Whip, Beat, and Stomp Your Data Into Submission

We all know that the information is out there, but who knows how to find it? Consider, for example, Ames Department Stores, headquartered in Rocky Hill, Conn., a discount retail chain with 452 outlets: Until recently sales managers there had to spend as much as a day combing through numerous databases, file servers, and Web documents just to pull together a basic sales report. Sadly, Ames is not alone in its info-maze dilemma. According to a recent KPMG survey of 423 large companies, 67 percent of respondents claimed they had too much information to manage and 56 percent complained of having to “reinvent the wheel” every time they started a new project.

So how do you deliver the information your employees need in a way that’s, well, easy? Increasingly, big companies are investing in souped-up intranets that consultants call enterprise portals. Think of a portal not in the sense of Yahoo’s consumer service but rather as a single, well-organized gateway to all the information services and resources within a company. At their most basic, enterprise portals provide access to human-resources staples like 401(k) forms and employee directories; more advanced versions add critical applications like sales force tools, collaborative features such as whiteboards, and company and industry news. It all gets delivered through a single webpage that each employee can personalize to match his or her job and information needs.

San Francisco-based Plumtree Software built a $1 million portal for Ames that provides easy access to all of the company’s databases on one page, letting sales associates monitor data as it comes in, spotting trends and responding instantaneously to match supply and demand. The result: a nimbler and more efficient effort to stock the shelves in a timely manner. Ames CFO Rolando de Aguiar expects a return on investment — in inventory reduction and other cost savings — of at least 20 percent this year.

Stories like Aguiar’s have made portals a hot subject for corporations. The Delphi Group, a Boston-based market research company, estimates that 60 percent of the world’s 2,000 largest companies either currently have a portal or will be building one in the next six months. According to Delphi, sales of portal applications are expected to reach $730 million in 2001, five times more than in 1999. “Providing a portal is becoming part of the way you do business,” says Hadley Reynolds, Delphi’s director of research.

The enterprise portal market got its start in 1998, when Plumtree launched the first software product aimed at enabling companies to build their own Yahoo-like directories of categorized information. During the past three years, dozens of portal software providers, including Viador and Epicentric, have entered the market and added increasingly sophisticated features, including personalization, collaboration tools, and the ability to integrate more and more legacy systems. At last count, there were more than 100 vendors in the market (see “Portal Builders“).

The spur for this growth has been twofold. First, enterprise portal software is finally capable of supporting hundreds of thousands of users, something the earliest versions couldn’t do. Second, Web technology provides a shortcut for tying together legacy applications and information systems. Instead of trying to get old applications to exchange data with one another (an extremely costly and difficult undertaking known to IT folks as application integration), a portal takes the data you want from each existing application and displays it on a webpage.

IBM’s homegrown portal — nicknamed W3 for its private Web address, w3.ibm.com — may be one of the most sophisticated in existence. From W3’s homepage, IBM’s roughly 325,000 employees worldwide can view a host of IBM-related information, all tailored to their individual interests and responsibilities. The portal provides company and industry news, transcripts and videos of recent presentations, and a library of online training courses. But that’s just the tip of the iceberg: W3 is the front door to dozens of business applications, from procurement to contract requisition, as well as discussion boards and collaborative workspaces. It also links to a searchable database, called BluePages, which helps employees find subject-matter experts within IBM. Currently, W3 gets 450,000 to 500,000 pageviews a day, and more than 120,000 employees have created personal profiles for the directory, according to IBM’s intranet director, Mike Wing.

The payoff? IBM estimates that W3 helps the company save more than $500 million a year across many departments. For example, by simply delivering health-care benefits information online instead of on paper, IBM saved $1 million last year. Even more impressive, by buying 94 percent of its goods and services through W3, IBM trimmed $377 million from its budgets.

IBM has also registered productivity gains. For example, a W3 tool for hiring technical contractors lets IBM employees submit requisitions, state job requirements, and review resumes online, shaving days or weeks off the recruiting cycle. Last year more than 8,900 requisitions went through the system.

Do you need a portal? If you’re a big corporation with thousands of employees, it’s almost certainly an investment that your IT department will be pitching you, if it hasn’t already. And it’s clearly a worthwhile investment. “Portals will become part of the cost of doing business for most corporations over the next four to five years,” says Andy Warzecha, a VP at Meta Group.

For smaller businesses, whose employees number in the hundreds rather than thousands, the investment is probably too steep. However, less expensive outsourced options are available from such companies as SAP and Intranets.com.

If you’ve decided on a big enterprise portal, the planning and technical launch work can take four to six months. On top of that, you’ll need to dedicate IT employees to ongoing maintenance, and you’ll need a staff to oversee the site’s content and make sure new applications are smoothly integrated into the portal. IBM’s W3, for instance, has undergone six distinct revisions since it first launched in 1996. A staff of 30 full-time employees (12 techies, 18 content managers) oversees the portal. IBM’s portal is far more extensive than most, but be prepared to have employees dedicated to ensuring that it all works smoothly (see “Recipe for Portal Success.”).

Building and supporting an enterprise portal is a big — and expensive — undertaking. But in most cases, the payoff for that hard work comes quickly. According to Meta Group senior VP David Yockelson, the average portal project pays for itself in about eight months. “We’re seeing enterprise portals have a huge impact on productivity and cost savings,” says Delphi’s Reynolds. “If your competitors are doing it, in our view, it’s risky not to deploy something.” Yes, that’s a hard sell you’ve heard before, but portals are a simple, proven technology that really does make sense.

Recipe for Portal Success
The work necessary to get an
enterprise portal off the ground isn’t just technical — it’s cultural too. It’s important to plan carefully to make sure your portal accommodates your employees’ habits and your company’s processes, and that it helps people get their jobs done better. Here are tips from experts.

Start small. Don’t try to solve every information problem at once — you can’t do it. Instead, roll out new features one by one, and assess each one carefully before adding the next.

Information begets participation. To get your employees to use the portal, deliver the information or applications they want, whether it’s a sales-lead generator or a 401(k) calculator.

Openness counts. Rather than attempting to control everything on the portal, give employees the tools to collaborate and create on their own — then get out of the way. “If a portal is seen as a publishing channel owned by management, it will fail,” says knowledge management consultant David Weinberger.

Portal Builders
So far, the software providers below lead the enterprise portal market. But keep your eye on IBM, Microsoft, and Oracle, which recently entered the field with less expensive offerings.

VENDOR PRICE OFFERING CUSTOMERS
Epicentric $300,000 for up to 15,000 users Java-based portal platform. Partnerships with 100 Web service firms for tools and content. More than 150, including BankOne, Lockheed Martin, and Motorola
Plumtree Software $400 per user; 250-user minimum Market leader, with 3.3 million users worldwide. Software is highly scalable and can support groups of 200,000 or more users. About 175, including Ames Department Stores, Comcast, Ford, and Procter & Gamble
TopTier Software $200-$500 per user “Drag-and-drop” software feature lets users connect related content items. More than 200, including Baan, Herman Miller, and Rolls Royce
Viador $300,000 for up to 15,000 users Enterprise portal software with especially strong business intelligence tools for analyzing information in databases and data warehouses. More than 360, including Charles Schwab, IRS, Toshiba, UBS Bank, and Verizon Wireless

Get e-mail delivery of Dylan Tweney’s weekly online column at www.ecompany.com/thedefogger.

Want to learn more about building a portal? Check out our Enterprise Portals Web File.

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Whip, Beat, and Stomp Your Data Into Submission