The ripple effects of Bin Laden's big rock hurled into our national pond of peace are seemingly endless. Many of these effects have been unpredictable in an increasingly Internet-enabled and wired world.
One short-term effect is the dramatic decline in business travel. Major furniture importers are relying more on e-mail, digital photos and indigenous quality control staff in Asia rather than risk an international incident in a Muslim land.
How unsavory has international travel, the lifeblood for many firms, become for this industry? Major furniture shows in the Philippines, Singapore, Malaysia and Indonesia in the first quarter will go a long way in telling us. Mid-year imports from places like Mexico and South America, will also offer evidence.
A longer-term effect will be the return to the home as haven, which has significant implications for e-business. People spending more time at home spend more money on it. And these people are logging bigger and bigger numbers online to do the research first.
Furniture companies will be increasingly asked to get information into the hands and PCs of consumers. How will companies respond? And how much information will they share?
Despite the scattering of dot-coms, business-to-consumer will be critical in 2002, but B2C will be about facilitating the purchase online or offline, wherever the consumer feels most comfortable buying. It will not be, nor has it ever been, exclusively about getting rid of salespeople and inventory and selling only online.
Bigger than B2C, and by huge margins, will be business-to-business, or the 90% of the Internet-powered business iceberg that is under the waterline. Amazon.com and FurnitureFind.com, for example, get their recognition above the waterline. Just underneath is by far the bulk of B2B, which Amazon.com and FurnitureFind.com have had to embrace to do what they do.
What about technology?
E-business is transforming the way business processes are done using Internet technologies. How will furniture companies in 2002 accomplish this, and how will they reassess their approaches to IT?
A related question is how much to outsource, or how much unbundling of the business is appropriate to enable focus on the core business? It's a huge question because, as the Harvard Business Review put it years ago, the way you link applications defines the way your company does business.
Ask the executive management team at Century how much their SAP implementation has changed their decision trees and the information upon which they are making both daily and big-picture decisions. Ask the same of Simmons since turning on its JD Edwards ERP system. What will your company do in terms of business processes to define the way you do business?
Major challenges in 2002 will continue to be the relative lack of skilled IT professionals. Can furniture companies — traditionally at the back of the hiring bus when it comes to technology workers — find the right people and enough of them?
Will the industry embrace open, XML-based standards for business transactions and their transmission? Each and every day other industries take steps forward in this regard. IBM has devoted an entire international division backed with millions in advertising and development to its success.
These are days other industries advance competitively vis-à-vis furniture. There is no silver bullet; progress is evolutionary not revolutionary. That means chipping away at solutions today. It means leveraging existing infrastructures.
FurnishNet is attempting to aggregate retailers and their vendors, with so far limited success. A small group of leading, NHFA card-carrying member retailers is looking hard at how to cut their supply chain costs via an Internet trade exchange. But the momentum for a pan-industry Internet hub, if it ever existed, is long gone.
In summary, Year 2K2 looks like a mixed bag. The refreshed focus on home and hearth gives what Bob Maricich, president at Century Furniture, calls the "best chance in my 30-year career to grab share back of what people spend on travel. It's a tremendous opportunity for us as an industry."
That leads to the biggest question of all. Is the furniture industry ready to capitalize on that opportunity or allow it slip by?
