Internet integration key to e-success

Companies hoping to reap the rewards of joining the ebusiness marketplace need to refocus their business strategies to incorporate the internet rather than simply setting up an internet-only division.

According to speakers at Gartner's Ebusiness and Internet Conference in Paris, too many businesses feel they need to adopt an 'either/or' approach to online activity and are losing out on the benefits of combining both.

"Ecommerce is more than just a dotcom," said Bob Duthe, chief executive at online broker Charles Schwab Europe.

"The internet is great but is still in its infancy. A successful company will offer the best of the web and the best of the physical world. Customers need more than just a virtual outpost in cyberspace," he added.

Despite predicting that Charles Schwab will have more than nine million internet customers in the UK by 2003, and will do more than 60 per cent of its business online, Duthe said having a physical presence is a factor which gives it a competitive advantage over internet-only rivals.

The internet is great for investing and trading, but is only a part of the overall business model, said Duthe. "Customers like to have a physical and human face and that is why we have more than 340 branches as well as our online service," he said.

Gartner analysts at the conference also issued a stark warning to European businesses that they run the risk of falling further behind the US in the ebusiness space if they don't make changes to their current business models.

European companies will need to refocus their competitive strategies of ebusiness or will lag nine to 12 months behind the US, said Gartner analyst Alexander Drobik.

European companies are too focused on implementing tactical applications such as e-procurement, and although this is important, Drobik said companies need to focus on making their businesses more flexible by 'net-liberating' their organisations.

To achieve net-liberation, he said, companies need to join forces with business partners who can operate non-core functions more efficiently and cost-effectively.

For the rest of the year, the number one priority for chief executives should be to net-liberate their organisations by implementing e-marketplace strategies and putting the new business model in place, he said.