Creating Virtual Alliances Through Value Chain Management: An Innovative Approach to eBusiness Strategy

Abstract

This chapter proposes a new approach to strategic planning for eBusiness systems which incorporates a three-stage investigation using value, supply and demand chain models. The resulting analysis can define the strategy and structure for an eBusiness enterprise as a value alliance network with a robust approach to evolutionary eBusiness development and the management of change. Initially an overview of the characteristics of virtual markets are presented and the opportunities for IT-enabled intermediation are examined. The chapter reviews the concepts of supply chain management (SCM), demand chains and value chains in the context of electronically networked organizations and then relates these to the evolution of a virtual value chain. The virtual value chain is used as a basis for the development of an effective organizational structure and the value alliance model in a virtual networked environment. Finally, this is reviewed in the context of the retail market and interactive home shopping systems (IAHS) and illustrated by a case study within the e-grocery business.