Marketing and the Internet
Readings and Discussion Questions
Term 4 1997
Professor John M. McCann
M March 24 Course Overview, WWW, Digital Technologies
Th March 27 Internet
- "The Silicon Age? It's Just Dawning," Business
Week, December 9, 1996
- "Networks" Scientific American, Special Issue:
The Computer in the 21st Century
- "The Economics of the Internet," The Economist
, October 19, 1996
M March 31 Conceptual Frameworks
- "Evaluating the World Wide Web: A Study of 1000 Commercial
Th April 3 Distribution
- "The Airline of the Internet," Wired, December
- "Exploiting the Virtual Value Chain," Harvard
Business Review, Nov-Dec, 1995
M April 7 Retailing
- "The Birth of Digital Commerce," Fortune,
December 9, 1996
- "Interactive Home Shopping: Issues Concerning Consumer
Acceptance and Impact on the Retail Industry" (handout; not
in course pack)
Th April 10 Advertising
- "Advertising Webonomics 101," Wired, February,
- "Beyond the Banner," Wired, December, 1996
- "Reclaim the Deadzone," Wired, December,
M April 14 Business to Business
- "GE: The Net Pays Off," InformationWeek,
Jan. 27, 1997
- "Underwear, Activewear, Now Web-ware," PC Week
, Feb. 10, 1997
- "The Internet Inside Your Company," Fortune,
Nov. 27, 1995
Th April 17 Netpreneneurs
- "Making Money on the Net," Business Week,
September 23, 1996
- "Rosabeth Moss Kanter: Can Giants Dance in Cyberspace,"
Forbes ASAP, December 2, 1996
- "The Only Thing That Matters," Fast Company,
February-March 1997 (handout)
M April 21 Technologies 2, Telecommunications
- "Scott McNealy: Steps to a Digital World," Forbes
ASAP, Dec. 2, 1996
- "Craig McCaws Sees an Internet in the Sky," Fortune
, May 27, 1996
- "ADSL: Another Pipe Dream," Computer Shopper
, May 1996
Th April 24 The New Media
- "Going Digital Means Sharper Boob Tubes," USA
Today, Jan. 8, 1997
- "The End of TV As We Know It," Fortune, Dec.
- "Technology and the Future of Broadcasting," Web-Star
(Internet web site)
- "Intercast Brings the Web to TV," PC Magazine
, Jan. 21, 1997
M April 28 The New Ways We Work
- "Computers, Networks, and the Corporation," Scientific
American, Special Issue: The Computer in the 21st Century
- "Computers, Networks, and Work," Scientific American,
Special Issue: The Computer in the 21st Century
- "Charles Handy Sees the Future," Fortune,
Oct. 31, 1994
Th May 1 The New Ways We Live
- To be distributed
"Networks" Scientific American, Special Issue: The
Computer in the 21st Century
- What is a computer communications protocol?
- What is distributed computing?
- What is a knowbot? What role are they expected to play?
- What is circuit switching? What is packet switching?
- What are the pros and cons of circuit switching and packet
- How does Ethernet work? How does Token Ring work?
- What is Asynchronous Transfer Mode?
- Why is current cellular technology (not wireless, but cellular
wireless) not well suited for the Internet?
"The Silicon Age? It's Just Dawning," Business Week,
December 9, 1996
- Why is the chip so important?
- What did Andy Grove mean when he said "we are only at
the beginning of this revolution-in-progress?
- What metric do we commonly use to measure the speed of chips?
If you bought a new PC today, what would be the likely speed
of the chip? What will it be in 15 years?
- (How is a chip's speed related to the number of transistors
in the chip?)
- What is the size of a transistor on today's chip? What problems
do such sizes cause?
- What is a Net Computer? How does it differ from the ones
we use at Fuqua?
- What is the meaning and implication of the closing sentence:
"After the turn of the century, everything you touch will
have a chip in it."
"The Economics of the Internet," The Economist, October
- Why is the Internet swamped today? Has it always been so?
- What is the financial model used by the Internet?
