e-business - university of auckland · 2 types of e-business activities. 3 website capabilities. 4...

E-businessin New Zealand2000-2002: are we ready forthe digitaleconomy?

By Delwyn Clark, Stephen Bowden and Patricia Corner

oving into the digital economy,information and communicationtechnologies (ICTs) have createdopportunities for new types ofbusiness models, new marketsegments and numerous new

products/services. Technologies, such as theinternet, the worldwide web and e-mail, alsoprovide scope for basic business activities to beweb-enabled or conducted electronically.

Tapscott (2000) and many other commentatorson ICT uptake and utilisation have signalledthat ICTs will change the rules of the game inmany industries and sectors (Hartman, Sifonisand Kador, 2000; Wetenhall, Sutherland andBoven, 2000). This provides challenges forsenior executives, managers, governmentofficials and politicians around the globe.Research to describe and explain the impacts of new technologies on the activities and

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performance of companies and industries, andto develop theories incorporating the newelectronic business (e-business) practices, is underway. In addition, initiatives to gauge the level ofreadiness for an internet-based economy are beingconducted to provide information for policydevelopment and decision-making at national,regional and industry levels. In this article, keyfindings from New Zealand research will bepresented to (1) provide an overview of thecurrent status of e-business in New Zealand, and(2) consider readiness of New Zealand companiesto compete in the digital economy.

E-BUSINESS IN NEW ZEALAND

he status of e-commerce and e-business activitiesin New Zealand organisations has been

investigated in a series of large-scale, empiricalsurveys conducted since August 2000 (see Appendix1 for methodological details). Key findings selectedfrom these major surveys will be summarised in thisarticle to provide an overview of the current

situation in New Zealand. Five specific topics willbe outlined and discussed:

1 The uptake of ICTs including computer, internetand website usage.

2 Types of e-business activities.3 Website capabilities.4 Impacts of e-business.5 Inhibitors of e-business.

For clarification purposes, definitions ofe-commerce and e-business are provided inFigure 1. The more encompassing term, e-business,will be used throughout this article.

1 Computer, internet and website usage

In 2001, computers were used regularly in almostevery New Zealand company. The exact proportionof companies using computers increases with firm size,from 86 per cent of small firms (6-19.5 full-timeequivalent [FTE] employees) to 99 per cent of largefirms (50-plus FTE). The proportion of computerusers was also found to vary across different industries,e.g. 99 per cent in finance and accommodation, 86per cent in retail and 67 per cent in agriculture(Statistics New Zealand, 2002). Four out of five NewZealand companies had access to the internet in 2001.However, Statistics New Zealand (2002) also foundhigher proportions for larger companies (95 percent of large companies) and in certain industries,e.g. 99 per cent in accommodation, 94 per cent inproperty and business services, 93 per cent infinance, 92 per cent in insurance and 89 per centin education. As shown in Figure 2, the averagelevel of internet access in New Zealand businesseswas higher than the averages found in comparableICT surveys in Australia and Canada.

The adoption of websites by New Zealandcompanies showed the same pattern of results asthe other ICTs. In 2002, the average proportions ofcompanies with websites varied from 44 per centof the smallest companies (0-9 FTE) to 87 per centof the largest companies (100-plus FTE) (Clark,Bowden and Corner, 2002)1. In this major study,E-business Adoption and Implementation in New

T

FIGURE 1Definitions of e-commerce and e-business

Electronic commerce refers to all commercialtransactions based on the electronicprocessing and transmission of data, includingtext, sound and image. This includes electronicdata interchange (EDI), EFTPOS, electronicbanking, digital cash and other electronicpayment systems, but particularly refers tocommerce transacted over the internet.

– Ministry of Consumer Affairs (2000). ElectronicCommerce and the New Zealand Consumer.

Electronic business refers to the use ofelectronic technologies to support a wide rangeof business activities, e.g. communication,marketing, procurement, operations, ordistribution. It covers a broader range ofprocesses than trading or “commercetransactions”.

– Turban, Lee, King and Chung (2000).Foundations of Electronic Commerce:

Electronic Commerce a Managerial Perspective.

