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Consider
how IT & eBusiness developments are changing your marketplace
We’ve already indicated the importance of having a clear
vision of your business in the future before you invest in technology
to deliver that vision. However, given the rate of technological change,
when you do envisage the future of the business, you need to take
into consideration the impact of IT on your market. How will your
competitors and customers embrace new technologies? Will the dynamic
of the marketplace change completely?
 As
the VLM example demonstrates, sometimes new technologies give you
the opportunity to follow a new type of strategy. So your vision needs
to be informed with a view of how customers, suppliers and competitors
are likely to embrace technology over time. For example, Kingspan,
an Irish supplier to the construction industry, achieved a 15 point
increase in marketshare by moving ahead of competitors through the
implementation of their eBusiness programme. Both Kingspan and their
customers, the structural steel contractors, have benefited from the
eBusiness project as follows: more competitive lead times and more
accurate order processing. Obviously, the market share gain has been
realised at the expense of competitors, who have been slower to embrace
new technologies.
When formulating their business strategy, these competitors need to
consider how best to respond to the market changes caused by Kingspan’s
eBusiness project.
In some cases, it’s the customer who drives change. Lake Communications,
a supplier of voice and data networking products and software technology
had this experience. British Telecom (BT), their most prestigious
customer which accounted for over 30% of business, requested tighter
controls over the supply chain process. This demand became the driving
force in initiating Lake’s eBusiness project. The subsequent
roll-out of the project has guaranteed future business with BT.
So taking these two examples, Kingspan and Lake, there can only be
one decision: invest in technology or be left behind. It’s not
easy but it is clear. As with everything in business you need to embrace
change or fall away!
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