- What is an intranet? An extranet? Why are they becoming
- What does the phrase "too cheap to meter" mean?
- What is the relationship between fixed and variable costs
in a telecommunications network?
- What is expected to "bring prices closer to real costs?"
- Why do some economists argue to use-based pricing of the Internet?
- In the early days of the Internet (e.g., 1990) delays meant
that different parts of a file would be sent through different
routes and thus might arrive at the receiving computing with various
delays. Why are such delays more bothersome today?
- What is a settlement mechanism? What has been the common
mechanism among telephone companies, and where are telephone companies
- What has been the Internet's settlement model? Why has this
model led to a major disagreement among small Internet Service
Providers (ISPs) and the large Internet backbone providers? Why
is this settlement model so bad for non-US ISPs?
- What schemes are being proposed to overcome the settlement
and congestion problems?
- (Where are the bottlenecks; in the wires/cables/fibers or
in the electronics?)
"Evaluating the World Wide Web: A Study of 1000 Commercial
This article reports on an evaluation of 1000 commercial or business
web sites by James Ho, an MIS professor (and probably his students).
He addresses the question what value is being created at each
site and develops a framework to evaluate web sites from a
customer's perspective. The paper first lays out the framework
in the form of a 3x4 matrix, and then applies it by examining
1000 web sites in 40 industries. Your assignment is to 1) first
understand how Professor Ho classifies companies by studying his
article and visiting his example web sites and sites of your choosing,
2) determine if you agree with his framework, and 3) suggest a
revised or new framework for determining the value created by
a web site. You should undertake the following steps:
- Read the article in the following way: study the first three
pages, skim the material in the Results and Observations by Industry
section, and study the Aggregate Results and Observations section.
- Go to the Dr. Ho's Way of the Web page (http://www.uic.edu/~jimho/wow.html)
and study his examples.
- Select one of the forty industries in the paper, use Yahoo
to find and visit web sites of companies in that industry, and
evaluate each in terms of Ho's framework. Evaluate at least 10
- Evaluate his classification framework and answer the question:
"If one of my early job assignments for my firm was to perform
a comparative analysis of the firms in our industry, would I use
Professor Ho's framework? If not, what framework would I use?"
The Airline of the Internet
- Why is logistics the next phase of the digital revolution?
- What is the meaning of the phrase "bits, not atoms, will
be the bedrock of economic activity in the Information Age"?
- Since 1980, more and more goods are moving via jet airplanes,
which is the most expensive way to move items from one point to
another. Why, then, has the expenditure on logistics in the US
dropped from 17.2% of GDP to 10.8% in 1995?
- What business was FedEx in, and what business is it in today?
- FedEx rose to a large company by "riding the leading
edge of two trends that have revolutionized the shipping business
since the late 1970s: the deregulation airline and trucking industries
in the US, and the rise of information technology." Why
do you think it took a new firm, one outside both the technology
and the airline & trucking industries, to ride the leading
edge of these two trends?
- The telecommunications industries are just now undergoing
a deregulation, and there new information technologies are rising.
Do you think that a new firm will come along and take over large
portions of this industry, just as FedEx did in the shipping industry?
- "It's a core tenet of the FedEx gospel that the data
about each shipment is just as valuable as the shipment itself."
Is that really true? Why?
- Why is the Internet an answer to their prayers? What are
FedEx's plans for the Internet?
- Smith says "The way to substitute information for mass
is to make a distribution system that's as good as a warehouse."
What does he mean?
- Smith says "The Internet is going to make it very difficult
for anybody in a middleman position to stay in business."
Reflect on this statement. IS it true? Identify five middlemen
who are exposed to such elimination.
- Will the Internet (and FedEx's vision of its impact) increase
or decrease the role of marketing in the future operation of most
Exploiting the Virtual Value Chain
- What is the value chain?
- How is information treated in the value chain process?
- What is the virtual value chain?
- What activities are involved in creating value in any stage
of the virtual value chain?
- The authors observe that companies adopt value-adding information
processes in three steps. What are they?
