How Companies Use Their Website to Gain and Sustain Competitive Advantage

3859 Words Mar 12th, 2011 16 Pages
Long Island University | E-Commerce Project | How Companies Use Their Website to Gain and Sustain Competitive Advantage | Course:MBA 620-001Instructor:Dr. Shailendra C. Jain Palvia | Li, YiLiao, JiaxingLin, FangyunLuo, Kaikai | 12/1/2009 |


1. Background
Electrical commerce, commonly abbreviated to e-commerce, generally consists of the developing, marketing, selling, delivering, servicing, and paying for products and services over electronic systems such as the Internet and other computer networks. With widespread Internet usage, the amount of U.S. e-commerce growth has dramatically increased in last decade. In today’s competitive jungle, providers of any kind and consumers with any need are utilizing the growing
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The primary suppliers of leading consulting and outsourcing services industry are information system providers who aren’t that powerful any longer. According to Moore’s Law, the Law of Mass Digital Storage, and Metcalfe’s Law, the cost of information system becomes lower and much lower. Therefore, the bargaining power of suppliers of this certain industry is weak.
3.4 Threat of substitute products
The development of Internet creates new substitute threats. The services and products of the three chosen companies are primarily focusing on custom-made market in order to meet client’s need of any kind. However, substitute products such as normalized software package and standard system built-in hardware solution are driving in an incremental speed. Moreover, products and services provided from SMEs around the world are more and more competitive in lower price and flexibility. Thus, the threat of substitute products is at a high level.
3.5 Competitive rivalry within an industry
The four previous forces influence the rivalry among competitors in the market. There is definitely more rivalry now. Large company such as IBM Global Services is facing intensive competition from similar-scale companies, for instances, Accenture and Capgamini. In addition, increasing amount of companies of smaller size is emerging into the international competitive
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