Introduction to E-business Models
Before any business can consider a move to electronic process or e-process, it is essential to decide on an e-business model.
One motto holds true when discussing eBusiness models, it pays to be adaptable.
Once a primary model (typically B2B or B2C) has been selected, the enterprise needs to define its purpose in more detail.
In many ways, eBusiness technology challenges the value chain
- globalization, and
mean that eBusiness success is largely determined by how efficiently the business invents or reinvents itself to create and distribute its goods and services.
Competitive advantage is achieved when the business can do this at lower cost, or more expertly than the competition.
The competition does not need to be a new competitor, but only a business that has recognized and implemented a new way of driving revenue.
All models have the following things in common. They should have customer focus, create value, and aim to transform business process into digital.
They should decentralize management, centralize coordination, and most importantly, integrate current process with plans for expansion and change.
A model provides the architecture for the products, services, and information flows, and specifies sources of revenue and the position of the business within the value chain.
It also begins to identify who will be involved in the process, both from within and from outside the business.
In many ways, the business model is a strategic tool and guide for both the architect and the principal business players, showing all parties what they need to achieve and indicating when they have achieved it.
How do you construct a model?
You can build a model from existing "tried-and-true" models, or you can design it from scratch.
In many cases, businesses are merging features from various models into hybrids.
In this module, we will discuss some of the more prominent basic models that are in use today.
At the end of this module, you will be able to:
- List and differentiate between perceived and actual benefits of eBusiness
- Identify the various B2B models available
- Identify the various B2C models
- Differentiate between various Brokerage models
- Identify the various Advertising models
An enterprise may adopt an eBusiness approach for the same reasons it would adopt any business strategy; reducing costs and competing with new business are two of the most compelling reasons. These and other reasons for adopting an eBusiness approach will be examined in the next lesson.