eBusiness Concept & Strategy eBusiness-PSI1023 Session 1 Oktalia Juwita, S.Kom., M.MT.

eBusiness >< eCommerce

eBusiness E-Business is about enabling organizations to cohesively bring together their processes and Internet technologies for cost effectiveness, efficiency and better relationships between partners E-Business is the electronic connection of business operations to customers, suppliers, employees and other partners. It includes, but not limited to, product marketing, order entry, inventory tracking, order fulfillment and after-sales support

eCommerce E-Commerce has a narrower definition and only involves buying and selling goods and services over the Internet. It is normally limited to catalogs, order entry, authorization and delivery confirmation.

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EC Organizations brick-and-mortar (old economy) organizations Old-economy organizations (corporations) that perform their primary business off-line, selling physical products by means of physical agents virtual (pure-play) organizations Organizations that conduct their business activities solely online click-and-mortar (click-and-brick) organizations Organizations that conduct some e-commerce activities, usually as an additional marketing channel

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EC Classifications EC IS CLASSIFIED BY THE NATURE AND DIRECTION OF TRANSACTIONS AND INTERACTIONS –business-to-business (B2B) E-commerce model in which all of the participants are businesses or other organizations –business-to-consumer (B2C) E-commerce model in which businesses sell to individual shoppers –e-tailing Online retailing, usually B2C

EC Classifications –business-to-business-to-consumer (B2B2C) E-commerce model in which a business provides some product or service to a client business that maintains its own customers –consumer-to-business (C2B) E-commerce model in which individuals use the Internet to sell products or services to organizations or individuals who seek sellers to bid on products or services they need

EC Classifications –intrabusiness EC E-commerce category that includes all internal organizational activities that involve the exchange of goods, services, or information among various units and individuals in an organization –business-to-employees (B2E) E-commerce model in which an organization delivers services, information, or products to its individual employees

EC Classifications –consumer-to-consumer(C2C) E-commerce model in which consumers sell directly to other consumers –collaborative commerce (c-commerce) E-commerce model in which individuals or groups communicate or collaborate online

EC Classifications –e-learning The online delivery of information for purposes of training or education –e-government E-commerce model in which a government entity buys or provides goods, services, or information from or to businesses or individual citizens

Electronic Commerce Business Models A comprehensive business model is composed of the following elements : –Customers –Products and services –Business process –Resources –Supply chain –Competitors, market share, strengths/weaknesses –Competitive advantage –Organizational changes and any resistance to change –Revenue model

Electronic Commerce Business Models THE STRUCTURE AND PROPERTIES OF BUSINESS MODELS –Revenue Models Sales Transaction fees Subscription fees Advertising fees Affiliate fees Other revenue sources

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eBusiness Strategy

Strategy Definition Base on above definition strategy is.. 1.strategy concerned with long term direction of the firm 2.strategy deals with the overall plan for deploying the resources 3.Strategy entails the willingness to make trade-offs 4.strategy is about achieving unique positioning 5.Strategy is to achieve sustainable competitive advantage

Strategy To establish and maintain a distinctive strategic positioning, a company needs to follow six fundamental principles (Porter, 2001): It must start with the right goal A company’s strategy must enable it to deliver a value proposition, or set of benefits, different from those that competitors offer Strategy needs to be reflected in a distinctive value configuration Robust strategies involved trade-offs Strategy defines how all the elements of what a company does fit together Strategy involves continuity of direction

A systematic approach to e-business strategy formulation

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

Strengths (S)Weaknesses (W) Opportunities (O) Threats (T) INTERNAL FACTORS 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 ST Strategies Generate strategies here that use strengths to avoid threats WT Strategies Generate strategies here that minimize weaknesses and avoid threats Company and Competitive Analysis

Strategic Questions The Company –What is your uniqueness? –Where are you vulnerable? –Why are you losing existing customers? –Where is the greatest value created in the company? –What are the most common objections you hear from customers?

Strategic Questions The competition –Who are the top 3 competitors? –What are their strengths? –Where are they vulnerable? –Where can you attack? –How do you compare on price, service, quality, etc? The market –What are 3 important trends? –How is the industry changing? –How many market segments do you serve? –Where is the greatest growth potential? –Which of your customers are doing well and why?

Continued to session 2 -Thank you-