in International Business
The information revolution is fundamentally changing the way we do business, communicate with our clients, market our products, source suppliers and find buyers. In addition, new "virtual industries" (industries that exist electronically but do not have any physical premises, etc.) such as virtual shopping malls and virtual banks, have sprung up in the past few years that were not even dreamt of previously. A July 1997 Forrester report indicates that Internet commerce has accelerated dramatically in recent months and predicts an increase from the current level of approximately US$8 billion to over US$300 billion by 2002.
Companies world-wide are rushing to the Internet to take advantage of its low cost, wide market coverage and interactive nature. The US research group, IDC, estimates that 80% of Fortune 500 companies have Internet Web sites. (A Web site generally consists of several pages of information, graphics and pictures, presented in a specific electronic format, that can be read by anyone anywhere in the world, who has access to the Internet.)
IDC also found that companies doing business on the Internet made significant savings of between 50% and 90% over traditional methods such as telephone. The return on investment for Internet advertising can be enormous. Dell computers are already selling over US$2 million per day, less than one year ago, after the site was launched!
These are but a few of the dramatic savings and profits that are being made by companies that have adopted the new tools of the information age to their business practice. Similar gains in productivity and efficiency are also possible through the proper application of intranet and related information technologies. The intranet is effectively an internal Internet operating within a company. It uses the same technology as the Internet, but is not necessarily connected to the outside world, and is intended primarily for use by staff members within the company.
Practically any company of any size in any country can benefit from using the new information tools currently available, to increase sales, reduce costs and improve communications with clients. Applications can range from the use of simple e-mail to provide better contact with clients (and also reduce the cost of communication), to the development of elaborate Web sites, to market a company internationally at very low cost. Even basic Web sites of 3 or 4 pages have proven very effective, if properly designed and marketed.
Information - a strategic resource in Business
Information has, in fact, emerged as a key strategic resource in national and international business development and the proper management of this resource can have an enormous impact on the growth and development of a business. Indeed, in many cases, it is a prerequisite for survival.
While it is becoming abundantly clear that a fundamental shift in business dynamics is taking place, literally before our eyes, many businesses in developing countries are failing to exploit the potential of this strategic asset and, as a consequence, are placing their longer- term growth and viability in jeopardy. There may be many reasons for this, such as: poor telecommunications; the high cost of computer equipment; lack of available skills; lack of understanding of the dynamics of the information age; and lack of role models, among other factors.
Real as these obstacles may be, it is clear that whether your company is in Senegal or Sweden, Jamaica or Japan, the fundamental issue is the same - you must develop a strategic plan to manage and exploit the new information tools. Remember, information tools are relatively inexpensive and easy to use, and are likely to provide a significant benefit to your company, both in terms of improved efficiency and service, reduced cost and increased sales.
The Impact of IT on Business - CCIC
Four main concepts best summarise the potential impact of Information Technology (IT) on modern business. These are: Communications, Change, Imagination and Courage.
* Communications: The information age is all about communicating - providing product information, placing and tracking orders, handling enquiries, providing follow-service and obtaining customer feedback.
* Change: Information technology is rapidly changing the way we use information in our companies, organisations and, indeed, the whole way we do business. The Internet, intranet and related technologies offers almost endless opportunities to look anew at our business processes to see how we can use information to make the company more efficient and competitive. Information is now a crucial strategic tool for business development.
* Imagination: It is very important that we approach the adaption of these new tools with an open and imaginative mind. To simply apply the new technology as an additional tool within our business would, in fact, be missing the enormous potential for change that this new technology offers. There are new opportunities and new ways of doing business that IT and electronic commerce offers. We are, in fact, on the threshold of what has been called "the wired economy," where companies are linked electronically to each other throughout the world, engaging in paperless electronic commerce.
* Courage: Embracing this new technology will require companies, individuals and legislators to make courageous decisions in order to forge a new path in this emerging information society. The decision-making process will have to be flexible enough to handle the rapidly changing nature of the technology. Governments will have to develop a clear and imaginative policy for IT development. For example, computers could become tax exempt and low interest loans made available to individuals to purchase computers. The IT sector should be given a high priority in the economic development of countries. Regulations that inhibit the growth of IT should be reviewed (bureaucracy and regulation are already impeding the development of the IT revolution in Europe.) Training institutions should focus on IT application and business development.
Act Now!
It is important to demystify the technology and to start looking at the new information management tools from a business perspective, rather than a technological one. Companies should become familiar with these new tools and determine how they might be best used in their own particular environment.
It is recommended that companies re-evaluate the information resources within their company and in the external environment, and develop a coherent strategic plan to out these resources to work for the business. Outside assistance should be used, where necessary, and relevant staff members should attend Internet or related business information seminars or workshops.
And finally, do it - do it now! Any company that intelligently applies the new information tools to its business will end up with a more efficient company which has a better overall handle on its overall progress and direction.
They will be more competitive in their local market and will be better able to either engage in exports, or fend off imports. And who knows, some companies may even develop as an yet undreamed of virtual product for this new information age.
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