Download - What's Happening?! Lucent just reported another bad quarter ...

What’s Happening?!What’s Happening?!

Lucent just reported another bad quarter with profits down 53%.

Motorcycle sales are at the highest level since 1979.

American Airlines reported a $387 million loss for the final quarter of 2004. Northwest reported ($420 million)

eBay’s earnings weren’t as great as expected and raised concern about slowing growth in corporate profits in 2005.

Analysis Term PapersAnalysis Term Papers

Contacting the companies you are evaluating is not necessary and in some cases not very practical.

Oracle Industry DefinitionOracle Industry DefinitionDatabase System and Enterprise Application Software Industry.

Business Strategy Model:Product Strategy: Software categories, operating systems and processor categories.Customer Strategy: Categories of targeted customers.Market Strategy: Geographic Development Strategy: (in lieu of manufacturing)Sales/Distribution: Field sales force, Internet direct, Value-add resellers, retailers.Company Structure:Information Systems:

Computer Software

General-Purpose

ApplicationPrograms

Application-Specific

Programs

SystemManagement

Programs

System Development

Programs

ApplicationSoftware

System Software

ComputerSoftware

MS Office Groupware Integrated Desktop

Packages

Business, Accounting & Finance Engineering ERP, SCM, CRM, etc.

Operating Systems Network Management Database Management Systems Utilities Performance & Security

Programming Languages Programming Editors CASE Packages

Intel Industry DefinitionIntel Industry Definition

Semiconductors is too broad.

Microprocessors is too narrow.

PC Component IndustryMicroprocessorsMotherboardsNetwork devicesMemoryStorage

Chapter 4 ConclusionChapter 4 Conclusion

Airline Industry AnalysisAirline Industry Analysis

The PlanThe Plan

Why the airline industry? The Porter Competitive Model Business Strategy Model Importance of IT to the airline industry Conclusions

Airline IndustryAirline Industry Learned the Porter Competitive Model in

Chapter 3

Apply this to the airline industry– Why the airline industry?

» Boundaries are clearly defined» Highly visible» Well-known industry» One of two technologies that are globalizing the business

world

Porter Competitive ModelPorter Competitive Model

Intra-Industry RivalrySBU: American Airlines Network Rivals: United, Delta, US Air, NorthwestLow-cost Rivals: Southwest,JetBlue, ATA, etc.

BargainingPower of Buyers

Bargaining Power

of Suppliers

Substitute Products

and Services

PotentialNew Entrants

Airline Industry Analysis – U.S. Market

•Travel Agents •Business Travelers•Leisure Travelers•Charter Service•Federal Government•U.S. Military•Cargo and Mail

•Alternate Travel Services•Fast Trains•Boats

•Private Transportation•Videoconferencing•Groupware

•Aircraft Manufacturers•Aircraft Leasing Companies•Labor Unions•Food Service Companies•Fuel Companies•Airports•Local Transportation Service •FAA•Hotels

•Foreign Carriers•Regional Carrier Start ups•Cargo Carrier Business Strategy Change

Figure 4-2

Conclusions - Porter ModelConclusions - Porter Model Competition within the US is intense Customer is always first Power of suppliers is mixed

– Labor unions have strong bargaining power– Aircraft manufacturers, fuel and food supplier

power shifts to airlines Potential new entrants are still a threat Substitutes could become a major problem

– Video conferencing

Europe North American Pacific Rim

Low Fare Premium Fare

Independent Alliances

Figure 4-1

Latin American

Passengers Operations Logistics Business

Product/Service StrategyScheduled Passengers

Charter Services Cargo

Mail Air Express

Code Sharing

Business Strategy

Model –

Airline Industry

Customer/Fare/Market StrategyBusiness Travelers

Leisure Travelers

Senior Citizens

First Time Flyers

Frequent Flyers

Sales StrategyReservation Agents Travel Agents Web Page

Super Saver

Company Structure Strategy

Information Systems Strategy

Short Haul Long Haul

Hub and Spoke Point to Point

Routes and Route Structure Strategies

Importance of IT to the IndustryImportance of IT to the Industry Why is IT important?

