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Chapter 1 Introduction to e-business and e-commerce 29

Suppliers – government departments have a vast network of suppliers. The potential bene-
fits (and pitfalls) of electronic supply chain management and e-procurement described in
Chapters 6 and 7 are equally valid for government.
Internal communications – this includes information collection and dissemination and
e-mail and workflow systems for improving efficiency within government departments.
E-government is now viewed as important within government in many countries. The Euro-
pean Union has set up ‘i2010’ (European Information society in 2010) whose aims include

providing an integrated approach to information society and audio-visual policies in the
EU, covering regulation, research, and deployment and promoting cultural diversity.
(eEurope, 2005)

E-business opportunities

E-business has introduced new opportunities for small and large organizations to compete
in the global marketplace. Many commentators have noted that one of the biggest changes
introduced by electronic communications is how approaches to transmitting and trans-
forming information can be used for competitive advantage. A significant commentary on
the disruptive, transformational nature of electronic communications is provided in Box 1.2.

Box 1.2 Evans and Wurster on the impact of disruptive Internet technologies

Disruptive Internet Evans and Wurster of Harvard argue in their classic 1997 paper ‘Strategy and the new
technologies economics of information’ that there are three characteristics of information which,
New Internet-based
communications when combined with disruptive Internet technologies, can have a major impact on
approaches which a marketplace. These characteristics of information are reach, richness and affiliation:
change the way in which
information about 1 Reach. Conventionally, ‘reach’ refers to the potential number of customers a busi-
products is exchanged,
which impact the basis ness can interact with. The Internet enables reach to be increased nationally and
for competition in a internationally at low cost through making content available via search engines.
marketplace. ‘Reach’ also refers to the number of different categories and products a consumer
interface (e.g. store, catalogue or web site) can cover: witness the large range of

products available through e-businesses such as Amazon, eBay and Kelkoo.com
and existing companies such as easyJet.com and Tesco.com which have used the
web to extend their product range.
2 Richness. This is a characteristic of the information itself. The Internet enables more
detailed information about products, prices and availability to be made available. It
also enables more interactivity and customization to engage customers and to provide
more up-to-date information. But, Evans and Wurster also note that richness is limited
by bandwidth (the volume of information that can be transmitted using a communi-
cations link in a given time), the accuracy or reliability of information and its security.
3 Affiliation. This refers to the effectiveness of links with partners. In an online context,
an organization which has the most and richest links with other compatible organ-
izations will be able to gain a larger reach and influence. Consider how e-businesses
such as eBay, Google and Yahoo! have successfully formed partnerships or
acquired other companies to provide new diverse information services such as
social networking, mapping, voice communications and online photography, to
name just a few.