Introduction

In the last ten years, the economy of Ireland has been transformed from a largely rural, agricultural based economy to an urban, technologically advanced digital economy and in the process has become one of the leading per capita economies in the world. (CIA World Factbook, 2001)

This has enabled Ireland to position itself as a key player in the emerging digital economy. One of the major innovations of this emerging economy has been the widespread introduction of technology to enhance business. Enterprise Ireland has defined this as E-Business. This use of technology includes the trading of goods and services by electronic means and these electronic means have been mostly focused on the Internet, namely through email and the World Wide Web, although touch screen and digital television are also viable electronic business media. E-Business will change the way businesses interact with outside parties. (Enterprise Ireland, 2001)

This study will focus on the provision of E-Business by small service providers (consistent with the PLATO model, namely 3-50 employees.) Services have an advantage over physical goods in that they are much more likely to be able to be digitised and thus are more likely to be able to be provided in an entirely electronic way in the future. In the Dimensions of Electronic Commerce model outlined by Turban et al (1999), Electronic Commerce is considered to have 3 dimensions, namely product or service, process and delivery agent. These dimensions can be either physical or virtual and it is the combination of physical and virtual dimensions that outlines the extent to which a business has become an E-Business.

In traditional business, all the dimensions were physical whereas in pure E-Commerce the dimensions are all virtual. In this website, we will introduce a three-stage model for the adoption of E-Business by small service providers (based on the Choi model). We will define each of the three stages (Using Electronic Media, Providing Services Online and E-Business Pure Play) and the processes needed to implement them. We will also focus on the components of E-Business and how they apply to small service providers in an Irish context. We will conclude with a view on the viability of the three-stage model and an outline of some of the upcoming developments in E-Business and the impact they may have for the small service providers.

The 3 Stage Model

In Electronic Commerce: A Managerial Perspective (Turban et al., 1997), reference is made to a model representing the dimensions of E-Commerce. This model, originated by Choi et al in 1995, argues that there are three constituent factors in E-Commerce, namely Product (or Service), Process and Delivery Agent and that these three factors can be either physical or digital. This allows for eight possible combinations, each of which, with the exception of where all three dimensions are physical, can be legitimately termed as E-Commerce.

Fig 3.1

Service providers have an advantage over those businesses that are selling products in that their service is much more likely to be able to be digitised than a physical product. This enables the service provider to take advantage of the web as a delivery medium and not just as a payment or marketing medium. Digitisation of service provides the small service provider with the possibility of moving their business towards the E-Commerce Pure Play paradigm where all three dimensions are digital.

The E-Business Model, and the Pure Play paradigm in particular, as a business model can lead to lower costs since the need for expensive high street offices and costly delivery services is eliminated. Why then do all service providers not move to this model? The answer is that it is not as easy as it looks and getting it wrong can cause serious or fatal damage to the business. 'Attempting to launch an E-Business solution on an ad-hoc basis is doomed to failure' (Enterprise Ireland, 2001).

E-Commerce as a term has been largely superseded in the last few years and is now more commonly referred to as E-Business. 'E-business (electronic business) … is the conduct of business on the Internet, not only buying and selling but also servicing customers and collaborating with business partners' (www.searchebusiness.com, 2002). For the service provider to move to E-Business in any form, it is important to have a good understanding of what E-Business is and what it's components are. For the large enterprise, this will normally be achieved through the creation of a new department and the hiring in of specialist staff and/or consultants. The small business does not have this luxury.

The OECD found that the most significant barriers to E-Business for SMEs were a lack of awareness about E-Business and uncertainty about its benefits (Joint Committee on Enterprise and Small Business, 1999).

We propose to demonstrate a model for implementation of E-Business by the small Irish service provider. This would allow the managers/owners to get a good grounding in the area of E-Business as well as understanding the possibilities for expansion of their business into the electronic medium. This model is based on the Dimensions of Electronic Commerce model and has three stages:

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