uch has been made in recent years of the notion of business as war. In the late 1990s, executives and management gurus took to quoting from Sun Tzu’s The Art of War. The business press joined in, with headlines about mortal combat in the e-commerce sector, “death-spiral” financing, and trench warfare in investment banking.

In light of the events of September 11, a day on which many people engaged in utterly peaceful business became victims of a new and horrible form of warfare, the metaphors seem remarkably less apt.

Nonetheless, we are reminded that studying past conflicts can help present-day executives improve their management. In their article (p. 6) Zur Shapira and Joseph Lampel argue that lessons learned from the debacle of Pearl Harbor in 1941 can inform the way managers detect or prepare for sneak attacks. After all, they note, “strategic surprises can occur in business as well.” The best defense for companies – and for nations as well – is not necessarily a massive physical show of strength or the rollout of a conspicuous deterrent threat. Instead, the authors convincingly argue, it lies in using and processing information about threats better and more intelligently.

This article aptly sets the tone for this issue of Sternbusiness, which focuses on the role, importance, and use of information – in all its forms – in complex management challenges. The focus couldn’t be more timely.

For in the current war on terrorism – a remarkably complex global operation – bits and bytes of information are as crucial as horses and crossbows were to combatants in the Middle Ages. Consider the role of money. Today, cold hard cash has essentially been transformed into data – it pulses through global networks in bits of binary code, just as photographs and intelligence analayses do. As seen, this flow can help undermine security. “Just as the terrorists took advantage of our relatively open and porous educational, aviation, and immigration systems to plan and execute their attacks, they also likely took advantage of our financial systems,” write Ingo Walter and Marti Subrahmanyam. (p. 14) They argue that as part of the war on terrorism, governments must use financial intelligence to shut down the secret flows of terrorist-abetting capital.

The events of September 11 have also altered the dynamic between government and the private sector, with industries ranging from hotels to insurance asking for federal help. Nowhere has the interaction been more intense than in the battered airline industry. Larry White offers some intriguing suggestions on how airlines can improve customer relations in this time of crisis and perhaps coax people back to the air (p. 18). The answer lies in the innovative use of frequent flier miles.

In wartime, national resources are the key to a successful effort. Heroic U.S. industrial production in World War II helped set the stage for victory. In this environment, however, information can be a crucial resource – for governments and for businesses. Consider the very term data-mining. It intimates that for companies, information has become as important as coal, gold, or oil.

Tapping into rich veins of data doesn’t lead simply to profits or business advantage, it can also lead to enhanced understanding of recent events. In their article (p. 20), Eli Ofek and Matthew Richardson suggest a comprehensive and compelling argument as to why the .com bubble of the late 1990s formed, and why it burst. Contrary to the prevalent view, which lays the blame squarely at the feet of malignant underwriters, hype-prone analysts and failed .coms, Ofek and Richardson conclude that optimistic investors crowded pessimistic investors out of the stocks, leading prices to rise far above fundamental values. When lock-up agreements expired, a crowd of less optimistic sellers flooded into the market, altering the dynamics of a frenzied market. “Without an influx of optimistic new capital to snap up the new supply, the Internet stocks suffered a decline that quickly turned into a rout,” they conclude.

Just because the .com investing bubble has burst doesn’t mean that information technology’s influence on business is over. Far from it. “Now we’re in E-commerce II, in which established players are using the lessons learned from the first movers to transform their businesses.” said Kenneth Laudon, in an interview that hits on themes from his recently published textbook on e-commerce. (p. 32) Regardless of the vicissitudes of the NASDAQ, Laudon notes, companies will continue to use information technology to redesign their businesses, their markets, and their relationships to consumers.

The fact that information has, in many ways, replaced physical assets as the driver of value, is a theme that Baruch Lev has been developing for years. An expert on the role of intangibles – assets you can see, but can’t necessarily touch, such as patents, brands, and organizational structures – Lev has laid out his theories in a new book, Intangibles: Management, Measurement, and Reporting, which we are proud to excerpt here (p. 26). Lev argues compellingly that the increasing prominence and value of such information-based assets should lead investors, managers, and anlaysts to re-examine the way we account for corporate assets and liabilities.

Of course, even in the information age, old-fashioned commodities are still important cogs of the economy. Cotton is one of the oldest, and most historically important to the United States. Throughout the 1950s and 1960s it lost market share to foreign competition and the relentless growth of synthetic fabrics. But in the 1970s and 1980s, as George David Smith and Timothy Curtis Jacobson show (p. 36), cotton growers managed to turn their fortunes around. How? By relying on up-to-date information-based strategies. A brilliantly conceived and executed marketing and advertising campaign aimed at consumers changed the way people thought about cotton, and research and development helped make the snowy white stuff more appealing to industry. At the dawn of the 21st century, this crucial industry relies as much on favorable weather as it does on the savvy use of information. Staying competitive, the authors note, “requires investment in technology, management, and marketing, and a broad-based knowledge of world affairs, from the weather in Australia to political conditions in Pakistan, from what’s fashionable in Paris to what’s happening in the world’s genetic and biochemical laboratories.”

With the decline of the NASDAQ and a slowdown in the growth of technology spending, many pundits have been quick to proclaim that the much ballyhooed information age was coming to an end. For investors soured on the promise of upstart companies, that may be true. But as the wide array of articles in this issue suggest, for executives and managers in industries ranging from cotton to banking, the information age is just beginning.

Daniel Gross is editor of STERNbusiness.