Articles

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Business in a Virtual World



Reviewed By James F. Doyle

Beyond knowledge: Companies enter the information age when they recognize information as something of value in its own right. By Fiona Czerniawska and Gavin Potter,
Ichor Business Books/Purdue
University Press, imprint
ISBN 1-55753-194-3, 2001, 252 Pages


The bubble may not have burst but the early euphoria about the future of e-business and other information age projects has lessened considerably in the wake of the great number of failed dot-com enterprises. Venture capitalists are now much more discriminating in selecting what new e-business projects they will support. All of this has happened just at the time that conservative, established businesses have been considering ways to modify and expand their operations to accommodate the emerging information age environment. Company executives and their technical staffs know that they need to make changes in how they do business, but they are understandably unsure of what moves will be successful and not expensive disasters. As they consider their options, they might benefit from reading "Business in a Virtual World," recently reissued as an Ichor quality paperback by the Purdue University Press. Originally published by Macmillan in Great Britain, the book presents the thinking of management consultant Fiona Czerniawska and information technologist Gavin Potter on how companies can maintain and gain competitive advantage by exploiting their information resources.

Based on their respective research and experience the authors have collaborated in producing a book that explains how a business will not only survive but also thrive in the information age. Their book is not a how-to-do-it manual but a book of ideas explaining the fundamental changes that the information age is bringing about in key business practices. Their basic premise is that the information age requires that a business concentrate more energetically and creatively on the data and knowledge affecting its affairs than on the physical entities comprising its identity. It's their view that the virtual world created by information must be accorded preference over the physical world in which a business resides. It may sound like doublespeak, but their claim is that the virtual is more real than the real when a company operates in the information age marketplace.

To make their case, the authors point out that many elements of business can be converted from the physical realm of buildings, machinery and people to the virtual realm of information stored and manipulated in a computer. That, they say, opens the door to revolutionary thinking and practices in the way companies will conduct business in the information age. Their book then goes on to discuss the emerging changes in economic theory and business procedures, citing examples of how leading companies are adapting to an information-driven business environment.

What makes virtual business activities possible, of course, is computer technology. This technology now allows and in the future will increasingly allow companies to acquire and manipulate at low cost vast amounts of data relevant to every aspect of their business. More importantly the information in such data can be shared and otherwise put to work over real time communication networks that put the components of any business in immediate contact with each other and with the world at large. The authors decry the fact that all too many companies are not taking advantage of the revolutionary potential in this technology. They think they have entered the information age by putting PCs on staff members' desks and setting up a Website for customer services. At most, these steps would simply improve doing business as usual, meaning that it might improve the exchange of information about its products, customers, marketing and financial operations. A company does not enter the information age until it ceases to treat information as knowledge about things and begins to treat it as something of value in its own right. How this is done and why it must be done for a company's future survival is the substance of this book.

Readers of this book will learn to focus on information as an exploitable business resource. They will learn to see information as raw material to be worked into systems for research and product development, management and production procedures, market distribution and expansion, customer recruitment and satisfaction, budgeting and fiscal control, all performed in a virtual world requiring limited involvement of their physical counterparts. They will learn how conducting business at the virtual level will alter important economic laws and principles. For example, how the law of diminishing returns is transformed into a law of increasing returns.

One suggestion of the authors might be considered controversial. They make strong arguments for companies to make full use of customer data. For the most part, they propose uses that would keep the information in house and thereby respect its confidentiality, but they also suggest the possibility of selling such data for commercial gain. That seems to fly in the face of current public opinion on the propriety of such use.

In writing this book the authors have sounded an alert that wise business managers will heed if, as the book's subtitle suggests, they want to maintain or gain a competitive advantage in the coming information age. It is a book of stimulating ideas worth exploring and not a book of ready-made stratagems. It is a cautionary plea for business executives to design business procedures not in terms of their concrete embodiment in time and space, but in terms of their direct and immediate accessibility in the virtual world of data.

James F. Doyle is a member of the Clark Atlanta University faculty.