- What is the Law of Digital Assets? Provide an example not
mentioned in the paper.
- What are the New Economies of Scale? Provide an example
not mentioned in the paper
- What are the New Economies of Scope? Provide an example
not mentioned in the paper
- What is Transaction-Cost Compression? Provide an example
not mentioned in the paper
- What is Rebalancing Supply and Demand. Provide an example
not mentioned in the paper
- Which of these five "new principles" apply to Fed
The Birth of Digital Commerce
- The article discusses how a Web art gallery Provenance.com
is "spawning new ways to make and get a deal." Go to
their Web page at http://www.provenance.com/ and determine for
yourself if you believe that sites such as this will cause "the
harried masses to begin surfing to save time and money."
- Answer question #1 for http://www.quickquote.com/ and some
of the other sites mentioned in the article.
Interactive Home Shopping: Issues Concerning Consumer Acceptance
and Impact on the Retail Industry
For discussion purposes, we will make the following assumptions:
- In five years, 25% of US homes will been linked with IHS retailers
by broad-band connections, enabling the instantaneous transmission
of high resolution color photograph and slower transmission of
full-motion video clips to consumers.
- Consumers will have access to electronic agents that will
search across IHS retailers for specific merchandise.
- Will retail sales through IHS exceed the present sales through
catalogs? If so when?
- Will IHS account for more than 20% of non-food merchandise
sales in five years? Ten years? Why and why not do you think
it will be a significant factors in retailing? What can be done
to stimulate the growth of IHS?
- Are electronic malls attractive to consumers? Why or why
not? What can be done to make them more attractive to both consumers
- What types of merchandise are most amenable to sales through
- What will be the response by in-store retailers to this new
- What concerns do in-store retailers have about the potential
growth of the IHS channel?
- Which retailers and vendors will be the winners and losers
if consumers are attracted to the IHS channel? Why?
- Will disintermediation be significant -- vendors selling directly
to consumers, bypassing retailers?
- Who are the vendors most likely to bypass retailers and sell
directly to consumers? Why?
- What skills and resources will be needed to effectively compete
as an IHS retailer?
- If the IHS retail channel does account for significant retail
sales, how will this impact in-store retailers? Will they close
stores? Will stores be transformed? How?
Making Money on the Net
- This article starts by pointing to the failures and then describes
some success stories. We will try to put a little structure on
this topic by rewording the title and seeing what insights we
can gain. The title of this article includes the word "on".
First, change "on" to "Building" and determine
who is making money building the net. Then change "on"
to "with" and determine who is making money with the
net. Does it really matter if no one ever makes money on the
- What is the magic formula that companies are using to make
money on the net? What are their secrets?
- The article describes Amazon.com as a success story. Visit
the site and experience for yourself the secret weapon of creating
virtual communities. For instance, look at sites for particular
books such as Kiss, Bow, or Shake Hands : How to Do Business
in Sixty Countries (http://www.amazon.com/exec/obidos/ISBN=1558504443/3236-6810193-032256).
Is this really the "secret weapon of an electronic merchant"?
- Most of you are GenXers, and the article tells us that Tripod,
Inc. has been successful appeal to you. Visit the site to see
if you agree (www.tripod.com).
- What is the future of charging subscription fees for Internet
- The last page of the article contains the sentence: "The
explosive growth of electronic commerce will depend on better
payment systems." What has happened in this area since the
article was published in September, 1996?
- Why do almost all the success stories in the article involve
small and/or start-up firms ... and thus not the large firms who
have the money to launch successful Web businesses?
Can Giants Dance in Cyberspace
- What are the "expansive human possibilities of cyberspace"?
- Outline Kanter's "webs of cyberspace versus chains of
bureauspace" argument. Do you find it believable? Compelling?
- On the first page, she makes a big deal of the notion that
in today's world "customers tell producers" what to
do. Is this a wide spread trend, or has she found the
only three examples (software, pharmaceuticals, supermarkets)
where this is true? Why did she make this point? What role does
this point play in her overall argument?
