Chapter 16 EC Strategy and Implementation

1
Chapter 16EC Strategy and Implementation
2
Learning Objectives

• Describe the importance and essentials of
  business and EC strategies
• Describe the strategy planning process fro EC
• Understand the strategy formulation process
• Understand how EC applications are discovered and
  prioritized

3
Learning Objectives (cont.)

• Describe the role of CSFs and justification of EC
• Describe strategy implementation
• Understand how to reassess EC strategy
• Describe the role of metrics in EC
• Understand EC failures and lessons for success

4
IBMs E-Business Strategy

• Following four goals
• Lead IBMs strategy to transform itself into
  e-business
• Act as a catalyst to help facilitate that
  transformation
• Help business units become more effective in
  their use of the Internet/intranet
• Internally
• With their customers

5
IBMs E-Businesss Strategy (cont.)

• Establish a strategy for the corporate Internet
  site
• Including definition of how it should look,
  feel and be navigated
• Create an online environment most conducive to
  customers doing business with IBM
• Leverage the wealth of e-business
  transformational case studies within IBM to
  highlight the potential of e-business to IBMs
  customers

6
IBMs E-Business Strategy (cont.)

• IBM focused on key initiatives
• E-commerceselling more goods via the Web
• E-care for customersproviding all kinds of
  customer support online
• E-care for business partnersdedicated services
  providing faster, better information for these
  important groups

7
IBMs E-Business Strategy (cont.)

• E-care for employeesimproving the effectiveness
  of IBMers by making the right information and
  services available to them
• E-procurementworking closely with IBM's
  customers and suppliers to improve the tendering
  process and to better administer the huge number
  of transactions involved
• E-marketing communicationsusing the internet to
  better communicate IBMs marketing stance

8
Need for a Strategy

• Cases of e-strategy
• Click-and-mortar companies that use several EC
  applications
• Click-and-mortar companies that use only one or
  two EC applications
• Click-and-mortar companies that use one EC
  application that fundamentally changes all their
  business
• Pure-play EC companies

9
Need for a Strategy (cont.)

• Why does a company need an e-strategy?
• Fast changes in business and technology means
  opportunities and threats can change in a minute
• Company must consider EC strategy that includes
  contingency plans to deal with changes
• May be too costly not to have one

10
Essentials of a Business Strategy

• Strategysearch for revolutionary actions that
  will significantly change the current position of
  a company, shaping its future
• Finding the position in marketplace that best
  fits the firms skills
• Companys choice of new position that must be
  driven by its ability to find new trade-offs and
  leverage a new system of complementary activities
  into sustainable advantage

11
Essentials of a Business Strategy (cont.)

• Types of strategy
• Strategic planning
• Strategic response
• Strategic innovation

• Levels of strategy
• Corporate (or organizational) strategy
• IT strategy
• EC strategy
• EC functional strategies
• These are interrelated

12
Figure 16-1EC Strategy Alignment
13
Essentials of a Business Strategy (cont.)

• Strategy landscape
• Strategy initiation
• Strategy formulation
• Strategy implementation
• Strategy assessment
• Four major steps
• Basis for chapter organization

• Elements of a strategy
• Forecasting
• Resource allocation
• Core competency
• Strategy formulation
• Environmental analysis
• Company analysis

14
Figure 16-2The Landscape of EC Strategy

15
Essentials of a Business Strategy (cont.)

• Information technology (IT) strategystrongly
  correlated with EC strategy because
• IT provides much of the infrastructure for EC
• EC applications must be integrated with IT
  applications
• EC applications may replace or improve existing
  IT applications
• EC organization may report to CIO
• Employees in IS department work on EC applications

16
Strategy Initiation

• First step is to review the organizations
  business and IT vision and mission
• Then, a vision and mission for EC can be
  generated
• Although these statements are usually very vague,
  they provide a springboard for generating more
  specific goals and objectives
• Begin with industry and competitive analysis

17
Industry Analysis

• Analyze position of the company in its industry
  and the competition
• Required for assessing the changes that EC
  project may introduce and its chances for success

18
Industry Assessment

• What industry is the EC initiative related to?
• Who are the customers?
• What are the current practices of selling and
  buying?
• Who are the major competitors? (How intense is
  the competition?)
• What e-strategies are used, by whom?

• How is value added throughout the value chain?
• What are the major opportunities and threats?
• Are there any metrics or best practices in place?
• What are the existing and potential partnerships
  for EC?

