The global net-enhanced organization.

Cheek, Ronald G. ; Sale, Martha Lair ; Hatfield, Robert 等

ABSTRACT

In the digital, Net-based economy, there is extraordinary pressure on local, regional, national, and international industries to drive down costs and increase productivity. For organizations operating in this economy, pressures come from not only traditional, but also "virtual" organizations. Successful organizations are forced to innovate and continually reinvent themselves and compete. As organizations move many of their sales and operations to the Net, they evolve from local or regional companies to players in the global arena.

The evolution to a global enterprise requires a systemic change throughout the organization. Success, or perhaps survival demands continues to demand that every organizational decision be focused on the wants and needs of their customers. After moving into the global arena, this challenge is dramatically more difficult when faced with differing time, language, and cultural differences. These successful companies, as they evolve into the global arena will develop, support, and sustain a customer-centric organizational culture.

Global customers demand the same 24/7/365 level of service as domestic customers. The powers of the Net offers organizations the ability to effectively and efficiently respond to these demands. Organizations that successfully respond to these demands have the potential to develop life-long customers with long-term loyalties.

The global arena brings a whole new set of challenges for organizations. Although the Net is able to make distance irrelevant, global customers have different cultures, languages, and time zones. In this paper, we discuss strategies that can be used as they evolve into global Organizations.

INTRODUCTION

The new millennium has arrived and with it a world consumed by the Internet (Net). It has changed relationship both inside and outside organizations. This new, digital, Net-based economy demands that organizations drive out inefficiency, lower costs, increase productivity, and make customers the driving force in all decisions. Organizations must make significant changes to their structure and overall culture to meet the needs of their customers. Success requires moving away from "how it was" and move towards "how it will be." For these organizations, innovation and change is continuous. An organizational commitment to moving every possible operation to the Net, provides the impetus for success. Traditional organizations recognize that fast and flexible new Net-based companies are taking on dominant incumbents, both in high and low tech industries.

It is important to understand that eBusiness dramatically changes the way business is conducted and challenges traditional organizational culture and leadership. It is not merely having a "cool web site," but rather its about how organizations can use the power of the Net to improve all aspects of their operations. The goal of eBusiness for any organization should be to improve the overall experience of their customers. To achieve this lofty goal requires organizations to be flat, flexible, collaborative, and willing to innovate and change. The demands of consumers must be the driving force behind all organizational decisions.

Table 1 explains how the customer, employee, and organization roles have changed in the evolvement from eCommerce to eBusiness. The purpose of eCommerce was to extend the reach of the sales and marketing department through the use of the Net. Many organizations felt that by putting their catalogs online they were maximizing the benefits available when conducting business online. From an organizational standpoint, all decisions were based on what was in the best interests of the company. The needs or the demands of the customer were not a consideration. In eBusiness, the entire organization is involved and the entire focus of the organization is on the needs of the customer. Based on dialogue with customers, products and services are customized to meet their needs. Organizations in eBusiness seek to extend or enhance traditional services through online activities. Employees are not only allowed, but encouraged to communicate directly with customers. Companies participating in eBusiness focus on the customer and their feedback is used in the allocation of resources. The demands of the customers provide are responsible for providing organizational direction.

When companies are committed to eBusiness, it is difficult to separate the organization from its Net activities. Operations performed on the Net are natural extensions of the organization's off-line operations. EBusiness enhances, or in some instances may completely replace the traditional ways that organizations do business. EBusiness activities are not separate from other organizational processes, but rather a valuable ingredient in all activities.

ECommerce was a first step for organizations doing business online. Encouraged by their early marketing and sales successes, they looked for other online opportunities. EBusiness is the evolution from eCommerce to using the power of the Net to dramatically transform every business process in the organization to take advantage of the Net.

