4.1.5. Updating one’s knowledge on Net Economy
Despite the necessity to set up a business intelligence system for a virtual enterprise to solve specific and daily questions (ex : to find the right tool for the right matter), it’s important for the manager and his collaborators to be regularly aware of the new trends of the NET ECONOMY.
The best way to keep aware without loosing a lot of time is:
A few references of sites to visit:
Bibliographic references:
4.1.1. Definition
The Net economy is based on the Internet rise which has fundamentally changed the way enterprises do business. In the past, interactions with partners and customers were controlled and quite circumscribed. Technology evolved less rapidly, and as a result the business environment changed in a much more gradual and predictable way.
The rise of Internet, and its infiltration of mainstream business, is putting intense pressure on this slower, more relaxed approach to business, is putting intense pressure on this slower, more relaxed approach to busines. To prosper in the Net Economy, large companies must become Entrerprises Service Providers (ESP's), providing services to large communities of partners, customers, and suppliers with the Net. They must cope with a business environment that is evolving in a rapid and unpredictable fashion, driven by the lightning-fast evolution of technology.
4.1.2. Internet history
This also led to the name of the World Wide Web Association, which is the worldwide watchdog for Internet integrity.
Free access to the Internet also engendered the creation of a global computer power.
Commercial transactions began to take place over international network that had no geographical location and it became practically impossible to know the geographical origin of a request for a purchase or for information.
4.1.3. The Various Phenomena that Characterize the Net Economy
A. electronic market places
Organized like stock markets, they use Internet technologies to transpose
the concept of intermediation by financial brokers to the entire economy:
whether this concerns relations between subcontractors and automotive
manufacturers or the purchase of office supplies, market place managers
pay themselves by taking a commission on each transaction that takes place
on their market place Internet site.
One of the first of these was created in 1999 by the Ford motor company
and the Oracle database software publisher.
This site contains the calls for tender issued by Ford, which can be consulted
at any time via Internet, and the responses and proposals made by subcontractors
and equipment manufacturers. As the co-manager of the market place, Ford
also receives a commission on each transaction made through this intermediary.
B. Electronic commerce
This consists of using the Internet for remote sales of products and is gradually reaching all businesses throughout the world, both large and small.
One of the first online merchants was the famous American bookseller Amazon, founded in 1995.
In 2000, e-commerce accounted for 5.3% of the GNP in the USA, compared to 1 or 2% in Europe.
Analysts expect European countries to catch up with these proportions, particularly with the emergencece of wireless e-commerce (on the Internet via mobile phone or portable computer).
In 2004, the weight of Europe in electronic commerce should reach 22%.
There are three main categories of players in electronic commerce:
C. The new jobs related to the Net Economy (knowledge professions)
These are the professions related to the production and research of information on the Internet:
From business intelligence worker to infomediary
The person working on technology intelligence has been transformed by the Internet to an infomediary, an expert in the use of computer networks. He focuses on the area of technology intelligence and business intelligence (BI). His functions are half-way between those of the documentalist and those of the information consultant.
He selects and processes the information and provides added value with the help of knowledge management software.
These professions do not replace those of computer technicians, however.
D. New economic practices
- Dematerialization
Whether it is music or movie software or simply economic information, the production industries create products that are no longer material in nature, to the extent that the networks and the Internet in particular have made it possible to download the software or music to a computer, at practically no cost.
In addition, downloads are an effective way of winning customer loyalty.
- The appearance of application software (ASP - Application Service Provider).
The possibility of downloading non-material merchandise introduces new relations between computer users and suppliers.
One of the leading application softwares leased via Internet electronic messaging.
Application software leasing via Internet is accessible throughout the world and available 24 hours a day. One can pay for all of a program or only certain functions when the software is installed on the service provider's Internet site.
In a rapidly evolving economic context, property becomes synonymous with risk for two reasons:
- any equipment is outdated before it is even used.
- Property becomes a dead weight that can impede the progress of a business by preventing it from moving from one sector to another.
The services emerging from the transformation from products to services are increasingly numerous.
"immaterial value is growing faster than material value."
Stan Davis and Christopher Mayer: Blur: The Speed of Change in the Connected Economy.
- CRM (Customer Relations Management)
Software dedicated to optimizing customer relations management has revolutionized sales and marketing methods and changed the organization of businesses.
The WAP (Wireless Application Protocol) system may also mark a change for consumers and therefore for suppliers.
4.1.4. Consequences
We are therefore moving from an economy based on material technologies to one based on immaterial technologies.
The market logic changed at the end of the 20th century: the customer is now an economic player in his own right and holds a new kind of power.
There is sales or purchasing software on the Internet (configurators) that is dedicated to the customers and lets them precisely, interactively define the characteristics of the product they wish to purchase.
Electronic messaging has also contributed to ephemeral or permanent business or interest community networks, purchasing pools that announce their preferences and launch bid calls.
Some professional interest communities also provide technology intelligence for their members.
Leasing, new practices, free transactions are thereby becoming fundamentals of the Net Economy.
Three categories of players:
Information has the central role and it is becoming industrialized.
The computer industry has been transformed into an information supplier.
The production method for immaterial goods is rooted in traditional production.
However, it is a part of a process of optimization rather than of substitution.