Chapter 9: EC Strategy and Implementation Plan docx

1 © Prentice Hall, 2000 Chapter 9 EC Strategy and Implementation Plan 2 © Prentice Hall, 2000 Learning Objectives  Describe what a business strategy and implementation plan are  Understand the process of formulating EC strategies  Explain the issues involved in EC implementation planning  Experience the role of intelligent agents in the strategic perspective  Characterize how the strategic planning evolves throughout the business cycle  Describe the key management issues in the strategic planning 3 © Prentice Hall, 2000 IBM’s E-Business’s Strategy  Following four goals:  To lead IBM’s strategy to transform itself into e- business and to act as a catalyst to help facilitate that transformation.  To help out business units become more effective in their use of the Internet/intranet, both internally and with their customers.  To establish a strategy for the corporate Internet site. This would include a definition of how it should look, ‘feel’ and be navigated. In short, to create an online environment most conducive to customers doing business with IBM.  To leverage the wealth of e-business transformational case studies there are within IBM to highlight the potential of e-business to IBM’s customers. 4 © Prentice Hall, 2000  IBM focused on key initiatives: IBM’s E-Business’s Strategy (cont.)  e-commerce— selling more goods via the Web  e-care for customers— providing all kinds of customer support on-line  e-care for business partners— dedicated services providing faster, better information for these important groups  e-care for employees— improving the effectiveness of IBMers by making the right information and services available to them  e-procurement— working closely with IBM’s customers and suppliers to improve the tendering process and to better administer the huge number of transactions involved  e-marketing communications— using the Internet to better communicate IBM’s marketing stance 5 © Prentice Hall, 2000 Strategic Planning for EC Industry and competitive analysis Strategy formulation Strategy reassessment Implement-ation plan 6 © Prentice Hall, 2000 Industry and Competitive Analysis  Monitoring, evaluating, disseminating of information from the external and internal environments  SWOT Analysis Strengths Weaknesses Opportunities Threats 7 © Prentice Hall, 2000 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 overcome weaknesses ST Strategies Generate strategies here that use strengths to avoid threats WT Strategies Generate strategies here that minimize weaknesses and avoid threats Industry and Competitive Analysis (cont.) 8 © Prentice Hall, 2000 Strategy Formulation  Strategy formulation  Development of long-range plans  Organization’s mission  Purpose or reason for the organization’s existence  3 main reasons for establishing Web site  MARKETING, CUSTOMER SUPPORT, and SALES  Products with good fit for EC  Shipped easily or transmitted electronically  Targets knowledgeable buyers  Price falls within certain optimum ranges 9 © Prentice Hall, 2000 EC Critical Success Factors  Special products or services traded  Top management support  Project team reflecting various functional areas  Technical infrastructure  Customer acceptance  User friendly Web interface  Integration with the corporate legacy systems  Security and control of the EC system  Competition and market situation  Pilot project and corporate knowledge  Promotion and internal communication  Cost of the EC project  Level of trust between buyers and sellers 10 © Prentice Hall, 2000  A Value Analysis Approach  Value chain  a series of activities a company performs to achieve its goal(s)  Value added  contributes to profit and enhances the asset value as well as the competitive position of the company in the market  to create additional value using EC channels, a company should consider the competitive market and rivalry in order to best leverage its EC assets EC Critical Success Factors (cont.) [...]... customers and trading partners? Will intermediaries be eliminated in the process? Or do we become intermediaries ourselves? How do we bring more buyers together electronically (and keep them there)? How do we change the nature of our products and services? Why is the Internet affecting other companies more than ours? How do we manage and measure the evolution of our strategy? © Prentice Hall, 2000 19 EC Strategy. .. 2000 22 Implementation EC Plan Starts with organizing a project team Undertake a few pilot projects (help discover problems early) Implementing EC Redesigning existing business processes Back-end processes must be automated as much as possible Company must set up workflow applications by integrating EC into existing accounting and financial back-ends © Prentice Hall, 2000 23 Uncovering Specific EC Opportunities... Successful EC Programs Conduct necessary education training Review current distribution and supply chain models Understand what your customers and partners expect from the Web Reevaluate the nature of your products and services Give a new role to your human resources department Extend your current systems to the outside Track new competitors and market shares Develop a Web-centric marketing strategy. .. bills electronically, digital cash widely used, smart cards, and fewer wholesaler/salespeople IT Events : Standards vary between industries, objective measures of Internet security, EDI standards widely adopted Business Events : High-performance information networks, cumbersome global EC Electronic Middlemen Scenario New Consumer Marketing Channels Scenario IT Events : Transaction processing and interface,... Specific EC Opportunities and Application Understand: How digital markets operate How Internet customers behave How competition is created and what infrastructure is needed What are the dynamics of EC Map opportunities that match current competencies and markets Many opportunities to create new products and services © Prentice Hall, 2000 24 Uncovering Specific EC Opportunities and Application (cont.)... Organization and Staffing Define the roles and responsibilities of: Senior management Web champion Webmaster Web Page Design Marketing Finance Accounting Information Technology Gatekeepers Web team Building System Infrastructure Business Process Reengineering Security and Control EC Project Team © Prentice Hall, 2000 27 Evaluating Outsourcing Factors to consider: Ease of configuration and setup Database and. .. Hall, 2000 12 EC Critical Success Factors (cont.) Return on Investment and Risk Analysis A ratio of resources required and benefits generated by an EC project Includes both quantifiable items (cost of resources, computed monetary savings) and non quantifiable items Some intangible benefits effective marketing channel increased sales improved customer service © Prentice Hall, 2000 13 EC Critical Success... Features Electronic shopping mall Unique URL Electronic commerce/financial transactions Shopping cart software Online catalogs Direct order procedures Dynamic databases Static databases Multimedia Telephony © Prentice Hall, 2000 Audio Video FTP Forms Chat rooms VRML Statistics Customer tracking E-mail response and forwarding Java applications Animation Security 34 Security and Control in EC 80% of all... Effective guidelines would be needed to: Address the Internet features that must be monitored for developing policy on access and use Disclosure of information through the Internet © Prentice Hall, 2000 35 Strategy Reassessment Webs grow in unexpected ways — e.g Genentec and Lockheed Martin Reasons for a not having a worthwhile project The goals were unrealistic The web server was inadequate to handle... interface, distributor drive EC, EC activity expands rapidly, and transaction security deeply embedded Business Events : One-stop shopping popular, professional services popular with smaller enterprises IT Events : Activity oriented to consumers, price of wireless drops, and growth of networked multimedia Business Events : Online transactions seen as less convenient, security not widely trusted, basic . Prentice Hall, 2000 Chapter 9 EC Strategy and Implementation Plan 2 © Prentice Hall, 2000 Learning Objectives  Describe what a business strategy and implementation plan are  Understand the process. systems  Security and control of the EC system  Competition and market situation  Pilot project and corporate knowledge  Promotion and internal communication  Cost of the EC project  Level. networks, cumbersome global EC Electronic Middlemen Scenario IT Events : Transaction processing and interface, distributor drive EC, EC activity expands rapidly, and transaction security deeply embedded Business