- What are her three major assets of successful companies?
- She says: "Large companies can breed might-makes-right
arrogance." Identify several examples not mentioned by her.
- She says "Large organizations must tear down the confining
vertical structures that shape bureauspace -- skyscrapers, towers,
silos, walls, and tunnel vision." Does she literally mean
that big companies should get rid of their skyscrapers, their
- She says that big companies "must focus on the people
factor at the center of the information revolution."
Are the people in these companies the real problem, not the bureaucratic
organizational structure? That is, have these companies attracted
and promoted people who like and excel in bureauspace, and are
likely to dislike and fail operating in the "webs of cyberspace"?
If so, what are the implications?
The Only Thing That Matters
- What is "the only thing that matters"?
- The article starts by describing a couple of startups (F5
and Zombie) and then saying that the companies and the people
behind them "are simply not exceptional. Which is why they're
exceptionally important." What does he mean by this statement.
Why are un-exceptional firms and people exceptionally important?
- Why and how has Seattle established itself as the "ground-zero"
for startups? Why not Raleigh, or Boston or Austin?
- For the last couple of years, I have been pondering why almost
all of our students are interested in a job in a corporation
or consulting firm during a period of time when other people their
background are spurning jobs and pursuing start-up opportunities.
Why is this the case? For instance, are we attracting very few
students who share the interest of the people depicted in this
article? Or, are we attracting people from the same pool of recent
college graduates and then "indoctrinating" them (you)
to value the corporate world and not the entrepreneurial world?
Are our students in it for the money, and they
are in it for the freedom?
- Let's continue to examine #4, this time from Bar-Zeev's story
(on page 72) of going from a failed Worldesign to a successful
Disney, and then becoming disenchanted because he "wanted
to keep pushing the edge" while "there are a lot of
people at Disney, like at a lot of big companies, whose sole function
is to slow things down. They're spending hundreds of millions
of dollars, they want to make sure you're doing the right thing.
They have evaluations all the time, they're very careful about
everything. The buy-off process there is amazing. ... To stay
there and do what I wanted to do, I'd have to move up the management
chain, get allies, get resources, hire people, and sell ideas."
Bar-Zeev did not want to do this. But this seems to be exactly
what most MBA grads want to do. Thus is the different attitudes
about moving up the management chain the key factor that causes
our students to want the corporate life and not the start-up life?
- Given your answers to the questions 4 and 5, what changes,
if any, should we undertake at Fuqua?
Reclaim the Deadzone
- The net has an "information wants to be free culture"
created by a situation of abundant supply of redundant content
(at o charge and on nearly every conceivable subject) that outruns
demand. Given that situation, why are so many business people
claiming that the web is doomed if we don't find a way to pay
for all the content? Will all the content providers leave the
net if they cannot make money?
- What are the steps that the author believes advertisers can
take to improve their fortunes.
- Why will today's banner ads not generate the revenue necessary
to support a content provider such as Wired or USA Today?
- What is the purpose of today's banner ad: an invitation to
link to the advertiser's web site, or a place to create a vivid
brand experience? Visit a few banner ads at Pathfinder, Wired,
Yahoo, etc. before answering.
- Advertisers such as P&G only want to pay for the number
of people who "click through" a banner ad and not pay
for people who only view or are exposed to the ad. If this practice
becomes wide spread, what impact will it have on the future of
- The author believes that "infotainment providers can
restore the belief that real advertising can be done on their
sites." What is his prescription and do you believe it will
- What are brand modules, and how do they differ from today's
typical corporate web site?
- What is cobranding?
Beyond the Banner
- The author says that advertisers "want to abolish the
Web as we know it." What does he mean and is that true?
- The author says "Banner ads are tired, boring, and too
much like junk mail." Visit a few sites that have banner
ads and form our own opinion
- Consider the hierarchy of affects model: consumers move through
various stages in relation to a brand: unaware, aware, interested,
positive attitude, purchase, adoption, loyalty. In which of these
stages, if any, would banner ads be an effective communication
- Sponsorships are discussed on page 200. Visit some of the
sites described there (and others) and form your own opinion abut
such advertising approaches. Will sponsorship be more or less
successful than banner ads?
