The impact of the electronic communications on traditional businesses

During the same period managers at established businesses have had to determine how to apply new electronic communications technologies to transform their organisations. As we will see later in this chapter, existing businesses have evolved their approaches to e-business through a series of stages. Innovation in e-business is relentless, with the continuous intro­duction of new technologies, new business models and new communications approaches. So all organizations have to review new electronic and Internet-based communications approaches for their potential to make their business more competitive and also manage ongoing risks such as security and performance . For example, current opportunities which many businesses are reviewing the benefits, costs and risks of implementing include:

• The growth in popularity of social networks such as Bebo, Facebook (Case Study 1.1) and MySpace, virtual worlds such as Habbo Hotel and Second Life, and blogs created by many individuals and businesses;
• Rich media such as online video and interactive applications into their web sites;
• Selection of mobile commerce services which exploit the usage of mobile phones and other portable wireless devices such as laptops around the world. The potential of mobile commerce is evident from research by Wireless Intelligence (2008) which found that at the end of 2007, globally there were 3 billion subscriber connections (representing half the planet’s population) with penetration rates in developing countries such as India (21%) and China (41%) showing the potential for future growth;
• Using location-based tracking of goods and inventory as they are manufactured and transported.

You can see that an organization’s capability to manage technology-enabled change is the essence of successfully managing e-business. The pace of change and the opportunities for new communications approaches make e-business and e-commerce an exciting area of busi­ness to be involved in.

In E-Business and E-Commerce Management we will explore approaches managers can use to assess the relevance of different e-business opportunities and then devise and implement strategies to exploit these opportunities. We will also study how to manage more practical risks such as delivering a satisfactory service quality, maintaining customer privacy and managing security. We introduce some of the opportunities and risks later in this chapter.

In this chapter we start by introducing the scope of e-business and e-commerce. Then we review the the main opportunities and risks of e-business together with the drivers and bar­riers to adoption of e-business services. Finally, we will look at some of the organizational challenges of managing e-business using the classic McKinsey 7S strategy framework.

Source: Dave Chaffey (2010), E-Business and E-Commerce Management: Strategy, Implementation and Practice, Prentice Hall (4th Edition).