UK firms still trapped in the web

Research finds that efficiency from e-business applications is only available to a minority.

UK companies are a long way from achieving the web-enabled integrated supply chains widely tipped to be a major benefit of e-business, according to new University of Birmingham research.

The university’s Centre for Business Strategy and Procurement said that while there is evidence of some efficiency gains from e-business applications, increased revenue is proving elusive to all but a few users.

Birmingham academics questioned more than 1,000 companies and public sector bodies to compile its E-business Report 2001.

The research confirmed that take-up of new technologies is slow, with almost 80% of respondents having no e-business strategy for their supply chain and widespread scepticism over the value of web marketplaces.

Two-thirds of respondents also said there was a lack of necessary IT skills within their company and that they were unable to keep up with the pace of changing technology.

Those who have adopted e-business applications reported clear benefits in reducing costs, improving purchasing terms and speeding up processes. However, while it may be helping to make them into a leaner organisation, most of these users said they had seen no increase in business revenues as a result.

Professor Andrew Cox said the Birmingham study showed many companies are standing back from e-business altogether or ‘tinkering around the edges’ of their organisation.

‘Everyone expected the internet to bring major benefits for UK business, but we have actually seen only modest savings,’ said Cox. ‘It is possible that more time is needed to realise the benefits, or current expectations are too high.’

The research was carried out on behalf of the Chartered Institute of Purchasing & Supply, the Institute of Management and the Institute of Logistics and Transport. The full report is published by Earlsgate Press.

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