September 19, 1996 -- Virtual companies

Transcript of the live chat session that took place Thursday, September 19, 1996.

These sessions are scheduled for noon-1 PM US Eastern Time (GMT -4) every Thursday.

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For transcripts of other previous sessions and a list of future topics, click here.

For an article on how to make "business chat" work (based on this experience), click here.

Since the chat itself happens at a rapid pace, it's often difficult to note interesting facts in particular URLs as they appear on-line. Here's a place to take a more leisurely look. I've rearranged some of the pieces to try to capture the various threads of discussion (which sometimes get lost in the rush of live chat).

Please send email with your follow-on questions and comments, and suggions for topics we should focus on in future sessions. So long as the volume of email responses is manageable, I'll post the most pertinent ones here for all to see.

For transcripts of other sessions, click here.

Threads (reconstructed after the fact):


Richard Seltzer ( - 12:01pm -- The scheduled chat is on Business on the WWW. If you are here for that discussion, please identify yourself.

We're here to share experiences about doing business on the Internet -- particularly the World Wide Web. What works? What doesn't work? Why? What are the trends that matter? How can you/should you adapt to the Internetculture and environment?

I work for the Internet Business Group at Digital Equipment in Littleton, MA. In that capacity, I end up talking to people from large companies about how they can use the Web for business. I also have my own personal Web page -- which is content rich and no frills -- which I do for practically nothing and draws a fair amount of traffic and attention.

housekeeping -- It can be difficult to follow the threads of conversation. And there's no time to write down interesting URLs and facts. So last week, I took a copy of the raw transcript and edited it to make the threads clearer and posted it at my own little Web site so anyone could take a look. You can see it at I plan to do the same today. Barring technical difficulties, I hope to have a transcript up later today. I'll post it at the same site, naming this one /chat10.html

Nora Ross, ( - 12:03pm -- Hi, Richard. I'm here. Are we still talking about virtual companies? BTW, I do Web site design and development, and have extensive experience in manufacturing logistics.

Richard Seltzer ( - 12:06pm -- Nora -- Yes, we do want to focus on virtual companies/virtual work today. Have you had an opportunity to make use of your knowledge of mfg. logistics on the Internet?

Nora Ross, ( - 12:11pm -- Richard. I was part of a virtual team that put up a commercial site for a client in California & will probably do more work like that. So far, I have not been able to do mfg logistics work, but am developing a promotional site to see if I can generate some interest. . . . It makes such good sense, and overcomes some of the barriers inherent in the client/server model

tom dadakis ( - 12:07pm -- Hi I'm an internet consultant developing an intranet onsite for a corp client in CT

Harris ( ( - 12:06pm -- Nora, I'm looking for help on my web page...

Harris ( ( - 12:09pm -- Richard, I like your phrase "adapt to the Internet culture & environment"--I think that's key; a lot of people seem to want the Inet to adapt to them...what have other people seen happening?

Richard Seltzer ( - 12:12pm -- Harris -- I see two related kinds of mistakes: 1) presuming that you can do what you did before the way you used to do it only now in Internet space 2) getting so excited about the Internet, and feeling so overwhelmed by the opportunities that you lose sight of your business objective, and come to depend on technical experts even when it runs counter to your common sense.

Nora Ross, ( - 12:07pm -- Hi Harris. What kind of web page are you doing? . . . If this conversation ends up being tangential to the discussion, we can continue it via e-mail.

S ( - 12:06pm -- Richard: How do you feel about DEC's Alta Vista spin-off?

Richard Seltzer ( - 12:07pm -- S -- It will be interesting to see how that plays out. They need to be independent to be flexible enough to succeed on the Internet (corporate procedures would weigh them down). Hope they do well. Internet software is a real tough competitive business.

WP How ( - 12:10pm -- Hello all, I'm WP How and it's 12 midnight here in Malaysia. I am part of the Internet Business Unit of Mecomb, a subsidiary of a Malaysian based MNC. I don't think I'm able to contribute much to the topic today but will gladly accept questions.

Anybody really making money on the Internet?

Leon ( - 12:35pm -- Richard, do you think it's true that the only people making any money on the internet are the folks who publish books and hold trade shows about it?

