P.1David Feeny, Winter issue of MIT Sloan Management Review, 2001 Making Business Sense of the...

P.1David Feeny, Winter issue of MIT Sloan Management Review, 2001

Making Business Sense of the E-Opportunity

David Feeny, Winter issue of MIT Sloan Management Review, 2001 (p41-51).

第五組楊增祥 / 蔡承洲 / 楊麗芬 / 陳正國

吳美君 / 王渝樑


New Web Technologies

are offering companies unprecedented opportunities to

rethink

strategic business models,

processes, and

relationships

offers connectivity at low cost with simple user interface

A Strategic Framework to examine e-Commerce Opportunities

along the whole length of supply chain


e-Operations:

Automate administrative processesRe-engineer supply chainsImprove competitive procurementCollaborate & share between silos

e-Marketing:

Enhance selling processEnhance customer’s buying experienceEnhance customer’s usage experience

e-Service:

Understand customer Needs Provide customer serviceProvide customer knowledge neededNegotiate customer requirementsConstruct wider customer choice

E-Service

E-Marketing

E-Operation

Web-based initiatives that improve existing product

Inbound logistics

OperationsOutbound logistics

Sales & Marketing

ServiceProfit

Margin

E-Opportunity Domains & Components


Shapes of E-Operation Opportunity E-Operation

1. Automate administrative processes

• Low cost administration of “necessary evils”

• Nimble business culture

2. Re-engineer business’ infrastructure by use of new technology’s ability

• Responsiveness to customer and market changes

• Low product’s unit cost

3. Increase parenting value by collaborate & share between silos

• Best practice to share learning with peers

• Copy smartly

4. Competitive procurement

• Electric buying, $1,000 saving per car from GM/Ford/Daimler Chrysler collaboration

5. Supply Chain Reconfiguration

• Enable Virtual Enterprise to radical improvement


E-Operation Opportunity Model

Information

Intensity

Information Dispersion

Info

rma

tion

Co

nte

nt

Ree

ng

inee

r B

usi

nes

s In

fras

tru

ctu

re

Increased Parenting Value

Supply Chain Reconfiguratio

n and Integration

Intensified Competiti

ve Procurement

High

High

High • High information content, like financial services, publishing and research-based pharmaceutical companies

• Infrastructure is central to competitive advantage

• Need to trace many components, like automotive and aerospace industry,

• Availability, quality and cost depends on the way supply chain managed

• Example, operation in multi-locations• High opportunity to increased parenting value with• Best practice to share learning with peers• Copy smartly (local to global)

across value chain

along the supply chain

E-Operation

Inbound logistics


Sales & Marketing

ServiceProfit

MarginInbound logistics


Sales & Marketing

ServiceProfit

Margin


Shapes of E-Marketing OpportunityE-Marketing

Make effective sales efforts through

• better product and market targeting or

• by expressing benefit of product successfully

Enhancing selling process

Marketing Idea Concept Example

Customer InputThe involvement of customers in our development process will lead to better new products.

Ford has put its design studio online to obtain the feedback of selected customers.

Customer TargetingTracking customer status enables us to offer the relevant product. At the relevant product. At the relevant time.

Amazon notifies customers of new book-buying options based on a profile of previous purchases.

Customer AggregationWe have a new ability to reach and serve economically a dispersed customer segment.

eHobbies uses the internet as a channel to reach model-train enthusiasts around the world.

Benefit SellingWe can improve the way we illustrate to the customer the benefits our product provides.

Timex provides a downloadable simulation of its novel i-Control watch-setting system.

Achievement SellingLoyalty is strengthened when we show customers our track record of meeting commitments.

W.W. Grainger tracks and documents savings made by its corporate customers for maintenance supplies.



Provide support service that make

• easier to buy or

• better match to customer’s needs

Enhancing customer’s buying experience


Solutions-Specifier Proposition

We advise the customer on the types of products required to meet their needs.

Home Depot provides customers with everything they will need to carry out a do-it-yourself project.

One-Stop Shopping Proposition

Through links with providers of complementary products we meet more of the customer’s needs.

Office Depot links to sites such as stamps.com, TelePost to increase its coverage of overall customer needs.

System-Design Proposition

Our facilities enable the customer to design the overall system to which our products contribute.

Herman Miller’s “room planner” enables design of new furniture for existing office layouts.

Fastest-Source Proposition

We offer the customer the best chance of getting what they want quickly. With minimum hassle.

The core of Amazon.com’s book-buying proposition and many other internet offerings.

Tailored-Product Proposition

We rapidly deliver to the customer’s individual product specification.

Chipshot.com allows expert golfers to configure clubs to their own preferred specification.



Provide support service to

• Increase customer satisfaction over life cycle of product use

Enhancing customer’s usage experience


Added Service Proposition

As well as providing product. We help improve some aspect of the customer’s operational activity.

