R U Ready 4 IM?* (Translation: Are You Ready for Instant Messaging?)

Previously known as a teenager's tool for keeping in touch with friends, instant messaging—commonly referred to as IM—is now becoming popular in business, from insurance and financial services companies, to online merchants, and manufacturing.

But in most cases the corporate IM movement is not started because the CIO had an epiphany about the business values that instant messaging can provide. In fact, many times senior management associates IM with viruses, hackers and time wasted chatting online. And while some of these concerns are valid, specifically regarding viruses, most senior managers' concerns reflect fear of the unknown.

"Most senior executives don't even know that instant messaging is happening," says Jeff Whitney, vice president at Boston-based IM Logic, a corporate instant messaging provider. "Once they realize it is happening, they move from denial to anger because they realize they have no control of applications on their systems—a scary thought for an IT executive. And then they move to action."

In most cases, IM usage starts at a company in a grassroots movement where a group uses it to connect to other workers in distant offices. Eventually, more users (both internal and external) join the IM revolution, and before the IT department knows what's happening, a few hundred or thousand users are sending quick messages back and forth.

Occasionally, IT management takes action by banning the use of IM until the company can assess the situation and come up with a corporate solution. But as reasonable and as level-headed as that seems, not only is banning IM usage nearly impossible but it is sure to anger a large portion of the IM'ing employee base. According to a study conducted by Osterman Research (Black Diamond, WA), a market research company, only 23 percent of companies are actively blocking instant messaging traffic.

And that anger sometimes generates calls to the CFO or business unit leader because many employees actually use IM to reach clients and serve customers. "It's not just for socializing," Whitney adds. "As soon as companies start checking with the people that are using IM, they are realizing that people are using it for real business."

Whether it is for communicating with clients or with the colleague down the hall, IM is pervading the corporate workplace. At Fusura (Wilmington, DE), the online auto insurance partnership formed in 2001 by AIG (New York), Kemper Insurance Companies (Long Grove, IL) and Prudential Financial (Newark, NJ), the IT development team uses instant messaging to exchange ideas, ask questions and contact other developers located in different offices. "Instant messaging is our primary method ofcommunication," says Tom LaStrange, CTO, Fusura. "If you can't just yell over the workspace wall, IM is what you use for short questions and answers."

Fusura, like many other financial services companies, is helping to lead the enterprise IM charge. "We are seeing a lot of interest from financial services and insurance companies," says Jeremy Dies, offerings manager for IBM's (Armonk, NY) Lotus SameTime corporate instant messaging application, which also includes videoconferencing and collaborative document functionality. "Another area is healthcare, where companies are actually logging messages for knowledge management purposes."

IM & Compliance

One reason why financial services and healthcare companies seem to be leading the charge into the corporate use of IM is because they all have to be compliant with regulations that address communicating with customers. Broker/dealers have to record all electronic transactions, including IM. And many home-office insurance employees use it to communicate with insurance agents about policy facts, premiums and claim status—all potentially private and regulated communications.

"Insurance and healthcare companies have to be compliant with HIPAA, so we are seeing a lot of interest from those markets," says Brian Curry, senior project management director for AOL (Dulles, VA) strategic business solutions. AOL launched its corporate IM solution, Enterprise AIM (AOL Instant Messenger) Services, late last year. "AIM can track and route all instant message correspondence, and that is very important for compliance," Curry adds. Enterprise AIM Services offers the AIM Enterprise Gateway, a product that is deployed behind a company's firewall to provide a greater measure of control over AIM within the enterprise.

"Insurers are coming on board because many of their financial planners manage securities for clients, and those communications have to be recorded," says Glen Vondrick, president and CEO of FaceTime Communications, a Foster City, CA-based provider of IM applications. FaceTime's solutions extend the use of mainstream IM networks, such as AOL IM, Microsoft MSN, and Yahoo!, as well as enterprise IM networks such as Lotus SameTime, for business purposes.

While Fusura developers use it for internal communication and, according to LaStrange, are more productive because of IM, other insurers use IM for communicating with business partners. "Time-critical issues are prevalent in all businesses," says IM Logic's Whitney. "And a tremendous amount of businesses are geographically dispersed. If your competitor can communicate with their customer in an instant and you can't, you are at a competitive disadvantage."

Amica Mutual Insurance Co. ($2.9 billion in assets, Lincoln, RI) is using IM for customer service in its online policy application and claims reporting. "We use instant messaging to offer another channel for service," says Lee Valentini, director, service center operations, Amica. "The dominant usage is in our online application for new customers that are filling out applications. We saw that as people go through the application process, we were losing people because they were stuck on a question and they didn't have an easy place to turn."

A potential policyholder on a dial-up connection would have to log-off and call Amica for help, essentially minimizing any of the advantages of offering an online application. "With instant messaging, we can respond immediately," Valentini says. "Often times, the type of user that begins filling out an application online is not the type of person that is inclined to pick up the phone."

