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December 6, 1999

Real -Time Reality
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Few industries understand the need for instantaneous information better than the financial-services market, with its constant need to monitor economic conditions and trends and respond to them by buying or selling properties. Even delays of seconds can cause losses. Nasdaq, for example, was one of the first organizations to adopt enterprise application integration and publish-and-subscribe technology that lets traders watch for specific events and push through transactions instantly.

Securities firm Jefferies & Co. in Los Angeles is using BackWeb's push technology to warn customers of potential buying opportunities, replacing the telephone calls that traders used to make. Mike Alex, Jefferies' senior VP of trading technology, says that if a trader has five customers for arbitrage swap trading, for instance, he has to call all five. "By the time he makes a call to the fifth one, the opportunity has disappeared and the fifth one's [mad] that he's last," he says. "Push technology lets us push it to all customers immediately."

Perhaps more important, BackWeb helps the company manage all the traffic generated by real-time communications hitting its traders' desks. It runs on traders' desktops, requiring no additional software or even an open window. "There's a big competition for screen space," Alex says. BackWeb simply pops up important messages on a user's screen, and they don't go away until the user has read them.

That helps traders spot critical news amid massive internal communications coming over Jefferies' Lotus Notes E-mail system. "Each individual in the firm receives so many messages, they hardly have time to go through them," Alex says. "The important information gets caught in the quagmire of the Notes system."

Not that BackWeb is the only way Jefferies communicates with its customers. The irony is that while the Internet is making real time possible for some businesses, it's not quite real- time enough for Jefferies. The company offers a variety of direct connections, such as leased lines, to its major business customers, with few of them using the public Internet. Reliability and speed are top concerns for those customers, but the company is building up its Internet offering-a new site called Client Connect that publishes research, indications of interest, and news. A trading system is a few months away.

Connecting systems is one thing, but connecting one person to another is also critical. Businesses are using real-time collaboration technology to train employees and to help them communicate with one another, replacing costly and time-consuming travel for training and meetings.

Proctor & Gamble Co. has set up a series of "collaboration rooms" that incorporate the latest in videoconferencing, collaboration, and E-mail technology, letting product managers from around the world hold idea-generating and production meetings in real time. The rooms, first implemented in P&G's beauty-care products division, are meant to serve a business mandate to develop and bring to market new products faster. They're working. So far, the company says, the initiative has produced a 50% decrease in new-product concept development time, as well as improved knowledge transfer and decision-making, and decreased travel costs.

The collaboration also extends outside the company: Proctor & Gamble has an aggressive supply-chain strategy that incorporates real-time communication with its supply-chain partners on both ends-large retailers, to get real-time sales data, and its Asian manufacturers, to get real-time production data. The company will use data pulled from vendor forecasts to ensure that Wal-Mart, for example, only gets shampoo as it needs it, so neither P&G nor the retailer has inventory sitting around.

Kraft brought in Centra Software's Centra real-time collaboration system to help bridge the gaps among employees scattered around the country. Centra lets employees share visual information in real time, including Web pages, presentations, and whiteboards. Kraft has deployed Centra to some of its sales force and is testing it for its manufacturing group and administrative, sales, and marketing people at its headquarters.

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