BUSINESSWEEK ONLINE : MARCH 22, 1999 ISSUE
BUSINESS WEEK E.BIZ

Go Ahead, Farm Out Those Jobs
Plenty of outfits can help companies crack the Web fast

Speed kills-if you don't have it. Whether it's product development, marketing, or customer service, there's no need-or time-for companies to try to do everything in-house.

''E-commerce is putting a supercharger on the pace of business,'' says Jeff McKeever, chairman of MicroAge Inc., an electronics distributor that is using the Net to move faster.

In the computer industry, you used to be able to tell the technology pioneers by the arrows in their backs. Those who took a more measured pace, pushing widely used products such as IBM-compatible personal computers, were the ones reaping the rewards. But the Net has turned that notion on its head. Now, the E-business innovators such as Amazon.com (AMZN), Yahoo! (YHOO), and eBay (EBAY) are cashing in on lofty stock valuations and heavy traffic flowing to their Web sites. ''We were first to market, and it was a huge advantage,'' says Stuart Wolff, CEO of RealSelect Inc., which attracts 6 million people a day to its REALTOR.com Web site, where 1.2 million homes from around the world are posted for sale. ''People who don't understand the importance of speed are making a huge mistake.''

LIGHTER LOAD. Think Internet time. Hire help--there's plenty. For every wannabe.com, there are scores of companies eager to run entire online businesses or take some of the load off by handling just one cyber operation--say, E-mail--for a fee. Instead of spending six months to build a portal site for your employees or customers, software from San Francisco-based startup Epicentric, for example, can do it in a few days. Or tiny Be Free Inc. in Marlborough, Mass., helps you set up virtual sales booths on more than 100,000 sites. Need to turn on more computer power--fast, and only when you need it? Interpath Communications Inc. can host your Web site at its computer center where it can handle peak loads.

Moving fast can also mean spending less. Take RadNet Corp., a 3 1/2-year-old company that makes radiology data in hospitals available to nearly 600 physicians. About 18 months ago, the company decided to make its services available over the Net, instead of just through private networks. Management wanted it done this year. But an internal technology group estimated that it couldn't complete the job before 2001 because of all the staff it needed to develop new software and systems. That wouldn't do. RadNet hired Interpath Communications to develop and host the Web site--for one-third of what the company figures it would have cost in-house. Says Al Majkowski, RadNet's founder and chief technology officer: ''We can't be burdened by having to build a large IT [Information Technology] organization.''

It's not just about getting into cyberspace quickly. Once on the Web, companies have to keep moving fast. Consider distribution. ''Anybody can build a Web site and take orders,'' says David Crampton, president of PC Flowers & Gifts Inc., a Web site that takes about 110,000 orders a year. ''The biggest challenge we face is the shipping, the fulfillment end of our business.''

Fortunately, there's help. Companies are ditching company-owned trucks and outsourcing to United Parcel Service, Federal Express Corp., and the like. UPS and FedEx both consult with E-business players to help establish shipping procedures. And they've opened up their databases so these customers can track their packages from the Web. The day before Christmas, 1 million people checked on their UPS packages over the Net. Now, imagine how many people will be checking next Christmas. Will you be quick enough?

BY IRA SAGER
Contributing: Peter Elstrom

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