1 Different levels were found in each of the major surveys primarily forsampling reasons.

The average level of internet access in New Zealand

businesses was higher than the averages found in

comparable ICT surveys in Australia and Canada

3

Zealand, the overall New Zealand average increasedfrom 55 per cent in 2001 to 64 per cent in 2002.Industry variation of website proportions forcompanies, their customers and suppliers, for a seriesof eight New Zealand industries, is illustrated inFigure 3 (Clark, 2001). Tourism had the highestlevels of website presence (91 per cent), but onlytwo-thirds of their customers and suppliers hadwebsites. At the other extreme, only 24 per cent ofthe transportation companies had websites, although44 per cent of their suppliers had websites. Thispattern was also noted in most other industries –suppliers had higher website proportions. Apartfrom business services and transportation, fewercustomers had websites than the companies in eachindustry. Note: the capabilities of websites will bediscussed in Section 3.

2 E-business activities

A series of e-business activities were investigatedto determine levels of participation (do you do this?)and frequencies (how often do you do this?) of theseactivities in 2002 (Clark, Bowden and Corner,2002). The proportion of New Zealand companieswith computers performing these 18 activities

electronically is shown in Figure 4. Electroniccommunication activities including e-mail,sending/receiving files and information searcheswere the most frequent activities; performed hourlyor daily by more than 75 per cent of companies.Approximately half of the organisations were

SOURCE: STATISTICS NEW ZEALAND, 2002.

100%

90%

80%

70%

60%

50%

40%

30%

20%

10%

0%

Australia Canada NZ

FIGURE 2Businesses with internet access

Company, customer and supplier website proportions by industryFIGURE 3

Tourism

Exporting

Business Services

Education

Primary Sector

Manufacturing

Retailing

Transportation

NZ Industries

SOURCE: CLARK (2001) NET READINESS IN NEW ZEALAND INDUSTRIES: EMPIRICAL RESULTS, 2001.

Companies with websites Customers with websites Suppliers with websites

0% 20% 40% 60% 80% 100%


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involved with electronic financial transactions on amonthly, weekly or daily basis; including 303companies doing daily e-transactions.

Similarly, half of the organisations werepurchasing supplies online and doing marketresearch online on a monthly, weekly or daily basis.The most frequent category for companies doingthese activities, and others such as e-competitorintelligence and e-advertising/promotion, wasmonthly. Electronic links to partners via an extranetwere reported by one-third of the companies and107 of these companies used these links on a dailybasis. After-sales service was provided online by 30per cent of the computer-using organisations and26 per cent were doing electronic delivery co-ordination. One-third of the companies were doingelectronic recruitment and one in five companies

had online training for staff in their HRM activities.Although New Zealand organisations do not appearto prioritise electronic HRM activities, it isinteresting to note that leading IT companies, suchas Cisco Systems, make extensive use of electronicbusiness-to-employee (B2E) activities. Interestingly,results for business-to-business (B2B) and business-to-consumer (B2C) sales were found to be atcomparable levels in New Zealand in 2002.Estimates by Gartner Group, and other internationalforecasters of ICT activities, signal that, globally,B2B transactions occur on a much larger scale thanto B2C. This suggests that considerable scope existsfor increased B2B activity in New Zealand.

3 Website capabilities

The functionality of websites determines their

Scale of e-business activities in New Zealand, 2002FIGURE 4

External e-mail

Searching for information

Sending/receiving data filesInternal e-mail

Checking prices onlinePurchasing supplies online

E-financial transactions

Market research onlineE-competitor intelligence

Internal intranetE-advertising/promotion

Staff recruitment online

Extranet links to key partnersAfter-sales service online

E-delivery co-ordinationOnline sales to consumers

Online sales to businesses

Staff training online

SOURCE: CLARK, BOWDEN & CORNER (2002).

Never Yearly-monthly Weekly Daily-Hourly

0% 20% 40% 60% 80% 100%

Percentage of companies with computers

Although New Zealand organisations do not appear to prioritise

electronic HRM activities, leading IT companies make

extensive use of electronic business-to-employee activities

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capabilities for business processes and activities.Table 1 summarises the aggregate sampleproportions for a series of key website features fromfour of the New Zealand surveys. The most frequentwebsite functions in all four surveys werecommunication-oriented capabilities to list productsand services, provide company information andgeneric promotion/advertising. In the specialistElectronic Traders survey, these information-sharingactivities were core website functions. Also, levelsof some of the transaction-processing activities werehigher for the Electronic Traders, e.g. receivingpayments online (one in four websites) andproviding after-sales service (half of their websites).Finding that only one in five websites was capableof providing secure transactions is of some concern.However, three-quarters of New Zealand ElectronicTraders reported processing their internet ordersmanually (ACNielsen, 2001). In conjunction withdirect sales from websites, the Electronic Tradersused e-mail, phone/fax marketing, physicaloutlets/retail stores and catalogues/mail orders.

