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Choosing the Appropriate Strategy for the Internal Organization of e-Business Activities

  • Tawfik JelassiEmail author
  • Francisco J. Martínez-López
Chapter
  • 91 Downloads
Part of the Classroom Companion: Business book series (CCB)

Abstract

Firstly, this chapter analyzed the degree of integration of individual activities of the value chain. More specifically, it discussed which activities a business should perform (or “make”) by itself and which activities it should source (or “buy”) from external providers. Secondly, the chapter analyzed how to choose the organizational structure for e-business activities and presented the following four options: (1) in-house integration, (2) joint venture, (3) strategic partnership, and (4) independent business (e.g., a spin-off). It then discussed the benefits and drawbacks of each organizational option. Finally, the chapter analyzed the unbundling of the traditional organization as a result of falling transaction costs made possible by the Internet.

Keywords

Make-or-buy Value chain deconstruction Unbundling the corporation Business process re-engineering 

References

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Further Reading

  1. W. Aghina, A. De Smet, G. Lackey, M. Lurie, and M. Murarka, ‘The five trademarks of agile organizations’, McKinsey.com, January 2018.
  2. R. Coase wrote the first influential article on transaction cost theory in ‘The nature of the firm’, Economica, vol. 4, 1937, pp. 386–405. O. E. Williamson provided an additional foundational perspective on this topic in Markets and Hierarchies: Analysis and Antitrust Implications, Free Press, 1975. Also see: O.E. Williamson, ‘Comparative economic organization: The analysis of discrete structural alternatives’, Administrative Science Quarterly, vol. 36 (2), 1991, pp. 269–296.Google Scholar
  3. P. Evans and T. Wurster developed the concept of deconstructing the value chain in Blown to Bits, Harvard Business School Press, 1999. For a condensed version of this concept, see, by the same authors, ‘Strategy and the new economics of information’, Harvard Business Review, September–October, 1997, pp. 71–81.Google Scholar
  4. J. Hagel and M. Singer wrote the article ‘Unbundling the corporation’, Harvard Business Review, March–April, 1999, pp. 133–141.Google Scholar
  5. M. Porter criticises the deconstruction and unbundling concepts in ‘Strategy and the Internet’, Harvard Business Review, March, 2001, pp. 72–74.Google Scholar
  6. B. Rosenbloom reflects on several challenges that industrial firms face with their multi-channel marketing strategies. This includes the management of the emergence of eventual conflicts between the different channels, in ‘multi-channel strategy in business-to-business markets: Prospects and problems’, Industrial Marketing Management, vol. 36, 2007, pp. 4–9.Google Scholar
  7. A.A. Tsay and N. Agrawal, analyse the topic of conflict and e-commerce channels in ‘Channel conflict and coordination in the e-commerce age’, Production and Operations Management, vol. 13 (1), 2004, pp. 93–110.Google Scholar

Copyright information

© Springer Nature Switzerland AG 2020

Authors and Affiliations

  • Tawfik Jelassi
    • 1
    Email author
  • Francisco J. Martínez-López
    • 2
  1. 1.IMDLausanneSwitzerland
  2. 2.Department of Business Administration 1University of GranadaGranadaSpain

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