- What is Double Click? How might it change the nature of web
- One site, Kids.com, gives a child prizes for providing basic
information about his family, household size, hobbies, and buying
habits." What do you think of such practices? Where might
- What is a "microsite"?
Advertising Webonomics 101
- What is webonomics?
- Who are the four main groups setting the digital landscape?
What are their motivations?
- About a year ago I had a late night debate with a marketing
professor at another university who said that we could easily
understand the Internet by applying stand economic models. For
- assume the consumer's reason for using the Internet is to
- assume you know the value on the information to the consumer
and the cost of searching and acquiring that information,
- Equate marginal cost with marginal revenue and derive the
price consumers should be willing to pay for Internet access.
What does webonomics teach us about the applicability of this
- What are the five principles of webonomics and why are they
true (or believed to be true by the author)?
- Do you think micropayments have a big future on the net?
- We do not see many email links on large corporate web sites.
- Do you believe "the most important things the web can
deliver is a fully qualified lead or customer"?
- How do you "turn a site into an online focus group"?
- Is the ultimate goal of marketers to make the web like TV?
Scott McNealy: Steps to a Digital World
- McNealy tells us to "Do the math" and we will find
that corporations are spending too much money on personal computers.
What is his solution?
- McNealy says that "we've all got to speed up the corporate
body clock to get on Internet time." That seems fairly clear
for a firm like Sun that makes products for the Internet, as well
as selling and providing service over the Internet. But is that
true for the industrial-era firms such as Ford, Hartford Insurance,
Boeing, etc.? Why should they have to get on Internet time?
- McNealy says that inside companies CIOs "are already
starting to use their intranet to disintermediate the brokers
and the bureaucrats. These technologies create incredible opportunities
to drive cycle time out of your business and to improve communication."
- Is he saying that middle managers will be disintermediated?
If so, will that decrease the demand for MBA grads?
- Give examples of how these technologies are/will drive cycle
time out of your business and to improve communication.
- He says "Don't be a bug on the windshield of the car
behind you. Be the windshield." Who is he talking to ...
companies or individuals? If the latter, what does that mean
- He says "Go webtop. Publish all your information on
your Internet web." Who is he talking to ... the CIO, CEO,
or you? What are the implications?
- Where does McNealy think the puck is heading? Do you agree?
Go to a web site such as Infoworld (www.infoworld.com) or PC
Week (www.pcweek.com), search for articles about the network computer,
and form an intelligent, informed opinion.
Craig McCaws Sees an Internet in the Sky
- What is Teledesic and what makes it "so breathtakingly
- Visit the Teledesic web site (http://www.teledesic.com/) and
gain an understanding of "why the Teledesic Network represents
an inherently egalitarian technology."
- Some people say this is a silly project, one that will never
be successfully completed and implemented. What are the foundations
of their arguments? What is your position ... will it be successful?
- McCaw says that "you arrive at moments in time when an
entrepreneur, a technology, and the needs of people coincide."
That seems to describe what happened when he formed McCaw Cellular:
microprocessor technology had evolved to the point where small
cell phones and transmitters made it economically possible to
serve the communication needs of mobile people. Is the Teledesic
project at a similar stage? What are the technologies
and what are the needs of people that will be met?
- Explain how the Teledesic satellites will differ in operation
from most of today's existing satellites.
- McCaw conceived Teledesic "as a rural cellular telephony
project that would extend the reach of wireless phone networks."
What is his current conceptualization of it? Why did he switch?
Do you think his current model or his original one would have
a better chance of success? Why?
- The Teledesic homepage indicates that the following opportunities:
Building the Teledesic Network will require a Team of dedicated
individuals. We are constantly seeking exceptional candidates
with many different skill sets. Although some opportunities exist
in business development, marketing, finance, legal, and administrative,
the bulk of our hiring needs are in technical areas. Would
you go to work for them?
