Under Analysis: The tide is coming in

The E-Commerce tide is starting to come in. Indeed some organisations have already noted a significant change in the way they reach out to their customers or to their suppliersMany organisations report considerable success and are pleasantly surprised in their ability to complete transactions which were initiated across the Web. We have been subject to early indications of the new business channel which is emerging and have long been wooed by many vendors and solution providers, each offering a point solution or what have been deemed to be key components to help us transact E-business.

Early trials confirm the opportunity

Many early experiments have been completed or are well underway, to the delight of some and the disappointment of others. IDC's research indicates that the market in Australia for business which was initiated on the Web grew from $110 million in 1997 to $673 million in 1998. This is but the start of the incoming tide. In 1999 IDC expects E-Business in Australia to reach $1,700 million and continue to increase to $14.6 billion by 2003.

As this column goes to print IDC is completing a new series of studies which will verify the breadth of organisations which have or are planning to introduce E-Business capability. The early indications confirm the forecasts will comfortably be fulfilled.

The impact will be observed in many markets, some are obvious, others will emerge as businesses gain experience and break out of the traditional ways of doing business. Already we have examples in Australia of organisations which have been able to reach buyers far removed from the geographic limitations they previously faced.

Geographic barriers overcome

The removal of geographic barriers, however, is a two-edged sword, organisations from outside can reach into one's customer base and penetrate accounts they could never adequately service. Already we have noted some change in the flow of goods as users find they are able to access a far wider range of goods and services than has been available on their local market. This will become more apparent as time goes on and additional organisations devise ways to use the Web to boost their existing business or to establish new business opportunities.

As the E-Business tide comes in there will be little time to react as the pace of change is likely to overwhelm those who continue to do business in traditional ways ignoring the change which is upon us. The challenge for organisations throughout Australia is to quickly assimilate the lessons which can be learned from the early experiments and trials and adapt their business model to the new environment.

Graham Penn is general manager of research for IDC Australia

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