Sometimes the future takes a long time to arrive. Many a company observed the stupendous rise of the Internet and concluded that a rich commercial future lay in cyberspace. Much expense was duly incurred in jockeying for position in this brave new world. But a mighty catch lay in wait for those attacking the corporate market. A year ago, even among very large UK companies, few were Internet-friendly.
Even in groups owning a web site, departments and functions were not involved with the Net - and few companies had gone interactive. Using the Net for transacting regular business is an attractive concept, but not yet an established practice. Many would-be suppliers found themselves running fast up the down escalator, and, not surprisingly, some gave up. Yet everybody, from customers to IT suppliers, recognises that the digital revolution must take over the bulk of transactions - as it has already seized communications.
As more and more companies get wired up and wised up, the yawning gap between present-day potential and practice is beginning to close fast. Earlier this year, at a packed Cable & Wireless Communications seminar on the Internet's business uses (which are to all intents and purposes infinite), the assembled information systems and other managers had plainly been drawn by the rich promise. Although hardly any of their companies had even one Internet project in hand, bringing performance into line with that promise is only a matter of time.
But the existing gap isn't even half the story. Present-day potential lags far behind future developments: the technology is still ramifying at mind-boggling speed. According to Richard Howard, director of wireless research at Lucent Bell Laboratories, 'The pace of change is actually accelerating now.' The next two decades will 'see explosive growth of communications, computing, memory, wireless and broadband technology.' Inevitably, this will have powerful impacts on business that will leap beyond the transformation already achieved - and already taken for granted.
Internally, intranets will become the universal electronic linkage for organisations, not only bringing real improvements to basic functions, like communication, databases and reporting, but opening the door to the decisive corporate power: knowledge. Companies will be devoting their best efforts, to quote Chuck Lucier of Booz Allen Hamilton, to the quadruple task of getting managers and others to (1) share best thinking, (2) use other people's ideas, (3) collaborate with other experts, and (4) evolve their thinking.
Lucier was talking to Simon Caulkin, writing for Management Today, about 'knowledge management', the latest hot idea to hit the corporate agenda. Management is required because the four above knowledge elements, while brilliantly facilitated by networks, don't come naturally to humans. The breakdown of departmental and disciplinary barriers, which obstruct the knowledge flow, and their replacement by a knowledge-centred, horizontal, fluid, organic culture, is a test of management. The companies which pass that test, and which best exploit their internal accumulations of knowledge, plus their now unlimited access to external sources, will win in the marketplace.
Meeting the market, too, may require major adaptation. Many current operations will become endangered species. For instance, Bill Joy, who heads research for Sun Microsystems, told Business Week that the trends will 'carve middlemen out of transactions.' In PCs, firms like Dell Computer have already carved away: Dell even maintains a round-the-clock direct selling operation on the web. But Joy envisages more: 'online auctions' in real time that could end, for example, the differential pricing which forces business travellers to pay more for airline tickets than occasional fliers. Networks will 'give people access to what things are really worth, defined by what people will pay at that minute.'
Since the cost of networks is dropping as fast as they spread, no management can afford to stay on the sidelines as the revolution gathers pace. A fascinating survey by Business Week shows how advanced electronic research is exploding in all directions and could result in computers very different from today's boxes, with their windows, icons and often clumsy programs. What these many and varied changes promise is much easier use and ubiquity at much lower prices: the cost of a given amount of computer power halves every 18 months.
Now business managers can with confidence ask for the moon, so to speak. What information and communication do you ideally require? Almost certainly, it's yours: if not today, tomorrow. So the strategic programme is clear. Plan ahead in full awareness of the impact that the digital revolution may have on the business, internally and externally. Ensure that the corporate and information and communication strategies are Siamese twins. Plan future systems to fit the strategic needs, while elevating systems in use to state-of-the-art quality in order to provide the foundation for the future.
Remember, above all, that this is not pie-in-the-sky, but sober reality. Waterstone's and Dillons, two leading UK booksellers, have just been compelled to open Internet sites on a vast scale - offering over a million titles apiece - to compete with US online booksellers led by amazon.com. Whatever the pace of development with these two operations, the books business will be radically changed. Other businesses only await perfectly predictable improvements to follow in the booksellers' footsteps.
Footsteps is le mot juste for one electronic shopping requirement: a means of measuring feet to get accurate fitting of shoes online. If that sounds fanciful, a Japanese firm named Paris Miki, which sells more eyewear than any competitor, already allows customers to try a large range of options on a digitised picture of their faces before selecting, and swiftly getting, the best combination. That's a natural for online shopping, which is only one aspect of an already victorious revolution.
To quote Caulkin, six years ago US industry 'spent more money on information technology - equipment to capture, process, analyse and distribute information - than on production plant and equipment.' Only imagine how the spending lead has enlarged since 1991. By 2001 the online world will be every company's world.
