Despite the hype and their own growing investments in technology, only four percent of the CEOs interviewed for a new study by management consulting firm A.T. Kearney believe e-business is the main challenge facing them today. Nevertheless, nearly three-quarters (72%) of the executives said their companies are extremely or moderately active in creating or maintaining an e-business strategy, and 57% said e-business has changed the way they conduct business.
The study, based on interviews with 251 CEOs from 26 countries across 10 industry segments, points to the elusive nature of the digital revolution. Doug Aldrich, the A.T. Kearney vice president who led the study, says, “While ‘chaos at the top’ may be too strong a phrase, the data clearly underscores the confusion that reigns in boardrooms today about e-business and its relevance to business strategy, products, and services.”
E-business at work
The study reveals executives recognize the significance of e-business to the future success of their companies, but are careful not to characterize it as the sole determinant of success. When given a list of options, 37% of the surveyed executives said that “technology alignment with business strategy and integrating existing technology” is the strategic issue of most concern to them, while only 29% named “e-commerce initiatives.”
Of the companies actively pursuing an e-business strategy, 57% reported that their e-business strategy is extremely or moderately integrated with their company’s overall business strategy. However, only one percent viewed e-business as a critical success factor today, and only five percent identified it as critical in the next three years.
Despite that, nearly 75% believe that e-business will have either an extremely or moderately significant impact on future product offerings, compared with 41% who characterize the impact on current product offerings as such.
CEOs appear to view some of their most significant e-business impediments as internal ones. The top two challenges to managing and implementing their e-business initiatives cited by CEOs were organizational structure/existing business processes (26%) and lack of properly trained personnel (18%).
The study also found that despite the rapid and highly publicized rise of business-to-business (B2B) trading exchanges, fewer than half (44%) of responding executives said they are serious about participating in such B2B ventures.
“Almost overnight, the Internet has changed the rules of engagement that previously guided the interaction of businesses with their customers, suppliers, and alliance partners,” Aldrich said. “It’s not surprising that the e-revolution is causing confusion in the business community, but what is startling is the extent of it.”
Digital divide between regions
The study also found a “digital divide” on e-business exists in the various regions around the world. CEOs of North American companies reported a higher level of e-business activity for their firms-81%–compared with 72% in Europe, and 65% in both Asia and Central and South America. However, perceptions of the current and future impact of e-business varied greatly by region.
In North America, 78% of North American executives said the Internet had changed the way they do business, compared with 64% of Asian executives, 46% of European executives, and 29% of Central and South American executives.
Seventy-nine percent of European executives predicted e-business would have a significant impact on future product offerings, compared with 71% for Central and South America, 67% in Asia, and only 59% in North America.
More than half of the North American executives cited the impact of technology and of e-business as their main challenge over the next three years. This compares to 25% for European executives, 20% for Asia, and 18% for Central and South America.
About the report
Copies of the full report are available at A.T. Kearney (www.atkearney.com), a management consulting subsidiary of information technology (IT) services provider EDS (www.eds.com).
Corporate America is going mobile
Large U.S. firms are looking to wireless technology to support nearly 1 million users in remote offices and almost 5 million telecommuters
Corporate America is indeed going mobile, according to Cahners In-Stat Group, a high-tech market research firm. As the year 2000 marks the rapid extension of the enterprise across multiple boundaries, large firms (1,000 or more employees) are struggling to manage growing numbers of mobile workers, remote branch offices, and telecommuters. In-Stat estimates that large firms in the U.S. support nearly 1 million remote office locations around the globe in addition to roughly 5 million telecommuters, an average of 96 locations and more than 450 telecommuters per firm. By 2004, the average large corporation will support approximately 153 remote branch offices and 660 telecommuters.
In order to increase the accessibility of this growing remote workforce, large companies are using wireless devices to keep many employees productive, even while they’re on the go. This year, more than 13 million enterprise employees will use wireless phones and other similar devices;by 2004, large firms are expected to employ more than 29 million wireless-enabled workers.
- Nearly 70% of employees have access to the Internet at work and more than 80% of employees have access to their company’s network in 2000.
- By 2004, 90% of employees will be connected to the corporate network either by the Internet, directly via PCs, or through a growing variety of supply chain/production floor devices.
About the report
The report, Economic Profile: Facts & Stats for the Enterprise Market (#DL0001MS), provides the market demographics and technographics that define the enterprise market, including the number of remote branch offices supported and Internet-accessing telecommuters. To purchase this report or for more information, please visit http://www.instat.com/ or call Matt Woods at 617-630-2139; [email protected]. The report price is $995 USD.