Is Telepresence Worth the Big Bucks?

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Distance adds management difficulties. Cultural differences play a role, which has led some North American companies to opt for closer outsourcing alternatives like Latin America.


But cultural differences aside, much of communication goes beyond words, and thus is lost in telephone and e-mail discussions. According to two information systems professors cited in this Knowledge@W. P. Carey article, more than 60 percent of communication is nonverbal.


The two academics, Harvey Shrednick and Ajay Vinze, predict more mainstream adoption of video conferencing. In particular, they think companies will want to use ultra-sophisticated -- and ultra-expensive -- "telepresence" solutions from vendors like Cisco. Vinze says Cisco's TelePresence Meeting system offers an experience in which "you can see a sweat bead on someone's forehead." (Another system with similar high functionality and cost is HP's Halo.)


In a March 2007 IT Business Edge interview, Wainhouse Research analyst Ira Weinstein likens the difference between previous iterations of video conferencing and telepresence to "watching TV on a small set as compared to a big screen on the wall with surround sound."


While simpler video conferencing systems might do for some remote meetings, Weinstein says that telepresence is preferable for more strategic situations.

This is the kind of thing that a typical enterprise would deploy in eight or 10 strategic locations. ... Imagine a geographically dispersed development team charged with finding the next round of ideas and solutions for companies, such as a drug company or a car manufacturer. These guys don't get together very often, and every extra day it takes to come up with a solution is another day to market. They go into telepresence rooms, interact, meet for hours and hours, and virtually interact face to face and still go home to their families at night.

Rob Enderle blogs that video conferencing -- whether it's telepresence or simpler systems -- won't be successful if employees resist it or if organizations using such systems aren't given the credit for travel savings. He writes:

If you don't have the authority or executive backing to require that the system be used instead of travel, or if you can't get credit for the savings, but will be charged for the hardware and upkeep, then you probably won't be happy with the result.

Nonetheless, Enderle adds, for organizations committed to making it work, the ROI can be "amazing." In addition to direct savings on transportation and accommodation expenses, he says, companies gain productivity that is typically lost during transit. Video conferencing means "no missed connections, lost luggage, airborne in-plane viruses or long lines to the terminals."


Another point working in video conferencing's favor, notes Shrednick of W.P. Carey, is a generation weaned on YouTube. He says:

(Young people have) gotten more used to visualization and video than my generation. That's how they do business: they want to see people.