--> Gill Blog: September 2004

Gill Blog

Monday, September 27, 2004

JeMM Consultants a Gill Advisor

As the complextion of organizations undergoes a transformation, change management plays an increasingly important role. As change becomes a big topic, those who have set up an efficient platform to deliver solutions will rise to the top. In this regard, I am pleased to announce that JeMM Consultants has become a Gill Advisor, and provides a great platform for those who recognize that change has to be managed in a logical way. If you go to the site, you will see that the connection between our companies started a while ago - the Managing Director of JeMM is Jennifer Morris, and the other Director is Jo Verde, who has been a key contributor to the blog since we launched. We're very happy to welcome JeMM into our advisors circle.

Tuesday, September 21, 2004

A State of Preparedness on a 7-24 Basis

I have attended a number of conferences where I bump into municipal planners who discuss new ways to perfect their current mousetrap, which in their case is usually a business continuity plan for their region. Invariably, you hear lots of "Ah-Has", and "Oh-Hos", and tend to see lots of folks nodding their heads while holding their chins in moments of new discovery. I was thinking the events of the last month could really make all of us pause and see who's really doing this better than anyone.

The string of devastating hurricanes that have hit Florida over the past month are truly unprecedented and really left no part of the state unscathed. Charley made an unexpected right turn to paralyze the Gulf coast; the slower moving, but equally destructive Frances wreaked havoc on the Atlantic coast; while Ivan brought unprecedented death and destruction to the Panhandle. To get some idea of how truly monstrous these hurricanes were, just click on these links to see Frances and Ivan.

Despite the destruction, there is much to be said about how emergency services in the State of Florida have handled everything. I periodically check out what's happening in Tallahassee (still have friends there 17 years after graduating), and came across this page on the website. It is a well laid out page that provides lots of emergency management information including recent stories as well as the locations of local emergency shelters - simple, yet very well presented and extrememly effective.

For each incident that occurred, we saw a carefully coordinated effort between Federal, State and Local governments to get folks back on their feet as soon as possible. Unlike most other places that do their planning based upon the slight probability that a disruptive event may occur sometime in the future, the Sunshine State operates knowing that just as college football season returns every August, so too does Hurricane season, and they do all in their power to stay one step ahead.

Thursday, September 16, 2004

Connecting Insurance, BCP, and Teleworking to SMEs

Okay, so I feel that I have to make some connections here. Once in while, I have to do it just to make sure all the topics we discuss are still directly or indirectly linked. For some reason, I've been thinking a lot about small to medium sized enterprises (SMEs) lately and just wanted to see how well they're subscribing to rules of a rapidly changing economy.

Let's start with teleworking. Recent statistics confirm that SMEs are at the vanguard of the movement:
Interestingly, the greatest increase in the number of teleworkers (57%) occurred in medium-sized businesses (100 - 999 employees), with no change in the largest firms (1000+ employees).
Really not surprising when you consider some of the cultural barriers associated with the adoption of teleworking in larger firms. In fact, my friend Jo Verde sent me the following tidbit from Samsung Business that really seems to drive the point home:
A MATTER OF TRUST: British managers simply don't trust their employees to work efficiently from home, with two-thirds of them (66%) stating that 'concerns in employee productivity' is the key inhibitor to their providing the option for staff. In comparison with Spain, The Netherlands and Sweden, only 46% of the UK companies polled by Samsung Business Communications currently offer the facility to employees. That's considerably less than Spain at 53%, The Netherlands at 72% and Sweden at 78%. "UK management seems to have an ingrained mind-set of mistrust when it comes to employees working from home," says Andrew Saunders, head of product marketing at Samsung Business Communications. "It's clearly not based upon the technological ability to do so, rather the worry that if they can't physically keep an eye on employees, they can't control what they're doing. We're lagging behind our European neighbours and need to address the issue, not least to ease congestion on our roads."
Despite the gains in teleworking, seems that SMEs are still lagging behind Fortune 500 companies in the adoption of business continuity planning as indicated in this article by Len Biegel, who cites a recent survey conducted by the American Management Association:
While the largest of the Fortune 500 companies are more prepared than others, the truth is that medium and small businesses have just as much at stake...but are not nearly as well prepared...a disturbing 36% of medium sized businesses do not have crisis plans and are not prepared for an unexpected catastrophe of any type.
This gap points to bigger problems looming on the horizon. As insurers increasingly require their clients to have some type of bcp program in place, those who fail to comply will at some point be left high and dry.
Leading insurers, including AXA, are in talks with the Government about plans to make it a legal requirement for companies to have in place business-interruption arrangements before they can secure cover.

