The document discusses the role of the general manager in utilizing the internet to gain a competitive advantage, noting they must understand whether their company is an incumbent legacy firm or new internet entrant, formulate an internet strategy to determine where the company needs to go next and how to get there, and champion or sponsor the execution of this strategy through the organization.

1. fsg: 8/2004/GMI
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THE GENERAL
MANAGER AND THE
INTERNET
Francis Stevens George
Krooman Consulting

2. THE ROLE OF THE GENERAL MANAGER
fsg: 8/2004/GMI
 To guide his or her organisation to meet its
performance goals and mission
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 To attain and maintain a competitive advantage
 To use the internet [and related technologies] to
reinforce an existing competitive advantage or to
gain a new one

3. IMPORTANT FACTORS
fsg: 8/2004/GMI
 Incumbent or pure-play Internet new entrant
 Formulation and execution of a good strategy
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 The characteristics of the general manager

4. IMPLEMENTING AN INTERNET STRATEGY-
KEY QUESTIONS
fsg: 8/2004/GMI
 Where is the company as far as the internet is
concerned?
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 Where does the company go next?
 How does it get there?
 How does it implement the decisions to get there?

5. TYPES OF COMPANIES
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 Incumbent: Bricks and Motar or lrgacy
companies. They were in existence prior to the
adoption of the internet by their industries.
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 New Entrants: Pure-play companies. Those that
enter markets that rest on the Internet and were
nonexistent prior to the Internet, and those that
use the Internet to enter existing markets.

6. INCUMBENT: ADVANTAGES
fsg: 8/2004/GMI
 Complementary Assets: brand name,
distribution channels, client relations, supplier
relations etc
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 Technology Is Easy to Imitate: parts or even
the whole of an Internet business model is easy
to imitate or outdo

7. INCUMBENT: DISADVANTAGES
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 Dominant Managerial Logic: framework is
which information is scan and decisions are made
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 Competency Trap: the inability to shed old
successful ways of doing things and embrace new
ones
 Fear of Cannibalization and Loss of
Revenue

8. INCUMBENT: DISADVANTAGES-CONT
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 Channel Conflict: existing sales forces
and distributors fight against the new
channels rather than see their revenues to
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new channels
 Political Power
 Co-opetitor Power: customers, suppliers
with whom the firm has to compete will
affect the company in its adoption of the
internet
 Emotional Attachment
 Fear of the New Technology

9. NEW ENTRANTS: ADVANTAGES
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 Less Inertia: no dominant managerial logic, no
competency traps, no channel conflicts, no
emotional attachment and so forth
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 Equity Capital: (at least in the late 1990s and
early 2000)
 Attraction for Talent

10. NEW ENTRANTS: DISADVANTAGES
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 Lack Complementary Assets
 Technology Easy to Imitate
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11. FORMULATING AND IMPLEMENTING
STRATEGY
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 Where is the company?
-Appraise business model
-Strenghts and Weaknesses
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-Sources of competive advantage
-Are sources sustainable?
 Where does the company go next?
-Strategic intent?
 How does the company get there?
-Acquiring capabilities

12. PERSONAL ROLE OF GM
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 Champions
 Sponsors(Mentor, Coach)
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13. CONCLUSION
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 GM should understand important
differences between legacy firms in the
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industries prior to internet-and the new
entrants
 Where incumbent or new entrant, it must
formulate and execute an internet
strategy
 Guiding the firm through this strategy
process requires certain characteristics:
champion or sponsor.

14. REFERENCES
fsg: 8/2004/GMI
 G.M. Hamel and C.K. Prahalad, Competiting for
the Future
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 Afua and Tucci, Internet Business Models and
Strategies