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Analyzing the External Environment for e-Business <br />A Systemic Approach on Business Strategy for the Companies that ha...
What was the motive? <br /><ul><li>   Vague Sector Borders
  Rapid Changes
Interoperability</li></ul>“Good industry analysis does not just list pluses and minuses but sees an industry in overall, s...
The conventional optical view <br />Social<br />Economic<br />Macro External Environment<br />Micro External Environment<b...
What methods are available? <br /><ul><li>   PEST Analysis
  Porter’s 5 Forces
 Priority Matrix</li></li></ul><li>PEST Analysis<br />
Porter’s 5 Forces<br />Potential Entrants<br />Suppliers<br />Byers<br />Industry Rivalry<br />Substitutes<br />
Priority Matrix<br />Probable Impact on Corporation<br />High<br />Medium<br />Low<br />High Priority<br />High Priority<b...
How are these methods used?<br />PEST + 5F = Priority Matrix<br />Priority Matrix + Action Plans = Actions<br />Actions + ...
Internet as a System – Assumptions<br />In order to better understand a system we must first specify it’s defining functio...
Internet as a System – Assumptions<br />Principles:<br /><ul><li>Basic economic principles
Moore’s & Metcalfe’s Laws
Consists of two essential parts</li></li></ul><li>Internet as a System – Essential Parts<br />Essential Parts:<br /><ul><l...
Groups of Individuals and Special Interest Groups </li></li></ul><li>Strategic Point n<br />Strategic Point C<br />Strateg...
Internet as a System – Essential Parts<br />Essential Parts’ Properties :<br /><ul><li>Every essential part has impact on ...
Essential parts can’t operate on their own
If parts of a system are organized into subsystems, then they have the same properties with the essential parts</li></li><...
Time
Actors
Environment: what is out of your network horizon
Grow your network (not necessarily more parties)</li></li></ul><li>ARA and Case Study Methodology<br />Activities – Resour...
Resources (resource ties)
Actors (actor bonds)
Further elements were added:
Commitments (Easton, 2009)
Actors’ cognitions (Welch and Williams, 2002)</li></ul>Case studies as a methodology<br /><ul><li>Use of methodology to de...
Triangulation of data (Beverland and Lindgreen, 2010)
The study is of exploratory nature
Difficulty in obtaining data for the model</li></li></ul><li>Case #1 - Orbitz<br />Milestones<br /><ul><li>  Online travel...
  5 airlines join forces - Orbitz
  Technology + business moves
  Reactions from agents
  Reactions from other airlines
  The future</li></li></ul><li>Network Pictures - Before<br />
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Analyzing the External Environment for e-Business

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A Systemic Approach on Business Strategy for the Companies that have strong bonds with the Internet

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  • New approaches to external environment analysis for e - business, through the use of network approach and the strategic points of control concept.
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Analyzing the External Environment for e-Business