– Volumes of data– Complexities based on the number of flights and

connections– Critical time windows dictate a need for real-time data

IS examples– Reservation system– Yield management systems– Operational information systems– Business systems

Importance of IT to the Industry Importance of IT to the Industry ContinuedContinued

Convenience to customers

Knowledge of Customers

Providing a foundation for other systems

Building a foundation for other businesses

ConclusionsConclusions Questions for airline industry:

– Can they make a profit as privately held companies?– Maintain a public service responsibility?– Provide an effective strategic resource for their home

country? A vivid example of the dynamics of the markets

that it serves Need to establish strategies dictated by these

markets Provides a good example of IS that can effectively

and successfully support core business strategies An important chapter for our paper

Possible Exam QuestionsPossible Exam Questions

1. Identify and explain two major benefits that information systems have provided for the airline industry.

2. Based on the Porter Competitive Model, explain “new entrants” and “substitutes” conceptually and then explain the impact that they have had on American Airlines.

Chapter 5 IntroductionChapter 5 Introduction

Information Systems Can Information Systems Can Redefine Competitive Redefine Competitive

BoundariesBoundaries

To understand the role and significance of:• Inter-organizational Systems.• Business process changes involving

customers and suppliers, with an emphasis on supply-change management.

• Multiple forms of strategic business alliances.

Objective Of the ChapterObjective Of the Chapter

Efficiency• Ex. Transmitting purchase orders

electronically eliminates paper flow and manual input on a more timely basis.

• More accurate and provides better customer service.

• More cost effective.

Interorganizational SystemsInterorganizational Systems

Effectiveness• The broadening of the scope of tasks.• Breaking down barriers between

companies make communication more effective, on a more timely basis, and get the job done.


Competitive advantage through customer service:

• We are available.• We are interested in you.• We are responsive.• You can count on us.• We want to earn your trust and respect.


Competitive advantage through strategic alliance.

• Build a combined capability that makes your company a stronger competitor.

• “Our extended enterprise versus your extended enterprise.”


Figure 5-1


Industry Forces

Company

Customers

Vendors

Support Services

Business Partners

Competitors

• Still a common form of data interchange despite the presence of the Internet.

• The Internet has brought extranets into prominence. • Exchange of routine business transactions in a structured,

computer-processable format.• EDI Example -- Mervyn’s

• Vendors and freight companies.

Electronic Data Interchange (EDI)Electronic Data Interchange (EDI)

• Extranet Example – Intel’s Rosetta Net links with its customers.

Business AlliancesBusiness Alliances

Selection of business partners is an Selection of business partners is an important factor in positioning a company’s important factor in positioning a company’s competitive strategies.competitive strategies.

Evaluation criteria should emphasize Evaluation criteria should emphasize building on mutual strengths and avoiding building on mutual strengths and avoiding an attitude that an alliance is to address a an attitude that an alliance is to address a weakness.weakness.

Building AlliancesBuilding Alliances

Difficult to accomplish.Difficult to accomplish.

Needs to be an on-going effort.Needs to be an on-going effort.

Important to clearly determine roles, Important to clearly determine roles, responsibilities, performance criteria, responsibilities, performance criteria, ownership and how to terminate the ownership and how to terminate the relationship.relationship.

“International expansion is not a choice but a strategic imperative for all growing, high-performance companies.” 1994 conference of US Manufacturing companies.

• The more global, the better.• Best performers were multinational companies

who were in the three major markets: North America, Europe and the Pacific Rim.

Global BoundariesGlobal Boundaries

• Interorganizational systems are effective, efficient and help gain a competitive advantage both through customer service and strategic alliance.

• Globalization is a very important factor for a company's success.

