The internet is changing the way we behave and communicate. How we utilise knowledge, adapt to change and view innovation is altered forever by the impact of the web. We are already experiencing a wave of change which will have a significant impact on all our lives. We are living through the information revolution predicted by Alvin Toffler in his book, The Third Wave.

E-futures means any form of communication or transaction which is enabled by electronic networks, whether we are working, learning, consuming or at leisure. It

• opens up new ways of communicating
• provides a fresh impetus to the globalisation of markets
• enables entrepreneurial people and organisations to carve out new forms of business and to harness opportunities which would have been impossible only a few years ago.

Of course, the internet also poses a threat to those businesses which have their heads in the sand and who are not prepared to adopt and change. To stand still is more dangerous than to risk moving forward.

Electronic communication is having an enormous impact on our lives at home as well as at work. Of the millions of web users, many are already shopping on-line, as well as listening to the radio; making telephone calls; investing in the stock markets; touring the world from their armchairs, tracking packages en route to their destination and conducting their banking business.

The internet is growing at a pace unprecedented in the history of economics and the dramatic pace of change is set to continue. In its recent report, 'e-commerce@its.best.uk' the Government's Performance and Innovation Unit (PIU) states that electronic commerce is important because of

• its dramatic growth and potential
• the major impact it will have on barriers to market entry
• the way it enables increased efficiency and effectiveness within business models
• the way it enables transformation of existing business models

e-commerce@its.best.uk, PIU. September 1999

The internet is growing at a pace unprecedented in the history of economics and that the dramatic pace of change is set to continue.

This drive towards an e-future is generating innovation, not only at the level of the product or the service, but also at the level of the underlying business model. Initially, the web was perceived as an 'information distribution' space, leading to applications such as putting your brochure on-line. Now however, it has moved to a model of transaction where secure, e-shopping has become possible. From the model of transaction it will evolve towards what is becoming known as pervasive computing, where e-services and e-products will merge to create new opportunities for development.

Key Issues

In the networked world, businesses and enterprises have to grapple with many complex issues. These range from problems in understanding the implications of e-futures in their own markets, to creating an e-strategy which will allow them to avoid threats from as yet unforeseen competitors. Many companies, especially small to medium sized enterprises (SME) are struggling to understand the internet and the opportunities and threats it represents.

We have identified three key issues for thinking about e-futures:

• Coping with change
• Becoming more competitive
• Understanding the customer

Coping with change

Rapid change is an everyday part of life in modern, knowledge driven economies where change is often the only constant. As the communication tools we develop become faster, the pace of change also increases. The internet enables rapid globalisation of local markets which in turn, exerts considerable pressure on local economies meeting global competition head-on. The same is true for companies of all sizes, but particularly for SME's.

• Companies need to consider alternative strategies and procedures to deal with the threats and opportunities of global competition
• Companies and organisations need to embrace innovation and instil a culture of continuous improvement if they are to keep pace with change
• Societies need to understand and plan for the impact of the exponential growth in digital communications and e-business

Becoming more competitive

"Countries that wholeheartedly embrace e-commerce will benefit from improved national economic performance. Those that do not, risk seeing trade ebb away to low cost competitors elsewhere in the world" according to Tony Blair, in the foreword to e-commerce@its.best.uk, published by the Performance and Innovation Unit (PIU), September 1999.

• UK businesses need to develop strategies to counter the threats inherent in an environment of dramatic change and increased competition.
• UK businesses have been slow to grasp the opportunities for business change and to adopt to new ways of working.
• There is a need to increase boardroom recognition of the strategic challenges of an e-future.

Understanding the customer

Understanding the customer is a powerful key to successful innovation. Detailed customer profiling is one way of learning more about customer preferences on a one-to-one basis. New forms of software are becoming available to allow organisations to gather critical data through their website when customers interact with them. This is especially critical as consumer purchasing behaviour no longer fits the traditional categories which have served marketing strategies for so long.

• Fewer than one in five UK companies are organised around their customers. Economist Intelligence Unit
• The model of 'supply and demand' will change to 'demand and supply'. Traditional marketing techniques will not provide the levels of personalisation required by the cyber-economy. Cybertrends, The Chuck Martin Interview by Rick Mathieson, in E-Business Magazine. November 1998
• Companies and customers will get much closer.