Asian companies warned to get e-strategy fast

Only 40 per cent of CEOs in Asian companies recognised the need for an e-commerce plan earlier than one year ago, according to Kelly, quoting research figures from Goldman, Sachs & Co.

Furthermore, only 19 per cent have completed or nearly completed implementation of e-commerce plans which enable them to tap regional markets, Kelly said.

"The true value of e-business to companies lies in aggregating business across Asia," he said Thursday at the opening of the company's office here. Most of the single-country markets in the region are not large enough to be viable on their own, with the possible exception of Japan, he said.

Companies that can address multiple markets online and build up a strong transaction flow across the region will be the successful ones. The Internet infrastructure in Asia is robust enough to support this model, according to Kelly.

"The payoff in e-business comes from high transaction volumes," he said. "Asia is still at an early stage of e-business, but there is no reason why it shouldn't take off here."

The Asian e-commerce market was worth $US5.4 billion in 1998 and will be worth $US470 billion in 2004, according to figures from market analyst IDC. Of this, 89 per cent will be from business-to-business transactions, IDC estimates. CEOs of Asian companies still need educating about where the benefits and challenges of e-commerce lie, according to Kelly. But many are proving fast learners, he said.

"First you have to explain that e-business is not just about automating the supply chain or reaching out to new markets," he said. "Companies have to give their staff the devices -- they have to e-enable their people."

Once company staff have used applications such as e-mail and company-wide group applications, they become advocates of further Internet-based processes, according to Kelly.

Advances made in telecommunications across Asia in the last year mean that there is no longer a realistic barrier to inter-country communications, according to Kelly.

Apart from established operators such as Singapore Telecommunications, Telstra and Cable & Wireless HKT, a range of new operators have emerged.

Companies like Asia Global Crossing, Level 3 Communications, Equant Network Services, GRIC Communications and Asia Satellite Telecommunications (AsiaSat) are all capable of delivering robust high-transaction communications around the region, according to Kelly.

"The infrastructure in the major Asian markets is not the problem," he said. "The challenges for e-business are getting the people and overcoming organizational inertia."

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David Legard

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