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276 Part 2 Strategy and applications

Table 5.4 Capability maturity model of the adoption of e-business

Carnegie Mellon Atos consulting e-business capability framework
Software development
maturity process

Level 1. Initial E-business unplanned. E-business initiatives are ad hoc, unplanned and even chaotic. The
organization lacks the capability to meet commitments consistently
Level 2. Repeatable E-business aware. Basic e-business processes established necessary to repeat earlier
successes but not yet part of planning process. The focus is on developing the
capabilities of the organization
Level 3. Defined E-business enabled. Central e-business strategy and planning process towards a
centralized model (IT and competencies)
Level 4. Managed E-business integrated. E-business part of departmental and business unit planning.
Detailed performance measures of e-business process and applications collected and
used for control
Level 5. Optimized Extended enterprise. E-business core part of corporate strategy with continuous
evaluation of e-business improvements enabled by quantitative feedback, piloting
innovative ideas and technologies

Competitive environment analysis

As well as assessing the suitability of the internal resources of an organization for the move
to e-business, external factors are also assessed as part of strategic analysis. We have already
considered how marketplace analysis can be undertaken to identify external opportunities
and threats for a business in Chapter 2, but here we consider demand analysis and look at
competitive threats in more detail.

Demand analysis
A key factor driving e-business strategy objectives is the current level and future projections
of customer, partner and internal access and usage of different types of e-commerce services,
Demand analysis demand analysis. This is one of the main external factors referenced by Perrott (2005). In
Assessment of the particular, demand analysis is a key activity in producing an e-marketing plan which will
demand for e-commerce
services amongst existing feed into the e-business strategy. It is described in more detail in Chapter 8.
and potential customer Further information on demand for services will be indicated by data on the volume of
segments.
searches as shown in Figure 2.12 for example.
For buy-side e-commerce a company also needs to consider the e-commerce services its
suppliers offer: how many offer services for e-commerce and where they are located (e.g.
direct with suppliers, in customer solutions or marketplaces – Chapter 7, p. 400).

Assessing competitive threats

Michael Porter’s classic 1980 model of the five main competitive forces that affect a com-
pany still provides a valid framework for reviewing threats arising in the e-business era. It is
instructive to assess how the Internet may change the competitive environment. Table 5.5
summarizes the impact of the Internet on the five competitive forces. This table is a sum-
mary of the analysis by Michael Porter of the impact of the Internet on business using the
five forces framework (Porter, 2001).