THE IMPORTANCE OF eBUSINESS

Early on, the Net was touted for its ability to connect companies and consumers in real-time, regardless of their geographic locations. Initially, because of the cost of computers and consumer fears of technology, there was limited use of the Net. Now, driven by the lower cost of personal computers and the consumer's acceptance and comfort with the use of the Net, growth has increased at a phenomenal rate. Some estimates indicate that there are over 300,000 eCommerce sites, with that number growing at an amazing rate. As the Net grows in popularity, consumers and organizations are finding new, innovative ways to take advantage of the online experience. The opportunities on the Net are available to organizations, regardless of size. The Net has leveled the playing field allowing small start-up companies to successfully compete with well-established industry leaders.

The hours of operations for organizations doing eBusiness are twenty-four hours a day, seven days a week (24/7). Each and every day on the Net, millions of organizations and individuals correspond and exchange vast amounts of information in real-time. They are also able to do comprehensive research on goods and services for little or no cost. Organizations are using power of the Net and eBusiness to reinvent their businesses. It is also allowing them to increase service to customers and function on a 24/7/365 (twenty four hours per day/7 days per week/365 days per year) basis.

Industries are no longer run by a tiny handful of huge companies. The New Economy thrives on the free market system and has a way of eliciting unexpected, fast-growing start-ups that evade direct competition against the industry giants. As a defensive strategy, many entrenched traditional organizations are using mergers and acquisitions (M&As) to respond to new competitors. Historically, the purpose off M&As (in any industry) is not to provide consumers with something fresh and imaginative. Rather, the "old boys" assume that if they consolidate to do more of the same--only cheaper and with broader marketing--consumers will forget about the offerings of the new rivals. In the New Economy, driven by eBusiness, the customer won't allow this to happen. Economies of scale are secondary to the demands of the customer.

Entirely new eBusiness organizations are disrupting the sales, manufacturing, and distribution "rules" that traditional industries have always followed. For Old Economy organizations, the profitability embedded in the entire value chain is being threatened. The lessons learned are that today's financial successes, market share, and awards are not guaranteed predictors of future successes. In the New Economy, yesterday's results are a reflection of yesterday's decisions. To capitalize on the opportunities available in the New Economy, organizations must understand that decisions must be made using future, not past information. This is the essence of eBusiness in the New Economy.

EVOLUTION TO eBUSINESS

Sound business models and management principles are not industry specific, but rather applicable across industries and businesses. Organizations in the New Economy will use traditional basic management principles, adapted to the requirements of the New Economy, to successfully compete. In this section, the foundation will be laid for the challenges that organizations face in developing sound business models and management principles that will allow them to successfully function in the New Economy.

Yet as the new millennium dawns and the rules for business change, the basic tenets of management remain. There are challenges for organizations as they move from the "Old Economy" to the "New Economy." Organizations are accustomed to a relatively simple environment in which their role is fairly clear. In the New Economy, the horizon is a mass of curves and obstacles that provide no clear message for organizations. Compounding this uncertainty is an economic terrain littered with the spoils of failed eBusinesses in the New Economy. In order to successfully survive the terrain of the New Economy, management will have to embrace an organization culture that encourages and rewards innovation. Moving into the New Economy requires planned organizational change. There must be a purposeful attempt by management and employees to move the organization from the "Old Economy" to the "New Economy."

Successful organizations will adopt sound business models and use good management principles in their pursuit of eBusiness. They must address the fundamental management issues and not merely be swept up in the "electronic" frenzy. The purpose of eBusiness is to use its power to leverage, not replace other organizational resources. Management will be challenged to bring a pragmatic approach to design, develop, and implement solutions to the challenges of eBusiness.

In order to respond to the challenges of the New Economy, organizations will have to continually reinvent themselves. They will have to streamline and integrate business processes in order to reduce costs and better serve customers. Many organizations, in their rush to keep up with the frenzied speed of eBusiness, ignore the need for sound management principles and business models. For the past 20 years management experts have preached the need for "flat" organizational structures with as few hierarchy layers as possible. Functional departmentalization, or the separation of work and workers into separate units to make them responsible for specific tasks does not work in the New Economy. Operating on the Net in real-time does not allow the time for decisions to be made up the hierarchy ladder. Customers demand real-time answers to their questions and problems. Employees throughout the organization must be empowered to respond to the needs of customers. Organizations are challenged to develop a managerial structure which has the ability to successfully respond to these customer demands.

