Certainly, leverage, or rather the lack thereof, can go a long way toward explaining the anticlimactic finale of the dot-com insurgency. Consider that while many of the so-called pure plays had long enough levers in the form of millions of dollars in venture capital and private equity, an abundance of entrepreneurial enthusiasm and a favorable climate of endless market hype, what these fledgling upstarts lacked, by and large, was simply a place to stand on.

That could be a physical resource, such as a plant, a piece of equipment or one of the other measured assets that along with cash and cash equivalents typically appear on the plus side of the balance sheet. Or it could be a type of intellectual property -- a patent, process or platform, for example. Lastly, it could take the form of relationship capital, which is the wealth-creating potential of a company's relationships with its key constituents.

Such assets could include employee capital, where the specialized skills, managerial know-how and proprietary knowledge of an employee segment might be used to create new offerings. Or supplier and partner capital, where the unique capabilities of a network of upstream suppliers and downstream channel partners might be enlisted to manufacture and distribute new offerings. Or customer capital, where the proven brand loyalty of a critical mass of customers might be used to market and sell new offerings. Of course, brand loyalty is a competitive advantage that most upstarts of the late 1990s initially took for granted but that, in the end, few were able to replicate in any meaningful fashion.

In contrast to the legions of dot-coms that came up short in their efforts to build relationship capital -- and, for that matter, whose physical assets now sit idly beneath bankruptcy protection -- established companies have generally amassed an abundance of relationship capital. By taking it upon themselves to inventory these assets and break them down into their elemental components, companies might well discover some hidden gems.

The key questions to ask are: Which relationships would every competitor like to own? Which aspects of these relationships are the most valuable and inimitable? Which relationships would provide the best leverage points to boost the profitability of the company's current set of offerings? Which relationships could be deployed in creative ways to launch new, related offerings, propelling the business tangentially into adjacent opportunity arenas? Indeed, which relationships could serve as vectors for growth, springboards that could potentially catapult the company to the next level of valuation? The answer may be: all of them.

Wolfgang Puck's restaurant empire leveraged its customer capital to take a line of gourmet meals to the freezer aisle of the grocery store. A food court's worth of lower-end chains, including Boston Market, California Pizza Kitchen and Taco Bell, have followed suit. Similarly, H&R Block Financial Advisors Inc. leveraged its customer capital to grow beyond tax-preparation services to include mortgage and retirement planning. Caterpillar Inc. leveraged not only its customer capital but also its supplier and partner capital to expand its century-old earthmoving equipment business to include diesel power generators, a category expected to account for a fifth of the company's overall revenue by 2006.

Of course, there's nothing new about a company targeting existing customers with new offerings -- or new customers with existing offers -- in the relentless pursuit of untapped revenue streams, greater profitability and increased market share. What's new is the use of the Internet as a powerful tool for accelerating these positive outcomes.

Indeed, while many marketers have been left jaded by the spectacular failures of their early forays into e-commerce, there's no denying that the Internet can remain a tremendous source of leverage for a company's existing assets. Just as a lever creates a mechanical advantage, allowing you to lift loads far beyond your natural capacity, the Net can enable a company to gain a disproportionate return on its assets.

For example, when coupled with the right incentives, knowledge management systems can be used to leverage employee capital, allowing a company to diffuse knowledge and best practices to the outermost reaches of the organization. Similarly, collaborative design and replenishment systems can be used to leverage supplier capital, ultimately improving quality, reducing inventory in the supply chain and reducing time-to-market for new products.

When it comes to customer capital, think of new opportunities to cross-sell and up-sell other products and services. As a first order of business, this means knowing who the end customers are and being able to market to them with highly targeted promotional offers. For companies selling through reseller channels, the knowing part is generally not easy and may, in fact, not be possible at all. But here, again, the Internet can play an instrumental role by enabling off-line-to-online integrated marketing solutions for capturing that hard-to-get customer information.

Consider Procter & Gamble Co., the nation's largest packaged goods company. How could P&G hope to leverage the customer capital embedded in, say, its Cascade dishwashing detergent in order to cross-sell other products, such as its new Power Tabs rinse aid? After all, the names of the millions of consumers who use Cascade are unknown to P&G. In this case, an answer can be found in Checkout Coupons, a product of Catalina Marketing Corp. Shoppers who receive these coupons as they exit their local grocery stores are invited to visit the Cascade Web site for a chance to enter a monthly sweepstakes drawing. To play, however, they must provide their contact information, including e-mail addresses, and answer a series of questions about their family's dishwashing habits. For many, it's a small price to pay for a shot at winning a year's supply of Power Tabs.

Another example of an off-line-to-online program is one recently launched by DeWalt Industrial Tool Co., a leading manufacturer of power tools and accessories. In this case, DeWalt turned to Seurat Co., a Boston-based consultancy where I serve as a director. DeWalt's objective was to come up with a creative way to capture the e-mail addresses of customers whose records, compiled based on information gleaned over the years from returned manufacturer's warranty cards, were incomplete and outdated. Working with the client, Seurat ultimately settled on a direct-mail campaign using PopOut Window Postcards from WebDecoder, a product of Global Commerce Group. The postcards invite recipients to go to a page on the DeWalt Web site. Holding the viewing window of the postcard up to a blue spot that appears on the screen reveals a prize code. To find out if the code is a winner, however, you first have to enter updated contact information -- again, a minor inconvenience (judging from the campaign's unqualified success), given a chance to win a new circular saw.

By approaching the Internet as a lever and relationship capital as a place to stand on, a company will be better positioned to lift its world to new heights. Indeed, in a universe where companies have a finite amount of resources, and where access to these resources may be further limited by the current economic downturn, leverage simply means finding opportunities that translate into the biggest bang for the buck.

Jeff Zabin is a director at the Boston-based consulting firm Seurat Company and is the co-author of The Seven Steps to Nirvana: Strategic Insights into eBusiness Transformation (McGraw-Hill, 2001).

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