12. How to Use the Site
Most visit our site for free scraps of information, which we're happy to provide, but suspect they'll only promote a false sense of confidence. Contrary to perceived wisdom, eBusiness needs a top-down approach, and only a few percent of startups do in fact succeed. Many of the larger, popular and well-funded Internet companies had a hard time at first, as our case studies document.
Certainly we're not saying ebusiness is impossible for the smaller company. If you have exclusive rights to a product people really want, then selling over the Internet is a doddle. There are a few pitfalls to avoid which we go into and some planning needed to make best use of what's available which again we provide, very fully but the technicalities are far, far easier than they were ten years ago when we started our work.
Most Internet companies do not lack for competition, however, and so need sound strategies, an understanding of the technologies now available, and the lead-time and capital to take advantage of those technologies all of which we cover.
For most people, therefore, ebusiness is difficult. All the bases have to be covered, including technical matters. Given the many avenues possible, we're suggesting a business consultant approach: looking at the big picture, knowing how comparable enterprises are succeeding, identifying any weaknesses in the present plan, and fixing them.
Companies in fact adopt certain models and strategies, which time has shown to be successful. There's no escaping them. Sail blithely on, and you'll be pouring time and money into plans that simply won't work.
A few of these models and strategies we'll glance at in fictional situations that follow. You'll see what's involved, and how this site can help you in outline, of course, one of many possibilities, kept as simple as possible.
Example One: Improving eCommerce
You're the first business study graduate the law firm has hired, and they start you off on their website. It has the usual photos and write-ups of partners, but hasn't brought in much business, as far as they can tell. You have to fix that.
You study the website, and note:
1. It looks like any other law firm website, with photos and staff qualifications, professional but also impersonal and unfriendly.
2. It's 'company orientated' rather than 'customer-orientated' i.e. stresses the firm's skills rather than what the firm can do for its clients.
You talk briefly with partners and spend time with Accounts, but don't make much progress. Their business plan is simply 'find more prestigious clients and charge higher fees' i.e. has no proper breakdown by market segment, deployment of resources, profit margins, return on investment, market trends, competitor activity, etc. Unfortunately, your questions seem only to annoy the senior staff. One says very plainly, 'Look, young lady, we employed you to help us, not the other way round.' You are required to make a presentation in one month's time, and your job is clearly on the line.
You do the obvious:
1. Examine other legal websites, drawing up a short list of improvements.
2. Consider Facebook and other social networks.
3. Get web design companies to cost the improvements and give you mockups of the 'new look'.
Your presentation goes smoothly, and partners seem satisfied. There'll be little interruption to business activities, and the costs are reasonable.
Now you drop your bombshell, and say these improvements will make very little difference. You've been hired for your business skills, not as a web designer, and indeed the website can only build on and further the business plan, which you haven't so far got from them. While they are glaring at you, you flash on to the screen various charts that show:
1. The immediate competition: similar law firms with figures for staff numbers, turnover and specializations. How do we compare?
2. Results of some business studies you've looked at, which show trends and profitabilities in the legal field. Where are we?
3. Different business approaches, stressing the effectiveness of the 'outside in' model. Ours is the opposite.
4. Some case histories, including that of Bancorp. What do we learn from them?
In short, you are proposing, with their help, to investigate the:
1. Firm: who does what, with what result: costs, ROI in time and money, individual views.
2. Future: what areas are becoming more important and why.
3. Marketing: how these are best presented through the website.
When someone remarks, 'I see you've become our new manager', you smile and say that, on the contrary, you are giving them the information and analyses to make the right decisions. Your job is to harness the knowledge and expertise that comes from actually being in the business, to analyze that material, and present your work on a regular basis so they can decide what's needed next. In monthly meetings you will present findings to date, and outline the business options open to them.
'What has this got to do with the website?' someone else wants to know. 'Everything' is your answer. If the firm's business is lost-cost divorce settlement, the website will be personal and friendly, stressing their successes in reaching amicable arrangements with a minimum of expensive counsel. If the firm's business is large company copyright infringement, the site will look quite different, and feature successful settlements and sums involved. A minimalist site probably, with legal jargon to match, since the audience will be fellow lawyers.
Then, you say, the firm can consider how to better market its services, through articles, conference talks, pay-per-click search engines, press releases, social networks, etc. Moreover, you add, the website can be used to interact with visitors more, and find out what they really want. A website is not a menu, but a means of securing more of the right sort of business. If they will help you, you will try to make them the best in their line of business.
