IMPACT OF E-COMMERCE AND

INTERNET
 Benefits of e-commerce
• It expands the marketplace to national and international
markets.
• It decreases the cost of creating, processing, distributing,
storing & retrieving information.
• It helps in managing the inventories and in managing
SCM.
• Enables the customization of products.
• Customers are much more demanding due to exposure
to the internet.
• Manipulate large amounts of information about customer
to identify trends, preferences.
• Improve decision making about delivering on customer
value proposition.
• E.g. Amazon.com ‘s only strategy is to provide
products at lowest prices & to provide quality
experience with the help of internet backed up by
its partnerships with other firms as Target, Toys
‘R Us, Circuit City, and Drugstore.com.
 Wal-Mart Success
• Since 1997, Wal-Mart has been selling its products
through the internet.
• Wal-Mart introduced WIN or Wal-Mart’s Innovation
Network which allowed entrepreneurs to gain entry into
the company’s huge distribution system.
• It helped Wal-Mart to diversify its product lines.
• It uses Internet to achieve outstanding supply chain
management via virtual warehousing and B2B electronic
ordering.
• Wal-Mart uses its own proprietary supply chain system,
Retail Link, and it requires all of its over 7,600 suppliers
to receive and manage orders through the system, which
was transferred to the Internet in 1997.
 STRATEGIC DECISION MAKING
“Distinguishing characteristic of strategic management”
• Strategic Decision Making enhances managers’
abilities to obtain insight and exercise judgment by
deepening their decision-making skills and helping
them to design more effective decision processes.
• Managers in the business world often fail to make a
decision in right time and allow the opportunities to
be grabbed by the competitors and the problems
remain or magnify and culminate into a crisis.
• The need for decision making arise only when there
are two or more alternative solutions for a problem.
• Decision making pertains to all managerial
functions but strategic-making relates to the
responsibilities of the senior management.
• The thrust area of strategic decision-making is to
make a choice regarding the course of action to
adopt.
• The essential strategic decisions relates to the
choice of a mission.
• Strategic decisions have the following
characteristics:-
– Rare and uncertain
– Consequential
– Directive
Modes of strategic decision making
According to Henry Mintzberg:-
• Entrepreneurial mode
• Adaptive mode
• Planning mode
• Logical increamentalism
 Routine/ Programmed Decisions

• Are taken by an established or systematic

procedure.
• The decision maker, in general knows the situation.
• Managerial decisions covered by policies,
procedures and rules are taken by following
established guidelines.
 Strategic/ Non-Programmed
Decisions
• Have little or no precedent.
• Relatively unstructured and require a more
creative approach.
• The decision maker must develop a procedure
to be followed.
Issues in Strategic Decision-making

• Criteria for decision-making

• Rationality in decision-making
• Creativity in decision-making
• Variability in decision-making
• Person-related factors in decision-making
• Individual versus group decision-making
P&G’s decision to withdraw 2 products from
Qatar
P&G was forced to withdraw 2 variants of Heads and
Shoulder’s -Lively & Silky and Shine due to problems in
operating in Qatar. As per the Qatari authorities, these 2
variants contain more that agreed level of 1,4-dioxane
(chemical) which can cause cancer. For the time being
the company has withdrawn and left this matter to
discuss the Qatari authorities later.