Living in a tech-savvy state that hosts most of the world's top software giants would seem to place the Republic at the forefront of the e-revolution. But, with only 10 per cent of Irish businesses currently using the web for online transactions, there is little room for complacency. Companies in the traditional manufacturing sectors and small enterprises are probably the slowest to adapt to the new economy, according to Mr Pat Maher, development director with Enterprise Ireland. Research shows awareness of e-business is very high among Irish companies, but a lot of these don't know how to adapt to e-business, he says. "This includes companies in the food, consumer products, print and furniture industries," he says.
Mr Maher cites a recent Enterprise Ireland client survey, which shows almost half of surveyed companies do not have a website and 80 per cent have yet to redesign their business processes to facilitate e-business.
However, he hopes a pilot programme introduced by Enterprise Ireland - a £10 million e-business acceleration fund - will promote a more speedy adoption of the concept of e-business. The whole idea about providing grants to companies to develop e-business initiatives is to get Irish businesses to adopt these methods, says Mr Maher. "Companies must realise e-business is not just a bolt-on application but something companies need to integrate their whole business around."
The e-business accelerator fund, which will give out grants of between £100,000 to £250,000, was established to support companies that are planning to integrate an e-business strategy into their operation. It is run on a competitive basis and is intended to promote initiatives in e-business. The fund is skewed towards small Irish companies in the traditional sectors of the economy. Larger firms or IT companies may get funding, but typically only when their proposals encourage sector-wide emulation or adoption of e-business, says Mr Maher. Some 96 companies applied to Enterprise Ireland for the first tranche of £4 million in funding in August. Each company put forward a proposal focusing on one or a number of e-business applications, including customer relationship management initiatives, procurement over the Web and projects to develop new direct consumer marketing channels. The proposals varied widely. One was for a joint initiative in the furniture sector for an interactive website that would enable customers and suppliers to access project information by using a 360 degree virtual room. Another was an e-commerce website for the construction sector.
The proposals were judged earlier this week by the e-business accelerator committee on several criteria, including the impact the proposal would have on the overall business, the effect it would have on its suppliers or customers, the ability to part-fund the venture and the management approach. It is understood Enterprise Ireland will sanction awards for approximately 50 of the 96 firms that applied for the first round of funding. The successful companies will not be announced for several weeks. The response to the initiative was incredible, according to Mr Maher. "If the number of proposals for the second tranche of funding exceeds the figure for the first, we would consider extending the programme and offering another £2 million or £3 million funding," he says. Priority for the second round of funding, the deadline for which is September 29th, may go to regional applicants, as over 50 per cent of applicants in the first round came from the eastern and Dublin regions.
Mr Maher points to the protracted time period before companies can see the full benefits of adopting an integrated approach. "Companies must not lose heart with their e-commerce plans. Over a three-year period, there is a curve effect where initial enthusiasm can dip before the full benefits of the strategy can be seen," he says. "But e-business can offer substantial savings in manpower and efficiency." Developments in the Republic within the past year should drive the adoption of e-business much faster, according to Mr Maher.
