The Meaning of e-business
Using internet technologies for key business processes
Electronic information exchanges between the company and its external stakeholders
B2B (business to business) - e.g. Supermarkets systems automatically placing orders when stocks are low
B2C (Business to Consumer) - Selling over the internet (aCOWtancy.com)
C2B - Groupon - consumers together buying from a business
C2C - Ebay
Technology has helped rigid functional and divisional structures to be replaced by matrix and network systems.
New work patterns have emerged that encourage flexi-working and other family friendly measures. Many business processes are now automated.
Enterprise Resource Planning Solutions (ERP Systems) are now widely available providing management with information that is available almost instantaneously.
Whilst Information Technology may be in fact used as a core competency, it needs to be applied judiciously to suit the specific business needs
The impact of IT on each of Porter’s five forces:
Use IT to reduce the effects of tough competition
Eg.Tour Operators can compare their price competitiveness by accessing the web-sites of other providers on the internet accordingly.
Threat of new Entrants
Sophisticated IT applications are expensive & slow to develop whilst being technologically challenging. On the other hand, IT reduces distribution costs for other industries.
Eg MP3 has created a seismic shift in the music industry by penetrating at a very low cost into an on-line distribution channel compared to its brick and mortar competitors
Increased access to different suppliers decreases the power of the suppliers
Increased knowledge of the market through the Internet has increased the bargaining power of consumers
Threat of Substitutes
Using computer-aided design & manufacture to develop new products first