• EDI systems have helped companies speed up business transactions without the use of paper work.

In Closing…In Closing…

Chapter 5 Chapter 5

Information Systems Can Redefine Competitive

Boundaries

Chapter TopicsChapter TopicsA. Interorganizational Systems aka Extranets aka B2B

B. Electronic Data Interchange (EDI) (Extranets versus EDI?)

C. Strategic Alliances

With an added dose of globalization.

Chapter QuestionsChapter Questions1. Which word—global, international or interdependent—best

describes current markets, products and services, and business relationships?

2. Why is growth such an important part of business success?

3. What is an extended enterprise and why is it an important competitive consideration?

4. What role does information technology play relative to an extended enterprise?

5. Have the physical limits of strategic alliances disappeared because of current network capabilities?

6. Do strategic alliances really work and if so, why?

Topic ATopic AInterorganizational Systems and Extranets are defined as automated information systems shared by two or more companies. Enhance business relationships. Establish strategic alliances. Gain efficiencies. Gain effectiveness. Lower cost of doing business.

Interorganizational System Interorganizational System and Extranet Goalsand Extranet Goals

Efficiency

Effectiveness

Competitive Advantage

Competitive AdvantageCompetitive Advantage

Advantage can be gained through better customer service that accrues from systems that connect a company to its customers.

Because of the Internet, aren’t all customers potentially connected to a company?

Customer Satisfaction Becomes a Customer Satisfaction Becomes a Key FactorKey Factor

Do systems and policies say loud and clear to a customer:– We are available.– We are interested in you.– We are responsive.– You can count on us.– We want to earn your trust and respect.

Topic B - Strategic AlliancesTopic B - Strategic Alliances

How (why) do they work? Companies bring strengths to the alliance

table. Alliances create long term advantages. Alliances drive business growth. Alliances often represent a difficult

transition.

Strategic AlliancesStrategic AlliancesWhy establish a strategic alliance? To build a combined capability that makes it a

stronger competitor. Extended enterprise against the competitor’s

extended enterprise. Difficult, costly and risky to try to deal with the

challenges of a global business. Alliances that are based on dealing with

weaknesses fail more often than those that are based on combining strengths.

Topic C - EDI Topic C - EDI Electronic Data Interchange (EDI) (Predecessor to extranets)

Exchange of routine business transactions in a structured computer-processed format. Traditional applications included purchasing, pricing, scheduling, payments and financial reporting.

Why stay with an EDI system?Why stay with an EDI system?

1. It is established and proven.

2. The network costs are not large enough to justify switching to an extranet approach.

3. There are other priorities within the organization.

EDI ExamplesEDI Examples

Boeing Parts Logistic System: Provides information

regarding parts availability to support aircraft maintenance.

Links with contractors in Japan and U.S.

EDI Value-Added Network ServicesEDI Value-Added Network Services

Two major elements: Telecommunications network. EDI application translation support.

Connects Trading partners: Broad range of geographic locations. Provides network management-multiple routing

paths and security.

(Would probably be called an ISP or ASP today)

The Benefits of a VAN (ISP or The Benefits of a VAN (ISP or ASP and the Internet) ASP and the Internet)

Having 24-hour service on demand. Gaining access to national and international

networks to connect to trading partners. Support for multiple telecommunications protocol

conversions. Interchange support for even a smaller number of

transactions, since you only pay for the services that you actually use.

Boundaries?Boundaries?

Across town?

Throughout the state?

Across multiple US regions?

Encompassing the entire US?

North America?

Western Hemisphere?

Multiple Continents?

Total World?

Customers?

Suppliers?

Support Service Providers?

Business Partners?

Industry Forces, Associations, Government?

Mobile employees relative to the above?

Interorganizational SystemsInterorganizational Systems Is this just another name for outsourcing?Is this just another name for outsourcing? Is there any difference between sending work Is there any difference between sending work

from Santa Cruz to San Jose and sending it from from Santa Cruz to San Jose and sending it from Santa Cruz to Bombay?Santa Cruz to Bombay?

