EBusiness

1
E-Business Were gonna have a revolution!
Geography and location Are source of value
2
HomeworkSecond Wave Winners

• Whats the initiative?
• Why will it be successful?
• To what extent does it rely on myths versus facts
  of the first wave?

3
e-Business Models

• Describe the way a firm does business
  electronically
• Roles and relationships between consumers, allies
  and suppliers
• Flow of the product, service and information
• Description of the benefits and revenues to
  participants
• Who owns - data, transactions, relationships,
  intellectual property
• Emerging from strategic experiments
• Many different ways to classify
• Atomic e-business models

Stakeholder Value Propositions
IP, Relationships, Assets
Operations
4
Atomic e-Business Models

• Finite number of atomic models
• Describe the essence of the way business will be
  conducted (for both B2B B2C)
• Combined as building blocks to create an
  e-Business initiative
• Have characteristics
• How money is made/Strategic objective
• Critical success factors
• Core competencies
• Information Technology Infrastructure
• Principles that prescribe compatibility
• Some combinations not compatible
• Can decompose an e-Business initiative into
  atomics models to understand characteristics. Use
  business model schematics to analyze

EIGHT ATOMIC e-BUSINESS MODELS Content
Provider Direct to Customer Full Service Provider
Intermediary Shared Infrastructure Value Net
Integrator Virtual Community Whole of Enterprise
/ Government
5
Atomic e-Business Models
Provides content (e.G. information, digital
products services) via intermediaries Provides
goods or services directly to the customer often
bypassing traditional channel players Provides a
full range of services in one domain (e.g.
financial, health) from own products and best of
breed, attempting to own the customer
relationship. Brings together buyers and sellers
by concentrating information (e. G. search agent,
auctions). Brings together multiple competitors
to cooperate by sharing common IT
infrastructure. Coordinates the value net (or
chain) by gathering, synthesizing, and
distributing information Facilitate and create
loyalty to an online community of people with a
common interest enabling interaction and service
provision Provides a firm-wide single point of
contact consolidating all services provided by a
large multi-business organization organized by
customer events
Content Provider Direct to Consumer Full Service
Provider Intermediary Shared Infrastructure Valu
e net Integrator Virtual Community Whole of
Enterprise/ Government
6
Evaluating an e-Business initiative
1.
3.
2.
Customer Segment
Channel
COMBINATION OF e-BUSINESS MODELS
Channel
Customer Segment
Channel
4.
IT INFRASTRUCTURE CAPABILITY
7
Focus on Business Models Why?

• Why do we care about business models?
• How are business models different from corporate
  or business strategies?
• Where do new business models come from?
• What are the pitfalls of business models?
• What is the best measure of the worth of a given
  business model?

8
Xerox Model 914

• Uncertainty economic uses of electrophotography?
  
• Prevailing business models a razor and razor
  blade
• Typical machine sold for 300 vs. Model 914
  manufacturing costs were 2,000
• Model 914 supplier costs were comparable with
  typical machines
• Model 914 offered much higher quality copy and
  faster speed
• Typical machine in used produced 15-20 copies per
  day and 90 used for fewer than 100 copies per
  day
• - How could Model 914 penetrate the market,
  given these economics?

9
eBusiness Model Promise

• Technologies that make little or no business
  sense in a traditional business model may yield
  great value with a different model