Richard Seltzer ( - 12:38pm -- Leon -- check the banks -- Wells Fargo doing small business loans in NYC without opening a branch there; Security First Network Bank operating with no branches at all (very low overhead) Look at retailers who have niches that match today's audience -- like CD Now. There's lots of folks making more. (Though the real success stories are probably on the Intranet side in business-to-business over the Internet, Digital gets over $200 million in revenue a year from sales to distributors and VARs over the Internet.)

Nora Ross, ( - 12:52pm -- re: doing business on the net - There are two major areas, and they work differently. mass merchandizing - which will be supported by traditional advertising - TV, radio, newspapers, etc. .... establishing an ambience on line that is in keeping both with the company, it's products and it's image ... AND with the target segments they're trying to reach ..... allows for more profitable product/market segmentation and targeting???? The other major area is "internal" the world of the virtual corporation. "Relationships" mean completely different things in those two major environements. ..... and probably "relationships" mean something different within the virtual corp, depending on the nature of the work. 

Virtual Factories

Richard Seltzer ( - 12:08pm -- Welcome, Tom and Harris. Nora -- re: manufacturing, did you see the article in recent Harvard Business Review about virtual factories? [July-August 1996, Vol. 74, No. 4]

Nora Ross, ( - 12:13pm -- The HBR article (virtual factories) sounds interesting. I hope it's in the issue currently on the newstands as I'd love to read it.

tom dadakis ( - 12:14pm -- I did not see the Harvard Business Review. But the just-in-time concept works in virtual organizations.

Richard Seltzer ( - 12:15pm -- Nora -- From the HBR article, it seems like much that is now handled with proprietary mfg. software can be done much better with Internet solutions. My wife used to work for Interactive Group in Burlington that has software of that kind, but still doesn't seem to have a clue about the Internet. It seems there should be a market for knowledge and experience like yours, consulting with software companies like that, before their blindness puts them out of business.

Richard Seltzer ( - 12:16pm -- Nora -- I have the issue at home. It's a couple months old. I'll email you details. (And anyone else who is interested.)

Nora Ross, ( - 12:19pm -- Richard. I am hoping to develop a consulting practice like that. . . . a mix of strategies, reeingineering, and designing/developing sites. BTW, if we never hit carriage return, the lines go on forever (which will be a pain to edit).


Richard Seltzer ( - 12:13pm -- WP -- Welcome. I'm delighted that you were able to connect. (Sorry about last week's technical difficulties.) What business is Mecomb in? And how do you use the Internet?

Harris ( ( - 12:11pm -- Question to WP--how did you learn of this chat?

WP How ( - 12:14pm -- Harris, I firstly discovered Richard's newsletter from a newsgroup posting which led to his site and previous transcripts. That's how I ended up here.

WP How ( - 12:21pm -- Richard -- Mecomb is an engineering and IT based company. Traditional we've been involved in systems integration particularly in process controls, factory automation and security systems. The Internet Business Unit was formed to explore new opportunities in the Internet. We are also involved in building our group's global networking infrastructure.

Harris ( ( - 12:23pm -- .WP, say more about what you think a networking infrastructure is, or should be..

Richard Seltzer ( - 12:24pm -- WP How -- Sounds like you want to move in the direction of the "virtual factory" -- with close and secure connections to both suppliers and customers as well as internally. Do you have an "intranet" today? Are you using leased lines or do you have a virtual private network, using tunneling/encryption to make secure connections over public Internet lines? How far along are you? What challenges are most important to you at this point?

WP How ( - 12:33pm -- Richard -- yep, we have an intranet. We are still on a dial-up line for now. Leased lines are in the pipeline for the whole group once security policies and firewalls have been finalised. "virtual factory" sounds novel provided both suppliers and customers are convinced to set up the infrastructure. Certainly the term has been touted in the local press but may take some time to put in practice. Interestingly, some of the proprietary systems we have already run on TCP/IP and the control system software is migrating in that direction. Currently, we are looking into possibilities of Internet commerce and banking, especially since we have a bank in our fold.

