InformationWeek

September 14, 1998

Executive Report: The New E-Business Paradigm

By Clinton Wilder

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s your company ready for electronic business?

E-business means more than launching a Web site-even more than integrating that site with back-end order processing, fulfillment, and accounting applications. That may be enough for successful E-commerce; but E-business, done right, is entirely different. It's more holistic, more sweeping, and more frightening. But the potential rewards are far greater, too.

E-business goes beyond IT. It demands that you examine, and probably change, the way your company performs basic business functions: sales, marketing, customer service, purchasing, operations, overseas initiatives, human resources, finance, and, of course, IT.

chart Look at how some of these functions change when they're empowered by the Web, extranets, or intranets. Take customer service. Offering service and support on your Web site isn't simply a "value add"-it changes the concept of service. Federal Express was an early pioneer of "the customer as data-entry clerk" concept. First of all, FedEx slashed call-center expenses by allowing customers to track their own packages on the Web. FedEx and many others have found the right balance-improving customer service while reducing customer-service costs.

Another example: big chain retailers. They're notbemoaning the fact that Web surfers generally prefer to browse rather than buy. Sears Roebuck, J.C. Penney, the Home Depot, and others are using their Web sites for service, from scheduling home-repair calls to helping locate which store location has an item in stock.

The lesson is simple: When you use electronic links to transform relationships with employees, customers, suppliers, or business partners, the dynamics of those relationships change. If you don't take full advantage of the opportunities presented by E-business, you'll probably spend a lot of money for a small payoff. But beware: If your processes are broken or ineffective to begin with, super-charging them with Web technology will put you even further behind your E-business competitors.

Senior writer Clinton Wilder covers Internet commerce and online services.

"Executive Report: IT Innovators"

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