How Digital Is Your Business?

By Adrian J. Slywotzky and David J. Morrison. Crown Business, 237 pages. $25.00.

The book's title question is a critical one in today's economy, but Slywotzky and Morrison -- authors of two recent, widely acclaimed books, The Profit Zone and Profit Patterns -- insist that the answer isn't merely a matter of technology infrastructure. Becoming a digital business, they write, involves more than setting up e-business units, having a terrific Web site, developing great software or "wiring" your workforce. Rather, "it's about using digital technology to become unique... to create and capture profits in new ways."

"Unique" is a much-abused word, but the authors really believe corporations need to embrace a singular vision of how to leverage technology. Digital strategies build on existing ones and will fail unless they offer differentiation, create new business models that capture profits and "develop powerful new value propositions for customers and talent," they argue.

Slywotzky and Morrison, consultants at Merger Management Consulting, take the generic to the concrete with useful examples drawn from old-line icons, like General Electric and IBM, that are adapting to the demands of e-business, as well as from newer firms that the authors say have successfully figured out how to "digitize" their business plans, like Dell Computer, Cisco Systems and Charles Schwab & Co. There's even an extensive profile of a very unusual entry for a U.S. business book -- Cemex, the Mexican cement company.

The book was written recently enough to incorporate the rash of business-to-consumer dot-com failures, which the authors argue stemmed principally from poor business designs. "Digital business design is about business first, design second, and digital third," they write. With sound advice and an authoritative voice, How Digital Is Your Business? stands out in a thicket of books about the New Economy.