According to Gartner, 10 per cent of info tech jobs with US based technology companies were to be based in countries in emerging markets by the end of 2004.

The trend is not new and may be overstated.

It is unlikely that the federal government will do anything to limit or ban outsourcing.

The Best Term?The Best Term?

• Global

• International

• Interdependent

Globalization DriversGlobalization Drivers

• Customers are global.

• Channels are global.

• The marketplace is global.

• Products that travel.

The InternetThe Internet Provides the ability to slash transaction and

partnering costs between companies. It supports the ability to mesh information, data

and processes with other entities to created a new infrastructure for creating successful customer relations.

This is a rising tide that doesn’t lift all boats. Only the right business model backed by the right

business strategies will lift a specific boat.

Toyota DiversificationToyota Diversification

At a time when diversification is often suspect, Toyota, guided by a historical perspective, is moving into other areas such as prefab housing and especially telecommunications.

Toyota PerspectiveToyota Perspective

The company’s plan is driven by historical cycles dating to the 1700s that suggest that a single line of business rarely prospers for more than sixty years.

“We are not arrogant enough to believe that the automobile business can be profitable perpetually.”

The waves of change are reflected in the dominant infrastructure of the time.

In 2000 they achieved 10% of sales ($10 billion) from outside the auto and truck business.

Prevailing InfrastructurePrevailing Infrastructure

1800 Canals

1850 Railroads

1900 Highways

1950 Telecommunications

Airlines?

Interstate Highway SystemInterstate Highway System Created the modern economy and reshaped the Created the modern economy and reshaped the

companies on the Fortune 500.companies on the Fortune 500.

A major public works project involving 42,793 A major public works project involving 42,793 miles of pavement.miles of pavement.

Bill signed by President Eisenhower on June 29, Bill signed by President Eisenhower on June 29, 1956.1956.

Impact of Interstate Highway System Impact of Interstate Highway System

Lead to an America that was more mobile, less plagued by regional differences, and vastly wealthier than before.

Sold as a savior for rural America and declining urban core.

Instead it accelerated the trend toward suburanization. Accelerated the transformation to chain restaurants, hotels,

stores, chain everything. The combination of the new highway system and shipping

containers enabled overseas manufacturers and small domestic companies to get products to market faster than ever before.

Highway System PerspectiveHighway System Perspective Federal funding of highways in the US began in 1916 but

became significant in 1956. Highways became a state versus federal issue. Wealthy states built their own. Poorer states were unable

to do so. Southern states gained significant economic benefits from

the federally funded highway system. By eliminating its transportation disadvantages southern

states attracted manufacturers, retailers and shipping companies.

Boom cities of the second half of 20th century did their growing along the lines determined by Interstate planners.

Los Angeles, Atlanta, Dallas, San Jose, Denver, Phoenix and Las Vegas.

Impact of Interstate Internet Impact of Interstate Internet Highway System Highway System

Lead to an America that was more mobile, less plagued by regional differences, and vastly wealthier than before.

Sold as a savior for rural America and declining urban core.

Instead it accelerated the trend toward suburanization. Accelerated the transformation to chain restaurants, hotels,

stores, chain everything. The combination of the new highway system and shipping

containers enabled overseas manufacturers and small domestic companies to get products to market faster than ever before.

Necessary QuestionsNecessary Questions1. How does the Internet impact the structure of the

company?2. Is a networked enterprise a better vehicle to

compete and succeed than a vertically integrated approach?

3. Does this dictate that a company needs to be smaller to be agile, flexible and responsive?

4. Can enough of the benefits of the Internet be realized through intranets, extranets and similar techniques?

Necessary QuestionsNecessary Questions

5. Should mergers be emphasized to realize a virtual company approach?

6. Does outsourcing an important business function represent loss of control?

7. How is this different from traditional outsourcing?

8. How do you decide what is a core function?9. What happens next that will dictate a major

change?

