Rather than displaying a printed ticket on the windscreen, the online or phone booking and payment is recorded in the database of the car parking provider, and all cars in the car park are checked against this database. So, what was a previously private matter, where and when I parked my car, has now become an ongoing record in a corporate database. Replicate this over all the customer interactions that are now based on the use of IT and it is easy to see why many people are concerned about the amount of personal data that is held about all of us and hence the increased potential for misuse of that data. UK citizens are already viewed as the most surveyed in the world; data capture as a by-product of de-personalising the customer interface will simply add to this.

The subject of the collection and use of personal data both from consumers and from people in the workplace has formed a basis of ongoing research at the Open University Business School, see for instance Ball, Daniel, Dibb and Meadows (2009). This team of researchers, which have backgrounds in surveillance, information management and marketing, has recently won funding from the Leverhulme Trust to explore what they have termed “new uses of customer data”; that is, uses of data that customers may not be aware of or that firms are being required to undertake, for example, by regulators and law enforcement agencies.

"So, what was a previously private matter, where and when I parked my car, has now become an ongoing record in a corporate database."

 The focus of the work will be firms in the financial services and travel sectors, which is particularly relevant when two of the three guests on the programme are from the travel sector. Both the financial services and travel sectors espouse the benefits of customer relationship management and the related activities of customer profiling and segmentation. For these activities they collect and store considerable amounts of information on their customers, including personal details and a record of all their transactions and purchases. However, as the focus of the research suggests, this data may be used for purposes that are not obvious to those that are providing it and may have unforeseen side-effects or consequences, both for the individual customers involved and for society at large.

As more and more organisations make use of technology to automate their interfaces with their customers, this collection of data will increase. Indeed, as in the case of the use of my station car park, customers may not even be aware of the information about them that is being stored, let alone how it might one day be used.

Find out more

Open University Business School research project Taking Liberties: New Uses of Consumer Data in the UK

Who's watching you work? Surveillance in business

A Report on the Surveillance Society
by KS Ball, D Lyon, D. Murakami Wood, C Norris and C Raab, Surveillance Studies Network.

Democracy, surveillance and 'knowing what's good for you': the private sector origins of profiling and the birth of 'citizen relationship management
by KS Ball, E M Daniel, S Dibb and M Meadows
from Surveillance and Democracy
edited by M Samatas and K Haggerty

Coercion versus Care: Using Irony to Make Sense of Organisational Surveillance
by G Sewell and J Barker
from the Academy of Management Review, Volume 31, Number 4, pages 934-961

About the author

Elizabeth Daniel is Professor of Information Management at the Open University Business School where she undertakes research and teaching in the fields of e-business and information systems. Elizabeth also undertakes consultancy work for a number of blue chip and leading public sector organisations.

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Massive multiplayer online games or MMOGs (also sometimes called massively multiplayer online role playing games, MMORPGs) are a range of games played with many others – often thousands and even millions of others -  via the internet. They seem to come in two flavours – either based upon gnomes, trolls and slaying dragons and other beasties or a virtual form of real life, that seems to be nothing like real life as you get to decide for yourself just how beautiful and sociable you are.

As I say, they don’t work for me. In fact the only comment that seems to come to mind when I think about these games is…why? But this lack of understanding may not be my fault. The traditional users of MMOGs are between 18 and 35, and although they are allegedly popular with women, with approximately 30% of players being female, as an older woman (just slightly older), I am not the target demographic. When it comes to online games, older women, or so I have read, ‘enjoy playing short puzzles and logic games’.

'Calvin Klein has announced plans to launch a virtual fragrance'

Whilst these games may not appeal to my natural tastes, as a business and management academic, there may be more professional reasons to give them further thought. These games appear to be offering organisations a new channel to promote, and perhaps eventually distribute, their products and services. Adidas, Toyota and Dell have all created content in the MMOG Second Life. The clothing store, American Apparel, have opened a store in this virtual world, where players can buy items for their virtual alter ego, and Calvin Klein has announced plans to launch a virtual fragrance. 