19
Figure 16-3Company Analysis
Source Hackbarth and Kettinger (2000), p. 85.
Reprinted with permission of William J. Kettinger.
20
Industry and Competitive Analysis

• Monitoring, evaluating, disseminating of
  information from the external and internal
  environments
• SWOT Analysis
• Strengths
• Opportunities
• Weaknesses
• Threats

SWOT
21
Figure 16-4 SWOT Diagram
INTERNAL FACTORS
Strengths (S)
Weaknesses (W)
EXTERNAL FACTORS
SO Strategies Generate strategies here that use
strengths to take advantages of opportunities
WO Strategies Generate strategies here that take
advantage of opportunities by overcoming
weaknesses
Opportunities (O)
ST Strategies Generate strategies here that use
strengths to avoid threats
WT Strategies Generate strategies here that
minimize weaknesses and avoid threats
Threats (T)
22
Competitive Intelligence on the Internet

• Internet can play a major role as a source of
  competitive information (competitive
  intelligence)
• Review competitors Web sites
• Analyze related newsgroups
• Examine publicly available financial documents
• Ask the customersaward prizes to those who best
  describe your competitors strengths and
  weaknesses

23
Competitive Intelligenceon the Internet (cont.)

• Information delivery services
• Find out what it published on the Internet
• Newsgroups
• Information about your competitors and their
  products
• Known as push technologies
• Corporate research companies provide information
  about your competitors
• Risk analysis
• Stock market analysts reports
• Examine chat rooms

24
Competitive Intelligenceon the Internet (cont.)

• Evolving experiences, need to be treated with
  care
• Overreliance on such information can be dangerous
• Using publicly available search engines is free,
  but may produce lots of irrelevant information
• Use specialty-build agents to search the
  overwhelming amount of information available

25
Customized Competitive Intelligence

• Current company information is available in their
  press releases and information published on their
  Web sites
• Push technology services used to keep companies
  up-to-date by finding information for them
• Searches should not replace in-depth background
  research
• Business intelligence companies offer packaged
  competitive analysis

26
Issues in Strategy Initiation

• To be a first mover or a follower?

• Disadvantages
• Cost of developing EC initiative is usually very
  high
• Chance of failure is high
• System may be obsolete as compared to second wave
  arrivals
• No support services are available at the
  beginning

• Advantages
• Chance to capture large markets
• Establishing a brand name
• Exclusive strategic alliances

27
What Do You Need an EC For?

• Enhancing the sell channel by advertisement and
  sales
• Enhancing the buy (procurement channel)
• Enhancing the customer service channel
• Going global

• Facilitating value-chain integration
• Providing for new products and services
• Going into specialty markets
• Going to mass customization

28
Should You Have a SeparateOnline Company or Not?

• Advantages
• Reducing or eliminating internal conflicts
• Providing more freedom to management in pricing,
  advertising, etc.
• Can create new brands quickly
• Take the e-business to an IPO and make a fortune

• Disadvantages
• May be very costly and risky
• Collaboration with off-line business may be
  difficult
• Lose expertise of business functions unless you
  use close collaboration

29
Strategy Formulation

• Strategy formulation
• Development of long-range plans
• Organizations mission
• Purpose or reason for the organizations
  existence
• 3 main reasons for establishing Web site
• MARKETING, CUSTOMER SUPPORT, and SALES
• Products with good fit for EC
• Shipped easily or transmitted electronically
• Targets knowledgeable buyers
• Price falls within certain optimum ranges

30
EC Critical Success Factors

• Special products or services traded
• Top management support
• Project team representing various functional
  areas
• Appropriate technical infrastructure
• Must have customer acceptance
• User-friendly Web interface
• Integration with the corporate legacy systems

31
EC Critical Success Factors (cont.)

• Security and control of the EC system
• Competition and market situation
• Conduct pilot project and capture corporate
  knowledge
• Use promotion and internal communication
• Cost of the EC project must be reasonable
• Need sufficient level of trust between buyers and
  sellers

32
EC Opportunities

• 3 common mistakes in allocating EC investment
• Let a thousand flowers bloomfund many projects
  indiscriminately
• Bet it allput everything on a single high-stake
  initiative
• Trend-surffollow the crowd toward the next big
  thing
• All of the above can be risky and costly

33
EC Opportunities (cont.)
Approaches to finding individual EC initiatives

• Problem-drivenattempt to solve a problem such
  as
• Excess inventory
• Delivery delays
• Technology-driventrying to use existing
  applications
• Find problems no one knew existed
• Used by first movers

