ECW7
Office Futures
ECW7
Issue 7, January 10, 2000+++Lessons from the mail order business
+++A suggested reading list
+++Lessons from the mail order business
++Exploiting infrastructure
While ordering goods by messenger no doubt dates from ancient times, mail-order selling as we know it today began in the USA just over a century ago. Two companies led the way: Montgomery Ward, established in Chicago in 1872, and Sears Roebuck (begun as A.C. Roebuck & Company in Minneapolis in 1891 but also going to Chicago shortly after).
These and companies like them exploited the spread of the railways and the resulting cheapness of the US postal and parcel delivery services to sell a wide range of goods to distant farmers and rural communities. Sears Roebuck's catalogue for fall 1900, for instance, contained over 100,000 illustrations, was over 1,0000 pages long and weighed 4 pounds.
Despite being a century old, the catalogue, or 'Consumers Guide', is surprisingly modern in its outlook and language. Here is an extract, which sounds like the kind of thing a 'one-to-one' marketer would say today:
We shall always aim to make the ordering of goods from us pleasant as well as profitable to the customer. Our army of employees are instructed to handle every order and letter with care, in fact, to treat every customer at a distance, just as they would like to be treated were they in the customer's place and the customer in theirs.
Also, the explanations of the company's policy and practices are not dissimilar to the requirements of online behaviour monitors such as TRUSTe. The preamble to the catalogue contains details of pricing policy, corporate status and financial guarantees, terms, how to order, how to pay, the various delivery methods and how to return goods. It finishes with a reproduction of a completed order form, to show what information went where.
Sears even ran a savings bank for customers, accepting deposits of between $5 and $1,000 and paying a competitive rate of interest.
++Exploiting newer infrastructure
The increase in car ownership and the building of more and better roads during the first half of the 20th century meant a new transport infrastructure in the USA. Good roads, plentiful cars and cheap petrol meant the end of the railroad's supremacy. Personal shopping gradually began to replace mail order.
The emergence of chains of food-stores like Piggly Wiggly made the shopping trip attractive, and quicker. Shopping malls made that trip an all-in-one event. Sears Roebuck, for instance, spotted the trend and, in the 1920s, began building a chain of department stores. (What today would probably be called a 'papyrus and mortar' strategy.)
Personal shopping now dominates American retailing. Even Jeff Bezos of Amazon.com, America's most successful Web retailer, recognizes this1: 'To bet that people won't go into stores is to bet against human nature, which is always a bad bet. We are a gregarious species.'
Although only a remnant of its former self, the consumer mail order business in the USA still accounted for $52.3 billion in trade in 1998. This is tiny compared with the total of US retail sales that year -- $2,566 billion -- but still substantially more than the latest pretender to the distant shopping throne, consumer e-commerce. This registered just $8.0 billion; enough to make some companies rich but only just above noise level in the wider context2.
America is not even the leader in mail order any longer. The largest mail-order company in the world is the German-based Otto Versand GmbH. ('Versand' is German for 'dispatch'.) This had a turnover of 32.9 billion Deutschmarks ($17.0 billion) in its 1998/99 trading year, and net profits of 511 million Deutschmarks ($264 million). Of its sales, about 7.6 billion Deutschmarks ($3.9 billion) were from retail. It operates in 19 countries, including the USA. There it owns the Spiegel and Eddie Bauer concerns, which had a total turnover of around $5.4 billion, including shops.
++Fulfilment
In 1900, the Sears Roebuck operation was speedy enough for its catalogue to suggest that customers allow just one or two days for their order to be filled. (This was in addition to the time needed for the order to arrive and the goods to travel to the customer.) A century later, Lands' End, a clothing supplier, makes this boast on its web site: 'We ship faster than anyone we know of. We ship items in stock the day after we receive the order.'
This is laudable but not much of an improvement in 100 years. Also, Lands' End must be referring only to its American competitors in making that assertion. Otto Versand can supply most of its German customers within 24 hours of receipt of their order. Like many catalogue companies, it uses its own delivery company for this.
The need for the physical movement of goods is clearly a limiting factor. There are now Web-based stores, such as Samedaymall and Urbanfetch, that offer round-the-clock, every day delivery of what they sell, but these operate only in confined localities. Distant deliveries are pretty much as time consuming as before.
Again, this takes us no further forward than was possible over a century ago. In effect, these operations have simply substituted HTTP for the note or telephone call to the grocer.