Means and Faulkner (2000) postulate successful companies in the New Economy will follow entirely new business models and use enormous discipline and management competence. They accomplish this by breaking away from "Old Economy" rules for their industries and take chances on using the "appropriate" business models that will allow them to dominate their industries in the near future. The "appropriate" business models from their perspective will be governed by the following rules:

 The Past Is Not Prologue-But It Helps--While the past provides an
 excellent foundation, it may not offer any direction
 for the future. During the transformational period, companies
 will have to "just figure it out." They offer that "moving
 out of the box" requires an understanding that the box contains
 tremendous insight and wisdom on management and
 value creation.

 Business Excellence and Discipline--In order to create and
 implement innovative ideas, management must have
 tremendous discipline and excellent business models. Necessary
 components include and understanding of business
 life cycles, supply chain management, backroom process
 excellence, and a commitment to continuous learning and
 professional development.

 Companies Must Be e-Enabled--They use the power of the Net to
 create and review as many ideas as possible, develop
 them rapidly, and then use this information to launch them
 in a expeditious manner. They must develop and maintain
 strong knowledge management systems which promotes the
 capture and exchange both internal and external
 environments.

 Dynamic Innovation Is Strategy--Strategy for the organization must
 be as dynamic as the New Economy. A concerted
 organizational effort must be made to create an agile
 and responsive innovation culture that embraces change from a
 proactive rather than reactive approach.

 Strong Business Management--Management teams must have exceptional
 business competence. They must adhere
 to sound business principles and when necessary, have
 the flexibility to move quickly and instinctively.

 Freedom to Incubate and Fail-Once (Maybe Twice)--The
 New Economy is composed of organizations that have tried
 many different ideas with as little as 25% being successful.
 It is important to create the organizational culture that
 encourages, in spite of failure, the commitment to try new
 ideas. This should include a strict business discipline that
 results in the a declining average failure rate while at the
 same time maintaining a dynamic and innovative culture.

 A New Style of Organization and Management--Management must be
 willing to cannibalize the core organization.
 The organization must recognize that if the entire industry
 is undergoing a transformation, transformation within their
 organizations will be required as a key to success (Means &
 Faulkner, 2001).

Organizations must develop a pragmatic approach, grounded on sound management principles and business models in order to achieve the competitive advantage opportunities available in eBusiness. These organizational strategies must be based on the assumption that eBusiness will be integrated in all activities and significantly change all business processes. No longer can organizations use a "seat of the pants" strategy, but will require a more disciplined approach to dealing with the challenges of eBusiness. It should not be considered a "technical" issue, but rather a new direction in organizational culture.

THE GLOBAL IMPACT OF eBUSINESS

Unquestionably eBusiness has dramatically changed the ways in which organizations conduct business. It is also having a significant impact society, on federal, state, and local governments, and in the global economy. To reach 50 million viewers, it took a combined 38 years of radio, 13 years of television, and 10 years of cable TV. The Net has connected over 50 million people in just 5 years (Fellenstein and Wood, 2000). The acceptance and shift for individuals to technology has been truly amazing. Whether locally, regionally, nationally, or on a global basis, the Net and eBusiness has created a virtual community of global e-societies.

The United States is clearly the global leader in eBusiness. Most industry experts agree that the U.S. leadership in computer an software technology is responsible for this lead. For example, Internet penetration in the U.S. is far above the European average. However, Internet usage in Europe (EU) is expected to increase by 40% in 2000 as compared to a 25% increase in the U.S. The population in the Asian-Pacific market provides the perfect environment to take advantage of the Net and the New Economy. In this section, we discuss the eBusiness potential for the European and Asian-Pacific markets.