Nora Ross, ( - 12:37pm -- WP - banks, in this country, anyway, are "emotionally split." On the one hand they are committed to, and in a rush to the internet. On the other hand, they are terrified of security issues, and although many are developing lavish sites, few are enabling real transactions. PS. See for more info.

Harris ( ( - 12:40pm -- what Nora just did was great--in the course of addressing a topic, she gave a Web reference...that's quick!!!

WP How ( - 12:40pm -- Nora -- In Malaysia, the banks are very aggressive. Allied Bank has PALWorld, a non-Internet electronic banking system. All you need is a terminal and modem at home. Recently Hong Leong has put up the front for their Internet banking service. All it needs now is approval from the National Banking Authority to proceed with transactions.

Nora Ross, ( - 12:48pm -- WP How - Thanks for the info on banking in Malaysia. I will pass it on to my better half, who does strategic consulting for US commercial banks - and has somehow or another gotten the repuration of really knowing the Net. (I ghost write that stuff. (g))

Richard Seltzer ( - 12:45pm -- WP HOW -- Interesting info re: banks. I think of that as a necessary pre-cursor to large-scale virtual work/virtual companies. It will be important to take care of the financial transactions of such enterprises over the Internet. The more savvy the banks are about this the better.

Richard Seltzer ( - 12:46pm -- WP HOW -- Interesting info re: banks. I think of that as a necessary pre-cursor to large-scale virtual work/virtual companies. It will be important to take care of the financial transactions of such enterprises over the Internet. The more savvy the banks are about this the better.

Harris ( ( - 12:48pm -- "Transactions" are the easy part...we were also talking about "relationships" which involve more dimensions, including the ones Nora named; so when we say "doing business" on the net, we need to look at both--and it's interesting that banking makes a clear distinction between them--you know about "relationship banking"--

Communicating wth more than one other person

Harris ( ( - 12:15pm -- well, right now there are at least 3 threads on the table, so relating is difficult. Can I ask people how they've dealt with communicating with more than 1 other person?---

Nora Ross, ( - 12:16pm -- >> how they've dealt with communicating with more than 1 other person?---

Richard Seltzer ( - 12:17pm -- Harris -- Do you mean -- notes files chat sessions video conferencing mail distribution lists etc?

Richard Seltzer ( - 12:18pm -- Harris - add to the list conference phone calls

Richard Seltzer ( - 12:20pm -- Harris - It seems like mechanisms for talking to more than one person at once -- holding "virtual meetings" is one important piece of the virtual work puzzle. But equally important is how you maintain a record of what transpired in a form that you all can share and add to. (A step beyond sending the minutes to everybody.) Forum or notes type software seems well-suited for that, but I don't see that happening very often. More often the encounter just ends and everyone goes off to do and forget.

Harris ( ( - 12:20pm -- yeah, either realtime or delayed (like this; this is like slow-scan video; it doesn't work for certain nervous systems...maybe if the business is virtual, the relationships need to be actual--whereas in many traditional businesses, it's the relationships that are virtual

Richard Seltzer ( - 12:21pm -- Harris -- can you unpack that aphorism. Sounds very interesting.

Richard Seltzer ( - 12:25pm -- Harris -- " if the business is virtual, the relationships need to be actual--whereas in many traditional businesses, it's the relationships that are virtual" That sounds good, but I'm not sure what it means. Can you explain?

Nora Ross, ( - 12:28pm -- My guess is that Harris is using the word "virtual" in two different senses. For virtual businesses to be successful, the relationships need to be actual, e.g. there needs to be trust, good communications, committment to the work, etc. The reference to relationships being "virtual" in many tradidtional businesses, refers, I think, to some of the cyncism and superficiality of face-to-face interactions. e.g. How many times have you had someone say, "I hear you," with emphasis and sincerity, and then they ignore the agenda you've both obstensibly agreed on?

Richard Seltzer ( - 12:30pm -- Nora -- Good definition. Thanks.

Harris ( ( - 12:32pm -- Nora, we got it! (Does that prove me wrong?)

Nora Ross, ( - 12:24pm -- I've been in an interesting conferencing situation where the main conversation went on in a window like the one we're using now. Then I had seperate little windows open to individuals in the conversation and we were carrying on private commentaries on a number of subjects - including the one at hand. It was amusing and interesting - but only for fast typists.

