An e-business glossary

Cluster geeking: The process by which devoted fans of anything from Dr Who to Lego bricks form internet communities to pursue their particular passion.. According to Larry Kahaner, autho

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An e-business glossary

An A-Z guide to the key e-business terms and their meaning Adhocracy: A non-bureaucratic networked organization with a

highly organic organizational design

Affiliate marketing: Pioneered by the likes of Amazon and CDNow,

anybody with a website can sign up with them as a sales affiliate and receive a commission (typically 5%-15%) for any sales that are chan-neled through the affiliate site

Anoraknophobia: An exaggerated, irrational fear of computers and

the Internet It derives from ‘anorak,’ a term once used to describe a person with trainspotting tendencies but which has evolved to embrace people obsessed with technology

Bricks and mortar: Companies that use traditional methods of selling

and distributing products

Browser: A software application that allows people to surf the web.

Some of the most popular web browsers right now are Internet Explorer, Firefox and Safari

Business process re-design: This involves changing both

organi-zational structure and processes to ensure that future customer needs can be anticipated and fulfilled in the most cost-effective manner This

is generally known as business process re-design It should not be confused with crude cost-cutting exercises (such as downsizing) although many organizations have used both approaches simulta-neously, with the result that the value of process redesign has been permanently tarnished in the eyes of many managers

Choiceboards: Interactive, online systems that let people design their

own products from a menu of attributes, prices and delivery options

Clusters: Critical masses of linked industries in one place that enjoy

a high level of success in their particular field Famous examples are Silicon Valley and Hollywood but clusters can be found everywhere According to Michael Porter, clusters can affect competition in three ways:

1 by increasing the productivity of companies based in the area

2 by driving the direction and speed of innovation in their field

3 by stimulating the formation of new businesses within the cluster

Source: Derived from an article entitled ‘Clusters and the New

Economics of Competition’ by Michael Porter, Harvard Business

Review, November–December 1998.

Cluster geeking: The process by which devoted fans of anything from

Dr Who to Lego bricks form internet communities to pursue their particular passion

Communities of practice: Groups that form within an organization,

typically of their own accord, where members are drawn to one other

by a common set of needs that may be both professional and social Compared to project teams, communities of practice are voluntary, longer-lived, have no specific deliverable, and are responsible only

to themselves Because they are free of formal strictures and hierar-chy within an organization, they can be viewed as subversive

Competitive advantage: John Kay, following in the footsteps of

Michael Porter, defines competitive advantage as: ‘The application

of distinctive capability to a specific market place differentiating an organization from its competitors and allowing it to achieve above average returns in that market’

-Competitive convergence: This is what happens when companies

are drawn towards imitation and homogeneity The result is often static

or declining prices and downward pressures on costs that compro-mise companies’ ability to invest in the business in the long term

Competitive intelligence: In a world of rapid technological change

where new and sometimes surprising competitors can suddenly appear, a company’s success will increasingly depend on how effec-tively it can gather, analyze and use information According to Larry Kahaner, author of a book on the subject, companies that can turn raw information into powerful intelligence will ‘build market share, launch new products, increase profits and destroy competitors’

Confusion marketing: A process described by the UK Consumer

Association as the way in which some businesses are seeking to deny customers the means of making an informed choice by swamping them with an excess of confusing price information The intention is clear – to make price comparisons with rivals impossible in practi-cal terms The hope is that customers will give up in frustration and stay with, or move to, well-known companies or brands Customers signing up for a mobile phone or obtaining a mortgage for a house purchase in the UK are facing confusion marketing tactics

Core competents: The small number of people in an organization

who are absolutely vital to that organization’s success Bill Gates has reflected that if 20 people were to leave Microsoft, the company would risk bankruptcy In a study by the Corporate Leadership Council, a computer firm recognized 100 ‘core competents’ out of 16,000 employ-ees; a software company had 10 out of 11,000; and a transportation group deemed 20 of its 33,000 as really critical

