#525  Innovative Leader Volume 10, Number 3          March 2001

Transforming Your Business to the Internet
by Sandra S. Donovan, Ph.D.

Dr. Donovan, president of Donovan Associates (ssdonovan@aol.com; 609-936-1880), is a consultant and executive coach to senior management on increasing profits and growth through leadership, strategic management, and organizational development.

Most enterprises today have some Internet and Web capability…yet often much of this capability is disconnected, inconsistent and incomplete.  Thus, the enterprise cannot reap the full benefits of increased synergies, innovation, growth, and profits that connectivity platforms make possible.

The Conference Board’s annual Strategic Management Conference in New York in January 2001 focused on strategies and tactics for transforming businesses to more effectively embrace the Internet. Senior executives from many industries and geographies participated. I was the conference program director, and moderated the concluding session of panelists* charged with interpreting and summarizing what we had heard from our speakers and audience.  I’ve sketched the main conclusions from the conference.

(Note: The reader might wish to refer to the summary from last year’s conference: Innovative Leader, Vol. 9, No. 3, March 2000, to appreciate the maturing sentiment on the Internet during the past year.)

Main Conclusions

The recent sobering markets remind us that nothing comes easily. Sustainable value is not created out of mere wishes or hype, but rather through well-formulated, customer-focused strategies, realistic profitability models, and streamlined, cost-effective, value-creating processes using the best available technologies, practices, and people. The panelists emphasized the need for enterprises to retain the basics of good business management.

Fear of the dot.com companies is being replaced with the recognition that the fiercest competitors will be traditional organizations that are transforming to embrace the Internet.  And the leaders have a “ruthless execution” mantra.

Our panel unanimously felt that a traditional organization would not remain competitive if it simply had basic Internet connectivity and did not integrate its functions into the Internet.

Transforming a business is more challenging than simply buying some technology and adding an e-appendage.  Transforming requires leadership, ability to change, and ability to learn new ways to do old things. Below are insightful comments from the panelists.

Reasons for allocating company resources to make a company’s functions Internet-ready:

  Core business is at risk if functions are not e-enabled.
  There is a blurred line between “The business” and “e-business”.  Put differently, e-business is the business.
  A company must compete in three areas: (1) the product market, (2) the talent market, and (3) the capital market.  A non-e-enabled enterprise will not be able to compete effectively.
  Customers will force this…it’s not an option.
  Talk to your customers. They will tell you what you need.

The most difficult challenges organizations face in transforming to embrace the Internet and the Web:

  Rethinking the business design so that it is consistent with the best ways to take advantage of the Internet.
  Getting the organization to change decision-making and delegation processes.
  Changing the culture…recall that people think in human time, not Internet time.
  The human element and the correct leadership.
  Building a learning organization.
  Fragmentation and keeping up to date.

Possible trade-offs for an organization embracing the Internet:

  The human impact.  There is trade-off on control…less control than previously.
  Manager must change traditional styles to cyberspace styles.
  People need to learn to work differently.  For example, work is now 24x7x365.
  Limits and processes are different.
  Less security?  Less touchy-feely?
  Individuals must give up their false sense of thinking they know all about the

Items to address first when developing a business strategy:

  Business design.
  Business imperatives.
  Understand what you’re trying to do…who are the customers?
  Understand what the customer wants.
  Understand the cost side.
  Find out everything the corporation is already doing. Organize it and align, concurrent with the aligning the infrastructure.

Money-making opportunities in this connected Internet economy:

  Cost reduction and new opportunities
  Huge gains in efficiency
  Customer retention
  Streamlining content

The single most important change in business conditions on the Web during the past year:

  Drop in market valuations, and recognition of need to get back to fundamentals.
  Emergence of Net markets, removing time and cost.
  Supply/demand of investment money.
  Better fulfillment from Internet orders.
  Last year the large companies were driven by fear of what the Net companies might do.  Now the big companies have embraced the promise of the Internet and are transforming as quickly as they can, such that their fear is now directed at what the slumbering giants could do competitively once they complete their transformation.    

The key concerns a year from now will be:

  Advances of traditional competitors as they transform to embrace the Internet.
  Competition from non-domestic sources.
  International competition.
  Supply chain management.
  Tightening purse strings.
                                                                        © 2001 Sandra S. Donovan

*      Panelists: Cathy Benko, Global e-Business Practice Leader, Deloitte Consulting; Janice Castro, Assistant Professor Medill Graduate School of Journalism, Northwest University; Ryan Craig, Vice President New Business Development, Fathom; Robin Ferracone, Chairman, SCA Consulting; Dave Mason, Senior Vice President of Strategy, NerveWire; Neil Pitts, Director of eBusiness Marketplaces Worldwide Information Systems, Eastman Kodak; John Sifonis, Director, Internet Business Solutions Group, Cisco Systems.

1-50  51-100  101-150  151-200  201-250  251-300
301-350  351-400  401-450  451-500 501-550  551-600

©2006 Winston J. Brill & Associates. All rights reserved.