DATE: Monday, October 13, 1997              TAG: 9710110699

SECTION: BUSINESS                PAGE: D1   EDITION: FINAL 

SOURCE: BY AKWELI PARKER, STAFF WRITER 

                                            LENGTH:  113 lines

AHEAD OF THE PACK PROGRAM PREPARES COMPANIES FOR ELECTRONIC COMMERCE

In the minds of some folks, giving out a credit card number online ranks with activities like skydiving over an alligator farm or proudly waving Old Glory down Main Street - in Tehran. Novel, but not exactly prudent.

Many businesses, meanwhile, are turned off by the steep learning curve and hit-or-miss profitability of so-called electronic commerce.

And yet, the medium's popularity continues to swell as consumers discover its convenience, and business milks it for all its cost-cutting worth.

Christopher Newport University in Newport News, which operates a regional computer network called SEVAnet, is so sure about prognostications for e-commerce growth that it's offering a five-course certificate program in the specialty.

For area companies and government employees, it may shed some light on the question many face after going online: Now what?

Bill Muir, SEVAnet director, says that area companies have clamored for the classes, which are open to anyone for $160 per course.

The six-session courses include Introduction to Electronic Commerce, Basic Web Page Development, Online Business Principles and Practices, in-depth study of an electronic commerce topic and a capstone course.

Like the field itself, organizers say, the curriculum is dynamic and likely to change.

It took just a month to develop a curriculum and get a class going - warp speed for academia, where the process normally takes about a year.

``We have to be nimble,'' said Muir. ``We have to be responsive to what the business community needs.''

You don't need an office in the executive suite to see why corporate America is drooling: Business-to-business commerce on the Internet - excluding the billions of dollars in exchanges on privately run networks - will explode from $8 billion today to $327 billion in 2002, predicts Forrester Research in Cambridge, Mass.

This year, says Forrester analyst Steve Bell, Web-based business will probably be limited to ``early-adopter'' companies - either high-tech firms or companies with niche products that sell easily online.

But by the year 2000, he says, ``everybody will be doing it, and if they're not, you'll ask them `why?' ''

In its broadest sense, ``electronic commerce'' encompasses a range of technologies, from the still-evolving World Wide Web to the comparatively primitive fax machine.

The first class offered, Introduction to Electronic Commerce, surveys those technologies, including smart cards (the plastic with the chip that could make bills and coins obsolete) and EDI, the technology that sparked somewhat of a back-office revolution in the 1980s. Short for Electronic Data Interchange, the decades-old technology uses standardized electronic forms to conduct business transactions.

Companies like Kmart and Honda make suppliers use EDI as a condition of doing business; not only does it save them paper and labor, but inventory cost, too.

It's been a boon to just-in-time delivery. A computer at Kmart can tell a computer at Rubbermaid when the store is running low on plastic containers and have them shipped without a human ever getting involved. Some companies refuse to sell their products to non-EDI users, says James Tarr, teacher of the CNU course and a former quality control manager who once had to implement EDI.

``Even suppliers can say, `You're going to cost us so much money we don't even want to deal with you,' '' says Tarr.

Electronic commerce may not be for everybody just yet, but it paid off for Peninsula Software of Virginia Inc., a Newport News maker of payroll software for PCs.

``We were pretty much a natural for it,'' Peninsula Software President Leroy Newman recently told Tarr's class.

The company already had customers nationwide, and its product - software - lends itself to marketing on the Web. Before buying, customers can download the product and try it free for 30 days.

``As of today, we have 170 end-users that we can tie specifically to the Web,'' says Newman.

He figures the company will pull in $150,000 to $200,000 a year on sales from just the Web site.

Governments are getting in on the act as well, from the feds on down to municipalities.

Perhaps the most visible example has been the switching of federal disbursements like Social Security and government contracts to the Electronic Funds Transfer method. Since July, all new federal payments except for tax refunds must be electronic. By 1999, all federal payments will be made that way.

The Treasury department says the move will cut down check fraud, a $65 million headache for the federal government in 1996. In addition, says the Treasury, EFTs will save taxpayers about $100 million in red tape.

Tom Andres, a management analyst with York County, says he's taking the SEVAnet course for ideas on ways to make county services more efficient and more convenient to taxpayers.

For instance, letting residents pay their taxes or register to vote over the Web. Or letting businesses apply for various permits online instead of standing in line.

``The only real issue is security, and the fantasy is a lot worse than the reality,'' says Bell, of Forrester Research. ``There has never been a documented case of someone losing a credit card number en route on the Internet.''

Most of the handful of electronic credit card heists came as a result of hackers cyber-jimmying their way into corporate servers - like robbing the bank instead of the armored truck.

Tarr compares the situation of electronic commerce to that of other technology leaps, like electricity or television. Says Tarr: ``The computer is still new enough so that it's not pervasive like the television set is. Once people accept it, this hesitancy of giving up their credit card number is going to vanish.'' ILLUSTRATION: Color photos

LAWRENCE JACKSON/The Virginian-Pilot

Leroy Newman of PC-Payroll...

IAN MARTIN/The Virginian-Pilot

Tom Sawyer...

James Tarr...

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