The benefits of a virtual world

Slowly, companies are leaving the physical world behind to cut costs, improve communication, and find new ways to collaborate. Scores of virtual platforms exist on the Internet and are used for everything from entertainment to business to socialising.

An estimated 300 million people worldwide have registered for participation in some form of this activity, according to Kzero, a virtual world marketing and development company. In 2008, according to trade group Virtual Worlds Management, venture capitalists and other investors bet nearly US$600 million on more than 60 software producers involved in this fledgling technology.

In most applications, anyone can register for free to create an avatar. An avatar can be customized down to the smallest detail to look like the person operating it or it can veer wildly from the physical reality. Communication is conducted with a blend of text, chat, and mixed media.

Translation devices let people surmount language barriers. Data files can be shared instantly. Movement is controlled in real time by the person behind each avatar, and also through scripted animations that allow for increasingly realistic movements — instead of looking stiff and motionless, avatars can shift in their seats, for example, or follow the script cues for other smooth-flowing gestures.

Although viewed as novel and innovative, for much of the past five years or so virtual worlds were mostly pigeonholed by the media as another way to social network — a multidimensional, more anonymous version of MySpace or Facebook.

Almost completely neglected was the value of the virtual world as a tool for business, for example, in bringing together global workforces instantly at any time, offering an opportunity for far-flung teams to share and pore over findings, conducting sophisticated simulations, and training new recruits at a fraction of the cost of in-person sessions.

IBM estimates that, with an investment of roughly $80,000, it saved more than $250,000 in travel and venue costs for a recent corporate Academy of Technology event and enjoyed more than $150,000 in additional productivity gains, because these virtual participants were at their computers and able to dive back into work immediately at the conclusion of the meeting.

Certainly, IBM could have enjoyed similar cost savings by holding these sessions as Webinars or teleconferences — in other words, with people communicating face to face via video, viewing exhibits and illustrations — but company executives much preferred the rich and compelling full-motion graphics in the virtual world as well as the ability for participants to instantly share their insights about particular pieces of information and change content in real time.

Indeed, modelling difficult-to-illustrate ideas and products and sharing them with prospective clients or internal teams is one of the more attractive aspects of virtual worlds to companies.

Northrop Grumman Corporation –a US firm, for example, has used this technology to generate mock versions of expensive and complex — and highly classified — defence equipment planned or under development.

Using a virtual network, Northrop has been able to keep customers closely involved in the design and engineering of critical projects and to lead simulated operational training sessions.

The employment search firm Manpower Inc. is among the most innovative organisations with a high comfort level in the virtual world. The company began using Second Life in 2007 to reach and organise people who had already been initiated into the virtual world.

In Manpower’s Second Life office, thousands of visitors and job seekers from more than 50 countries have already experienced avatar-to-avatar communication through employment fairs, live events, and seminars. Manpower even helps applicants learn how to become more businesslike in their new, unfamiliar avatar form, including lessons on dressing their virtual alter egos in professional attire.

Despite successes in the corporate world, virtual environments are still probably some years away from mainstream acceptance. In March 2009, research firm Gartner Inc said in a report on emerging technologies that it will take at least two to five years before virtual worlds become prevalent for business applications.

By then, companies may not have much of a choice: The need to cut travel, training, and meeting costs, gain substantial access to global talent, trim back internal redundancy, and increase communications among departments that were once isolated from one another will force organisations to find new ways (and new worlds) to do old tasks.