...The move is part of efforts to encourage City firms to take the threat of a potentially crippling event...more seriously and to shift financial responsibility from the Government on to the companies...Despite high-profile events such as the September 11 attacks, research suggests that many companies are still failing to take serious risk-prevention measures.
Connections fortified - time for SMEs to take action.

Monday, September 13, 2004

Cultural and Structural Issues Slow the Rollout of Teleworking

By this point, it seems clear that the benefits of teleworking speak for themselves, and government has taken a leading role in adopting new standards of working. Despite all the good news, there still seems to be a lingering lag in adoption. In order for teleworking to gain traction, those touting its benefits must address concerns that arise on two levels; one cultural, and the other structural. The cultural issue is one that we have discussed previously, and has much to do with fundamentally changing deeply ingrained practices associated with the traditional workplace.

Specifically, this requires employers to remove themselves from factory-model based expectations of work (see our last post on Ricardo Semper to find out more). Theoretically, this would seem like a no-brainer, but in practice, things aren't always as easy as they may seem as reflected in the following quote from a piece about the adoption of teleworking in San Diego.
There are several reasons why telecommuting has been slow to catch on nationwide, according to experts:
- Many employers are uncomfortable having employees out of sight.
- Some employees are reluctant to give up the social contact they have with co- workers at the office.
There is little doubt it will take time for cultural issues to reconcile themselves, but in the short term, adoption issues should be addressed by analyzing a couple of key infrastructure issues: the availability of broadband, and shoring up security issues associated with private networks.

In the first instance, we periodically hear about teleworking goals remaining unfulfilled due to the limited availability of broadband. For instance, the State of Georgia is currently experiencing these difficulties as it tries to roll out teleworking programs for state employees:
Currently, only about 1,500 Georgia state employees are teleworking at least one day a month, two years after Gov. Sonny Perdue said the number would be 25,000 - or roughly 25 percent of the state government's workforce - by 2005...Perdue spokesman Derrick Dickey said that part of the problem has been that, because of budget woes, Georgia has not been able to afford to pay for home computers or high-speed Internet service for state employees who want to work from home
Despite the slower rollout of broadband it is clear that it is making good progress, so this type of concern will gradually be allayed, especially as the economics and business case become stronger. This quote also alludes to a more recent limitation that has emerged even with the proliferation of broadband – organizational reluctance to giving employees free access to private networks. This issue is highlighted in the following article from the UK:
but many companies might not be so happy to see sensitive data accessed like this, and might restrict employee access to information via a virtual private network (VPN). VPNs make it appear that your remote PC is directly connected to the corporate LAN, though data is actually going backwards and forwards through a secure pipe over the Internet...And this might bring up another problem, which is that Internet service providers (ISPs) are starting to take a dim view of people using VPNs on a consumer service.
I think this last point about ISP reluctance seems to be the key, because it seems that great advances in security are being made daily. One area where great progress is being made concerns SSL VPNs:
Many companies are turning to a relatively young technology, Secure Sockets Layer Virtual Private Networks (SSL VPNs), to provide a full range of remote access while ensuring maximum security...Unlike traditional IPSec VPNs, SSL is a higher-layer, application-independent security protocol. Since it is already included in the browser, no additional client software is required, giving users the benefit of ‘anywhere access’ to Web, client/server and file sharing resources from an Internet café, airport kiosk, wireless device, or PC on someone else’s corporate network. SSL VPNs provide clientless access by using Java, with or without terminal services, to access a full range of enterprise applications.
Perhaps it will take a concerted effort on the parts of enterprise as well as those developing security-related technology to address reluctance of ISPs, but when these issues do sort themselves out, it should be smooth sailing ahead.