These virtual worlds have also been identified as a potential laboratory for social scientists such as economists. Economics is an area where it is notoriously difficult to test theories and compare outcomes of different actions. Whilst simple experiments can be set up in classrooms and labs, unless you have a small country at your disposal, it is very hard to set up situations with stakes that the participants really care about or which involve large numbers of individuals over long periods of time. The virtual worlds created in MMOGs meet these criteria perfectly and could provide powerful test beds for new ideas on fiscal or monetary policy or areas of social policy. Indeed, the academic credibility of these games is already established, with one professor in the US securing funding to construct a virtual game world to try out such experiments and Brunel University appointing the UK’s first professor of digital games, whose area of study include MMOGs.

So, perhaps there is something in these games for all of us after all……or perhaps I should just stick to the short puzzles and logic games!

Further reading

•  
• Virtual world, real millions - the Money Programme investiagtes the millions of people opting out of real life and signing up to "live" in computer worlds
• What makes an entrepreneur? - take a test to discover if you’ve got what it takes
• Join the discussion - What do you think of Second Life and World of Warcraft?
• Synthetic Worlds: The Business and Culture of Online Games by Edward Castronova, published by University of Chicago Press
• Tomb Raiders and Space Invaders by Geoff King and Tanya Krzywinska, published by IB Tauris
• Understanding Digital Games by Jason Rutter and Jo Bryce, published by Sage Publications

About the author

Elizabeth Daniel is Professor of Information Management at the Open University Business School where she undertakes research and teaching in the fields of e-business and information systems. Elizabeth also undertakes consultancy work for a number of blue chip and leading public sector organisations.

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Ever keen to follow a trend, I shall share my own experiences of Web 2.0 life. Unfortunately, not being quite on the crest of this wave – I haven’t recorded or posted my own video on-line yet, but like any self-respecting ten year old, my son has. Whilst not in the league of some of the most watched video clips, such as the motivational speaker, Judson Laipply, dancing Barrymore-like to various songs (approx 40 million views) or a personal favourite, the band OK go singing whilst carrying out a complicated dance routine on gym running machines (approx 9 million views). My respect for the latter made greater by the fact I know what damage can be done by falling off such a machine – the belt acts like a sander which is very painful when wearing shorts!

But more interesting to me, than the number of views my son has got (OK – so it’s just a total 45 across two clips), was why he had posted his videos in the first place. After all, he had had no encouragement from me or his school. However, my question to him about why he had posted them was met with a blank look and some words that seemed to be along the lines - you do it because it’s the thing to do. I checked to see if he thought the clips were so good that they would be viewed around the world and he would be famous. No, he hadn’t thought that – it’s just if you have something, you share it. Not a case of everyone might want to see them – more a case of, someone might want to see them.

Still, there may soon be a more obvious reason to share content on the most successful video sharing site, YouTube. At the World Economic Forum in Davos late last month, the CEO Chad Hurley announced their intention to share advertising revenues with those uploading videos. Commentators have speculated that there may be a number of reasons for this move. It may be that they are reacting to competitors that already offer payment to those sharing videos. Alternatively, it may be that Google is looking to earn a speedy return on the $1.65bn it paid for YouTube last November and will drastically increase the amount of advertising on the site. Sharing revenues with content providers may make this increased advertising more acceptable. However, Nicholas Carr, the former editor of Harvard Business Review thinks there may be more significant reasons. He speculates in his own blog, that a relatively small number of videos will account for a disproportionate amount of the earnings. ‘Locking up’ the content of these videos will become important for ensuring significant user numbers and hence revenues. In return for payment, YouTube may seek those uploading videos to grant them an exclusive licence - currently they ask for a non-exclusive, royalty free licence. This would give them complete control over the video hits of the future, just like more traditional media businesses. So, perhaps we should enjoy sharing for the sake of sharing while we still can.

Futher reading

• What makes an entrepreneur? – take a test to discover if you’ve got what it takes
• DIY TV – the Money Programme meets the everday people who are watched by millions
• Join the discussion – what do video sharing sites mean for TV companies?
• Rough Type – Nicholas Carr’s Blog

About the author

Elizabeth Daniel is Professor of Information Management at the Open University Business School where she undertakes research and teaching in the fields of e-business and information systems. Elizabeth also undertakes consultancy work for a number of blue chip and leading public sector organisations.