Example Two: Landscape Gardening Services
Officially, you're retired. You sold your New England landscape gardening business a few years back, when the collapse of the real estate market made it hardly worth continuing, but are now being asked for advice by your Florida neighbors. Advice, of course, not a service where you do the work and they pay. Your neighbors are quite happy to potter along making small improvements themselves year by year, but they would welcome direction, some overall plan that covered such essentials as soil, drainage, trees, plants, lawns, paths and swimming pool. What should be done each year, at what sort of cost, and how can they do most of the work themselves?
Not much of an opening there, you think, and plan to spend more time on the golf course. But you do have a lot of knowledge that is now going to waste, and some extra money would help. So you think of a website with gardening tips that also offers your services. You didn't need a website before as work came from personal recommendations, but you've heard that sites are essential today, simple to set up, and not at all costly. You do some Internet searches.
Best seems a hosting company who charge a few dollars a month, and throw in a free online website build service. Nothing could be easier, and a week later you're the proud owner of a domain and gardening tips site, to which you devote several hours a day to writing helpful advice. And it is good advice: you know the business and can quote likely costs. What happens? Very little. No one emails you with offers of work, and indeed your traffic monitored through the hosting company's site statistics is well, pretty awful: in single figures a day.
Time for more work. An Internet search finds a local web design company, and you go to see them. They're charm itself, and point out that hosting company websites are not too distinctive, or easy to promote. You really need something better, which they can supply at competitive prices, and even maintain for you. Send your tips by email, and they'll do the rest, even adding attractive photos to the site. You mention their prices to your wife, who whistles. But you have to be serious in business, you remind her, and you can't make money without spending it first.
Your new website is dazzling, and you can't stop admiring it. The only trouble is that traffic is still low, and no work comes from it. You phone the web design company. SEO, they tell you, search engine optimization, for which they'll give you some recommended companies to contact. Now the costs involved make even you whistle.
While you're digesting this news, your wife's niece arrives for the weekend: some high-flying marketing executive, with whom you reluctantly discuss your ideas. She's not encouraging, and indeed fires off all kinds of tiresome questions: What's your unique selling proposition? Why do you want a website when an email service might be sufficient? Need feedback? Better consider a blog or content management system. What does keyword research say: have you checked you can beat the competition? Are you funneling visitors properly? What conversion rates are you expecting? Have you considered the pay-per-click search engines?' . . .'Hell', you say in desperation, 'I'm just trying to provide a local service, to help fellow gardeners and make some pocket money.'
'Then why don't you go round and see what local people actually want?' she says. 'Jump in the car and we'll do a brief survey of the surrounding district.' Most gardens are OK-ish, a few excellent, and many that need a total makeover. Accompanied by your marketing hotshot, you call on the owners of the better gardens and ask them if they'd be interested in appearing on a website featuring 'top gardens' of the area. There would be several photos, something about the owners, and any tips they might have. Most are only too happy on learning that there would be no charge for featuring. You emphasize you're not selling anything.
Next, your pushy niece in attendance, you visit garden supply centers with a brief list of your credentials and ask if they offer trade discounts. You explain your plan, which is two years into the future, and secure agreements in principle.
So appears your new website, in a Facebook format, using one of the commercial programs cheaply available. There's a visitor response section, which you edit and to which add suggestions of your own, all positive and helpful. Ads in the local paper is all you need for marketing, and your 'top gardens' site accumulates over a hundred entries in its first year, with many more gardeners trying to get in. You're courteous to everyone, of course, and go round to all applicants, explaining how they could improve their chances. A few ask for professional services. You explain your credentials, and without committing yourself ('my wife wants me to give up work') you explore what would best suit them, possibly:
1. Membership of a local gardener's club for a token fee: advice can be exchanged and members help each other.
2. Premium membership, where you professionally helped them and obtained trade discounts on large orders.
3. No club, but you helped them on a one-to-one basis, either for a small yearly fee, and/or you pocket the trade discounts of orders they place through you.
4. No club, but a total makeover service, similar to your New England business.
Options 3 and 4 gave clients inclusion in your 'top gardens' site, of course, and an opportunity to market your services further.
What's best? You don't know. But by being up front with everyone, and genuinely trying to find out, you are laying the foundations of a proper business. Your niece has outlined what we provide: the focus on a sound plan, and a proper evaluation of your opportunities in implementing it.