Reflecting the importance of strategic alliancesand networks, links to alliance partners werefeatured on half of the New Zealand websites. But

only 58 companies reported links to an electronictrading hub, which indicates that levels ofinvolvement in electronic marketplaces were verylow in 2002 (Clark et al., 2002).

4 Impacts of e-business

To identify the impacts of e-business on theactivities and performance of New Zealandorganisations, a comprehensive series of potentialbenefits and opportunities were investigated,including financial factors, market positioning,customer services, supplier relationships,communication issues and productivity measures.The 10 most significant impacts of e-business forNew Zealand companies in 2001 and 2002 arereported in Table 2 using mean importance valuesand top 10 rankings.

Mirroring strategic motivations, five of these keyfactors focus directly on improving customer service,communications and relationships, and threerepresent opportunities to expand the scope of thebusiness. Achieving gains from improving efficiencywas also recognised by these website companies.“Enhancing company image” was rated as the mostimportant benefit of participation in e-business

Website capabilities*TABLE 1

Note: *Aggregate sample proportions of companies with websites from four surveys:1. Clark et al. (2001). E-business Adoption and Implementation in NZ, 2001.2. Clark et al. (2002). E-business Adoption and Implementation in NZ, 2002.3. Clark (2001). Net Readiness in New Zealand Industries.4. ACNielsen (2001). A Survey of Electronic Traders in New Zealand.

Lists products and services 94.0% 94.2% 96.1% 88%

Provides company data 75.2% 68.4% 62.9% 89%

Provides generic promotions 54.2% 50.3% 60.1% 88%

Links to alliance partners 48.7% 45.6% 51.7%

Receives customer orders 39.2% 35.2% 42.6% 35%

Provides after-sales support/customer 33.2% 33.5% 38.8% 52%feedback

Provides customised promotions/services 33.0% 31.8% 33.8% 17%

Provides secure transactions 22.8% 20.6% 21.8% 18%

Receives payments online 15.3% 13.4% 14.7% 26%

Maintains account records 12.8% 11.0% 8.4% 11%

Tracks delivery services 12.0% 11.5% 9.3%

Links to e-trading hub 8.6% 8.6% 14.3%

Sends bills online (electronic invoicing) 7.7% 6.3% 6.1% 7%

1E-BUSINESSIN NZ, 2001

2E-BUSINESSIN NZ, 2002

3NET READINESSIN NZINDUSTRIES, 2001

4ELECTRONICTRADERS, 2001

FUNCTIONALITY


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activities in 2001 and 2002. The top 10 factors wereessentially the same in both surveys. The meanimportance rating of “removing geographicbarriers”, however, decreased markedly in 2002.Significant increases were found in 2002 for otherefficiency measures (decreasing order-processingcosts, reducing internal operating costs), customerservices (improving delivery of services) andrelationship building (improving relationships withsuppliers).

The impact of e-commerce on exporting activitieswas explored in the BRC Marketing and SocialResearch 2002 survey. Twenty-seven per cent ofexporters reported that “e-commerce was essential”for their export business and another 26 per centindicated “considerable assistance frome-commerce”. However, one in three exportersreported receiving “little assistance frome-commerce”. The impact of e-commerce onopportunities to develop and expand the customerbase was also investigated in this BRC survey; 63per cent of the companies rated this “important” or“very important”. In comparison, only 34 per centof businesses rated growing exporting opportunitiesas “important” or “very important” (BRC, 2002).

5 Inhibitors of e-business

The effective implementation of e-businessinitiatives is influenced by many organisational andenvironmental factors. From a policy perspective,it is very important to understand the factors thatmay act to constrain or inhibit the uptake andimplementation of e-business. A series of 30potential inhibiting factors was evaluated in theE-business Adoption and Implementation surveysin 2001 and 2002. Table 3 lists the mean importancevalues of the top 12 factors for two major sub-groups: (1) companies with websites, and (2)companies without websites (Clark et al., 2002).

