|
|
Issue 99
| |
| Useful
links | ||
ABOUT THIS NEWSLETTEReBusinesslive is published by Enterprise Ireland. If you have any comments or ideas for future topics please email @ebusiness@enterprise -ireland.com | ||
|
To subscribe to the eBusiness newsletter:
| ||
| To unsubscribe from the eBusiness newsletter:
| ||
ArchivesTo read previous issues of eBusinesslive please visit our archive. | ||
Unable to click through?If you are not able to click-through to the full article, it may be because your systems administrator has disabled Internet access. Please either contact your systems administrator or click here to email us outlining your problem, for further assistance. |
DISCLAIMERThis
information has been provided by Enterprise Ireland and by third parties for information
purposes only. While every care has been taken to ensure that the content is useful
and accurate, Enterprise Ireland and any contributing third party shall have no
legal liability or responsibility for the content or the accuracy of the information
so provided, or, for any loss or damage caused arising directly or indirectly
in connection with reliance on the use of such information. Copyright © 2003
Compiled for Enterprise Ireland by Inspiration. | |
|
You can
contact any Enterprise Ireland staff member worldwide by emailing firstname.familyname@
| |
|
The Programmes of Enterprise Ireland are co-funded by EU Structural Funds. |
Virtual Collaborative Networks: how small companies can secure the benefits of scaleSmall businesses from many different industries, both traditional and hi-tech, have discovered a new way for them to succeed in the "global economy". It involves collaboration on large orders assisted by sophisticated, but relatively low cost, eBusiness facilities. One group of Swiss component manufacturers, who faced similar price pressures to many Irish companies, successfully applied this approach as part of a strategy to beat off price based competition from Eastern Europe.Small businesses from many different industries, both traditional and hi-tech, have discovered a new way for them to succeed in the "global economy". It involves collaboration on large orders assisted by sophisticated, but relatively low cost, eBusiness facilities. One group of Swiss component manufactures successfully applied this approach as part of a strategy to beat off price based competition from Eastern Europe. Traditionally many businesses join supply chains centred on larger companies. Unfortunately the companies at the bottom of such supply chains are often treated as commodity players and replaced with cheaper alternatives when the opportunity arises. Some brave companies have attempted to "go it alone" by creating sophisticated e-business architectures which directly link them to their major customers and partners. However the expense, risk and sheer management effort involved in this approach puts it beyond the reach of many. The "third way" which companies are discovering is to join "virtual collaborative networks" with other like-minded but complimentary businesses to sell and deliver collective offers to the market beyond what the individual companies could offer by themselves. For example, a group of UK Engineering companies are using this approach to collectively bid for £50M per annum of work from a large European Customer. Like many majors. this customer has a supply chain rationalisation (aka small supplier reduction) which would stop them dealing with any of the companies individually. Another example is a group of Swiss component manufacturers who used virtual collaborative networks to move up the value chain away from contract-specific components to branded solutions in the face of stern cost-based competition from Czechoslovakian companies exporting into their home market. A third example is a group of Mexican manufacturers who used this network approach to support their entry into a new, more sophisticated market (the US). So what exactly is the "Value Proposition" for such a Virtual Collaborative Network? A Virtual Collaborative Network connects businesses into peer networks that are supported by appropriate technology to give them the capabilities and competitive advantages of global enterprises particularly:
All the experience points to 3 main ones: Critical Success Factor Number 1. Not over-complicating the eBusiness technology support! The surprising thing about virtual networks is that the technology support companies need to get started and win collective new business is neither complex nor costly. When companies are starting to collaborate all they really need is a simple web-based collaboration platform which they can access from their companies (whilst travelling) which allows them to securely communicate, schedule, discuss and work on shared documents. Typically such software is offered as a hosted, pay-per-use service, which requires no software, installed at any of the client PCs (or PDAs!) Critical Success Factor Number 2. - Investing in Network Governance The biggest concern a customer will have in dealing with a network is who is accountable when things go wrong (and can I sue them if it has to come to that!). Also customers want to treat the network like a single entity not like a collection of different companies. Thus they need to see single point of contact, seamless business processes and common values from a network. This can all be grouped together under the term "Network Governance". Networks, which do not invest in building this typically unravel in their first sales pitch to any large customer once the customers procurement department starts asking probing questions. Critical Success Factor Number 3. - "ABC" Roles The most successful collaborative networks are based around 3 key roles, which can be remembered using "ABC". "A" is for the Architect who knows what the network of companies can (and cannot) deliver. The Architect is also responsible for finding companies to fill gaps in the virtual supply networks needed to deliver specific customer opportunities. "B" is for the Broker who sources potential customer opportunities for the network and then works closely with the Architect to qualify them and configure the right virtual teams to bid. "C" is for the Coach who works with the individuals in the different companies to build trust, design accountability structures, resolve issues, address conflicts of interest and build them into effective cross-company teams. It used to be said that the ability to learn quicker than your competitor was the only skill that would guarantee your survival. The small-medium businesses, who are operating virtual collaborative networks, are demonstrating that real competitive advantage lies in learning to collaborate better. Ken Thompson (kthompson@vision.com) is a Director of VISION Consulting (www.vision.com) and works with businesses and government to improve company and regional competitiveness. For more information on Virtual Networks click on http://www.vision.com/virtualnetworks/ |
