At its core, e-business is a simple proposition. Businesses interact with customers through various channels such as retail stores, phone, print, television, instant messaging and ATMs. Leveraging interactive channels like the Web can drive down costs, expand markets and create new revenue opportunities. For businesses that have mastered the interactive channel, there is plenty of good news.
The Web is faster and more economical than traditional business channels, and offers new ways to interact with customers. The Web also is the most measurable medium ever, enabling savvy businesses to improve products, build customer relationships and identify new revenue opportunities. By the numbers, the e-business future looks especially promising:
X According to research firm eMarketer, business-to-consumer (B2C) spending, a rare bright spot in the current economic doldrums, is expected to top $126 billion by 2004.
X A B2C record of sorts was set during the 2002 holiday season when shoppers spent more than $2 billion online in a single week.
X B2C numbers are encouraging, but represent only a small fraction of business-to-business (B2B) e-commerce. eMarketer estimates that B2B spending will reach $2.4 trillion by 2004.
X The growth of e-business is also expected to drive spending on interactive advertising to $63 billion by 2005, according to Forrester research.
These numbers may seem surprising to those who counted e-business out after the well-publicized dotcom flameout and continuing tech-sector blues. But perhaps the most surprising aspect is not how far e- business has come, but how far it may go. Neither B2C nor B2B transactions have reached even five percent of total transactions in their respective markets.
Obviously theres ample opportunity for organizations who want to expand their businesses from traditional to interactive channels such as the Web. In fact, many customers now expect to have the option of choosing to transact business via the Web or switch between channels as they please. But while the goals of e-commerce are simple, achieving them is not. Theres no magic formula to ensure that businesses can profitably leverage the Web to support and enhance other customers channels.
Technology-driven changes
The Web has fundamentally changed the way business works. In less than 10 years, leading organizations have reinvented the way they communicate, collaborate, buy, sell and create processes to take advantage of powerful and affordable Web technology. Technology also has spread from the back office to every business unit throughout the organization. Companies with more advanced technology strategies have leveraged Web-based tools such as portals and intranets to interact more effectively with customers, vendors and business partners.
And though advances in Internet, PC and network technologies have created unprecedented opportunities to control costs and improve business process, many companies are struggling to find ways to apply technology to business challenges. Though technology clearly will continue to be a key business driver and competitive advantage, many organizations have no strategic plan for its implementation. Surprisingly, many businesses continue to apply technology on a piecemeal basis, implementing various solutions around the organization as needed. Without a comprehensive technology strategy, many businesses are unsure whether they are spending technology dollars wisely.
The most successful businesses of the digital age are those that understand the confluence of business and technologyKhow to apply emerging technology to business processes to get things done faster, with less expense and with fewer mistakes. Considering its importance, there seem to be few guidelines or best practices information available on the strategic application of technology to business challenges. While many organizations already transact businesses on the Web, many have failed to turn a profit and worse, some have damaged customer relationships by providing unreliable or poor-quality service.
Although each business is unique, all businesses can benefit from a adopting a structured approach that taps into the body of knowledge weve accumulated from the e-business successes and failures to date. At BusinessTechKnowledge, the methodology we use to increase the effectiveness of e-business initiatives is called IDEAS. This paper presents a high-level outline of the IDEAS process that can be used as a checklist for emerging and expanding e-businesses. IDEAS for e-business success
E-business success requires more than setting up a shopping cart and accepting online payments. Todays leading e-businesses generally have succeeded by adapting products to the Web channel and strategically integrating the Web with other customer channels. Using a methodology that integrates the design, development and marketing components of e-business can help control costs and improve your chances of success on the Web. The IDEAS e-business method includes five phases:
IDENTIFY – and document the critical components your business needs to create an interactive presence the Web. DESIGN – a solution by matching business requirements to appropriate technology solutions EVALUATE – objectively review project plans and make any changes you need to succeed ACT – building, testing, and refining your Web site and business processes SERVICE V Providing great care for your customers is much more cost- effective than finding new ones
We use the term phase to mean an aspect or part of a process, rather than a distinct segment. In practice, some of the phases will overlap and the cycle of phases will continue as long as youre in e- business.
For example, the Evaluation stage may lead you to decide on an Action to Identify profitable market segments. You would then Design a plan to tap these segments, Identify how this plan is to be Evaluated, and so on. A huge advantage of Web-based channels is that they can instantly be changed or refined in response to new opportunities, market trends, competitive factors and more. Although every part of the IDEAS methodology may not apply to your business, you may benefit from applying some parts or creating a similar structured methodology.
Up next – the five phases revealed! Please visit businesstechknowledge.com to read the entire IDEAS White paper. Your feedback and ideas are welcome.
Charles Warnock is Marketing Director at BusinessTechKnowledge Inc.
He is the author of “IT for Business Leaders” and writes frequently
on marketing and technical communications, e-business and corporate
training. To learn more, visit http://www.businesstechknowledge.com
or e-mail Charles at cw@businesstechknowledge.com.