Although most of the top 12 factors were thesame for the website and non-website companies in2001, the rankings of these factors varied betweenthese two groups. The same pattern was found inthe 2002 results. Mean importance values werehigher for many of these inhibiting factors for thenon-website companies and the differences werefound to be statistically significant. Overall, the mostimportant difficulties for the website companieswere low customer usage, technological issues andsecurity concerns. The top inhibiting factors for thecompanies without websites were, however,

From a policy perspective, it is very important to

understand the factors that may act to constrain or

inhibit the uptake and implementation of e-business

Impacts of e-business: mean importance values*TABLE 2

Enhancing company image 3.93 1 3.98 1

Improving information exchange with customers 3.77 2 3.76 2

Faster response to customers 3.64 3 3.49 5

Improving competitive position 3.56 4 3.44 8

Creating new business opportunities 3.56 5 3.37 9

Providing access to new customers 3.55 6 3.50 4

Improving customer service 3.53 7 3.61 3

Increasing efficiency of business processes 3.48 8 3.47 6

Removing geographic barriers 3.48 9 2.44 –

Building customer relationships 3.43 10 3.45 7

Note: *Clark et al. (2002). Companies with websites provided importance ratings forfactors on a scale of 1-5, where 1 is very low, 3 is moderate and 5 is very high.

FACTOR 2001 2002MEAN

IMPORTANCE RANKINGMEAN

IMPORTANCE RANKING

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feasibility issues linked to financial returns, marketsize and resources (specifically time and costs). Therole of partners, customers and suppliers ine-business implementation was recognised and thelack of readiness of these groups to do businesselectronically was perceived by the non-websitecompanies as a major source of difficulties. Thesefindings also indicate that the inhibitors ofe-business in New Zealand extend beyond thetechnological resources required, to incorporatea wide range of internal organisational andexternal contextual factors.

STATUS OF E-BUSINESSIN NEW ZEALAND

hree major patterns were identified in thisresearch on e-business in New Zealand

companies: (1) size matters, (2) industry matters,and (3) what matters differs for the ICT players andICT observers. The adoption of ICTs was affectedby organisational size (measured using FTEemployees). This finding reflects both the scale ofresources available for investment in newtechnologies (larger companies have greater accessto resources) and the requirements of businessprocesses (much greater scale and capabilities areneeded to co-ordinate communication and business

processes in a large diversified company than in asmall or micro business).

The uptake of ICTs for business activities variesby industry. The nature of the product/service andthe core activities in the industry value chain affectthe types of activities that can be conducted onlineor supported with web technologies. Most industriesare not offering digital products or selling physicalproducts on the internet. However, ICTs can be usedfor many other types of business activities such asprocurement of supplies, operations, marketing,distribution, communication, or companyadministration. The key is to identify the areas whereimprovements in efficiency and effectiveness ofbusiness processes can be made with ICT support.

Significant differences were found in perspectivesand priorities for the companies that had adoptedICTs (e.g. websites) and those that were stillwatching/observing the emerging technologies fromthe sidelines (non-adopters). This finding was linkedto assessment of the inhibitors/difficulties fore-business implementation and the measures toimprove uptake. The uptake and effectiveness ofe-business activities is influenced by many contextualfactors beyond an organisation’s boundaries andcontrol. For the website companies, the two topinhibitors in 2001 and 2002 were “low customer

T

Inhibiting factors: mean importance values*TABLE 3

Note: *Clark et al. (2002). Importance ratings for factors were made ona scale of 1-5, where 1 is very low, 3 is moderate and 5 is very high.

Low customer use of e-commerce 3.251 3.151 3.145 3.03

High costs of computing and network technology 3.002 3.102 2.93 3.212

(implementation)

