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VIRTUAL IDEAS
How e-Laggards' Roadmap

Chafing at the fact that the e-commerce extension of your brick-and-mortar business isn't showing the spectacular sales that the guys over at Amazon.com seem to be notching up effortlessly? Hang in there. It took Amazon.com 3 years-and it could take you 4, predicts the GartnerGroup (www.gartner.com).

In its model-based forecast of how long it takes traditional companies to succeed in the Netspace, titled The e-Business Hype Cycle, Gartner argues that all Net ventures will go through a trough of disappointment as expected returns do not materialise. This, the Hype Cycle predicts, will happen in 2001. The reason? Not because the e-move is wrong, but because companies fail to get their business models and implementation-logistics right. It is only by 2004 that the companies will realise how to transact e-business successfully.

What does this mean for you? Refine your e-strategy, learn from the e-biz models of companies that fail, be clear about what you expect e-biz to do for your company, acquire the requisite skills, and don't think of brick-and-mortar and the cyberstore as mutually-exclusive entities. The future, according to Gartner, belongs to brick-and-click firms. Bottomline: watch, but touch very carefully.

-R. Sukumar

The Channel Conflict

They certainly won't like it. The efforts of a company to use the Net to reach its customers directly is not likely to find favour with channel intermediaries who traditionally served as the company's link with its customers. Managers have to learn to manage channel conflict if they want their companies to invest in EC (E-commerce) solutions that will generate a significant volume of sales in the future. And at the same time, not lose the bulk of existing revenues that come through channel intermediaries.

Research conducted by Marcos A. Peralta, an associate at AT Kearney's Chicago office, indicates that the chances of a channel conflict are high when EC channels-replace external channels (like distributors) rather than internal ones (like a sales team); target existing customers instead of new customers; and sell existing products instead of new products. Companies can tackle this problem in two ways, posits Peralta.

One, they can implement an effective Opportunity Management System that rewards intermediaries on the basis of demand-generation tasks, not just transactions. Two, they can use the EC channel to build brand-awareness and facilitate off-line transactions, ensure that the terms to customers match those to dealers, or sell through the EC channel but still compensate channel intermediaries. Right now, it pays to keep everyone happy.

-R. Sukumar

Team Management

You can't see them, but you still have to get them all to work together towards a common objective. Just what does it takes to manage a virtual team whose members aren't in the same location, and may not even work for your company? HBS researcher Charles Wardell describes the 8 keys of virtual management. Plug in.

-R. Sukumar

THE EIGHT-FOLD PATH

Learn to manage a conventional team first.
Formulate a clear vision for the team.
Assume nothing, and spell out everything.
Don't communicate; megacommunicate.
Forge alliances with your team members.
Base incentives around milestones.
Watch for conflict, and learn to manage it.
do post-mortems to improve performance.

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