B Y R I C H A R D S . S Z E C S Y . P H . D. , P. E .

hat the industry is really starting to feel the power of the Internet is no secret. Many concrete production

T companies’ business cards include an e-mail address or a Web site address. That is just the beginning, how-
ever. Bob Garbini, executive director of NRMCA, says he thinks that the Internet offers immense oppor-
tunities for the creative producer to excel in customer service and product development. The use of informa-
tion technology can provide the customer with multiple choices and relay changes in real time. The most pow-
erful tool for producers’ customers is e-commerce, or Internet-enabled commercial exchanges.
The question that challenges the producer is how to use the Internet to the company’s advantage. Look
at the impact of e-mail. How did we ever conduct business before e-mail? Implementing and integrating other
Internet technologies into daily business

E-Commerce Strategy: Your Business activities should be no different. By going

back to the basics of business and cus-
tomer fundamentals, you’ll increase your chances of profitability and success. The following strategy basics will
help you keep both your business and your customers in mind as you enter the world of e-commerce.
Business fun damentals At the end of the day, ask yourself these four basic strategic questions to deter-
mine if a new Internet solution will make your business more profitable. If you’re not careful, all the bells
and whistles may actually detract from the business instead of improving it.
Does it make business simpler? Most technologies we see every day have some “gee-whiz” quality that makes
us want to have them. Personal digital assistants or PDAs, also known as palm devices, are a great example.
You see them everywhere. Yet some people use both a PDA and a day planner or business card holder. Did the
technology completely substitute for old ways of doing things?
To determine how a new technology will simplify your business, you must review your entire information
process. If, for example, your company began using an online quotation process, what steps in the original
process would it eliminate? If the Internet adds steps to filling out paperwork, it has not become simpler.
To streamline the business process, the world’s largest supplier of ready-mixed concrete, RMC Group PLC,
has been using BuildPoint.com to sell concrete to one of the largest concrete pumping subcontractors in the
United States, Conco of Concord, Calif. RMC and Conco expedite the negotiation process using requests for
quotes (RFQ)s and reduce time spent on administrative tasks and paperwork. Since last September, Conco has
sent out 22 RFQs and 5 Purchase Orders (POs). Conco can go online and configure the desired mixes from
among 140,000 different ones.
Inserting expensive and fast-changing technology into a process that does not streamline or make the
process more efficient is counterproductive. This is a common trap for many companies. The leading edge of
technology can quickly become the bleeding edge if not used properly.
Does it cost less? IT/IS systems cost money. In most cases, your business was already committed to spend-
ing a certain amount of money to accomplish the task in question. The vital element is not whether you spend
less now, but whether the new technology costs you less in the long run. The real question is how to reduce
the total cost involved with the task, which means detailing the entire process from a cost perspective.
Each step in the process has a certain cost attached. Summing those costs yields a total cost for the process.
It is similar to saving 25¢ per ton of sand but using an extra 1/4 sack of cement to produce the same workability. Sure,