Limited knowledge of technologies 2.983 2.895 2.89 2.95

Uncertainty of financial benefits 2.894 2.87 3.491 3.193

Concerns about security aspects 2.885 3.013 3.05 3.08

Lack of time to start new projects 2.87 3.004 3.253 3.144

Lack of experienced IT staff 2.85 2.86 3.07 3.05

Limited knowledge of e-business models 2.81 2.59 3.10 2.94

Business partners not ready 2.79 2.69 3.194 2.92

Limited size of target market 2.77 2.77 3.412 3.241

Low supplier use of e-commerce 2.73 2.67 3.11 3.06

Concerns about quality of telecommunications 2.70 2.77infrastructure

Cannot see benefits yet 3.07 3.125

Website companies Non-website companies

2001 2002 2001 2002


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use of e-commerce” and the “high costs ofcomputing and network technology”. Companieswithout websites were more concerned withfeasibility issues linked to financial returns, marketsize and resources (specifically time and costs). Thelack of readiness for e-business by other key players,including partners, customers and suppliers, wasperceived as a major difficulty by the non-websitebusinesses. The most important measures to improveuptake and effectiveness of e-business in NewZealand were improving “telecommunicationsinfrastructure”, “consumer access to the internet”and “improved security”, according to thecompanies with websites in 2002. Top priorities forthe non-website companies were “improvedsecurity”, “telecommunications infrastructure” andthe provision of “training for e-business”.

READINESS FOR THEDIGITAL ECONOMY

eyond identification of current e-businesspractices, another approach to assessing

“readiness” is to evaluate the areas that are identifiedas most critical for successful participation in thedigital economy. For these types of measurements,specific “scorecards” focus on readiness at variouslevels of analysis, e.g. national economies orindividual businesses. The Asia Pacific EconomicCo-operation (APEC) E-Commerce ReadinessAssessment Guide (APEC, 2000) was designed forcompletion at government level. This assessmentwas developed for use in partnership mode bygovernments and stakeholders to identify the areaswhere further development is needed: to developpolicies to promote e-commerce or to removebarriers to electronic trade. The assessmentincludes factors such as the levels of technologicalinfrastructure, internet access, internet usage, ITeducation, and the regulatory framework fore-commerce.

Another national economy level readinessmeasure has been developed by the EconomistIntelligence Unit (EIU). EIU has a proprietarymethodology that it uses to rank 60 countries intofour levels of e-business preparedness – e-business

leaders, e-business contenders, e-business followersand e-business laggards (EIU, 2001). TheseE-Readiness rankings are published on theebusinessforum.com website and are used forevaluating geographic markets and for internationalbenchmarking purposes. EIU employs analysts tocombine quantitative data and qualitativeassessments by country specialists into six weightedcategories for their E-Readiness measure:connectivity (30 per cent), business environment (20per cent), e-commerce consumer and businessadoption (20 per cent), legal and regulatoryenvironment (15 per cent), supporting e-services (10per cent) and social and cultural infrastructure (fiveper cent). Assuming successful e-business is notpossible without a positive business climate overall,EIU screen 70 indicators for the businessenvironment scores that provide projections for thenext five years.

To provide a company-level measure of readiness,Hartman, Sifonis and Kadir (2000) developed ascorecard using a series of factors identified froman in-depth analysis of Cisco Systems and a seriesof other “net” companies as critical for success ofan enterprise in the internet-based economy.Accordingly, this Net Readiness Scorecard evaluatesattributes of four main drivers of change:Leadership, Governance, Competencies andTechnology. There are two versions of thisscorecard: a short version, in which 20 factors areassessed to provide an approximate measure of NetReadiness; and a longer and more detailed versionthat can be completed electronically at thewww.netreadiness.com website. The extendedmeasure is designed to profile the company’s currentstate of Net Readiness, to assess its position relativeto others in the same industry (US-based) and toprovide prescriptive recommendations to improveits competitive positioning.

NET READINESS IN NEWZEALAND INDUSTRIES

he short version of the Net Readiness Scorecardwas adapted for research on New Zealand

companies in a series of different industries (Clark,

B

T

Lack of readiness for e-business by other key players,

including partners, customers and suppliers, was

perceived as a major difficulty by non-website businesses

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2001; 2002). An empiricalsurvey was used to collectevidence of current levels ofNet Readiness in eight NewZealand industry sectorswith significant roles in theeconomy and potentialinfluence in shaping thefuture prosperity of thecountry (Appendix 1).These included BusinessServices, Education,Exporting, Primary Sector,Manufacturing, RetailTrade, Transportation, andTourism. Respondentsevaluated their organisationfor each factor on a five-point Likert scale. NetReadiness scores were then calculated for eachcompany from their factor ratings and these wereaveraged to provide the mean Net Readiness valuesfor each industry and the aggregate New ZealandIndustries. Figure 5 shows the mean Net Readinessscores for each industry and the New Zealand

Mean Net Readiness scores for each industry

Tourism

Exporting

Business Services

Primary Sector

Education

Manufacturing

Retailing

Transportation

NZ Industries

SOURCE: CLARK (2001). NET READINESS IN NEW ZEALAND INDUSTRIES: EMPIRICAL RESULTS, 2001.

