Tuesday 9 September 2008

AI 60 What Do Virtual Worlds Mean for Business?


Source: Knowledge Management Review

Second Life and other virtual worlds certainly get their fair share of headlines - but how many organizations are really using them as a forum where employees and partners can share information, ideas and knowledge? Here, in an extract from Melcrum's report, how to use social media to engage employees, we examine the role that virtual worlds are likely to play in collaboration and knowledge-sharing activities in future.

Exploring the potential of the 3-D web for collaboration activity
The 3-D web - including Second Life - is already being used by some forward-thinking organizations for all kinds of communication, collaboration and knowledge sharing. Others have yet to investigate what happens in virtual worlds - but it's only a matter of time until they do start exploring, according to some experts.

In order to properly understand 3-D web applications and what they're capable of, it's helpful to look briefly at how they developed historically.
"Virtual reality" was a popular concept in the early 1990s, but quickly faded away as the idea reached far beyond the technological capabilities of the time. What was it that made the concept so compelling? Most likely it was the potential to do things that otherwise weren't possible in the real world - to fly in a virtual airplane or even space shuttle, for example.

Now, nearly 20 years later, we have powerful computers capable of producing fantastic 3-D graphics, broadband speeds that allow large quantities of data to be exchanged in seconds, and technology that in effect allows software developers to bring virtual reality to both home and workplace computers. We have interactive video games, activity simulators and three-dimensional modeling tools, and these are based on the same technology as applications such as Second Life, the internet based virtual world.

Uptake metrics

There's been a vast amount of publicity around virtual worlds, or "metaverses” and around Second Life in particular, but is it just hype?
In a 2007 survey into the use of social media for engaging employees, Melcrum (publisher of KM Review) found that the vast majority of respondents - almost 85 percent - said that their organizations had no interest in Second Life.
But that result seemed to be at odds with the reasons organizations gave for adopting social media tools - namely, to improve internal collaboration and to develop internal communities. Second Life and 3-D web technologies are, arguably, the most collaborative online platforms available.

What the 3-D web means for business

In a BBC interview in 2006, Second Life creator Philip Rosedale suggested that: "If you're looking at where our creativity happens, where our collaboration happens, where things will get built first, then undoubtedly in the future they will happen mostly in virtual worlds."


3-D web platforms such as Second Life may be in part about letting people escape from their daily lives through virtual reality, but ultimately it could be the beginning of a dynamic virtual platform whereby people can collaborate, conceptualize, visualize and develop with a level of detail that is as yet unsurpassed.

For example, consider the Amsterdam project on Second Life, which is a pixel-perfect representation of the real city.
Now imagine such clarity applied to the concept and development of your next-generation airliner, data center, training shoe, commercial construction venture and so on.

Through this technology, a truly social, web based collaboration platform, your employees will be in a position to provide important, real-time contributions to a co-developed project in ways that otherwise would not have been possible.
"A growing number of companies have entered Second Life - including Dell, BBC, Nissan, Adidas, IBM, Reuters, Sony BMG, General Motors, Toyota, and ABN AMRO. These are all internationally recognized names that have identified its business appeal," says Neville Hobson, social media expert and vice president of new marketing company, Crayon - which operates from both a real office and a virtual one in Second Life.

"These companies have joined this virtual world for a variety of different reasons, yet all have one motivation in common - the desire to create and develop a personal connection with customers and potential customers in a place where there are no real-world manufacturing or service costs and few barriers to what's possible," he says.

Conversational by nature

Online and social media communication strategist, Lee Hopkins, refers to this connection as "conversational" in nature. It's the informality and unstructured approach to relationship-building which he believes offers so much potential for businesses both internally and externally.

"What 3-D virtual environments such as Second Life and others are showing us is that a new way of engaging and conversing is now technically possible," he says.
What's also becoming apparent, he adds, is that business can successfully be conducted in these new environments - with one terribly important proviso: "It's business, but not as we know it."

Recently, Christian Renaud, senior manager of business development for the Cisco Tech Centre, explained to Hopkins why his company was in Second Life.
"We're finding it extremely useful for communicating and collaborating in a way that you simply couldn't do over the telephone, or using the web, or through a combination of the two," he says. "The risk of not getting in now is much greater than the risk of jumping in too soon. We need to identify the hurdles as well as the opportunities and start working on them now."

Virtual worlds are all about creating "human" contact online, says Hopkins. As a customer, you can go to a physical, real-world store, select their desired product, pay and await delivery.

Or, you can enter a store, engage in conversation with some of the staff, get their recommendations and ideas based on their own experiences, engage in conversation with other customers also in the store, factor their experiences in with those of the shop staff and your own, and make a richly informed purchasing decision.
"The second option is what the new 3-D web allows. What your organization probably has at the moment is a static, two-dimensional website where you basically have the equivalent of an online brochure. Customers and visitors may be able to interact in a limited way with your database, but actual human contact is very lacking," says Hopkins.

"The new web allows you to create a 'space' where new and existing users, staff and prospective users can mingle and share ideas, jokes, and experiences and do business," he adds.

