Editorial: April 2003
The New Reality for Customer Engagement
For the management of Pepsi's two largest bottlers, a change was inevitable. Facing a growing, nationwide shift in tastes toward non-carbonated juices and bottled water, and the proliferation of new products, brand extensions and packaging innovations among its rivals, the two companies, PepsiAmericas Inc. and Pepsi Bottling Group Inc., were forced to rethink their go-to-market strategy. With dozens of new products to push, the old model, in which delivery drivers managed the process of restocking shelves in stores along their route, was breaking down, reports Executive Editor Marcia Stepanek and Reporters Debra D'Agostino and Anne Field in "The Pepsi Challenge." The solution: Decouple sales from delivery, and give the new salespeople the wireless tools necessary to leverage customer and market data to sell a more complex mix of beverages, and collect and relay to warehouses the critical real-time information about what stores need.
Change is inevitable, too, in the corporate use of mobile technologies. Unlike Pepsi, this month's CIO Insight survey suggests, the majority of companies have not yet developed clear strategic goals for these new technologies. Indeed, 55 percent of the CIOs we polled say they attribute their adoption of mobile technologies to employee demand for convenience rather than specific business imperatives. Meanwhile, respondents are deeply concerned about cost, security, the drain on sparse resources, and unproven ROI. Yet more than 80 percent say they plan to increase use of mobile technologieswhich might explain why wireless remains one of the few hopeful spots on the tech horizon in these dark days of spending cutbacks and economic uncertainty.
Nowhere is change more inevitable, and potentially more wrenching, than in corporate IT's move to a pay-as-you-go model for its computing needs. If, as Executive Editor Edward H. Baker reports in "The Simplicity Paradox," so-called utility computing has the potential to cut IT infrastructure costs by as much as 50 percent, then companies will be free to focus their efforts and resources on strategic technology initiatives. But the shift will bring with it significant challenges. Business processes will have to be upset yet again. Companies will have to reassess how they pay for IT. And unless CIOs can lead their companies into a world in which their power will no longer reside in how much they spend and what technologies they know about, but rather in their understanding of the strategic implications of this shift, their roles will shrivel.
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