Creating virtual values. (challenges of emerging networked economy)

The "networked economy" challenges us to find new ways to deliver value to customers

If you have ever used a telephone banking service, ordered a pay-per-view movie or checked your e-mail, you have availed yourself of a traditional service in a fundamentally different way than you would have just a few years ago. The element missing from these transactions was that of "place"; in other words, you didn't have to go to a bank, a video store or a post office to obtain access to the service. But there is more: Technology has not merely moved the point of access from a storefront to your home or office; instead, access has been channelled through digital devices found in multiple locations - namely, telephones, television sets and personal computers - enabling consumers to use services practically anywhere at any time. Access has not really moved from place to place - it has moved from a place to "space."

Information technologies have laid the foundation for a new market environment many call the "networked economy." A growing proportion of our economy is shifting from the physical marketplace we know to this networked economy, or electronic "marketspace," we are just beginning to explore.

How will new technologies associated with the networked economy be incorporated into the traditional relationship between businesses and their customers? What impact will the networked economy have on the way customers are listened to, marketed to and ultimately served? These are only some of the pressing business questions companies are asking. When information technology was merely a tool used to automate operations such as payroll or accounting, it was relatively easy to understand. Now that technology is defining new markets, it must be understood in its proper context as a strategic management tool that needs to be correctly leveraged.

This article will outline the dynamics of a networked economy, describe its effects on customer processes, and explore how some companies have leveraged these effects for …