Richard Seltzer ( - 12:26pm -- Nora -- Do you know what software that was? Sounds like it could prove valuable in a number of circumstances.

Nora Ross, ( - 12:31pm -- Richard, the software is something I _never_ use except for conferencing. It's WinCim, a proprietary package for accessing Compuserv. BTW, I've had some more feedback from MS on NetMeeting, and offers of help in getting it to work right ... + dl'd it to my machine and will pass on info, reviews etc. when I get to it.

Harris ( ( - 12:27pm -- Nora, I like the multiple windows--but it would need icons or shorthand code...typing is a primitive form--who is developing the equivalent of ASL (sign language) for online chats?

Richard Seltzer ( - 12:29pm -- Harris -- I wouldn't look for icons of shorthand code (other than what's common on the Internet already -- :^) But I would like to combine this with voice. I'd like to be able to conduct on con-call conversation with voice and carry on related dialog in chat, and have it all recoverable/savable as transcripts.

Harris ( ( - 12:30pm -- Richard, there's a lot of nonverbal cues when people are interacting...that's the hidden dimension that Edward Hall wrote, you've got none of that to address the social/organic cues which provide context, inflection, etc....Most work relationships are quite superficial; it's the business agenda that is substantive...

Contrast with Face-to-Face

Richard Seltzer ( - 12:32pm -- Nora and Harris -- I find that the more people are involved in the Internet, the more they seem to need to get together face-to-face. There's an incredible number of shows, seminars, and conferences all on Internet topics. It seems to me that the Internet speeds up the time to decision, but does not do away with the need for face-to-face. Therefore, I'd suspect that any broad virtual work/virtual company scheme could/should include regular face-to-face as a component. Can anyone out there provide some specific numbers or guidelines in that regard?

Richard Seltzer ( - 12:35pm -- Nora and Harris - It seems that the need for real relationships to make a virtual company work is related to the need for face-to-face encounters to complement the on-line. That means that those planning to move in such a direction can't just presume that the cost of travel etc. will go down. I believe that the benefits come more from 1) arriving at decisions quickly 2) arriving at better decisions because the right people are involved 3) getting work done more quickly and effectively because of the ability to call on a broader base of workers.

Harris ( ( - 12:38pm -- But Richard--"arriving at decisions quickly" is not for everyone..many people are not "quick on their feet" and they're less quick on their presently conducted, Internet activity screens out many qualities of people and leaves--who? the fast typists?

Nora Ross, ( - 12:39pm -- Richard, for my virtual project, I've never met any of the other principals face to face. We have talked on the phone a lot though. This may sound sort of strange, but there's a large community of people out there who have been on-line for years, and after a while you get so you know who's good and who isn't. (that wasn't real tactful, but writing it tactful would have taken forever.)

Richard Seltzer ( - 12:40pm -- Harris -- Fast typing is only a characteristic of chat (what we're doing now). That's one very small piece of interacting over the Internet. (And I love to type :^)

Richard Seltzer ( - 12:42pm -- Nora -- Interesting point. My experience at Digital has been the opposite. I see more and more face-to-face meetings, with lots of on-line followup. It may very well depend on the type of work. If you are working for a single person/client and have a clear task to accomplish and the results can be delivered/ seen/reviewed directly on-line, there would be far less need for face-to-face.

Nora Ross, ( - 12:43pm -- Harris, I enjoy chats like this, and I do type fast. I agree that is a prerequisite for things like this. I think, however, that for substantive on going conversation - the kind where issues are defined and progress is made, - those are best conducted via forum discussions - that is short posts that are focused. In that way, people have time to reflect and reply. It's sort of what exchanges of memos were supposed to do, but don't. .... maybe the closest thing is some of the good e-mail networks that have been around companies like DEC for a long time.

WP How ( - 12:45pm -- I agree with Nora. Short posts, forum style rather than on-line chat.

Richard Seltzer ( - 12:47pm -- WP How -- Yes, Forum lets you have time to reflect, and it's good to have the discussion arranged in threads. But chat has the advantage of immediacy. I find I procrastinate and never get around to posting my thoughts in forums, but for chat you have to be on-line at a certain time, and the fact that others will be there then is what draws you. I want to see the good points of these tools merged. (That's why I do the edited transcripts the way I do.)

