Info

Organisational structure

Circumstances

Advantages

Disadvantages

(a) No formal structure for e-commerce

Initial response to e-commerce or poor leadership with no identification of need for change

Can achieve rapid response to e-commerce

Poor-quality site in terms of content quality and customer service responses (e-mail, phone). Priorities not decided logically. Insufficient resources

(b) A separate committee or department manages and coordinates e-commerce

Identification of problem and response in (a)

Coordination and budgeting and resource allocation possible

May be difficult to get different departments to deliver their input because of other commitments

(c) A separate business unit with independent budgets

Internet contribution (Chapter 6) is sizeable (>20%)

As for (b), but can set own targets and not be constrained by resources. Lower-risk option than (d)

Has to respond to corporate strategy. Conflict of interests between department and traditional business

(d) A separate operating company

Major revenue potential or flotation. Need to differentiate from parent

As for (c), but can set strategy independently. Can maximise market potential

High risk if market potential is overestimated due to start-up costs

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