Monday, September 06, 2004

Saying Goodbye to the Factory Model of Work

I received an interesting email from a friend who responded to my last post on teleworking. The body of the message was brief and to the point: "This might interest you." I took one look, and agreed. It was a brief piece about changing work patterns and in it the author uses the example of Ricardo Semler, CEO of Semco. In the piece, the author quotes Semler:

"Anyone who can eliminate the stress of an overbooked schedule, arrange a workweek to sleep according to biorhythms rather than a time clock and enjoy a sunny Monday on the beach after working through a chilly Sunday, will be a much more productive worker. It will ultimately benefit organizations because employees will find equilibrium in their professional, personal and spiritual lives. This isn't just an avant-garde approach to running a company. It's a sound strategy for business success and gaining competitive advantage."
This was closely aligned to the teleworking discussion we have been carrying on for some time now. In our approach, however, we tend to tie teleworking to technology or risk mitigation as opposed to discussing the obvious lifestyle benefits. This bit stimulated my interest, and I had to find out more about Mr. Semler.

As I discovered, he has successfully transformed the theory of flexible work patterns into practice, and 25 years after committing himself to this approach, it has yielded a substantial return on investment.
Semco's revenues have jumped from $35 million to $212 million in the last six years, and the firm grew from several hundred employees to 3,000—with employee turnover of about 1 percent
His management theories might seem radical to some CEOs who generally tend to subscribe to a more textbook approach to management, but Semler dismisses such traditional approaches wholeheartedly. When CNN asks whether he thinks management is more an art or a science, he says:

"More an art. The scientific, technical aspect is basically secondary. The graduate schools have difficulties keeping up with the times because they consider it too much of a science."
He raises even more eyebrows when he first debunks the whole notion of "career opportunities" as being artificial, and then points out the great disservice many employers do to their enterprises by treating employees like kids. These views are cited in this interview he gave to CIO Insight:

"Basically, most career opportunities are fraudulent. The idea that I will hire you, I will train you, I will want to know where you want to be in five years, and then I will give you that better job is totally out of the question."

"...when you start treating employees like adolescents by saying that you can't come late, you can't use this bathroom — that's when you start to bring out the adolescent in people."
Semler, who graduated from the Harvard Business School at the age of 20 to take over the family business in Brazil, provides some of his insights in this audio interview (definitely worth a listen), where he discusses his most recent book, The Seven-Day Weekend. In the context of our discussion, his views suggest that one way in which teleworking can be rolled out more effectively is for managment to make some fundamental changes.

The old model that assumes that the only way in which employees can be productive is to have a manager standing over them, has to be completely reworked. Effective management has to ultimately recognize that performance is not necessarily measured by "time at the desk", but simply by fulfilling a pre-determined list of deliverables. Location and schedules effectively become irrelevant.

Thursday, September 02, 2004

2004 Teleworking Advances

I had lunch today with an old friend who manages institutional real estate portfolios. He was talking about fundamental changes not only in development trends, but in holding patterns and asset types. He said that although the sector will always be strong, it's complexity and ever changing dynamics always makes the daily trip into the office interesting.

He asked what I thought. I said "Don't underestimate the spread of broadband. It'll drive a whole lot more than faster music downloads." He gave me a bit of a blank look and we promptly switched topics to this week's Republican Convention. Did I offend him, or did my answer just seem a little wacky and misplaced? I didn't think so, after all when the use of broadband expands, so to will the range of tasks that can be done on an anywhere/anytime basis, making the old office seem, well, old, as suggested in this article:
For most information-type jobs, the addition of broadband equips the home office equally as well as the employers' cubicles. "I can be sitting at home and it's like being in [the] office" was a typical comment in last year's report.
The really interesting changes will come when broadband becomes truly ubiquitous. Is it possible? Can the economics possibly make any sense? Well, according to this article, not only is it possible, but it's about to descend on Philadelphia like a blanket, and the math actually works!

The ambitious plan, now in the works, would involve placing hundreds, or maybe thousands of small transmitters around the city — probably atop lampposts. Each would be capable of communicating with the wireless networking cards that now come standard with many computers...Once complete, the network would deliver broadband Internet almost anywhere radio waves can travel — including poor neighborhoods where high-speed Internet access is now rare.
At the end of our lunch we tossed around the idea of taking in a basketball game in the fall, or sneaking away for one more round of golf before the summer ends. We shook hands and as he was leaving, he turned back to me and said "Broadband, eh? You got me thinkin' Gill."

Isn't the future is just totally cool?