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266 Part 2 Strategy and applications

Through considering alternative strategy process models such as those of Table 5.1, common
elements are apparent:
1 Internal and external environment scanning or analysis is needed. Scanning occurs both
during strategy development and as a continuous process in order to respond to competi-
tors.
2 A clear statement of vision and objectives is required. Clarity is required to communicate
the strategic intention to both employees and the marketplace. Objectives are also vital to
act as a check as to whether the strategy is successful!
3 Strategy development can be broken down into strategy option generation, evaluation and
selection. An effective strategy will usually be based on reviewing a range of alternatives
and selecting the best on its merits.
4 After strategy development, enactment of the strategy occurs as strategy implementation.
5 Control is required to monitor operational and strategy effectiveness problems and adjust
the operations or strategy accordingly.
Additionally, the models suggest that these elements, although generally sequential, are also
iterative and require reference back to previous stages. In reality there is overlap between
these stages.
To what extent, then, can this traditional strategy approach be applied to e-business? We
will now review some suggestions for how e-business strategy should be approached.
Hackbarth and Kettinger (2000) suggest a four-stage ‘strategic e-breakout’ model with
stages of:
1 Initiation
2 Diagnosis of the industry environment
3 Breakout to establish a strategic target
4 Transition or plotting a migration path.
This model emphasizes the need to innovate away from traditional strategic approaches by
using the term ‘breakout’ to show the need for new marketplace structures and business/rev-
enue models (Chapter 2). A weakness of this approach is that it does not emphasize objective
setting and control. However, Hackbarth and Kettinger’s paper is valuable in detailing spe-
cific e-business strategy development activities. For example, the authors suggest that
company analysis and diagnosis should review the firm’s capabilities with respect to the cus-
tomers, suppliers, business partnerships and technologies.
Deise et al. (2000) present a novel approach to developing e-business strategy. Their
approach is based on work conducted for clients of management consultants Pricewater-

houseCoopers. They suggest that the focus of e-business strategy will vary according to the
evolutionary stage of e-business. Initially the focus will involve the enhancement of the sell-
ing channels (sell-side e-commerce), which then tends to be followed by value-chain
integration (buy-side e-commerce), and creation of a value network.
Jelassi and Enders (2008) suggest that there are three key dimensions for defining
e-business strategy:
1 Where will the organization compete? (That is, within the external micro-environment.)
2 What type of value will it create? (Strategy options to generate value through increased
revenue or reduced costs with their primary choices of (1) a cost leadership position where
a company competes primarily in terms of low prices and (2) a differentiated position
where a company competes on the basis of superior products and services.)
3 How should the organization be designed to deliver value? Includes internal structure and
resources and interfaces with external companies.
Note the use of two-way arrows in Figure 5.4 to indicate that each stage is not discrete, but
rather it involves referring backwards or forwards to other strategy elements. Each strategy ele-
ment will have several iterations. The arrows in Figure 5.4 highlight an important distinction in