The fact that these online stores stay open continuously is a commercial decision, nothing to do with the Web. There are, for example, over 18,000 7-Eleven neighbourhood stores all around the world that stay open twenty-four hours a day3. They do so without recourse to the 'Net.
Where operations like Samedaymall and Urbanfetch are distinctive is that they offer both remote access and round-the-clock opening. A catalogue operation offer the former; a convenience store offers the latter. These Web-based stores have merged the two. It remains to be seen whether the demand they are catering is specialized or whether, as the 24-hour society becomes more prevalent, this way of operating will become the norm.
++Exploiting electronic infrastructure
Of the Otto group's turnover, some 100 million Deutschmarks ($51.6 million) arose from electronic commerce. Despite being small by comparison with its traditional business, this was three times greater than in 1997/98. Its chief executive, Michael Otto, feels that the company is well placed for further growth in this channel.
It will still, of course, have to move products by road, rail or air but the information-handling aspects of the business will be quicker. Trading conditions will change, too. The World Wide Web lives up to its name, with, for example, over 40 per cent of American Web traffic coming from overseas4.
The same is true of consumer purchasing on the Web, but not yet to the same extent. Even so, it is already far more international than with mail-order catalogues. Like all Web retailers, the Otto companies will have to adjust to cross-border purchasing and the implications that will bring in terms of legal obligations and risks.
++Sears on-line
Moving into online purchasing is not a new action for a mail-order retailers. In 1988, Sears Roebuck partnered IBM in setting up the Prodigy public videotex system. This became the third-largest online service in the USA but made little profit5. Prodigy underwent a management buy-out in early 1996 and is now a middle-ranking ISP, with 1.2 million subscribers at October 1999.
Sears is on the Web these days. Its site provides a restricted range of articles and makes at best a single-figure contribution to overall sales. This is comparable to that from its paper catalogues, which nowadays account for just 8 per cent of the company's general merchandise sales. There are over seventeen of these catalogues, some specialized and others for general goods. Sears seems to have rediscovered its interest in its 'Big Book' catalogue after abandoning it in 1993.
The company's CEO, Arthur Martinez, is confident that e-commerce will grow quickly and is quoted as saying he expects it to be twice the size of the catalogue business by 20106. If that came about, a quarter of Sears' business would then be coming through direct channels, something of a return to the old pattern.
Martinez is realistic about the fact that Web shopping will detract from in-store sales but sees it as inescapable. In the Context interview he says: 'To be successful in retailing over the long haul, you have to have an active presence in all the important channels -– be it big stores, little stores, catalogs, or e-commerce.'
He sees Web kiosks as a useful weapon. Martinez feels that by letting customers research products, including competitive ones, in the store, they are more likely to buy in that store than when at home. 'If they do their research here with us, we have a chance of holding them and making the sale in the store.' This is sales psychology at work, of course, rather than using the Web for cost reduction or for its infrastructural advantages.
Despite all the changes in its fortunes, long-term and recent, Sears Roebuck is still a very large organization. In its trading year ending 1 February 1999, Sears Roebuck's turnover was $41.3 billion and its profits exceeded $1.0 billion. It has around 3,000 stores in the USA and Canada, specialized and 'full-line'.
Home repair and servicing is another important activity for Sears, particularly through its Sears Direct marketing operation. This began only in 1998 and exploits the Sears database of 100 million customer records with telesales, catalogues, mail-outs and the Web. Sears employs 14,000 home servicing technicians. Banking continues, too, with the Sears Card having 30 million active users.
Arthur Martinez wants that strength manifested on the Web and is in no mood to wait for it to happen. As he sees it, time is not on Sears' side. 'I see an enormous rush to fulfill our promise of being the definitive on-line source for the homeowner... You can't write three-year financial plans. You can't write five-year strategic plans. You have to try to move with the speed of the market, which is moving far faster than any traditional organization has ever moved.'
++Lands' End
Another of Martinez's plans, to let customers communicate on-line with Sears' service organization, is already in operation but on the Lands' End Web site. This is a newer company, established in 1963, originally to sell sailing clothes and accessories. It sells only direct and, these days, concentrates on leisure and formal clothing for the managerial class.
Lands' End has been on the Internet since 1995 and currently also has Web sites in Britain, Germany (administered from Britain) and Japan. In 1998, it introduced a way of letting customers build a three-dimensional model of themselves through their browsers. That feature is no longer evident on its Web site, either because of technical problems or a lack of interest by consumers.
