Since the early 1990s, executives have been told repeatedly that business issues, not technology; should guide transformation -- and that's still true in the age of the Internet. But even though transformation is not driven by technology; "a lot of it is powered by technology," says Lorrie Scardino, a research director at the Stamford, Gonn.-based Gartner research firm.
Technology is, of course, a key enabler of the e-business revolution, and an integral ingredient in competitiveness. Faced with that reality, companies are working hard to keep up with ever-evolving systems. But they're also being more careful about how they spend their money. Like all areas of the corporation, IT budgets are under increased scrutiny. And so, as they support the transition to e-business, executives are making sure that IT investments are based on a sound business case.
As they consider where to invest, executives should lift their gaze beyond the Web, says Hollis Bischoff, director of electronic business transformation at the META Group research firm, also in Stamford, Gonn. "Business is transforming through the use of electronic means. But don't get caught up on that being just the Internet," she says. As e-business moves deeper into business, it involves a broad range of technologies, from databases and servers to wireless devices and broadband networks. "What we're really talking about is institutionalizing processes and using technology to do that," says Bischoff.
Indeed, rather than look for any single new technology, companies should focus on building a solid foundation, or e-business infrastructure. "You need an infrastructure that unifies the people and processes across the company;' says John Carrow, 010 of Unisys Corp. "You need consistent, timely and easy-to-use information across the organization, and you also need to give customers and suppliers access to that information, whenever and wherever they need it. Having an infrastructure that lets you do those things is a prerequisite for e-business."
According to the META Group, that kind of infrastructure is still far off for many companies. "Most organizations are unprepared to support e-business from an operational perspective;' Bruce Allen, an IT operations expert at the META Group, recently explained. "Companies can spend millions of dollars on cutting-edge technology applications, but if they don't have the infrastructure and operational processes in place to support them, it's a total waste of money."
As one might expect, e-business requires some new thinking about systems and processes. In a world where change is endemic, companies need to create "adaptive infrastructures" that can accommodate new technologies, processes and business models with relative ease. "The architecture has to be very flexible so that it can respond quickly," says Scardino. "That way, if you decide to go with an application for a certain business problem, you are not going to be stuck with that for the next five years. And that approach is a big change for a lot of technology departments."
There are a number of fundamental principles to guide companies as they create adaptive infrastructures starting with "integration, integration, integration," says Bischoff. "Integration internally, and integration externally with your partners -- because collaboration and integration are really what e-business is all about."
"You have to 'integrate backward' - tie...