Business strategies and the Internet different debates and viewpoints

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Strategic Implementation of E-Commerce

• Business strategies and the Internet different
  debates and viewpoints
• Formulating strategies contribution by
  different scholars
• The tools for analysing the strategic potential
  of EC
• Preparing for EC
• Implementing EC the steps to follow
• Managing change

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Business strategies and the Internet

• The debates and viewpoints
• Michael Porter - operational effectiveness and
  strategic planning
• Mintzberg -plan, ploy, pattern, position and
  perspective
• Gary Hamel - business concept innovation
• Szulanski et al - strategy making as an art
• Eisenhardt et al - strategy as simple rules

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Formulating strategies - contribution by
different scholars

• Boisots approach
• Use data to turn strategies into plans
• Allow those at operational level to take action
• Tackle challenge at local level
• Use collective initiative to create a mission to
  reflect long-term strategy.

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• Porter recommended
• Create unique activities
• Make choices between what to do and what not to
• Create activities that interlock (fit)
• Reconnect with strategy by finding distinct and
  profitable products, and

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Hamels Business Concept Innovation

• Core strategy - the way the firm uses to compete
• Strategic resources - how it utilises its
  resources
• Customer interface - how it interacts with
  customers
• Value network - its coalition with partners and
  competitors.

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Building bridges between business components

• Through BCI, a company achieves
• improved customer benefit
• a configuration that can support its mission
• a clear boundary between what can be done
  internally and what should be outsourced.

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Some other views

• Dyer et al
• the co-existence of competition and collaboration
  (sometimes referred to as co-opetition)

• Ghosh
• pirate an industrys value-chain and become a
  powerful new force
• becoming a customer magnet through a process of
  taking small steps

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CGEY report - a study of financial institutions

• Businesses need to take risks to create new
  products, and market and sell them
• They must provide an infrastructure by becoming
  one of the following
• commodity provider
• infrastructure provider
• market maker
• superior performer
• innovator
• or a relationship manager.

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Baker Hoque

• In the international arena one of three
  approaches can be used
• Predict and prepare - the cautious route
• Use power to limit damage
• Build internal capacity by broadening scope

• To build an e-enterprise
• create a vision by bringing the firms physical-
  and virtual- strengths together,
• then build business and technology architectures
  based on that vision
• review, refine and recycle continually.

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Strategy development for knowledge management

• Different approaches
• Democratisation vs. centralisation of information
• Technology-based vs. human-based knowledge
  management.

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Steps of strategy formulation
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Tools for analysing strategic potential

• SWOT analysis
• Value chain
• Critical success factors
• Return of investment.

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SWOT analysis

• The internal component - attempts to assess a
  firms competencies, readiness and strength to
  face the new market, legislative issues and
  customer needs.
• The external element - assesses the position of
  the competitors, market trends and scope for
  extension, risk of substitute products and the
  possibility of new relationships with customers.

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Value chain

• Value-chain analysis assesses
• how e-commerce can influence the value added at
  each stage of the chain and
• how the company can improve it by taking over
  some of the tasks
• by asking a number of questions.

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Critical Success Factors

• CSFs are the critical aspects of business
  processes, technology and management skill. They
  can operate at many levels
• industry-wide
• organisation-wide
• within a business unit and
• at management level.

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Examples of typical CSFs

• The commitment of the top management levels
• The relationship with customers
• The quality of the website
• The competition in the market
• The integration of corporate backend information
  systems with e-commerce applications
• The communications infrastructure
• The security controls

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Return On Investment

• ROI is the cost benefit ratio which can be
  measured by
• using the balanced scorecard method to ascertain
  growth in revenue
• customer retention and acquisition rate
• the quality of internal activities
• cultural aspects such as the growth in learning
  of employees.

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Preparing for E-Commerce

• The simple rules model
• How to rules
• Boundary rules
• Priority rules
• Timing rules
• Exit rules

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Need for policies

• A firm should have policies on how to deal with
• Technology infrastructure
• Security and privacy
• Unforeseen problems
• Human resources problems
• The assessment of its effectiveness.

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Implementation of E-Commerce

• An inter-enterprise e-commerce architecture
  comprises
• backend IT and business processes
• customer-facing systems and
• the value-chain relating to these.
• It needs technology and people to complete the
  picture
• it responds to the ecosystem of other businesses.

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Infrastructure building

• An effective infrastructure includes
• An all-encompassing service for customers
• An integrated value-chain
• Integrated back-end information systems and
  business processes
• An infrastructure to support widespread
  communication
• An effective human support system for employees.

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Developing E-Commerce initiatives

• In-house development requires time and expertise
  but produces tailor-made systems
• Outsourcing has many advantages but can cause
  conflicts of control
• Component-based development using object-oriented
  software tools can be used to build standardised
  systems without the need for exceptional
  technical skills.

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Approaches to systems development

• Traditional approach
• hard and formal
• did not allow much user involvement or fuzzy
  specifications.
• Contemporary approach
• soft systems methodologies

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Stepwise refinement

• Iterative design and implementation advocated by
  the soft systems methodology
• Initially, only a limited number of applications
• Improvements and additions made in stages based
  on user feedback

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Managing change

• Two approaches
• E (for economic value) which uses hard measures
• O (for organisational capability) based on
  developing human capability to accept change.
• The sequencing of the two approaches is
  recommended.

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Questions

• What are the debates surrounding strategies and
  strategy formulation?
• How do they relate to real-life business
  functions?

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Case studies

• Edmunds.com
• Charles Schwab
• Lloyds TSB
• Autodesk
• NSPCC