Steps to e-Business
Success
Chou-HongChen, Ph.D.
Professor of MIS
School of Business Administration
Gonzaga University
Spokane, WA 99258, USA
chen@gonzaga.edu
Focus on e-Business Applications
Knowledge Management/Business Intelligence
E-Commerce
Procurement
Network
M:1
Trading
Network
M:N
E-Channel
Management
1:N
E-Portal Management
E-Services
SCM/ERP/Legacy Appls
Businesses &
Consumers
Businesses
E-Customer Relationship
Roles of Information Systems
Automates
Informates
Innovates/
Transforms
3
eBusiness Key Concepts

eBusiness

eCommerce

eCRM (eCustomer Relationship Management)
the strategy of how to automate old business models
with the aid of technology to maximize customer
value
the process of buying and selling over digital media
(e.g., Internet)
the process of building,sustaining, and improving
eBusiness relationships with existing and potential
customers through digital media
4
eBusiness Processes
WHY
Customer Relationship
WHAT
Redesign Business
Processes (Outside-In)
HOW
Applying Technology
5
Why e-Business?


The Information economy will make all
organizations reassess their positions with
respect to their customers-supplier relationship.
“e-Business is bound to come and unless we
are able to cope with the changes in this world,
our competitiveness will decline.”
 this is a clear testament to the power of the
new information-based economy and a
warning to all companies that inertia must
be overcome and change embraced.
By Michiyo Nakamoto, Financial Times, Nov. 23, 1999
6
Revolution, Revolution ...



The e-Business revolution is impossible
to ignore.
It is transforming businesses in virtually
every industry and reshaping the global
economy.
Organizational structures and
operational practices that have served
business well since the Industrial
Revolution are suddenly obsolete.
7
Revolution, Revolution (continued)


The entrenched distribution networks
that once served as formidable barriers
to competition may suddenly become
liabilities, unable to respond to the new
demands of the marketplace.
The e-Business revolution is as
fundamental a change to current
society as the industrial revolution was
to its preceding agrarian society.
8
e-Business ...


The heart of e-business is
interconnectivity and interaction.
The ability to reach more people while
sharing information of increasing
richness creates new opportunities for
value creation in areas such as
marketing, customer service, and
operations.
9
e-Business


(continued)
In this new world, status quo is not an
option. Companies have to reinvent
themselves to survive.
Given the fast pace of e-business
change, actions that once took years to
accomplish must now be done in
months or weeks.
10
Planning is everything ...
develop
Customers,
market,
competition
Vision
guide
Strategy
create
Tactic
Products,
Services
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Vision
Mission
Figure:
Policies
Stages of
e-Business
Goals
(or IS)
Project
Metrics
Values
Time
Horizon
Strategic
Objectives
Planning
Metrics
Values
Time
Horizon
Strategies
Tactics
N
TM -12
IT Planning: The Relationship Between Business, IS,
and IT Strategies
PORTER’S FIVE COMPETITIVE FORCES
MODEL
Threats
NEW
MARKET
ENTRANTS
THE FIRM
SUPPLIERS
SUBSTITUTE
PRODUCTS
& SERVICES
TRADITIONAL
COMPETITORS
Bargaining power
CUSTOMERS
N
Dr. Chen, The Trends of the Information Systems Technology
TM -14
Porter’s Competitive Forces
Strategies
Cost leadership
 Differentiation
 Focus
Expanded generic strategies



Strategic positioning (e.g., internal
efficiency)
Customer service
and my own view ...

Innovation
Dr. Chen, The Trends of the Information Systems Technology
15
STRATEGIC ROLE OF INFORMATION SYSTEMS
STRATEGIC INFORMATION SYSTEM:
CAN CHANGE GOALS, OPERATIONS
PRODUCTS, SERVICES
ENVIRONMENT
TO GAIN COMPETITIVE ADVANTAGE
2.23
Dr. Chen, The Trends of the Information Systems Technology
16
Use of Porter’s Model
•
•
•
•
List players
Analyze business drivers
Devise a strategy
Investigate supportive information
technologies
N
Dr. Chen, The Trends of the Information Systems Technology
17
The Value Chain Model

The model views the firm
as a series or "chain" of
basic activities that add a
margin of value to a firm's
products or services,
indicating where IS can
best be applied to achieve
a competitive advantage.
Dr. Chen, The Trends of the Information Systems Technology
18
N
Activities of Value Chain
Support Activities
Administrative and Other
Indirect Value Added
Inbound
Logistics
Operations
Outbound
Logistics
Marketing
and
Sales
Services
Primary Activities
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The Value Chain
(Value)
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A Transformation Model from Market to Customer
TM -21
Seven-step Process ...