Currently, Valentini says that Amica is seeing about 1,000 IM sessions a month, not an overwhelming volume of traffic by any means. As for IM sessions during claims reporting, Valentini admits that there isn't much usage since most claims are still reported on the phone. Amica is using FaceTime Communications to manage its real-time communications and Web-inbound IM-routing capabilities for its 100-seat corporate office Service Center. Specifically, Amica is using FaceTime's Instant Message Director and public IM gateway service.

As for ROI on its instant messaging project, Valentini says that carefully managing expectations is important. "Sometimes the expectation is that Internet technologies," such as IM and e-mail, "will reduce the call center traffic," he says. "That is usually not the case and we have not seen a reduction in traffic. But that was not our objective. We wanted to capture more of the people we were losing during the application process."

Another benefit from instant messaging is a new term called presence awareness, or presence management. Basically, presence awareness is simply knowing who is available and who is not. This can be useful for a call center rep who is managing an IM session and has a complicated questions that has to be referred to a representative with more expertise. With an instant messaging application running, the user can see who is available and can take the appropriate action.

Presence management is an added benefit of instant messaging that "is a new thing that is starting to gain some traction," according to Ken Jaffe, CIO for MetLife Investors (Newport Beach, CA), a subsidiary of MetLife ($302.5 billion in assets) that sells variable and fixed annuities through non-traditional channels such as financial planners and banks. "While IM is a great communication tool, in large enterprises it also adds value because you know at a glance who is at their desk."

According to Lotus' Dies, presence awareness may be one of the biggest benefits of IM. "If you see one of your colleagues online, or a business partner, you can instant message them immediately and you know they are there," he says. For instance, with SameTime's collaborative document viewing capability, a user can IM a colleague and both users can view a document at the same time.

"I have developers in California, Colorado and here in Wilmington," says Fusura's LaStrange. "Instant messaging is a great way to contact people, but it's also a great way to see who is available. It is standard practice in our group to sign on when they start working. Almost half of my IMs ask 'are you there?' And when you receive a yes, you either walk over or pick up the phone."

Despite the benefits of instant messaging, there are risks with IM apps that are not corporately managed—primarily security (viruses), compliance (IM recording and monitoring) and privacy (transferring personal data through a non-encrypted IM gateway).

Is IM Right 4 U?

"While IM is definitely a component of our platform, it was definitely not a 'no-brainer' decision," reports MetLife Investor's Jaffe. "On the one hand there are add-on security/monitoring tools for outside IM products," such as the public AOL or MSN IM apps, "but they're expensive and still have security issues. On the other hand, the field of 'good' behind-the-firewall IM solutions is somewhat limited," he says. "We finally implemented a strategy with a product that allowed for us to have our own hosted solution with data retention capabilities and monitoring tools that actually hooks into our wireless strategy. It has been a big win for our business partners." MetLife Investors chose WebMessenger, Inc.'s (Los Angeles) WebMessenger Mobile Platform (WMP) to connect to producers. WMP is carrier-grade, client/server software that bridges a variety of wireless networks and mobile devices and supports with public IM systems.

The benefits of having a corporately managed IM system, as opposed to letting employees chose their own IM application, include monitoring, logging and increased security, according to IM Logic's Whitney. "Most IM applications allow file transfers, but that is how viruses are spread," he says. With an IM application that is controlled by the company, "you can turn off the ability to transfer files.

"Also, a corporate IM manager allows you to track who is using it and what they are using it for," Whitney adds. "You can monitor how much of the network is using it, and you can allow only certain people to access the public IM," such as account managers who need to communicate with business partners outside the company's firewalls.

At Amica, Valentini says the carrier chose FaceTime to address many of the aforementioned concerns. "We were definitely worried about our customers' information being available on the Internet," Valentini says. "We wanted to assure our customers that anything that has their private information is contained behind our firewalls." As a result, Amica decided to implement the FaceTime IM applications on a server that runs at Amica (as an option, FaceTime does offer to run the applications in an ASP model). "When our customers send us an instant message, it is not an open channel," as it would be through a public IM application. "FaceTime came and set everything up behind our firewall. If maintenance needs to be done, they have to come to our offices."

But at Fusura, LaStrange says that since his department's use of IM is primarily internal, there hasn't been a need to implement a corporate solution. Currently, his team uses AOL. "We chose AOL by default because it was the one that had the mind share," he says. "We are careful not to exchange proprietary information or files over IM. Anything that is proprietary or longer in nature is sent by e-mail."

Greg MacSweeney is editorial director of InformationWeek Financial Services, whose brands include Wall Street & Technology, Bank Systems & Technology, Advanced Trading, and Insurance & Technology. View Full Bio