N SHEKAR ON E-BUSINESS IN INDIA

More than the technological limitations, it’s the mindset limitations. Most of the customers believe that they have to do e-business, but they don’t know how to go about it. The good news is that it is not like those ERP days, when ERP was really hot, but it was constantly handled by IT.  In the e-business scene, CEOs of most companies are talking about it. But when it comes to actually putting the money where the mouth is, it becomes a bit difficult. Because these are big projects. The stage is still that of education. Fortunately we are working with some organisations, which are educating customers as to why they should not ignore this media.

E-business is not going to replace your current business. That’s very clear. In fact, we tell them e-business is another channel for you to leverage, how to get to the customer, how to meet the customer, how to keep the customer, how to service the customer. It provides you a more efficient way of doing that. The important thing is to understand how they can leverage better their current offline business to the online activity. That’s where most of the education is happening right now.

We did e-strategy for one of the companies many months back and we recommended a certain step, and still they have not done anything about that. They have even gone to the press saying that Satyam Infoway helped them in doing that, but they haven’t done anything yet. Each company is at a different stage in terms of adaptation. It does require investment, may be not as significant as an ERP implementation like SAP or something like that, but it does require significant investment. So it’s not the technological limitation. It’s more of a mindset. Its more of a, "Will I be the first guinea pig?" kind of worry.

Even before digital signatures, our solution from Sterling Commerce provided a stamp as to who is actually doing the transaction. That’s more of the technology. Today digital signatures are used in the B2C environment, rather than B2B. In India, even though the IT act has come through, the implementation is still not clear. Because we are yet to appoint a controller for digital signatures. The rules are yet to be clear, as to who can provide, how can they provide, what are the limitations and things like that. Those will really determine how fast it’s adapted.

Not in place yet. We have been waiting for that for quite some time. We have signed up with a company called Verisign, and there is a company called Sayscript, which we own 100% right now. We are expecting people to take a stake in that, so that it becomes a standard. It will take some time before digital signatures become the normal thing to do. Even in the US the act was passed recently. Only now it has been made legal. We are not too far behind. We are ready, whenever it happens we will be the first ones to support that.

We have something called an e-readiness index, which measures each customer, in terms of IT infrastructure, processes, customer orientation, geographical and product spread, how complex the business is. All these factors tell you whether it’s required or not. If the business is very smooth and you have almost two weeks of inventory in the pipeline, you don’t need e-business. If you are already having a negative working capital, you don’t need it. You might need it for different reasons like planning for information rather than inventory saving. So you need to find out why you need to do it. Those kinds of exercises need to be done for each company. To determine whether they need it or not. We have done projects for SRF, Henkel Spic, Ford... so we have worked with a few companies, but industrial houses like the TVS group, the Sanmar group, Amalgamations, Ashok Leyland etc. haven’t done anything yet.

I will relate it to any new technology or any new finding that people go through in life. There was the gold rush, than the tulip rush…you have all these rushes. Initially its so hot, people do not look at fundamentals. They forget the basics, how businesses run and things like that. I think its good that it happened so fast. It did not last too long. People got hurt, hopefully not too many. What has happened is good. Good money will start to flow in. A lot more reality checks will be in place. So that castles will not be built in the air. Eyeballs will still be there. End of the day, it’s a question of monetising. Like Jack Welch said the other day on CNBC, "It doesn’t matter what you have on the site, if you are unable to monetise it, its not worth being there". Whether you are a newspaper site, GE, Doordarshan or BNP. There has to be some level of monetisation. Monetisation doesn’t necessarily mean advertisement; it has to have a monetary value. It has to have the ability to invoke a transaction; it has to have the ability to sell itself. So it’s no longer for the sake of eyeballs. A lot more rational has to be built in. In any business there will only be a few winners, and probably four to five people will control 80% of the business, the next forty will control 18% of the business and the rest will cover whatever.

That is one other solution we are starting to offer our customers, as to how they can actually leverage advertising on the net. Today, people spend a lot of money on print media and TV. For them the Internet is yet another media. Many of them do not understand how this media works. So the good news on the net is we get feedback. Whereas the other media, you are not quite sure. You have to depend upon numbers that come once in a year. You have to depend on them to get some feedback as to how your campaign went. Whereas the net being an interactive media, that’s one big advantage.

But advertising on the net is not for everybody. Unless you are on the net yourself, there is no use advertising. So any company that wants to advertise on the net should have the presence. There is no use advertising, and when they click on the ad, you are not there. It’s not like a print ad. When the customer clicks on your ad, you should be able to take him somewhere and give him something and then make him transact. So it has to be a complete strategy. Advertising doesn’t come on its own. It has to come after you define your e-strategy. That’s the key. But advertising on the net will increase. Some people are saying it will surpass any other media in the next five years. As of today I will take it with a pinch of salt. But that’s probably closer to truth. This is where you get the users attention on a one-to-one basis.

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