Despite a technically able set of customers -- 'twice as likely as the rest of the population to live in an online household', says its Web site -- this program seems to have stepped over the dividing line between feature and gimmick. Another American clothes retailer, The Gap, tried something similar at about the same time. That feature has disappeared, too.
What Lands' End is now doing is emphasizing communicability with human beings rather than pieces of code. With a feature on all its Web sites called Lands' End Live, a customer or enquirer can use the company's Web site to request a telephone call from a sales advisor while still browsing the site. (The enquirer needs to have a telephone line free, of course). As the British version of the printed flyer puts it, this puts 'a real, live person right there with you, however you prefer' -- the kind of offer normally found only on premium-rate chat lines. Alternatively, the shopper can engage in text chat with an advisor.
Another new element on all the Lands' End sites is the 'Shop with a Friend' feature, the icon for which is visible just to the right of the chat box in the diagram. This lets two people browse the Web site together. Both can place items in the shopping basket but only the first caller at the site can pay for them at the checkout. The two shoppers will need to be in communication by telephone or instant messaging while this is taking place.
In its 1999 fiscal year, Lands' End did $61 million in Internet business, roughly 4.5 per cent of its overall sales. The year before, Web sales totalled $18 million, just over 1 per cent. In the company's 1999 annual report, its Chief Executive, David Dyer, set out what he sees as necessary for long-term success at e-commerce: 'a recognized brand name, proprietary product with sufficient margin to make a profit, and database and distribution infrastructure'. Naturally, he feels that Lands' End is well-supplied with all three.
Of all the annual reports examined for this article, that for Lands' End has been the clearest in describing the opportunities, and threats, of electronic commerce. It is probably no coincidence that it is also the one that reveals the most clearly articulated ambitions for success on the Web.
One of the objectives Dyer has set out is reducing the cost of handling paper catalogues. Despite having almost its entire product range available via the Web, the company sent out 259 million catalogues in 1998/9, 12 per cent more than over the year before. Creating, printing and mailing them absorbed 40 per cent of Lands' End's operating costs that year.
With pre-tax profits of $49.5 million out of a turnover of $1.37 billion, cost-cutting would seem an urgent necessity but Lands' End is actually doing better than many of its competitors. Single figure profitability seems usual in this sector.
++L.L.Bean
The L.L.Bean [sic] company was set up in Maine in 1912 and began by selling a waterproof hunting shoe by mail order. Initial problems with this led to an piece of company policy that remains today, a no-quibble lifetime guarantee on products. Like Sears Roebuck, L.L.Bean went out of its way to make the mail-order customer feel as though he were in personal contact with the company.
In an early example of logistics integration, the company's founder, Leon Bean, put his manufacturing plant above the local post office. Outgoing packages simply slid down a chute to be despatched.
The company opened its first American retail shop in 1952, in the manufacturing plant. This was open 24-hours a day, catering to the hunting and fishing enthusiasts who were and are its major customers. The shop moved some years later and was subsequently joined by a children's shop nearby, some 'factory outlets' and some shops in Japan.
Only a minority of its products are made by L.L.Bean these days. Despite buying more than half its resold products domestically, it trades with more than sixty countries for the remainder.
The guarantee remains, though, as does the attitude to customer service. The following 'golden rule' of Leon Bean's can be found on its Web site, 'Sell good merchandise at a reasonable profit, treat your customers like human beings, and they will always come back for more'. A visit to the company Web site shows that his philosophy is still in operation, with copious advice on outdoor recreation and invitations to attend demonstrations and courses on those pastimes.
This deliberate folksiness conceals a sophisticated and efficient operation. L.L.Bean now issues fifty specialized catalogues, aimed at selected customers. Its call-centres have used calling-line identification for years, but without revealing it until recently.
The original factory has been replaced and team-based manufacture is used in the new factory. According to company literature, a team can now finish a product (a pair of boots, presumably) in three days instead of the 'conventional' fifteen.
Annual turnover stands at just over $1 billion and estimated net profit at $25 million. The estimate, from Forbes magazine, is necessary because the company is still family-owned. Like 7-Eleven, it has opened shops in Japan.
++Avon
At the other end of the machismo scale from L.L.Bean is Avon Products. Famous for its army of 'Avon Ladies' on doorsteps, the company is the world's largest direct seller of cosmetics.
This also is a long-established company, having been set up in 1886 by a book salesman, David McConnell, as the California Perfume Company. From the start McConnell employed women to peddle its products door-to-door, primarily in rural areas and small towns. He renamed the company 'Avon' in 1939, apparently after the 'peaceful purity' of Stratford-on-Avon in England.