- This article, and more recent ones, indicate that the senior
managers at Teledesic have a vision of solving the world's urban
congestion problems. This argument is laid out in the last few
paragraphs of page 70, where McCaw describes a Guatemala village
without communications in which people must migrate to cities.
He says: "Whenever you add urban infrastructure, you ultimately
destroy everything that came before. It's like dragging the plague
around behind you. The beauty of electronic technology, unlike
cars and freeways, is that we can resolve problems that are completely
intractable when you move people physically. Moving electrons
gives us flexibility." Will this Teledesic project really
have an impact on such situations?
ADSL: Another Pipe Dream
- What is ADSL?
- ADSL is a form of a DSL ... a digital subscriber line. What
are the other forms and how does ADSL differ from them?
- Why might ADSL service grow rapidly? What is it about the
technology that could allow telephone companies to quickly roll
it out in a city such as Durham?
- This article uses a lot of jargon (4khz DC region, frequency
division multiplexing, etc.) that we will ignore. But it does
mention MPEG and MPEG-2. A search of the web using the phrase
"mpeg definition" led me to Interleave site (http://www.interleave.co.uk:80/video.htm)
where I found the material shown below. What are the implications
of being able to move multiple MPEG streams into the home via
existing telephone wires?
- MPEG (Moving Pictures Expert Group) is the new world standard
for digital video, the momentum of which is impacting industries
from Hollywood to Telecommunications.
- MPEG is taking off like wildfire in areas such as marketing,
sales, training, and home entertainment.
- MPEG-1 is primarily targeted at the computer platform, playing
30 frames per second at 352x240 resolution
- MPEG-2 is designed for High-Definition Television (HDTV) and
home entertainment, also playing at 30 fps, but with 752x480 resolution
(better than VHS videotape) delivering broadcast-quality video
Technology and the Future of Broadcasting
This article describes the technology that underlies the new
digital and HDTV. Read it as background so that the other articles
will be clearer.
Going Digital Means Sharper Boob Tubes
- What are the main differences between digital TV and analog
- What is the difference between High Definition TV (HDTV) and
digital TV (DTV)?
- Broadcasters have been given new spectrum and the freedom
to use it as they wish. This article says they could use it to
"broadcast a fantastically sharp, wide-screen picture with
six-channel surround sound" or the same station could "choose
to split its signal into five to 15 digital channels that would
look better than current analog channels." Which of the
two do you think they will do? If they do the latter, what does
it mean for broadcasters, advertisers, producers of TV video,
and for consumers?
- The article says that cable operators will probably go digital
and thus be able to start offering 700 channels. What is about
"going digital" that allows them to move from today's
50 or so channels to 700 channels?
- Is all of this just a dramatic increase in the number of TV
channels that the current television broadcast industry will fight
over? Or, will it lead to fundamental changes? If so, changes
The End of TV As We Know It
- How did Bill Gates ruin everything for the people who had
worked for years on HDTV?
- Near the end of page 60, the author says: "Even now the
networks continue to hemorrhage viewers: NBC came in first last
season with a Nielsen rating of 11.7 -- a 40% drop from the numbers
CBS enjoyed when it was on top 20 years ago." What has caused
- How much longer will we use the word "broadcasting"
and what will replace it.
- Do you think it is true that people really want their TV to
act like a PC? Isn't this silly? Don't most people, at least
in America, want to flop down in front of one of their 3.4 TV
sets, select a channel to watch, and be entertained? Haven't
all the trials of interactive TV shown that people just do not
want to interact with a television?
- When this article was published, WebTV was just coming onto
the market. What has happened to it, and what is its likely future?
- On page 68, Harry Motoro, CNN's vice president, says "We're
actually better off in a 5,000 channel universe. Even more will
people want someone who's accurate and timely." Do you believe
CNN will be better off in that 5,000 channel universe, or in today's
50 channel universe?
Intercast Brings the Web to TV
- What is Intercast?
- Is Intercast really going to "change the way we watch
- The article describes several uses of Intercast technology.
What other uses can you envision?
