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Newsletter - May 17, 2002

MOBILE COMMERCE: CUTTING LOOSE

 

By Glover T. Ferguson and Thomas H. Pike

 

The buzz today may be about cell phones and PDAs that connect to the Internet. In fact, a much more sweeping change is under way—the emergence of seamless, continuous economic interaction. Call it uCommerce: ubiquitous, untethered, unbounded.

 

You've got to sympathize with executives these days. Just when they thought they were getting their arms around eCommerce, someone came along and said things were about to change—again. The new challenge, they were warned, was to figure out what to do about mCommerce.

 

Of course, just about everyone is aware of the explosive growth in the use of cell phones and other handheld devices that underpin mobile commerce. But CEOs around the world are right to wonder if there is anything here beyond the hype that promises consumers they can operate vending machines with their cell phones or trade stocks while jogging. They want to know what mCommerce means for their businesses and how urgent it is to embrace this latest technology-driven change.

 

We believe that mobile commerce is simply the next step-albeit a very big step-toward something even more encompassing: universal, everyday, around-the-clock interconnectivity. The buzz today may be about cell phones and personal digital assistants that can connect to the Internet. In fact, a much more sweeping change is under way-the emergence of a world of seamless, continuous economic and social interaction.

 

What we are seeing is the dawn of uCommerce—commerce that is:

 

Ubiquitous—taking place everywhere, at all times;

 

Untethered—not constrained by the lines and hard wires of traditional computing and telephony;

 

Unbounded—no longer limited to the traditional definition of commerce.

 

Not just a matter of transactions, uCommerce encompasses the flow of information between a business and its employees, supply chain partners, customers and various smart appliances in ways that will either save money or generate new revenue.

 

Business leaders focused today on eCommerce or even mCommerce should look further out on the horizon, preparing in addition for the challenges and opportunities of uCommerce. Ultimately, they need to think of uCommerce as an "and," not an "or." It should not be seen as a replacement for eCommerce, mCommerce, or bricks and mortar. A more likely scenario is that it will be a fusion of all three, with people moving seamlessly from one to the other, depending on their location and the nature of the need.

 

Moving into uCommerce is not a replacement for anything your company is doing today, but an extension of it. And it will be mandatory, not optional.

 

In this world, people will be connected to one another, and to the Web, in a variety of ways that we can only begin to imagine. Along with computers and handheld devices, we may use our televisions, video games and automobile consoles—giving us "tCommerce," "vCommerce" and "aCommerce."

 

We will be connected faster, more continuously, and without the constraints of space and time that limit today's desktop devices. A cell phone, for example, could be an always-on Internet connection, used as a mobile device when the person is traveling, or hooked into a terminal at home or the office.

 

Objects also will communicate with one another or with people, transmitting information about their location and status, or taking action and even doing business on people's behalf. An appliance or automobile, for example, will sense impending mechanical problems and schedule maintenance; personal-finance robots will make market transactions automatically according to preprogrammed guidelines.

 

Driving forces


This isn't science fiction. uCommerce will play a major role in our work and lives because it is consistent with drivers of behavior that are already at work.

 

Mobility


Individual consumers already approach their lives in general with a kind of fast-food mentality. In developed countries, people multitask, using time spent in the car, online or on the street not only to eat but to read or talk as well. Making purchases on the go is a logical extension.

 

Similarly, in business, employees at all levels are on the move. Today's employee doesn't work just at the office—and indeed may not even have an office. Work gets done at home, in the car, at the customer or client location, or in any available cubicle. The efficiency and productivity of all those individuals can be improved by any of a number of portable devices.

Once connectivity and Internet access are no longer limited to the personal computer, they will become available to people who were never deskbound, like doctors, teachers, electricians and farmers. The opportunity to reach and serve such people at virtually any time opens up new business opportunities.

 

  Service


The explosion of computing power has enabled businesses to personalize their products and services based on what they have learned about their customers; therefore, businesses can offer those customers a higher level of service.

With cell phones, PDAs or even more futuristic forms of ubiquitous access that we can't yet imagine,   that capability is increased because the customer can, in effect, be anywhere. Several automakers, for example, already offer drivers a variety of personal assistance and services, often based on the geographic position and status of their vehicle at that moment. As access becomes continuous, customer expectations for continuous personal service are likely to increase accordingly.