34
EC Opportunities (cont.)
Approaches to finding individual EC initiatives
(cont.)

• All can fail
• Market-drivenwaiting to see what the competitors
  will do
• Fear or greed-driven
• Afraid if they do not practice EC they will be
  big losers
• Think they can make lots of money going into EC

35
Figure 16-5Approaches for Finding EC
Opportunities
36
Uncovering Specific ECOpportunities and
Applications

• Understand
• How digital markets operate
• How Internet customers behave
• How competition is created and what
  infrastructure
• is needed
• What the dynamics of EC are
• Map opportunities that match current competencies
  and markets
• Many opportunities to create new products and
  services

37
Uncovering Specific ECOpportunities and
Applications (cont.)

• Opportunities for EC businesses
• Matchmakingmatching buyers needs from seller
  without a prior knowledge of either one
• Aggregation of servicescombines several existing
  services to create a new service
• Bid/ask enginecreates a demand/supply floating
  pricing system
• Notification servicetells you when the service
  becomes available, or when it becomes cheaper

38
Uncovering Specific ECOpportunities and
Applications (cont.)

• Smart needs adviserif you want , then you
  should
• Negotiationprice, quantity, or features are
  negotiated
• Up-sellsuggests an additional product or service
• Consultative adviserprovide tips on using the
  product

39
Methods for Finding IT Applications

• Brainstorming by a group of employees
• Soliciting the help of experts, such as
  consultants
• Review what the competitors are doing
• Ask the vendors to provide you with suggestions

• Read the literature to find out whats going on
• Use analogies from similar industries or business
  processes
• Use a conventional IS requirement analysis
  approach

40
Determining an AppropriateEC Application
Portfolio
Generic approaches

• Find the most appropriate portfolio in order to
  share limited resources
• Combine long-term speculative investments in new
  potentially high-growth business
• With short-term investments in existing,
  profit-making businesses
• Boston Consulting Groups matrix
• Cash cows Questionable projects
• Starts Dogs

41
EC Application Portfolio

• An EC-specific method

• Tjans portfolio strategyInternet portfolio map
• Strategy based on company fit (assessed by five
  levels from high to low)
• Projects viabilityassessed by 4 criteria
• Market value potential
• Time to positive cash flow
• Personal requirements
• Funding requirements

42
Which Business Model to Use?

• Case Schubb Corp.property and casualty
  insurance company

• Typical choice of EC model at Schubb Corp.
• Create a new business model with EC as a major
  driverdiscarded because they had a successful
  business model with products matching
  distribution systems
• Spawn a secondary business model around EC go
  directly to consumersdid not want to interrupt
  their relationships with agents and brokers

43
Case Schubb Corp. (cont.)

• Use EC as a tool within the existing business
  model (the selected model)
• Helped Schubb further differentiate products and
  services by providing superb customer service
  over the Internet
• Opened several Web sitesone for each specialty
  group (e.g., for wine collectors)
• Enables superb communication with agents and
  business partners
• Allows business expansion into 20 countries

44
Cost-Benefit and Risk Analysis

• Business case for EC approach for garnering
  funding for projects used to
• Provide justification for investments
• Provides bridge between EC plan and the execution
• Provides foundation for tactical decision making
  and technology risk management
• Clarifies how the organization will use resources
  to accomplish the e-strategy

45
Cost-Benefit and Risk Analysis (cont.)

• Content of an E-business case
• Strategic justificationwhere are we going?
• Generational justificationhow will we get
  there?
• Technical justificationwhen will we get there?
• Financial justificationwhy will we win?

46
Cost-Benefit and Risk Analysis (cont.)

• How to conduct an
• e-business case
• Develop goal statement
• Set measurable goals
• Develop short- and long-term action plans
• Gain approval and support

• Revenue model
• Properly planned revenue model is a critical
  success factor
• Revenues from sales depend on customer
  acquisition cost and advertisement
• Must be figured into the analysis

47
Cost-Benefit and Risk Analysis (cont.)

• It is difficult to justify EC investment due to
  many intangible variables
• Methods used for analysis
• Value analysis and proposition
• Rate of return of investment (ROI) and/or
  discounted cash flow
• Real options valuation and analysis
• Management by maxim
• Information economics

48
Value Analysis and Proposition

• A Value Analysis Approach
• Value chaina series of activities a company
  performs to achieve its goal(s)
• Value added
• Contributes to profit and enhances the asset
  value as well as the competitive position of the
  company in the market
• To create additional value using EC channels, a
  company should consider the competitive market
  and rivalry in order to best leverage its EC
  assets
• (Customers value proposition)

49
Value Analysis and Proposition (cont.)

• Value Analysis Questions
• Representative Questions for Clarifying Value
  Chain Statements
• Can I realize significant margins by
  consolidating parts of the value chain to my
  customers?
• Can I create significant value for customers by
  reducing the number of entities they have to deal
  with in the value chain?

