Essentially, this book is about trying to understand the implications for business and commerce of the Internet and the World Wide Web. More specifically, it is about imaginative, people to people communication strategies that are likely to change all the rule books for competing in highly competitive markets.
Everywhere, the pundits are telling us that this seemingly innocuous new medium of the Internet holds the possibility of not only changing the way people do business but also of having a major impact on the way people live their lives. The agrarian revolution changed society from hunters and gathers to farmers. The industrial revolution caused populations to mass into towns and cities. Now, all the people who should know these things are telling us that we are at the dawn of another revolution that is going to dramatically change society once again.
They are probably right and we are now in a transition period between the Industrial Age and the Information Age. If so, it is important that we take a serious look at this proposition and try to understand what it is really about.
Where the advances in computer technology and digital communications will eventually take us is not predictable, so we'd be wasting our time on that. More realisable and profitable will be for us to be concerned with the nature of the change itself. It is at the crest of such a wave of change that fortunes can be made. It is here also that new careers can be forged; new businesses created; fresh and imaginative techniques and strategies formulated. We ought to be there with our eyes wide open.
To be on this wave will open up many opportunities but there will also be numerous pitfalls. Pioneering in any new territory is not for the faint-hearted; it is not for nothing that the frontiers of the digital communications revolution are known as "The Bleeding Edge". False steps can lead to disaster and oblivion, but, unless risky steps are taken there is no alternative other than to play "catch up" - not the best game to play in a fast moving environment where early successes and innovations are so richly rewarded.
Those able to understand what is going on and who can respond with appropriate strategies will have the best chances to thrive and prosper. The rest are likely to find themselves falling rapidly behind. It is the purpose of this book to to try to find the right mind set, the understanding and the conceptual tools necessary to be able to ride this current wave of change successfully.
Now it is easy to make all these rhetorical statements about a changing business environment, a changing world and to take advantage of the changes, but we have to look beyond the empty rhetoric. It's no good just saying there are changes ahead and we can benefit from these changes. We need to specifically know what the changes are and we need to know what we actually have to do to benefit from them.
First, let's be clear what is meant by the terms e-commerce and e-business. They will be used interchangeably and together in this book because at the time of writing there is no common agreement as to what they mean or the fields they cover. The lower case "e" represents "electronic". The term "commerce" is generally applied to the processes involved in buying and selling. The term business covers a much wider area and is applied to any and all communications and processes concerned with the selling, buying, supplying and manufacture of products or services.
Whichever of these terms is used in this book, it will relate to processes which involve the use of the Internet. This is the aspect that will be our main concern: the direct or indirect effects of the Internet and its accompanying technologies of computers and digital communications. The reader is advised not to be too fastidious over the meanings and definitions of words used in this book. In a world so prone to change, words have limited permanence, their meanings can become distorted and give rise to ambiguities and misunderstandings if taken too literally. Where there is cause for ambiguity, words will be defined, but, be warned, these definitions may not accord with their everyday meanings.
In the writing of this book, it has become apparent that the subject matter will involve a clash of cultures. The main cultures concerned will be those of the corporate culture, the academic culture, the scientific culture, the artistic culture and the entrepreneurial culture. Each of these cultures will have their own specific ways of approaching, using and understanding the Internet. However, there is one consideration that overrides all issues of culture: the rapid advance of computers and communication technology is throwing up so many changes that the thinking of yesterday is unlikely to be relevant today. This means that anyone who seriously wants to understand what the Information Age is about must totally disassociate their thinking from any techniques or procedures they might have learned in the business environments of the Industrial Age.
Too often, people will want any new information they receive to fit neatly into a knowledge structure they have already formed for themselves in their own mind. This isn't always possible. A mismatch creates a situation where people talk past each other. They think they are talking about the same thing but in reality they are each talking about quite different models of reality, where words and even concepts can have totally different meanings.
Normally, this isn't too much of a problem because people from different cultures work and converse mainly in their own domain, but, when all the cultures converge to discuss a subject of mutual interest- such as the new environment created by the Internet and the World Wide Web - there can be much misunderstanding and discord. The reader should be constantly on the alert to ensure that his or her own cultural background doesn't get in the way of learning about and understanding the many new concepts that will be involved in adapting to the Internet.
The Information Age is new and different from the Industrial Age. Everyone must be able to step outside of their own personal model of the world to see the Information Age for what it really is: an "Alice in Wonderland" world where all the conventional rules of communicating, cooperating and doing business are radically different. We are now in a new Millennium and must leave the ways of the previous Millennium behind us.