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• a new route to market for an existing business
• an opportunity to create a business that wouldn’t have been possible before
• a host organisation on which to piggyback

A friend collects and trades military memorabilia, specialising in medals from the two World Wars. He – and his long suffering wife – spent many weekends with their thermos flasks in chilly village halls attending collectors’ fairs, both to search for and sell items.

eBay has provided them with a new route to market. They now spend their weekends in the comfort of their own home, but have still managed to increase the turnover of their small business. Part of this growth is trading with people from outside the UK who they never would have met via the collectors’ fairs.

"You’ll be surprised how many people you know are eBay entrepreneurs"

Meanwhile, a friend of a friend (if you ask around, you’ll be surprised how many people you know are eBay entrepreneurs) gets to spend her weekends doing what she does best: shopping. She spends her time at discount stores such as TK Maxx and Primark, buying heavily reduced items.

Buyers are infected by the ‘auction fever’ of eBay and pay higher prices for these items than they would if they bought them in the stores. The thrill of the auction is providing a new business opportunity for her.

However, it’s the third of the approaches that I find most intriguing – creating a business by piggybacking on the internet giant. Many companies provide services to other eBay users, for example some specialise in packaging products for those selling on the auction site. Others examples include the US chain iSold It, and its UK equivalent Auctioning4u, that offer to sell items on eBay for people who do not have the time or inclination to do it themselves.

Such businesses provide goods and services that only exist due to the presence of eBay. This has been described as the ‘piggyback economy’ and has been likened to remora fish, that survive by clinging on to the back of larger fish and turtles, or to the small birds that live by grooming larger mammals.

The piggyback economy has been estimated to be worth tens of millions of pounds, and isn't confined to eBay or internet businesses. In the offline world, Mike Ear (I understand you have to say it out loud) is a small business that buys, delivers and assembles Ikea furniture. It targets those of us who can’t face a trip to one of their stores or trying to make sense of their assembly instructions.

Like the examples from the animal world, the piggyback relationships are symbiotic rather than parasitical. In the case of Mike Ear, customers benefit as they get a more convenient and personal service than they can from the host company, Ikea. The piggyback company, Mike Ear, has low overheads and benefits from the brand of the host company. The host company, Ikea, benefits from increased sales.

The phenomenon of large organisations supporting a range of smaller organisations is not new. Large manufacturing firms were traditionally surrounded by small organisations supplying components or services.

"Failing to provide personal service allows a niche in the market for the smaller fish to fill"

What’s unique about the current piggybackers is that there’s often no need for geographic proximity with the host organisation. Also, more interestingly, they tend to be found operating between the host and the end customer, rather than as suppliers to the host. This suggests that despite the many benefits of large organisations, they’re failing to provide the personal service that consumers want, allowing a niche in the market for the smaller fish to fill.

Further reading

• Making It Big on eBay – The Money Programme follows a group of British sellers bidding for success
• What makes an entrepreneur? – Take a test to discover if you’ve got what it takes
• Money and Management Forum – How have you made money on eBay?
• Small Business Service
• HM Revenue & Customs
• The eBay Business Handbook: How Anyone can Build a Business and Make Money on eBay.co.uk by Robert Pugh, published by Harriman House Publishing
• The Ebay Entrepreneur: The Definitive Guide for Starting Your Own E-Bay Trading Assistant Business by Christopher Matthew Spence, published by Kaplan Business

About the author

Elizabeth Daniel is Professor of Information Management at the Open University Business School where she undertakes research and teaching in the fields of e-business and information systems. Elizabeth also undertakes consultancy work for a number of blue chip and leading public sector organisations.

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Then came the rapid growth in file sharing sites such as Napster, that allowed the copying and downloading of music onto PCs, often without royalties being paid. And just as the music industry has come to terms with new bands launching themselves on the internet without a record deal, the next big challenge seems to be bubbling under: mobile music.

What is mobile music? 