Computers, Networks, and the Corporation
- The authors tell us that dramatically reducing the costs of
coordination and increasing its speed and quality, these new technologies
will enable people to coordinate more effectively, to do much
more coordination and to form new, coordination-intensive business
structures." By this time in the course, we have discussed
how many companies are using the Internet. Reflect on those discussions
and identify firms that have "formed new, coordination-intensive
- On page 143, the authors predict that we will see "an
overall shift from internal decisions within firms toward the
use of markets to coordinate economic activity." The day
that I was writing this question (3/13/97), USA Today had
a story (Del Jones, "Growing Gray Area Where Blue- Meets
White-Collar") that contained the following statement: "tens
of thousands of workers are shifting each year from traditionally
permanent jobs to nomadic careers as independent contractors.
The shift is one of the powerful forces transforming the American
workplace today." Is this shift from employee to nomadic
contractor a direct example of the use of markets to coordinate
economic activity? What are examples not cited by the authors?
- Once a firm or industry moves coordination tasks into computer
networks and out of physical locations, do they not open themselves
up to more competition? That is, they seem to get an early competitive
advantage but not a continuing one. The authors tell us that
"one way to maintain an upper hand is to keep innovating
so rapidly that other firms always lag a step behind." This
is easy to say but very hard for large firms to do. So, would
not most large firms be better off if they ignored the computer
- What is the "information metabolism" of an organization?
- In the right hand column of page 145, the authors describe
changes at Phillips Petroleum, in which both senior managers and
local managers could gain access to detailed data and thus make
local decisions. First, the senior managers made the decisions,
and then they were given to the local managers. Do you think
this decision is unique to this firm? Or do you think the trend
is to (a) pull decisions from the field to the corporate headquarters,
or (2) push decisions down to the lowest levels?
- At the end of the article, the authors tell us that "when
the costs of information and coordination are not a barrier to
fulfilling people's needs and wants, other values may emerge to
shape the workplace and society." What values do you believe
will emerge to shape our workplace and society?
Computers, Networks, and Work
- On page 131 of this article, which first appeared in 1991,
the authors describe how Newsday, in an attempt to control
exploding email use, changed their email system so that reporters
could receive but not send email. Do you think this is a viable
solution to the general problem of people working with over 100
email messages a day? Do you think there really is a problem?
- I recently overhead an exposition by a fellow who is a psychiatrist
and an occasional user of email but none of the other Internet
facilities. He was heatedly arguing that you could never really
know another person unless your interaction with them was in person.
What does this article have to say about that position, if anything?
- Why does research by the authors show that when groups interact in
electronic networks, they find the following:
- more participants are induced to talk, and to talk more frankly,
- more proposals were generated than in face-to-face (F2F) groups,
- decisions take longer to reach,
- people tended to express extreme positions and to vent their
anger more often,
- shy people, and people who felt physically unattractive, were
more likely to express themselves.
- At the bottom of page 133, the authors describe how Tandem
Computers, Inc. Used a network system to ask & answer "Does
anyone know ..." questions, and to build a repository of
the answers. Thus they allowed any one person in the firm to tap
into the expertise and knowledge of the other workers. What problems
do you see in implementing such a system in most firms?
- This article, and the previous one, describe how electronic
networks are allowing firms to build new organizational structures
that are replacing hierarchies. At the same time, it is common
to read other articles about how workers and managers are not
happy because they have lost a sense of "place" and
stability. Are people happier with a neat and tidy hierarchical
structure and thus unhappy with its replacement, or are they simply
unhappy because so much change is occurring?
Charles Handy Sees the Future
- In the early 1980s, Handy predicted that "by 2000 half
the working population would be making a living outside traditional
organizations." How is that prediction holding up? Will
he be correct when 2000 rolls around?
