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Inside this Issue:
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Business
News via the Value Framework™ Lenses
Management Perspective
by
Mitchell Levy, Author of the book E-Volve-or-Die.com, Creator of the
Value Framework™
VMS3.info News The
Inc. Interview: How I Did It with Dany Levy
Marrying the immediacy of
the Internet to the ephemera of what's hot created one sweet, and profitable,
company for Dany Levy.
Surprise
Package: Outsource Everything with UPS
Surprise! It's those dudes in brown.
UPS's new supply-chain arm lets companies outsource everything from cell-phone
repairs to customer call centers. And yes, they do deliver. Customer Notification
It's an important part of service
agreements at Alliant Energy, where specialty software trumped manual methods
in getting the word out to industrial clients. Alliant Energy has a number of
big industrial clients who agree to come off the grid at certain times during
the year. In exchange for being "interruptible" customers, these industrial
companies receive discounts on their energy purchases. A Financial Success
KeyCorp rings up $12 million annual
hard savings with enterprise-wide content management while customer service improves.
There is a widespread and natural move toward online self-service in the financial
services industry. Monthly paper statements are not only costly, they are cumbersome
for customers as well as banks and brokers.
Getting
Ship-Shape with eBay Labeling
Back in December, I listed getting a better
handle on shipping as one of my New Year's resolutions for our little orchid business,
and I'm happy to report that eBay's recent roll-out of some integrated labeling
and shipping payment options has improved our operation considerably. Which is
not to say that there aren't any kinks in the process -- but more on that later.
The good news is that things for micro sellers have improved, and we now see the
possibility of further improvements. It really is cool to be able to print a shipping
label -- either for the U.S. Postal Service, which we use, or for UPS -- without
ever leaving eBay.
MODEL: TRANSACTIONS Wal-Mart
Launches $0.88 Digital Song Download Store
Retail giant Wal-Mart, which
bases its Internet operations out of Brisbane, on Tuesday officially launched
its digital music download store, which will undercut the current industry pricing
standard of $0.99 by charging $0.88 per song. The company said it has increased
its available catalog by over 50% since it launched a test of the service in December.
The service was developed in partnership with Anderson Merchandisers -- which
also supplies physical CDs to Wal-Mart -- and features songs from Liquid Digital
Media (formerly Liquid Audio), which was acquired by Anderson last year. Launch
promotions will include exclusive tracks from Curb Records (Tim McGraw, LeAnn
Rimes), exclusive singles from John Michael Montgomery and Gretchen Wilson, and
songs by finalists of Oprah Winfrey's "Pop-Star Challenge." Brains For Sale
Armed with an idea that he hoped would wow his audience, IBM mathematician Howard
Sachar rose to make his sales pitch in a conference room packed with 30 of J.P.
Morgan Chase's top technology executives. "Chase's future challenge is to
appear as one bank to consumers," Sachar told them. "It's a future in
which a Chase customer dials just one number, and the person on the other end
knows everything about you." MODEL:
PARTICIPANTS
CMGI
Back in the Game
Unsung service unit SalesLink operates in several supply
chain niches; acquisition of Modus creates $1B company. From its dotcom heyday,
the Internet technology holding group CMGI mostly fell off the radar following
a series of asset sales, most recently search engine AltaVista.
Under the
radar, CMGI's supply chain asset, SalesLink, has moved forward steadily in a variety
of niche categories including product assembly and configuration, supplier management,
fulfillment and distribution for high-tech clients that include Sony, Microsoft,
HP and Sun.
Mandate Improves Processes
Two key customers mandate data synchronization
for QEP, which finds present and future benefits in the alignment. QEP, a manufacturer
of tools for the flooring industry, gets 75 percent of its business from relationships
with home centers run by such companies as Lowe's and Home Depot, according to
Ron Stich, QEP's UCCet coordinator.
MODEL:
INFLUENCES
Offshore Outsourcing: India Sees IT Wages Rise
Wages rose 14 percent in India's IT-enabled services industry. The pay hikes may
not stem the flow of U.S. IT work offshore, but Atul Vashistha, chairman and CEO
of offshore consultancy NeoIT, expects the wage increases to continue for the
next several years. Offshore
outsourcing helps U.S. economy
Study predicts outsourcing will result
in creation of twice as many jobs as are lost. The outsourcing of U.S. IT jobs
to foreign workers is good for the U.S. economy and will result in the creation
of twice as many jobs as are displaced, according to a study released Tuesday
by the Information Technology Association of America (ITAA). U.S.
e-commerce to hit $100B in 2004
Number of U.S. Internet users has grown
dramatically in the eight years to 150 million. The number of U.S. users of the
Internet has passed 150 million, more than seven times the number recorded in
the initial 1996 study of the Internet carried out by comScore Networks Inc.'s
Media Metrix unit. And from a fledgling industry in 1996, overall spending online
in the U.S. is set to top $100 billion for the first time in 2004, comScore said.
Sarbanes-Oxley compliance
dates pushed back
Companies given more time to comply with new financial
reporting rules. The U.S. Securities and Exchange Commission (SEC) has pushed
back the dates by which U.S. companies must comply with the provisions of the
Sarbanes-Oxley Act relating to financial reporting within companies, SEC said
in a statement Tuesday.
