Business Works: Success Story

An old-school manufacturer becomes a New Age Technocrat

1. SITUATION
ManuFAX had been a global leader in the old/offline economy. Now, it needs to decide how to adapt its business to the Internet.

ManuFAX had been a longtime market leader in the Californian electronic components distribution industry. In recent years, the Internet has transformed the competitive landscape in this industry. New intermediaries have emerged, and several key competitors have made significant investments in online technology.

ManuFAX has been deliberately late in embracing the Internet, due to skepticm of this channel as a viable revenue channel. Now, the company wants to evaluate its use of online commerce to understand how best to leverage this new channel.

2. PLAN & ACTION
BusinessWorks established several workstreams to evaluate Internet threats and opportunities and to develop a strategy for ManuFAX to move its business online.

These workstreams included:

- Idenfity trends & key business drivers in the electronic component industry and assessing ManuFAX’s performance
- Benchmarking competitors e-commernce initiatives
- Quantifying the impacy the internet could have on internal operations & transaction costs
- Assessinhg the impacy of the internet on supplier ahnd customer power & pricing
- Identifying ways to leverage technology efficiently and effectively

3. RECOMMENDATIONS
BusinessWorks recommended that ManuFax adopt a defensive strategy by using the Internet at a critical place in the value chain -- to better serve suppliers and customers, thereby preventing competitive entry to the market.

4. RESULTS
BusinessWorks’ detailed analysis convinced ManuFAX’s management team that embracing the Internet was a critical defensive strategy for its business.

Our findings gave ManhuFax a solid understanding of the opportunities and threats of the Internet, as well as the full range of options available.

BusinessWorks has recently completed implementing the recommendations outlined in our analysis and to date, the defensive strategy has succeeded. Neither existing competitors nor e-commerce upstarts have entered ManuFax’s market space.