Europe

The European Union (UN) is the effort by 15 countries with approximately 370 million citizens to develop a highly sophisticated "single market." This "single market" would seem to be the ideal scenario for the introduction of eBusiness. However, the 15 members seem to share several "common traits" that inhibit rather than encourage eBusiness. These "common traits" include:

 No accepted common EU language;
 Differing cultures, legal requirements, and
 attitudes when looking at consumers;
 No common ground on consumer privacy;
 And slow and laborious processes for negotiating and
 implementing new trade legislation.

The combined impact of these "common traits" initially limited enthusiasm by the members of the EU for eBusiness. Yet as awareness of the financial potentials of eBusiness increased, so did EU members desire to participate in the Net driven New Economy.

Estimates indicate that 1999 only 10% of European citizens use the Net will total eBusiness revenues of approximately $19 billion. This figure represents approximately 20% of US eBusiness revenues but is expect to increase to $430 billion (60% of US) by 2003. It is also anticipated by 2006 that over 50% of Europeans will be online (Weyer, 2000). As seen in Table 2 Europe has been slow to get online, but is expected to rapidly increase usage as early as 2002.

Many of the EU members are faced with the need to make significant financial investments in an infrastructure (telecommunications, wiring, etc.) that will support eBusiness. Britain on the other hand has the advantage of one of the best telecommunications infrastructures in Europe. In addition to this infrastructure, Britain also has a large pool of skilled employees and a common language. While these factors provide Britain with a significant advantage, they are also challenged with an eBusiness legislative framework that is still in its infancy.

Germany is the leading eBusiness member of the EU. They share 15.5% of the global eBusiness market, Britain has 6.6% and France follows with 3.8%. While leading the EU in eBusiness activities, Germany continues to be inhibited by its consumer protection laws. However, the potential for significant financial rewards have driven them to take steps to encourage, rather than discourage eBusiness.

The Commission Enterprise and Information Society in Hanover, Germany in February, 2000 outlined several goals to bring about an eEurope. The purpose of these goals is to accelerate the transition in Europe to an information society. Included were three key objectives from the political arena at its highest level that included:

 First, bring on-line every home, every school, every business
 and every public administration.

 Second, create a digitally literate and entrepreneurial Europe,
 which benefits from dynamic investors ready to develop
 and finance new ideas.

 Third, ensure that the transition to the digital age is a
 socially inclusive process--that it builds consumer trust and
 strengthens social cohesion.

In their opinion this effort must be on a collaborative basis and include participation by European industries. Although this is considerably less than the U.S., it is anticipated to continue to grow (Liikanen, 2000). EU members agree that speed and openness are keys to success in eBusiness and effective legislation must use these concepts as their driving forces. In eBusiness the most successful form of regulation seems to be "self-regulation."

In order to establish an eBusiness standard for the EU, they have adopted or have pending the following regulatory guidelines:

 Legal directives which include a common framework for electronic
 signatures, agreement on certain aspects of
 copyright and other rights;

 Tax directives that include in preliminary information on
 value-added tax (VAL) and electronic invoicing; and
 And other policy related documents that include items such as
 domain names and policy priorities.

A major challenge for the EU members is capturing taxes on the profits of eBusiness entrepreneurs. The geographic location of these eBusiness entrepreneurs could be anywhere in the world. Different members of the EU may use generous tax treatment as a method of encouraging eBusiness organizations to reside in their countries. For example, while the average business tax rates are 30% across Europe, Ireland has offered e-businesses coming to their country a 12% tax rate. This is can be compared to the standard tax rate of 28% for traditional "bricks and mortar" Irish businesses. Other countries have not ruled out similar incentives, consumers and entrepreneurs can be expected to set the pace in eBusiness development. The most successful EU countries will be those with the best combination of business incentives and favorable eBusiness legislation.