Avon has had a money-back guarantee from its earliest days, too, and has gained a reputation for customer care. In its trading year ending 31 December 1998, it turned over $5.2 billion and made net profits of £270 million.
Avon sells in 135 countries, through 2.8 million independent sales representatives, nearly 450,000 of whom are in the USA. These are almost all commission-earning part-timers, who create 98 per cent of the company's business. The remainder of Avon's business comes from fifty or so shops in the USA and several thousand overseas.
Avon's representatives deliver the company catalogue ('brochure') to individual customers and prospects at their home or place of work. They do so every two weeks, as part of the company's cycle of sales campaigns. Avon prints and sends out over 600 million of these brochures a year, in more than 12 languages.
When a representative takes an order, she forwards it to a distribution centre. There, the order is collated and then delivered to the rep's home. She delivers the goods to the customer and collects payment on her own account, remitting the net cost to Avon with the next order, and so on.
The company's overseas growth and profitability outstrip those of its domestic business. 70 per cent of Avon's brochures are distributed in the USA, where only 40 per cent of its business arises. It is therefore planning an extensive advertising campaign for spring 2000, along with the relaunch of its Web site in June.
The revamp of the site is expected to cost over $30 million in capital and expenses, including software from DWL Inc. This company has done similar work for large insurance companies and for Revlon International and The Body Shop International, both of them Avon's competitors.
Once complete, the new Web site will allow American shoppers the ability to buy from Avon's full product line, as well as offering products not available through its other channels. It will also let sales representatives sell online through their own personalized Web pages, order products, check account status and make payments online. Avon is arranging for them to be able to get discounts on computers and Internet access.
Avon's district managers, who are company employees, each typically responsible for 300 representatives, will get access to sales, marketing, product and financial data, and online training.
According to a Wall Street Journal article7, Avon has estimated that processing an order over the Web instead of by paper saves it between $1 and $3. World-wide, the company processes 650 million orders a year.
The prospect of savings of this order is enticing but it would come at a cost higher than $30 million. Most mail-order and retail companies face the scavenging of their established business by electronic commerce. For Avon, wholesale adoption of e-commerce threatens to do away with its first-level sales force, who are also its order-taking force, its final delivery force and its cashiers.
This obviously is a perturbing prospect for the company and representatives alike. Even if it were of a mind to, Avon could not jettison these people overnight, not without grievous damage to its reputation and carefully maintained feminist image.
In the same WSJ article, Avon's chief executive, Andrea Jung, is quoted as 'having pledged' that 95 per cent of sales will be through representatives for the next three years. The article does not make clear how that will be achieved, not does the company.
Some fudging of figures will be needed for that to be possible. One does not need to spend $30 million dollars for a direct sales throughput of, say, $300 million a year (5 per cent of $5.2 billion, rounded up). Conversely, a site that expensive would be expected to bring in much more than that sum.
Perhaps some form of local crediting of direct sales will be involved during the interregnum, according to the 'territory' of the representative from which each online sale originates. While keeping the 'Ladies' content, this could lead to demarcation difficulties, and possibly some inter-state tax complications.
++Emerging patterns
At this stage of the evolution of electronic commerce, most mail-order companies' Web sites are little more than electronic simulacra of their paper catalogues. Their main difference is that they are usually more up to date, which benefits the shopper, and can be re-priced more quickly, benefiting the trader8.
Even then, few retailers are making their entire 'paper' product range available via the Web. Whether this is through tentativeness or technical constraint is not clear but it will ultimately be expected of them.
Retailers may argue that this means a risk of scavenging their own business. This is unarguable, and inescapable, but it is not all loss. For instance, three-quarters of Lands' End's online trade is estimated to come from former catalogue customers9. In the long run this means that the company will be in a position to save money in printing and distributing its catalogue. Order processing will be cheaper, too, as Avon has discovered.
Meanwhile, this means that a quarter of the Web business coming to Lands' End is new business. Whether it is cheaper got that way than by paper and whether it will stay is impossible to say. But one can bet that the company is glad to have it.
The possibilities inherent in giving customers a cheap and easy means to interact at a distance with a company's database of product and service offerings have yet to be revealed, let alone fully exploited. There are some clues in the response to the advent of television shopping channels, such QVC and Home Shopping Network, in the 1980s. At the time, they, combined with increasing paper and shipping costs, were seen as a real threat to the mail-order business.
