CALIFORNIA, 15 July — E-business and e-commerce initiatives have taken the world by storm. The promises of associated mega-value propositions have prompted all types of worldwide businesses and other governmental and non-governmental institutions to start wading in the waters of e-business.
E-business can be defined as conducting an organization’s business over the Internet. E-commerce on the other hand can be considered as all e-business processes involving financial transactions. E-business initiatives potentially hold numerous benefits for an organization. In a nutshell, e-business initiatives provide enterprises with three primary avenues of transformation and opportunity.
First, e-business provides an organization with more opportunities for generating revenue. This comes about due to an organization’s ability to deal with a wide spectrum of business partners and customers connected by the Internet.
Second, an organization can espouse e-business to transform and streamline its internal business processes. This can directly result in reducing internal costs and overhead.
Finally, an organization can use e-business initiatives to provide higher levels of customer satisfaction. An organization can achieve this by empowering its customers with more information about its products and services, thus helping them in their decision making. Organizations can also provide post-sales customer support over the web and also provide access to self-service applications, e.g. banks can provide customers with the ability to conduct financial transactions such as querying bank balances, paying bills, etc.
The fact that Saudi-Arabia is in the early phases of building its Internet infrastructure holds numerous opportunities. Where the West struggles to enable its short lived second generation computer applications for the Internet and the World Wide Web, Saudi organizations which have not yet ventured into e-business waters can circumvent that step and directly build Internet-enabled applications. Second, as the recent dotcom crash in the Western world exposed the vulnerabilities of certain e-business models, Saudi businesses can appropriately avoid similar potholes. Finally, Saudi organizations can begin to institute the various policies and procedures related to Internet security, law and others — issues that the Western organizations had to struggle and grapple with after they had embarked upon e-business initiatives.
As the governmental and commercial sectors continue to fortify the Internet infrastructure for widespread commercial adoption, Saudi firms should seize the opportunity to e-business-enable their operations in four distinct phases.
In the first phase, businesses should start building “internal Internets” also referred to as Intranets. Intranets embody Internet-related technologies and can thus seamlessly connect to the Internet. For businesses, these Intranets will provide the foundation for their internal business applications and will interconnect all their employees. Formation of Intranets will further aid organizations to switch their employee-base from dumb terminal and second-generation computer applications to a web-enabled environment. Building of the Intranet will also drive organizations to start experimenting with Internet related technologies that in turn will push Saudi businesses to cross the chasm quicker to hop on the Internet environment when it is ready for commercial activity. This will refocus their investments more strategically rather than investing in stopgap technologies. The standardization of the world around Internet technologies will make it less likely and painful for an e-business-enabled enterprise to progressively mature its systems and processes.
Subsequent to the building of the Intranet, the next step for Saudi firms is to invest in building an electronic communication and collaboration infrastructure. Besides providing an organization’s users the ability to electronically communicate and share information internally, this will prompt the transition from a paper-laden environment toward the establishment of a paperless environment. This transformation in mindset and technology infrastructure also provides the necessary foundation for the building of knowledge portals and repositories that in turn will facilitate the capture and sharing of intellectual capital that employees generate in the form of ideas and other project work. In Saudi Arabia where businesses suffer a continual loss of intellectual capital due to high employee turnover, businesses therefore can start to retain that capital in such knowledge repositories.
The third area of focus involves rejuvenating the existing computer application base. Today’s business processes need to be simplified, packaged with more functions, re-engineered to streamline business processes and given the limitations of the Internet infrastructure, need to start interfacing with other business partners’ applications. For example, manufacturers can streamline their supply chain operations — the manner in which they link to their distributors — and financial institutions can offer opportunities to link more openly to businesses to facilitate financial transaction activities.
Finally, as Saudi Arabia enjoys a large population of mobile phone users, organizations should explore maximizing the use of such information appliances. For example, through these mobile phones, banks can explore providing their retail customers the ability to check account balances, pay bills and other such functions that can directly reduce the burden on both the customers and businesses. Similarly, airlines can venture into providing customers mobile phone-based services to handle tasks such as basic schedule querying and making reservations.
When approached intelligently, e-business holds numerous opportunities. However, reaping the benefits of e-business requires the development of unique business visions suiting each enterprise and a renewed business strategy. Based on this vision and strategy, each firm should clearly stipulate the value propositions that it expects to reap from such e-business initiatives. Finally, successful execution of the above-mentioned steps requires revisiting plans for focusing resources and technology investments for e-business enablement.