Chapter One Moving from E-commerce to E-business E-Business Why Study E-business? Promise: Reality: Streamlined Business Blizzard of Buzzwords Process Automation Customers.com Adaptive Supply Chains Lack of Framework ERP CRM Digital Economy SCM Network Infrastructure Portals Exchanges The scale and scope of modern IT investments requires that managers have a clear understanding of e-business fundamentals! © E-Business Strategies, Inc 2- E-Business Consequences of not Studying E-business? Incompatible Projects Order Fulfillment Locally Optimized Business Processes Procurement CRM ERP Poorly Designed Business Processes © E-Business Strategies, Inc Persistent Channel Conflicts & CrossDepartment Tensions 3- Resistance to Changes E-Business Need for a Robust Framework E-business Course Goals Rationalize buzzwords Recognize commonalties across business environments Framework for designing more effective new systems Provide a Managerial Perspective A set of basic principles Understand how to map business needs to ebusiness solutions Synthesis Information Technology (IT) changes, but management principles persist! © E-Business Strategies, Inc 4- E-Business Framework for Book Business Strategies and Processes Drive Enable E-business Applications Drive Enable IT Infrastructure © E-Business Strategies, Inc 5- What is the basic framework that ties business strategies to applications? What are the key ideas of e-business strategies and how they translate into e-business design to align IT with business needs? E-Business Table of Contents E-commerce vs E-business? E-Business Success Stories Ten Rules of E-business What does this mean for managers – Looking Deep Key Take-Aways © E-Business Strategies, Inc 6- E-Business E-commerce Refers to selling of products and services over the Web Transactions fall into three categories: – Business-to-business (B2B) – Business-to-consumer (B2C) – Consumer-to-consumer (C2C) The goal of e-commerce is to reduce transaction costs © E-Business Strategies, Inc 7- E-commerce Progression Complex Communities of Interest Mega-Portals E-commerce Transactions Functionality E-Business Web Storefront Brochure ware Limited E-commerce Maturity E-commerce has evolved rapidly since 1995 © E-Business Strategies, Inc 8- E-Business E-business The back-office applications, systems or processes that create goods and/or provide services E-business includes: – – – – – Customer Relationship Management Enterprise Resource Planning Supply Chain Management Human Resource Management Systems And more © E-Business Strategies, Inc 9- E-Business E-commerce vs E-business E-commerce E-business value added “INPUTS” “OUTPUTS” TRANSFORMATION • • • • • • People • Raw Material Processes Facilities Equipment Finance People • Serves Customers • Product Sold E-business: The transformation of key business processes through the use of Internet technologies! © E-Business Strategies, Inc 10 - E-Business Creating the New Technoenterprise: Integrate, Integrate, Integrate App integration key to ebusiness – Not easy, requires major app overhaul for integrated frontend/back-end infrastructure – Integrated app architecture critical with advent of ecommerce – Threat of losing customers looming large with advent of new market entrants © E-Business Strategies, Inc 38 - Strategy Process Customer Needs Corporate Strategy Process Strategy Application Integration Decisions E-Business Ten Rules of E-business: Rule The goal of new business designs is for companies to create flexible outsourcing alliances that not only off-load costs but also make customers ecstatic E-business enabled outsourcing a big deal – Pressure by shareholders for double-digit revenue growth – CEOs have already reengineered, downsized and cut costs; now looking at technology to transform business model and deliver results © E-Business Strategies, Inc 39 - E-Business Ten Rules of E-business: Rule For urgent e-business projects its easy to minimize application infrastructure needs and to focus on the glitzy front end apps The oversight can be costly in more ways than one – Decision to adopt e-business architecture is a business, not technical, decision The lack of attention to the back-office systems and process side of E-business is the primary reason for many project failures © E-Business Strategies, Inc 40 - E-Business Ten Rules of E-business: Rule The ability to plan an e-business infrastructure course swiftly and to implement it ruthlessly are key to success; ruthless execution is norm – Most e-business strategies in dire straits even before they start – Managers often don’t understand complexity of converting strategy into a working architecture The goal of every successful e-business strategy is help the firm either save or