Lonely Planet publications provides an online “travel vault” for storage of travelers’ critical information.

Tailored Support Proposition

The support services for our products are tailored to reflect the customer’s needs and practices.

A Dell corporate customer has a “Premier Page “ online for employees to access the agreed level of support.


E-Marketing Opportunity ModelE-Marketing

High Frequency of Purchasing

Low Frequency of Purchasing

LowPerceivedProduct

Differentiation

HighPerceivedProduct

Differentiation

• Achievement Selling

• Benefit Selling• Customer Aggregation• Customer Targeting• Customer Input

• Fastest Source• Tailored Support• Added Service• One Stop Shopping

• Product Specifies• Tailored Product• System Design• Solution Specifies

• Prevent customer taking benefit for granted

Enhancing selling process

Possibly, operate in more than one quadrant

Enhancing customer’s buying experience

Enhancing customer’s buying experience & usage experience

• Help inexperienced buyer to refine choice

Reinforce customer’s choice

• Increase information availability


Shapes of E-Service Opportunity

• Starts with full understanding of customer’s needs

Give customers advice on their specific needs

• Baxter Renal example

• Provision of disposal bags for kidney dialysis -> expertise source in managing patent’s lives around treatment needs

• Require authoritative knowledge

Provide product and service knowledge to contribute target market

• Chemdex example

• Comprehensive knowledge provider in bioscience arena as credible investment-advice-provider

• An e-service business can bring above two components together in real time to customer with their best choice

• Priceline.Com example

• Achieve lower prices by virtually aggregating volume purchase

E-Service


Identifying E-Service Opportunity E-Service

E-Service Opportunity Model

Distribution

Repair

Availability

Payment

Delivery

Acceptance

Installation

PerformanceUpgrade

Return

Evaluation

Requirement

Specification

Customer Service Life Cycle

Who stocks it?

Who’s got it?

Credit OK?

Want it Now!

All there?

All mine!

How’s it going?

Need some more?

Time for service?

Finished!

Was it worth it?

Need it?

That’s the one!

Defect in any point of existing cycle is the opportunity for an E-Service business

Chemdex


Sustainability of E-Opportunity initiatives

1. Generic Lead Time Time to be copy by competitors

• Longer learning time (years) in e-operation initiatives

• Example: ERP introduction

2. Asymmetry Barriers Reduce competitor’s advantage if copy directly

(role of assets, location and existing IP)

• Example: Dell vs. Compaq in Direct business,

• Compaq not designed its product for mass customization with different supply chain structure

3. Preemption Barriers First mover advantage, customer aggregation in communities

• Customer stays with first-mover company unless competitor doing better

Competitive Advantage

sustainability Preemptive

BarriersAsymmetry

Barriers

GenericLead Time


It’s a Strategic Decision

Require Organization-Wide awareness/ readiness/ action

Need to Recognize/ Seize new opportunities

Require Re-engineering of the Value Chain

E-Opportunities?

E-Service

E-Marketing

E-Operation

The key is the frameworks used in following two approaches : • BPR, mainly back office:

o Cost reduction and o Operational efficiency via new technologies (ERP, workflow, EDI....) o with focus on major business processes (order filling, payment, inventory control,

HR......)

• e-Commerce, forward focus:o Enhanced selling: (gathering customer / market inputs,

building customer profiles, aggregation, cross and up-selling)o Enhanced buying: (convenience, personalization,

speed, matching needs, reducing transaction costs)o Enhanced customer experience (improve / speed delivery, help customers through

timely information provision, put customers in contact with customers)


E-Service

E-Marketing

E-Operation

Web-based initiatives that improve existing product

Examples

of E-Opportunities


Example: e-Service 1/2/3/4

Internet Banking

2005 年第六屆金手指獎網站類最佳企業獎 & 最佳線上顧客服務花旗網路銀行以客戶為中心 , 透過「網路」、「電話客服中心」與「年度大型客戶滿意度調查」，建立起實體與虛擬結合且暢通不間斷的客戶調查系統，構成獨有的 VOC （ voice of customer ）流程，快速地回應每一個客戶的聲音，轉換成持續改善的動力與創新的實質服務。

E-Service



Online-bill-Payment

花旗網路銀行於 2003 年 8 月推出的電子帳單繳款服務平台 -- 「花旗即時查即時繳」，整合了行動電話、電信業務、交通監理業務、公共事業、保險、會員費、及慈善機構捐款等多種費用，提供持卡人即時的個人日常帳單查詢與繳款服務，持卡人可以在任何時間、任何地點輕鬆繳納帳單，並享受信用卡延遲繳款及累積紅利的優惠，便利無窮。

