Although time to market is vital in creating a successful new e-business - bringing advantages to early movers - the ability to execute cannot be underestimated.
Benefits for early movers include reduced branding efforts and costs, and better positioning for partnerships and alliances in the marketplace.
"However, it is vital that you execute," says Daniel Currie, vice president of Global Sales Support, Commerce One, Inc., which provides blue chip solutions for e-Business. Currie was speaking at the inaugural SAPPHIRE South Africa 2000 conference, held in Midrand earlier this month and hosted by inter-enterprise software player SAP Africa.
Commerce One and SAP are partners in the e-commerce world, combining Commerce One's leading e-marketplace infrastructure with e-procurement, supply chain, product planning and analysis applications from SAP. Commerce One South Africa - Distributor Operations recently launched the local MarketSite Africa, the region's first local trading hub that links buyers and sellers in the region to the Global Trading Web.
"Although you must get your product out quickly, remember a bad name is almost impossible to overcome, so don't sacrifice quality for speed otherwise later movers will benefit.
"There's a fine balance between time to market and execution," says Currie.
He says to enter the B2B world, companies must leverage their core business but realise they are entering a totally new business.
"You must build a proper business plan detailing strategies, goals, objectives, funding and organisation. It's also vital to move at Internet speed, making decisions dynamically as you go," he says. "This, however, must be balanced with sticking to your business plan."
Currie says companies must keep the supply base informed, begin building the solution, talent and project team immediately, and sustain market presence.
"You must opt for early success," he said. "You can do this by going for a phased implementation, and leveraging new ways of doing business, such as auctions. You can be up and running in a couple of weeks with auctions, thereby offering services immediately.
"Never alienate your suppliers, especially if you are focusing on a vertical industry," he advised. "Always keep them informed and solicit their feedback. You should work with the supplier base upfront, and set realistic expectations for supplier adoption.
"Remember that you're offering a lot of benefits to suppliers including: a new global sales channel; increasing revenues from current customers; lower transactional costs and fewer errors and less re-work. It is important to stress the value to them, and make them enthusiastic."
"Goals should be aggressive but realistic, and should support rapid but controlled growth," says Currie. "Expand products slowly, and don't expand too fast geographically. Learn from past experiences and inspire confidence."
Companies should maintain an eye to the future, on the customer and on the competition. They should anticipate the future, and be flexible enough to adapt the business model if necessary. They need to understand opportunities and be prepared to scale accordingly.
'Also vital is to recognise exactly what customers want," says Currie. "This is especially key early on when setting up new e-business.
To stay competitive, concentrate on creating competitive advantage, creating barriers to entry, differentiating yourself or creating synergy, and creating brand awareness.
Amazon.com started early, focused initially only on books but now offers much more and has invested in good delivery systems. Charles Schwab is an excellent example of really staying in touch with its customer base. It has always anticipated its customer needs.
Peapod, an online grocer, on the other hand, was too slow to understand the efficiencies of owning warehouses, and did not adapt its business model.
Currie's examples are all US companies, where Internet adoption has been incredibly rapid, but he believes that looking at the US gives a vision for the future of Africa.
In the US today there are now mega-exchange sites where companies in a particular industry are getting together to trade.
"These mega sites bring ease of use and are totally interactive," says Currie. "No barriers to entry combined with 24x7x365 and robustness, make them successful."
Commerce One is partnering with a number of companies to create recurring revenue structures.
"We provide a flexible, open platform for e-business, and are involved in mega exchanges in the automotive, aerospace, energy, utility, telecom and energy, metals and mining industries, including several partnering with SAP.
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