The e-business transformation Managing for Value in an Internet Economy.

Strategic planning. Everyone does it, right? Perhaps, but strategic management tactics in today's swiftly changing economy bear little resemblance to the planning strategies of even a year ago. The internet has changed everything.

Companies are seeking new ways to interact with customers and suppliers, reach new markets, communicate, share knowledge and, ultimately, create value. Thanks to the internet, both the speed and intensity of change and competition are increasing exponentially.

To survive and thrive in the new economy, companies must make the transition to e-business, which alters the very core of how companies manage growth and plan the future. Successful e-businesses are developing a deep, real-time understanding of both internal processes and external dynamics of the marketplace and the competition on a monthly, weekly, even daily, basis.

IPALCO Enterprises, a multistate energy company whose primary subsidiary is Indianapolis Power & Light Co. (IPL), is a key example. "We need to be able to understand and measure our critical business processes in order to be able to improve service," says Steve Plunkett, IPALCO's controller. "Businesses are really just a collection of processes. The problem is that traditional accounting systems do not capture costs in that way. We need to be able to connect our costs to our processes if we are really to be in a position to improve."

Ask a group of CFOs to identify their greatest information needs and you're likely to hear a variation on IPALCO's theme: managing enterprise operating costs and measuring customer and product profitability. "The need for nimble strategic planning and agile management is not new," says Oracle CFO Jeff Henley. "Raw data exists in most organizations to inform more sophisticated decision making, and bold new techniques have arisen in the science of organizational management. What's been missing is the enabling technology, and that's where the internet comes into play. Companies that harness its power will emerge as leaders in this new, sophisticated business environment."

To get at real costs and unit profitability, IPALCO turned to Oracle's internet-enabled Strategic Enterprise Management (SEM) suite of applications. The Oracle SEM suite includes Activity Based Management, Balanced Scorecard, Strategy Formulation and Value Based Management. Each component is designed to work separately or in tandem with other components to help managers drive customer and product profitability, link strategic planning to execution, set corporate goals and objectives, and focus on increasing shareholder value.

Activity based...