E-business Communities

To create the future, a company must be capable of engineering the entire end-to-end value stream, which is not a radically new concept. Experienced managers know to redefine business designs and processes when implementing new forms of value. What’s different in this new environment is the widespread use of synergistic clusters, business ecosystems, coalitions, cooperative networks, or outsourcing t create end-to-end value streams. E-Business communities (EBCs), as these networks of relationships are known, link businesses, customers, and suppliers to create a unique business organism. This trend to the seventh rule of e-business:

The business design of the future increasingly uses reconfigurable e-business community models to best meet customers’ need

For instance, Amazon.com, Microsoft CarPoint, E*TRADE, and other e-commerce startups are essentially complex EBCs built for the sole purpose of organizing and energizing cross-enterprise relationships to create end-to-end value for the customer. Competition is no longer between companies, but between EBCs.

EBC strategies see companies as part of an extended business family that pools the resources and benefits of each company’s expertise. An EBC can play a powerful role in attacking market leaders, and new entrants are using them to gain access to resources, customers, technology, and products. However, EBCs are not just restricted to e-commerce startups. They are everywhere. Large established companies are also moving to the EBC model, but at a slower pace. Why? EBCs are difficult to integrate, and coordination among partners can prove troublesome. Large companies are therefore taking a more incremental approach to EBCs by first concentrating on creating flexible supplier communities vis-a-vis supply chain management.