Originally Published January/February 2001
Introducing Web Watch
It's
human nature to want to stare at a train wreck, but there's always the
possibility that you might be missing a more uplifting sight on the
other side of the road. The conflagration caused by dot-coms as they
collided with "quaint" old-economy principles certainly has captured
our attention. Now that the smoke has cleared and nebulous new-economy
concepts have been discredited—yes, profitability does matter—we can
turn our gaze from these distractions and focus on the innumerable ways
in which the Internet has revolutionized our lives. One undeniable transformation
has occurred in the way in which healthcare products are manufactured,
distributed, and marketed. We are introducing the Web Watch section,
which will be a regular feature of this magazine, to report on these
issues and to explore their impact on the device industry.
From product design and procurement practices to overall management of the supply chain, companies are discovering that the virtual business model can produce tangible benefits in the real world. The ultimate goal, as articulated by Tom Meredith, financial officer at the computer giant Dell, is a system in which the customer places an order on the Web and the ripples are felt immediately downstream among the company's suppliers. "When the customer clicks the mouse, our suppliers will feel the ping," he said in a recent Financial Times article. The bottom-line benefits of this holistic structure can be staggering, according to observers.
The value of business-to-business e-commerce in the United States is forecast to reach $5.7 billion, or 29% of total commercial transactions, by 2004. The adoption of e-business practices can slash the costs of indirect goods and services by 8% and save more than $82 billion, according to the consulting group AMR Research. The healthcare sector stands to gain even more. According to a report issued by the Arthur D. Little consultancy, the appropriate use of the Internet for e-business transactions could reduce total healthcare expenditures by 15 to 25%. Is your company prepared to take advantage of these opportunities?
To channel e-business opportunities and capitalize on them, a number of business-to-business portals have emerged, including the Global Health Care Exchange in the United States, and Vamedis and GloMediX in Europe. How will electronic trading affect your company, and what is the relative value of these and other portals that are springing up?
On-line procurement and the de facto global nature of the Internet raises contractual and legal issues that device manufacturers will have to study closely, particularly if they do business in the litigious US environment. What are the key issues, and what are some preemptive measures you can take to avoid legal entanglements?
We will attempt to answer these and many other questions in forthcoming installments of Web Watch. In addition to providing coverage and analysis of the issues, our overriding goal will be to dispense information that can be implemented by your company. The article that appears on page 20 by Internet business consultant Joe Dysart, I believe, exemplifies this approach.
Posting your company's home page on the World Wide Web will not produce results if you don't devote the proper resources to marketing and promotional strategies, writes Dysart. Success or failure hinges on making sure the right people find your site. In his feature, he offers several tips that can help you to build traffic on your company's Web site.
I hope you find this section to be an informative and useful addition to EMDM. Don't hesitate to send us your comments as well as your suggestions on Web-related matters that you would like us to report on in future issues.