- In The Age of Unreason, Handy gives us some insight into the
changes facing various generations in the amount of time each
spends in work. He said that when he entered the work force,
it was expected that he would work for about 100,000 hours (47
hours/week X 47 weeks/year X 47 years). He then showed that if
you reduced each of these numbers to 37, you would find that his
children can expect to work half that amount (37 X 37 X37). In
this article, he says that you should "expect to work intensively
for 25 years, not 45 years. Plan for your less intensive years
now." What is or would cause you to only work intensively
for 25 years? Where does Handy get this number?
- Do you agree with Handy's depiction of MBA programs? Is it
a true reflection of Fuqua?
- Handy tells us "What is happening now is equivalent to
what happened when the printing press was invented in the 1400s."
What happened then, and what is happening now?
- In the upper left corner of page 162, Handy tells us that
pretty soon, one-half the work force in the developed world will
be outside the organization, and that the livelihood of those
people will depend upon their competencies and education. He
says that few of them will take the time to educate themselves
and thus they will become a burden on those of us who are still
employed and/or who keep their skills up to date. Do you agree
with this assessment of our future?
- Handy says that the property concept of a company is out of
date when the primary assets of the firm are its intellectual
capital (its people). What is his proposed solution to corporate
ownership? Do you concur?
- We have seen a common pattern in firms for the past ten years,
a seeming paradox. During the same year, they will be going through
a major downsizing of their managerial work force, and aggressively
interviewing MBA students at the leading business schools. Use
Handy's writing to explain this behavior.
- If the pattern described in question #8 continues, what should
be your plans for the future?
- What does Handy mean when he advises aging baby boomers to
"Look for customers, not bosses"?
- What does Handy mean when he says "In ten years, more
education will take place outside of schools and universities
GE: The Net Pays Off
- Why did GE want to "create a consulting practice that
will provide electronic-commerce services to GE Capital units
and, eventually, outside customers"? Why outside customers?
Why did they create the unit in the first place, as opposed to
- What is a "web-based automated procurement system?
- How does GE "make money on the Internet"?
- When GE does web-based purchasing, it "results in prices
that are 10% to 15% lower." Why? Do you think this is a
short-run situation that will go away as the web becomes more
- What is the future of supply-chain management? Is it going
electronic and into the Internet? Totally?
- Compare business-to-business e-commerce with business-to-consumer
e-commerce. Which one is bigger? Why?
- The article describes GE's Trading Process Network. Visit
the web site and see for yourself why GE thinks this will change
the ways people work (http://www.tpn.geis.com/)
Underwear, Activewear, Now Web-ware
- Describe the system built by Fruit of the Loom (FL)? How
does it differ from GE's system?
- Why did the company build it?
- FL set up a subsidiary to build web sites. Why? Was it a
good idea? What are the issues involved in such a decision?
- Is FL using the system to "disintermediate" their
The Internet Inside Your Company
- Go to the Netscape Intranet Solutions web page (http://home.netscape.com/comprod/at_work/index.html),
and click on Visit the Virtual Intranet site. This leads to a
registration process which gets you into the site. Explore the
site, with particular attention to the Marketing and the Sales
Support areas. Be prepared to report on your findings in class.
- This article, which was published in late 1995, starts by
describing the Internet's "abysmal reputation among business
executives." What caused that bad reputation? Does the
Internet still have such a reputation?
- Why does applying Internet technology within a company "finally
let computers work the way they are supposed to"?
- Prior to the introduction of intranets, technologies such
as mainframes (and even local area networks) were easy to use
within a building or group of contiguous buildings, but difficult
to use from a distance. As this article says, with an intranet,
"updating a spreadsheet that resides on a workstation in
Hong Kong is almost as easy as working on one in your desktop
computer." What kind of organizational structure did the
mainframe-style technology dictate, and what new structures will
intranet technologies enable?
- What is the difference between Lotus Notes and an intranet?
- Describe how US West's Global Village "has transformed
the way the company operates." Can this result at US West
be generalized to most firms, or is it unique to an American telecommunications
- Netscape maintains a site that describes intranets in many
Visit that site, read about one firm, and be prepared to talk
about that application in class. OR Visit one of the live
demos provided at another Netscape site: http://home.netscape.com/comprod/at_work/linklist.html