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256 Part 2 Strategy and applications

Introduction

Developing an e-business strategy requires a fusion of existing approaches to business, mar-
keting, supply chain management and information systems strategy development. In
addition to traditional strategy approaches, commentators have exhorted companies to
apply innovative techniques to achieve competitive advantage. Around the start of the new
millennium, many articles, fuelled by the dot-com hype of the time, urged CEOs to ‘inno-
vate or die’. For many existing companies this was neither desirable nor necessary and they
have made a more gradual approach to e-business practice. Those companies that have suc-
cessfully managed the transformation to e-business such as Cisco, Dell, General Motors,
HSBC and IBM, and, in Europe, easyJet and British Telecom, have done so by applying tra-
ditional strategy approaches. At the same time there have been many start-ups featured as
cases in previous chapters such as eBay, Lastminute.com and Zopa.com that have succeeded
through innovative business models. But these companies also have succeeded through
applying established principles of business strategy, planning and risk management.
In this chapter we seek to show how an e-business strategy can be created through follow-
ing these established principles, but also through careful consideration of how to best
identify and exploit the differences introduced by new electronic channels. In a nutshell,
e-business isn’t just about defining ‘how to do business online’, it defines ‘how to do business
differently online’. The e-business strategy defines how.
We start the chapter by introducing e-business strategy and then discuss appropriate
strategy process model to follow as a framework for developing e-business strategy. The
chapter is structured around this four-stage strategy process model:
1 Strategic evaluation.
2 Strategic objectives.
3 Strategy definition.
4 Strategy implementation.
For each of these components of strategy, management actions are reviewed with the
emphasis on development of e-business strategy.

Real-world E-Business experiences The Econsultancy interview

Standard Life’s Sharon Shaw on strategy and planning

Overview and main concepts covered

Developing a new e-commerce strategy can be a daunting experience, especially
considering the lack of case studies and benchmarks available. We spoke to Sharon
Shaw, e-commerce manager at Standard Life, and agency Avenue A/Razorfish’s
Adrian Gans about their experiences of strategy creation, including budgets, KPIs,
incentives and structures.
Q. When developing a new digital strategy, how do you start? What models are
out there for you to base it on? We have developed a wheel framework for
acquisition, conversion and retention, but what approach did you use?
Sharon Shaw, Standard Life: Standard Life and Avenue A/Razorfish have used an
Attract, Convert, Support, Extend model, which is very similar to the E-consultancy
framework, though its meaning is evolving as the role of digital changes within the
organisation. Measurement and optimisation are fundamentals in both.