The European e-Business Report The European e ... - empirica

The European E-Business Report 2005
E-business and the efficiency of development-to-production processes
The issue of efficiency of development and production processes is closely related to the more
general one of integration along the value chain, discussed above. However, it was treated separately
in the study because it needs to be addressed from a peculiar sector-specific angle. Sector-specific
factors that currently influence the efficiency of development and production processes are: product
proliferation, short life cycle, changing customer patterns, the need for systems that can efficiently
handle small orders and production batches, reduced lead times and rapidly changing production
parameters.
There are diverse strategies which may support companies in dealing with the issue of demand-driven
production and lead time shortening. All of them, however, imply that access to sales data should be
as detailed and up-to-date as possible. Advances in technologies, such as CRM (customer
relationship management) systems, are useful for better capturing, exploiting and managing customer
needs and preferences. Distance from the market requires links and agreements with the downstream
players of the value chain for such an issue to be effectively dealt with.
Availability and usage of structured information on customers and markets are key factors for gaining
efficiency. At a general sector level, the usage of CRM applications is limited, being adopted by firms
representing 16% of employment. Usage rises by size of the company, but even among larger firms,
this application is presently used by less than one third of players. The fragmentation of the supply
chain and the distance of many players from the final customers might account for the low diffusion of
such applications.
Emerging opportunities for marketing and sales
Data from the e-Business Survey 2005 show that selling online is not widespread in this industry and
that the corresponding volume of sales is quite low. Take-up of B2B e-commerce in the T&C industry
has been slower than in other more standardised consumer good sectors (books, music and
software). A major reason for this is the problem of product property description.
There have been remarkable technological advances, and many EU funded projects in this field are
running. However greater technological development, integration and standardisation are necessary to
implement systems for full 3 dimensional visualisation, virtual fitting and system independent colour
rendering technologies. These technologies are still complex, expensive and require a degree of
equipment and literacy which is not commonly at hand in the sector.
Although the potential benefits of e-business in exploiting data from market and customers are largely
recognised, firms from this sector are poorly involved in its use. The percentage of enterprises that use
specific ICT solutions for online marketing or sales is fairly low, representing 14% of the sector’s
employment. Even among large firms, only 20% have implemented ICT systems for this purpose.
While the large majority of companies have a website, only a minority of them use it with a proactive
marketing purpose.
An interesting, albeit not typical case study in this context is YOOX, illustrating how the web can be
used for developing brand and image. The business example of Greekfashion demonstrates the role
that an industry association can have in providing B2B related services to its members.
Case studies and business examples
The sector report on the T&C industry (July 2005) contains short case studies and examples of e-
business activity in companies from the sector. These 'activity views' support the analysis of both the
survey and from desk research, and provide further insight in current e-business trends and
developments. Exhibit 2.2-3 summarises the 'activity views' which are featured in more detail in the
report.
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