E-business Environment
ITU
Spring 2013
E-business environment
Figure 2.1
The environment in which e-business services are provided
From supplier- to consumer?
The Value-Chain
E-business environment
Business model
Timmers (1999) defines a ‘business model’ as:
An architecture for product, service and information flows,
including a description of the various business actors and their
roles; and a description of the potential benefits for the
various business actors; and a description of the sources of
revenue.
Figure 2.13
Alternative perspectives on business models
Factors in the macro-environment
affecting e-commerce adoption
•Social factors
•Legal and ethical factors
•Economic factors
•Political factors
•Technological factors
Issues
• First exercise:
• List all the social, legal/ethical, economical, political and
technological issues - that you need to consider in order to
avoid damaging relationships with users, competitors,
suppliers, government - or which may leave the e-business
facing prosecution, or being harmed in other ways.
•Social factors
•Legal and ethical factors
•Economic factors
•Political factors
•Technological factors
•Social factors
• Internet adoption
• Online buyer behaviour
• Online demand for business
services
Factors governing Internet adoption
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Cost of access
Value proposition
Ease of use
Security
Fear of the unknown
Figure 4.1
‘Waves of change’ – different timescales for change in the environment
Variation in broadband subscribers per 100 inhabitants, by technology,
December 2007
Figure 4.2
Source: OECD (www.oecd.org/sti/ict/broadband)
Figure 4.3
Percentage by category who bought offline after researching online
Source: BrandNewWorld: AOL UK / Anne Molen (Cranfield School of Management) /Henley Centre, 2004
Trust in different information sources
• The role of social media and friends in influencing sales was
highlighted by this research from EIAA (2008) which rated key
sources for research indicating the level of trust amongst
European consumers for different online and offline
information sources:
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Search engines (76%)
Personal recommendations (72%)
Trust in different information sources
(Continued)
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Price comparison web sites (61%)
Web sites of well-known brands (59%)
Newspapers/magazines (58%)
Customer web site reviews (58%)
Expert web site reviews (57%)
Retailer web sites (56%)
Sales people in shops (50%)
Content provided by ISPs (38%).
Online buyer behavior
Figure 4.4
Development of experience in Internet usage
Figure 4.5
Variation in purchase rates of online products and services in Europe
Source: European Interactive Advertising Association (www.eiaa.net), Mediascope Eupore 2008
•Social factors
•Legal and ethical factors
•Economic factors
•Political factors
•Technological factors
•Legal and ethical factors
1. Privacy – what information is held
about the individual?
2. Accuracy – is it correct?
3. Property – who owns it and how can
ownership be transferred?
4. Accessibility – who is allowed to access
this information, and under which
conditions?
Table 4.2
Significant laws which control digital marketing
Table 4.2
Significant laws which control digital marketing (Continued)
Ethical issues and data protection
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1.
2.
3.
4.
Ethical issues concerned with personal information ownership
have been usefully summarized by Mason (1986) into four
areas:
Privacy – what information is held about the individual?
Accuracy – is it correct?
Property – who owns it and how can ownership be
transferred?
Accessibility – who is allowed to access this information, and
under which conditions?
Ethics – Fletcher’s view
•
Fletcher (2001) provides an alternative perspective, raising
these issues of concern for both the individual and the
marketer:
1. Transparency – who is collecting what information?
2. Security – how is information protected once collected by a
company?
3. Liability – who is responsible if data is abused?
An example of controversy:
Facebook Terms of Use
By posting User Content to any part of the Site, you automatically grant,
and you represent and warrant that you have the right to grant, to the
Company an irrevocable, perpetual, non-exclusive, transferable, fully
paid, worldwide license (with the right to sublicense) to use, copy, publicly
perform, publicly display, reformat, translate, excerpt (in whole or in part)
and distribute such User Content for any purpose, commercial,
advertising, or otherwise, on or in connection with the Site or the
promotion thereof, to prepare derivative works of, or incorporate into
other works, such User Content, and to grant and authorize sublicenses of
the foregoing.
You may remove your User Content from the Site at any time. If you
choose to remove your User Content, the license granted above will
automatically expire, however you acknowledge that the Company may
retain archived copies of your User Content. Facebook does not assert any
ownership over your User Content; rather, as between us and you, subject
to the rights granted to us in these Terms, you retain full ownership of all
of your User Content and any intellectual property rights or other
proprietary rights associated with your User Content.
http://www.facebook.com/terms.php?ref=pf
The eight principles for data
protection
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Fairly and lawfully processed
processed for limited purposes
adequate, relevant and not excessive
accurate
not kept longer than necessary
processed in accordance with the data subject's rights
secure
not transferred to countries without adequate protection
www.dataprotection.gov.uk
•Social factors
•Legal and ethical factors
•Economic factors
•Political factors
•Technological factors
Economic / political
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Ensuring companies competitiveness
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Achieving government efficiencies
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Funding for education and technology
Promoting new technology for example, broadband 12% in UK,
70% Taiwan, South Korea
E-government – all UK services online by 2005
Singapore ‘Intelligent Island’
Taxation regimes
•
Legislation for offshore trading
Internet Penetration Regions
Region
North America
Penetration
78.6 %
Oceania / Australia
67.6 %
Europe
63.2 %
Latin America/Caribbean
42.9 %
Middle East
40.2 %
Asia
27.5 %
Africa
15.6 %
WORLD TOTAL
34.3 %
http://www.internetworldstats.com
Leaders and laggards in e-commerce
Digital Economy Score
Figure 4.11
A framework describing the e-economy
Source: Booz Allen Hamilton (2002). International E-Economy: Benchmarking The World’s Most Effective Policy for the E-Economy. Report published 19 November, London.
www.e-envoy.gov.uk/oee/oee/nsf/sections/summit_benchmarking/$file/indexpage.htm
•Social factors
•Legal and ethical factors
•Economic factors
•Political factors
•Technological factors
•Political factors
• The political environment
• Internet governance
• E-government policies
The political environment
Government agencies
Public opinion
Consumer
pressure groups
•Social factors
•Legal and ethical factors
•Economic factors
•Political factors
•Technological factors
Technological issues
• Rate of change
•
Which new technologies should we adopt?
• Monitoring for new techniques
• Evaluation – are we early adopters?
• Re-skilling and training
• Are our systems secure?
Figure 4.12
Diffusion–adoption curve
Figure 4.13
Example of a Gartner hype cycle
Source: Gartner (2005) Gartner’s Hype Cycle Special Report for 2005
What action should e-commerce
managers take when confronted by new
technologies?
Figure 4.15
Alternative responses to changes in technology
Environmental drivers and government initiatives
Environment affect the strategy
• So what is strategy…?
My simple take on strategy
Strategy = Desired future – Current status
So strategy is all that happens between the offset
and at the point we decide that we are at the goal
Is it a plan?
A learning curve?