By Anjani Kumar

The Net changes everything.To successfully conduct business in this millennium, companies will have to re-think and redefine their existing strategies and perceptions, and the rules they have used to run their businesses. The Net will fundamentally alter customer-expectations in terms of convenience, speed, price, and service.

In 5 years, all companies will be Net companies, or they won't be companies at all. e-Commerce will be central to any company's strategy, and a majority of revenues will accrue from selling on-line. The business model driving companies in this millennium will be the 4C Model: Content, Communication, Community, and Commerce.

The networked market is broadly divided into 2 categories: Business-to-Business (B2B) and Business-to-Consumer (B2C). Of these, the B2B segment-which, according to one estimate, will generate $1 trillion worth of revenues by 2002-holds greater promise for a country like India where abysmally-low PC penetration, even lower Net access, and poor infrastructure render the rapid development of B2C difficult. B2B will be the primary growth-driver over the next 2-3 years.

In B2B transactions, e-businesses will have to re-think the value chain, accelerate the business processes, re-organise the workflow, create transparent markets, re-define boundaries, and alter the basis of competition. The new paradigms which will govern businesses are:

COMPETING ON TIME. Conducting business 24 hours a day, 7 days a week is no longer a competitive advantage. It is now an imperative for doing business. A presence on the Web allows companies to be accessible to their customers any time of the day or night at the click of a button.

GEOGRAPHY IS HISTORY. The lack of geographic limitations for e-commerce re-defines what boundaries are, and how they are perceived by practising managers. Although companies might be local, they will have a global reach thanks to logistic service-providers, and will need to tailor their products to the global marketplace. Products successful in one market can quickly be sold worldwide.

On the cost front, businesses can tap resources in distant locations, and perform functions wherever the most skilled and the least expensive talent resides rather than where their offices or management happen to be located. They can outsource parts of their operations to better or less-expensive service-providers. The Net makes it cheaper to communicate between enterprises and outsource activities than to develop or maintain them in-house. e-Commerce is accelerating the unbundling of business systems.

TRANSPARENT MARKETS. e-Commerce will create transparent and highly-competitive markets where differentiation will be the key to survival. Buyers will have perfect information on the prices, features, and cost structures of products. Sellers will no longer be able to take advantage of the information-gap. Companies will have to communicate how they differ from their competitors, and will survive only if they successfully create value for their customers.

MASS CUSTOMISATION. The Net is every marketer's dream-come-true. It is the first and only communications channel that enables cost-effective, one-to-one marketing on a large scale. The use of Web-technology enables marketing of unprecedented exactitude at the lowest-possible cost. Not only can marketers be sure of their target audience, they can also gauge the response to their products and get immediate feedback. A caveat: the marketing model, though, is changing; it is being transformed from push to pull, where customers have to be enticed into placing an order with the company. Thus, the millennial marketing model will turn to responsiveness.

RETHINKING THE ROI. As Intel's CEO, Andy Grove, says: ''We are conquering a new world where traditional financial parameters are of little significance. What was Columbus' return on investment?'' The statement underscores the fact that finance managers will soon have to re-define how they evaluate their return on investment in technology, especially on Net-related initiatives. An associated dilemma for analysts and stock-brokers will be the e-valuation of the e-corps: Amazon, e-bay, and Priceline have yet to declare profits; yet, their stock-prices continue to skyrocket. Parameters like Price-to-Earnings and Earnings Per Share are no longer predictors of future prices. Managers need to find innovative measures to value dot.com companies based on figures such as the number of hits, or page-views per month, or the number of subscribers.

KILLER APPS WILL CONTINUE TO KILL. Large and established players can no longer remain complacent in the knowledge and satisfaction of owning huge brick-and-mortar businesses. From now on, small and agile companies will be able to beat large and sluggish ones. All it will take to challenge and de-throne an established player will be an innovative idea backed by an implementable business model.

e-Commerce is here to stay, a fact recognised not only by the captains of the industry, but also the cradle of managers in the country, namely, the B-schools. However, what these budding managers need to keep in mind is the fact that success in the Indian marketplace lies not in blindly copying Western business-models, but in coming up with innovative solutions.The benefits of the rapid growth and expansion of the Net in India will, in the initial years, accrue to the Internet Service-Providers and the established bricks-and-mortar companies rather than pure Web companies.

An important issue hampering the growth of Net-companies is the dearth of venture capitalists. All said and done, one needs to have a proven track-record to even hope to receive start-up money for a Web concern. The conceivers of naukri.com, and indiaparenting.com were established professionals in their own right before they decided to take the plunge and form an e-company. Such individual ability could well be what will count.

Anjani Kumar is a second-year MBA student at the Faculty of Management Studies, Delhi

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