QVC, now part of Comcast, set a record in 1986 for first-year sales by a start-up. Within 7 years it had become the premier televised shopping service. It now has 18 million people in its customer files, out of around 100 million homes reached in USA, Canada, the United Kingdom and Germany. QVC's 1998 sales were $2.4 billion.
In 1996, QVC opened its Web site, iQVC. It offers 80,000 items for sale, 30,000 of which are not found on the TV channel10. Some scavenging is taking place, by the look of it, but QVC appears unworried.
The QVC Web site has now reached annual sales of nearly $100 million, not yet at the level the TV service attained in its first year. One might suspect that this suggests poor implementation but an April 1999 survey by Harris Interactive11 shows that customers give the site top rating in several product sectors. Either customers are not as hungry for interactivity as they were a decade before, or else the contrast between television and the Web is not as great as between either of those channels and paper. The latter seems the more likely of the two possibilities.
This also brings out the point that, in considering e-commerce, it need not be limited to the World Wide Web. The QVC example shows that the coexistence of different 'new' media channels is possible, as well as mixing new and old media.
To an extent, this already happens, in that all the mail-order companies have 'industrial strength' telephone and fax systems, typically free or cheap for customers to use. It is easy to forget that the 800 number (0800 in Britain) that everyone takes for granted these days was an innovation in the 1980s.
Many mail-order companies used this to gain an advantage. Like all technical advances, its contribution faded once the competition started using it. Today it is just a basic part of the capabilities required to operate in the mail-order market.
Web-based commerce will follow a similar sequence. Simply having a Web site displaying corporate information -- 'brochureware' -- is these days passé to the extent of being seen as a sign of incompetence. Selling on the Web is no longer a differentiator, either. Turning the Web into a strategic tool is today's task.
Turning one's Web site into a differentiator is another matter. Technology alone will not achieve that. In the same way as the 0800 number is now commonplace, any new Web feature or capability will be copied by its first adopters' rivals. One has only to ask how much relative advantage over Avon Revlon has enjoyed in using DWL's software and for how long.
This is not to criticize any of these companies' attempts so far. Not only do they have to create new ways of shopping, they have to get people to adopt them. The attractiveness of Lands' End's communications options, for instance, has yet to be determined. All the same, this company seems to be working harder than some others mentioned at blending the essentially static nature of catalogue shopping with the interactivity of personal shopping.
The final point is that, at the moment, Web-based operation alone is unlikely to be possible, economically sensible or even desirable for most existing retailers. Someone like Sears does not sell off its stores in the hope of growing its Web site's present single-figure contribution into 100 per cent or more. Likewise, Avon does not disband its army of representatives just to minimise its order processing expenses. As Sears Roebuck's Arthur Martinez points out, multiple channels are the likely best way forward. Even QVC has shops.
If nothing else, having multiple channels permits multiple use of existing resources. In both mail-order and Web operations, companies must ship products directly to consumers, create customer-service call centres and build customer and product databases. Companies already in the mail-order (or the TV shopping) business therefore start with an advantage. Bolting the Web on to those capabilities, so to speak, is easier and cheaper than starting from scratch or buying them in.
Also, some companies would retain paper even if they could dispose of it without harm, at least for the present, simply for its value as a marketing tool. Victoria's Secret, the underwear retailer, sends out 400 million catalogues a year. Ken Weil, its vice president of new media says of this: 'Those 400 million catalogs are 400 million brand impressions'. Lands' End still used a magazine insert to publicize its new Web features in the UK.
++Conclusions
What will work best in any particular situation is impossible to define, of course, but there some obvious steps deducible both from some of the surveys mentioned already and from current mail-order practice. These include, in no special order:
- having first-rate customer service. This runs from making first contact easy and unthreatening all the way through to having a generous returns policy.
- having some form of 'no quibble' guarantee on products is a constant aspect among the successful mail-order companies. In almost every case these have been part of company policy from the company's inception.
- offering additional services of some kind to support the sale and to keep the customer coming back. Lands' End does hemming of garments, L.L.Bean teaches you how to fish, Sears mends your washing machine and so on. All these are chargeable. Customer loyalty does not depend on freebies.
- running an efficient fulfilment system, whether improving an existing one, building one from scratch or buying one.
- giving, and being seen to stick by, assurances on data privacy.
- making clear that online security is taken seriously. Customers' worries about this, whether justified or not, come up constantly in surveys.
- creating a feeling of community, even if it is contrived.
One might also bear in mind the results of a survey of 1,047 American catalogue shoppers published in May 1999, the magazine Catalog Age. 60 per cent of those questioned said they shop from catalogues mainly for convenience. The next two most frequent reasons were 'unique merchandise' and price.