Mainly this book will be concerned with strategies. One of the most confusing of the issues that arise between corporate and entrepreneurial cultures is the concept of a plan or a strategy. In the corporate world, the plan is the fundamental basis of all business and commercial activity. In many instances, such plans are referred to as strategies and the two words are used interchangeably. Similarly in the entrepreneurial world, an entrepreneur will have a plan or strategy, but, an entrepreneurial plan or strategy is often conceptually quite different from that of a corporate plan.
Corporate plans are about applying generally acceptable rules. They are based upon knowns, knowables and statistical predictables. These are used to structure an approach to reach a goal. In contrast, entrepreneurial strategies quite often dispense with any formal or organised plan and rely on rule of thumb: a set of ad hoc rules that allow entrepreneurs to react flexibly to unpredictable situations. Such strategies are sometimes so loose and flexible that very often an entrepreneur will consider that he or she has no plan at all when setting out on a business venture - only a strategy.
Such differences in the way corporations and entrepreneurs view plans and strategies can cause much misunderstanding. For this reason this book will take the view that corporations make plans and entrepreneurs have strategies. Corporate plans, for the purpose of this book, are defined as plans that are based upon logical reasoning, past experience, training, precedence, justifiable risk and statistically based assumptions.
In contrast, the strategies of entrepreneurs will be considered to be less structured, more loose: rule of thumb strategies that might include inductive inferences, calculated risk, hypothesis and assumptions that cannot be logically justified.
With these definitions, there will undoubtedly be some corporations using entrepreneurial type strategies and some entrepreneurs using corporate type planning, nevertheless. it will be more useful for comparison purposes if we treat corporations and entrepreneurs as different animals who play by different rules. Seeing them in terms of black and white will save having to keep explaining the exceptions.
There is a similar conceptual mismatch of approaches to achieving goals with academics, scientists and artists. Academics will generally work from precedence and officially recognised sources of knowledge. They will build from the knowledge of others and deduce their conclusions using a top down approach. Scientists and artists on the other hand are always looking into the unknown, they will assume that their goals are outside of current knowledge and will work inductively, looking for original breakthroughs that go beyond the limits of what is known already . Their approach will be bottom up, building creatively towards solutions. Again this is a black and white description, as many scientists and artists will work in the way described here for academics and many academics will work more in the way described for scientists and artists. Also, many more will combine a mixture of the two.
A somewhat similar conceptual confusion arises over the issues of what constitutes self regulating systems and evolutionary design. For most corporates, the idea of a system that controls itself suggests anarchy and disorganised chaos. Products that design themselves, if they can be visualized at all, bring up visions of inefficiency and gross malformation. This contrasts sharply with the attitude of an entrepreneur, who might see self regulation as a means of efficiency and cost saving. A self regulating system can thus have different meanings to different people.
Entrepreneurs often rely on subjective human qualities such as trust, reliability, loyalty and duty, in place of standards and control to effect regulation in their organizations. This might seem unsafe, even bizarre, to most corporate planners who will want to see more tangible elements holding their organizational frameworks together. The corporate planner would see human qualities as being subjective, with very fuzzy meanings and values: far too imprecise to specify in a corporate plan.
Entrepreneurs, on the other hand, have to be more pragmatic. These human qualities are the glue that holds their organisations together. For their purposes, the entrepreneurs will need to assign measurable, qualitative substance to these human attributes - a task most corporate minds might find difficult to come to terms with.
Corporates quite often misunderstand the motives of an entrepreneur. An entrepreneur will often not have the resources for careful planning, long developments or exhaustive testing that are usually available to a corporation. This leaves an entrepreneur with no alternative other than to put an unfinished, incomplete and untested product onto the market; making changes on the fly, according to customer complaints or additional demands. In the eyes of the traditional world of corporate business practice, such entrepreneurial strategies might be considered sharp practice and ethically unacceptable, but, as we shall see, this seemingly unacceptable strategy of the entrepreneur is going to have to be adopted by responsible corporations if they are to succeed in the Information Age.
Already this strategy is being widely adopted. Products, in virtually prototype stages, are being distributed for free. The customers then try them out, test them, reveal the faults and deficiencies and ask for new features. In this sense, products can be seen as designing themselves: expressing their design instructions by eliciting responses from the customer. This is the technique of evolutionary design. This is the way of the Internet.
Copyright 1999 - Peter Small
All rights reserved by Pearson Education Ltd (Longman, Addison-Wesley,Prentice Hall, Financial Times)