Foresight in e-business

Remember Bernard M. Baruch, the world-famous business guru, who once said, "During my 87 years, I have witnessed a whole succession of technological revolutions. But none of them has done away with the need for foresight of the business practitioner, or the ability to think."

The same sentiment was echoed by Gloria Steinem, well-known American feminist leader, who said during her crusade for equal rights for women, "Without leaps of imagination, or dreaming, tempered by keenness of foresight, we lose the excitement of possibilities. Dreaming, after all, is a form of planning, and the rational foresight to know how to clinch your dreams assures their success."

In the field of e-business, these quotes are so relevant. For, after all, e-business in whatever form, and whatever the purpose, needs the foresight of the e-planners to be able to know what will succeed, what will seduce the customer to patronize their enterprise, and the ability to devise, in fact, invent and discover the particular e-business dimension that will bring in the millions and the billions.

This is what carried Microsoft’s Bill Gates, college dropout, to use his genius and his amazing foresight to build the e-empire the whole world has been witness to. This is also what the most well-known and successful Filipino technology innovator in Silicon Valley, Diosdado "Dado" Banatao, achieved.

But the foresight to evolve something that will lead to success must be balanced by the keen foresight to know the pitfalls, dangers, or perils the innovating e-business could encounter. Usually, these perils fall into the lap of the lawyers.

There is a leading e-business consultant, Pricewaterhouse-Coopers, whose auditing specialization has branched out to a flourishing international law practice composed of more than 1,000 attorneys outside the United States, including the Philippines, where, they have a local auditing firm as partner.

When I was in San Francisco in April this year, I had the opportunity to talk to one of them. He gave me a paper in which his firm identified nine e-business areas that are particularly sensitive and prone to legal difficulties. These are e-business structuring; protection of name and reputation; content control; management of identified legal risks; compliance questions; protection of assets; assurance of enforceable transactions; privacy policies; and formation of alliances.

I was told that quite a number of cases have shown that the lack of foresight to consider any of the areas just mentioned in the Pricewaterhouse-Cooper legal strategy for e-commerce has led to some real legal problems. We discussed how an e-business became the subject of a suit because it commercialized an information service via the Internet that it did not own. And there have been a lot of cases where the particular e-business gets in trouble because it neglected to procure the necessary regulatory authorizations to offer those services.

Counsel for e-businesses is appreciated and lawyers’ reputations for effective provision of legal services to e-business spreads fast in the e-commerce world, if they are proactive due to their keen foresight.

It is therefore essential and of great value if the e-business legal department or its legal retainer addresses right away those questions that have to do with the protection of the e-business name; reputation and assets; enforceability of the transactions to be entered into; the issues that go with business transformation and the management of liability risks and effectivity of Internet content control at the outset. One of the most important to address proactively has to do with compliance and privacy issues.

To be able to accomplish the above, an e-business should ensure that its legal department or legal counsel right away determines, and with certainty comes out with the assurance that the e-firm’s business activities are lawful in each jurisdiction where their e-business is present.

Towards the end of my stint at the Department of Transportation and Communications sometime in 1999, the problems of the new e-business were discussed in a forum in Geneva under the aegis of the Italian government. The two Italian experts, both being technical IT experts, asked me to sit in front with them to tackle any legal issues that would arise after their presentation ended. I gladly obliged, because I was of course aware of the very concessional loan the Italian government had just provided our government.

Most of the issues dwelt on jurisdictional matters falling under international law, and there were quite a number. I myself did not realize until then the magnitude of the jurisdictional issues that could arise in our borderless global community.

It has become quite evident that e-business has led to the creation of new categories of assets, and no one can argue with the statement that the global nature of e-business increases the risks that will be encountered and that e-business assets are more vulnerable. In other words, that valuable element of keen and sharp foresight is necessary in the planning stage to avoid pitfalls.

Should an e-business’ legal department consider the above issues, quite a number of dimensions will naturally arise, such as: a) how will the e-assets be given the necessary protective mantle from the evils of infringement?; b) what legal devices have to be undertaken to protect the e-business brand?; c) are safeguards in place to take care of any new risks?; d) is the e-trade being pursued susceptible to legally enforceable agreements?; e) what about the sites/venues of the e-business offices, people and servers – will they make a substantial difference as far as tax liabilities are concerned?; f) how can the e-business legally minimize the liabilities associated with errant Internet site content?; g) with regard to compliance standards of different jurisdictions, which can be legally ignored? h) how can the e-business privacy principles forestall legal difficulties?

Aristotle once said, "A good solution applied with vigor now is better than a perfect solution applied a day later. And this is where one’s keenness of foresight comes in."

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