50
Value Analysis and Proposition (cont.)

• Value Analysis Questions (cont.)
• Representative question for creating new values
• Can I offer additional information of transaction
  services to my existing customer base?
• Can I use my ability to attract customers to
  generate new sources of revenue, such as
  advertising or sales of complementary products?

51
Return on Investment (ROI)

• Return on Investment and Risk Analysis

• A ratio of resources required and benefits
  generated by an EC project
• Includes both quantifiable items (cost of
  resources, computed monetary savings) and
• Non-quantifiable items (intangibles)
• Some intangible benefits
• Effective marketing channel
• Increased sales
• Improved customer service

52
Return on Investment and Risk Analysis

• IT values
• Financial valuesmeasurable to some degree
• Strategic valuescompetitive advantage in the
  market and benefits generated by business
  procedures
• Stakeholder valuesreflections of organizational
  redesign, organizational learning, empowerment,
  information technology architecture of a company,
  etc.

53
Return on Investment and Risk Analysis (cont.)

• IT risks risks
• Competitive strategy riskexternal, due to joint
  venture, alliances or demographic changes among
  others
• Organizational risk and uncertaintyinternal to
  company

54
Figure 16-7Real Option Analysis
Source Rayport and Jaworski (2001) Exhibit 8-8
pg. 304.
55
Risk Analysis

• Risk analysis program should
• Identify all potential risks
• Assess potential damage
• Evaluate possibility of protection (insurance)
• Evaluate cost of protection vs. benefits

• E-business risks
• Strategic risks (e.g., competitive environment,
  wrong strategic direction)
• Financial risks (e.g., currency management and
  changes, unclear tax situations)
• Operational risks (e.g., technological changes
  and use of poor technology, security)

56
EC Scenarios

• Scenario planning is a methodology used in
  planning situations that involve much
  uncertainty, like that of EC (what-if)
• Several different scenarios are created
• A team compiles several future events as possible
  influences on the outcome
• Securities are assessed and future projections
  are made
• Scenarios are compared

57
EC Scenarios (cont.)

• Four scenarios described by Hutchinson
• Open, global commerce scenarioremoval of
  intermediaries flattens the value chain
• Members-only subnet scenarioapplies mostly to
  B2B EC
• Electronic middlemen scenariobusiness and
  consumer market suppliers can make
  products/services available through independent
  third-party distribution channels

58
EC Scenarios (cont.)

• 4 scenarios described by Hutchinson (cont.)
• Consumer marketing channels scenariotraditional
  methods collapse into a unified consumer-centric
  EC medium on the Internet
• Broadcasting
• Advertising
• Consumer telephony

59
Strategic Planning Framework

• EC appears in three levels
• Level 1 Basic presencecompany uses the Internet
  to feature company information and provide
  brochures
• Level 2 Prospectingfeatures added
• Search engine
• Extensive product information
• Links to services
• Ability to interact with the company
• Basic customer service

60
Strategic Planning Framework (cont.)

• Level 3 Business integrationmore features added
• EC transaction capabilities
• Customization and personalization services
• Tools fostering creation of a community
• Level 4 Business transformationsupplier and
  customer integration added
• Multichannel integration
• Advanced customization and configuration
• Superb customer service

61
Strategic Planning Framework (cont.)

• Generic competitive strategy vs. cooperarative
  strategy
• Competitive strategy assumes fighting against all
  competitors for the purpose of survival and
  winning
• Cooperarative strategy plans for working together
  with specific competitors to gain advantage
  against other competitors

62
Generic Competitive Strategies

• Defensive strategies takes place in the firms
  own current market position as a defense against
  possible attack by a rival
• Raise structural barriers
• Lower the inducement for attack

• Offensive strategy usually takes place in an
  established competitors market
• Frontal Assault attacker must have superior
  resources and willingness to persevere
• Flanking Maneuver attack a part of the market
  where the competitor is weak