Example Three: Consultancy in Environmental Studies
One day, swapping disaster stories with colleagues, you realize that many companies still get planning wrong. Well into its construction phase, the new industrial plant suddenly runs into a brick wall. The national government turns hostile. Local authorities discover problems with environmental impact studies. Residents are up in arms. What's happened? the company wonders angrily as work is halted, a public inquiry is called for, and loan repayment becomes a nightmare.
A lot of things, very often. You make a list:
1. No continuing liaison at top government level.
2. No attempt to fit the project into the long-term aspirations of the country concerned.
3. Regulations regarded as a nuisance, something to be satisfied as quickly as possible.
4. Environmental studies conducted by junior staff, who are 'not at liberty' to discuss what they're doing, leaving locals wary and/or suspicious.
5. Interested parties government officials, professional bodies, local businesses, academics, residents, etc. kept out of the loop and simply 'told what they need to know'.
6. Media relationships are grudging and not proactive.
Anyone familiar with the business will be able to cover several pages with what later were obvious, but had been overlooked at the time.
Could you set up a consulting company to make good these shortfalls?
Possibly, but not easily. Environmental studies are part of project feasibility studies, and the market is competitive and specialized. Mining companies don't stray into oil refinery construction, for example, and large projects require the backing of a world-class name if loans are to be forthcoming. You could set up a website advertising your helpful skills, but the business generated would be nil.
But you think about it, and see you need to establish:
A. Size of market: today and for the next ten years or so.
B. Competition: who's doing what, and how well.
C. Team requirements: specializations, experience and availability of key personnel.
D. Unique selling proposition what exactly are you offering, and how is it better than the competition?
We'll pass over A and B for the moment: and assume the findings are positive or, being in the business, you'll know anyway, though you'll have to check everything carefully shortly. Step C you can't answer until you've looked carefully at D. What's your killer proposition, against the competition?
HOW YOU COMPARE
Part of project feasibility
Hired as needed,
Project manager's role
'Selling' project to
By now you should be thoroughly discouraged. Why would you want to found your own company anyway, when contracts always go the big boys?
Well, possibly, just possibly, there's an opening for an outfit that did all the above in a thoroughly reliable and professional manner a total package that worked in with the project manager, government, locals: everyone. No more engineers 'wasting their time' with press conferences, or PR types standing there clueless when asked a technical question. Where the team leader can pick up the phone and speak immediately to the minister concerned. Where local concerns are properly addressed from day one. Where there's sufficient experience for second opinions to be given on any aspect of the project, ensuring that nothing's been overlooked and cost overruns are kept to a minimum. A competent honest broker, in short.
What does a SWOT analysis make of that?
1. Experience of individual staff.
2. Reputation of individual staff in their respective specializations.
3. Business and government contacts.
1. Concept is untested: do companies really want an honest broker?
2. Prospective company has no reputation or trademark.
3. Difficulty in recruiting 'top of their field' staff.
1. Natural resource developments in Africa and Latin America, often by the Japanese and Chinese.
2. Internet as a connecting and enabling medium.
2. Deepening recession may lead to project cutbacks.
All these require extensive research and thought like our country profiles, but more so. But let's concentrate on weakness 2: you're not a household name in the industry. How is that modeled by Porter's five forces?
Supplier power is moderate (your reputable consultants like the concept but don't necessarily want to leave the safe job they have now).
Entry barriers are currently high: no one else offers such a range of skills: this will change rapidly if you're successful.
Substitution threat is low: no other concept would represent a 'complete package'.
Buyer power is high: you'll be at the beck and call of clients until you're clearly the best and can afford to be choosy.
It's a mixed picture, with the buyer power being the main problem. How could you reduce this?
1. Work in the roughest/most dangerous parts of the world, where others won't.
2. Target companies and/ethnic groups that are not yet big players: east Asian, possibly Latin American companies.
3. Specialize: concentrate on specific industries or needs.
Suppose you identify Chinese companies as your potential clients: what areas of the world are they interested in? Most places, but above all Africa. Europe is in recession. For Latin America they (and you) will have to speak fluent Spanish and/or Portuguese. Africa needs development, and government loans may be available. The lingua franca is largely English, moreover, which many university-trained Chinese will speak to an acceptable level. What's next? You'll:
1. Extend our page on China, noting that the country has a big future.
2. Complete steps A to D above.
Then, supposing you still have a viable concept:
3. Purchase and study reports on Chinese investment: where, what projects, countries, guiding principles. An Internet search will quickly locate them.