Internetworking The GlobalEnterprise

EmergingGlobal

Markets

Global BusinessOperations &

Alliances

InformationTechnology

Globalization

Information Technology and Globalization

Transportation Technology

Drivers of Change

Competitive Environment

Business/IT Strategy

Business Implementation

“Products that travel”

Global MotivationGlobal MotivationOffense/Defense—Opportunities/Threats

Global economies of scale to recoup R&D and capital costs.

Build and strengthen global brands—economies of scope.

If your competitors have established a global position do you really have a choice as to whether you should also compete on a global basis?

Acknowledges the better standard of living and increased mobility of a greater number of people in countries around the world.

ThereforeTherefore1. Grasp the opportunities and challenges of the

global marketplace.

2. Generate and focus the personal skills and organizational energies needed to attack the global opportunities and challenges.

3. Transform these efforts into world-class performance.

A Sobering ThoughtA Sobering Thought

“It takes at least 25 years to build an effective global management team.”

Alfred Zeien

Former CEO, Gillette

IOS ConclusionsIOS Conclusions

• Successful small information systems tend to grow into larger systems.

• Interorganizational systems are changing business processes, strategies and relationships.

Changes in Concepts, Terminology Changes in Concepts, Terminology and Networksand Networks

• E-Business and E-Commerce

• Core Processes and Outsourcing

• Internet as a global, standardized network

• Business Alliances

ScopeScope

E-Commerce versus E-Business.

Front end versus business strategies, core business processes, policies and practices geared to succeed with an E-Commerce approach.

Basic Business PrincipleBasic Business Principle

If there is no payment, there is no business transaction.

No business transactions translates to no business revenue.

No business revenue results in a bankrupt business.

US Consumer Payments

0% 10% 20% 30% 40% 50%

Electronic Payment

Other Paper Methods

Debit Cards

Credit Cards

Checks

Cash

US Payment Systems $ Purchase Volume

0% 10% 20% 30% 40% 50% 60%

Other

Cash

Cards

Checks

Payment Process IndustryPayment Process Industry

Member Banks

Visa, Mastercard, Discover, Amex

Merchants

Cardholders•Businesses•Individuals

Dell ComputerDell ComputerOccasionally, rarely, history is made when a gifted leader, who has a vision of new processes and technologies, produces a brilliant new business model. Henry Ford did it in automobiles and Michael Dell has done the same in PCs. The parallels are remarkable.

Jacques A. NasserFormer President and CEOFord Motor Company

Dell ComputerDell ComputerDell Computer is a great American success story.

This all happened because Michael Dell started selling computers from his dormitory room while he was a student at the University of Texas. When he consistently grossed $30,000 a month he concluded that he was onto a business opportunity that was too good to pass up.

He quit school as a pre-med student and founded Dell Computer in May 1984.

Ford and Dell?Ford and Dell?

Appreciated the principle of elasticity of demand.

Emphasized innovation in manufacturing.

Vertically integrated. (Ford in-house, Dell outsource)

Stressed standardization and modularity of product.

Passed cost savings along to the customer.

Stressed innovation with a product in a relatively new industry that fundamentally changed the industry.

The popular, low cost product had a major impact on existing products that offered similar function.

The products also had a societal impact.

Direct Business ModelDirect Business Model

Dell was a pioneer and has become the leader of the customer-direct, build-to-order computer systems business.

Its financial success stems from developing and implementing strategies designed to maximize the strengths of the direct business model.

Virtual IntegrationVirtual Integration

Interweaving distinct businesses so that partners

are treated as if they are inside the company.

