EUNITE 2001, December The Mobile Commerce Quest for Value-Added Products & Services Pirkko Walden IAMSR/Abo Akademi University

EUNITE 2001, December MOBILE COMMERCE Key Success Factors Customer ownership [ key for banking, brokerage; others only if value-added for producers & customers; customers kept only through value added and best business practice] Personalisation Localisation Ubiquity Timeliness Convenience Pricing

EUNITE 2001, December MOBILE COMMERCE M-commerce, products & services Services: intangible, no ownership defined Products: tangible, ownership defined Digital products: intangible, ownership defined Digital services: intangible, no ownership defined Digital products & services: intangible, ownership is defined Digital services & products: intangible, ownership is not defined

EUNITE 2001, December MOBILE COMMERCE Conceptual framework, customer perspective Flexibility, products & services available anywhere, at any time and anyhow Value-adding, products & services should improve productivity, be adaptive to localisation, be sensitive to customer personalisation A mobile technology basis, should use innovative and distinguishing features of mobile technology

EUNITE 2001, December MOBILE COMMERCE Conceptual framework, producer perspective Modularity, products & services to be built from a core of generic modules; should support flexibility Layers, products & services should be built in layers to add attributes, characteristics; should support value- adding Bundling, products & services built through a bundling of modular products and service; use the mobile technology basis

EUNITE 2001, December MOBILE COMMERCE Conceptual framework, management perspective Value/cost ratios, products & services should show good/very good value for cost in benchmarking Production, logistics, marketing and advertising, value chain activities, products & services should have innovative features through mobile technology when benchmarked Business model, products & services should use innovative & distinguishing features of business

EUNITE 2001, December MOBILE COMMERCE M-commerce, products & services [Kontinen] M-commerce: multimodal, mobility Var A: mobile client, standard services, separate voice Var B: + services, aware of client location Var C: + moving services, aware of own location Var D: + services, aware of other clients in vicinity

EUNITE 2001, December MOBILE COMMERCE M-commerce, products & services [Keen] M-commerce: freedom of choice the key issue Follows: knowledge mobilisation among producers, users, management, employees and in peer-to-peer Proposal: b-to-b is going to be the first breakthrough, wireless support for employees the second Value networks (?): a better metaphor will be dynamic value entities, which change shape with the context

EUNITE 2001, December MOBILE COMMERCE M-commerce, products & services Our proposal: probably not single (killer) entities Then follows: synergistic combinations, which can be simplified over time And thus: key features can be given to individual products & services Possible variations: (i) b-to-b, (ii) b-to-c, (iii) b-to- employee, (iv) peer-to-peer

EUNITE 2001, December MOBILE COMMERCE INTERELATIONS: co-production, technology, content, information, design PROD 1 PERS LOCAL UBI TIME CON PRICE PROD 2 PERS LOCAL UBI TIME CON PRICE SERV 1 PERS LOCAL UBI TIME CON PRICE SERV 2 PERS LOCAL UBI TIME CON PRICE PERS – Personalisation LOCAL-Localisation UBI-Ubiquity TIME-Timeliness CON-Convenience PRICE-Pricing

EUNITE 2001, December MOBILE COMMERCE CUSTOMER PERSPECTIVE: Flexibility, Value-adding, Mobile technology adoptive PROD 1 PERS LOCAL UBI TIME CON PRICE PROD 2 PERS LOCAL UBI TIME CON PRICE SERV 1 PERS LOCAL UBI TIME CON PRICE SERV 2 PERS LOCAL UBI TIME CON PRICE PERS – Personalisation LOCAL-Localisation UBI-Ubiquity TIME-Timeliness CON-Convenience PRICE-Pricing

EUNITE 2001, December MOBILE COMMERCE PRODUCER PERSPECTIVE: Modularity, Layers, Bundling PROD 1 PERS LOCAL UBI TIME CON PRICE PROD 2 PERS LOCAL UBI TIME CON PRICE SERV 1 PERS LOCAL UBI TIME CON PRICE SERV 2 PERS LOCAL UBI TIME CON PRICE PERS – Personalisation LOCAL-Localisation UBI-Ubiquity TIME-Timeliness CON-Convenience PRICE-Pricing Modules Layers Bundle

