RealTime IT News

European E-Business Neglects Traditional Virtues, Say Consultants

[London, ENGLAND] Many large European companies are rushing headlong into e-business projects without proper justification, American Management Systems (AMS) warned in a report published Wednesday.

AMS, an international business and IT consultancy, interviewed 131 senior managers in European companies and found most of them were disappointed with the outcome of their e-business initiatives. Just 14 percent judged their projects to have been "very successful."

Nick Rowley, vice president of AMS in Europe, said companies were spending millions of euros to establish themselves online, yet there was no careful planning or any application of the metrics normally applied to offline projects of similar value.

"Aggressive marketing from e-business vendors, general market hype and shareholder pressure are all forcing the pace," said Rowley.

The AMS research was conducted among companies operating in manufacturing, banking, consumer and business services organizations in the U.K., Germany, France, Italy, Spain, Benelux and Scandinavia.

Amazingly, one of the chief weaknesses of the European approach to e-business is the failure to measure the results of their projects. Less than one manager in five was able to confirm that results were being properly measured.

Nor are European managers always inclined to prepare a full business case before investing in an e-business project. In fact, 49 percent admitted they did not prepare a case, while of those who did, only 50 percent used any objective measurement to show how a project's outcome stacked up against the time, staffing and resources put into it.

Usually, the high expectations riding on investment in new technology cause problems when the outcome fails to fulfil them. This may not hold true in European e-business, however, as AMP points out that 11 percent of managers were not expecting any return whatsoever.

The survey confirms what other observers have long thought -- that many of the efforts of bricks and mortar companies to put their businesses online are doomed to failure. What is astonishing, however, is that some of them do not even seem to mind.

Readers can access the full report on the AMS Web site.