In the pantheon of professions, the consultant probably ranks below the weather forecaster and just a few points above the average astrologer. Who was it who remarked that a consultant is someone who borrows your watch to tell you the time, and charges you for the privilege? Imbued with such high esteem, it must be a bold entrepreneur who sets out to make a living as a consultant. What separates the successful specimens of the breed from the also-rans is the gift of prescience; the ability to interpret the 'signs' and be able to advise clients on how to profit from a trend when it emerges. That the British IT management consultancy Hyperion should have captured a client base that includes BT, De La Rue, IBM and NTT Data might indicate a business which actually understands the disciplines in which it professes an expertise.
It could be argued that none of these organisations would tolerate incompetence or ineffectiveness, thereby suggesting that the consultancy in question has been adding value somewhere along the line to have retained those clients' patronage.
The particular skill set that Hyperion boasts is electronic commerce (eCommerce), an area where techniques are emerging as rapidly as the software developers are able to add new features to their platforms. It is an area at once vaguely defined in a single phrase - "doing business electronically across the extended enterprise" - yet bounded increasingly by the parameters of the IP networks being adopted universally.
The company's first client was the London Stock Exchange in 1986. It was subsequently selected by banks, telecoms operators, vendors of technology, retailers and public sector organisations - essentially to provide independent advice. The team has been called upon to initiate projects, manage suppliers and make possible the interaction between business process and technological innovation.
Though based in the British cities of Guildford and Edinburgh, Hyperion has taken on work as far afield as the west coast of America and South East Asia. The company's turnover indicates a steady year-on-year growth of around 25% and was running at £2.3 million in the last financial year. Assuming that profitability has remained at least proportional to sales revenue, Hyperion is enjoying a period of sustained but stable growth.
Unlike Microsoft's electronic commerce partners. Hyperion has been selling its services direct to the software company. Being considerably smaller than the vendor, however, the consultancy has been able to 'duck and dive' its way through the electronic commerce arena to provide an innovative approach to eCommerce consultancy. David Birch, one of the Hyperion directors, explained the company's philosophy: "We found that traditional analytical techniques were inappropriate in this sector for two main reasons. First, the sector is still in its infancy and changing rapidly, so no-one can pretend they understand all of the dynamics of the sector. No less important is that the evolution of richly interconnected network environments seems to exhibit organic (rather than mechanistic) characteristics which defy simple analysis".
Traditional management consultants' tools do not seem to work particularly well according to Birch. "All of the critical success factors analysis in the world could not have predicted the phenomenon of Netscape or PointCast. What we believe we bring to our clients is a clear vision of where eCommerce is going and where it will impact upon their business."
Where Hyperion's vision of Electronic Commerce is at odds with other approaches is in its view that eCommerce services involve drawing together the disparate concepts of value and identity. The company argues that its vision of the future of value (based on electronic cash, smartcards and microbilling, for example) provides clients with a consistent picture of Net-based business when seen in the context of changing identity. More specific than value, identity involves technical considerations such as public key infrastructure and digital certificates.
Hyperion's work with Interactive Investor International (III) demonstrates what can be achieved by combining current technology with a vision of the future. In common with many other organisations trying to expand their business online, III was facing the problem of establishing beyond doubt the identity of those with whom it was dealing. The circumstances of III were more specific: how can an insurance company's web server know whether it is dealing an Independent Financial Advisor's (IFA's) browser?
The approach taken by Hyperion was to recommend that IFAs were issued with digital certificates which establish their credentials. When an advisor visits an insurance company's web site, the digital certificate is presented to the web server, and the credentials it contains are fed through to dynamic page generation. The pages seen by the browser will therefore be different depending on whether or not the user is an IFA. The insurance company does not have to maintain its own database of IFA usernames and passwords, or issue its own credentials.
In the banking sector, Hyperion is closely associated with the development of the Mondex electronic cash concept. The company was retained by National Westminster Bank when the idea germinated in 1990 and has remained a consultant to NatWest and Mondex International. Neil McEvoy, another of Hyperion's Directors, project-managed the first implementation of a Mondex service. He outlined the expertise that Hyperion had brought to bear. "Mondex was a highly innovative product. The idea of sending cash from one smartcard to another was genuinely new, and Mondex remains unique in this respect. The requirements for high security and high quality were rather special. We were able to support NatWest across the spectrum from initial specification to field trials".
Cellnet's Genie is another project in which Hyperion has been closely involved. The cellular operator approached the consultancy back in 1996 with a view to amalgamating the worlds of the web and mobile phones. The system which emerged allows Cellnet subscribers to direct their E-mail to their mobile phones, monitor their investment portfolios and obtain updates on other sources of information. Birch and his colleagues see a trend towards mobile phones becoming more powerful, and turning over time into portable information assistants. Were this to materialise, the scope for new services would be limitless.
