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 / First Quarter 1997 / Issue 6(originally published by Booz & Company)


The Wired Enterprise: Here Come the Intranets

"At first you have this organic model of growth by imitation, where good sites begat satisfied users, who begat better sites, in a kind of virtuous cycle,'' said Brett Monello, Silicon Graphics' manager of corporate Web systems. "The other thing you need is a validation of this whole process in the culture. When your chief executive will stand up and say, 'This is a Web-based business, get used to it.' That's a formal validation."

At Silicon Graphics, every project has its own Web site on the intranet, and the result is fewer meetings, fewer phone calls and less routing of documents, paper or electronic. There is also less tolerance of ignorance. "If a Web page exists with all the information and an employee shows up at a meeting without having checked that, you will see a rejection of that kind of behavior,'' Mr. Monello said. "Checking out the Web allows you to have more productive meetings.''

As at many companies with a decentralized management structure, Silicon Graphics consists of many work groups that are dependent on each other to meet their goals. "In many cases, the success of a particular division is tied to its ability to create a program that it expects other people to participate in,'' Mr. Monello said. "More and more, the Web is the way groups search out and let those who they will be dependent on know what is expected of them."

In such a Web-centric environment, a group's ability to generate compelling Web sites is key. "To the degree to which your Web site is ugly or boring, you will be more or less successful,'' Mr. Monello said. At Silicon Graphics, there is now a premium on artists and other creative people not normally counted among program developers.

Other companies have determined that, important though it is, Web-site development is not one of their core competencies, and is better outsourced. The U.S. Web Corporation, a company formed last year in Santa Clara, Calif., to develop sites on the World Wide Web for commercial clients, now says that half of its revenues comes from creating intranets.

A cookie-cutter approach to intranets will not work. Each must mirror the culture of its company. At Silicon Graphics, every desktop computer is configured to be its own Web server, and employees are free to create sites devoted to the best sushi in Silicon Valley and other arcana. But such an approach might not work well in a more traditional corporate culture.

Intranets also shape culture. At Levi Strauss, for example, the intranet helped move the company from an internal environment of competition to one of collaboration, and brought it closer to its goal of becoming a "learning'' organization, said Dianne Woods, Levi's vice president for global strategies and organizational development. "In a learning organization," she explained, "employees capture their knowledge and learnings and make that widely accessible." With the intranet, she added, Levi's "employees learn from one another and they work smarter, with an ever-increasing capacity to respond to their environment.''

Sun Microsystems' management has always prided itself on a rapid decision-making process, one that draws on many participants' knowledge of a trend rather than depending on a particular senior executive who is waiting for hard evidence. Sun's intranet fostered this approach, said Mr. Raduchel, the company's chief information officer.

"We learned from our Japanese partners the value of being participative in decision-making,'' he said. The intranet "allows you to be participative and asynchronous; I don't have to have everybody in the same room or on the same conference call. We can make a decision in a day rather than in a month. That's part of our ethos."

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