Sunnyvale-Based Juniper to Acquire NetScreen for $3.5
Billion
Shares of Juniper Networks fell 11% on Monday after the network
infrastructure company announced plans to acquire fellow Sunnyvale company NetScreen
Technologies for about $3.5 billion in stock. NetScreen stock rose 36% -- to $35.94
-- in extremely heavy trading on the Nasdaq. The deal, expected to close by mid-year,
will significantly expand the product portfolio of Juniper, which makes routers
that direct Internet traffic. NetScreen is the developer of popular firewall,
anti-virus and intrusion detection software. "This is a combination of two
strong companies," said Scott Kriens, the chairman and CEO of Juniper. "Both
Juniper and NetScreen have proven their ability to execute separately, and together
we will accelerate our ability to serve an expanded market." Bank of America
sets up Indian outsourcing subsidiary
U.S. financial firms plann to relocate
more than 500,000 jobs offshore over the next five years. Bank of America Corp.
is setting up a wholly owned subsidiary in Hyderabad, India, that will process
some of the bank's back-office operations. The Continuum Solutions Pvt. Ltd. subsidiary
will have about 500 staff by the end of this year, with up to 1,000 employees
by mid-2005, said the bank, based in Charlotte, North Carolina.
HP to buy TruLogica for automated provisioning
Hewlett-Packard Co. (HP) has agreed to acquire TruLogica Inc. in order to
integrate the company's automated IT provisioning software in its HP OpenView
network management tool, HP announced Thursday. By integrating TruLogica's software
into OpenView Select Access, HP will be able to offer a complete federated identity
management system, it said. HP acquired the Select Access federated identity technology
from Baltimore Technologies PLC last year. STRATEGY:
MANAGED Change Management:
No Small Change
A well-thought-out strategy for change management is critical
to the success of any new system. Here's how four organizations reaped big dividends
by managing change. Think. Implement. Then Go Back and Measure.
When
it comes to producing lasting value, CIOs need to be demanding—of themselves,
their executive counterparts and their organizations—and committed to asking
questions that address doubts about technology's worth and an organization's ability
to use IT well. Then, when a project or process starts, it's the CIO who must
demand a review to see if the work actually makes a positive difference, says
John Glaser, vice president and CIO at Partners HealthCare System in Boston.
When the CEO is the Brand, But Falls from Grace, What's Next?
Company
founders have long believed that placing their name on their company signals their
willingness to stake their personal reputation and stand behind their products.
That's fine when things are going well and the company and the CEO whose name
it bears are held in high regard. But what if the CEO falls from grace? What happens
to a company if the CEO's name is in effect its brand - and then that name is
tarnished? Marketing experts at Wharton and elsewhere say that making a celebrity
out of a business owner can be a good thing, as long as certain safeguards are
in place. Netflix Imitators
Are Everywhere
For Dallas software engineer Adam Sills, entertainment
is as close as his mailbox. As a subscriber to Netflix, he's long since given
up on Blockbuster, where he used to rack up hefty late fees. "I'm a serial
not-returner," he explains. "If I take out a movie I keep it for a month."
Now the flat-fee, revolving-rental model popularized and patented by Netflix saves
Sills from late-fee purgatory by eliminating due dates. Instead, he keeps up to
five movies at once. When he's done with one he mails it back in a pre-supplied
envelope, and Netflix will send him another. Analytics Move
To The Clinic
At the St. John Medical Center in Tulsa, Okla., physicians
analyze blood-transfusion records stored in a data warehouse to better understand
when transfusions are most effective and why some patients' bodies react badly
to the procedure. The knowledge has helped the hospital decrease the number of
transfusions that lead to negative reactions by 18% and reduce the number of transfusions
performed by 22%, saving $1.4 million annually.
AT&T Wireless: Will Cingular's Big Bet Pay Off?
Last week Cingular, the second-largest wireless telephone firm in the U.S., beat
Britain's Vodafone in a battle for AT&T Wireless with a $41 billion bid. If
regulators approve, the merger will create the country's largest wireless telephone
company. But will Cingular be able to build real value from the deal? Professors
at Wharton and other experts give the proposed merger a thumbs-up in terms of
strategy. But they also warn that it is too early to tell whether Cingular’s
$41 billion, $15 per share cash offer will prove to be a good investment - in
part because the whole wireless telephony industry is in flux.
Why Some Start-ups Choose Cooperation over Competition
When faced with the challenge of getting its new AIDS drug, Fuzeon, on the market,
Trimeris Inc., a small biotech company based in Durham, N.C., didn't hire a sales
force or marketing staff. Instead, it partnered with Hoffman-La Roche Inc., the
Swiss pharmaceutical giant, to commercialize the drug. In a co-authored paper
entitled, When Does Start-up Innovation Spur the Gale of Creative Destruction,
Wharton management professor David Hsu argues that this sort of cooperation can
work better in certain industries than the more traditional competitive model.
It all depends on such factors as intellectual property rights, relationships
with intermediaries and the need for sizeable investments.
About
the Author: Mitchell
Levy is President
and CEO of ECnow.com (http://ecnow.com/), a management
consulting firm helping companies grow with strategic consulting and targeted
business education. The strategic consulting component focuses on helping companies
choose and manage the business models they deploy, manage and evolve. Through
the Value Framework™ (http://ecnow.com/value/),
we share a tool that allows the practitioner to merge strategic planning with
business process reengineering and execution. For qualified firms, we offer a
free 2-hour initial consultation which will result in a high-level analysis of
the business models currently in place and those planned for the future. The business
education component involves custom programs as well as off-the-shelf programs
at Universities like San Jose State where we run the Silicon Valley Executive
Business Program (http://SiliconValleyPACE.com).
Read more about Mr. Levy: http://ecnow.com/ml_bio.htm
Public speaking appearances I've given: http://ecnow.com/speaking.htm
Read about ECnow.com's media coverage: http://ecnow.com/media
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