E-commerce a numbers game

The numbers are mixed, at best, on the extent of the country's eagerness to trade electronically. The inconsistency in the statistics - not to mention lack of detail - is enough to make a commerce minister wish for more precise figures.

The numbers are mixed, at best, on the extent of the country’s eagerness to trade electronically. On the one hand we have the United Nations ranking New Zealand third in the world in its e-government index, published in June. But on the other a recent study shows we’ve gone backwards in the use of the internet for transacting business.

Such inconsistency – not to mention lack of detail – is enough to make a commerce minister wish for more precise figures.

That’s precisely what Paul Swain, the minister in the pre-election regime, signalled last month: that he would be talking to Statistics New Zealand about the collection of more useful numbers on e-commerce uptake. But Computerworld inquiries suggest we’re not about to be deluged with highly detailed statistics on the subject.

Statistics NZ will shortly circulate its Annual Enterprise Survey, which asks financial questions of about 20,000 businesses. A question on the proportion of goods and services sold over the internet will be appended to that survey, but it could be as long away as September 2003 before the answers are known. Whether the responses are that meaningful is another matter: the number-crunchers point out that organisations don’t necessarily separate the business they do online from that transacted traditionally.

Another initiative under way is preparation of a business case for a study on use of IT and the internet within New Zealand firms. If that gets the nod – the views of government agencies like the Ministry of Economic Development, E-commerce Action Team and Ministry of Research, Science and Technology will be sought – it’ll be a good six months before any numbers are forthcoming.

In the meantime, what do we have to go on to gauge e-commerce activity? Last June Statistics NZ conducted a Business Practices survey to measure use of IT. It asked what proportion of total sales respondents were transacting online and came up with the low-seeming figure of 0.3%. If that leaves you thinking we’re a land of e-commerce retards, not so, says Statistics NZ: the figure was in line with Australia and Canada.

All the same another piece of research, carried out this year by Waikato University and alluded to earlier, recorded much higher figures, although down on results from 2001. According to the 2002 survey of 1057 executives of companies with websites, online purchases accounted for 4.7% of the total (down from 5.5% last year); sales over the web accounted for 5.1% of the total (again, down from 5.5% last year). You might think that given the disparity between these and the government statistician’s figures that Statistics NZ wouldn’t place much store by them. But not so: the department notes them without calling them into question, while also saying that if e-commerce is to become an important feature of the New Zealand economy, its measurement needs to be incorporated in the national statistics system.

All of which leads me to wonder what will really kick e-commerce into life? The business-to-consumer side is relatively simple (and comparatively unimportant): it will build as buyers learn to trust online payment systems. The harder part — and where the serious money will flow — is between businesses. They key here is providing links; converting paper-based processes into electronic ones and making sure that those from disparate organisations are meaningful to one another. For this, document translation services are vital. Computerworld has written about one such service, from Australian company Pacific Commerce, which was to provide document mapping to enable public hospitals and their suppliers to trade electronically.

But things never move as fast as hoped: electronic transactions were to have begun flying back and forth between two Auckland hospitals and five of their suppliers a couple of months ago but other priorities took over, delaying the system mapping process.

Even so, the reason New Zealand ranks so well in the UN report referred to earlier is that we, the citizenry, can apparently carry out secure electronic transactions with government agencies. (Aside from being able to query Companies Office records online, I can’t think of too many other live examples of e-government. Can anyone suggest others?)

The same mapping function the Australian outfit is ready to perform for our hospitals is now available for small and medium-size New Zealand companies. It’s called, appropriately enough, Decode and is being provided by Conduit, an offshoot of IT products distributor Renaissance. Conduit came into being when Renaissance realised the commercial potential of the system it had built to enable e-commerce with its resellers. With Decode, it’s taken another piece of that puzzle and hopes to repeat its success.

If it does -- and New Zealand businesses take to Decode and similar services — the next batch of e-commerce statistics we see should show a big jump in activity.

Doesburg is Computerworld’s editor. Send letters for publication to Computerworld Letters.

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