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Lesson 6 Changing the business using a top-down strategy
Objective Identify the top-down eBusiness issues management should address.

Changing the Business using Top-down Strategy

If any business is going to successfully adapt to the challenges of eBusiness, the change must start at the top. It is easy for a large company, especially a company that is presently a market leader, to become complacent or adopt a half-hearted attitude toward eBusiness.
If, as we have discussed previously in an earlier lesson, the company has chosen to implement eBusiness and has established the reasons for doing so, it must fully commit to this change, and in doing so, recognize that the rules have changed. Sometimes traditional business thinking and existing corporate structure can be an obstacle to success in eBusiness. Management will have to champion the change. To do this, management will have to address the following challenges:
  1. Corporate culture must become more information-centric and globally aware
  2. A new understanding of the customer must be developed
  3. The company must introduce the concept of "Internet time"
Let us review each of these challenges in detail.

Cultivate Global, information-centric Culture

In order to be a successful eBusiness, the corporate culture has to become more information-centric and globally aware. As we noted in an earlier lesson, in many ways, eBusiness technology challenges, and even reverses, the value chain. Management will be forced to think beyond the traditional boundaries of internal process and will have to consider their position within the entire value-chain.
There are a number of strategies you can use to prepare for this shift in perspective:
  1. Plan to extract and use new and better information
  2. Consider the best means to provide new and better information to suppliers
  3. Allocate resources to security, marketing, new products, and new systems research
  4. Consider new partnerships with specialized eBusiness companies such as ASPs and brokers

Redefine the customer

To achieve success as an eBusiness, management will need to redefine the customer, recognizing the following changes:
  1. The customer has greater freedom of choice and requires less incentive to go elsewhere.
  2. The global marketplace means there are more customers available, but with more diverse needs and expectations. Conversely, the global market also increases competition.

Introduce "Internet time"

Finally, management must recognize and introduce the concept of "Internet time." In the Internet world, customers, partners, and suppliers expect compressed timeframes, accelerated schedules, and greater flexibility and availability of product and service. Management must plan for this new process and brainstorm strategies to accommodate it.

Strategies and objectives

There are two approaches to take in introducing and accommodating this new process: "cautious" and "quick-win."
There are two points to remember when considering the consequences of every solution.
  1. It is unlikely that existing legacy systems will be well aligned to a quick-win approach
  2. Where the integrity of the system and approach is paramount and time-to-market is less critical, the cautious approach to developing a robust system has clear advantages

As we have emphasized throughout this course, eBusiness strategies will be different in each case, depending on the goals of the stakeholders. The consequences of each solution must be considered as part of the decision to adopt the solution. The considerations for and consequences of each approach are described in the MouseOver below.

Internet Timeline
  1. If the solution is required to demonstrate a leading edge, state of the art system, it is important to recognize that existing legacy systems are unlikely to be well-aligned to this approach.
  2. If the stakeholders require a quick win, consider the competing need for closed integration with in-house legacy systems. In this case, it is unlikely that the rapid prototyping approach a quick win is the most appropriate.
  3. Where the required solution is a robust error-free system, when time-to-market and new features and functionality are of less importance than reliability, then closer integration with existing legacy systems may be possible
  4. Where the required solution to develop a system to anticipate future developments as far as possible and to allow for easy integration and minimum maintenance when new developments are introduced, a core system that can support future modules is likely to be the most desirable approach.
  5. Where time-to-market is less critical and the integrity of the system and approach is paramount, the cautious approach to developing a robust system has clear advantages. However, the danger of this approach is a constant state of Research and Development that never actually goes into production.
  6. Where financial considerations enable today's technologies to be applied quickly for maximum business benefit, an approach that allows each solution to be discarded once it has past its 1) sell-by or 2) business-benefit date and replaced by the next new solution may be the most commercially appropriate solution.
  7. a) Easy integration of new features and functionality b) Low Maintenance

Customer Experience Strategy
Cautious Quick Win Strategies

In summary

At all times, it is important to constantly monitor marketplace trends to ensure that you do not adhere to a particular route or technology approach in spite of a change in marketplace direction.
You should maintain flexibility and adaptability at all times, but without causing paralysis through indecision or uncertainty.
The next lesson wraps up this module.

Changing Business using Top Down Strategy - Exercise

Before you move on to the final lesson, click the Exercise link below to try a Problem Solver on scaling the business.
Changing Business using Top Down Strategy - Exercise
[1]Value-chain: A value chain identifies activities, functions and business processes that are involved in the design, marketing, delivering and supporting of a product or service in an enterprise.