Asia--Pacific

The Asia-Pacific region lags behind the US and EU in eBusiness, but is making significant, rapid progress. As of March 2000, the region has 69 million internet users as compared to 83 million in Europe. Experts expect the global eBusiness market to increase from$43 billion in 1998 to $1.3 trillion in 2003. The majority of this increase is expect to go to the Asia--Pacific region. Within this region is the largest concentration of population in the world and is expected to do approximately $32 billion in eBusiness by 2003.

Although Asia shares common eBusiness challenges with other countries in the region, they have other problems unique to their country. Some of the major problems faced by Asia to participate in the global eBusiness include:

 Transaction settlements--Most transactions in Asia involve cash.
 Very few Asians have access to credit or credit
 cards.

 Software Piracy--Asia is known for its frequency of software
 piracy and copy infringements. In order to operate in
 the global eBusiness, these issues will have to be addressed.

 Distribution--No established distribution network exists in
 Asia. Challenged with the vast geographical area,
 successful eBusiness will require the establishment of a
 distribution infrastructure.

 Telecommunications Infrastructure--Citizens with Asia do not
 have broad access to the Net. For eBusiness to prosper
 in Asia, its citizens must have access to the Net.

 Legal and Regulatory--The laws and regulation of eBusiness can
 be expected to vary greatly from country to country
 in the Asian region.

Another challenge is that the Asian market is not homogeneous. It can be considered a region of "haves" and "have nots." The language, culture, literacy and wealth varies greatly from region to region. EBusiness entrepreneurs operating in these regions will have to deal with these significant challenges.

While the EU is issuing tax collection directives and the US seeks some method to collect sales taxes, the Asia-Pacific region has taken a "wait and see" approach. In their opinion, the collection of sales taxes would hinder, rather than promote eBusiness. However, they are actively tracking online transactions and may at a future date use this information to "revisit" their legal and sales tax collection policies. Table "2" provides an overview of the "Legality of Transactions" and "Tax Policy" for several countries in the Asia-Pacific region.

The continuing debate in the Asia--Pacific region is "globalism" versus "nationalism." EBusiness brings that age-old debate back to the forefront. In order to share in the potential eBusiness financial rewards, they must open their markets and their methods of doing business to the eBusiness entrepreneurs. To many, the price is extremely high and quite unsettling. While this is especially true to China, other countries such as Singapore, Thailand, Malaysia, and the Philippines are busily restructuring to encourage eBusiness. For example, they have all passed recent legislation that accepts the legal standing of electronic contracts and digital signatures.

However, experts agree that the economies of Asia -Pacific will not be reinvented overnight. In reality there still exists many cultural and infrastructure barriers to the New Economy for these countries. Table "3" describes some of these barriers.

Change is in the air in Japan as it collects its resources and makes a charge to catch up with the West and build a New Japan. The young entrepreneurs in Japan have embraced the Internet driven New Economy. In a recent speech, Masayoshi Son, 42 years old and the founder of Softbank Corporation explained to a group of young Japanese professionals "The most amazing opportunities await you." His message to these young Japanese entrepreneurs was clear "Japan's businesses are going through a social upheaval in their rush to modernize and if you don't get on board--you will miss the boat (Kunii, 2000)."

Software Corporation has invested approximately $400 million in Japanese Internet start-ups who have a current vale of almost $50 billion. Some observers call these growing families of Japanese Internet start-ups funded Son and other investors "keiretsu". Others think they show a greater resemblance to the family-run industrial combines, called "zaibatsu". The "zaibatsu" started out as retail ventures and grew into large powerful groups engaged in trading, insurance, and shipping. Many, however have coined a totally new word "Net-batsu" to describe these New Economy Japanese start-ups.

Regardless of what you call them, they are dramatically different from the traditional Japanese organization. They have the potential to bring profound changes in business cultures and society. Table "4" provides information on the investors that are funding the Japanese Internet start-ups.

The Japanese Internet start-ups are the driving force behind the re-invigorated Japanese economy. The challenge will be for Japan to revise its rigid political and business structures to meet the needs of these start-ups. The New Economy entrepreneurial spirit in Japan, just as in the US, continues to stimulate growth.