4. Employ a consultant (preferably Chinese) who can open doors for you.
Now, some six months down the road, and lighter by some tens of thousands of dollars, you can decide, either to:
Go it alone: put a team together and visit Chinese companies,
Form a partnership with a Chinese company,
Interest one of the consulting companies you currently work for.
Common sense suggests a Chinese partnership, because:
1. The Chinese are anxious to acquire western 'know-how'.
2. The Chinese government exerts some control on overseas projects, so you'll need a good line to them.
3. You're going to use the Internet extensively (see below), and that will have to be Chinese in part.
4. Nuances of necessary approach and conduct are invisible to westerners: you'll need a reputable Chinese company to keep you from blundering badly.
5. You share their reputation / trademark, overcoming a major SWOT weakness.
You'll also need a careful partnership agreement, so that you're not sidelined once your Chinese partners have acquired your expertise. An equitable, win-win situation needs to be fostered.
So far you've used the Internet to:
1. Undertake steps A to D, probably accessing commercial (pay-to-view) databases.
2. Undertake a detailed SWOT study of China and Chinese overseas developments.
3. Find detailed assessments of the Chinese market
4. Secure a Chinese consultant.
5. Identify Chinese construction companies for possible partnerships.
Now you have to:
1. Ensure your company fits one of the Internet revenue models.
2. Study relevant case histories to anticipate difficulties and firm up your financial data.
3. Describe in detail how you'll handle environmental concerns better than others by:
a. keeping channels of communication open at all levels: regular meetings and consultations with all interested parties.
b. maintaining a Facebook presence so everyone knows how the project is progressing.
c. employing a management content system or advanced blogging system where feedback is encouraged and developed.
d. supplying Internet access to locals if none is yet available (satellite disks, laptops and power).
e. using private industrial networks or industrial consortia in the construction and operating phases.
4. Build a website that sells your skills to potential partners.
5. Use Facebook to present friendly introductions to your team: previous colleagues will contribute, and you'll respond quickly to any queries received.
6. Ensure your LinkedIn entries are modestly compelling and up to date.
7. Conduct an email campaign aimed at securing partners but also soliciting contributions from other interested parties: government departments, professional bodies and academics.
You're aiming at a showcase example: how environmental matters should really be handled. Certainly this costs money, but it's a drop in the ocean compared the financial penalties of having a project suspended or derailed. In fact, simply following central government directives and imposing a mine or reservoir on local inhabitants is usually a sure recipe for continuing trouble, as the Chinese have found in overseas projects. Everyone expects to be consulted and difficult though that is with political agendas, displaced residents, industrial secrecy, etc. some acceptable compromise worked out.
Yours is a business-to-business model, and B2B markets are:
1. Ten times the size of B2C markets.
2. Less subject to consumer vagaries and recessions.
3. Promoted quite differently from services in B2C markets.
What type of Internet revenue model? Because you're facilitating communication between groups, a private industrial network is probably the closest model.
Our site tells you more about B2B systems, how they are promoted, and the essentials of private industrial networks.
You'll need to look at case studies so as to:
1. Discover what technologies are used in practice.
2. Anticipate problems.
3. Obtain realistic figure for costs and time to implementation.
4. Be alerted to model refinements.
You'll need to examine a wide range of companies before you've fully assessed your environmental studies consultancy, but these may start you off:
9.10 Andhra Pradesh: bringing technology to the third world.
9.17 Early Dotcom Failures: avoiding marketing overspends.
9.26 Liquidation: establishing a sterling reputation.
9.30 Nespresso and 9.33 Open Table: time scales and marketing approaches.
9.31 Netscape: need for sound business model. Where the funding coming from while you build your business 'second opinion service' to investment banks, perhaps?
Take Home Points
1. For most companies, the Internet is an enabling medium that has to be worked at. It is not a magic wand that makes everything easy.
2. Planning is essential. With our material you can quickly build models, cost them, and fix any weak points.
3. Implementation is greatly facilitated by knowing the full range of technologies available, allowing you to focus immediately on the most relevant and start putting figures to strategies.
4. To these needs to be added an understanding of long-term trends, increasingly international in nature.
Internet references are provided to corroborate, supplement and illustrate the text. Some 2.5% are to Wikipedia, which, for all its faults, often provides the only readily accessible source to technical matters. All information on the Internet is inherently suspect, but Wikipedia is now generally reliable for matters that have no contentious commercial, social or political dimension.
Given the number of Internet links it is inevitable that a few sites listed will be down at any one time. Individuals, companies and institutions also change their site contents and layouts without warning (or even redirects), but an Internet search for the title of a discontinued article will often find alternative sources.
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