5:00-6:00 Case discussion: eBricks.com TODAY’S CLASS 5:00-6:00 Case discussion: eBricks.com 6:00-7:00 CRM 7:00-8:00 Paul Strupp, Sun Microsystems “Tools and techniques for Data Mining”
GUEST SPEAKER Monday, March 19 5:00 P.M. Room 224 Paul Strupp Northwestern University Topic: “Strategy and the Start-Up Firm”..
Three Structural Characteristics of a Winner-Take-All Dynamics 1. Strong demand-related network effects 2. Significant cost-related scale economies 3 Intrinsically high customer retention rates
Liquidity Benefits Vs. Transaction Processing Cost Savings - Willing to switch suppliers - Basis for supplier differentiation - High search cost Transaction Processing - Large in relation to order value - Lack of EDI infrastructure - frequent order, multi-item, and high coordination - Multiple approval layers
FOLLOW-UP Jan 2000 Merged with Blueline Online Renamed Cephren Received $42M May 2000 Cephren launched RFQ bidding Oct 2000 Had 200 employees 12,000 online participants Involved in 700 projects in 30 countries Valuation $50 B
THE PRIMARY OBJECTIVES OF eBRICKS.COM CASE STUDY WERE: 1) Discuss structural characteristics that make an industry attractive for B2B 2) Explore two main benefit offered by B2B: increase liquidity and reduced transaction processing costs. 3) Evaluate classical issues that B2B face: - Accept equity from mayor buyers/sellers - Penetrate into few vertical market or expand fast - Horizontal integration decision
Homework due next session Prepare Case: WebVan Read two articles: “Planning for the inevitable product recall” and “BW Special Report: Logistics”