Electronic Commerce Business Models by Peter Weill and Michael Vitale. Harvard Business School Press, Forthcoming, 2000.
Business models for electronic commerce are being developed organically by pioneering firms doing business electronically today. From this process, some radical new business models are emerging, including information broker, electronic auction, virtual community and portal. At the same time, some traditional business models, such as direct consumer connection and full service relationship, are undergoing radical change, taking advantage of the newly ubiquitous electronic infrastructures. New business models for electronic commerce pose a significant challenge to existing businesses, no matter how successful they may have been in the past. Existing businesses must not only manage their current physical business models and customer and supplier channels, but must also contend with agile new electronic competitors with little expensive physical infrastructures to support. We have developed an innovative way to represent business models using a simple charting technique. For each of the business model there is a schematic illustrating the major players (e.g. the organization engaged in electronic commerce, its customers, consumers, intermediaries, and suppliers), and the flows of funds, products, and information. This charting technique can be used to build and test new and tailored business model for a firm.