0 10 20 30 40 50 60 70 80Mean Net Readiness scores

FIGURE 5

aggregate result in 2001. Note: higher scores reflectincreased adaptability, responsiveness to change, andcapabilities for web-based business operations.

The Tourism industry was the clear leader of allthe industries in this study with the highest meanNet Readiness score (73.6). This result is very

Net Readiness scorecard distributions*FIGURE 6

Note: *Scores of <45 Net Agnostic, 45-59 Net Aware, 60-74 Net Savvy, 75-89 Net Leader, 90+ Net VisionarySOURCE: CLARK (2001). NET READINESS IN NEW ZEALAND INDUSTRIES: EMPIRICAL RESULTS, 2001.

40%

35%

30%

25%

20%

15%

10%

5%

0%

Net Agnostic Net Aware Net Savvy Net Leader Net Visionary

Transportation NZ Industries Tourism


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interesting as half of the Tourism companies weresmall in terms of employees (fewer than 10 FTE)and annual revenues (less than $2 million). Theresult is not surprising, however, as the levels ofICT uptake in this industry were very high (e.g. 91per cent of the companies had websites). Exportingand Business Services ranked second and third withNet Readiness means of 67.0 and 66.2 respectively.At the other end of the scale, Manufacturing andRetailing were in sixth and seventh places with veryclose means of 57.4 and 57.1. The Transportationindustry ranked eighth (at the bottom of this list)with a mean Net Readiness score of 56.1.

These overall Net Readiness results are consistentwith earlier findings signalling industry-specificfactors impacting on ICT uptake andimplementation. The nature of the product/serviceoffered and the types of business operations neededto provide those goods and services will influencethe types of technology solutions that are applicableand considered for implementation. However, thisscorecard also incorporates a wide range of otherfactors such as leadership, governance mechanisms,skills and responsiveness to change.

Figure 6 presents the overall distribution of NetReadiness scores for Tourism, Transportation andthe aggregate New Zealand Industries, using the setof five categories of increasing e-sophistication(Appendix 2) developed by Hartman, Sifonis andKador (2000).

The Net Readiness scores for the aggregate NewZealand Industries resembles a skewed bell-shapeddistribution with increasing proportions ofcompanies in the first three Net Readinesscategories; the mean Net Readiness score of 63 isat the lower quartile of the Net Savvy range. One-third of the New Zealand companies were NetSavvy, a quarter were Net Aware and one in fivewere Net Leaders, based upon their aggregate scores.Only 6.4 per cent of the New Zealand companieswere in the top Net Visionary category. In terms ofpreparedness for the digital economy, these findingssuggest that, on average, New Zealand companiesare moving forward in the right direction –establishing the capabilities for success.

Studying a series of industries enablescomparisons to be made within the sameenvironmental context and time frame. TheTourism and Transportation industries illustratethe extremes of Net Readiness found in this NewZealand research. Tourism had 10 per cent ofcompanies in the Net Visionary category and 74per cent in the combined Net Leader (nexthighest) and Net Savvy (middle) categories. In theTransportation industry, the largest categories(representing the most companies) were in themiddle and lower categories of Net Readiness – NetSavvy (32 per cent), Net Agnostic (27 per cent) andNet Aware (22 per cent). However, it was interestingto find that four per cent of the Transportationcompanies were in the highest Net Visionarycategory. Indeed in all of the industries investigatedsome companies were making significantcommitments to develop these capabilities andpreparing to incorporate more ICTs into theirbusiness activities (becoming “Net Ready”).

Readiness for the digital economy has beenevaluated empirically in this research project.Although this Net Readiness scorecard waspublished in 2000, previous studies have beenconducted only on contracts for individualcompanies. Therefore, no public data was availablefor comparison of these results. External benchmarkdata would be interesting to put these Net Readinessscores into perspective. In addition, longitudinaldata to observe changes over time within the sameindustry would be particularly useful for corporatestrategy and policy development purposes.

