ICT and e-Business Impact in the Furniture Industry - empirica

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ICT and e-business impact in the furniture industryprocesses pursued by Ikea (section 3.2.3), is surely an outstanding example; it isnevertheless hardly replicable.Importance of the design areaThe green issueCAD and 3D tools are playing an increasingly important role for furniture companies.Exchange of data related to product design has a long tradition in this sector – theintroduction of CAD dates back some decades – and is diffused even among micro andsmall companies, without striking differences among countries.Case studies presented in Chapter 5 provide interesting insight on how design tools canbe further exploited for the purpose of customer-driven production and innovation,allowing a cost and timely-effective way to meet customers’ needs. In the Danona casestudy (section 5.1) made-to measure furniture is designed together with the client via a3D CAD/visualisation system, and the relevant production data are sent directly to themill. A similar approach is followed in a B2B context by the subject of another case study,the Austrian company Robinwood (section 5.5) that implemented an e-distributionplatform that allows planning, calculating and ordering customer-tailored furniture witharbitrary design.The increasing importance of environmental issues is driven by regulation and is fosteredby customers’ awareness (still limited but increasing trend). In order to effectively respondto environmental challenges, a comprehensive approach is required: environmentalissues need to be taken into account from the product concept and design phase,through procurement, production and post-sales, until de-manufacturing. Thiscomprehensive approach allows more efficient sourcing and usage of raw materials. Therole of e-business is mainly in supporting the concurrent engineering process, with acomprehensive approach that follows the global environmental impact of the product, asdemonstrated by business examples presented in section 3.1.3.e-Marketing and salesThe diversity of ICT systems and of competences is a major hurdle to integration,especially in the downstream part of the value chain. e-Business integration is still lackingbetween manufacturers and independent distributors, due to the characteristics offurniture distribution networks and to complexity of industrial categorisation and coding.The main challenge is to manage alternative product distribution mechanisms andresources effectively in complex and fragmented distribution networks. e-Marketing ande-sales activities towards final customers are still limited in this sector and are aimed atproviding technical and commercial information rather than actual e-commerce functions.Web catalogues as the most used web-based application, they may be used as a kind ofcustomer service and are not always integrated with ordering and production/distributionsystems. The Webmobili case study (section 5.8) e.g. illustrates the technical challengesrelated to the standardisation of the product classification for the purpose of e-commerce.Furniture manufacturers (and retailers) may benefit from improved interoperability andstandardisation both for integration of business processes and for the development ofB2C and B2C commerce activities.155
ICT and e-business impact in the furniture industryImpacts of ICTThe macro-economic analysis indicates that ICT and e-business have impacts on thefurniture industry, but they do not change business fundamentally. ICT is as an enabler ofinnovation and positively impact on firm performance. the ICT-driven innovation processis linked to the share of employees with university degree and of ICT practitioners, as wellas to the existence of long-standing and electronically-organised relations with businesspartners. Conversely, the overall impact of ICT on the furniture industry structure islimited. Finally, ICT and make-or-buy decisions are related, although it is not possible toestablish the direction of this link.6.2 Possible further developmentsThe market developments and changes in the business environment for the furnituresector have been comprehensively analysed in the “Study on the competitiveness,economic situation and location of production in the textiles and clothing, footwear,leather and furniture industries”, issued in May 2007 by the DG Enterprise and Industry ofthe European Commission.Some of the main conclusions regarding the furniture industry and that are relevant fortheir e-business implications, can be summarised as follows:A thorough restructuring is taking place in this industry. This will bring a selectionprocess for which many companies -especially small ones- will disappear. Themost advanced competitors will, in turn, attempt at concentrating their activities,with a dual purpose: improving market positions and getting global. Concentrationallows better market control, as well as cheaper outsourcing of components toremote competitive specialised suppliers.Competitive companies are investing in design technologies and skills, to buildtheir own brands, and to heighten their service level, especially at the point of sale.Investments are being made to develop private retail networks in order to comecloser to consumers’ expectations and tastes and increase market responsecompetencies as key elements of market strategies.The geographical relocation of markets is expected to continue and increase: theessential part of market growth will be located in now emerging economies whichmeans that export skills and competencies are going to be increasingly necessaryfor EU industries. This will imply increased networking requirements for all players.Globalisation will also affect sourcing and sub-contracting strategies in order toimprove cost control and time to market: more reactivity, better traceability, higherdifferentiation, and better environment care will be necessary to compete on aninternational market.These trends will shape a scenario in which furniture firms are likely to face increasinglycomplex business environments and will have to rely on multi-skilled and flexibleresources. Dynamic developments of ICT and e-business can be expected in response tosuch challenges. The market structure and trends, and the attitude of furniturecompanies, however, may hamper the full deployment of this process.156
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