The e-Commerce Phenomenon:

Jenny Cobb, Manager Strategic Special Projects

Vanderbilt University jenny.cobb@vanderbilt.edu

Where Does Higher Education Fit?

CUMREC 2000

The e-business landscape

Some critical assumptions anddrivers for higher education

What is e-Business?

e-Business is a shorthand way of describing the integration of business strategies, processes and technologies

“e-Business applications are those that enable and manage relationships between an enterprise, its functions and processes and those of its customer, suppliers, value chain, community or industry. These applications many not, themselves, be enterprisewide but are aimed at optimizing external relationships.” Source: Gartner Group

e-Business Components e-Business encompasses

E-commerce (EC): Business to Business (B2B), Business to Consumer (B2C), Business to Education (B2E)

Customer Relationship Management (CRM) Supply Chain Management (SCM) Supply Chain

Planning (SCP) Business Intelligence (BI) Knowledge Management (KM) Collaboration Technologies (CT) Available to Promise (ATP) more...

e-Business=EC+CRM+SCM+BI+KM+CT

Administration and

operations

Legally defined

Enterprise

Marketing, sales and,

service

Product and services

creation

Logistics and

fulfillment

Industry workersSuppliers

BusinessPartners

Distributionchannels

Supply Chain

“VirtualPartners”

informal information sharing deals

Potentialcustomers / influencers

Potentialcompetitors

BI, KM, andCT for

externalinformation

Customers

Product and services

creation

Supply Chain Management Customer Relationship Management

Web Commerce Front OfficeElectronic Commerce Back Office

Source: Gartner Group

Customer Relationship Management

CRM is the core activity of e-business Emphasis on personalization

User profiles: explicit and implicit profiling Collaborative filtering Rules-based personalization

Provide a seamless customer experience to encourage customer retention and loyalty

Source of tailoring site presentation, one-to-one marketing and merchandising

What are the drivers for Higher Ed?

Growth of Technology

1996 - 1999Presence

Features-Marketing information-Brochures

1997 - 2000Interaction

Additional Features:-Intranet aps-Interactivity-Personalization-Basic Search-Linked Sites

1998 - 2003Transaction

AdditionalFeatures:-e-commerce-EDI supports-Communities-SCP apps-ERP front end-Customer self-service

2000 - 2005Transformation

Additional Features:

-SC optimization-CRM apps-Common platform-Industry-specific app engines-Functional apps-Customer-Real-time ATP-Advanced personalization

Increasing Business

Value

Increasing Application Cost

Source: Gartner Group

$5M-$50M

$500K-$5M

$5K-$500K

e-Growth of Everything

0

1,000

2,000

3,000

The e-growth of ____________ over the next ___ years (fill in the blanks)

*Web users

*Connected Devices

*B2B Commerce

*Micro-markets in higher education

*Online courses

*Investment in the internet

*Distance Learners

*New e-businesses

*B2C Services and revenue

The e-Business Phenomenon

OK, OK…..

We get the message!

How do you go forward from here?

Requires a shift in thinking about what we do and how we do it

Taking an e-business view of the world and articulating what business we are in

Re-inventing some aspects of our institution’s fuctions

Identifying those areas that are core to meeting your institutions customers / markets

e-Business Strategic Thinking

e-Business is a strategy, not an application Strategic thinking is NOT the same thing as a

strategic plan A pre-cursor and provides guidance to the

Business Process Redesign (BPR) process An opportunity for education (what is possible)

and a reality check (what is feasible) A vehicle to address the cultural, political

and organizational readiness

Identify Mandates

What are the things the entity “must do” fullfil its core mission

This requires understanding what the true nature of the business is….

So what is the business of higher education?

Identify Mandates

“The biggest danger is that that higher education may be the next railroad industry, which built bigger and better railroads decade after decade because that’s the business it thought it was in. The reality was that it was in the transportation industry, and it was nearly put out of business by airplanes. Colleges and universities are not in the campus business, but the education business”

Arthur Levine, Columbia Teachers College

Identify Stakeholders

List the current and future stakeholders and describe why they are stakeholders

Think about “markets” as stakeholders life-long learners traditional 18 - 22 year old residential adult education corporate education/partnerships global opportunities dispersed faculty

Evaluate the External Environment

To identify opportunities and threats Identify current forces and emerging trends

political economic social technology

Clients, customers and payers Competitors Collaborators

Forces and Trends

Economic landscape less qualified high school graduates in the future shrinking research dollars more competition for alumni giving change in customer needs - demand for

distance education

Return on investment new revenue streams are possible corporate alliances / consortia value of new web-enabled services

Clients, Customers and Payers

New service and products expectations Services tailored to customer profile

alumni students faculty and staff community prospective students

Making the products you already sell more accessible

Changing customer demand

Education Delivery Models

“just-in-case” education, in which we expect students to complete a degree program long before they need knowledge

“just-in-time” educations, which education is sought by a person when they need it through non-degree programs

“just-for-you” education in which programs are carefully tailored for to meet the specific life-long learing requirements of particular students.

