Despite lip service paid to the idea that employees are a company’s greatest asset, too often they are sacrificed in the name of cutting costs and boosting efficiency. But that does not have to be the case. Intensive research by Boston Consulting Group’s Morten Hansen and Michael Deimler reveals that the Internet technology that brought us B2B and B2C is now bringing us B2E: business-to-employee management. By cultivating employees the way it cultivates customers, a company can develop a more satisfied, more productive work force, achieve greater productivity, cut costs and beat its competitors.

Throughout 2001, headlines have announced job cuts in a number of major corporations: AOL Time Warner, Lucent Technologies, Verizon, DaimlerChrysler and Sara Lee, to name a few. Although the economic downturn has not yet been on the order of magnitude of the early 1980s, indicators point to a substantial slowdown in a variety of sectors. [...]

At a recent e-business research meeting, I was asked the following questions: “Five years from now, what will be happening with the Internet, and what breakthrough research projects in e-business will have contributed to the changes?”
My (intentionally provocative) answer was: “Lots of good things will happen, butnone of them will be enabled by research breakthroughs.” [...]

Many collaborative innovation strategies fail, say the authors, because all too often companies choose them without first considering what life-cycle stage their technology is in — and which type of partnership is suited best to that stage. The authors describe four phases in the life cycle of a technology, and detail how, in each phase, the decision to ally or acquire depends not only on company-specific competencies and needs, but also on overall market development and the company’s position relative to its competitors.

In trying to bring about e-business transformation, companies have paid too much attention to technology. To help company leaders see the bigger picture, the authors developed a research-backed model of e-business value creation based on eight e-business drivers — from mastering supplier-related processes to optimizing IT applications aimed at customers — that lead to operational excellence and improved financial performance.

During the 1980s, Benetton was known as the archetypal network organization. But it decided to take a new direction representing a major discontinuity with its past and a divergence from industry practices. Without giving up the strongest aspects of its networked model, it integrated and centralized, exerting greater control over its supply chain even as it diversified its operations and product lines. The authors offer a detailed case study of this dramatic transformation.

How do you compete with opponents that have size, strength and history on their side? The authors use Palm Computing (later Palm Inc.) to illustrate how the core principles of judo strategy — movement, balance and leverage. The offer lessons and specific techniques that other companies can emulate in order to compete successfully with a stronger player.

The authors surveyed 24 companies engaged in e-commerce in the United States and United Kingdom and found that IT perceptions and practices are evolving rapidly. Short-term, rolling plans are replacing long-term strategies. A new-venture outlook is widespread. Uniform technology platforms are ceding place to three-tier architecture. Multidisciplinary teams are replacing project management. Of those practices, the first two address the need for faster development; the second two, address the tensions between technological excellence and business value.

In an attempt to offer custom products, many companies lose sight of the customer. They wind up forecasting demand incorrectly, missing potential sales or winding up with excess inventory. Attempts to offset this by optimizing pieces of the value chain can backfire by degrading other parts of the chain. The authors say the solution is a truly customer-centric, build-to-order strategy, in which managers systematically improve the value chain’s flexibility in three areas: process, product and volume.

You are on a crowded elevator standing next to a couple of executives from a company with offices on the floor just above yours. They are talking in low tones about a surprise announcement coming the next day. Their firm, AGA Software, is being sold to a big, famous technology company! “My options are going [...]