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    Clearing the Data Smog


    © International Trade Centre, International Trade Forum - Issue 1/2004

    Digital technology is a major, often unacknowledged, force in development. With the burst of the dot.com bubble behind, small firms and Asian countries are now poised to take advantage of new technologies. An overload of information, however, remains a major block to using technology for business intelligence.

    Technology leaders are convinced of the power of "e" to contribute to development. "Information technology is a major educational and economic engine," says John Chambers, Head of Cisco Systems, which supplies networking equipment and network management for the Internet. His company last year joined in the launch of an educational initiative in Jordan uniting two dozen global businesses that are part of the World Economic Forum. Cisco sees the effort as an extension of its Networking Academy Programme which presently serves 400,000 students in 150 countries.

    Increased productivity

    New technologies increase productivity, Chambers notes, pointing out that United States statistics show "a direct correlation between the percentage of capital expenditures on information technology and prod-uctivity increases." And not just for the US: "If you look at these two correlations over time, without exception, they are occurring on a global basis.

    "In Hungary, for example, where the economy has been one of the fastest-growing in central Europe for a decade, technology enterprises account for a quarter of the country's industrial output," the Cisco boss observes.

    He adds: "Information technology can also help expand the reach of small businesses. Technology leveraged by the Rural Women's Association Project, for example, has enabled women raising high-quality chickens in a poor area in Northern Province, South Africa to find customers in nearby higher-income communities."

    Digital e-volution

    But are the benefits being oversold? Since the bursting of the dot.com bubble, many industry-watchers and investors are cautious about overestimating the speed and magnitude of digital e-volution. Michael D. Fleisher, Chairman, President and Chief Executive Officer (CEO) of Gartner Inc., a US-based research and advisory firm, identifies a "hype-disillusion-recovery cycle" in technology-driven business phenomena. "We are at the top of the hype cycle (for information technology offshore outsourcing)," he says. What follows the trough of disillusionment, however, is not collapse. There is a modest yet stable recovery based on best practices.

    Asia comes online

    The "New Economy" (the Internet and complementary telecommunications technology) may have reached this mature stage. A "small, vibrant community of start-ups" is poised to take advantage of an economic upturn in 2004, suggests Bruce Claflin, President and CEO of the US-based 3M Corporation. E-commerce, both business-to-business (B2B) and business-to-consumer (B2C), will soon explode, predicts Paul Sagan, President of Akamai Technologies in the United States. "We will see the rise of Asia online," he added in a discussion at the World Economic Forum's Annual Meeting. André Kudelski, President and CEO of the Kudelski Group in Switzerland, commented: "We've emerged from the bubble to reality."

    Waste information

    But quantity, either in access or information, does not necessarily engender better quality. Studies show that 95% of the data in corporate databases is never touched, notes Bernard Liautaud, Chairman of the Board and CEO of Business Objects, a France-based consultancy. "The corporate world is very much in the Stone Age," he observed. "There is a lot to do before companies move from exploiting data to creating true business intelligence." Anders Igel, President of TeliaSonera, a Swedish telecommunications company, adds: "Overload means stress, if you are not in control of your information. The problem is not technology - we have more than we need. The real effort is in how you put the pieces together."

    Closing the digital divide

    Programmes that provide information access to African villages and Mexican schools were cited as examples of ways in which the digitally underprivileged are now closing the gap. The latest Network Readiness Index shows seven Asian countries breaking into the top half of this ranking, reports Soumitra Dutta, Professor and Dean of Executive Education at France's European Institute of Business Administration (INSEAD). In the case of blogs (the new trend for individuals to share ideas and experiences via the Internet on Weblog sites), English may rank first by a large margin, but the second and third most common languages for content are Portuguese and Farsi, according to the National Institute for Technology and Liberal Education, a US-based non-profit organization.

    ITC helps developing countries put "e" to work

    ITC works with partners around the world to raise awareness, build knowledge and create competence on how to use information technology to benefit trade in developing and transition economies.

    Its recent CD-ROM, The Changing Marketplace: Putting "E" to Work, contains a wealth of information to help exporters and strategy-makers identify how they can put "e" to work to become more efficient:
    • Over 70 Trade Forum articles on e-trade issues, published in three languages.
    • Full text of ITC's Executive Forum publication, Export Development in the Digital Economy.
    • Complete descriptions of ITC's books on e-trade and how to obtain them.
    • A summary of ITC's work on e-trade and links to related web sites of other organizations.
    • Extensive information about ITC's E-trade Bridge programme and its "Winning with the Web" case studies (in English only).
    Copies are free for official trade-related institutions. To order, contact itcreg@intracen.org

    RelatedTrade Forum issues
    • Several magazine issues have been dedicated to the role of information technology in improving competitiveness. See the latest such issue, The Changing Marketplace:Putting "E" to Work, review past articles on the CD-ROM (of the same name), or consult the magazine's online search function, at http://www.tradeforum.org

    Prema de Sousa, Trade Forum's Contributing Editor, wrote this box.

    A former correspondent for the Financial Times, São Paulo-based journalist and writer Bill Hinchberger is Editor and Publisher of BrazilMax: http://www.BrazilMax.com

    Peter Hulm also contributed to this article.