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April 10, 2000

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Roundtable:
The Competence Base

The Internet is giving customers power they never had before--and they're driving business innovation

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To explore the implications of a consumer-centric economy, InformationWeek editors recently conducted a roundtable discussion with Pehong Chen, president and CEO of BroadVision Inc.; Tim Guleri, CEO of Octane Software Inc.; M.S. Krishnan, assistant professor of computer and information systems at the University of Michigan Business School; Denis O'Leary, executive VP of Chase.com; C.K. Prahalad, professor of business administration at the University of Michigan Business School; Venkatram Ramaswamy, associate professor of marketing at the University of Michigan Business School; and Peter Solvik, CIO and senior VP of information systems at Cisco Systems.

C.K. Prahalad: I was recently told a fascinating story, even if it's only anecdotal. Somebody went overseas to Asia and got very sick, got treated, and came back. Nobody here could figure out what the problem was. She got on the Internet and within two days, she got not only a diagnosis but all the attached links to medical journals. The doctor didn't have that information--it was a community of consumers from around the world who were trying to help her out. You hear this story over and over again. Individual consumers, by bringing their skills into the game, can provide knowledge and new ideas to their peers and to large companies. So it's the evolving communities of consumers who become a source of competence--as much as suppliers and large companies can. Individuals bring skills and knowledge, and it's the community that provides the competence base.

InformationWeek: Is there a difference between customer and consumer, the use of the term?

Denis O'Leary: I'm not concerned whether you call them consumers or customers, until we get into a specific opportunity for value. I'd agree, though, that we're talking about a pretty holistic system. We touch everybody, directly or indirectly. So you wouldn't want to ignore anyone in your model.

Prahalad: Denis' company [Chase] has to deal with large companies, smaller companies, private banking, individual consumers--there's a whole range of things that you have to deal with.

O'Leary: Companies are becoming networks, and the basic goal is to be ubiquitous and device-independent and to be accessible to any form of customer. Then we modify the content that's available, depending on who's attaching and how. If it's a company attaching to us with a mainframe that wants a file download, we authorize the data available to that client and give a pipe that's appropriate to that kind of downloading. It might be a consumer attaching with a PDA, and then we modify again what content they're authorized to see or what transactions they're authorized to do. Based on the nature of the device, we modify how we attach.
Everything is an IP address. Everything is essentially one network. And the resources of the company should be available to any client, if it's appropriate.

Venkatram Ramaswamy: With this proliferation of devices, the wide variation in skills among the people who use these devices and interfaces, all these touch points, starts to become a very critical issue.

Prahalad: Increasingly, we're going to get very high levels of expectations and no capacity to understand why things don't work sometimes. The top of the pyramid in terms of skill base are the easier customers to deal with on the Internet; those at the bottom of the pyramid are the difficult ones, because expectations are high. The sophisticated customers understand the technology and are much more fault-tolerant. The people who have no understanding of the technology but have high expectations aren't fault-tolerant.

O'Leary: I'd like to meet the fault-tolerant guys.

Tim Guleri: My company makes customer-management software for this new economy. We've taken a device-independent, customer process-centric view to the whole problem. The process can be invoked by any device--one that you know of today like a call-center agent, an ATM, an E-mail, a self-service session on the Web site--and devices that might be introduced going forward accessing the same process through, for example, Wireless Access Protocol. The tiering of information that's accessible to a customer or a partner is led through self-service, which is the first layer; the second layer is collaborative service, in which case they can invoke a more personalized, one-to-one session with the company. And finally, the "human-assisted" service, in which case they can be talking to or interacting with a real person in the call center.

O'Leary: That real person in the call center is just standing in between the data sources and the customer. The only thing he or she may have is privileges for more scripting or prompts than the customer might see.

Guleri: That's correct. The goal is to capture the customer's experience and enhance it in case they're getting tripped up accessing some of the traditional information that might be siloed inside the organization.

Prahalad: I'd add one more thing. We see things becoming not only device-independent, which is already the case, but media-independent--whether you have video, audio, or just can be dependent on the device being used and on the requirements of the job. I can very easily see self-help demonstrations for customers using video or audio.