CUSTOMER FOCUS

The rules for business in the New Economy include an accelerating shift toward the importance of the consumer. For organizations to successfully move to a customer focus requires a fundamental change in the way they conduct business. EBusiness provides the tool that allows the organization/customer linkage. It is the force behind the rethinking of the New Economy, industry by industry. The New Economy refuses to accept the status quo and the superiority of entrenched players. Merely offering extensions of existing products or services is no longer acceptable. Rather new innovative goods and services are produced when, where, and in the amount demanded by customers. Successful organizations in the New Economy will develop a business model based on the Win/Win/Win paradigm for organizations, customers, and suppliers.

The Net now makes technology and the latest business innovation instantly available to anyone, anywhere--almost instantaneously (i.e. real-time). It has the potential to level the global playing field by speeding the flow of information. The consumer now has the power to ignore everything the vendor's business has been built on and no longer is required to go to a retail store or even buy a physical product. The customer determines what they want to buy and where it will be purchased. EBusiness is evolving at Net speed and attention to customers has never been more critical.

The New Economy puts pressure on existing industries to drive down costs and other inefficiencies while continuing to focus on the needs of customers. Organizations in the New Economy, in an unrelenting drive for efficiency, focus on core competencies and outsource other functions. Organizations continue to be "attacked" and forced to innovate and continually reinvent themselves, subject to the demand of consumers.

CONCLUSION

Customers throughout the world demand products and services tailored to their specific needs. Organizations competing in the global economy can expect these customer demands to change and evolve with time. The organizations that successfully respond to these demands have the potential to develop life-long customers with long-term loyalties.

While the Net offers organizations a global marketplace, it also creates direct competition with business from around the world. Federal Express Senior Vice President David Shoenfield explains challenges in the global arena when he says "The transition to a technology-enabled, customer-focused company is never easy, but it is a lot easier if you start out as a customer-focused and then enhance that with technology" (Stein and Sweat, 1999).

As eBusiness becomes more prevalent in global economies, the interaction with international markets will continue to bring additional challenges. Companies have to understand the unique challenges that expanding globally presents. Cultural differences, language barriers, and different customer expectations and needs are only a few of these challenges (Herkemij, 2001). As organizations move into the global arena, success or even survival may well depend upon their ability to meet these challenges.

REFERENCES

Fellenstein, Craig, and Ron Wood, 2000. Exploring e-Commerce, Global e-Business, and eSocieties. Upper Saddle River, NJ: Prentice Hall PTR.

Herkemij, Y., 2001. Don't fall into the dot-com trap. World Trade, Issue 14, 42.

Kunii, Irene M., 2000. "The Web Spinners: Japan's Netrepreneurs Are Out to Win on a Global Scale." Business Week, March 31, 81-88.

Liikanen, Erkki, 2000. "EEurope: An Information Society for All." Presidents & Prime Ministers 9.2: 18-20.

Means, Grady E., and Matthew Faulkner, 2001. "Strategic Innovation in the New Economy." The Journal of Business Strategy 21.3: 25-29.

Stein, &. & Sweat, J., 1999. Customer Culture. Informationweek, Issue 718, 49-55.

Ronald G. Cheek, University of Louisiana at Lafayette

Martha Lair Sale, University of South Alabama

Robert Hatfield, Morehead State University

Table 1: EBusiness versus ECommerce

 Customer Employee Organization

Ecommerce Online Catalogs Directed by Sales Focus is on
 Limited Choice & Marketing Organizational
 Little Input Departments Needs
 Contact limited to
 online order takers

EBusiness Customization Entire Organization Focus is on the
 Open Dialogue Involved Contact With Customer
 Online Product Customers Encouraged Customer feedback
 Information used to adjust
 & Support products and
 production

Table 2: Asia--Pacific EBusiness Policies

Country Legality of Tax Policy
 Transactions

Australia Security & Electronic Developed the Australian Tax
 Transactions Act Office (ATO) to oversee tax
 administers online concepts related to eBusiness
 transactions

