E-commerce: evolve or expire

Moving to e-commerce today requires a major commitment by senior management - as well as some sort of understanding of the issues involved. Executives certainly don't require detailed knowledge of the technology that makes e-commerce possible but they do need to know enough to manage the people who do.

E-commerce has captured the imagination of business, government, investors, the media - in short, just about everyone. Which makes unleashing the true potential of e-commerce one of the most daunting challenges facing senior managers today. While an alarming number of executives still seem to ignore the issue, a new prototype for the role of information technology in business is slowly emerging.

We are now in a period where everything is changing, everything is up for grabs and a lot doesn't make sense anymore. How does one obtain a coherent view of the future in an environment like this?

As well as developing new businesses we are also creating new work organisations. With new events also pushing up right against our noses daily, it's easy for businesses to lose a sense of long-term direction, trapping us in a constant reactive mode.

Searching for meaning

Many executives are asking "What does this mean to my business? Why should I pay attention to all this e-business hype?"

It has everything to do with business survival. That's right, survival. This is a fundamental change in business worldwide, and there is a point in the not-too-distant future where it will be impossible to catch up or even to stay in the game!

Today leveraging knowledge, relationships and information around a well-defined business model distinguishes great companies from ordinary ones. The great ones take advantage of their core competencies, and outsource non-core competencies, in order to achieve an agile business model that can respond quickly to e-business opportunities.

The technologies and techniques may vary enormously, but the common thread should be that knowledge is applied in a practical fashion. To succeed, Australian knowledge-based industries must make sure they're up there with the worlds best.

From a technology point of view, banks in Australia are leading users of technology compared with the rest of the world. ATMs, although invented in Japan, were first accepted in society in Australia, EFTPOS was also accepted more quickly here than elsewhere.

IT is a crucial enabling technology that drives services and manufacturing, and we must therefore look to industries that are reliant on IT as potential winners in the future. The services industry offers great opportunities for Australia, especially in areas where we have particular strengths such as mining, agriculture, retail, media, tourism and education.

Boardroom misfits

The importance of IT is not as much in industry itself as the fact that they enable other industries. This is the challenge, but is the thinking in Australia's boardrooms capitalising on that challenge? The trouble, particularly in Australian boardrooms, is that there are few engineers or scientists. The directors are mostly accountants.

It is also necessary for the old industry's skills still to be applied to growth areas, such as financial, technology and transportation.

IT also changes the distribution of power between organisations; the way things get done, the quality of goods and services, and even of the organisation's morale. With careful planning these can be positive changes. This is certainly no time for senior management to be advocating more of the same.

We do need to be taking longer term views, for by doing this we are automatically forcing ourselves to think outside of the box. Things often seem as though they've changed a lot but when you look carefully at what's new you often realise that what's new is the thinnest veneer resting a top of a vast map of what's old and what hasn't changed.

Technology alone though does not drive change, it merely enables change. It creates options and opportunities that we choose -- as individuals and as communities and as entire cultures -- to exploit. It is our response to technologies that drives change.

Internet time

The pace of change is also accelerating. Traditionally we used to introduce technology solutions in years and months, but now the solutions have to be there in 30 or 60 days - on Internet time. This is changing the dynamics and approaches to IT. Systems have to be delivered quickly today.

Given the need to implement significant change and the potential complexity of the alignment process, the CEO as the agent of the board of directors and the person accountable for strategic success is in a unique organisational position to develop, support and ensure implementation of appropriate strategies.

E-commerce strategies that are not well developed and well-executed can easily put a company in a worse position than if it had never attempted doing business online. It is important to identify the organisation's objectives, determine what e-commerce means to the particular situation, and, most important of all, to understand how to measure the success or failure of e-commerce initiative.

E-commerce can be inexpensive, but it's not free. Enterprises can't shortchange the effort. It's also not simply another IT project: representations from all business units must actively participate. E-commerce can bring major benefits or it can be a black hole into which one can pour loads of resources with no hope of return on the investment.

We need to get more executives on board the e-commerce bandwagon and thus ensure that IT is a part of more business plans. It is also essential to alter the way in which IT is viewed within organisations. The key is for IT to be seen as the new engine for growth, and not as a frustrating cost centre that few executives understand.

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