Steps to e-Business Success

1. 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

2. Focus on e-Business Applications Knowledge Management/Business Intelligence E-Commerce E-Customer Relationship Procurement Network Trading Network E-Channel Management Businesses & Consumers Businesses M:1 M:N 1:N E-Portal Management E-Services SCM/ERP/Legacy Appls

3. Roles of Information Systems Automates Informates Innovates/ Transforms

4. eBusiness Key Concepts • eBusinessthe strategy of how to automate old business models with the aid of technology to maximize customer value • eCommercethe process of buying and selling over digital media (e.g., Internet) • eCRM (eCustomer Relationship Management)the process of building,sustaining, and improving eBusiness relationships with existing and potential customers through digital media

5. WHAT HOW eBusiness Processes WHY Customer Relationship Redesign Business Processes (Outside-In) Applying Technology

6. 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

7. 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.

8. 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.

9. 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.

10. 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.

11. develop guide Strategy create Tactic Planning is everything ... Vision Customers, market, competition Products, Services

12. Vision Goals Objectives Mission Policies Time Horizon Time Horizon Metrics Values Metrics Values Strategies Tactics Figure: Stages of e-Business (or IS) Project Strategic Planning N TM -12

13. IT Planning: The Relationship Between Business, IS, and IT Strategies

14. NEW MARKET ENTRANTS SUBSTITUTE PRODUCTS & SERVICES TRADITIONAL COMPETITORS THEFIRM SUPPLIERS CUSTOMERS PORTER’S FIVE COMPETITIVE FORCES MODEL Threats Bargaining power N TM -14 Dr. Chen,The Trends of the Information Systems Technology

15. 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

16. 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

17. 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

18. 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. N Dr. Chen,The Trends of the Information Systems Technology

19. Operations Outbound Logistics Marketing and Sales Services Activities of Value Chain Support Activities Administrative and Other Indirect Value Added Inbound Logistics Primary Activities

20. Competitive (Value) Advantage The Value Chain

21. A Transformation Model from Market to Customer TM -21

22. Seven-step Process ... • The following seven-step process can help guide a company through its e-Business transformation. • Cover the gamut of e-business activities, from conception to operation

23. Seven-step Process (continued) • 1. Start High • 2. Think Fresh • 3. Know Your Market • 4. Set Vision • 5. Define Strategy • 6. Create • 7. Refresh Regularly

24. 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.

25. 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

26. 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 e-Business 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)

27. 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 • what a company wants to do, • what it wants to be. • do not rush to strategies, actions, and results • 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

28. 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 • how the company is going to get there. • incremental actions are not enough • expect high potential returns and advantages • other factors to consider: • process change, organizational change, technical architectures, creative needs, fit within overall vision

29. 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

30. 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 e-Business 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.

31. 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.

32. 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.

33. SURFING THE NET Surf's Up!

34. THANKS and GO for your Successful e-Business!!

35. Vision Mission, Principles, and Values Goals / Objectives Strategies Plans Tactics Figure: Hierarchy of Leadership Tools

36. 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 Surf's Up!