Firms 'need digital creativity'

January 9, 1998

If you want your business to succeed, make creative use of the new digital media. That is the latest word from James Short, associate professor at the London Business School and guru of the early-1990s craze for business process redesign.

Then it was databases, networks and groupware that Dr Short and Thomas Davenport told companies to adopt as they streamlined their office work. A similar message came from Michael Hammer, who introduced the term "re-engineering" only to see it rapidly become a euphemism for job cuts.

Then the Internet burst onto the business scene, with digital broadcasting hot on its heels. Businesses saw that in future, increasingly they would find and interact with their customers through the new digital media. Mundane stuff like names, addresses and order numbers would flow through the wires as ever, but success would depend on dressing up the transaction with the right sounds and images to create a compelling interactive experience or make the customer feel part of a community. Cue the creatives - the new business heroes set to supplant hotshot programmers and software wizards.

Dr Short's latest venture is i:Lab (www.ilab.lbs.ac.uk), a new media research and education laboratory with outposts on both sides of the Atlantic. The London base of the operation, in a loft on the LBS campus in Regent's Park, includes a production facility which will employ some of London's talents in creative arts, design and new media. The United States outpost shares space and resources with the Institute for Technology and Enterprise established last year by New York's Polytechnic University. It is located in the New York Information Technology Center (www.55broad.com), a high-tech building in the Silicon Alley area of Lower Manhattan. The other tenants include the Sun Microsystems Java development team, Ericsson Cyberlab, and the Web music retailer N2K.

The London studio was set up by creative director Adrian Sack and associate director Fergus Lynch. With help from 25 founding sponsors it has been equipped with Silicon Graphics Octane workstations, 21-inch screens, multimedia authoring software, cameras and other digital media kit. It has fast connections to the media industry's Sohonet and academia's London Metropolitan Area Network.

The sponsors include leading firms in information and new media businesses, a couple of which have been in the news this week. IPC Magazines management successfully bought out their company from Reed Elsevier, while Netscape Communications announced losses in excess of $100 million for the year. Other well-known names on the list are AltaVista, Apple, BT Labs, CNN, Electronic Arts, ICL, Oracle, Reuters, Silicon Graphics and Turner Broadcasting System. Together, they have so far invested Pounds 700,000 in cash and in kind.

Students often ignore the role of new media in business strategy. When Dr Short shows them the amazon.com bookselling site and asks them how they would try to compete, their answers centre on price, costs and marketing. "Few of them talk about the actual design of the website as part of the strategy that you would use to compete with amazon.com."

The 62 second-year MBA students who start Dr Short's Information Businesses course next week will be able to watch top multimedia and Web designers at work in something like their natural environment, and try the equipment themselves. Dr Short hopes that when they graduate they will be better equipped to work in the new media development companies which, up to now, have been reluctant to hire MBAs.

The lab will also be used for research by business school academics trying to keep abreast of developments in a fast-moving and sometimes mysterious business. Business schools have traditionally gathered knowledge by observation, but Dr Short favours a hands-on approach. "Much of the knowledge is not in the schools, it is in the market," he said. "Businesses have engagement. It is from engagement that knowledge comes."

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