 

Lower-cost access


Phones, pagers and PDAs cost less than computers. In the consumer realm, that means Internet access is becoming available even to people whose lifestyle or financial situation would keep them from buying a computer.

 

This has important implications for the so-called digital divide that exists not only within the economies of wealthy developed countries, where many citizens still do not have computers, but also between the developed and developing worlds. Low-cost access could greatly boost Internet use in countries like China and Brazil, where cell phone use is becoming relatively common.

 

Within businesses, mobile devices can help control the cost of extending intranet or Internet access. Currently, the cost of computers and networks is the fastest growing component of information technology expenses. Mobile devices also can contribute to greater overall employee productivity.

 

Bumps in the road


To be sure, uCommerce will not burst upon the scene full-blown tomorrow. Like all new technologies, mCommerce and uCommerce still have obstacles to overcome.

 

Absence of clear standards


Unlike Europe, which has consolidated largely around a single frequency and signaling protocol, the United States has phones supporting three different standards to enable communications in various regions of the country. This problem isn't likely to be solved through either government mandate or competitor consensus, so the "winner" will likely be whichever standard can achieve a dominant share first.

 

Another possibility is that no standard will win. The problem simply may be overpowered with layers of technology, just as browsers can handle XML, HTML and Java.

 

Limitations of current handheld devices


Web access just isn't the same on a screen not much bigger than a business card, and inputting data can be hard on a cell phone pad. Voice-recognition technology is improving but is still imperfect. Meanwhile, compact keyboards that attach to mobile devices (such as PDAs) exist today; holographic projection screens are under development.

 

Such advances would make mobile devices more user-friendly. But the eventual solution still is likely to be an integrated network of multiple devices, with the user choosing whichever is appropriate to the need at the moment.

 

Need for back-office systems


Here is an often-cited scenario: A person is walking down the street, decides to get something to eat and-using a mobile device—checks out local restaurants, gets directions to the restaurant of choice, has a meal and pays the bill.

 

It sounds good, but the systems to make this happen are not yet in place.

 

Imagine the billing and settlement process. Many parties contributed to getting our customer fed: the portal that carried the restaurant information, the carrier that calculated the customer's proximity to the restaurant and provided directions, the restaurant itself and the company that provided the mechanism for payment. All deserve a cut-but who does the calculation and distribution, and how?

 

There are other pitfalls. Payment systems are still vulnerable to hackers when data is sent via mobile devices. Privacy is also a concern. Before long, every cell phone will come with GPS (global positioning system). That's exciting for marketers, but customers are skittish about unwanted intrusions and the feeling of being followed.

 

Lack of killer apps


It was e-mail that made Internet access a must-have. To date, no comparable killer mCommerce application has emerged on a global level.

 

In the business-to-consumer realm, I-Mode has caught the fancy of the Japanese, especially teens. I-Mode offers users communication (phone, e-mail); dozens of services, from the practical (ticket booking, recipes) to the recreational (games, karaoke); plus several whimsical options for standby screen displays. More than 13 million subscribers have signed on in Japan, but I-Mode hasn't caught on outside the country. Nothing like it has emerged in Europe or the United States, though some speculate that short messaging may fill that role

.

Cultural and regional differences


Europe is ahead of the United States in adopting mCommerce, in part because European mobile phone users do not pay for incoming calls. As a result, they are more willing than Americans to leave their phones on. Streaming information and services to a user's mobile device, therefore, is more likely to be successful in Europe than in the United States.

 

Another regional difference is the extent to which mobile devices are the primary means of Internet access rather than being an adjunct to computer-based access. Today more than 41 percent of US households have access to the Internet via in-home computers; that figure is 27 percent in Japan and much lower in many parts of Europe.

 

Finally, the widespread use of mobile devices in Japan may be partly a result of the country's commuting patterns. The typical Japanese commutes 54 minutes per day, primarily by train, which allows ample time and opportunity to work or play on a mobile device. In contrast, 70 percent of US commuters spend less than 30 minutes per day in transit, and 87 percent of all commutes are by car.

