Viewpoint -- To Succeed, Change Everything

What's the best way to survive in the Internet economy? Oren Harari, professor of management in the McLaren School of Business at the University of San Francisco, can't prescribe the right formula for your company, but he's convinced of at least one thing: In order to survive, companies are going to have to literally change the way they do everything. Now before you dismiss the advice from Harari as ludicrous, reflect on how much technology has already changed the way we do things. Baby boomers like me can remember manual typewriters; adding machines; carbon copies; rotary phones; time-consuming research at libraries; and silent, grainy home movies. Not to mention TV in the days before VCRs, movie rentals, and cable hookups. In short, a world without cell phones, pagers, e-mail, fax machines, video cameras, copying machines, and printers. And those are just the tools we use to do things. Harari argues -- and it's difficult to disagree -- that what the emergence of the Internet means to the world of work is that there are no more barriers, no set places of work, no set hours, no boundaries, no secrets, no more blind allegiances to companies, and no security in supremacy. Because of this new environment for doing business, Harari -- who was one of the keynote speakers at a recent conference hosted by WorldatWork, formerly the American Compensation Assn. -- anticipates that most of the value that companies will be able to create in the future for customers will be Web-driven. He points out, for example, how Cisco Systems Inc. does nearly all of its product maintenance online, and how Dell Computer Co. has individual Web sites tailored to each corporate customer. Likewise, General Electric Co. -- aware that products, by themselves, are too cyclical and too price-sensitive -- is wrapping high-end services around them and creating one-to-one links with customers. And in a few years Ford Motor Co. is anticipating building cars to customer orders (with the customer linked directly to the factory). "This is such a profound change, yet 98% of us still look at it the wrong way," argues Harari. "Too often, companies look at Web-based efforts as something that they can just tack on to their business strategy through a Web page that provides information about the company that might have been disseminated in other ways in the past. They don't understand that this change is so pervasive that it completely changes everything from how you hire to how you do work, to where you work, and who you work with." My educated guess is that Harari is right on the money. Just look at the rapid changes in the last three years in recruiting, flexible work arrangements, and business alliances. Job hunting is another example. You can electronically file a resume and see what jobs are available at any company, plus review their entire benefits package online. Want more evidence that the times are changing? Ask yourself how you do work now compared with just a few years back. Pagers, cell phones, and laptops let you conduct business anywhere at any time. And Internet connections are everywhere from hotels to airports to restaurants, confirming Harari's assertion that, thanks to technology, "there is no [one] place of work anymore. Your office is wherever you happen to be." All of this has Harari convinced that there can be no more "order or organization as we think of it" in the business world. "You must be constantly moving, changing, and creating real value or you will lose customers. You cannot create permanence because everything is now virtual. The fast will eat the slow who are locked into the ways of the past." Yet, ironically, in this new world that technology has created, the primary fuel for success, insists Harari, will still be people. "The No. 1 strategic problem will be talent, and the No. 1 strategic asset will be brainpower," says Harari. "Everyone at the company has to create value for the entire organization. Companies will no longer ask people, 'Did you do your work?', but "Did you change your job? Did you add value? Did you improve customer retention?'" Does that sound like changing the way everything is done? To me, it does. Michael A. Verespej is an IndustryWeek Senior Editor based in Cleveland.