(A major emphasis on outsourcing non-core

business processes)

Dell Business StrategiesDell Business Strategies

1. Speed to market.2. Superior customer service.3. A fierce commitment to producing consistently high quality products.4. Custom-made computer products that provide the highest performance and the latest relevant technology to customers.5. Early and effective exploitation of the Internet.

Benefits of the Direct Business ModelBenefits of the Direct Business Model

This business model provides the following competitive advantages.

1. It bypasses computer dealers and avoids related price markups.

2. It enables Dell to build each system to a specific customer order, which eliminates inventories of finished goods to resellers and enables it to move faster to new technologies and lower-cost components.

3. It provides direct contact with thousands of customers every day to tailor support offerings to fit customer target markets and to control the consistency of customer service around the world.

4. Leveraging its relationships with key technology partners enables Dell to rapidly incorporate the most relevant new technologies into its products.

5. The low inventory and low fixed-asset model results in the highest returns on invested capital in the computer industry.

What About Financial What About Financial Performance?Performance?

Dell has consistently led the computer industry in performance against all three major priorities: growth, profitability and liquidity.

Competitors won’t just give all the Competitors won’t just give all the PC business to Dell!PC business to Dell!

Most of Dell’s competitors are trying to emulate characteristics of how Dell operates its PC business.

It is fairly safe to conclude that the HP-Compaq merger was motivated by an intent to challenge Dell.

IBM stopped selling through retail channels and has sold its manufacturing of PCs.

Dell and the InternetDell and the InternetIf you sat back and said, let’s design a technology that could radically impact this company in positive ways.

It would be hard to create one better than the Internet. It essentially puts us that much closer to our customers. It is the ultimate form of direct for us. Because we were already dealing directly with our customers, it was a natural extension for us. We didn’t have to change the way we do business in order to do business on the Internet. Everything was already in place. A nice plus is that the Internet lowers the cost of doing business for us and our customers and it speeds transactions whether you are talking about sales, support or customers getting information.

Michael Dell

Dell Premier Web PagesDell Premier Web PagesA tailored web page for major customers that contains:

• Purchasing procedures

• Approved computer configurations

• Negotiated prices

• Purchase authority limits

• Order history and discount levels

This cuts order time, helps decrease order errors, keeps track of shipment status and has a record of all Dell units by serial number.

Product DevelopmentProduct Development

Dell employs over 2,000 engineers who focus on providing leading-edge products.

Intel E-CommerceIntel E-Commerce

Intel went from zero to $1 billion per month in six months.

The close connection to Intel's business strategy gives the IT organization constant feedback on how the products impact Intel's ability to deliver in the marketplace.

“It was a combination of really smart people, disciplined management, a strong team ethic, the ability to apply resources where needed and a culture that lets people switch gears rapidly.”

Doug Busch, IT Vice President

B2B Time LineB2B Time Line

Challenge from Senior Vice President of Sales in early 1998 to take in $1 Billion in sales orders via the Web in Q4 1998.

They took the first order in July 1998.

Arrived at $1 Billion per month by the start of Q4 1998.

B2B Readiness B2B Readiness

1. Business Strategy

2. B2B Infrastructure

3. Business Processes

4. Application Development

B2B

B2C

C2C

Secondary ReadinessSecondary Readiness

1. B2B External Initiative

2. Trading Partners

3. Solution Provider

4. Legal

5. Security

6. Audit

Need for StandardsNeed for StandardsThey knew that they needed standards.

Did not want standards that would take years to develop.

Standards needed a sound, extendable architecture; would have to be adopted rapidly; and would be demanded by management and supported by business and technology stakeholders in Intel’s business environment.

Helped found Rosettanet—a self supporting organization to develop and support B2B standards.

Links with SuppliersLinks with SuppliersBefore Intel could satisfy its customers' just-in-time demands, it needed to make its own production capacity responsive to demand fluctuations and tighten links to its suppliers.

It assessed the strength of its supply chain at the product development level by analyzing each supplier's ability to provide requisite quality and quantities of materials and equipment.