 

These obstacles will slow the arrival of uCommerce and make its rate of adoption uneven around the world. But they will not stop it.

 

First steps


What will uCommerce mean for your business? What opportunities does it offer? We can only give that dreaded consultants' answer: "It depends."

 

It does depend-on your company's geography, industry and specific situation. uCommerce may become a necessity either because your customers demand it or because it is key to maintaining a competitive business system. Or it may offer opportunities to fundamentally transform your business model.

 

But at this early stage of this—or any—technology's development and implementation, it is hard to know the answers with any certainty. The challenge for a business leader is to anticipate what uCommerce might mean by starting to ask the right questions now.

Can uCommerce help you build a new, durable relationship with customers? Think about:

 

Moments of value


The mobile aspect of uCommerce means that you can be with the customer at the moment of need. What could it mean for your business to be in almost continuous contact with customers? To allow customers to access information on their own from anywhere at any hour? To make purchases or transactions any time that buyers decide they want something?

 

Product to service


Can uCommerce help your customers not just buy your product but use it successfully? Can you, for example, train your customers how to get full value from the product? Help customers anticipate or avoid problems?

 

Discrete to continuous


Can the technologies underlying uCommerce help you repackage or reprice your product? Can you offer the product or service in smaller increments? Vary the pricing structure by number of units, time of day, location of usage or some other dimension?

Can uCommerce create a new way of doing your business? Think about:

 

The flow of information


In politics, a common piece of advice is "Follow the money." Here the challenge is to follow the flow of information.

 

What kind of information moves among employees, and how does it move? Along the supply chain? To suppliers, customers, partners? How could those flows of information be shortened, sped up, rerouted or eliminated if people could communicate instantly at any hour? If people could "talk" to objects, or if objects could communicate with one another?

 

Location, location, location


Mobile technology offers an unprecedented ability to know where someone or something is at any given moment. Suppose your employees were always in touch? Had continuous access to company data and resources? What if you could track your purchases, inventory or shipments minute to minute? If you could pinpoint your customers? How could this knowledge change the way you operate?

 

Answers to these questions will vary from company to company, of course, and visions of the uCommerce future will differ. Nonetheless, all business leaders should take the fundamental first steps now.

 

Get a handle on the technology


Nothing can replace firsthand experience with the advantages and limitations of today's leading-edge devices and applications. Reading about other applications of this emerging technology (such as tagging devices) can help round out your understanding of what it can bring.

 

Team up on research


Why go through the learning process alone? In the early stages, team up with other companies, even potential competitors, to jointly research usage and preference patterns around a suite of applications. Share the results, then separate and enter the marketplace as competitors, partners or allies-as the situation warrants.

 

Grab the low-hanging fruit

 

At the corporate level, start smart. Pick some uCommerce applications that have the potential to be profitable; these will certainly be learning experiences. Some applications (particularly in business to business) offer such immediate and high payback that any risk of choosing the "wrong" standard or technology is minimal. Treat these applications as pilot projects. Rather than setting high profitability goals, use them as ways to learn how the technology really works, how people really use it.

 

The technological revolution of the past decade has brought profound changes in our working and private lives and surging productivity for many businesses. As eCommerce is transformed into mCommerce, and as uCommerce looms on the horizon, it's clear that this revolution is far from over

 

Glover Ferguson, chief scientist for Accenture, leads the firm's global research strategy. He oversees the technology research and development efforts taking place at Accenture Technology Labs - Research in Chicago; Palo Alto, California; and Sophia Antipolis in France. Mr. Ferguson is co-director of the Accenture uCommerce Program, responsible for shaping the firm's strategy for realizing the benefits of eCommerce for its clients. He is based in Chicago, Illinois

 

glover.t.ferguson@accenture.com

 

Thomas Pike
is the managing partner of the Accenture Growth & Strategy practice. Throughout his career, Mr. Pike has led a wide variety of projects involving information and information technology, from strategy development through implementation. Mr. Pike, one of the firm's eCommerce experts, is a frequent speaker to global audiences on the future of the Internet and mobile commerce. He is based in New York

 

Thomas.h.pike@accenture.com

 

 

SRS-WORLDHOTELS TARGETS CHINA WITH SALES BLITZ

SRS-WORLDHOTELS, one of the world’s leading and most dynamic hotel marketing and representation consortia, is organizing a high profile sales blitz in China’s two key cities, Beijing and Shanghai on behalf of its more than 400 member hotels worldwide.