EUNITE 2001, December MOBILE COMMERCE MANAGEMENT PERSPECTIVE: Value/cost ratios, Production & logistics (etc.), Business models PROD 1 PERS LOCAL UBI TIME CON PRICE PROD 2 PERS LOCAL UBI TIME CON PRICE SERV 1 PERS LOCAL UBI TIME CON PRICE SERV 2 PERS LOCAL UBI TIME CON PRICE PERS – Personalisation LOCAL-Localisation UBI-Ubiquity TIME-Timeliness CON-Convenience PRICE-Pricing

EUNITE 2001, December MOBILE COMMERCE M-commerce, killer applications Killer cocktail: a mix in which components cannot be identified Killer pizza: a mix in which components can be distinguished Killer bouquet: the aggregate > the sum of parts Killer soup: the more ingredients, the better it gets; operator needed for stirring Killer fondue: as for the soup, no operator needed

EUNITE 2001, December MOBILE COMMERCE INTERELATIONS: co-production, technology, content, information, design PROD 1 PERS LOCAL UBI TIME CON PRICE PROD 2 PERS LOCAL UBI TIME CON PRICE SERV 1 PERS LOCAL UBI TIME CON PRICE SERV 2 PERS LOCAL UBI TIME CON PRICE PERS – Personalisation LOCAL-Localisation UBI-Ubiquity TIME-Timeliness CON-Convenience PRICE-Pricing Bouquet

EUNITE 2001, December MOBILE ICT BUSINESS Key principles: Embedding processes in software brings the internal operations and capabilites of the company forward into the customer relationship interface. In a sense, this concentrates the business into the software; it transforms organisational value chain activities spread across locations and time zones to capabilities at hand, now and anywhere. It transforms business by enabling personalisation, localisation, ubiquity, timeliness, convenience and neew pricing models

EUNITE 2001, December MOBILE ICT BUSINESS Embedding processes in software is win-win for customer and provider. Out-tasking – getting rid of a process – is win-win. In-sourcing – using advanced know how developed by somebody else – is win-win. Company wins by interacting with a best practice eProcess capability. Customer wins as service is being handled by a best- practice provider. The provider wins by + revenue and + market

EUNITE 2001, December OUT-TASKING & IN-SOURCING PARTNER I PARTNER IIVIRTUAL CORPORATION

EUNITE 2001, December MOBILE ICT BUSINESS Building speed [Keen]. Business design and organizational structuring are constrained by geography, physical location, workflows, time and the links with capital investment demands. eProcess companies can get access to world-class capabilities in months rather than years. A first-rate technology platform and a solid base of repeat customers more and more capabilties at less and less capital cost.

EUNITE 2001, December MOBILE ICT BUSINESS eProcess strategies [Keen]. eProcess edge over traditional companies: information-rich relationships with customers and organizational flexibility through in-sourcing; out-tasking simplifies operations and improves service. Build in-house capabilities: these form the operational basis for the company: Enable people with knowledge and access to work effectively Support knowledge work with high-touch and –texture interfaces Embed company rules into software interfaces Build internal systems that provide high-value functionality eProcess techniques to decide where and how to focus in-house capabilities

EUNITE 2001, December MC BUSINESS MODEL A Bouquet of Bundles PROD 1 SERV 1 SERV 2 PROD 2 SERV 3 SERV 2 B-TO-C

EUNITE 2001, December MC BUSINESS MODEL B-to-C Bundles are combinations of products & services A bouquet can be built from (i) bundles or (ii) from combinations of individual products & services. A bouquet is built to offer Flexibility – availability anywhere, at any time and anyhow Value-added – will improve productivity, will be adaptive to localisation, will be sensitive to customer personalisation Mobile technology adoption- will use innovative and distinguishing features of mobile technology to enhance flexibility and value-added