The following seven-step process can
help guide a company through its eBusiness transformation.

Cover the gamut of e-business activities,
from conception to operation
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Seven-step Process







1.
2.
3.
4.
5.
6.
7.
(continued)
Start High
Think Fresh
Know Your Market
Set Vision
Define Strategy
Create
Refresh Regularly
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Seven-step Process

(continued)
1. Start High





e-Business is more than developing a fancy Website
e-Business is a business rather than a technical endeavor
radical change (BPR)
e-Business initiatives may also cut across corporate
boundaries, shifting organizational structures, redefining
job descriptions, and upsetting established processes.
Only corporate executives can marshal the forces and
commitment to launch an e-Business program and
respond the concerns of internal and external
stakeholders.
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Seven-step Process

(continued)
2. Think Fresh


The Internet revolution is radically changing the business
game.
Start with a fresh viewpoint and assume that everything
is open to question and change.





What your customers are really buying from you?
Is how you deliver your product more important than the
product itself?
Porter’s model (commodities vs. differentiation from
competitor, e.g., DELL)
New ways of pricing your products and services.
SWAT, outsourcing
N
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Seven-step Process

(continued)
3. Know your market

assess your company’s current market






needs of your customers, partners, and suppliers
how you can meet or exceed their needs through eBusiness capabilities.
expand upon this market awareness by identifying
possible new products, services, and business lines
encroaching competition from existing and unknown
sources
formulate your e-Business vision and strategy.
Knowing your market means exploring your:

branding, customers, competition, supply chain, demand
chain (e.g., auto online)
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Seven-step Process

(continued)
4. Set Vision


a long-term vision to guide your company as it enters
the e-Business world
the vision defines



do not rush to strategies, actions, and results


what a company wants to do,
what it wants to be.
Vision <--- Mission <--- Goals/objectives <--- Strategies <--Tactics
Complete executive buy-in is essential; executives must
promote the vision and make it part of the corporate
culture - therefore, employees will be imbued with new
corporate vision
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Seven-step Process

(continued)
5. Define Strategy


define, select, and prioritize the initiatives needed to
implement the company’s e-Business vision
the strategy defines


incremental actions are not enough


how the company is going to get there.
expect high potential returns and advantages
other factors to consider:

process change, organizational change, technical
architectures, creative needs, fit within overall vision
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Seven-step Process

(continued)
6. Create



a company transforms itself through a set of coordinated
initiatives that implement that needed organization,
technology, and process changes
the most difficult part of an e-Business transformation is
changing the underlying business model (but does not
mean to undercut the importance of technology nor
underestimate the complexity of the implementation)
when building e-business site, consider:

design, content, promotion, legacy integration,
development (SDLC), organizational change implementation,
training
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Seven-step Process

(continued)
7. Refresh Regularly




to be viable, a company must continually review, reexamine,
and revise its vision, strategies, and implementations.
Speed, innovation, and change are implicit parts of the eBusiness world
survey customers continually to learn if it is meeting their
needs and goals - making money, reaching prospects,
satisfying stakeholders - in order to know when and what
to change
keep company’s Website design and content fresh and
exciting to attract new visitors and to keep them coming
back for more.
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Seven-step Process

(continued)
7. Refresh Regularly (continued)


launch promotional campaigns
 to drive traffic to its Website. Products,
and services;
 to maintain and enhance its brand
identity; and
 to garner a greater share of a market
where switching costs are low or
nonexistent
e-Business promises lower prices and
better selection for consumers, and
unlimited opportunities for new businesses.
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Conclusion


The need for interdisciplinary thinking
has never been greater …
companies that can continually combine




innovative business thinking,
creative design and content, and
advanced technology
will lead the way in e-Business success.
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SURFING THE NET
THANKS and GO for your
Successful e-Business!!
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Vision
Mission,
Principles,
and Values
Goals / Objectives
Strategies
Plans
Tactics
Figure: Hierarchy of Leadership Tools
SURFING THE NET



SEARCH ENGINE: tool for locating
specific sites or information on WWW
HYPERLINK: spot on screen, when
clicked shifts to a new page or site
“PUSH” TECHNOLOGY: server streams
relevant content to browser