Senior executives from SRS-WORLDHOTELS’ Asia Pacific member hotels will meet with leading travel trade professionals, corporate travellers and members of the press in events taking place in the two cities. The SRS-WORLDHOTELS annual regional conference will also be held simultaneously at The Presidential Plaza Beijing, the newest member of SRS-WORLDHOTELS’ Deluxe Collection and the first hotel in China to be admitted to this prestigious group.

Highlights of the roadshow will be a cocktail presentation followed by dinner for the travel trade at the Presidential Plaza Beijing on Friday 24 May, and a similar event to be held at The American Club in Shanghai on Tuesday 28 May. Around 100 local travel industry representatives are expected to attend each of the two events. Lucky draw contests will also be held with the chance to win great prizes including accommodation and car rental.

Joining the roadshow will be senior executives from SRS-WORLDHOTELS members Bali Hilton International, Banyan Tree Maldives, Vabbinfaru, Beijing Landmark Towers, Evergreen International Hotels, Hotel Lotte World, Metropark Hotel and Presidential Plaza Beijing. The hotel guests will also be partnered by representatives from Hertz Rent-A-Car and Abacus, the leading GDS system in China, who will at both events give a demonstration of how to make real-time online bookings of cars and hotels through the GDS system.

"We see the China market as one of great long-term significance for SRS-WORLDHOTELS members, and we feel that now is the right time to step up our marketing efforts in China," said Roland Jegge, Vice President Asia/Pacific of SRS-WORLDHOTELS.

Details of the two events are as follows:

Beijing Shanghai

Date: 24 May, 2002 Date: 28 May, 2002

Time: 6.30pm cocktail, 7.15pm dinner Time: 6.00pm cocktail, 6.45pm dinner

Venue: Presidential Plaza Beijing Venue: Shanghai American Club

Currently, SRS-WORLDHOTELS has more than 400 member hotels in its portfolio, representing over 70,000 rooms in 65 countries and 250 destinations worldwide. It is the only hotel marketing and representation group with three distinct membership categories: the exclusive Deluxe Collection, the First Class Collection and the Comfort Collection. SRS-WORDLHOTELS’ Asia/Pacific operation has grown dramatically to 20 staff in four offices around the region and the company has over 50 properties in Asia/Pacific.

SRS-WORLDHOTELS - Asia Pacific
Mr Roland Jegge     E-mail: rjegge@srs-worldhotels.com

MERIDIEN TO SELL SIX EX-PRINCIPALS

e-Tid.com  -  Le Meridien is selling sell six former Principal Hotels in advance of a £250m investment programme which includes rebranding seven other Principals and spending £70m turing the Cumberland into the UK’s first all Art + Tech hotel.

Tony Troy, regional MD for UK and Ireland, said the six did not meet ‘core brand specifications’ although they are operating at a profit.

The hotels are: Norbreck Castle, Blackpool; The Queen Hotel, Chester; Manor House Hotel, Moretonhampstead; Keswick Hotel, Keswick; North Stafford Hotel, Stoke-on-Trent and the Golf Hotel, Lincoln.

Le Meridien is owned by Nomura. The Japanese bank bought Principal Hotels for £255m at the start of 2001 while the 120-strong Meridien chain was picked up for £1.9bn from Compass in May. Twelve of the hotels were immediately sold to and leased back from the Royal Bank of Scotland.

THE SECRET OF FOOD DESIGN: FOLLOW THE FLOW OF FOOD

By  Lee Simon  The General Group

To kick off this column, I thought I would start by giving away the biggest, baddest secret to successful kitchen design.  All right, it is right there in the title, but it is certainly worth repeating … follow the flow of food.  By this, I mean that the facility should be designed to handle the events that occur as part of food preparation in sequential order.  It sounds simple, but you would be surprised to learn how many foodservice facilities (independent and chain establishments alike) are designed without keeping this key principle in mind.  Now, let’s look at how this concept is applied to the design of a kitchen.

