x

Future State: The E-Business Environment

Features:

• Connectivity between highly diverse companies (and their systems) at a very low cost and on an unprecedented scale

-Provides the opportunity to coordinate heretofore disparate activities with increasing ease
• Prominence of asynchronous communications (those not requiring real-time communications among two or more people; for example, websites and email)

-Enable communications to take place at a time that is of the lowest cost to each participant
• Hyperavailability of information to anyone who has access to the "web" of activity

-Enables a large number of people to make decisions based on the same information (for example, the end consumer's demand signal)
• Connectivity and asynchronicity combine to drive down the cost of interaction and transactions, among customers as well as members of the enterprise and its partners

Conclusions

• Adoption of many customer segments will undoubtedly follow the tornado model

-"The jury" will return a positive verdict after which hordes of customers will interact and transact on-line
• "Opening up" the enterprise to an unprecedented level of scrutiny will be a difficult reality for some business leaders to accept

-The true value delivered by the enterprise's products and services will be discussed openly everywhere
• This will be inevitable, and enterprises that resist it will be seriously disadvantaged

Future State: The E-Business Customer

• Enterprises are becoming increasingly transparent to their customers

-Customers have the unprecedented ability to learn in-depth information about the enterprise's products, processes, problems and competitors
• Customers of all types have a far lower cost and increased scope of interaction

-Increasingly able to share their experiences with almost infinitely many other customers
-This is a key element of the power shift to the customer, away from the enterprise
• Customers will demand increasing satisfaction from enterprises, once they know that they can deliver it with e-business processes

-The market will not forgive companies that ignore this phenomenon
• Customers will demand that enterprises think of their needs first and allow them to design products and services to fit their needs

-This contrasts sharply with the enterprise-focused model of today in which enterprises to design products and sell them to a mass market
• Customers will take the lead in dictating what kinds of products and services they use, and they will reward enterprises that enable them to do this most easily

Conclusions

• The rise of the power of the customer will upset many traditional enterprises that are accustomed to pushing product to customers
• Due to their pain, many companies will turn inward, forgetting that customers are going through significant changes

-Companies that have the foresight to help customers make the transition will gain huge benefits
• The enterprise that creates the capacity (knowledge) to engage customers to help it to satisfy them will be far better off in the satisfaction game

Future State: The Extended Enterprise Is a Knowledge Enterprise

• The extended enterprise is one with valid core competencies operating within a web of complementary companies that is coordinated to present one face to customers
• Hyperavailability of information, low interaction cost and the need to satisfy customers drive the ascendancy of knowledge

-Knowledge is defined as information applied to performing an action
• The cornerstone of creating value in the e-business environment will be creating, organizing and leveraging knowledge

-Focus on how the enterprise satisfies customers and knowledge about how the enterprise interacts within its web to deliver unique value to its customers and its partners

• The leading extended enterprises will drive strategic planning into their organizations

-The focus on core competencies will drive the creation of opportunities that create and deliver value
-Opportunities will be more short-lived and more numerous than they are today
• The leading enterprises will be those that have confidence in their ability to create and deliver unique value propositions

-Confidence will be necessary to take the risk of adopting the new model and sharing knowledge with their customers and partners at a level unheard of today
• Confidence will stem from building a cadre of knowledge workers

-This will have to be pursued organically, via an individual and organizational learning process
-Workers that are conscious of knowledge and how to apply it to customers in the new e-business environment do not exist yet
   >They have to learn on the job

Conclusions

• Knowledge is an accelerator because it increases the enterprise's ability to learn and create more knowledge
• There will be no extended enterprise that is not first a knowledge enterprise
• Enterprises that fail to act and ignore the knowledge component of e-business put themselves at significant risk