Although mobile music has been with us since the Walkman, the current use of the term is to describe the downloading and listening to music on mobile devices such as iPods and mobile phones. Whilst Apple’s iPod is currently the dominant device in the mobile music market – with their iTunes site selling 600 million downloads in 2005 – the iPod is expected by many to lose its dominance to mobile phones.

The power of the mobile phone in the music industry was demonstrated recently by Madonna. Some have put the success of her recent single Hung Up down to the fact that a ringtone was available one month before the record was released.

Mobile phone ownership is higher than that for most types of music players, so if the music industry can get mobile right, the returns could be significant. Indeed they may even be enough to reverse the downturn in music industry revenues witnessed in recent years.

Understanding adoption

However, to ensure they are not left behind by the growth in mobile music, the music industry must be sure that they have a clear understanding about what consumers want on their phones and how they want it served up. To help them with this understanding they should consider how new products and services are adopted by consumers.

The definitive work in this area undertaken by Everett Rogers more than forty years ago is still relevant today. Rogers identified five factors that influence both the level and rate of adoption of innovations. Understanding these factors, how they interact, and how to influence them, will help the music industry find its place in the mobile music future.

The five generic factors identified by Rogers are:

1. Relative advantage – how much the new idea or service is perceived to be better than existing alternatives.
2. Compatibility – how the new idea fits with the way users currently do things. This not only includes compatibility with existing hardware or networks, but also how users live or work.
3. Complexity – how difficult the new product or service is to use or understand.
4. Trialability – the ability to test the idea out on a limited basis.
5. Observability – how visible adoption or use of the new idea is to others.

Increasing or improving any of these aspects of a new product or idea – except for complexity which obviously needs to be reduced – will increase both the level and rate of adoption.

Mobile music adoption

So, what does this mean for the adoption of mobile music? Relative advantage rests on the ability to be able to access and to listen to music whilst on the go. In contrast to music downloads or CDs, there is no need to pre-download music or take a selection of CDs out with you.

"A great opportunity for the music industry"

You can access and buy music whilst out and about, allowing you to match listening to your changing moods and keep up to date with new releases. Such instant gratification is seen as a big attraction for many users and a great opportunity for the music industry.

With the ability to access one track at a time, and on a mobile handset that you are already used to carrying around, the trialability of mobile music is excellent. Provided interfaces can be kept simple and appropriate for small screens, then the complexity can also be addressed.

The power of observability to drive adoption was demonstrated powerfully by the iPod. Being seen with characteristic white ear pieces became a very visible sign of using an iPod. After a number of celebrities were seen with them, they became the thing to be seen with – a fact that was leveraged in the iPod ad campaigns.

"Compatibility may prove to be the Achilles heel"

But it is compatibility that may prove to be the Achilles heel. Users are increasingly using the mobile phones for various activities – which will help the transition to them being thought of as a music player. However, with regard to systems and formats, there are a number of proprietary approaches that prevent sharing music between devices and networks.

For example, iTunes will only download to iPods and not to the majority of mobile phones. Observers of the industry are keen to remind those trying to protect their own systems that, as the growth of the internet has shown, open standards can grow usage and demand to a greater extent than competing standards.

If the music industry do not take the opportunity to understand and shape this next wave of change, then Dylan may have got it right..."You better start swimmin' or you'll sink like a stone, for the times they are a-changin'".

Further reading

• 'The Impact of Electronic Commerce on Market Structure: An Evaluation of the Electronic Market Hypothesis' by E M Daniel and G M Klimis in European Management Journal (Vol 17, No 3, p.318-325)
• Radical innovation – sometimes a new idea changes the landscape, and even well-established companies struggle to cope
• Managing innovation – creativity can make or break an organization – how do companies get the creative juices flowing?

About the author

Elizabeth Daniel is Professor of Information Management at the Open University Business School where she undertakes research and teaching in the fields of e-business and information systems. Elizabeth also undertakes consultancy work for a number of blue chip and leading public sector organisations.

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These difficulties are caused by:

• too much information, much of which is often out of date
• too little information about what is really important to the organization
• conflicting information

The time wasted in reconciling conflicting information has led to many costly investments in large data warehouses (if you don't understand the term "data warehouse", why not put it into Google?) for storing corporate information in a bid to ensure 'a single version of the truth'. However, these have often just resulted in even larger stores of out of date, irrelevant or conflicting information!