CONCLUSION

ey findings from the latest empirical researchon e-business in New Zealand companies and

Net Readiness in New Zealand industries have beenpresented in this article. This summary of the currentlevels of e-business activities is useful for managersto assist with their understanding of the emergingtrends in the evolving competitive landscape. Inaddition, this New Zealand-based research provides“local” data for companies to use for benchmarkingpurposes. For policy makers, this data is important

K

In terms of preparedness for the digital economy, the

findings suggest that, on average, New Zealand

companies are establishing the capabilities for success

11

to identify and develop appropriate policies andprogrammes for national, regional and industryeconomic development. Further, this type ofevidence of current business practices is used to assistwith international benchmarking of the NewZealand economy.

Finally, the question posed in the title of the articleis considered: are we ready for the digital economy?From the evidence collected on New Zealandcompanies and industries, the answer appears to bean emphatic yes! However, both the descriptivestatistics from the e-business surveys and the NetReadiness capabilities assessment signal that someNew Zealand companies and some New Zealandindustries are more ready than others to leveragenew technologies in their business processes andactivities. Looking forward, the ubiquitous challengefor managers will be to continue to use ICTseffectively and efficiently to improve theperformance of their organisations.

ACKNOWLEDGEMENTSThe E-business Adoption and ImplementationSurvey research was supported by fundingfrom the Foundation for Research, Scienceand Technology (UOWX0016) and theUniversity of Waikato Management School.The Net Readiness in New Zealand Industriesresearch was funded by the Competition andEnterprise Branch of the Ministry of EconomicDevelopment; support and advice was alsoprovided for this project by John Sifonis, CiscoSystems.

REFERENCES

ACNielsen (2001). Electronic Commerce in New Zealand: A survey ofelectronic traders [76 pages]. Retrieved August 21, 2002, from the worldwideweb: http://nzecommerce.co.nz

Asia Pacific Economic Co-operation (2000). E-Commerce readinessassessment guide. Version 5.0 [35 pages]. Retrieved January 30, 2002, fromthe worldwide web: http://www.ecommerce.gov/apec

BRC Marketing and Social Research, (2002). E-commerce survey results,May 2002.

BRC Marketing and Social Research, (2000). A survey of internet use and e-commerce, September 2000.

Clark, D.N. (2001). Net Readiness in New Zealand industries, empirical results,2001. University of Waikato Management School Monograph, ISBN 0-909013-39-X, 62p.

Clark, D.N. (2002). Getting ready for the digital economy: Net Readiness inNew Zealand industries. Strategic Change. 11(4), 195-203.

Clark, D.N., Bowden, S., & Corner, P. (2002). Adoption and implementation ofe-business in New Zealand: Comparative empirical results, 2001 and 2002.University of Waikato Management School Research Report, 2002-1, 29p.

Clark, D.N., Bowden, S., Corner, P., Gibb, J., Kearins, K., & Pavlovich, K.(2001). Adoption and implementation of e-business in New Zealand: Empiricalresults, 2001. University of Waikato Management School Research Report,2001-1, 21p.

EIU, Economist Intelligence Unit (2001). The Economist Intelligence Unit/Pyramid Research E-Readiness rankings. Retrieved January 30, 2002, fromthe worldwide web: http://www.ebusinessforum.com

Hartman A., Sifonis J., & Kador, J. (2000). Net Ready: Strategies for successin the E-conomy. New York: McGraw-Hill.

Ministry of Economic Development (MED (2000). Electronic Commerce inNew Zealand: A survey of business on the internet, Wellington: InformationTechnology Policy Group, Competition and Enterprise Branch, MED.

Statistics New Zealand (2002a). Business practices survey (2001). RetrievedAugust 22, 2002 from the worldwide web: http://www.stats.govt.nz

Statistics New Zealand (2002b). Information technology in New Zealand, 2001.Retrieved August 22, 2002 from the worldwide web: http://www.stats.govt.nz

Turban, L.E., Lee, J., King, D., & Chung, H.M. (2000). Foundations of ElectronicCommerce: Electronic Commerce a managerial perspective. New Jersey:Prentice Hall International.

Wetenhall, P., Sutherland, G., & Boven, R. (2000). After the land grab: B2BE-Commerce in Australia and New Zealand. Sydney: Boston Consulting Group.