© Integration of the
Internet into your business
strategy is a critical element
to profitability and success.
Ask these basic strategy
questions when considering
how to use the power of
the Internet.
Publication #J01B050 Copyright © 2001 Hanley-Wood, LLC All rights reserved
© Many Web sites instantly greet customers with their names, last purchases, and current
order status. absorption of the existing market, then it easier for your company internally, but
you spent less for the
sand, but the total
cost increased. The
same thing can hap-
pen with Internet
technologies such
as online automa-
tion of billing or
quotation.
Costs are asso-
ciated with imple-
menting your system
to perform this task
online. If the costs to run the entire system
have not decreased, did using the new
technology really help? This is a very fast
and powerful way to connect to customers,
but to integrate this type of technology
into the business for its own sake is not the
right decision. One factor to consider is
customer switching costs. If you provided
a system that is more customer-friendly
than your competitors’, why would your
customers want to do business the old way
with any of your competitors? Was this
value correctly evaluated in the total cost
of doing business? Did the new technology
take this into account?
How does it create wealth? Any time a
new idea, technology, or e-commerce solu-
tion is presented, ask how it will create
wealth for your business. Ask how the
solution will create a bigger market, i.e.,
make the pie bigger. Insert whichever
cliché you wish about the bottom line, but
there had better be an answer about how
this particular solution will generate more
wealth and profits. Remember also, greater
revenues do not necessarily translate into
greater profit.
How does it capture wealth? The second
half of the wealth question is how your
company gets a bigger piece of the local
building materials market. In some cases,
new Internet technologies are said to pro-
mote access to bigger and better markets. It
is no secret that most competition in the
industry occurs on a regional, if not local,
level. If the new Internet solution does not
provide more information, access, or
probably isn’t the right solution at all.
Also, a single extra sale might make a
short-term difference, but long-term reten-
tion of new customers should be the goal.
This means that whichever solution is
selected, you must consider whether it will
get you a bigger piece of the pie.
Customer fund amentals
If you’ve convinced yourself that your
answers to the preceding four questions
are positive, look at this issue from anoth-
er point of view. Customers are the reason
you are in business. We all know what
happens if you do not have customers.
When implementing new Internet tech-
nologies into your business, you should
consider the following four key points,
which customers will notice.
Don’t waste their time! The customer’s
time, like yours, is money. Many compa-
nies have launched Web sites and
promised functionality. Don’t forget, your
customers are in business too. When you
present them with your brand new IT
solution, they will be asking the same four
business questions about their businesses
as above. Consider those from your cus-
tomer’s point of view.
Remember who they are, regardless of
size. Every customer wants to feel like your
most important customer. Everyone in the
office knows the names and faces of the
big customers. What about the smaller
ones? The width and breadth of Internet
solutions can provide the means to recog-
nize every customer’s phone number or
account number. Salespeople and order
takers have a tremendous amount of infor-
mation available. By using this informa-
tion and personalizing every contact and
transaction a customer has with your com-
pany, you have another method to differ-
entiate you from your competitors.
Make it easier for customers to order and
get service. With the introduction of
online ordering, the buying process will
never be the same. However, don’t forget
strategy question No. 1, “Does it make
business simpler?” Integrating a new
Internet solution may make the process
what about what the customer sees? Was
the goal of the process to make things
easier for you or your customer? In some
cases it almost serves you best to work
backward from the answer. In other
words, ask yourself, “What are my cus-
tomers’ needs, and how can I meet them
with an online offering?”
Mike Leathers, director of sales and
marketing for Hanson Concrete South
Central, saw the Internet as an excellent
method to extend the company’s electron-
ic reach to manual trading partners. He
says pilot programs including real-time
delivery notice and online invoicing to
customers have gone a long way in giving
his customers added value. By starting
small, Leathers says he thinks the company
can move beyond an e-commerce (elec-
tronic commerce) solution and provide c-
commerce (collaborative commerce).
Customize products and services for
them. Not only do all customers want to
feel important, but they also want to
receive personalized service. You know
some of your customers are interested in
new material technologies. Does your
Web site or mail server provide updates
on new material or product technologies
for those particular customers, or do you
still use mass mailings? Many Web sites
instantly greet customers with their
names, last purchases, and current order
status. The Internet provides a means to
treat every customer uniquely.
These fundamental business and cus-
tomer strategies are necessary to deploy
the power of the Internet to your advan-
tage. It’s not that these timeless concepts
have changed—now they just have a new
technology twist.
Dr. Richard S. Szecsy of Houston
is president and CEO of Advanced
Engineering Solutions, which specializes in
new technology application and development
in ready-mixed concrete.
References
1. R. Binsacca, “Ready or Not,” ProSales,
Hanley-Wood, LLC, April 2000, pp. 44-50.
2. P. Seybold and R. Marshak, Customers.com.
Times Books, 1998.