An intranet often gets confused with the Internet. While there are a lot of similarities between them, they really are two different things. Simply put, the Internet is the global World Wide Web, while an intranet is a private computer network operating within a company. Both the Internet and an intranet use similar communication protocols (like TCP/IP) and offer many of the same functional features like e-mail and bulletin boards. One main difference is that an intranet is an internal and private network. Access to a company network (an intranet) is controlled whereas access to the Internet is open to anyone with physical access. Most company intranets are set up to include Internet access as one of the functions provided but the inter company network, or intranet is a separate entity and not part of the Internet.

When they were first introduced, intranets were dismissed by critics as the latest in a seemingly endless parade of technological fads and buzzwords. That soon changed as businesses with intranets began to reap benefits that were apparent to others.

A company may wish to set up an intranet for many reasons. Among them is the speed of communication that can be gained by the broad bandwidths that are used in intranets. These speeds allow for fast e-mail systems and the rapid exchange of documents. The private internal networks offer security and protection in the form of the aforementioned firewalls as well as password-protected access and secure servers. The use of an intranet allows companies to share information internally easily and in so doing to manage the efforts of many employees quickly. Less paperwork, increased productivity, added flexibility, and versatility are other benefits that may be gained through the use of a well-designed intranet. All of this adds up to a bottom line that is attractive in any business decision: the ability to save money and increase profits.

An extranet is a part of a company's intranet that can be accessed by users outside of the company. Clients, vendors, suppliers, and business partners are just a few examples of the types of people who would benefit from this type of private network. They can exchange large volumes of data using Electronic Data Interchange (EDI), share exclusive information, collaborate on joint business ventures, participate in training programs, and share services between the companies. An extranet is a way to telecommunicate and share business information securely without having to worry about it being intercepted over the Internet. This is achieved for an extranet in much the same way that it is done for an intranet, namely through the use of extra security and privacy measures which include firewalls, password restrictions, and data encryption.


Intranets may be set up to provide a company with any of a number of functions. Most of these are related to communications in one form or another and use the same basic computer software applications as are used on the Internet. Often these applications are referred to as Web applications but in the context of an intranet it is important to distinguish between the "web" like functionality and the fact that it is being applied within an intranet and not on the Internet.


The most popular intranet application is interoffice e-mail. This capability allows the employees of a company to communicate with each other swiftly and easily. If the intranet has access to the Internet, e-mail can be accessed through the Internet connection. If the intranet is running without the Internet, special e-mail software packages can be bought and installed so that employees can take advantage of its many benefits.

Electronic Publishing

An intranet has many other different applications that can be utilized by a company. These include the electronic publishing of corporate documents, electronic or Web forms, and interactive database links that allow users to access information. Newsletters, information on benefits and 401(k) enrollment, job listings and classifieds, libraries, stock quotes, maps, historical data, catalogs, price lists, information on competitors' products, and customer service data are just a few examples of these types of applications. In addition, there are several other main applications that are very popular in the intranet format.


Every type of company has to deal with forms of some sort. This is another area where paperwork can become a problem for a business. Intranet servers can be equipped with programs that allow for forms to be filled out electronically. They could also be downloaded and printed out by the users themselves, which would cut down on the time it would take to distribute these forms manually.

Organizational policy and procedure manuals are also handy to have on an intranet. Unlike printed hard copies, online manuals can be easily accessed by all employees at any time. They are also easier to organize online, and can be indexed by subject and attached to a search engine to provide for easier navigation through the manual. In addition, changes can be made more quickly and easily when they are in this format. Converting printed materials to Web browser readable formats is fairly simple and requires either an appropriate html translator or a way for the original word processor documents to be launched with a specific application.

Inter-company Directories

Phone directories are another useful intranet applications. Again, this type of application cuts down on paperwork and the time and money it takes to produce hard copies of these directories. Instead, employee names, titles, duties, departments, phone and fax numbers, e-mail addresses, and even photographs can be stored in an online directory. They then can be easily searched and updated at any time with minimal effort. It is suggested that a few paper copies of the employee directory and other important records be kept on hand in the event that the intranet is experiencing technical difficulties.

Organizational Charts

Online organizational charts are a useful way for employees to see the hierarchy of their company. These charts can describe who reports to whom, the specific duties of a person or department, and the structure of the organization. They can be set up in either graphic or text formats on an intranet and updated every time there is employee turnover or a change in job title or responsibilities.

Chat Rooms

While somewhat complicated, intranets can be equipped with software to allow for live chat rooms or instant messages so that employees can communicate with each other online about work-related subjects. If a company is considering this form of communication, they should first form a policy about what can be discussed in an intranet chat. Chat room moderators and software to log the chats for future reference should also be considered. Despite these options, it is still difficult to see live online chats replacing traditional company meetings anytime soon.


There are many tools at managers' disposal to successfully implement an intranet. These include html editors, database and forms interfaces, java applets, and java script. An intranet must use these tools to be designed well enough to fully maximize its potential. When designing an intranet, careful attention must be paid to the details that will allow employees to find the information that they are looking for in an easy manner. Just because an intranet is only seen by employees and not by clients or the general public, this is no excuse for a company to take the easy way out and cut corners with design. Well-organized intranets with a pleasing graphic design sense are usually more efficient and much appreciated by the employees who use them.

