1. Strategies for e-Business
Creating Value through Electronic and Mobile Commerce
Teaching Slides for the Conceptual Part of the Book
Thinking strategically
Thinking technology
Thinking strategically about byproducts of technology
It’s not (only) e-commerce – It’s e-business
Almost all business has some component of e-business now….

2. Strategies for e-business: creating value through electronic and mobile commerce
Table of contents (I)
Key terminology and evolution of e-business
The e-business strategy framework
External analysis: the impact of the Internet on the macro-environment and on the industry structure of e-business companies
Internal analysis: e-business competencies as sources of strengths and weaknesses
Strategy options in e-business markets
Sustaining a competitive advantage over time
Exploiting opportunities of new market spaces in e-business
Creating and capturing value through e-business strategies — the value process framework

3. Strategies for e-business: creating value through electronic and mobile commerce
Table of contents (II)
Choosing the appropriate strategy for the internal organisation of e-business activities
Choosing the appropriate strategy for interaction with suppliers
Choosing the appropriate e-business strategy for interacting with users
Moving from wired e-commerce to mobile e-commerce
A roadmap for e-business strategy implementation
Building e-business competence through concepts and cases
Synopses of case studies

4. Chapter 1: Key terminology and evolution of e-business
After this session you should be able to:
Understand what the terms of ‘e-business’, ‘electronic commerce’ and ‘mobile e-commerce’ mean;
Define the concept of strategy and recognise the different levels of strategy development;
Describe the life cycle of technological revolutions and illustrate it through different examples; and
Recognise the four main periods of the e-business evolution over the past decade and explain the peculiar characteristics of each period.

5. Exhibit 1.1 Electronic business includes electronic commerce and mobile electronic commerce
e-business
Electronic
commerce
Mobile
e-commerce
Source: Adapted from D. Chaffey, 2002, p. 9.

6. Business unit strategy
Exhibit 1.2 The focus of the cases is on corporate level and business unit strategy
Corporate-
level strategy
Corporation
Business unit strategy
Business
unit A
Business
unit B
Business
unit C
Operational strategy
R&D
Production
Etc.

7. Long-term direction of the firm (corporate-level strategy)
Plan development (business-level strategy)
Plan deployment (operational strategy)
To achieve…
Unique positioning vis-à-vis competitors
Achieving sustainable competitive advantage

8. Exhibit 1.3 Technological revolutions move through different stages as their diffusion increases
INSTALLATION PERIOD
DEPLOYMENT PERIOD
Previous great surge 5
Maturity 4
Synergy
(‘golden age')
Crash
Degree of diffusion of the technological revolution 3 2
Frenzy
(‘gilded age')
Irruption
Next great surge 1
Time
Big bang
Next big bang
Source: Adapted from C. Perez, 2002, p. 48.

9. Technological revolution
Exhibit 1.4 Major technological revolutions during the past two centuries show similar patterns of evolution
INSTALLATION PERIOD
DEPLOYMENT PERIOD 1 2 3 4 5
'Crash'
Technological revolution
(core country)
'Irruption'
'Frenzy'
'Synergy'
'Maturity'
The Industrial Revolution
(Britain)
Age of steam and railways
(Britain, then spreading to Continental Europe and the USA
Age of steel, electricity, and heavy engineering
(USA and Germany overtaking Britain)
Age of oil, automobiles and mass-production
(US, then spreading to Europe)
1770s and early 1780s
1830s
1875–1884
1908–1920
late 1780s and early 1790s
1840s
1884–1893
1920–1929
crash in 1797
crash in 1847
crash in 1893
crash in 1929
1798–1812
1850–1857
1895–1907
1943–1959
1813–1829
1857–1873
1908–1918
1960–1974
Source: Adapted from C. Perez, 2002, p. 57.
Timeline

10. Exhibit 1.5 During the past decade, e-business companies have passed through four distinct periods, as is reflected in the evolution of the NASDAQ 1 2 3 4
'Grassroots
of e-business'
'Rise of the Internet'
'Stock market
crash'
'Synergy'
Points
– 45%
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
Year
Launch of Amazon.com
Source: NASDAQ quotes taken from Factiva.com.

11. There are various definitions of strategy
Strategy is:
… the direction and scope of an organization over the long-term, which achieves advantage for the organization through its configuration of resources within a changing environment to the needs of markets and fulfill stakeholder expectations.
Gerry Johnson and Kevan Scholes
… the determination of the basic long-term goals and objectives of an enterprise, and the adoption of courses of action and the allocation of resources necessary for carrying out these goals.
Alfred Chandler
… the deliberate search for a plan of action that will develop a business’s competitive advantage and compound it.
Bruce Henderson
… the strong focus on profitability not just growth, an ability to define a unique value proposition, and a willingness to make tough trade-offs in what not to do.
Michael Porter

12. Stage 1: Pre-internet
Other information and communication technologies such as EDI (Electronic data interchange), IOS (inter-organizational systems)
High-cost of set-up
Proprietary infrastructures
Highly customized to companies
Number of companies using them was low
Not compatible with other infrastructures
“Islands of technology”

13. Stage 2: Rise of the internet
Post 1995
Internet ventures – stock market bubble
Connectivity
Database capabilities
Data mining
CRM, SCM
First mover advantages
Amazon.com

14. Why did the Internet gain prevalence in business?
Among other things…
Open Standards
Cross Platforms
Ease of Use = minimal training of users
Low Cost = reduction in software costs
Ease of installation and maintenance 14

15. Stage 3: the crash March, 2000 Reason: Artificial inflation
Novelty wore off in consumer buying
Excessive subsidies for consumer buy-in
Inflated revenues from stock market
Unrealistic cost estimates

16. Stage 4: synergy Knowledge of industry structure
Knowledge of value creation
Business models
Strategy formulation

17. Throughout this book, we focus on the following key characteristics of strategy
Strategy is concerned with the long-term direction of the firm.
Strategy deals with the overall plan for deploying the resources that a firm possesses.
Strategy entails the willingness to make trade-offs, to choose between different directions and between different ways of deploying resources.
Strategy is about achieving unique positioning vis-à-vis competitors.
The central goal of strategy is to achieve sustainable competitive advantage over rivals and thereby to ensure lasting profitability.
Source: See also G. Johnson and K. Scholes (2002), pp

18. Takeaways…
Strategy and the use of technology go hand-in-hand New/modified strategies needed for e-business