A Roadmap for Identifying IOS Opportunities

Built on the above framework characterizing IOS’s roles, a roadmap for systematically identifying IOS opportunities is suggested in this section. Figure 12.2 illustrates this roadmap.

To identify appropriate use of an IOS, first, the business purposes of why to use the IOS needs to

be addressed. Then, who will be connected through the IOS and what business activities will be

supported by the IOS need to be clarified. Upon recognition of business purposes, desired

partners, and supported activities of an IOS, how to use the IOS can be formulated. Appropriate

IOS technologies can then be evaluated and selected based on the three IOS measures (including IOS reach, range, and diversity of use) introduced earlier in this dissertation.

Why to use the IOS? (Business purposes)

To initiate a new action (in terms of action type)

To produce series of patterned actions (in terms of action frequency, heterogeneity, complexity) To in itiat e a new com petit ive actio n To p ro_du ce s er ies of pa tter ne d ac tio ns Who to link to through the IOS?

(IOS partners)

Customers Suppliers

(Financial) service providers external design partners logistics partners dealers competitors Exte_rna l de_sign par_tner s Logistics partners (Fina ncial ) serv ice pr ovide rs Supplier s Dealers Cus tom ers C om pe tito_rs

What business activities will the IOS support?

(Business activities)

Procurement Product development Production Logistics Marketing & sales Customer service

How to use the IOS? (Roles of IOS)

Roles of IOS:

Innovation (to apply IOS to new business settings, to use emerging technologies to

interfirm settings) Exploration (to establish new, significant relationships)

Exploitation (to develop

co-specialized business process, knowledge, and expertise)

Metrics for evaluating IOS candidate technologies:

IOS reach IOS range Diversity of IOS use

Logistics

Production

Produc t develo

pment

Marke_{ting &} sales Proc ureme nt Cus_tom er s_erv ice Exploration Innovati on Explo itation

Why to use the IOS? An IOS can be used for two generally purposes: (1) to initiate a new competitive move (e.g., a Web-based marketing campaign, or a Web/wireless-enabled tracking service), and (2) to produce series of patterned competitive actions (e.g., fast moves enabled by the use of shared repositories or electronic marketplaces, or heterogeneous moves generated by the innovations brought forth by using instant messaging in the interfirm settings or using RFID in manufacturing and logistics activities).

Who to link to through the IOS? IOS partners may be categorized in many ways based on different business needs. This dissertation classifies IOS partners into six categories: customers, suppliers, (financial) service providers, external design partners, dealers, logistics partners, and competitors. For different partners, different IOS technologies may be used. For example, the Internet and B2B exchanges provide open, flexible platforms. They are efficient for linking to potential customers, suppliers, and competitors. Groupware systems facilitate unstructured knowledge exchange and provide an effective means for linking to suppliers and external design partners.

What business activities will be supported by the IOS? IOS can be used to support a wide range of activities, such as procurement, product development, production, logistics, marketing & sales, and customer service. Some IOS may provide a common infrastructure for supporting many activities (e.g., the Internet, extranet, and B2B exchanges may support all the activities listed above), while some IOS may provide limited support for certain activities (e.g., sales automation systems are used particularly for supporting marketing & sales activities).

How to use the IOS? Roles of IOS can be considered along three ways: innovation,

exploration, and exploitation. Specifically, which existing IOS technologies can be used in the

current business context? Are there any new applications of the existing technologies that may provide a more efficient support for the current needs (e.g., can EDI systems provide a better solution to support the current product design process than groupware systems)? Are there any emerging technologies that can be applied to meet the current needs (e.g., can wireless supply chain systems be used to improve customer service)? Which IOS technologies can be used to link to the desired partners at a low cost (e.g., can Internet-based EDI provide a low-cost

solution for linking to small, significant partners with less sophisticated IT capabilities)? Which IOS technologies provide a greater potential for exploiting the existing partnerships and

used to develop joint processes of forecasting, store layout, pricing, purchasing, and payment with a particular partner beyond the simple boundary transactions and information transfer)? Along the line, a list of IOS candidate technologies can be identified. Using the three IOS measures (IOS reach, range, and diversity of use), identified candidate technologies can be further evaluated and compared systematically. Those candidates, which provide the optimal combination of IOS reach, range, and diversity of use, will be selected for use.

In order to understand strategic opportunities for the use of IOS, it is helpful to develop a roadmap that can guide a systematic thinking in identifying IOS opportunities (Johnston and Vitale 1988). Although there may be many ways to categorize and identify IOS opportunities, the value of the roadmap introduced here arises from its utility (1) in structuring the many combinations of possibilities for gaining advantage through the use of an IOS, and (2) in providing evaluation tools that not only allow for a systematic comparison of different combinations of IOS opportunities, but also are easy to use.

The roadmap introduced here may also serve as a useful tool for systematically

identifying IOS-based interfirm innovations. Continuous identification and exploitation of IOS innovations may bring about radical and rapid improvements in firm performance, providing a sustainable source for achieving competitiveness. Many powerful innovations may have the potential to diffuse into the wider economy and produce industry-wide or even greater impacts. In addition, such a roadmap would also be instrumental in helping business leaders understand the potential opportunities for using IOS and their benefits and pitfalls before introducing them.