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Amazon (Business Strategy)
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DescriptionThe Report discusses how successful Amazon's strategy for the external environment. Critical Success Factors for Developing an e-Business Strategy.
Critical Success Factors for Developing an e-Business Strategy
e-Business is the new, leading edge of electronic commerce. Organizations are using e-business
applications such as enterprise resource planning, customer relationship management and e-procurement
to transform traditional businesses into e-businesses. As organizations pursue an e-business strategy what
are the five or six most important factors to consider? What are the opportunities? What are the threats?
Answering these questions is the primary purpose of this paper. First, e-business is defined and placed in
an historical context with its evolution through the electronic commerce concept. Then six critical success
factors for developing e-business strategy are discussed and mini-case studies are used to illustrate their
application in real businesses.
What is e-Business?
In the beginning there was EDI. Electronic data interchange – electronic transmission of commercial
information between two trading partners – was the original e-commerce application However, EDI was
technologically primitive, required complex standards to implement and was limited to organizations with
In the mid-1990's, electronic commerce emerged as a term that was EDI as well as open buying and
selling on electronic networks. For example, the Computer Desktop Encyclopedia (1995) defined
electronic commerce as "Doing business on-line. It includes purchasing products via on-line services and
the Internet as well as electronic data interchange (EDI), in which one company's computer queries and
transmits purchase orders to another company's computer." Similarly, a short definition of electronic
commerce that was widely used at this time was "The buying and selling of information, products and
services via computer networks" (Kalakota and Whinston, 1996, p. 1).
In a 1997 marketing campaign IBM introduced the term e-business as "how network technologies can be
used to transform key business processes conducted both within an organization, and externally with its
customers, partners, stakeholders and suppliers. An element of e-business is e-commerce, which IBM
defines more narrowly, as commercial transactions over the Internet only" (Wagstaff, 1997).
Some authors have adopted this perspective. For example, "e-business, in addition to encompassing ecommerce,
includes both front- and back-office applications that form the engine for modern business . . .
. e-Business is the overall strategy, and e-commerce is an extremely important facet of e-business"
(Kalakota and Robinson, 1999, p. 4). Similarly:
The term electronic commerce is restricting, however, and does not fully encompass the true
nature of the many types of information exchanges occurring via telecommunication
devices. The term electronic business also includes the exchange of information not related
to the actual buying and selling of goods. Increasingly businesses are using electronic
mechanisms to distribute information and provide customer support. These activities are not
"commerce" activities; they are "business" activities. Thus the term electronic business is
broader and may eventually replace the term electronic commerce. (Greenstein and
Feinman, 1999, p. 2)
Others reject this separation of the concepts. Years before IBM promoted ...
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