Competitive Advantage - Sustainable Competitive Advantage

Sustainable competitive advantage may be realised by adoption of e-commerce strategies and business models. Rather than simply exchanging procurement transactions as with e-commerce practices, leading enterprises are executing e- commerce to share intellectual capital with their trading partners working as a value chain that provides a competitive advantage for the development and distribution of their products.

The idea of giving the customer access to tracking information via the internet was a new one that had considerable appeal to the customer.

For example, the use of new system also had considerable advantage to FedEx who no longer had to deal with a vast number of calls checking up on progress of consignment; because the customer could now access the system themselves. But e-commerce development and implementation could not be entirely private- customer had to become involved at some stage. The competitor was quick to catch on to the idea and UPS (United Parsal Services) was soon able to make available a similar system built onto their internal IT infrastructure for tracking packages. DHL, on the other hand, were unable to react as quickly because of technical difficulties in implementing and integrating a competitive system.

To gain advantage:

System need to be out in the market before competitors make a start in copying ideas
Technical advantage is converted into brand advantage
Provide better and better services to the customer

Sustainable competitive advantage appears to be more common with internet e- commerce:

The element of surprises can be greater.
Entry cost is low
Regular development in the sites and services

Comments

E-Procurement Cycle

Figure 2.6 illustrates the different steps associated with the overall procurement cycle, from the order placement to the accounts payable, in steps through a web based e-commerce network. It includes customers' inventory and supplier information and is readily accessible at any time and from everywhere. E-procurement allows two-way communication of real-time financial and purchasing information. Management at both the buying and selling end can see what is happening at any given moment and identify trends and problems. A shorter purchasing cycle enables companies to maintain lower inventory levels and respond more quickly to stock-outs. Previous Next

Business Strategy - Strategic Planning Cycle

E-business competitive strategy is normally formed and implemented according to a planning cycle which is called strategic planning cycle . There are four stages in this planning cycle as shown in figure 1.19: Industry and Competitive Analysis It aims to identifying those factors on which the success of an electronic commerce project or business would depend. One way of doing that is to carry out SWOT analysis and study your business as well as the business of competitors. Analysis of online competitor businesses is relatively easy since they are just a few clicks away on the web. Strategy Formulation Based upen study of internal and external business environment and in light of a company's strengths and weaknesses, a competitive business strategy is formed. It may be a strategy of cost leadership, product differentiation or focus. One can also identify ways how information technology can be used to implement/enforce such strategy. The inputs to the strategy formulation process ar...

Disadvantages of EDI

1), Operating Procedures : Since EDI is a structured way of working, companies usually change operating procedures. 2) Production and Purchasing Decisions : Responsibilities may have to be changed during the introduction of EDI system. Unless this system and the links with other systems are managed well, it is not possible for the data processing department to become involved in production and purchasing decisions. 3) Transparent : Less transparent than paper-based systems. 4) Flexibility : Certain EDI systems are highly flexible, others are very simple to implement. 5) High Costs : Applications are costing to develop and operate; especially new entrants find this more difficult to have EDI. Many small companies are facing resources problems in getting starter with the initial implementation of EDI system. It is beyond the resources these companies to invest tens or hundreds of thousands of dollars in setting and implementation costs, as well as weeks of personne...

fivwords

Search This Blog