make money © E-Business Strategies, Inc 41 - E-Business Ten Rules of E-business: Rule 10 The tough task for management is to align business strategies, processes, and applications fast, right, and all at once; Strong leadership is imperative – Many managers good at planning strategy and looking at things strategically but not at implementing strategy – Implementation takes leadership, commitment and backbone – “Creative destruction” or breaking free from habits of past necessary © E-Business Strategies, Inc 42 - E-Business Table of Contents E-commerce vs E-business? E-business Success Stories Ten Rules of E-business What does this mean for managers – Looking Deep Key Take-Aways © E-Business Strategies, Inc 43 - E-Business Current Issues in E-Business Effectively consolidating the processes and IT operations resulting from mergers Developing flexible supply chains – physical, information and financial to enable mass customization of products and services Managing global supplier, production and distribution networks The customer oriented integration using technology to combat the increased “commoditization” of products/services Using self-service to cut internal and external operating costs © E-Business Strategies, Inc 44 - E-Business Are You Ready? Does senior management understand? – Implementation side of strategy? – That entire business platform is being transformed by new technology that tightly integrates internal and external processes? – The risks, challenges in integrating and implementing enterprise apps necessary for an ebusiness enterprise? – What it takes to build inter-enterprise, techsupported processes, such as SCM, that form backbone of ebusiness? – Do you have baggage – legacy apps, calcified processes, bureaucratic controls and inflexible business models © E-Business Strategies, Inc 45 - E-Business Fundamental Questions in Each Phase • How will e-commerce change our customer priorities? • What new things our customers want? • How can we construct a business design to meet these new customer priorities? • What kind of new applications infrastructure we need to orchestrate the new business design? • What short-term and long-term investments in people, partners, and technology must we make to survive, let alone thrive in this new environment? © E-Business Strategies, Inc 46 - E-Business Are Customers Are Looking for Internet Business Solutions • Customer attitudes — from tactical to strategic • Customers require solutions — not just products and services • Internet business solutions are evaluated and selected by the business decision-makers — not the technical staff • Business decision-makers are looking for a trusted advisor © E-Business Strategies, Inc 47 - E-Business Table of Contents E-commerce vs E-business? E-business Success Stories Ten Rules of E-business What does this mean for managers – Looking Deep Key Take-Aways © E-Business Strategies, Inc 48 - E-Business E-business is NOT about Technology Strategic Business decisions Technology decisions Tactical Time E-business decision-makers are Presidents, CEO’s, CFO’s, and department heads What motivates them – business strategy & direction, NOT technology © E-Business Strategies, Inc 49 - E-Business E-business Management Challenges Why Should Senior Management Be Much More Focused On E-business Decisions Today? The Cost Of Making A Technology Mistake Has Increased Exponentially Siemens invests Billion in Supply Chain Project © E-Business Strategies, Inc Nike reports 400 Million loss due to supply chain software snafu Coco-Cola invest 600 Million in Logistics platform E-Business Questions for every E-business manager • How will e-business transform business models in my industry? • How can e-business help to achieve my business goals and objectives? • What is our e-business design that lets us compete effectively? • What e-business opportunities are attractive for my company? • Based on customer needs, what processes can be streamlined or enhanced by e-business? © E-Business Strategies, Inc 51 - E-Business Strategies, Inc www.ebstrategy.com contact@ebstrategy.com 678-339-1236 x201 Fax - 678-339-9793 ... looking for a trusted advisor © E-Business Strategies, Inc 47 - E-Business Table of Contents E-commerce vs E-business? E-business Success Stories Ten Rules of E-business What does this mean for managers... model, systems © E-Business Strategies, Inc 21 - E-Business Table of Contents E-commerce vs E-business? E-business Success Stories Ten Rules of E-business What does this mean for you – Looking... now looking at technology to transform business model and deliver results © E-Business Strategies, Inc 39 - E-Business Ten Rules of E-business: Rule For urgent e-business projects its easy to minimize