If there’s one thing we've learned about e-business
it’s that "the only constant is change." According to Martin Anderson,
co-director of "Babson Center of Business in the Networked Economy," the
worldview divides e-business into three categories:
Brick and mortar businesses. These are the old
fashioned dinosaurs that make screen doors, engine castings, and lumber
that must be sold through the soon-to-die brick and mortar retailer.
Virtual businesses. These are alleged to exist
mainly in cyberspace. They are held out as the leaders of the new age
that will have all of us working anywhere we want, while we spend quality
time with our kids, dogs, or BMWs. Investors love them because they supposedly
have low assets and potentially infinite returns.
Click and mortar businesses. These are the emerging
hybrid businesses that supposedly bridge the old and new ages by adding
".com" to the old physical world.
According to Anderson, "Everything changes, including
management, when moving between these e-worlds of operation."
The following is MWorld’s exclusive "Brick-Click-Brick"
interview with Anderson.
Mworld: Is the functionality of cyberspace really that
different than traditional retail space?
Anderson: The traditional and e-world business models
are completely different, which is something many merchants fail to understand;
even front-runners like amazon.com, which really is not prospering all
that well. Amazon.com was good with books but had to move more horizontal
to make the business model work and has not had much success as an "e-tailer."
Mworld: If you had to pick the biggest "don't" and
biggest "do," what would they be?
Anderson: The biggest "don't" I can offer is: "Don't
prepare a budget plan longer than 6-12 months because e-world changes
are too rapid to take in the long-view." The biggest "do" I can offer
is: "Do hire an ambiguity manager as a part of your management team. These
e-managers can help develop lists of things to do (for management and
employees) that other traditional managers can't. Any successful e-business
I have seen has had at least two of these ambiguity managers who possess
a "gestalt" view of the e-world that translates into actionable items.
Mworld: Do these ambiguity managers have different
traits or skills?
Anderson: Yes. Leaders in the e-commerce world have
a specific acquired knowledge as well as personality characteristics that
can absorb the outside world of confusion and direct employees along the
proper path. These leaders possess the radar that can take short-term
customer needs and turn them into demands easily understandable by the
internal staff.
Mworld: Does this hold true when moving from brick-to-click
and back again?
Anderson: Absolutely. For example, most successful
e-businesses have inventory pre-shipped to customers, which entails, among
other things, a high-cost, rapid delivery system. For this, customers
will pay a $5 to $9 charge for quick turn-around. Conversely, with brick
and mortar, you have to have an inventory system close to your customers.
The first debate (when moving back and forth between these e-worlds) is:
"Do you keep systems separate because it’s easy to pull e-stock from current
inventory control?" And the answer is, yes. It’s imperative that you create
a separate system for each world because each has separate demands.
Mworld: Can you give me an example of one company that
has successfully made the transition between the real and virtual worlds?
Anderson: Hannafords.com is hands-down the most successful
e-business to pull this off. Hannafords.com is a supermarket chain that
has managed to successfully transverse both worlds, moving fluidly between
free-standing retail and cyberspace. They did this by creating a separate
e-driven entry. They made changes internally utilizing their current management
staff, but they created the Learning Corporation, which took the best
people and best practices and then continually experimented -- piece by
piece. And if something didn't work, they shut it down immediately. That’s
the key: Separate functions, watch what works, and shut down failures
right away.
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