Armed with the 20-20 vision of hindsight, the Hyperion consultancy is intensely optimistic about the growth and development of electronic commerce. "The digitisation of value and identity provide lucrative opportunities for organisations to take up Net-based business."It is inconceivable that the majority of those organisations - the NatWests and the Cellnets of this world amongst them - do not have the knowledge or the expertise to arrive at the same conclusion, however. One would surely hesitate to do business with a mobile phone company, for example, whose horizons were so limited that it was not looking two years; even five years down the track at the broader picture of business. But there must be a certain comfort and insurance for corporate management in paying to hear that view endorsed by a consultant.
Internet Business Solutions has a vested interest in persuading retailers of the merits of electronic commerce over the Internet. Corporates have always done business with each other on the telephone, so the movement to computer-based transactions is seen as a logical progression rather than an unnecessary involvement of technology. Electronic Data Interchange may have been the first step down the road for businesses trading over a communications network, but it created more obstacles - in terms of the protocols and professional support required - than it eliminated.
With the arrival of the Internet, however, businesses now have a communications medium which takes up a transaction where the telephone call left off. Inventory control procedures, progress chasing and invoicing, for example, are aspects of a typical business-to-business transaction which can now be handled on line without resort to paper-based systems.
As a result, electronic commerce over the Internet is starting to streamline the flow of transactions between businesses. And in the process, it will change for the better the way that those businesses operate.
For a retail community accustomed only to face-to-face contact with customers, however, the Internet might appear to hold few attractions. The telephone is usually the vehicle for fending off complaints: its most positive role in the customer relationship is probably for advising that an item ordered is now in stock. Actually doing business with customers over a 'telephonic' network would be not far short of anathema for many retailers - until they stand back and assess what electronic commerce could mean for their business.
As the MD of Internet Business Solutions (IBS), John Gillespie has a vested interest in persuading retailers of the merits of electronic commerce over the Internet. IBS specialises in developing solutions for retailers which involve commerce-enabled Web sites: visitors to such a site are provided with all of the information they might reasonably require to make an informed purchase, then carry that through to a transaction.
"Far from threatening the established ways of doing business, the Internet allows most retailers, irrespective of their size, to expand in two directions. For a start, they can increase the range of stock items on their 'shelves' without having to tie up an expensive display area on retail premises. Offering a broader selection increases the likelihood of multiple purchases.
"But the other consideration is that the Internet completely removes geographical boundaries, so that a customer can be over the other side of the world. Provided that an item is not perishable food which could not be transported under suitable conditions, there are effectively no limits to the catchment area."
With an impressive array of electronic commerce Internet sites already to their credit, Gillespie and his colleagues have probably got the measure of what it takes for a retailer to succeed on the Internet. Degrees in computer science may be useful for conceiving IT systems: diplomas in the arts may help create a Web site with its statutory quota of photographs and counter-rotating logos.
But the chances are that neither background would contribute very much to the solution which IBS is typically called upon to provide. Gillespie believes he has the answer: "The key component is an understanding of the business environment in which a retailer is operating. What influences the customers when they access a 'shopping' site? How far does the site go to help the visitor make a selection from an array of 'goods' which can be many times larger than it would be in a conventional shop?"
The MD cited the example of two web sites promoting high value consumer goods. Running under identical conditions, one took under 12 seconds to bring the customer 'inside' the shop and make it possible for a purchase to be made. The other site, that of a high profile retailer of hi-fi systems, white goods and photographic equipment, took more than a minute to reach a comparable point. Not being allowed to start shopping until long sequences of 'presentation' hurdles have been cleared is enough to make all but the most inert customers lose interest.
On the grounds that Nature abhors a vacuum, a marketplace with high potential and low entry costs - such as Web site design - attracts players of every hue and competence. It attracts the serious professional solutions provider: it is also a lure for the one-man business with a laptop PC and a Small Ad in the local paper.
For the same reason that even the smallest retailer can assume a significance out of proportion to its physical size by trading on the Internet, it can be very difficult to distinguish between the merits of the competing developers. What price a 'cut-price' web site if it generates less business than it costs to develop and maintain?
Internet Business Solutions would argue that its 'pre-Internet' history would stand it in good stead as an electronic commerce developer. Having developed one of the first effective electronic information systems for estate agents almost a decade ago (using modems and dial-up telephone lines), the company's founders evolved into providing content for Microsoft's MSN network.
This commitment of resources by IBS was at a time, however, when the Microsoft network was being promoted as the alternative to the Internet, and the US software company was seeking to achieve the critical mass of value-added providers that would tip the balance of customer acceptance. John Gillespie took up the story:
"The team was one of the first in the world to develop applications for MSN, and was contracted directly to Microsoft in Seattle to produce an inter-active multimedia chat system. With the keyboards were still warm from the coding of these programs, Microsoft made a strategic U-turn and threw its considerable weight behind the Internet. Not keen to waste the effort which this group had invested in MSN, the IBS management assessed the business case made for the Internet. There simply was no case at the time. There seemed very little point in using Web pages to deliver brochures and other static sources of information on-line, when they look an order of magnitude better in printed form." Paradoxically, the proprietary MSN network which the Internet was destined to subsume had been a breeding ground for electronic commerce applications: Microsoft was to be the gatekeeper for an array of purchases involving micro-payments - including admission to chat rooms and interactive games.