Those same three reasons came out top when the subject was online shopping but in different sequences according to the age and sex of the respondents. The difficulty lies in deciding whether these will remain the salient factors in the next few years.
The Harris Interactive poll mentioned earlier contains some clues. It measures nineteen main parameters. Under 'customer satisfaction' it asks people their reactions to:
- site design
- product information
- product selection
- customer service
- price.
The poll also showed that, at the time, consumers are twice as likely to buy off-line as they are to do so from the Web. Converting those virtual window shoppers into customers is hard enough. Attending to the basics set out here at least stops it becoming unnecessarily hard.
++Notes
1. Interview in LA Times, 24 December 1999.
2. Source: eMarketer, 1999 eRetail Report.
3. This symbol of American retailing has in fact been under foreign control since 1991, when It-Yokada Co, a leading Japanese retailer, took a 51% stake in it.
4. From the CyberAtlas analysis, Foreign Web Traffic Increasing.
5. Videotex is technically inferior to the World Wide Web, which was in the ascendant by then, and the Prodigy service had commercial competition from CompuServe and America OnLine.
6. Interviewed in Context magazine, September/October 1999.
7. "Avon tries to exploit Internet without alienating its 'ladies'", Wall Street Journal, 28 December 1999.
8. There are also potential environmental benefits to Web-based catalogues. A report by the American group, Alliance for Environmental Innovation, says that more than 17 billion catalogues were mailed in the USA in 1998. This equates, it says, to 64 catalogues for every man, woman and child. The impact of manufacturing and disposing of the 3.35 million tons of paper involved is a cost borne by all.
9. Wall Street Journal, 18 October 1999.
10. "Just Another Medium", BusinessWeek Online, 27 September 1999.
11. Benjamin Black of Harris Interactive describes iQVC as "the poster child for how to transfer an offline audience to an online audience", which we think means he likes it. It also suggests a narrow definition of "online". BusinessWeek Online, ibid.
+++A suggested reading list
Here are some suggestions on books that you may find useful in examining the strategic aspects of electronic commerce. I have divided this list into three: books I strongly recommend, books that are useful to have to hand and those that provide helpful background. In most cases, the publishing details refer to British editions.
If you intend buying, rather than borrowing, any of these books, most online booksellers in English-speaking countries should have the recently published ones listed. Alternatively, try a bargain-finding service such as DealPilot. For second-hand and out-of-print books, try Bookfinder.
Several of the authors of the books listed here publish online newsletters from their own Web sites. These are usually free and are delivered to your email in-tray.
++Strongly recommended
1. Competing for the Future, Gary Hamel and C. K. Prahalad. Harvard Business School Press, 1996. ISBN 0875847161. One of the current standard texts on corporate strategy. A good, and short, presentation of recent thinking on, to coin a phrase, managing in turbulent times. Despite an update in 1996, makes no mention of the Internet or World Wide Web.
2. Digital Darwinism. Seven Breakthrough Strategies for Surviving in the Cutthroat Web Economy. Evan I. Schwartz. Penguin Books, 1999 (available in other editions). ISBN 0140286845. The over-the-top subtitle notwithstanding, a well thought-out and readable application of Charles Darwin's theory of evolution to business in the age of the World Wide Web. The result is a subtle, practical and valuable book.
3. The 24 Hour Society, Leon Kreitzman. Profile Books, 1999. ISBN 1861971885. A fascinating look at the disintegrating boundaries between work, social and personal life as the never-sleeping society begins to take shape. Explores the commercial possibilities in useful detail, with an emphasis on British activities.
4. The Internet: The Rough Guide 2000, Angus J. Kennedy. Rough Guides Ltd, 1999. ISBN 1858282888. Physically small, and cleverly packaged and priced, this is the ideal beginner's guide to the Internet. The first half tells you, in plain language, how to do it and what the jargon means; the second gives lots of suggestions on Web sites to visit. Is revised annually, so does not date much . . . and doesn't call you an idiot.
5. The Ropes to Skip and the Ropes to Know: Studies in Organizational Behavior, R. Richard Ritti. John Wiley & Sons, 1997. ISBN 0471133043. Provides vivid and memorable insight to organizational behaviour through a series of fictitious stories (a formula copied by Goldratt and others). Although based mainly on American manufacturing industry for its background, points out as clearly as anything more modern the reefs on which an e-business strategy might founder.