According to intranet experts Anthony Schneider and Christopher Davis, "Successful process-oriented intranets look and work as differently as the processes they enable, but they share several common characteristics. First, they are built on smart information design. Second, they focus on tasks, not documents, and aim to integrate those tasks into distinct processes. Finally, the best intranets encourage collaboration by creating shared and familiar spaces that reflect the personality of the company and create a common ground for all employees."

Since individual tasks are generally a small portion of a bigger task, intranets should be organized in such a way that the related individual tasks are grouped together. These tasks can be simple or complex, but as long as they all contribute to the same overall process, employees will benefit from the easy access to information that this sort of design provides.

Intranets are useful in bringing employees from different departments together. They can even help employees of the same company who work in different locations to communicate more successfully. Through an effective design, these departments can collaborate and solve problems by using the intranet as a tool rather than relying on more traditional business ideas like meetings and conference calls.

The bottom line is that an intranet, like any corporate communications tool, is a reflection of the business that runs it. A company that is well organized will be able to design an intranet in such a way to best suit their needs. As Schneider and Davis state, "As the intranet creates new forms of collaboration, it will challenge traditional ways of doing work and obtaining information. For the intranet to be successful, it must provide ways of empowering all employees, offering concrete incentives for employees to use, and encourage the use, of the intranet. The process-oriented intranet, then, is 'in sync' with the company it works for. And this is where graphic design, tone and standards emerge as vital to the intranet's success. Like it or not, intranets have personalities, which are amalgams of visual style, tone and content. An intranet that reflects the culture of its company will make employees feel more at home, will help dispersed employees feel that they share the same space, and will encourage collaboration and communication around the processes they support."


Initially, a business that wishes to set up an intranet has to consider the following costs: 1) hardware (including the server and network adapter); 2) software and utilities, and 3) installation and maintenance. A simple intranet may be set-up rather quickly if the company involved already has computers that are networked using the common TCP/IP communications protocol. To this network of computers one need only add an extra machine to act as a server. This extra machine will have to have the proper Web server software and network card installed. After everything is up and running, upgrades to the hardware will have to made from time to time to handle increasing traffic. New software like multimedia applications and interactive forums as well as upgrades to existing applications are all essential. The labor of employees who maintain the intranet is an ongoing cost, as are the costs to publish and archive data.

On the other hand, since intranets were designed to save time, they can usually be counted on to save money over time. By cutting down on routine communication, employees can refocus their efforts to better performing their duties. Employees who use the intranet to its fullest potential will discover that the benefits of e-mail, reduced paperwork, and easy access to information will increase their productivity. Both the employee and the employer benefit in this situation. As mentioned previously, company literature that is stored and distributed online rather than through traditional hard paper copies also cuts down printing and distribution costs. Large companies sometimes notice a savings of tens of thousands of dollars when they post their documents online.

In an article that appeared in Intranet Communicator, however, Schneider and McGrath warned managers not to expect too much too soon: "Review the existing return on investment studies or question company executives on their claims of multimillion dollar savings, and one finds that calculating intranet ROI is more art than science and more 'guesstimate' than calculation. Like the sweeping claims made for corporate Web sites a few years ago, many of the projections of ROI measured in thousands of percent may fade as organizations begin to experience the cost of ramping up, maintaining and administering intranets across thousands of users. Not to mention incorporating the inevitable upgrades and conducting enterprise-wide training."


As the cost to maintain an intranet grows over time, so does the time and effort to maintain it. Managers often spend considerable energy trying to keep up with increased traffic and other forms of growth. Proper planning (including having the best Web and network tools available) is one way to cut down on the manpower required to run an intranet. Employees who maintain the intranet must be experts in the area of Web publishing. Managing the server, developing applications, and converting documents and databases to html format are just some of the duties found in this area.

Many companies decide to hire an outside firm to run their intranet rather than do so themselves. This cuts down on the number of internal problems and potential disasters and gives management peace of mind to know that trained professionals are handling this task. If this route is taken, it is important for management to keep some employees dedicated to intranet issues in case the relationship with the outside supplier does not end up working out.

Once the intranet is set up, it is important to keep its content current in order to keep employees using it in the manner for which it was intended. Regular updates regarding company news and the promotion of the intranet from upper management are just two ways to keep it from growing obsolete before its time.

Large corporations like IBM, Ford Motor Company, and the Turner Entertainment Group have all had success implementing intranets into their corporate structure. But these giant companies are not the only ones who have been able to exploit the benefits of intranets to their fullest advantage. Small businesses have taken notice as to how intranets help cut down on costs and increase productivity. Since small businesses often also have less red tape to deal with than larger corporations, a full-fledged intranet or even a test version can often be set up quickly and easily. Once management and employees become familiar with how the intranet works, the possibilities for successful utilization are great.


Denton, Keith D. Empowering Intranets to Implement Strategy, Build Teamwork, and Manage Change Praeger/Greenwood, 30 December 2002.

Hopkins, Bryan, and James Markham. Using Intranets to Improve the Effectiveness of Your People. Gower Publishing Limited, August 2004.

Schneider, Anthony, and Christopher Davis. "Intranet Architecture: Integrating Information Design with Business Planning." The Complete Intranet Resource Available from

McGrath, George, and Anthony Schneider. "Measuring Intranet Return On Investment." Intranet Communicator. June/July 1997.