Firms fail to implement e-commerce systems

5 April 2000
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06 April 2000 | Mark Whitehead

Few companies in the UK have grasped the opportunities of e-commerce, even though most recognise its benefits, according to new research.

Survey results released at the Softworld Supply Chain exhibition in Birmingham last week confirmed the widely held belief that firms are taking time adopting Internet-based systems.

More than four out of five of the companies questioned said they believed that e-commerce was essential for improving purchasing operations, but less than 5 per cent were connected to suppliers online.

The survey, conducted by consultancies Interbiz and Imark Communications, also showed that many firms are handing e-commerce responsibility to their IT departments, instead of making it a board-level project.

Richard Waller, Interbiz's European marketing director, said: "The research shows there's a lot of talk about e-commerce and many people are thinking about doing it, but the actual implementation of systems is still very low."

David Caruso, vice-president of US-based AMR Research, warned companies to think carefully. "It's not just about putting up a website. You have to provide integration with enterprise resource planning systems and customer relations capabilities," he said.

"Most of all, you need to give people a reason to log on to your site," he added. "If customers go to a site just to place an order, they might as well do it by phone. You need to involve them in a continuing, holistic relationship."

Ken Cole, business consultancy manager at QSP financial information systems and a member of CIPS's information systems committee, also offered a warning. "You hear claims that 70 per cent of procurement costs can be saved using e-commerce, but they're unverifiable," he said.

"Ten years ago people were saying that electronic data interchange was going to be purchasing's panacea, but it hasn't been for most firms. I'm not knocking e-procurement, but we need to be realistic."

Nick Wildgoose, financial controller at Virgin Atlantic Airways, said: "Whatever the hype about e-commerce, it's just an enabler. Remember that you're running a business."

The survey, answered by more than 200 companies, found that almost half had made IT departments responsible for implementing an e-commerce strategy. Only one in six firms had e-commerce managers and about the same number said that the chief executive was responsible for the strategy.


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