Is Enterprise Chat Good for Business?

by | April 7th, 2016

Coke or Pepsi?
Mac or PC?
Slack or HipChat?

If you have immediate responses to all three questions, you probably work for an organization on the avant garde of inter-office communication. Or you work in the tech sector.

Questions 1 and 2 have been sparking debates for decades while question 3 is relatively new to the arena of polarizing arguments. These questions, previously confined to the sphere of “tech,” will soon be encountered by many SMBs interested in the use of these enterprise chat applications in their organizations. This post shares a few key points to help you choose a side when the enterprise chat debate reaches your office.

Enterprise CHAT?

enterprise chat word bubble
Enterprise chat is the term for communication applications for both group and direct chat. Slack and HipChat are two wildly successful applications for this type of messaging, and they are weaning companies off email and onto what we can now rightly call enterprise chat.

“Slack and HipChat… are weaning companies off email and onto what we can now rightly call enterprise chat.”

Is this is a function of a tech workforce that spent its formative years in IRC chatrooms? Is it the result of a growing understanding that verbal and physical workspaces can be replaced? I won’t try to answer those sociological questions. Nor will I make an argument for the superiority of either application. I will touch on key differences: this post is focused on the security, corporate oversight, and accessibility of enterprise chat apps.


accessible enterprise chat

Let’s start with the accessibility of both tools. In the early days of internet chat, there was a substantial technical hurdle to leap in order to participate. The chat solution was IRC (an RFC-defined open protocol). It required a hosted server and familiarity with network protocols. These may not pose a challenge for an IT team, but they are probably beyond the ability of the average person. This barrier to entry and the absence of widely-promoted, enterprise-y applications are reasons chat remained in the consumer sphere with AIM, Live Messenger and later Google Chat.

HipChat can probably be credited with taking the personal chat app and making it professional. It brought a clean, friendly UI with key features:

  • A few user-pleasing integrations
  • Accessibility to users via a simple login
  • It just looked like a business tool

HipChat was widely-used, but didn’t exactly inspire businesses outside tech to swoon. Even after HipChat’s 2012 acquisition by Atlassian, there were issues. The most notable issue was the oft-disparaged history search, but the tool remained in a class of its own. That is, until the recent explosion of Slack.

Slack’s atmospheric rise can arguably be attributed to better accessibility and improved features. These updates to the enterprise chat app have allowed non-technical users access to more functionality, including:

  • Simple reminders
  • A host of out-of-the-box integrations
  • Animated GIFs at your command

The existence of this rival, major player in the enterprise chat market is due to even easier access to advanced functionality. And a little bit of pizazz.

Organizational Oversight

binoculars for enterprise chat oversight
One big question comes up when adopting enterprise chat. Will this benefit the business? The most popular argument is that more chatting means less working. This is an especially valid argument when conversations consist of endless emoji and GIFs.

“…more chatting means less working. This is an especially valid argument when conversations consist of endless emoji and GIFs.”

The main retort is that saving communication time trumps any loss in productivity. This is a fair argument and worth having. Less frequently debated is the question: Do we truly want all this communication on the record?

The benefits of searchable, indexable information are clear to organizations that trade in information. Such benefits are obvious for companies doing business on the web. Formal documents, email, and notes have always been searchable repositories. Now HipChat and Slack close the last gap in searchable documentation: the conversation. When every single chat is “on the record,” the genesis of every valuable idea is traceable, and preserving chronologies means accountability. No one can “forget” they were supposed to perform a requested task.

Is putting it all “on wax” ultimately the right move? The recent Hulk Hogan-Gawker case to shows the peril of this practice, but a Robinhood compliance officer quoted in a Bloomberg piece last year says otherwise. He claims that Slack allows him rein in employees who are getting off track.

For better or for worse this is our world now. What happens on enterprise chat is (or should be) considered precious information. This raises larger questions:

  • Where is all that precious information stored?
  • Will I always have access to it?

Those questions lead to the third consideration for enterprise chat, security.

Information Security SaaS vs. Self-Hosted

securith with enterprise chat lock
The enterprise software market of today differs from 30+ years ago. Until recently, big companies needed hardware and infrastructure to store programs and data. Now, large national and international organizations trust cloud solutions for application delivery and hosting. Think about Salesforce, Azure, and Google Business Apps. More and more proprietary information and communication passes through third party servers. Servers that organizations themselves do not control.

In order to responsibly adopt an enterprise chat solution, organizations must answer key questions:

  • How can we maintain of the software?
  • Can we always access and retrieve proprietary information?
  • Are we satisfied with the security of that information?

Slack serves and stores their client’s information on their servers (or more properly AWS’s servers). Both Slack and HipChat offer full data exports. They have maintained decent security reputations. With some notable exceptions.
Slack’s steep rise in popularity and massive valuation guarantee development attention in the future. Few doubt their codebase will be properly maintained and secured for the time being.

HipChat, perhaps due to its longer tenure, has suffered some notable downtime, but it is taking strides in opening its API to developers, along with other incentives to adoption.

As for data control, HipChat offers a limited export (but provides full access through their API). Slack offers a limited “standard” export for regular enterprise clients, which does not include direct 1-on-1 messages. A “compliance” export provides a total data dump (ostensibly for organizations with regulatory oversight), and is available for Slack-Plus clients.

With all these considerations, enterprise chat is a complex undertaking. There will be organizations that want enterprise chat, but which can’t relinquish control of their communication data to any third party. Fortunately for those organizations, HipChat offers a locally-hosted server which should be a relatively painless spin-up for an IT team.

If you’ve already fallen for Slack’s UI and integrations, Mattermost developed an open source solution specifically for you.  It allows you to bring much of the look, feel, and functionality of Slack back under your control. Both of these solutions offer a slightly more turnkey solution than traditional IRC or XMPP. As such, they are also worth consideration.

Are Enterprise Chat Apps Good for Business?

There’s no denying that workplaces outside the tech sector are beginning to favor online chat. There will always be room for the face-to-face of the water cooler and Coffee Talk. But it’s clear enterprise chat has carved out a niche in business culture. The jury is still out whether having every chat — workplace-appropriate or not — on the record is a good thing. Many employees love Slack, but a backlash is already taking shape.

Whatever choice your organization makes for informal communication, we wish you happy chatting and plenty of cat GIFs.