VideoInstant Gratification
To advocates of the concept, the real-time enterprise is a giant spreadsheet of sorts, in which new information, such as an order, is automatically processed and percolates through a firm's computer systems and those of its suppliers. Thus a simple inquiry such as, "When is my order being shipped?" can be answered immediately, and not six phone calls and three days later, explains Vinod Khosla, a partner with Kleiner Perkins Caufield & Byers and one of the most notable advocates of the real-time concept. Many consumers have already encountered real-time business without realising it, for instance when they order a Dell computer. The firm's website allows customers to check the status of their order at any time.
But the real-time enterprise is not simply about speeding up information flow. It is also, as GE's example shows, about being able to monitor a business continuously and react when conditions change. Today, businesses "are mostly shooting in the dark", says Michael Maoz, a research director at Gartner, an IT consultancy, and one of the pioneers of the concept. Real-time technology, he predicts, will give firms a window into their business they never had before.
Mr Maoz also emphasizes the third main benefit of a real-time enterprise: using newly available information to offer new products and services. For instance, in 2000 GE's consumer-appliance business installed online kiosks in selected branches of Home Depot, a fast-growing American home-improvement chain. Customers can order an appliance, select a delivery date and time, and be told instantly whether their request can be met.
How does the real-time economy work? First, there is the underlying technology. In the past, firms have faced a trade-off between being integrated and being flexible. New software technology promises to ease that trade-off, or even do away with it altogether.
At the same time, new hardware, such as wireless sensors, makes it possible to gather ever more information about the physical world and feed it into a company's computer systems. Turbines made by GE are equipped with sensors that allow the firm to tell its customers online how efficiently their machinery is operating. Similarly, companies can now collect more data about people, even tracking their location.
By themselves, these data would just contribute to the increasing information overload. But they present a new business opportunity: to develop software that analyses them and suggests ways of optimising the supply chain, or even automates the response to certain kinds of new information. This has already happened in the financial markets, where the availability of real-time data has produced a plethora of firms selling programs to automate trading and make it more efficient.
How will all this change the company and the economy as we know it? IT will probably not spell the death of big firms, as is often forecast. But real-time technology will have a huge impact on the inner workings of companies. It is also likely to make economies more fluid, and perhaps more volatile, as last year's abrupt American downturn suggests. The financial markets have already shown that putting even parts of the economy on autopilot can lead to accidents. A crash in 1987 was caused in large part by automated program trading. Perhaps, one day, the "now economy" will have to have circuit breakers installed.
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