Management
Issue No. 4 - February/March 2002
Is clustering the e-business answer for SMEs?
by Paula Capaldo
Small to medium enterprises (SMEs) stand to gain enormous advantage from the electronic business revolution. Despite the reported benefits of the Internet in terms of increased market share, strengthened customer loyalty and procurement efficiency, many businesses fail to realise the significant advantages a sophisticated ecommerce strategy can bring.
E-business is not the sole domain of the large corporates and multinationals. The sooner small to medium businesses understand that they too can unlock the advantages e-business has brought to the “big end” of town, the faster they can grab a piece of the action.
The changing business environment brought about by the Internet revolution means small business faces enormous challenges. Although many have taken advantage of online procurement or boosted sales via a web presence, others still see e-business as too expensive or view it as solely an IT issue.
The business environment will undergo further transformation over the next five to 10 years as increasing globalisation, IT and communication advances, competition and tougher demand for value by customers and consumers takes shape. SMEs need to plan for and adapt to these challenges, not allow themselves to take a reactive stance. Adapting is about re-engineering the way you do business.
Re-engineering is about embracing e-business and technology to develop new markets, increase competitiveness, reduce costs, maintain customer loyalty and ultimately add value and profitability to a business.
It is clear that many SMEs find it difficult to understand that they can adopt an e-business strategy that will add to the business but remain cost effective. While a great deal of money can be spent on sophisticated IT systems, e-business—particularly IT systems—does not have to be adopted wholesale. It can be implemented with flexibility. By examining options and choosing carefully which aspects to implement immediatel...