Customer Relationship Management (CRM): A set of techniques

and approaches designed to a provide personalized service to customers and to increase customer loyalty Increasingly viewed as a strategic issue, and one that typically requires technological support

Cyberspace: Term originally coined by William Gibson in his book

Neuromancer Now generally used to describe the notional social arena

we ‘enter’ when using computers to communicate

Data marts: Scaled-down version of a data warehouse containing

specific information of interest to a particular target group

Data mining: The process of using advanced statistical tools to

iden-tify commercially useful patterns or relationships in databases

Data warehouse: A database that can access all of a company’s

information

Discontinuities: One-off changes in the market place that force radical

change, e.g Amazon’s entry into the book market place

Disintermediation: Buzzword for how the internet is cutting out the

middlemen, enabling wholesalers/manufacturers to sell direct to the end user Classic potential victims of disintermediation are estate agents and travel agents

Domain name: Unique internet address used to identify a website,

e.g www.futurefilter.com

e-business: Using the internet or other electronic means to conduct

business The two most common models are B2C (Business-to-Consumer) and B2B (Business-to-Business) Partly due to news coverage given to high profile companies like Amazon, B2C is the better known model; on the other hand, B2B is growing faster than its more glamorous cousin

e-by gum: A term to describe the quaint practice of sending a message

via the traditional postal service using a sealed envelope

e-commerce: Commercial activity conducted via the internet Ego surfing: Looking on the web for occurrences of one’s own name e-lancers: independent contractors connected through personal

computers and electronic networks These electronically connected

-freelancers – e-lancers – join together into fluid and temporary networks to produce and sell goods and services

e-tailing: Retail strategy based on selling and order processing via

the web

e-zines: The online equivalent of print-based newsletters and

magazines

Eyeballs: A measure of the number of visits made to a website Globalization: The integration of economic activity across national

or regional boundaries, a process that is being accelerated by the impact of information technology

Going dot.com: The trend that started in the US of leaving a

well-paid job to join an internet organization

HTML: Abbreviation for Hypertext Markup Language, a computer

language, the one that most web pages are currently written in

Infomediary: A company or individual that makes money by

bridg-ing the gap between companies’ need for capture of detailed customer information and customers’ desire for protection of such informa-tion from exploitainforma-tion by companies

Informate: Term coined by Harvard academic Shoshana Zuboff to

describe the capacity for information technology to translate and make visible organizational processes, objects, behaviours and events

Intellectual capital: Intellectual material – knowledge, information,

intellectual property, experience – that can be put to use to create wealth

In a business context, the sum total of what employees in an organ-ization know that gives it a competitive edge

The Internot: Business executives or organizations that see no value

from getting online The term was devised by psychologist David Lewis, who also coined the phrase ‘road rage” to describe when motoring frustration spills over Research conducted by Lewis suggests that about half of all managers are Internots

Intranet: A network designed to organize and share information that

is accessible only by a specified group or organization

ISP: Abbreviation for Internet Service Provider, the party that connects

users to the internet

Killer app: A new good or service that establishes an entirely new

category and, by being first, dominates it, returning several hundred percent on the initial investment

Knowledge management: A system, normally computer-based, to

share information in a company with the goal of increasing levels of

responsiveness and innovation It may be tacit (inside the heads of

individual staff-members, and possibly including personal experience,

intuition, belief and values) or explicit (what has or can be written

down, including technical specifications, procedures, training manuals, financial and management information)

Mass customization: Cost-efficient mass production of goods and

services in lot sizes of one or just a few at a time as a matter of routine

m-commerce: David Potter, Chairman of Psion, predicts that

elec-tronic commerce, today conducted largely via internet connected desk-tops will soon be overtaken by mobile (or m-) commerce using mobile phone technology

Meme: An idea, behaviour, or skill that can be transferred from one

person to another by imitation Examples include the way in which

we copy ideas, inventions, songs, catch-phrases and stories from one another In a wired global economy, memes will have the capability

of spreading at astonishing speeds

Netiquette: A system of tacit codes encouraging members of the

on-line community to uphold certain standards of behavior

Net generation: A term coined by Don Tapscott to describe the first

generation – now in their early teens to mid-twenties – to grow up surrounded by digital media