Competitors and Collaborators

Aggressive higher education marketplace the challenge of maintaining market share for-profit institutions and virtual universities

threaten the college and university monopoly on education

virtual competition is unencumbered by tradition bricks and mortar

some partners will be competitors and collaborators

evaluation of ASP and BSP

Evaluate Internal Evironment

Resources people data economic competencies

Present strategy (overall and by function) Performance (results, history)

Strategic Issues Emerge

Develop a description of the organization in the future

Create a vision of success Use the “Success Scenario” as a guiding

principle for the detailed business process redesign work

Identify practical alternatives, barriers, major proposals, actions, work program

Management Issues

Establishing executive advocacy and understanding

e-business: a technical environment, an application, a process, and a culture

Ownership, accountability, and communication New funding models to grow e-business The business of higher education: wholistic

view of the academy and administration

Management Issues

New staffing models and central IT Internal audit requirements Security for ubiquitous computing Optimizing customer relationships

Who is the customer? What relationship(s) add value?

Looking for the competitive advantage of e-business in the context of your institution

Challenge in the Short Term

Begin thinking like an e-business As you move forward with “traditional projects”

incoporate an e-business view of the world Reflect on our organizations from an e-business

point of view value-chain core functions

Just when you thought it was safe...

e-Education is emerging as a recognized application of

e-business strategies

What is e-Business e-Education?

e-Business e-Education is a shorthand way of describing the integration of business strategies, processes and technologies

“e-Business e-Education applications are those that enable and manage relationships between an enterprise, its functions and processes and those of its customer, suppliers, value chain, community or industry. These applications many not, themselves, be enterprisewide but are aimed at optimizing external relationships.” Source: Cobb with help from Gartner Group

What are the e-Education Drivers

Education is now an economic issue - the knowledge / learning society

Customer needs and demands for different delivery models

Education delivery no longer constrained by the limitations of brinks and mortar institutions

The potential ROI Access to investment capital

e-Education

“The next big killer application for the Internet is going to be education. Education over the Internet is going to be so big it is going to make e-mail usage look like a rounding error”

John Chambers, CEO of Cisco Systems Inc.,

Long Term Challenges

Becoming an e-business versus doing e-business

Transforming education though IT will require new business models

New business models will transform the “organization” no longer a single entity an extended network core functions, market-

focused business units, shared support units customers, suppliers, collaborators, BSPs

What is an e-Organization Look?

The transformation to an e-org is taking place along seven key dimensions Organizational structure Leadership People & Culture Coherence Knowledge Alliances Governance

e-Org Dimensions

Organization Structure Hierachical Command-and-control

Leadership Selected “stars” step

above Leaders set agendas Leaders force change

Organization Structure Centerless, networked Flexible structure that

is easily modified

Leadership Everyone is a leader Leaders create

environment for success

Leaders create capacity for change

1990’s e-Org

e-Org Dimensions

People & Culture Long term rewards Vertical decision-

making Individuals and small

teams rewarded

Coherence hard-wired into

processes Internal relevance

People & Culture “Own your own career”

mentality Delegated authority Collaboration expected

and rewarded

Coherance Embedded vision Impact projected

externally

1990’s e-Org

e-Org Dimensions

Knowledge Focused on internal

processes Individualistic

Alliances Compliment current

gaps Ally with distant

partners

Knowledge Focused on customers Institutional

Alliances Create new value and

outsource uncompetitive services

Ally with competitors, customers and suppliers

1990’s e-Org

e-Org Dimensions

Governance Internally focuse Top down

Governance Internal and external

focus Distributed

1990’s e-Org

Goal: flexible, nimble, decentralized,

team- and alliance-based organization

Challenge in the Short Term

Begin thinking like an e-business As you move forward with “traditional projects”

incoporate and e-business view of the world Reflect on our organizations from an e-business point

of view value-chain core functions

Begin to chart your path to an e-org orientation - starting at your back door

The e-Commerce Phenomenon:

Closing thoughts

Where Does Higher Education Fit?

Closing Thoughts

No one can buy an e-business package - not now anyway - because e-business is not simply about automating processes or implementing application software, or even about process integration or re-engineering.

The best way to think about e-business is that it is a shorthand method of describing what happens when enterprise management redefines its role in an industry and an economic environment.

Source: Gartner Group

e-BusinessA Window of Opportunity

The e-Commerce Phenomenon:

Where Does Higher Education Fit?