Overview

The first thing that most senior managers consider when they begin to think about how they might transition their companies into e-business is how such a change would alter their company's overall strategy. Given the key role of strategy in modern business, we'll begin by providing an overview of how the e-business revolution impacts corporate strategy.

The concept of a business strategy has been around for decades, and the models and process used to develop a company strategy are taught at every business school. Developing and updating a company's business strategy is one of the key responsibilities of a company's executive officers. A business strategy defines how a company is going to compete, what its goals will be, and what policies it will support to achieve those goals. Many managers refer to a company's strategy as the company's business model.

To develop a business strategy, senior executives need to consider the strengths and weaknesses of their own company and its competitors. They also need to consider trends, threats, and opportunities within the industry in which they compete, and within the broader social, political, technological, and economic environments in which the company lives.

There are different schools of business strategy. Some advocate a formal process that approaches the modeling process very systematically, while others propose less formal processes. A few argue that the world is changing so fast that companies must depend on the instincts of their senior executives in order to move rapidly. In effect, such companies evolve new...