Delwyn ClarkEXECUTIVE DIRECTOR RESEARCH

Waikato Management School

E-mail: [email protected]

Patricia CornerSENIOR LECTURER

Department of Strategic Managementand Leadership



Stephen BowdenLECTURER

Department of Strategic Managementand Leadership




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APPENDIX 1: e-business surveys, 2000-2002Table 1 lists seven major surveys conducted in New Zealand since July 2000 on the uptake and impacts of informationtechnology, e-commerce and/or e-business. Each survey was designed to collect specific data and achieve specificobjectives. As the surveys have different sampling methodologies, terminology and content, most of the majorfindings are not directly comparable.

Net Readiness categoriesAPPENDIX 2

Net Visionary This enterprise displays best-of-breed Net Readiness. Its e-business initiatives should be flourishingas all essential components (leadership, governance, competencies and technology) are in place.

Net Leader The level of Net Readiness here is impressive, but some important pieces are missing.Net Savvy This organisation displays a higher-than-average level of awareness of Net Readiness, but many of

the foundations are missing.Net Aware This organisation is aware of the net, but is not net ready. Major work is required to develop the

foundations for successful e-business efforts.Net Agnostic E-business is far from a concern for this organisation. Efforts will likely be fruitless, as understanding

of the impact of the net is lacking. SOURCE: HARTMAN, SIFONIS & KADOR (2000).

0 10 20 30 40 50 60 70 80 90 100

NET READINESS SCORESNet Agnostic

Net Aware

Net Savvy

Net Leader

NetVisionary

Overview of New Zealand e-business surveys, 2000-2002TABLE 1

MED-BRC-02

BRC Marketing &Social Research

MED

Private-sectorbusinesses

Atlantislistbrokers

CEO/ManagingDir or IT/ Comp.Mgr

Stratification bysize (FTE 6+)

Phone

26

1008

48%

Apr-May 2002

May 2002

Notes: MED Ministry of Economic Development FRST Foundation for Research, Science & TechnologyIRD Inland Revenue Department MoRST Ministry of Research, Science & TechnologyUOW University of Waikato.

MED-BRC-00

BRC Marketing &Social Research

MED

Private-sectorenterprises

UBD database

CEO/ManagingDir or IT/Comp.Mgr

Stratification (forlarge companies)

Phone

21

506

61%

25-30 Aug, 2000

Sep, 2000

BPS-STATS-01

Statistics NZ

MED, MoRST,Stats NZ

Private-sectorenterprises

Business FrameStats NZ

General Mgrs

Stratification byANZSIC & sizeFTE 6+, $30,000+ GST turnover

Mail – compulsoryStats Act 1975

88

2756

81.6% (70+%/stratum)

Jun 2001

Prelim, 30 Jan2002; IT report,May 2002

IRD-MED-01

ACNielsen

IRD/MED

Electronictraders

Website co’scompiled frommultiple sources

CEO or Gen Mgr

Website co’sscreened foractivity &participation

Phone screen;mail survey

26

800

50%

14-29 Jun 2001;Jul 2001

Jul 2001

Code Name

Researchprovider

Researchsponsor

Population

Sampling frame

Respondents

Sampling

Survey type

No. questions

No. usable responses

Response rate

Date of datacollection

Date of report

FRST-UOW-0

Univ of WaikatoMngt School

FRST, UOW

NZ-basedorganisations

Kompassdatabase

CEO, Gen Mgr,Managing Dir,Senior Partner

Stratification bysize (10+employees)

Mail – 3 phases

46

1229

20.9%

Dec 2000-Feb 2001

Apr, 2001

MED-NET-01


MED

Eight industries

Industryassociations

Senior Executives

Randomsampling frommembership lists(500 each)

Mail – 2 phases

34

1034

23.9%

May-Jun 2001

Aug 2001

FRST-UOW-02


FRST, UOW

NZ-basedorganisations

Kompassdatabase

CEO, Gen Mgr,Managing Dir,Senior Partner

Stratification bysize

Mail – 3 phases

48

1057

19.2%

Jan-Mar 2002

May 2002

E-Commerce &Internet Use

E-BusinessAdoption &

Implementation,2001

BusinessPractices

Survey, 2000

Net Readiness inNZ Industries,

2001

ElectronicTraders in NZ,

2001

E-BusinessAdoption &

Implementation,2002

E-CommerceSurvey 2002

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