E-Readiness

Şule Őzmen, ProfessorMarmara University

Istanbul, Turkey

ITC E-Trade Bridge Network SymposiumGeneva, December 2003

Where are we coming from?“e” as a way of doing things

If “e” is a way of doing things one must first decide what “things” are supposed to be done?

Remy mentioned that at the enterprise level “management readiness” means designing strategies, building production capabilities and the competence to manage export transactions

Yuri stated that the competence to manage export transactions I.e., “export readiness” means the ability to get orders, fulfil orders and maintain a satisfactory level of working capital (get paid)

Now that we know the right things to do, we will look at “e” as not a way of doing the right “things” but as a

way of doing the right “things” in the right way

“E” as a way of doing things

“e” can be used in and by all

Resource Utilization

Macro level(Government, policy levels)Meso level(Trade Support Institutions)Micro level(Enterprises)

Resource Creation

Resource Distribution

Yes

Yes

Main Purposes

Yes

What happens when“e” is used as a thing to do?

FAILED FAILED

Resource utilization in an enterprise

Understanding E-readiness

First determine the processes with which the enterprise utilize itsinformation resources

human resources

financial resources

physical resources

network resources

to its business (marketing and production)

Second, determine whether « e » would improve effectiveness

efficiency of these processes.

Third, determine whether the enterprise has the resources to use « e ».

should be to determine the benefit that an enterprise can potentially derive from applying

Information and Communication Technology (ICT)

to the management of its business by measuring:

The potential gain to the enterprise from ICT

The rate of ICT utilization within the enterprise

The ability to access the resources needed to apply ICT

The primary aim of e-readiness assessment

Use of an e-readiness assessment tool

Potential benefits from ICT is But ICT utilization is

the tool should help to:

identify:

the gaps in the enterprise’s utilization of ICT

the areas where the enterprise stands to benefit from ICT

the reason of low ICT utilization rate lack of resources ?misallocation of available resources?

Using E-SME

E-SME helps trainers and consultants to determine weaknesses as described and allows

the development of interventions.

Gap Analysis Results of Turkish SMEs

In the basic e-readiness dimensionsSignificant gaps are observed concerning:

strategic orientation,

international aspirations, ICT & e-trade planning

general understanding of ICT usage

identification of specific benefits of ICTs? implementation plan of ICT adoption

computerized applications

human resources (qualifications of personnel)

allocation of financial resources

information sharing

No gap in basic infrastructure availability

physical assets such as computer and Internet access

Using E-SME: Example 1

Producing packaging materials

172 employees ,

Revenue: $15 million

Export : 35 %

Exporting to Israel, Bulgaria, Ukraine, USA

Successful in adopting and utilizing ICT, identified itself as late adopter

No significant gap is diagnosed by e-SME tool

Manager mentioned that;

planning phase of ICT adoption and utilization progressed gradually according to the need of the enterprise.

what increased their success is to make need assessment at first

A Construction Enterprise with 40 employees.

Revenues at $10 million. No exporting

identified itself as late adopter

No significant gap is diagnosed by e-SME tool.

First computerized process was accounting system.

Manager mentioned that they have adopted according to their assessed needs

right ICT should be selected and utilized in order to save time and money (right resource allocation) in addition to obtain qualified information and enhance decision making process which lead to work efficiently

He recommends to other enterprises that selection and utilization of ICT is very important and should be done on the basis of the e-readiness assessment which helps to identify the need and opportunity to analyse the gap

Using E-SME: Example 2

It is not good business practice to invest millions in e just for the sake of « e »

Enterprises should understand what « e » is and what it is not and what it is for and must recruit staff with that understanding and this does not mean hiring computer literate people

We have « e » in our enterprise just for the sake of e. No body knows what for

« E » can serve several objectives. It is difficult to decide which objective needs to be served. Careless selection has always failed.

Instead of spending months and years to replace infrastructure, I recommend gradual replacement. Each step should be taken after the success of the previous is established.

Using E-SME: Sample Responses

Q & A

Thank You

One of the enterprise recommendation about the hardware and software investment worth mentioning here. This enterprise categorized itself as in the innovator phase in ICT adoption which refers to the earliest ICT adopter. She got annual revenue of 1.4 million euro and 20 % of its revenue is from exporting. It is a family owned and managed enterprise having 23 employees. They export automobile and building glasses and windows to Poland, Greece, Check Republic and Germany. The second generation of the company owner who is a young marketing manager of the company graduated from a credible University in Turkey seriously recommend to other enterprises not to spend money for ICT unconsiously and urge to adopt ICT but advise them to identify their ICT need first and then make the investment when necessary.

Additional Examples

Adoption and utilization sequence in Business process

The benefit derived from softwares related with accounting system can be more easily understood by the enterprises. Natural consequence of benefiting from these softwares is the integration of financial sytems to the accounting systems. ICT utilization then continued with order fulllfillment, production planning, inventory management and logistics.

One of the surveyed enterprise exactly followed this path in adoption and utilization of ICT. After the above sequence of adoption, they mentioned that utilization in human resources management came afterwards. Then they recommend to establish Intranet and continue with Web presence and start e-trade finally. This enterprise is in textile industry producing towels bathrobes and exporting to European countries and USA, has a reveue of 12 million dollars. 450 employees are working for this company and it is generating 95 % of its revenue from exporting. When this enterprise is evaluated individually, no gap has been observed in almost all of the measured items.