Title: MIS 648 Presentation Notes: Lecture 8
1MIS 648 Presentation Notes Lecture 8
- Global Aspects of E-Commerce
2AGENDA
- Goal of the Lecture
- Global Aspects of E-Commerce
- Global Economies of Style
- Cultural Influences
3Goals of the Lecture
- Understand E-commerce as a global phenomenon,
with global impact and driving forces - Describe the networked economy as the platform
for global e-commerce - Understand the impact of differential
infrastructure availability on the networked
economy and hence on global e-commerce - Speculate about the future of e-commerce and
properties of marginalization and hollowing out.
4Global Aspects of E-Commerce
- Any business can now transact globally
- This is enabled through the ubiquitous and
non-proprietary idea of a web browser. - HTML (and its successors) have empowered
individuals to access information worldwide
without proprietary networks and software. - Competitive advantage is now in the ability to
capitalize on the capabilities of the ubiquitous
browser.
5Global Aspects of E-Commerce II
- The new economy is the economy enabled by the
Internet and the browser with open standards. - All new economy businesses are global
- Each business can be intermediated and
disintermediated almost at will. - Hence business models must be agile and
businesses must be flexible.
6Global Economies of Style
- Licker, 2005 Presented at the 6th Global
Information Technology Management World
Conference, Anchorage, June. - Major Thesis Global Networked infrastructure
enables value networks and a new way to compete.
- Competing on style means managing a network of
values delivered through relationships.
7Value Networks
- Achieving Economies of Style and Extracting
Profit through Agility in a Value Network - GITMA Anchorage, June 2005
8Agenda
- Supply Chain ? Value Chain
- Value Chain ? Value Network
- Economies of Style
- Moving around the Value Network
- Profit Avoiding commoditization
- Extracting Profit from the Value Network
9The Supply CHAIN
Producer (focal firm)
Supplier
10The Value CHAIN
Gg(S1, S2, Sn) P
VGP
Value is added by distributing the product where
needed or desired
Producer (focal firm
Supplier
Value is added by bringing together supplies
Value is added by creating a product via processes
11The Value NETWORK
Supplier-1
Producer
Supplier-4
Supplier-2
Supplier-3
Buyer-5
Buyer/ Supplier
12Putting the Value in the Value Network
Supplier-1
Producer
Supplier-4
Supplier-2
Supplier-3
Buyer/ Supplier
At any point in this network, value can be added
At any point in this network, value can be added
At any point in this network, value can be added
13Multiple, Volatile Relationships
C
E
A
X
p
D
G
F
B
H
14Relationship Management
ca
C
E
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gf
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da
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VALUE NETWORK V1
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15Economies of Style
- Economy of Scale Reducing variable cost of
production of product. - Economy of Scope Reducing variable cost of
variation in product. - Economy of Style Reducing variable cost of
relationship.
16Avoiding Commoditization
Producer (focal firm
Buyer
Supplier
- Compete on price (economy of scale)
- Compete on design/differentiation (economy of
scope) - Compete on relationship (economy of style)
17Moving Around the Value Network
18Extracting Profit Around the Value Network
Profit comes from finding buyer for reseller
Profit comes from facilitating supplier alliance
Profit comes from locating supplier for producer
Profit comes from turning buyer into low risk
producer
19Extracting Profit through Economies of Style
Third-order
Second-order
First-order
C
X
E
D
A
B
F
G
20General Principle
- Value network integration means firms can play
more roles more quickly - Finding out where value is added and how to
manage that value-adding process is important - The more information content to the physical
product, the more likely it is that agility holds
the key to increased profit
21Cultural Influences
- Globalization is not automatic, however
- Although the browser is ubiquitous, websites may
be tuned locally. - Each culture has its own preferences for style,
layout, language, symbols, pace, emphasis, and
especially content. - There are far too many examples
- These cultural influences might not be fixed.
22Culture Clash and Influences
Presumed World Culture
Business Culture
National Culture
Infrastructure Culture
IT Culture
Specialized Culture
23Major Battleground
- Cultural symbols
- Language (English?)
- Literacy requirements
- Gender taboos
- IT culture symbols, rites, practices
- Consumerism/western culture