(reprinted with permission from Your Virtual Insurance Dec 17, 2001, SellingWithTechnology.com)
Businesses are continually buffeted by an onslaught of
buzzwords, acronyms, and slogans supposedly encapsulating the new rules of the equally
supposed new economy: B2C, e-procurement, B2B, E2E, ERM, Trading Exchange, PTX, eCRM,
speed-is-everything, XML, P2P, et al. Each new acronym and slogan is often contrived by
analysts and technology vendors. The onslaught of these words creates much hype for their
creators but also fear, uncertainty, and doubt; not to mention false starts and wasted
investments for the companies trying to implement their concepts. But today, management
must pierce the subterfuge of the gee-whiz words and view the Internet from the first
principles; the established fundamentals of business.
Today, businesses conduct themselves as they always have. They buy, make, and sell things
and services. They did this before the Internet, they do it now, and they will continue to do it.
Such back-to-earth management thinking, however, doesn’t
diminish the importance or the urgency of using the Internet. The Net can be used to
reinforce one of the first principles of business: trusted relationships. Successful
relationships are born; they evolve and grow; and they die. They don’t happen overnight.
The central variable that determines the health and growth of relationships is trust. But
trust isn’t something that just happens. Trust must continually be re-earned in good times
and bad. Building trusted relationships is key to understanding the real business
transformation being ushered in by the Internet. Relationships are the strands, and trust
binds them together to weave the digital tapestry of business.
When you look into the Internet mirror on the wall, you see
that the Net is a digital mirror image of your existing relationships with your suppliers,
trading partners, and customers. The new breeds of independent e-marketplaces failed
because they don’t reflect the existing relationships between buyers and sellers who have
traded with one another for years. For example, automakers aren’t going to go to a dot-com
e-market to find and to procure tires from strangers. They already know their trusted
suppliers and will continue to deal directly with them.
Then, what is so urgent in this digital- mirror world
reflected by the Internet? It is the ability to amplify existing relationships. This is
especially true during a struggling economy. When it comes to incorporating the Internet
into your business strategy, you have to ask yourself but one overarching question:
“What is it that we can now do, using the Internet, that enables us to amplify
existing relationships that we could not do before?”
How can we remove friction (time and expense) from our
business interactions? How can we aggregate more buying power? How can we aggregate
existing and new suppliers to provide our customers with total, one-stop solutions? How
can we share business intelligence and design tools with our trading partners to reduce
cycle times and inventories? How can we empower our sales force to close deals more
quickly? How can we establish extended “value chains of information” with our
suppliers’ suppliers, partners’ partners, and customers’ customers to bring about 10 times
hyperefficiency and hypereffectiveness for all? How can we provide the management of the
companies across our value chains with the real-time information they need to respond to
changing market conditions?
Mirror, mirror on the wall, how do we build the best
relationships of all? It will take breakthrough technologies-such as Web services and P2P
architectures-to overcome the chronic problem of dynamic business-to-business integration
and extend existing systems and processes to the small and medium enterprise participants
in your value chains. It will, furthermore, take courage, leadership, and a balanced
program of risk management to adopt these emerging technologies.