WP How ( - 12:50pm -- Richard -- Here's an opportunity for a software developer to write a chat/forum software :-)

WP How ( - 12:54pm -- Richard -- I just had a thought. 'virtual relationships' may get off to a better start via a "common" platform provided by the Internet. Less of a chance for you to offend someone from another culture by your mannerisms. Perhaps a plus for international relationships.

Harris ( ( - 12:56pm -- WP's comment brings me back to Richard at the beginning: "Internet culture"--but people from some cultures have more of a problem with the Internet than others (it violates norms, taboos, etiquette--)

Richard Seltzer ( - 12:58pm -- Harris -- But the violations are all clearly forced by the medium, so the parties soon come to take them for granted. This awkward typed medium is a common ground. (There are advantages to low- tech.)

Richard Seltzer ( - 12:57pm -- WP How -- Interesting insight. I agree. I used to be a writer for magazines and I found that telephone interviews went far faster than face-to-face ones. It was easier to get right to the point and move one, while face-to-face there was always the need for numerous formalities -- so aside from the travel time, the actual interview (recorded) went much longer and was more diffuse. I find that on-line communication is even more compact than phone -- excellent for getting right to the point.

Nora Ross, ( - 12:59pm -- re: getting right to the point. .... so maybe the internet virtual management teams for getting stuff done? ..... this is effective after the front-end face-to-face negotiating and settling of objectives has been completed?

Harris ( ( - 12:59pm -- oh, Richard, I've been on the other end of being interviewed; and it's much worse on the phone than in person for me as interviewee--(I was on the front page of Wall St Journal last week--what little the reporter could retain on the phone....

Richard Seltzer ( - 1:02pm -- Nora -- I agree, there are different roles for face-to-face and on-line and the better we understand the differences...

Topic for Next Week -- International?

Richard Seltzer ( - 12:59pm -- All -- Would there be interest in pursuing the notion of international business via the Internet (virtual work or otherwise) in a coming session? I'd love to get some real experience/examples.

Harris ( ( - 1:01pm -- International yes! I'll be in Russia in December...

Wrap Up

Richard Seltzer ( - 1:00pm -- All -- Time is running out. Remember -- I'll post a transcript later today at Also please send me email with your suggestions and further thoughts. or

Richard Seltzer ( - 1:01pm -- All -- Please take a moment to post here your email address and URL (if you have one) for followup conversations.

WP How ( - 1:02pm -- Harris -- can you give some examples of the cultures and the problems? I think I'm a bit lost here.

WP How ( - 1:03pm -- My email is

Harris ( ( - 1:03pm -- yes, WP, I'll email you--go to sleep...

Nora Ross, ( - 1:01pm -- One of the limitations of this medium. ... Just as we're all starting to have fun, it's time to turn into pumpkinds. ... See you all next week..... Nora

Richard Seltzer ( - 1:03pm -- Thanks to all. Yes, sorry we have to turn back to pumkins. Hope you'll be able to connect again next week. Same time. Same URL. And please let me know your suggestions for further discussion -- particularly any leads you have regarding international business.

Follow up discussion

From: Harris Sussman <>

Date: Wed, 18 Sep 1996 13:02:27 -0700

Richard--you know, a baseline definition might be useful for the chat --like, what do you/we mean by "virtual"--do we mean computer-mediated, electronic? I say this because so much discussion was about the computer technology and so little about what you asked me to contribute, the sociology/psychology.

"Virtual" also suggests displaced/anyplaced (not colocated), not physical (metaphysical?)--for some, it borders on being abstract, therefore not real/actual, therefore not valid. Years ago when I was talking about virtual organizations and virtual work at Digital, people in corporate were leery, cautious, resistant. My conclusion was they didn't understand their own medium (computers). Telecommuting was exotic to them--they were suspicious, distrustful, of it. OK--now we've at least got George Gilder's Telecosm and James Martin's Superhighway Corporation, etc. So where along the spectrum are we having our chat?--about how to optimize it? Then let's talk about our optimal criteria. Or do we want to discuss some of the protocols of interrelating? Or are we discussing the politics or strategies for virtual activity? Let's pick any one and at least have a moment to complete a thought process about it--otherwise, we're letting any good memes/themes get away before they have a chance to land. Harris

From: Richard Seltzer <>

Date: Wed, 18 Sep 1996 15:42:52 -0401 (EDT)

Since the overall topic of the chat sessions is Business on the WWW, the main thrust would be the kinds of virtual work that the Internet helps make happen. I'm personally more interested in the human aspects -- the technology makes certain work style possible; what do people have to do to make them effective? I'd very much like to hear examples/experiences -- what worked and what didn't and why.

