Introduction to the Symposium E-Commerce and Global Business: The Impact of the Information and Communication Technology
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E-Commerce
The and
to
Impact
of
the
Symposium
Global
Business:
the
Information
Communication
Revolution
on
the
Technology Conduct of
International
Business Jose de la Torre*
ANDERSONSCHOOLOF MANAGEMENT, UNIVERSITYOF CALIFORNIA,LOS ANGELES
Richard W. Moxon** UNIVERSITYOF WASHINGTONBUSINESSSCHOOL
M
ore than $2 trillion was spent worldwide in information and communication technology (ICT) industries in the year 2000, and it has been estimated that these expenditures had been growing at about 8% annually during the 1990s, or more than twice the rate of the global economy.l As a result, there has been considerable speculation, in both the business and academic press, regarding how the ICT revolution shrinks distances, eliminates intermediaries, and brings about closer integration of the world economy. A corollary of this is the implication that the conduct of
global business will be changed in fundamental ways. During the Internet euphoria that prevailed at the time we held our conference on May 17-19, 2000, ICT advances were forecast to transform world business by linking suppliers, firms and customers in a seamless web that would cover the entire world. It would be the "end of geography" according to many, a state of development that would lead to: * infinitely responsive and elastic supply chains that included the most efficient firms at every step of
*Professor of international business strategy and founding director of UCLA's Center for International Business Education and Research. His recent interests include multinational corporate reaction to regional market liberalization and the management of collaborative agreements. **Professoremeritus of strategyand international business and founding director of CIBERat the University of Washington. His research interests include offshore manufacturing,FDI in developing countries and international negotiations. JOURNAL OF INTERNATIONALBUSINESSSTUDIES, 32, 4 (FOURTHQUARTER2001):
617-639
617
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E-COMMERCEAND GLOBAL BUSINESS
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value added, and that could be instantaneously constructed or deconstructed for each product or process as conditions warranted; an international distribution of value-added activities that matched the relative competitive advantage of each geographic location, thus assuring global diffusion of the benefits of globalization (as long as the facilitating IC technologies were locally available);2 immediate delivery and superb service to customers in any part of the globe, coordinated by specialized fulfillment companies and virtual service teams; rapid and accurate product development, the result of combining extensive databases on customer preferences with specialized producers, and the ability to simulate market conditions and test prototypes globally and cheaply; mass customization of products and services, specifically tailored to different culture
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