One of the best ways to consider this approach is to identify a menu item and track its preparation methods.  As an example, I will track the production methods for a grilled chicken breast sandwich.  The first thing that occurs in the preparation of our sandwich is the delivery of the raw products.  Located near the receiving door should be a dedicated receiving area so that the food products can be weighed and checked for quality.  Once the product is accepted, it will have to be stored – the chicken in the cooler or freezer, the condiments and bread in dry storage.  Already, through this example, we have established that the receiving and storage areas have a critical relationship and should be located adjacent to one another.  In a typical design, it would be counterproductive to locate the receiving and storage areas on opposite sides of the facility.

Next, the chicken may have to be thawed, marinated, tenderized, trimmed, etc., depending on the state of the purchased product and desired preparation methods.  Bottom line … the chicken will require preparation work.  Our exercise now reveals that the preparation area should be adjacent to the refrigerated and frozen storage areas.  Once this work is completed, the chicken can go in one of two directions: back to refrigerated storage for later use or to the hot production area for cooking.  You can see that our flow patterns are developing.  The preparation area, if located in between the hot production and refrigerated storage areas will support both immediate and long-term production needs.

Continuing our exploration, let’s assume that the chicken is grilled and the sandwich is assembled, dressed, and sides are provided in the hot production area.  The sandwich, now ready to be served to the patron, is picked up by the server.  Thus, the design of the pick-up area and its interface with hot (and cold in the case of other menu items) production is critical.  The server should be able to get in and out of the kitchen without disrupting the cooking staff – a separation should exist by design so that the servers and cooks do not hinder one another’s efforts.

Your famous grilled chicken sandwich with 111 herbs and spices (take that colonel) is served and enjoyed by one and all.  Now the table is cleared and all wares are dropped off in the ware washing area.  The ware washing area, a key component of any kitchen operation, must be strategically located.  With both the service staff and the kitchen staff requiring access, there are several critical relationships to consider when locating ware washing.

Ideally, the flow patterns of the service staff and kitchen staff should meet at the food pick-up and soiled drop-off areas, but should never cross.  The servers require access to the pick-up and drop-off areas, the service and beverage areas, and the dining room.  Likewise, the kitchen staff needs to have access to the storage, preparation, cooking, pick-up, and ware washing areas.  Separation of the service and kitchen staff allows your employees to complete their tasks without the interruption that occurs when they are constantly bumping into one another.  Additionally, when the service and kitchen employees cross paths, accidents, delayed service, and a greater potential for cross contamination and foodborne illness result. 

Take a moment to review your facility and operation.  Does your facility accommodate critical relationships established by the flow of food?  Or, do your servers have to walk through the prep or production areas to access the ware washing area?  Are your servers and kitchen employees able to move freely?  Or, are they always engaged in “right of way” debates?  When a facility is designed based on the flow of food, the quality of service, risk of cross contamination, and employee morale all improve.  If your facility utilizes this approach to design, you can attest to the results.  If not, consider how you can improve the current configuration or operational procedures to better follow the flow of food. \

Lee Simon is an award winning foodservice designer with The General Group.  Lee also is an adjunct lecturer, teaching Hospitality Facilities Planning and Design at the University of Central Florida's Rosen School of Hospitality Management

HSMAI ANNOUNCES EXECUTIVE THINK SESSION JUNE 24 ON GLOBAL WIRELESS DEVICES: ‘ CONNECTING TO THE CONSUMER ‘

Case Studies, Live Demos and Keynote Addresses Highlight the 
Full-day Program Preceding HITEC in Chicago 

Global wireless technology has enabled the world to reach and influence consumers farther, faster and cheaper than ever before.  The question confronting every hospitality and travel entity is:  How can hospitality and tourism executives use wireless technology to better and effectively market, develop and compete? 
        
With those realities and inevitabilities at the forefront of businesses today, the Hospitality Sales & Marketing Association International (HSMAI) is dedicating the next Executive THINK (Travel & Hospitality Innovation, Network, Knowledge) to a study of Global Wireless Devices: Connecting to the Consumer and its immediate and long-term impact on the hospitality, travel and tourism industry. 
        