Business conducted in virtual worlds

Plenty of organizations believe that, in time, business could be brisk in virtual worlds and are placing their bets now.

For example, Toyota and General Motors' Pontiac Division have both opened virtual dealerships in Second Life where residents can test drive and buy cars - virtual replicas of real-world car models - for just a few dollars.

For those car buyers, the appeal is that you can customize your car's appearance in ways that are impossible or prohibitively expensive to accomplish with a real car. Meanwhile, for Toyota and Pontiac, the appeal is establishing an early brand presence and developing a car culture among fans in the Second Life community.
Computer Company Dell has taken the virtual selling concept further by enabling residents to build and purchase computers that are then delivered to them in the real world.

Second Life and 3-D web represent a completely new way to communicate with people via the internet. Therein lies a key to the business appeal of Second Life and a strong reason why communicators, internal and external, should pay close attention to what's happening.

The potential for internal communication

A great example of how this technology can be adapted for use inside the organization comes from IBM.

The company is adopting virtual worlds like Second Life, as well as video-game technologies, to train new employees in the company's cultural values, decision-making processes and technical skill sets, and to hold employee meetings.
This potential for virtual worlds to stimulate and foster collaboration and information sharing among employees scattered across the globe is certainly very exciting.

A new way to interact

"Some companies are breaking new ground in Second Life," says Neville Hobson of Crayon, "making connections with many of the early adopters among the Second Life community, experimenting and learning how to adapt business, marketing and communication models to a new, emerging and exciting marketplace."

More companies are joining the fray, he adds, even if no one is quite sure yet what the impact will be on business, society and our personal lives. "One thing there's no doubt about is that there will be an impact," he adds.

"Some companies are breaking new ground in Second Life," says Neville Hobson of Crayon, "making connections with many of the early adopters among the Second Life community, experimenting and learning how to adapt business, marketing and communication models to a new, emerging and exciting marketplace."

More companies are joining the fray, he adds, even if no one is quite sure yet what the impact will be on business, society and our personal lives. "One thing there's no doubt about is that there will be an impact," he adds.

What's a virtual world or "metaverse"?

A virtual world is a computer-based simulated environment Intended for Its users to Inhabit and Interact via avatars. This habitation is usually represented in the form of two- or three-dimensional graphical representations of humanoids (or other graphical or text-based avatars).

The term metaverse comes from Neal Stephenson's 1992 novel Snow Crash and is now widely used to describe the vision behind current work on fully immersive 3-D virtual spaces.

These are environments where humans Interact (as avatars) with each other (socially and economically) and with software agents in a cyber space, that uses the metaphor of the real world, but without its physical limitations.

"Many are convinced that the prospect of running global meetings in virtual worlds at a fraction of the cost is not that far away," he says.

His top tip? Use Second Life to connect existing communities. In a form of trial for this next step, IBM recently used its Second Life presence to communicate and connect with IBM "employees-once-removed" - its alumni network.


"It's a new world out there," explains Borremans. "IBMers don't necessarily work here for life anymore. They leave, they set up their own businesses, they come back as clients or as associates. There's far greater job independence. So we need to stay in touch with those people and keep them in the IBM loop, because we may need to bring them back on board six months down the line."

Staying networked with alumni through social networking application Linkedln was the first step - with nearly 3,000 registered ex-IBMers on the network. But in early 2007, the group invited that network to join them on IBM Island in Second Life, for an interactive virtual get-together and update on what IBM is doing.

Over 250 former employers turned up to the event and Borremans sees this as an encouraging sign of the wider potential of virtual worlds. "It's a different approach to those for which Second Life is more commonly used, but it's interesting to see how you can form a community by basic social networking and then bring that into a virtual world."

Career planning in a virtual world

Keith Brownlie, group head of HR at publishing company Informa, is on a mission to make career planning a more engaging experience for the company's 10,000-strong headcount - and he firmly believes that the virtual world of Second Life is the place to do it.

With that in mind, the company has built its own, private zone in the online virtual world that Informa employees can visit to access Information about job functions, competencies and skills gaps - as well as play football or take on a challenging assault course with their colleagues.

To do so, they need to develop their own "avatar" - an online representation of themselves that can "teleport" Into that zone, the "Transformed Careers Island". In this zone, each building represents a function within Informa - sales, for example, or editorial.

Once Inside a building, they can view a "day in the life" of an ambassador for that function, read and save the competencies required for those roles, and see what training or experience gaps they have in meeting the competencies for the role they want to move to. They can also chat to the ambassadors who man each building, and view internal job vacancies in all of the global Informa businesses.

"As a company, we're in the business of providing our clients with the Information they need in new and Innovative ways, so It's only right that we should take advantage of new technologies to do the same for our Internal employees," says Brownlle.

And, according to Peter Dunkley, founder of Depo Consulting, which developed the Transformed Careers Island for Informa, the company has taken its use of Second Life to a whole new level. "Lots of organizations now use Second Life to hold meetings, but few of these initiatives involve providing employees with the kind of rich, in-depth content that Informa's project does. And what's more, that Information is presented in a way that employees find really interesting - they can just wander around the Island and look at things, just like they would in a store."