6. The Seven Cultures of Capitalism. Value Systems for Creating Wealth in the United States, Britain, Japan, Germany, France, Sweden and the Netherlands, by Charles Hampden-Turner and Fons Trompenaars. Judy Piatkus, 1994. ISBN 074991386X. Ignore the cumbersome title; this is an practical, entertaining and thought-provoking journey around the world's main industrial cultures. Combines the results of extensive surveys with historical sketches, case studies and anecdotes. Required reading if you take the 'World Wide' aspect of the Web seriously.
7. Up the Organization. How to stop the company stifling people and strangling profits, Robert Townsend. Coronet Books, 1970. ISBN 0340149868. Down to earth advice presented in a witty way by the man who resurrected Avis. It has dated only in some of the detail. Townsend has no time for flim-flammery or for activities, departments or ideas that don't earn their keep. Speaks more common sense on re-engineering – but before the word was invented – than any of his successors, and in far fewer words.
++Useful
1. 21st Century Money, Banking & Commerce, Thomas P. Vartanian, Robert H. Ledig and Lynn Bruneau. Fried, Frank, Harris, Shriver & Jacobson, 1998. ISBN 0966331737. A thoroughgoing review of electronic banking and financial services, and the effect on risk, legality, intellectual property, security and privacy. The definite text but large and expensive (no paperback version yet).
2. Customers.Com: How to Create a Profitable Business Strategy for the Internet and Beyond, Patricia B. Seybold with Ronni T. Marshak. Times Business (Random House), 1998. ISBN 081293037. A bit of a hooray for American Web businesses. The message about customer alignment is drummed in, accompanied by useful case studies, but the authors pass over the tougher aspects of making internal changes and winning over trading partners.
3. Doing business on the Internet, Simon Collin. Kogan Page, 1998. ISBN 0749427108. A helpful introduction to the technical side of electronic commerce. Covers the basics of Internet communication and also marketing, paying, delivering and security. Well illustrated, with some worked examples at the end.
4. E-Commerce: A Guide to the Law of Electronic Business, edited by Stephen York and Ken Chia. Butterworths, 1999. ISBN: 0406982635. A well-organized and practical guide to the subject as it applies in Britain. The editors and contributors are all practising solicitors, from the same firm, writing on their areas of specialization. Pricey at £95, but best around at the moment.
5. Enterprise One to One: Tools for Competing in the Interactive Age, Don Peppers and Martha Rogers. Currency (Doubleday), 1997. ISBN 0385482051. Every marketer manager should have this in his knapsack. Clearly and bracingly sets out what an organization needs to do to become truly interactive with its customers.
6. Enterprise.com: Market Leadership in the Information Age, Jeff Papows with David Moschella. Nicholas Brealey, 1999. ISBN 1857882075. Papows is the top man at Lotus, makers of the Notes groupware product. This bias shows through, to useful effect, in his coverage of knowledge and information management issues. The book is also more international in scope than any of the other American books listed here.
7. Global Transformations: Politics, Economics and Culture, David Held, Anthony G. McGrew, David Goldblatt and Jonathan Perraton. Stanford University Press, 1999. ISBN 0804736278. A thorough, sober examination of the political, economic and social effects of globalization. The authors look at the past, present and future within each of their main topic areas. Comprehensively researched and clearly presented, it's the nearest thing we have to a definitive study. An important text for planners and for those who want to go beyond the headlines.
8. How to Assess Your IT Investment. A Study of Methods and Practice, Barbara Farbey, Frank Land and David Targett. Butterworth Heinemann, 1993. ISBN 0750606541. A practical handbook, published in association with the magazine Management Today, The authors have covered most of the problems, including grasping the nettle of qualitative benefits, in succinct fashion.
9. Hyperwars: 11 Strategies for Survival and Profit in the Era of On-Line Business, Bruce Judson with Kate Kelly. HarperCollinsBusiness, 1999. ISBN 0002570947. Lives up to its title but is biased towards marketing issues, which it covers well. It's a shame its authors seem unaware of life outside the USA.
10. Images of Organization, Gareth Morgan. Sage Publications, 1986. ISBN 0803928319. A penetrating analysis of the prevailing mental models of organizations, giving the strengths and weakness of each. Finishes with a less convincing synthesis of the nine metaphors discussed but this scarcely detracts from the mind-opening material that precedes it.
