As we are all well aware, the economic picture in the technology sector has been rather dismal of late. Especially in the past month, it seems everyone wants to know if we've hit bottom and if we can expect improvement in the near term. Based on conversations with a number of companies, it appears we can be cautiously optimistic about the future. The new economy pendulum had swung to such a major extreme that it will undoubtedly be some time before it returns to its natural position, and companies will probably overcorrect in that direction before stabilizing. The truth is that the Internet created a new channel for communications, and the amount of new investment in this area received such an influx of capital that it prevented companies in the old economy from obtaining money to enhance their businesses. Now that a significant amount of capital has been squandered on weak business models, we are returning to the norm with regard to profit expectations and expect continued improvement. While times have been rough economically, we have learned valuable lessons over the past two years including:
1) The Internet is a channel to reach the customer and must be incorporated with all other touchpoints in the organization.
2) The Internet has reduced the cost of doing business by eliminating a lot of costs with regard to intermediaries.
3) The Internet has increased the speed at which corporations conduct business, and a large number of sell cycles have been compressed.
4) The Internet must be incorporated into the overall strategy of the corporation and cannot function as a standalone entity.
5) E-mail has greatly enhanced communication, but at the same time must be controlled and filtered to remove the noise. Junk e-mail and spam negatively affect efficiency in many corporations today.
6) Technology must provide a measurable ROI and profits do matter, as most employees of the now defunct dot-coms would attest.
I am sure there are other significant lessons to be learned from the mania of the past two years, yet these lessons are significant because they to some degree justify the tremendous amount of money we have invested in technology over the past two years. Hopefully, we will see dramatic economic improvement in months ahead.