TODAY Room 216; 6:15-7:45 GUEST SPEAKER DON HAZELL BEA Systems Topic: “Practitioners Perspective on Implementing e-Business Solutions”

University of Colorado at Boulder Bolsa de Valores de Guayaquil:Reaching worldwide investors through the Internet Ramiro Montealegre University of Colorado at Boulder

Europe generates more than 20% The rest accounts for less than 5%.” “More than 75% of all EC takes place in U.S. Europe generates more than 20% The rest accounts for less than 5%.” Inter-American Development Bank, July 1999

Ecuador’s National Context Factors (1995-1998) Date Context Factors Jan 95 Armed conflict with Peru Aug 95 Electric power rationing program Sep 95 Vice-President charged of misusing “discretionary funds” Jan 96 Abdala Bucaram elected president Economic program: taxes on gas, electricity, and gasoline Feb 96 General strike. Congress voted to depose Bucaram Vice-President assumed power with army support, but Congress appointed Dr. Fabian Alarcón Nov 97 El Niño damage infrastructure and intimidate investors. May 98 Estimated cost of rebuilding roads: $800 million. Farmers lost $1 billion in output. Jun 98 Inflation was 35.9%. Political system: 14 parties held seats in Congress;

RESEARCH SITE High Complexity Low Rate of Change Low Accessibility to Resources - Low Environment Stability Ecuadorian Context BVG Context But the requirements - Few people (53 people) - Modest IT facilities - Small budget - Do it fast - Innovatively - With world-class quality

INTERNET STRAGY’S RESULTS Mundo Virtual was launched October 1, 1997, as planned. Income from paid-in-advance contracts: $72,600 in 1997. On December 18, 1998, the Ecuadorian Congress and the Chamber of Production, recognized BVG for “promoting development of the national securities market and our country in the international market in order to foster foreign investment.”

Research Question HOW BVG formulated and implemented its Internet-based strategy? WHY it succeeded (despite the poor fit with the environment)?

Phase 1. Establishing Direction Benchmarking. Evaluating practices at other stock exchanges Training. Seminar at an Ecuadorian Business School Forming shadow org. A committee of BVG directors assigned to define vision and products Learning from past experience. Statistics from initial home page External Context Organizational IT Dynamic Capabilities Developed: Strategic Foresight

Phase 2. Focusing on Strategy Development External Context Organizational IT Dynamic Capabilities Developed: Strategic Flexibility Leveraging and co-opting resources. Ecuanet’s infrastructure Ecuanet’s marketing and technical expertise WebPromote’s expertise in search engines Focusing. Clear goals and time table Integrating into core activities. Existing information-based products Investing. Hardware and software Experimenting. Web site prototype development

Phase 3. Growing the Strategy External Context Organizational IT Dynamic Capabilities Developed: Trustworthiness & Integration Strengthening relationships. BVG’s record of promoting Ecuador. Relationships with client’s top management Relationships with other web sites Financial Investor Magazine’s database Gaining internal commitment. Four committees assigned to institutionalization. Investing in specialized infrastructure. A computer expert hired; Datawarehouse, hardware, and software acquired

Implications for Practice 1. Presents a powerful example of an Internet strategy success. 2. Underscores the need for managers to integrate Internet strategy, processes, and organizational capabilities and resources in pursuit of objectives 3. Provides awareness of strategies and tactics to develop required capabilities via firm-specific resources.