Without the immediate stimulation of electronic commerce on the Internet, therefore, the first foray by Internet Business Solutions into the 'conventional' Web arena was an information site rather than a trading post. The client was the UK's Computer Software and Services Association (CSSA), which required an Internet-based information system.
A vehicle for communicating information about CSSA member companies and their capabilities, the system provided a highly cost-effective method of distributing that material world-wide. It also illustrated the potential for a company like IBS to add real value to Web sites through electronic trading. It justified the investment by Internet Business Solutions in Microsoft's emergent eCommerce platform - Merchant Server - the forerunner of the company's Commerce Server component of Microsoft Site Server.
For a relatively small business like IBS, the fact that its own solutions were based on a Microsoft platform made the task of breaking into the retail marketplace less difficult than it might otherwise have been. "For the marketplace we were seeking to address, it was more important that we had espoused the Microsoft cause than any concern that could have been expressed that Microsoft was only then setting out down the eCommerce route."
The primary target for the company's marketing efforts remains today the upper end of the SME arena; medium-sized retailing institutions large enough to capitalise upon the investment they would have to make in the electronic commerce platform, yet operating on a scale where decision-making does not involve protracted committee consensus, and thereby hold back the implementation of a trading site.
Three years on from its first developments of network commerce solutions, Internet Business Solutions still regards itself - and the marketplace - as being on a learning curve. The company is as involved with extending the scope of existing owners of Web sites into electronic commerce as it is with helping existing retailers broaden their area of opportunity.
What may start of as 'uni-directional' information sites, for example, can be turned into revenue streams if the site owner starts offering training courses or puts a price on the information content which it had previously been offering without charge.
Listening to MD John Gillespie describe this catchment area, it is easy to define the kind of solutions that his company provides. The focus is on the Microsoft Commerce Server platform, to the extent that Internet Business Solutions now claims to have developed the largest number of systems based on this platform in the UK.
The degree of synergy between Commerce Server and the other components of the Microsoft Site Server eCommerce platform is such, however, that IBS would be able to develop 'larger' applications where a demand is seen to exist.
The solutions provided for IBS clients are built around the Microsoft Commerce Server platform. The company's management readily acknowledges a 'best of breed' approach when the Microsoft repertoire does not contain the 'bells and whistles' needed for a particular application. "We would never set out to re-invent the wheel", John Gillespie noted, "but would maximise the potential to be gained by integrating an array of specialist modules. "
The ability to draw together third party modules into the orbit of the Microsoft electronic commerce strategy is an important one, and a key factor in the company's growth. The flexibility which Gillespie believes is central to Microsoft's product development has been instrumental in allowing IBS to integrate its 'new' commerce solutions with legacy systems - such as corporate databases - operating within its customers' businesses.
For many of Internet Business Solutions' customers, however, the implementation of an electronic commerce 'front' to their business has provided the stimulus to migrate from legacy environments to Microsoft Windows NT as their networking architecture. The Internet site becomes the front end to its back office systems, so that a member of staff answering a customer query over the telephone, for example, could use the Web page to search the company's inventory for a stock item or progress an order on a supplier. "That has the added advantage of being able to provide immediate updates on promotions, discounts and the like, without staff constantly having to remember what is on special offer at any time."
If this trend identified by IBS is borne out by wider experience, the use of electronic commerce sites internally could do much to stimulate the take-up of such systems in the retail sector generally.
Gillespie had been keen earlier to contrast the sites of two retailers offering broadly similar selections of goods: his own company's client was able to demonstrate the shorter access time and an environment more closely matched to the 'real' shopping experience. The success of electronic commerce at the coalface of retailing will be influenced to a large extent by these considerations of user acceptance. It will not be sufficient simply for a retailer to claim - fifteen pages and three minutes after logging on to the site - that it has the cheapest goods or the broadest selection or the most favourable credit terms.
Delivering retailing solutions rather than software development, Internet Business Solutions has invested heavily in the technical infrastructure needed to support clients' live applications. The company's Web server, for example, is hooked into the Internet through a dedicated 10 Mbps pipeline, providing a measure of assurance to the retailers out in the field that their systems will not grind to a halt and lose customers' confidence.
With a track record in developing eCommerce sites around Microsoft's electronic commerce strategy, the IBS team is satisfied that the software vendor's own pace of development will ensure that the solutions it provides will never run out of road.
Gillespie again. "From virtually no presence at all in the commerce marketplace, Microsoft has continued to impress us with the rate at which the components of its Site Server platform have matured." Delivering the core components - as Microsoft appears to have done - is one thing. Building a team which understands the retailers' needs and the consumers' requirements - as IBS has no doubt achieved - should provide retailers with commerce sites 'fit for purpose'.
But whether that purpose can be realised is down to the mind set of the retail community. It will take a cultural change on the part of most established retailers to accept that the future of business is changing. It takes just twelve seconds for visitors to unbeatable.co.uk to appreciate just how much that change can mean in practice.
For more information please contact:
The DataCash website: Click Contact Link Contact: Gavin Breeze DataCash Tel: +44 (0)171 820 7733 Mobile: +44 (0)370 752 563 Email: Click Contact Link
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