The intensive one-day session (fourth in a series of Executive THINKs), to be presented Monday, June 24, 2002 from 8:30am to 5pm at the Swissotel Chicago, immediately preceding HITEC, unites high-level travel and hospitality executives with experts in the marketplace who will present the current and future state of wireless technology, as well as case studies and live demonstrations. 
        
Showcasing the latest developments in wireless applications, from handheld devices to wireless phones and new software applications, the forum will provide a venue for stimulating dialogue and exchanging ideas on the changing needs of consumers, and capital intensive requirements for selected wireless applications. 
        
Keynote speakers will be Leonard Fischer, “Technology Section” editor, USA Today, and Henry H. Hartevoldt, senior analyst, Forrester Research. 

This Executive THINK program will include key updates on the actual utilization of wireless applications by today’s consumers, as well as case studies and live demonstrations of state-of-the-art wireless products and applications from companies such as IBM, Nextel, Six Continents and Go To Systems. 
        
Facilitating the day’s program will be Dr. Lalia Rach, dean, Center for Hospitality, Tourism & Travel Administration, New York University Tisch Center. 
        
A networking reception will be held at the close of the session, from 5-6 pm. 
        
Attendees will receive a workbook of handouts and reference material on topics and issues covered during the session.  This invaluable take-away can be used for reference when researching ideas, strategies, and tactics that can be implemented in organizations or destinations. 
        
Registration is limited to qualified executives in hospitality, travel and tourism with a vice president equivalent or higher position.  For more information or to register online for the HSMAI Executive THINK “Global Wireless Devices: Connecting to the Consumer,” go to www.hsmai.org.  For sponsorship information, contact Bob Gilbert at bgilbert@hsmai.org or call (202) 789-0089. 
        
HSMAI is an international organization of sales and marketing professionals representing all segments of the hospitality industry. With a strong focus on education, HSMAI has become the industry champion in identifying and communicating trends in the hospitality industry, while operating as a leading voice for both hospitality and sales and marketing management disciplines.  Founded in 1927,   HSMAI is an individual membership organization comprising nearly 7,000 members from 35 countries and 60 chapters worldwide. 

HSMAI     www.hsmai.org

FORMER PRESIDENT AND BARBARA BUSH TO GIVE JOINT KEYNOTE ADDRESS TO NATIONAL RESTAURANT ASSOCIATION (U.S.) ON MAY 19

Former United States President George H.W. Bush and former First Lady Barbara Bush will honor the nation's restaurants for their extraordinary response to September 11 during the Industry Tribute and Keynote Address at the National Restaurant Association, Restaurant Hotel-Motel Show on Sunday, May 19, in Chicago.

Who:

Former United States President George H.W. Bush and former First Lady Barbara Bush

What:

The Bushes will give a joint keynote address at the National Restaurant Association's 2002 Restaurant, Hotel-Motel Show. Their speech follows an industry tribute that will honor and salute the nation's restaurants for their extraordinary response to September 11 including the efforts of Windows of Hope and Dine for America.

Where:

The National Restaurant Association Restaurant, Hotel-Motel Show, McCormick Place South, Grand Ballroom (S100), Chicago

When:

Sunday, May 19, 2 pm, (Doors open at 1:30 pm) Show attendees, exhibitors and registered media are welcome to attend.

Celebrating its 83rd year, the Association's annual Restaurant, Hotel-Motel Show is the largest single gathering of restaurant, foodservice and lodging professionals in North and South America. The show will be held May 18-21, at McCormick Place in Chicago. Each year, the Show attracts more than 2,000 exhibiting companies and 75,000 attendees and visitors from all 50 states and 100-plus countries. For the latest information, visit the Show Web site at www.restaurant.org/show.

The National Restaurant Association, founded in 1919, is the leading business association for the restaurant industry, which is comprised of 858,000 restaurant and foodservice outlets and a work force of 11.6 million employees making it the cornerstone of the economy, career opportunities and community involvement. Along with the National Restaurant Association Educational Foundation, the Association works to represent, educate and promote the rapidly growing industry. For more information, visit the Web site at www.restaurant.org.
http://www.usnewswire.com


CONTACT: Kristin Nolt, 202-331-5964, or Tom Foulkes, 202-331-5902 both of the National Restraurant Association;    
media@dineout.org

 

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