From e-Business Strategies for Virtual Organizations

where we knock down the walls that separate us from each other on the inside, and from our key constituencies on the outside.
(Jack Welch, CEO, GE)

5.1 Introduction

Driven by such phenomena as the World Wide Web, mass customization, compressed product life cycles, new distribution channels and new forms of integrated organizations, the most fundamental elements of doing business are changing and a totally new business environment is emerging. This environment variously described as the electronic business community (EBC), electronic economy, electronic market, electronic marketplace or marketspace and the virtual market is characterized by rapid exchange of information within a virtual network of customers and suppliers working together to create value added processes. The virtual market (Figure 5.1) brings with it new forms of IT-enabled intermediation, virtual supply chains, increasing knowledge intensity and information-based business architecture strategies. This new business paradigm goes beyond e-business and can be described more effectively as i-business where core business processes may need to be rethought and redesigned, new organizational forms and interorganizational forms may need to be developed and where the emphasis will be on collaboration rather than competition within the virtual market.

Figure 5.1: Virtual market

i-business is defined as a business with the following core elements:

  • internetworked market;

  • internet-enabled supply chain;

  • interorganizational systems;

  • integrated organizational systems;

  • intelligent knowledge-based decision systems;

  • information-based business architecture strategy.

The first three of these concepts are explored in depth and we return to the other three components later in Chapters 7, 8 and 9.


Products & Services
Business Consulting Services
Business consulting services include high-level business endeavors such as strategic planning, market positioning consulting, business plan development, enterprise architecture, and information infrastructure planning and development.
Online Communities
Online communities consist of users with similar interests and requirements who communicate electronically to discuss ideas and ask or answer questions.
Application Service Providers
Application service providers (ASP) or software as a service providers (SaaS) are companies that provide software or other computer-based services over the Internet from a data center. ASP is sometimes known as software on demand.
Engineering Consulting Services
Engineering consulting firms provide engineering services and expertise to companies in need of a specialized skill-set.  Professionals in this category work with clients to define solutions to problems or to help determine and recommend the best course of action for a given initiative.
Legal Software
Legal Software is software used in the legal profession to automate processes, to create forms, to access court databases and other related applications.

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