63
Generic Cooperative Strategies

• Collusion
• Active cooperation of firms within an industry
  to reduce output and increase prices in order to
  get around the normal economic law of supply and
  demand (illegal)
• Strategic Alliance
• Partnership of two or more corporations or
  business units to achieve strategically
  significant objectives that are mutually
  beneficial

64
Generic Cooperative Strategies (cont.)

• Joint Venture
• A way to temporarily combine the different
  strengths of partners to achieve an outcome of
  value to both
• Value-Chain Partnership
• A strong and close alliance in which one company
  or unit forms a long-term arrangement with a key
  supplier or distributor for mutual advantage

65
Svioklas Strategy

• What is the right organizational structure?
• Existing company structures designed to sustain
  existing marketplace model
• Companies usually need to realign their
  structures to
• Break functional silos
• Meet different business needs

• What is the companys digital business strategy?
• What is the right value proposition for a new
  business model?
• EC ventures dont fit neatly into established
  business categories
• Traditional strategies probably wont fly either

66
Svioklas Strategy (cont.)

• What is the correct technology platform?
• Companies succeed online only with IT designed
  for a digital economy
• EC technology must integrate seamlessly with
• Customer call center
• Billing
• Shipping systems

• What is the best capital structure?
• Capital markets tend to reward innovative capital
  structures
• They are buying the future, not the past
• Very risky due to overvaluation

67
Mougayars Approach

• What questions should a strategic plan answer?
• How is Electronic Commerce going to change our
  business?
• How do we uncover new types of business
  opportunities?
• How can we take advantage of new electronic
  linkages with customers and trading partners?

68
Mougayars Approach (cont.)

• Will intermediaries be eliminated in the process?
  Or do we become intermediaries ourselves?
• How do we bring more buyers together
  electronically (and keep them there)?
• How do we change the nature of our products and
  services?
• Why is the Internet affecting other companies
  more than ours?
• How do we manage and measure the evolution of our
  strategy?

69
Wares Approach

• Ware et al.s seven-step model e-strategy asks
  the following basic questions
• Where are you along the continuum of possible EC
  applications?
• Where do you want to go?
• How are you going to get there?

70
Wares Approach (cont.)

• Seven-step model e-strategy
• Step 1 create a map of scenarios for aligning
  business strategy and Internet initiatives in the
  future
• Step 2 communicate a vision from top management
  to drive Internet initiatives
• Step 3 identify and transform key value
  constellations (specifically core practices and
  processes)

71
Wares Approach (cont.)

• Seven-step model e-strategy (cont.)
• Step 4 develop portfolio of EC initiatives the
  company wants to pursue
• Step 5 develop year-by-year objectives and plans
  for chosen initiatives
• Step 6 implement the change
• Step 7 monitor the overall plan, learn lessons,
  adjust, improve

72
Strategic E-Breakout Methodology

• Kettinger and Hackbarth Methodology

• Diagnosis stage
• Gathers information about strengths, weaknesses,
  opportunities, and threats
• Asses company and industry processes
• Benchmarks e-business technologies

• Initiation stage
• Envisions potential strategic change
• Confirms top management support
• Determines project schedule

73
Kettinger and Hackbarth Methodology

• E-breakout stage
• Formulates an
• e-business strategy with objective of breaking
  out of the box
• Using e-business technology to transform
  processes and people
• To better compete in dynamic global marketplace

• Transition stage
• Recognizes reality that e-breakout may not be
  immediately obtainable because of a companys
  unwillingness to change
• Serves as a gap strategy that allows incremental
  steps to the e-breakout strategy

74
Issues in Strategy Formulation

• EC strategies in small businesses
• Senior managers tend to
• Know the whole spectrum of business
• Possess knowledge and authority to lead EC venture

75
Issues in Strategy Formulation (cont.)

• How to handle channel conflicts
• Let established old-economy-type dealers handle
  e-business fulfillment
• Sell some products only online
• Help your intermediaries (e.g., build portals)
• Sell online and off-line
• Do not sell online

76
Issues in Strategy Formulation (cont.)

• How to handle conflict between off-line and
  online businesses in a click-and-mortar situation
• Clear support of top management
• Use of innovative processes that support
  collaboration
• Clear strategy of what and how

77
Issues in Strategy Formulation (cont.)

• Pricing strategy
• Setting prices lower than off-line business may
  lead to internal conflict
• Setting prices at the same level may hurt
  competitiveness

78
Issues in Strategy Formulation (cont.)

• Where to compete
• Current position
• Backward or forward in the supply chain
• Move horizontally to new businesses
• Play different roles
• Infomediary
• Community creator
• Content provider
• Portal builder
• Aggregator

79
Issues in Strategy Formulation (cont.)

• Should you get financing from big venture capital
  firms?
• VC financing causes loss of control over business
• Benefit access to various VC experts and get the
  cash you need

• Should you join an exchange?
• Several benefits
• Many costs and limitations
• Decide earlyexchange may provide sell-side or
  buy-side infrastructure
• Which exchange to join?

