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Chapter 11. Views from the Edge—Conversa... > Executive Interview #4: Telecommunic...

Executive Interview #4: Telecommunications



Director, Internet Business Group: Bob Clinton


The company provides embedded electronic solutions, software-enhanced devices, and communications solutions, including wireless telephone, two-way radio, messaging and satellite communications products and systems, and networking and Internet-access products. The company has annual revenues in excess of $30 billion.

Plant:What do you think are the main challenges that lie ahead for e-commerce strategists?
Clinton:There are quite a few. Understanding the evolving needs of your key constituencies—whether they are customers, suppliers, analysts, whoever—is always important. Also, strategists must stay current on emerging technologies. In other words, strategists must be both "right brain," and "left brain." It is the rare e-business strategist who can clearly identify a core constituent or market need and then match it to the optimal enabling technologies.
 The third and most important element is evaluating how the strategy not only ties into the business, but drives it. It is an ongoing challenge to tie the strategy, and its subsequent execution, to some quantifiable measurable manner, so that it impacts the bottom line—efficiency, quality, or consistency of message. You have to be able to make, and proselytize, those connections.
 As you and I have been talking [in the research for the book] the supply chain space has changed tremendously. Many B2B segments and enabling infrastructure market plays (i.e., ERP/CRM) are fragmenting their focus into "vertical portals" and "trading hubs." You're seeing aggressive "go vertical movement" now in specific industries like fluids, oil, and gas, which traditionally were not leading-edge enablers of technology. Coincident with this movement is the integration of those industries' dynamic pricing structures. I expect you'll see this carry over into the more staid businesses.
 From an evolving technology viewpoint, the logical extension of the Internet into the wireless space is just beginning. If you think that the Internet revolution is big, the wireless Internet surge will take it to the next level of adoption. Wireless implies a number of things: mobility, ubiquity, and untethered productivity. Think of the Internet as making organizations irrelevant. Adding a wireless component, whether a cell phone, pager, PDA, Palm Pilot, or whatever device, adds that element of mobility. It's the ultimate virtual company. The whole concept of organizations gets even more amorphous.
Plant:And you see that growing, especially in emerging markets such as Latin America?
Clinton:Yes, especially so. In areas where geography or terrain is an obstacle, like Latin America, Indonesia, and China, technology infrastructure deployment presents a challenge. You're also combining a relatively young populace with technologies that are liberating, both technologically and politically. It's going to be very interesting.
Plant:And how do you see the wireless world progressing? Handheld devices becoming the norm? Will the devices be in the phone?
Clinton:Handheld devices will be the norm and will be everywhere. Most studies today indicate that the phone is the preferred platform moving forward, probably due in part to its ubiquity and the total number of cell phones sold. Then again, the distinction among these devices and their capabilities are starting to rapidly blur.
 Let's say that there are potentially three devices: phone, pager, and handheld computer/PDA. Each of these has advantages and disadvantages. The cell phone is readily acceptable, widely available, and offers immediacy of information. However, data entry and screen size in its current format is a challenge.
 Two-way paging is a growth area and pagers are inexpensive, but there are response-time (latency) and service-coverage issues.
 Then there are the multifunction Personal Digital Assistants (PDAs), which include devices like the Palm, Handspring Visor, or Microsoft Pocket PC. They have a nice user interface and can perform many functions.
 As for cell phones, and more specifically, the first generation of Wireless Applications Protocol (WAP) phones, most of those are pretty limited in terms of their screen size. In the next three years, you are going to see the operator's cellular infrastructure evolve so the available bandwidth will increase from 64K or 144K up to a full two MB. Japan is moving aggressively in this direction, and Europe is not far behind due to its Global System for Mobile Communication (GSM) network standard. The U.S. is a little bit behind the curve, but is moving aggressively to catch up. In terms of cell phone devices, Nokia, Motorola, Ericsson, and others are cutting alliances with the architecture folks that should accelerate the drive toward a common global standard.
