What do you get when you combine high-speed communications, technological innovation, and the Internet? A new way of doing business, of course. We call it e-business, short for electronic business. What is e-business and what does it mean to you? Let’s take a look.

E-business is the practice of exploiting the Internet for every possible business advantage. It includes selling things over the Internet (we call that e-commerce), as well as functions that provide customer service and support, market research, electronic mail (e-mail, that is), competitive business analysis, and links to suppliers, customers, and business partners.

The primary reasons to consider e-business for your firm can be summarized in three words: commerce, communication, and collaboration.

Certainly commerce, or e-commerce, is growing at breath-taking speed. Short for electronic commerce, it is defined as performing business transactions on the Web, aka shopping. Its primary niche is in the business to consumer market, and with the right product, can generate significant increased sales.

E-commerce is not to be taken lightly though. It can be quite an investment to set up, and requires significant administration and on-going support. Security considerations to protect credit card numbers, the capability to track customer preferences, and an infrastructure to support the influx of orders can add up to a very technology-intensive investment.

Success in e-commerce requires a marketing strategy to get the word out that you are on the ‘Net. Advertising on the Internet, including search engines, banner ads, and links from other web sites, will probably not be enough to bring your customers to you. The experts still rely on good old-fashioned conventional advertising to get attention. Needless to say, with so many firms on the Internet, the competition is great.

Remember, too, that increased sales does not necessarily mean increased profits. The success of amazon.com is a case in point. With more than 100 employees and a 17,000 square-foot warehouse facility, its growth has been phenomenal, considering it started in 1994 in a garage in Seattle. The bottom line has been a different story.

E-commerce is certain to change the way we do business, and its growth promises to continue. Consider that this is only the beginning. Despite record growth, outgrowing the most optimistic projections, e-commerce still remains quite small, at less than one percent of the retail portion of our economy.

Other reasons to consider e-business are communication and collaboration. Communication is the basis for sharing and distributing information and knowledge. Collaboration puts the people and information together to accomplish what needs to be done. Consider the following e-business functions to facilitate communication and collaboration.

One of the simplest functions to implement is electronic mail, or e-mail. By communicating electronically, information and knowledge can be delivered at record speed (certainly faster than the fax machine or US Postal service). The information can be saved for later retrieval, accessed at the convenience of the person receiving the information, and forwarded to others who need the information, inside or outside your organization.

Work groups put people and information together and can involve persons located virtually anywhere in the world. The concept of virtual teams can put your best players together.

A web site, even in its simplest form, facilitates communication with prospective and current customers, suppliers, and business partners. Its value increases as you add function, letting customers retrieve information on their orders, for example. Consider an internal web site, making information to your staff easier access.

Virtual enterprises establish common repositories of information for non-competing companies.

Is it worth it? According to Meta Group, the typical intranet has a return on investment of 38 percent. This return grows significantly, to 68 percent, for intranets that give employees dynamic, interactive access to key business information.

One thing is certain. E-business is changing the way we do business. The time to investigate which functions are best for your organization is now.