80
Implementation EC Plan

• Starts with organizing a project team
• Undertake a pilot project (help discover problems
  early)
• Implementing EC
• Redesigning existing business processes
• Back-end processes must be automated as much as
  possible
• Company must set up workflow applications by
  integrating EC into existing accounting and
  financial back-ends

81
Evaluating Outsourcing

• Factors to consider
• Ease of configuration and setup
• Database and scripting support
• Payment mechanism
• Sample storefronts
• Workflow management
• Documented database support
• Integration into existing accounting and
  financial back ends
• Which services to outsource

82
Issues in Strategy Implementation

• Partners strategy
• Many potential partners, may need several
• Companies that make B2B e-marketplaces consider
• Logistics
• Technology
• E-payment partners
• How to coordinate B2B and B2C
• Selling direct is creating a B2C business
• Coordination between the two can be done in
  different ways

83
Strategy and Project Assessment

• Need for assessment
• Find out if EC project delivers what it was
  supposed to deliver
• Adjust plans if necessary
• Determine if EC project is still viable
• Reassess initial strategy in order to learn from
  mistakes and improve future planning
• Identify failing projects as soon as possible and
  determine reasons for failure

84
Strategy and Project Assessment (cont.)

• Measuring results watch for
• Goals may be unrealistic
• Web server was inadequate to handle demand
• Expected cost savings were now realized
• Exploding application requests from various
  functional areas in the company may follow
• Review requirements and design documents
• Develop thorough checklist
• Pose a set of questions to assess impact of EC
  project

85
Strategy and Project Assessment (cont.)

• Finalization and adjustments
• Actual ROI can be computed and compared to the
  projected one
• If sales expectations were not met, review
  marketing efforts
• Web assessment based on collected information
• Corrective steps might be required
• Product offerings to pricing strategy
• Web promotion to review software vendors

86
EC Metrics

• Metrics include benchmarks in different areas
  related to EC implementation and strategy
• Define and refine business models
• Communicate strategy
• Track performance
• Increase accountability
• Align objectives of individuals, departments, and
  organizations

87
EC Metrics (cont.)

• Balanced scorecardmanagers focus on short-term
  financial results and
• Financeincluding both short- and long-term
  measures
• Customershow the customers view companies
• Internal business processfinding areas in which
  to excel
• Learning and growthsustainability to change and
  expand

88
EC Metrics (cont.)

• Scorecard approach to ECseven sets of metrics
• Financial
• Competitive leadership
• Marketing
• Technology
• Service
• Internet site
• Brand

89
EC Metrics (cont.)

• Performance dashcard
• Divided into 5 desired outcomes and 5
  corresponding metrics
• Metrics are mapped with leading and lagging
  indicators of performance, leading to calculated
  targets
• Strategies are then evaluated and reformulated

90
EC Failures and Lessons Learned

• E-Tailing failures
• Lack of funding
• Incorrect revenue model
• Exchange failures
• Revenue growth too slow
• Need to move to new business model
• EC initiative failures
• Other failures

91
Table 16-3Critical Success Factors for EC
92
12 Truths About How the Internet Really Works

• Internet not as disruptive to business as we
  thought
• If it doesnt make cents, it doesnt make sense
• Time favors incumbents
• Making a market is harder than it looks
• There is no such thing as Internet time
• Branding is not a strategy

93
12 Truths About How the Internet Really Works
(cont.)

• Entrepreneurship cannot be systematized
• Investors are not your customers
• Internet still changes everything
• Internet changes your job
• Distinction between Internet companies and
  non-Internet companies is fading fast
• Real wealth creation is yet to come

94
Managerial Issues

• Considering the strategic value of EC
• Considering the benefits and risks
• Integration is critical
• Metrics are beneficial
• Pilot projects are useful
• Implementing policies and strategies must be
  written