Plant:Do you think the challenge in this area for strategists is to be constantly aware of the changes in technology and changes in Government regulatory frameworks and be responsive to these changes?
Clinton:Yes. For example, planning a strategy for a wireless device (phone/pager/PDA) may have different implications than for a wired device (computer). You must also consider the service and the access portal.
 Wireless devices use wireless frequencies or spectrum that is controlled and allocated by the government. Wireless devices like WAP-enabled phones are dependent upon that allocation of spectrum, as well as its rate of deployment and ubiquity. In Japan, there is available spectrum controlled by the government, so deployment will be faster. In the U.S., it may be more of an issue of reallocation of existing spectrum (i.e., the lower end of the FM band currently reserved for not-for-profit organizations). For wired devices, the debate has been going on for quite a while about phone and cable company access to the home. Also, don't discount satellite Internet access to the home.
 The access portal presents, or personalizes, the information that is relevant to you. These are the "my.xxx.com" sites. The issue here is about your preferences and patterns and who has access to your "profile."
 Consider China. China recently enacted an Internet policy. Users and businesses are required to register with the government. The Internet user's rights and privacy issues are coming more to the forefront. DoubleClick, a very successful ad company in New York, drew a lot of flack because they were very successful at data mining user information and enabling companies to cross-link it to their traditional non-Internet marketing databases. This allowed companies to cross-correlate online and offline profiles. This unsettled many people who liked the perceived anonymity of the Internet.
 Conversely, other companies are moving forward to simplify the online experience. One company is piloting "drag and drop" credit card icons based on previously stored-on-the-site credit card information. Very simple: enter your info once, and no need to rekey at every site you visit. Very powerful as well. Folks hate to fill out forms. On business-consumer e-commerce sites, that's where the high dropout rate is.
Plant:Transitioning between what has been happening in e-commerce over the last year or so and looking into the future as a manager, how have you found the issues? Are they centered on keeping up with technology? Or trying to acquire the best talent—an HR issue? What is going to be the challenge going forward? Is it the continually evolving landscape and in bringing in different team members to meet those needs?
Clinton:Yes. The HR issue about lack of skilled resources has been written about pretty extensively. The challenge is in retraining workers in co-operation with the government, re-evaluating work visa requirements, and encouraging our students to enter these fields.
 New technologies and approaches are emerging every day, every minute. The challenge is to stay focused on your business end goal, and the technology approach will become self-evident. The businesses that can anticipate the needs of their customers and use applications and technologies to improve processes in an optimal manner are the ones that will succeed. Technology deployments will be in increasingly faster, iterative cycles. The opportunities will be in finding discontinuities in the marketspace and "webizing" them.
 As we move into progressive waves of Internet change, the role of the strategist will become more of the role of the visionary. The early waves were easy. Find unserved needs and fulfill them via the Internet. Or transition Old Economy companies with New Economy processes. Subsequent waves will require envisioning new approaches. This involves new arenas like anticipatory approaches, collaborative behaviors, and approaches that tie together multiple intelligent systems. Overlay on top of this security challenges, financial transactions, biometrics, and telematics and we've got a lot of opportunities to keep us busy for quite awhile.
 How we tie it all together and harness the wireless Internet is going to be fun.
Plant:Comment upon the technology a little if you can.
Clinton:Forget Gameboys, Palms, DVD players, cell phones, and all of those devices of today. Three to five years from now you will have a supercharged version of all of those devices, rolled into one, in your hand. These third-generation, or 3G devices, will be incredibly intelligent and will communicate wirelessly at incredibly fast speeds. Video will be real-time, high quality, in full color. Prototypes of these devices exist and are working in labs. The device will be personalized and will contain your credit card and other key information. It will be your little personalized wallet, or global travel experience, or Dick Tracy handset, or whatever. The world of technology is evolving and evolving rapidly. It's a race that has no end.
Plant:Thank you for sharing your insights.



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