Who’s in charge here?

When a company decides to get into e-commerce, who’s in charge? Usually the IT managers, if you believe a recent survey of — yes, IT managers — by Cambridge Technology Partners’ Cambridge Information Network. According to this survey of 170 CIO’s, in 72% of the cases the IT department is a primary driver of e-commerce, followed by the marketing department in 49% of the cases and sales in 38% of the cases. (I suppose it adds up to more than 100% because the CIO’s could give more than one answer.)

This IT leadership is a mixed blessing. On the one hand, it means that e-commerce projects can be focused on doing what IT departments do best: customer service. And that’s borne out by the survey, with customer care and customer satisfaction topping the list of motivating reasons for getting into e-commerce.

But it also means that e-commerce projects all too often happen with skimpy budgets and minimal executive support. And these projects aren’t generally tied into the company’s overall business strategy very well — in fact, monetary return on investment is one metric that most IT managers don’t use to measure the success of their e-commerce projects, according to the survey. Instead, they measure site traffic — and, secondarily, changes in the level of customer satisfaction.

Something does not compute. E-commerce, according to most commentators (including yours truly), is the biggest thing to hit business since the assembly line. It has the potential to restructure not only companies, but whole industries — revamping supply chains, reconfiguring distribution and sales networks, and providing a wealth of new transactional information about customers’ and business partners’ actions, not just demographics or beliefs.

You wouldn’t put an IT manager in charge of your business process reengineering project, would you? And yet that’s just what’s happening in the case of e-commerce. Having been given the directive to “do e-commerce,” CIO’s are being left on their own to figure it out.

For a CIO in this position, there are two possible outcomes. Either you figure out your company’s business and start thinking and acting like the CEO of its electronic arm — or prepare to be pushed off to the sidelines when your company finally wakes up and smells the coffee.

E-commerce represents a fork in the road for IT, with one path leading towards greater strategic responsibility for the company’s overall business, and the other leading towards day-to-day customer service and maintenance of infrastructural systems that are already in place. Oh, and guess what? The latter role will be increasingly outsourced.

August 4, 1998

Who’s in charge here?