivity and a happier workplace."

Matthew Finnegan covers collaboration and other enterprise IT topics for Computerworld and is based in Sweden.

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