1. Value Configurations Principles for Internet Strategy V.T. Raja, Ph.D., College of Business Oregon State University

2. Value Configurations Source: Chapter 7 of book by Afuah and Tucci Chain Shop Network FindSolve EvaluateExecute Choose

3. Value Chain Source: Michael Porter What is basic premise of value chain? –Value created by transforming inputs into products Inbound Logistics OperationsOutbound Logistics Marketing & Sales After- sales Service Firm Infrastructure Human Resources Management Technology Development Procurement

4. Value Shop Source: Chapter 7 of book by Afuah and Tucci Problem Finding & Acquisition Problem Solving Control/ Evaluation Execution Choice Firm Infrastructure Human Resources Management Technology Development Procurement Simon’s Problem Solving Model Infrastructure Support What is basic premise of value shop? –Value created by providing solutions to customer problems

5. Value Network Source: Chapter 7 of book by Afuah and Tucci Network promotion and contract management Invite and select customers to join network Initialize, manage and terminate contracts Firm Infrastructure Human Resources Management Technology Development Procurement Service provisioning  Establish, maintain and terminate links  Billing for value received Infrastructure operation  Maintain and run physical and information network What is basic premise of value Network? –Value created by providing intermediary services

6. Combinations of Value Configuration Automobile manufacturers: mass production Cisco: solves problems EBay: auction network FindSolve EvaluateExecute Choose

7. Principles for Internet Strategy (Porter) Strategic Positioning Start with the right goal Deliver a unique value proposition Develop a distinctive value chain configuration Make trade-offs for robust strategy Fit all elements of company to the strategy Maintain continuity of direction