> "Virtual" also suggests displaced/anyplaced (not colocated), not physical (metaphysical?)--for some, it borders on being abstract, therefore not real/actual, therefore not valid.

Today "virtual" has positive rather than negative connotations. It's an "in" word. Companies dealing with the Internet use it and misuse it all the time. There's an assumption that once you connect people over networks they suddenly can form "virtual teams" -- like assuming that because you give a bunch of people hammers and nails they'll be able to build a house.

> Years ago when I was talking about virtual organizations and virtual work at Digital, people in corporate were leery, cautious, resistant. My conclusion was they didn't understand their own medium (computers). Telecommuting was exotic to them--they were suspicious, distrustful, of it.

They would still be distrustful of it -- but necessity forced them to broaden their minds. Today, nearly all of Digital's sales force telecommutes.

> OK--now we've at least got George Gilder's Telecosm and James Martin's Superhighway Corporation, etc. So where along the spectrum are we having our chat?--about how to optimize it?

That's what I'd like to get at. But we have to be as concrete (experience oriented) as possible. I don't want to just talk about the latest Internet-based teleconferencing software. I'd rather like to get at what you do once you have such software. How do you manage? How do you work? What's really different about it?

> Then let's talk about our optimal criteria.

I'm not sure what those criteria are, would certainly like to hear your ideas.

> Or do we want to discuss some of the protocols of interrelating? Or are we discussing the politics or strategies for virtual activity?

You know much more about the subject than I do. I'm coming at it from a gut-feel common-sense point of view. Anything you can add along the lines of protocols of interrelating or strategies for virtual activity would be greatly appreciated.

Keep in mind that if you have your ideas in written form on your PC, you can cut and paste them (paragraph by paragraph) in the chat area.

> Let's pick any one and at least have a moment to complete a thought process about it--otherwise, we're letting any good memes/themes get away before they have a chance to land.

That's the direction I want to head in -- focus on a question or two and get some useful thoughtful answers. But we're dealing with an anarchic wide-open medium and have to respond to the interests and inclinations of the folks who happen to connect tomorrow.

It should be fun.

From: Marlae Rindlisbacher Sent: Tuesday, October 15, 1996 8:40:10 PM

I am a student at BYU in Provo, UT studying Public Relations. I was surfing a bit looking for ideas to bring to my web publishing class when I came across your page. I just started reading it, in fact I haven't yet finished it but I'd like to get my thoughts down before they leave. I was reading a chat session which took place on 9-19 about business on the WWW. This interests me very much. My dream is to live in Page Arizona (Lake Powell) or somewhere else just as remote and 'telecommute' to work over the internet.

I am also in the middle of writing an article for a newsletter on how technology is (or more likely isn't) being used in the classroom. I work at Media Services on campus and I know what is available for professors and the implications technology has on the learning environment. Unfortunally too many professors still teach with a piece of chalk and a blackboard.

To me the most exciting part of technology in the classroom is the 'virtual university'. Governor Levitt of Utah has nearly completed his dream of the Western Governers Univirsity. WGU will incorporate over 900 colleges and universities from 13 western states and will be the largest distance learning experiment ever.

Finally, I am very interested in where the internet is going. I've heard a lot about different cable and communications companies putting the internet on their cable lines and the pros and cons of doing so.

I hope to check in at the next chat session but I'll probably be in class or something. I've bookmarked this page and I'll check back often.

I'd like to see these interests of mine discussed, that is if you need any topics of discission.

Feel free to email me at Marlae_Rindlisbacher@BYU.EDU.

Thank you

Tony Cox (My Name)

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