The company's ongoing effort to innovate often means signing on emerging companies with breakthrough products. Reliance on such youthful suppliers can present logistical challenges: "What if a company is used to making 1,000 widgets but we need a million when we go into production?"

Links with SuppliersLinks with SuppliersTo help its suppliers develop products in harmony with Intel's production needs, the company installed new Web-based tools that allow suppliers to study product drawings and specifications as Intel engineers draft them.

Intel also uses the Web to post policies and guidelines for companies seeking the certificates of compliance that Intel issues to eligible suppliers.

By providing information and forms over the Web, Intel automated most aspects of the formerly paper-intensive certification process.

Links with SuppliersLinks with Suppliers

Intel is in the enviable position of being able to require its suppliers to hold inventory until it's needed on the factory floor.

Intel works to balance its own inventory reduction goals with its suppliers' business needs.

Some suppliers initially balk at holding inventory for Intel, the chip maker helps ease their risk by showing them how to improve their own inventory- and demand-forecasting methods.

IS SupportIS SupportYou're only as good as your supply chain.

That commitment to efficiency also extends to the company's IS practices. Because Intel modifies its product line at least every 18 months, manufacturing plants and the IT that supports them must be nimble.

Intel has instituted a "copy exactly" strategy for systems that support 18 manufacturing, testing and assembly sites on three continents.

Identical architecture and applications support ordering and production planning at every site.

Helping Customers Anticipate Helping Customers Anticipate Market Needs Market Needs

Intel's customers, for the most part PC makers number in the thousands.

Because they assemble their finished products from many components with limited shelf life, OEMs assume the highest risk associated with inventory obsolescence.

Customer Order ConfirmationCustomer Order Confirmation

The improvements Intel has made to its supply chain are paying off.

The company used to require at least 24 hours to confirm orders through an overnight batch system.

Today, Intel is able to confirm delivery dates as orders are placed.

E-Business (IOS) Check ListE-Business (IOS) Check List

1 REENGINEER YOUR COMPANYThe Internet lets you communicate instantly with every supplier, partner, and customer--and, in many cases, lets them communicate with each other.

2 THINK BEYOND THE BOUNDARIES OF THE OLD BUSINESS MODELAsk a very basic question: Just who are you in the Internet Age? As you face more global competition online and have to cut your prices, doesn’t it make sense to reexamine yourold business model?

3 REALIZE THAT THE BUYER ALWAYS WINSUnderstand that the buyer runs the show on the Net. Up to now, buyers faced big obstacles to getting the best prices and service--limited time and data to compare vendors' products and the cost of dealing with far-flung suppliers. No more. The anytime-anywhere Net knocks down those barriers.

4 HOLD YOUR CUSTOMER'S HANDRoll out the red carpet--or whatever the cyber-equivalent is. You can use some nifty software package that analyzes purchases and suggests other things the customer might buy. That kind of software helps sell more to customers at little extra cost and treats them as individuals. It is called Customer Relationship Management.

5. OUTSOURCE NON-CORE BUSINESS JOBSThe instant communications power of the Net shatters the physical-world need to do product development, manufacturing, distribution, marketing, and customermanagement all in-house. There are lots of specialists that can do everything from hosting our Web site to running warehouses.

6. NO WEB SITE IS A DESOLATE ISLANDIn going online, an established brand name and purchasing power can work to a company’s advantage.

7. CREATE AN ONLINE SENSE OF COMMUNITYThink global. People all over the world are congregatinginto virtual communities on the Web.

8. FOLLOW THE MONEYThe name of the game in the business world is to make a profit.

9. A WEB OF NERDS? DON'T BELIEVE IT There are 510 million people online worldwide.

10. GET EXECUTIVES LOGGED ON Only 25% of CEOs in a recent Price Waterhouse Coopers survey regularly log on to the Internet. It really helps to get your fingers on a keyboard every day. This is something you can't delegate.