ICT and e-Business in the Pulp, Paper and Paper ... - empirica

Pulp, paper and paper products
Concluding assessment
Exhibit 5-5 summarises the assessment of ICT impact on firms from the P&P industry,
based on survey results, interviews, case studies and desk research conducted for this
study. The scores are by no means to be understood as 'exact' results of a quantitative
computation, based on any model. They are tentative, reflecting the picture emerging
from the study, and should be regarded as a vehicle to stimulate debate. It is also clear
that no such general conclusion can apply to each individual company. There will be
specific cases of SMEs and large firms with a totally different ICT experience for whom
the pattern below does not apply.
Exhibit 5-7: Impact of ICT and e-business on competition in the P&P industry
Business areas where ICT and
e-business can have an impact
1 Organisational structure
2 Work-flows / operational organisation
3 Sourcing and procurement
4 Processing of incoming orders
5 Production processes
6 Logistics (outbound & inbound)
7 Online sales
8 Customer service and support
9 Research & development
10 Product innovation
11 Process innovation
12 Skills requirements
13 Outsourcing
14 Employment
Observed impact
in large firms
low < > high
The scale has a maximum of 3 in either direction – "low" ( ) or "high" ( )
Observed impact
in SMEs
low < > high
Source: e-Business W@tch (2006)
In general, however, all available evidence suggests that the powerful ICT systems and
e-business solutions of the large companies currently allow more advanced practices,
which enable and result in greater achievements in terms of cost savings and efficiency.
Therefore, while the areas of e-business activity are similar in large and small firms, the
impact is probably more pronounced for large firms.
However, the industry has good pre-prerequisites for e-business, for example due to the
agreement on industry standards for B2B messaging. Thus, a quite dynamic
development in e-business can be expected over the next 3-5 years. The number of
companies whose systems fulfil minimum requirements to link with other companies is on
the rise. It can be argued that Metcalfe's law 117 should also apply to B2B exchanges:
when more companies are capable of exchanging data electronically, aggregate effects
(e.g. on productivity) should increase substantially.
117 The value of a network is proportional to the square of the number of users of the system. First
formulated with regard to the internet by Robert Metcalfe, founder of 3Com and co-inventor of
the Ethernet protocol.
163