Web technology can be seductive. It is all too easy to install a 
Web server, generate some flashy graphics and, bingo, you have an 
electronic version of your core business operations. Unfortunately, 
successfully transitioning your company to e-business a lot more 
complicated than that. E-business is not just about developing a 
Web site but rather changing your business model to adapt to the 
new economy. Simply grafting a snazzy front-end on your current 
business is unlikely to take full advantage of the opportunities 
offered by the e-business revolution and may in fact be a 
prescription for disaster.

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The problem with this approach is that it doesn't address the 
important issue of whether your current business model can be 
improved to take advantage of new e-business opportunities. For 
example, suppose you have regional distribution centers across 
the country. Without a doubt, the Internet can speed communications 
between these distribution centers. But that overlooks the 
possibility that the Web may make it possible to serve the country 
from far fewer distribution centers or even that you need don't 
need regional centers at all any more. The nonstrategic approach 
to e-business also leaves a free path for a new market entrant to
develop a more efficient channel structure that blows you out of 
the water.

What you should be doing instead is to first develop a macro level 
business strategy that provides a road map for adapting your business
to the era of e-business. Just like developing a business strategy 
for the old economy, your e-business strategy should start by 
considering your current position in the market including strengths 
and weaknesses, products and distribution channels, the challenge 
posed by competition, new opportunities in the market, etc. But at 
the same time you need to consider the opportunities and challenges 
posed by the Internet, such as the potential to interact directly 
with customers to streamline distribution channels as well as the 
competitive threat posed by new market entrants leveraging the 
Internet. Clove (Herb Pharm)

The next step is mapping a path to implement that strategy while 
putting the primary emphasis on delivering a positive experience to 
your customers, channel partners and the others with whom you 
interact. Trying to avoid going down the blind alley of making 
incremental improvements to your existing business. For example, 
business units, with each targeting specific products and markets, 
may organize your company. In that case, the individual business 
units are doubtless thinking about how they can optimize their own 
piece of the pie rather than the effect of the e-business revolution 
on the entire company. Chances are, many of these units may be 
performing the same business processes in slightly different ways. 
In that case, there are probably serious opportunities of scale 
across those business units, such as using the same technology to 
perform processes such as sales order processing, inventory or 
customer service. Taking advantage of these opportunities will 
require a big-picture perspective that requires the involvement of 
top management to serve as an integrating force.

It's important that your e-business strategy the focus not on the 
needs of fiefdoms within your own company but rather on the experience
of the user of your system, whether it's a customer, general partner 
or employee that is interacting with you. One of the most important 
areas is segmenting your strategy to address the individual needs of 
different users. For example, a human resources Intranet should be 
subdivided so that employees are able to quickly get information on 
their benefits and compensation while human resources professionals 
are able to obtain the much more complex information that they need 
to do their jobs.

Personalization is often the key to providing an outstanding experience
to the users of your Web site. As an example, one of our customers 
developed a first-generation web site that delivered a large volume 
of basic technical support information on their Web site but failed 
to impact the rapidly growing need for personal support services. The 
solution was developing a more personalized approach that provides 
important advantages over traditional technical support. Now, when a 
customer hits their support site, it now knows who they are, the 
products they own, how long they have owned them, what release they 
are on, what level of support services they have contracted for, etc.
The support site then provides them with a customized interface that 
addresses their individual needs. For example, it provides the status 
of outstanding service requests and technical bulletins on equipment 
they own.

It almost goes without saying that it's very risky to rely upon your 
own perception of your customers' needs. A far more effective approach
is to let actual customers evaluate your existing site as well as the 
approach you are considering on a prototype basis so they can express 
their opinion as to whether it meets their needs. Focus groups and 
usability studies provide an excellent method to determine without a 
major investment whether or not your site is easy to navigate, 
delivers the correct brand impressions, contains the features and 
content that your customers are looking for, etc.

Another point to consider is that no matter how good a job you do in 
developing your strategy, it's going to be outdated in six months. 
That's why it's so important to develop a flexible, scalable 
architecture that will allow your system to easily adapt to the future.
Within a year after your site goes online, there's no doubt the 
competitive landscape will have changed. You may have purchased a 
company, been acquired, entered new markets, changed your distribution
channels, etc. The use of open standards and industry standard tools 
can contribute to the development of architecture with real staying 
power. Be sure to investigate the financial strength and market 
position of the companies that you choose to provide components. 
Their ability to support you over the long term is just as important 
as the value of their technology.

Finally, one critical part of your e-business strategy is the use of 
technology in your company. Are you going to build up your own 
expertise to maintain your e-business? In that case, you need to 
develop a programming staff, graphical design studio, editorial staff
for content development, etc. The other alternative is to outsource 
your technology development to a service provider that will maintain
your infrastructure and deliver your applications as a hosted service.
This approach has the advantage of allowing you to focus on your core 
business operations and outsource the technology issues to a 
specialist. Whichever approach you take, develop a strategy that 
takes advantage of the changes wrought by the e-business revolution 
and your chances of success will be high.

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By Bob MacAvoy
Vice President, Client Services
Logical Design Solutions
mailto:jkriegman@LDS.com 
New York, New York