China Does not have any The State Administration of
 general legislation Taxation (SAT) has asn
 regulating online internal committee reviewing
 transactions eBusiness but has not released
 and general public reports

Japan No specific Has established the Working
 legislation for Group on Electronic Commerce
 online transactions, and has released a report
 but uses their recommending that the Japanese
 general laws for government consider appropriate
 governance taxation methods

Hong Kong Has a comprehensive Hong Kong's territorial-based
 Electronic tax system only taxes Hong Kong
 Transactions source income and is therefore
 Ordinance and uses expected that eBusiness taxation
 the Hong Kong Post is inevitable.
 Office as its
 certification
 authority

Singapore Has developed legal To encourage eBusiness, Singapore
 status for the use of approved a cyber trader tax that
 electronic records provides a 10% concessionary tax
 and signatures rate on income derived from
 transations over the internet

Table 3: Asia--Pacific Barriers to the New Economy

Country Japan South Korea

Barriers Info-tech sector Runaway
 is about the only fascination with
 rising star in an online trading
 economy just and smart phones
 emerging from all the rage. Still,
 recession. Still financial sector is
 carrying a lot of a basket case, and
 dead weight in more corporate to
 sunset industries restructuring a
 must.

Netizens 20 million 7.8 million

PC Owners 30% 23%
(% of households)

Country Taiwan India

Barriers Powerhouse in Surprising new
 production of entrant, and info
 laptops, and other tech sector is
 computer growing.
 hardware. Aims Although few of
 to triple size of the foundations
 software industry of a New
 to $4.5 billion Economy exists,
 its engineers have
 a knack for
 making software

Netizens 4.2 million 2.1 million

PC Owners 35% 2.5%
(% of households)

Country China

Barriers Boasts fast-growing
 Internet and mobile
 phone markets. Beijing
 worried about e-dissidents.
 State-run companies
 facing shake-up.

Netizens 10 million

PC Owners 1.7%
(% of households)

Source: Business Week/January 31, 2000 Page 91

Table 4: Funding Japanese Internet Start-Ups

 Softbank Hikari Tsushin

Net Builder Masayoshi Son, 42, Yasumitsu Shigeta, 35,
 president and CEO is has invested in more
 the master Net empire than 70 WeBusiness or
 builder. His mobile Net-based
 conglomerate holds ventures in Japan and
 stakes in 300 Internet the US, including
 companies in the US, Tumbleweed
 Japan, Europe, and Communications and
 other parts of Asia. Phone.com. Shigeta is
 Today, Softbank also developing company
 manages about $4 businesses that take
 billion in venture advantage of the growth
 capital funds for of the Internet and
 global investments. mobile communications.

Market Cap $180 billion $62.1 billion

Sales $4.5 billion $2.4 billion

Stock Price $1648, up 139% in 3 $2009, up 25% in 3
 months months

Operating $161 million (fiscal $51.5 million
Profits year 3/00) (fiscal year 8/99)

 Trans Cosmos InterQ

Net Builder Koki Okuda, 63, has Masatoshi Kumagai, 36,
 been making strategic is Japan's newest
 investments in Real Internet star. A high
 Networks, Liquid school dropout,
 Audio, and Kumagai founded
 DoubleClick. Last year Voicemedia, a
 his firm set up the local multimedia
 operations for communications
 Autobytel Japan. The company. He took
 also formed a interQ public August
 $100 million venture 1999. In 1995, he
 with Nikko Securities moved into ISP
 last November. services, and is now
 investing in promising
 start-ups.

Market Cap $11.3 billion $7.7 billion

Sales $454 million $34.3 million

Stock Price $465, up 152% in 3 $630, up 128% in 3
 months months

Operating $44 million (fiscal year $6.6 million (fiscal year
Profits 3/00) to 12/99)

Source: Business Week/March 13, 2000, page 85