Whilst individuals using search engines such as Google to pursue their own interests may be happy to trawl through hundreds of hits to find the information they want, staff within organizations are rarely so patient. So, what should organizations do? Well, whilst technology can help, the most important factor is ensuring that the organization is collecting and maintaining the right information in the first place - after all, the most basic maxim of computer use is ‘rubbish in, rubbish out’.

Lots of organizations have recognised that information is a key asset. Many of these have sought to bring the same discipline to bear on the management of information as to their other important assets. Adhering to the five principles of information management can provide this discipline.

The five principles of information management are:

1. Ownership – all information within the organization should be assigned an owner and that owner’s name should be displayed with the information. Effective stewardship of that information should form part of the individual’s annual appraisal.
2. Identification – the owner should also be responsible for labeling or tagging the information so that it can be classified and most importantly easily retrieved by anyone seeking that information.
3. Lifecycle – as with other assets, information has a finite life. All information should therefore be reviewed at pre-agreed intervals and archived when no longer current.
4. Storage – considerations for information storage should include ease of access by relevant staff – ‘store once, use many’ being the maxim of many organizations – as well as issues of security and business continuity.
5. Audit – finally, organizations should regularly review their use of information including cost and value.

As these principles illustrate, information management is as much about people and processes as about technology.

A wealth of information creates a poverty of attention

Gartner Group has estimated that the digitised information stored within a typical organization has doubled every year since 2000. Effective information management can improve the information available to staff within organizations. However, given this rapid growth in volume, organizations will still need to address ‘information overload’.

One strand of my own research over the last few years has been on the systems that many organizations are adopting to address this challenge: enterprise portals. Enterprise portals seek to do what consumer portals and search engines such as Google do on the internet, that is provide easy access to a multitude of information, but within a single organization.

Enterprise portals can tailor the information presented to staff according to their interests and responsibilities. The relative ease with which other programs or applications can be integrated into enterprise portals ensures that it is not only static information that can be presented to staff. Information from applications such as customer databases, accounting systems and purchasing systems can all be presented through the portal. This feature allows staff who are unfamiliar with the underlying applications to easily access the information they need.

The future of Google: advancing on all fronts

So, the information within many organizations is in a mess. Is this of interest to Google? You bet. In addition to the many other innovations Google is currently pursuing, including internet telephony, mapping and digitising whole libraries, they are turning their attention to helping organizations access their own information. To this end they have recently developed a version of their desktop search tool, which lets individuals search the information on their own PCs in the same way they search the internet, that can easily be rolled out across an entire organization.

Secondly, whilst they already sell both hardware and software that allows organizations to deploy Google search across their own intranets, they have stated, that they are keen to develop these services further ultimately leading to systems similar to current enterprise portals.

The current success of Google has caused some commentators to question if it could even threaten the mighty Microsoft at some point in the future. If Google can build as strong a presence in the enterprise market as it has done in the consumer market, then the unthinkable seems just a bit more thinkable.

Further reading

• Managing information – you’ve got the data, but how do make the best use of it?
• Radical innovation – sometimes a new idea changes the landscape, and even well-established companies struggle to cope
• Mastering Information Management by D A Marchand and T H Davenport, published by FT Prentice Hall
• Information Rules by C Shapiro and H R Varian, published by Harvard Business School Press
• Future Perfect: Findings of an International Delphi Study of the Future of Intranets and Enterprise Portals by E M Daniel, J M Ward and P Miller, published in conjunction with the Intranet Benchmarking Forum

About the author

Elizabeth Daniel is Professor of Information Management at the Open University Business School where she undertakes research and teaching in the fields of e-business and information systems. Elizabeth also undertakes consultancy work for a number of blue chip and leading public sector organisations.

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A safer bet?

So will on-line poker prove to be a better investment than other dot.com ventures?

Sites such as Party Poker can be considered as a type of online marketplace. This is a virtual location where buyers or users can come together to find what they are looking for – in this case, a chance to play poker. In their research on business models for electronic marketplaces, Dai and Kaufman identify three basic functions of traditional markets that online markets would seek to replicate; aggregation, matching and facilitation.