11. Media Technology and Society: A History: From the Telegraph to the Internet, Brian Winston. Routledge, 1998. ISBN 041514230X. A broader and more scholarly look at the development of modern communication technologies than Standage's (see below). Covers telegraph, telephone, radio, television, computers, satellite communications and the Internet in fair detail but at a good pace. Winston argues that the present frenzy over the so-called Information Revolution overstates the effects of technical forces.
12. Rethinking the Future: Rethinking Business, Principles, Competition, Control & Complexity, Leadership, Markets and the World, edited by Rowan Gibson. Nicolas Brealey, 1998. ISBN 1857881087. Based on the established formula of gathering together contributions from big-name commentators and stitching them together with some editorial silk. Useful for dipping into.
13. Understanding Organizations, by Charles Handy. Penguin Books, 1992. ISBN 0140156038. A modern classic. Handy covers all the important topics in a balanced but shrewd fashion, with numerous examples in every chapter. The best general introduction to organizational matters available but could do with updating. A chapter on the effects of the Internet would be valuable.
++Helpful background
1. Accidental Empires; How the Boys of Silicon Valley Make Their Millions, Battle Foreign Competition and Still Can't Get a Date, Robert X. Cringely. Penguin Books, 1993 (updated version in hardback). ISBN 014017138X. An absorbing, funny and, as the sub-title suggests, largely disrespectful account of the rise of the personal computer industry. Cringely knows most the characters involved and tells you more about them than they probably would have wished.
2. Commodify Your Dissent: Salvos from the Baffler. The business of Culture in the New Gilded Age. Edited by Thomas Frank and Matt Weiland. W.W. Norton & Company, 1997. ISBN 0393316734. Penetrating and witty attacks on American consumerism and the intrusion of marketing attitudes into everyday life. Could leave you cold, fire you up or confirm your fears, depending on your predispositions.
3. Computer: A History of the Information Machine, Martin Campbell-Kelly and William Aspray. Basic Books, 1996. ISBN 0465029906. A scholarly narration of the development of computing, from pre-Babbage days to the growth of the World Wide Web. Its one fault is its over-emphasis on American activities, minimizing the mid-century contributions of British and German pioneers. (This is strange, given that Campbell-Kelly, a Briton, has written an excellent history of ICL.)
4. Computerization and Controversy. Value Conflicts and Social Choices, ed. Rob Kling. Academic Press, 1996 (second edition). ISBN 0124150403. A collection of nearly eighty contributed papers forming a large but approachable survey of current issues, including privacy, ethical considerations, and social relationships in electronic forums. Good for orientation.
5. Internet and Electronic Commerce Law in the European Union, John Dickie, Hart Publishing, 1999. ISBN 1841130311. A concise and comprehensible guide to a confusing subject. Not meant as a manual and demands time to read. Assumes you know law to an extent and are aware of the EU's various bodies and their responsibilities.
6. Net Benefit: Guaranteed Electronic Markets: The Ultimate Potential of Online Trade, Wingham Rowan. Macmillan Business, 1999. ISBN 0333760093. Rowan puts forward the idea that a secure and guaranteed marketplace available to any seller can "rewrite the rules of trade". You would need to explore his arguments before deciding whether he's a hopeless romantic or an unsung visionary, but it's worth the effort.
7. The Business Value of Computers, Paul Strassman. The Information Economics Press, USA, 1990. ISBN 0962041327. A detailed investigation of various accounting methods for IT investments, leading up to an explanation of Strassman's notion of management value-added as a robust measure. A big book, only for the committed reader.
8. The Fifth Discipline. The Art & Practice of the Learning Organization, Peter Senge. Century, 1990. ISBN 0712656871. The book that triggered the Learning Organization movement. Long-winded, self-indulgent and full of bogus Eastern philosophy but still the main primer on the subject. There is an associated workbook, published separately.
9. The Victorian Internet: The Remarkable Story of the Telegraph and the Nineteenth Century's Online Pioneers, Tom Standage. Weidenfeld & Nicolson, 1998. ISBN 0297841483. One for those who feel that history casts a helpful light on the present. Standage's journalistic background shows in this lively story of how society and commerce responded to a then revolutionary new communication medium. There are cautionary tales, too, about believing that any such medium could cure society's ills.
10. The Witch Doctors: What the management gurus are saying, why it matters and how to make sense of it, John Micklethwait and Adrian Wooldridge. Mandarin Paperbacks, 1997. ISBN 074932645X. Not the first book to take a swing at some of the wider illogicalities of management theory but one of the most engaging. Provides a useful pocket guide to the most popular movements as well as helpful, occasionally blunt, critiques of them.
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