E-Service



e-Statement 電子月結單隨時隨地上網查詢，全面掌握自己的財務狀況

即時查詢、列印三個月內的月結單，更有效率地整理與存檔月結單

透過個人密碼網路登入查詢，資訊安全有保障

結帳日後一天即時送達，不需再苦苦等候保護您我的地球，就從無紙帳單開始

E-Service



當您定期存款到期前七天內提醒您定期存款到期前提醒

當您優利組合帳戶到期前七天內提醒您優利組合帳戶到期前提醒花旗銀行

當您的信用卡/Ready Cash卡已開卡成功時通知您 (Batch run)

開卡成功通知

當您尚未繳交信用卡/Ready Cash卡帳單款項時提醒您。此提醒通知於帳單繳款截止日後一日發出。 (Batch run)

帳單已到期提醒

當您已繳交信用卡/Ready Cash卡帳單款項時通知您(Batch run)

繳款成功確認

當您信用卡/Ready Cash卡消費已達或超過信用額度80%時，於每月帳單日提醒您

已使用額度提醒花旗信用卡/Ready Cash卡

訊息通知說明訊息通知項目訊息通知類別

當您定期存款到期前七天內提醒您定期存款到期前提醒

當您優利組合帳戶到期前七天內提醒您優利組合帳戶到期前提醒花旗銀行

當您的信用卡/Ready Cash卡已開卡成功時通知您 (Batch run)

開卡成功通知

當您尚未繳交信用卡/Ready Cash卡帳單款項時提醒您。此提醒通知於帳單繳款截止日後一日發出。 (Batch run)

帳單已到期提醒

當您已繳交信用卡/Ready Cash卡帳單款項時通知您(Batch run)

繳款成功確認

當您信用卡/Ready Cash卡消費已達或超過信用額度80%時，於每月帳單日提醒您

已使用額度提醒花旗信用卡/Ready Cash卡

訊息通知說明訊息通知項目訊息通知類別

e-Alert

E-Service


e-Marketing 以公司需求區隔— Onvia.com

Onvia.com「小型企業的首席電子市場空間」

Onvia.com 針對小型企業所設計，用來提供其經營時所需的所有資源

同時， Onvia.com 提供賣方一個更迅速、更好的方式來吸收新客戶

Onvia.com 提供：–產品 : 超過 25,000 件商務用產品，從電腦硬體到一般紙張因應俱全

–服務 : 小型企業在經營時所須的關鍵服務，包括網際網路連結、發薪制度、以及長期規劃

–新知與建議 :每小時更新新經濟中的相關資訊

許多企業都將焦點放在小型公司上，提供相關的服務和產品，包括 : AllBusiness.com, bCentral.com, Business.com, BuyerZone.com, KillerBiz.com, Bizbuyer.com, Works.com

Onvia.com「小型企業的首席電子市場空間」

Onvia.com 針對小型企業所設計，用來提供其經營時所需的所有資源

同時， Onvia.com 提供賣方一個更迅速、更好的方式來吸收新客戶

Onvia.com 提供：–產品 : 超過 25,000 件商務用產品，從電腦硬體到一般紙張因應俱全

–服務 : 小型企業在經營時所須的關鍵服務，包括網際網路連結、發薪制度、以及長期規劃

–新知與建議 :每小時更新新經濟中的相關資訊

許多企業都將焦點放在小型公司上，提供相關的服務和產品，包括 : AllBusiness.com, bCentral.com, Business.com, BuyerZone.com, KillerBiz.com, Bizbuyer.com, Works.com

Source: Onvia.com site, Industry Standard, February 7, 2000

E-Marketing


e-Marketing 以區域區隔— Citysearch.com

Citysearch.com「在你的城市中該去哪、

做什麼」Citysearch.com是一個位於領先地位的地方交易公司，在美國幾個知名的都市提供服務，並緩慢地擴展到國際都市

Citysearch 提供 40 個城市完整的城市覽覽以及 33 個城市的藝術及娛樂導覽

Citysearch 提供：–電影清單–求職清單–旅館訂位–訂票–城市導覽

Citysearch.com「在你的城市中該去哪、

做什麼」Citysearch.com是一個位於領先地位的地方交易公司，在美國幾個知名的都市提供服務，並緩慢地擴展到國際都市

Citysearch 提供 40 個城市完整的城市覽覽以及 33 個城市的藝術及娛樂導覽

Citysearch 提供：–電影清單–求職清單–旅館訂位–訂票–城市導覽

E-Marketing


1.Supply-chain reconfiguration and integration---- Saturn of GM;

Build-to-order of Dell

2.Intensify competitive procurement

---- procurement of HP

3.Automating administrative process

---- Cisco

Example: e-Operation 1/2E-Operation


Example: e-Operation 1/2

4.Increased parenting value

---- BP Amoco

5.Re-engineering of primary infrastructure

---- financial services;

publishing

E-Operation

P.1David Feeny, Winter issue of MIT Sloan Management Review, 2001 Making Business Sense of the...

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