-New capitalism: A term coined by Robert Reich, former US

Secre-tary for Labor, to characterize how the chief assets of new economy companies are intellectual assets rather than traditional assets like machinery, buildings etc

One-to-one marketing: Customizing and personalizing a product

or service to meet an individual’s specific needs

Out of the garage: A term for a young company that has just moved

to its first real office

Portal: Web page that serves as a start-point or central directory for

a range of internet services

Product overlap: This occurs when more than one generation of the

same product is available simultaneously For example, the original version of a piece of software may sell at a reduced price alongside the latest version at a higher price

Push technology: The delivery of news and multimedia information

via the world wide web to personal computers on people’s desks The Web is basically a ‘pull’ medium Users decide what they want, point their browsers at the relevant website and then pull the designated pages back to their PCs

Silver surfers: A term used to denote older members of the

popu-lation who are comfortable ‘surfing’ the internet for information and services

Spam: In a phrase, junk e-mail – unwanted messages sent to

unin-terested recipients

Sticky content: The term refers to whether a website is alluring enough

to ‘catch’ visitors as they go flying past Until recently, most compa-nies have concentrated their website efforts on increasing the flow

of traffic to their site Companies are now realizing that the empha-sis needs to be less on attracting visitors on a one-off baempha-sis, and more

on enticing visitors to stay, return again and even tell their friends

Strategic Inflection Points: A term coined by Andy Grove to describe

a moment in the life of a business when its fundamentals are about to change for better or worse

10X force: Another term coined by Andy Grove to describe a

super-competitive force that threatens the future of a business

Technology Adoption Life Cycle: Model created by Geoffrey A Moore

to demonstrate the various points at which individuals will become involved with a technological innovation Moore identifies five key groups that will become involved with any new technology at various stages of its life cycle:

1 Innovators: the technology enthusiasts

2 Early adopters: the visionaries

3 Early majority: the pragmatists

4 Late majority: the conservatives

5 Laggards: the sceptics

Viral marketing: Releasing a catchy message, typically distributed

online, with a view to the message reaching growing numbers of people, initially organically but then exponentially

Virtual organization: An organizational form representing a loose

combination of technology, expertise and networks

VOIP: Short for Voice Over Internet Protocol, the means by which

it is possible to make telephone calls using the internet rather than traditional landlines or mobile networks

World wide web: The set of all information accessible using

comput-ers and networking

Xanadu: Computer scientist Ted Nelson’s planned global hypertext

project, generally recognized as a forerunner of the web

Zombies: dot.com companies that are on their last legs, waiting for

their cash-burn rate to kill off the business

Other titles from Thorogood

GURUS ON MARKETING

Sultan Kermally

£14.99 paperback, ISBN 1 85418 243 9

£24.99 hardback, ISBN 1 85418 238 2 Published November 2003

Kermally has worked directly with many of the figures in this book, including Peter Drucker, Philip Kotler and Michael Porter It has enabled him

to summarize, contrast and comment on the key concepts with knowl-edge, depth and insight, and to offer you fresh ideas to improve your own business He describes the key ideas of each ‘guru’, places them

in context and explains their significance He shows you how they were applied in practice, looks at their pros and cons and includes the views of other expert writers

GURUS ON BUSINESS STRATEGY

Tony Grundy

£14.99 paperback, ISBN 1 85418 262 5

£24.99 hardback, ISBN 1 85418 222 6 Published June 2003

This book is a one-stop guide to the world’s most important writers on business strategy It expertly summarizes all the key strategic concepts and describes the work and contribution of each of the leading thinkers

in the field

It goes further: it analyses the pro’s and con’s of many of the key theo-ries in practice and offers two enlightening case-studies The third section of the book provides a series of detailed checklists to aid you