EUNITE 2001, December MC BUSINESS MODEL B-to-B The same bouquets or bundles are used as in the B-to-C model The customer is a business. A bouquet is built to offer Flexibility – availability anywhere, at any time and anyhow Value-added – in production, logistics, marketing & advertising: value chain activities for bringing m-commerce products & services to the markets Mobile technology adoption- will induce (i) business process reengineering, (ii) multimodality, (iii) out-tasking, (iv) in- sourcing, (v) new logistical solutions

EUNITE 2001, December MC BUSINESS MODEL B-to-B [cont.] Bouquets are adapted to customers and made ubiquitous with layers, adapted to localisation, personalisation and timeliness through modules built for customer convenience with variations of the mobile technology and the use of a choice of platforms (smart phones, WAP, communicators, PDA, digiTV, WLAN etc.) Structured and built for flexibility and value-added The bouquet structure of m-commerce products & services supports the out-tasking and in-sourcing business models [cf. next slide]

EUNITE 2001, December MC BUSINESS MODEL A Bouquet of Bundles PROD 1 SERV 1 SERV 2 PROD 2 SERV 3 SERV 2 B-TO-B OUT-TASKING Partner I OUT-TASKING Partner I IN-SOURCING Partner II

EUNITE 2001, December MC BUSINESS MODEL B-to-B [cont.] Partners I and II work on Product entities and Service entities in a bouquet Modules forming products & services Layers, which are included in products & services Bundling products & services Logistics Marketing and advertising Management, and maybe even Planning

EUNITE 2001, December MC BUSINESS MODEL B-to-B [cont.] The mobile commerce business model may have side effects on consortium and business partners in traditional business The mobile technology used/enhanced/improved/developed to serve mc business models may traditional solutions in Production Logistics Marketing and advertising Management, and maybe even Planning Thus, m-commerce may introduce competitive advantages also in tradional industry

EUNITE 2001, December MC BUSINESS MODEL B-to-Employee Both B-to-C and B-to-B solutions may be adapted to B-to-E Involves (i) an adaptation of modules to fit the corporate intranet and corporate standard mobile solutions, (ii) the choice and adaptation of layers to fit employee work context and tasks, and (iii) the building of company-specific bundles or bouquets These B-to-E solutions can be offered by (i) the producer of m- commerce products & services to its own employees, (ii) the out- tasking and/or in-sourcing partners to their own employees, (iii) other business partners in traditional business, (iv) through licensing to any corporate customers or by (v) licensing partners to any corporation

EUNITE 2001, December MC BUSINESS MODEL B-to-Employee [cont.] The B-to-E solutions may have some interesting consequences Employees (E) will/can work with and understand the m-commerce products and services E gain the same value-added in their own work as B or C partners Knowledge mobilisation among E Out-tasking and in-sourcing may become possible between and within teams working in the same organisation Freedom of choice to work wireless anywhere, anytime and anyhow while moving Corporate structure will be simplified, virtual, adaptive, flexible, fast in reaction and knowledge based

EUNITE 2001, December MC BUSINESS MODEL Peer-to-Peer Principle: B-to-C products & servicces move out of the control of B to become P-to-P distributed (and loved by the network operators, which will gain in cash flow) B can control Bouquets or Bundles, and (i) allow or (ii) not allow P-to-P distribution; this can be controlled through proprietary software or possibly encryption B may be interested in allowing P-to-P distribution in order to create a market; could include some mechanism to collect a (small) fee per user/customer/usage time unit/volume, etc. If in-sourcing & out-tasking is used there may be restrictions on the use of modules, layers and bundles

EUNITE 2001, December MC BUSINESS MODEL Peer-to-Peer [cont.] Products & services may be modified for P-to-P usage by Deleting or modifying modules Controlling the use of layers Adapting or tailoring bundles P-to-P can be used to create Clubs, User Groups, Virtual Tribes – groups sharing in modification and application solutions

EUNITE 2001, December MOBILE COMMERCE M-commerce vs. e-commerce Overall: focus on the following issues as compared to e-commerce Changes in fundamentals Significant changes in technology Modifications of products & services Mobile enhancements of e-commerce products & services Business models Pricing