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Asia Perspective: Role of IT in Business

A PERSPECTIVE FROM ASIA

I walked by a small florist in my office building, run by a young couple, and their business is not only computerized in terms of accounts and inventory control, but it also extends their IT-savvy to enabling orders across the Internet. Mind you, they are not just having a simple “billboard” Web site, but they have full credit-card processing facility as well.

Contrast that to a midsized manufacturing company with turnover of over US$20 million, still struggling with antiquated accounting software running on a near-obsolete operating system and very old hardware, and no Internet email for individual employees, and you see the disparity not just in terms of implementation of IT in business, but the owner/management mindset as well.

So then, what should IT mean to businesses in Asia, in terms of gaining competitiveness, profitability, and operational longevity?

The Business Leveler

Traditionally, information technology as a platform was only accessible to large multinational corporations, when room-sized mainframes ruled the day. Back then, big businesses, through the use of information technology, stretched the competitive barrier further away from much smaller businesses, and a wide chasm between large powerful and profitable businesses and small businesses only grew wider.

Today, however, high-performance computing and wide bandwidth has become very accessible to even sole proprietorships, using consumerized technologies. With this availability and low costs, the chasm of competitiveness between very large monolithic businesses and small businesses have closed drastically. Small businesses can establish equally credible online presences as large businesses, often without the overheads and bureaucracy of large businesses.

In fact, many larger businesses are today breaking up into smaller operating units or subsidiaries, to attempt to become as competitive as small businesses. And in Asia, that is becoming more evident, since many Asian businesses are small and medium-sized businesses, often with owners still operating as managers.

Dealing With Costs

In Asia, some of the pressing IT concerns for small and growing businesses include the integration of legacy and Web-based platforms, migration from legacy to modern platforms, data and network security, convergence, as well as the perennial struggle of small businesses — price tags.

For many medium-sized businesses, especially those with legacy information stored on proprietary and even obsolete platforms and applications, one of the key challenges is trying to either find functional and affordable middleware that can “marry” those legacy platforms, applications and data, to be compatible with a modernized Web front end. For many such businesses, finding a consultant or application developer that can help to migrate or integrate, at a decent cost, is not easy indeed.

Second, although more and more growing businesses have adopted the use of the Internet for basic connectivity and “billboard” Web presence, not many in Asia have taken the serious path to ensure that their gateway, servers, user nodes, applications, operating environments, data, are secure. The rising security threats from malware, such as Trojans and worms, coupled with the ever-invading spam (sometimes as a launching pad for malware), can only mean that businesses ought to take security challenges as a necessary corporate and competitive strategy, rather than a “good to have.”

Although there are more telecommunication providers today, with IDD charges coming down quite a bit compared to previous years, these charges can still impact the bottom line and balance sheets for small and growing businesses. Therefore, there is a trend for small and growing businesses to adopt convergence technologies, including the likes of voiceover Internet Protocol (VoIP) and instant messaging (MSN, ICQ, AIM, iChat, and Skype). Such technologies are empowering smaller businesses, although admittedly, eating into the bottom line of large regional and international telecommunication providers providing traditional phone services.

Any Discount?

If you have done business in Asia, you might have noticed a consistent trend — the desire to have discounts. Discounts are sought not just at street-side stalls selling cheap goods, but also in boardrooms between large corporations and IT suppliers.

The reason is simple — there are lots of choices of IT technologies these days, and business competition is keen. At the other end of the spectrum, open-source technology, which is available for free, is invading the traditional turf of many enterprise and client-side applications and technologies.

By Seamus Phan
Seamus Phan, based in Singapore,
is one of Asia’s leading thinkers and practitioners
in business leadership, Internet security, and marketing.

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