Has the e-revolution dawned?

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Has the e-revolution dawned?

Small and medium-sized companies must cross over to e-business, says Roger Williams

E-business has a long way to go as a channel to market for most small businesses. A 1998 report from Datamonitor showed that "European small-to-medium enterprises (SMEs)are becoming more aware of the need to adapt to new technology and are spending unprecedented amounts of money on it".

However, a recent report by the Phillips group shows that only 12% of SMEs have developed and implemented an e-business strategy while 40% have not even devised one yet.

So what does the recent glut of dotcom failures illustrate to businesses which think they're missing out on the millions being generated by the dotcom phenomenon?

Well ask yourself this - in the rush to build your Web site and re-branding as an e-business, have you checked your traditional, back-office processes are fully automated and linked to your front office?

Of those organisations which have jumped aboard the e-business express, many have rushed to build front-office solutions to defend their patch against new-economy bandits who have launched concept-based solutions to create market presence and undermine old-economy business.

However, the well-publicised demise of many companies has taken pressure off the industry, with the result that businesses are now applying careful thought (and holding on to advertising purse strings) before plunging into the "e-world".

It's not all over though. A Gartner Group study shows the European Internet economy is growing at a rate of 87%, so don't think that e-commerce is something that you, as an SME, can ignore. It's a matter of perspective. Much needed investment in infrastructure and particularly bandwidth is essential for the future of the e-business.

This will necessitate collaboration from telecommunications firms, governments and larger businesses to create exactly the right infrastructure.

The big financial engines driving major businesses - and not the speculative introduction of investment capital - will become the economically viable and longer-term factor in propelling this transformation. SMEs will benefit as infrastructure improves - and they should focus on being ready for the real revolution - rather than hanging on to the coat tails of some of the current activity.

A core commodity and requirement will be management of business knowledge, which, at the moment, is far too fragmented and piecemeal.

Additionally, streamlining and automating business processes - not business process re-engineering but extended process re-engineering - that links the whole supply chain will be a major differentiating factor. Many SMEs should find they are assisted by businesses - where they form part of the supply chain - to create this end-to-end automation - but should also be wary as the larger firms look for lock-in and, eventually, to pass on costs.

So take comfort, the e-revolution hasn't yet arrived. but don't wait for the date to be set, and a launch invitation to be sent either. The true picture of future operation will emerge slowly.

There are those who will look at the issue and see the problems of Internet-enabled business today, only to discount it as never functional. Such companies would be wise to get more tuned in with technological developments and apply rational thinking to traditional business processes in terms of connectivity. This will ensure, when the time comes to act for their business, they will be ready. By then it won't be e-business, but just business.

Roger Williams is strategy director at IT integrator Origin


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This was first published in November 2000

 

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