  1. 1. Analyzing the External Environment for e-Business <br />A Systemic Approach on Business Strategy for the Companies that have strong bonds with the Internet<br />Andreas C. Bitros<br />HSSS 2011<br />Antonis G. Ventouris<br />
  2. 2. What was the motive? <br /><ul><li> Vague Sector Borders
  3. 3. Rapid Changes
  4. 4. Interoperability</li></ul>“Good industry analysis does not just list pluses and minuses but sees an industry in overall, systemic terms” M. Porter 2008<br />
  5. 5. The conventional optical view <br />Social<br />Economic<br />Macro External Environment<br />Micro External Environment<br />Creditors<br />Special Interest <br />Groups<br />Funding<br />Suppliers<br />Company<br />Competitors<br />Government<br />Communities<br />Employees<br />Trade<br />Associations<br />Shareholders<br />Customers<br />Political<br />Technology<br />
  6. 6. What methods are available? <br /><ul><li> PEST Analysis
  7. 7. Porter’s 5 Forces
  8. 8. Priority Matrix</li></li></ul><li>PEST Analysis<br />
  9. 9. Porter’s 5 Forces<br />Potential Entrants<br />Suppliers<br />Byers<br />Industry Rivalry<br />Substitutes<br />
  10. 10. Priority Matrix<br />Probable Impact on Corporation<br />High<br />Medium<br />Low<br />High Priority<br />High Priority<br />Medium Priority<br />High<br />High Priority<br />Medium Priority<br />Low Priority<br />Probability of Occurrence<br />Medium<br />Medium Priority<br />Low Priority<br />Low Priority<br />Low<br />
  11. 11. How are these methods used?<br />PEST + 5F = Priority Matrix<br />Priority Matrix + Action Plans = Actions<br />Actions + Monitoring = Feedback<br />
  12. 12. Internet as a System – Assumptions<br />In order to better understand a system we must first specify it’s defining function in a wider system<br />In our case the defining function of the internet is “to provide value to direct and indirect users”<br />
  13. 13. Internet as a System – Assumptions<br />Principles:<br /><ul><li>Basic economic principles
  14. 14. Moore’s & Metcalfe’s Laws
  15. 15. Consists of two essential parts</li></li></ul><li>Internet as a System – Essential Parts<br />Essential Parts:<br /><ul><li>Companies related to I.T.
  16. 16. Groups of Individuals and Special Interest Groups </li></li></ul><li>Strategic Point n<br />Strategic Point C<br />Strategic Point B<br />Strategic Point A<br />Companies<br />Perceived Value-Experience<br />Money - Labor<br />Group C<br />Group A<br />Group n<br />People<br />Group B<br />
  17. 17. Internet as a System – Essential Parts<br />Essential Parts’ Properties :<br /><ul><li>Every essential part has impact on the properties or/and behavior of a system
  18. 18. Essential parts can’t operate on their own
  19. 19. If parts of a system are organized into subsystems, then they have the same properties with the essential parts</li></li></ul><li>Networks<br />Products = Black boxes (Slater, 2002)<br />However, products are also relationships (social level)<br />Aim: optimization of your network, through strategizing, instead of mere satisfaction (Mouzas et al., 2008)<br />Network pictures<br /><ul><li>Present differences as a result of:
  20. 20. Time
  21. 21. Actors
  22. 22. Environment: what is out of your network horizon
  23. 23. Grow your network (not necessarily more parties)</li></li></ul><li>ARA and Case Study Methodology<br />Activities – Resources – Actors (Hakansson and Snehota, 1995)<br /><ul><li>Activities (activity links)
  24. 24. Resources (resource ties)
  25. 25. Actors (actor bonds)
  26. 26. Further elements were added:
  27. 27. Commitments (Easton, 2009)
  28. 28. Actors’ cognitions (Welch and Williams, 2002)</li></ul>Case studies as a methodology<br /><ul><li>Use of methodology to describe a case (Dubois and Araujo, 2004)
  29. 29. Triangulation of data (Beverland and Lindgreen, 2010)
  30. 30. The study is of exploratory nature
  31. 31. Difficulty in obtaining data for the model</li></li></ul><li>Case #1 - Orbitz<br />Milestones<br /><ul><li> Online travel agents dominate the market
  32. 32. 5 airlines join forces - Orbitz
  33. 33. Technology + business moves
  34. 34. Reactions from agents
  35. 35. Reactions from other airlines
  36. 36. The future</li></li></ul><li>Network Pictures - Before<br />
  37. 37. Network Pictures - After<br />
  38. 38. Case #2 - Netflix<br />Milestones<br /><ul><li> Video Rental Blockbuster dominates the market
  39. 39. Netflix launches a Subscription based Model
  40. 40. Technology + Early Adopters
  41. 41. Building the competitive advantage
  42. 42. Reactions from Studios
  43. 43. The future</li></li></ul><li>Network Pictures - Before<br />
  44. 44. Network Pictures - After<br />
  45. 45. The 3 Methods’ Weaknesses<br />
  46. 46. Strategic Points<br />Potential Entrants<br />Potential Entrants<br />Potential Entrants<br />Potential Entrants<br />Suppliers<br />Byers<br />Industry Rivalry<br />Suppliers<br />Byers<br />Industry Rivalry<br />Suppliers<br />Byers<br />Industry Rivalry<br />Suppliers<br />Byers<br />Industry Rivalry<br />Substitutes<br />Substitutes<br />Substitutes<br />Substitutes<br />
  47. 47. Strategic Points<br />O’ Reilly Web 2.0 Summit #w2smap<br />
  48. 48. Strategic Points<br /><ul><li>Semiconductors
  49. 49. Infrastructure
  50. 50. Platforms & Mobile
  51. 51. OS & UI
  52. 52. Social Activity & Location
  53. 53. Identity & Consumer Web
  54. 54. Search
  55. 55. Commerce & e-Payment
  56. 56. Content & Media & Games
  57. 57. Advertise
  58. 58. Enterprise Solutions</li></li></ul><li>Key User Groups<br /><ul><li>Innovators/Alpha Geeks
  59. 59. Early Adopters
  60. 60. Early Majority
  61. 61. Late Majority
  62. 62. Laggards
  63. 63. Government
  64. 64. VC & Other Funding
  65. 65. Enterprises</li></li></ul><li>Strategic Points<br />In our analysis we present the interactions between the Strategic Points according to Porters’ 5 forces<br />
  66. 66. Strategic Points<br />
  67. 67. Strategic Points<br />
  68. 68. Strategic Points<br />
  69. 69. Strategic Points Analysis<br /><ul><li> A two Layer Network</li></ul>Outer Layer<br />Inner Layer<br />
  70. 70. Strategic Points Analysis<br /><ul><li> Best Points for Expansion
  71. 71. Social Activity & Location 64%
  72. 72. Identity & Consumer Web 73%
  73. 73. Search 64%
  74. 74. Best Customer - Partner
  75. 75. Content & Media & Games 64%</li></li></ul><li>Strategic Points Analysis<br /><ul><li>No direct Threat of Substitutes (among strategic points)
  76. 76. Online VS Offline on three sections</li></li></ul><li>Conclusions<br /><ul><li>Even combined, the 3 methods present gaps.
  77. 77. Strategic points help by treating different groups as having multiple roles - but the concept needs additions.
  78. 78. Strategic points don’t refer specifically to competition – it can come from everywhere.
  79. 79. It’s important to define the kind of connections (actors, resources, activities?).
  80. 80. Time is of essence
  81. 81. Views are subjective</li></li></ul><li>Limitations – Further research<br />Limitations<br /><ul><li> Only 2 cases – results cannot be generalized
  82. 82. Not all Strategic Points are represented in each case
  83. 83. The model is based heavily on online factors
  84. 84. At it’s current structure it doesn't include regulatory bodies or users.</li></ul>Further Research<br /><ul><li> Support from more cases
  85. 85. Depth interviews/focus groups: how actors identify the network
  86. 86. Addition of more points in the model (i.e. data, users)</li></li></ul><li>Questions?<br />Andreas C. Bitros @AndrewBit<br />Antonis G. Ventouris @antventouris<br />

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