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Editorial: 'Business As Usual' Doesn't Deliver

By Len Monheit

With several important issues facing the industry, recent editorials have had an inward focus. The danger in operating exclusively with an internal focus is the risk of losing perspective on larger issues, global issues, and even general business issues.

The issue of using technology to support business processes has been a mainstream topic in most sectors. How has this affected our industry?

This industry, with its fragmentation, and with many small to mid-size organizations has been an extremely slow technology adopter compared to other sectors.

This conservative and wait and see approach is different from industries where technology is more part of the operation, or where relationship selling is not as significant. More mature industries typically embrace technology more willingly, and often are willing to work collaboratively with other industry stakeholders. In the natural products and nutrition sector, there is (often justified) mistrust and ulterior motives in many interactions.

The rise and subsequent fall of business to business sites and exchanges has not provided industry companies with confidence in the potential value of technology to support business growth.

No less than eight companies arrived on the scene between 1999 and 2001 touting technology based solutions and platforms which would change the way business operated in our sector. Fundamentally, business hasn’t changed; although some of the platforms have added value and strengthened relationships. The auction / exchange platform on a broad basis was not embraced by high quality suppliers who feared their products would become even more commoditized in an auction environment. Some manufacturers have been successful in hosting on-line RFQ management and solicitation systems with the goal of lowering raw material costs.

Often overlooked in the touting of these business to business platforms was a value gain for all stakeholders. The companies that have survived (and there are a few), realized this early on and have reformatted their offering so that there is clear and measurable value for platform users.

With so many internal issues and challenges facing industry executives, dealing with the present has been the priority, and technology investment with questionable deliverables has certainly not been at the forefront.

From an operational management sense, this approach is logical, but crisis management is a difficult cycle to escape. From a strategic management sense, the lack of awareness is dangerous, and if it hasn’t already hurt industry companies, it will in the mid to long term as new companies form, and companies on the outside eye industry opportunities despite these difficult economic times. These are organizations which either have or will invest in technology to support operational efficiency, communications or customer management.

They have discovered that it is quite possible to achieve competitive advantage and operational benefit with limited investment and reasonable commitment. :

  • It’s time for corporate websites to not be only on-line brochures, but also interactive platforms with existing and new clients. If you are not building a community with your site and communications, you are extremely vulnerable to your competition.
  • The only time high profile company leaders interact with a client base or community should not be at speaking engagements and tradeshows. With statistics showing that directed, topical business news is read by industry professionals, this is an excellent vehicle to reach an interested audience. If you have the volume and initiative, develop an electronic communications strategy. If you don’t, look for complementary organizations, and build something together.
  • From press releases to job postings, if you’re not using technology, the Internet, creativity and a proactive approach, you’re not doing everything you can to gain an upper hand in a competitive environment.
  • If you don’t have a corporate strategy for information management (contacts, correspondence, quotations, proposals, agreements and more), in these days of information overload, you’re not operating efficiently and you’re missing an opportunity for productivity gains that could add several margin points to your operation.

The solution will not be the same for each company, nor will the value equation. But you owe it to your company and to your employees to investigate the possibilities. As with many things in business, the question is not, “How can I afford it?” It’s really, “How can I afford not to.”

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