Aggregation is the provision of a wide range of goods and services that enables a buyer or user to be sure they will find exactly what they are looking for. As an example of aggregation, there's the vast product ranges offered by online retailers. Matching is the ability to balance supply and demand and is illustrated online by auctions. Finally, facilitation refers to making the process of buying goods or using the service as easy as possible.

So how do the online poker services address each of these functions?

"It's less intimidating for beginners than walking into a casino"

With 1.8 million estimated to play online poker each day, these services can certainly claim to aggregate players looking for a game. PartyPoker alone has an average of 120,000 players per day. With this large number of users, matching supply and demand becomes easier, as observed by one industry expert "you can always find the game you want, at the limit you want, at any time of day". Finally, it has been observed that the online game is less intimidating for beginners than walking into a casino, facilitating the uptake of the game by many new players and allowing them to play at any time of day – or night.

Clicks or cards

Poker also illustrates another emerging lesson from the online world – the importance of a multi-channel approach. While some businesses have thrived with an online only version, most are finding that a mixture of different communication and distribution channels are important. In the case of poker, the growth in the online game is both fuelling, and riding on the back of, a boom in the game in the 'real' world. Much of this is led by the rise of the game on television. The online poker boom has also led to a resurgence of poker at traditional casinos – and at a time when casinos in the UK are benefiting from the recent abolition of the 24 hours registration period and there is a huge expansion planned in the number of casinos in the UK.

The risks

Whilst the foregoing might all suggest that online poker, and the companies that provide such services, will continue to prosper, there are a number of concerns.

An important risk is associated with perceptions of gambling’s potential for social harm (see for example Gamblers Anonymous or GamCare). For this reason gambling is subject to strict legislation in many countries. In the USA, a major market, the federal government take the view that online gambling is illegal, although this has yet to be tested in court. Given that users in the US currently account for 70% of online gamblers and around 90% of the revenues and profits for some organisations, the loss of their customers would wipe out many of the online providers.

"Their customers, by definition, are not risk-averse"

Another risk comes from the very success of these online offerings – and all the attention they are receiving. Descriptions such as "this spews out cash like you have never seen" – are likely to attract other providers into the market. Strategic theory teaches us if a market has low barriers to entry, customers have low switching costs and it is difficult to differentiate your offering, then competition in the industry will increase, eroding margins. In the case of online gambling, entry to the market can be bought for the price of gaming software and the cost of promoting the service. Whilst excellent execution will always differentiate a good organisation from a poor performer, the only clear differentiation in this market appears to be in the aggregation of players. However, whilst encouraging familiarity and building a brand name can help aggregation, by their very nature, these customers are not risk averse and are likely to be happy to move elsewhere if the thrills and stakes are more attractive to them.

It would appear that investors have recognised such risks in the online poker providers. In September 2005, despite announcing strong growth, over £2 billion was wiped off the value of PartyGaming, representing approximately 30% of the value of the company. Concerns included a slow down in the growth of users, the increased costs associated with attracting new users and the lower stakes and less time spent playing by new users.

Perhaps the most interesting question arising from the online poker phenomenon isn't 'Is this a chance for investors or organisations to make easy money?', but 'Why do we still think that online businesses are immune to the rules that apply to traditional businesses?' It would appear that the answer may be the same as that driving the users of gambling sites – a belief that this time it really will be different!

Further reading

• The online gamble – what rules apply for a business when it moves online?
• 'On-line Retailing: Learning from Experience' by H White and EM Daniel, in Journal of Marketing Intelligence and Planning (Vol 22, No 1, p.10-23)
• 'Business Models for Internet-Based B2B Electronic Models' by Q Dai and RJ Kauffman in International Journal of Electronic Commerce (Vol 6, No. 4, p.41-72)

About the author

Elizabeth Daniel is Professor of Information Management at the Open University Business School where she undertakes research and teaching in the fields of e-business and information systems. Elizabeth also undertakes consultancy work for a number of blue chip and leading public sector organisations.

Wibble

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