The new era of e-business, and what about Amazon?

Just recently I was explaining to my MBA students the difference between e-commerce and e-business.  As always, I said that e-business means profund transformations in the way companies do business.  So that they make the best of information technologies and add value to their customers.  

I also mentioned that companies should redesign if not reengineer their processes in order to integrate technology.  

And then I was asked the question : is Amazon an e-business?

Silence in the room...

This question has puzzled me for a couple of years.  Other students have asked me if Amazon has had a clear strategy to become what they have become.  

My answer to the latest question and the others has been: Amazon is a strange case, like a strange animal.  You try to picture it using ideas of strategy and e-business and you do not fully succeed.  

So this time we tried to pin Amazon down as an e-business.  And guess what.  Amazon was left wandering.

Yes, because out of the discussion, it became useful to think of an e-business as a pioneer type of business, one which changes the nature of existing business models.  Amazon could have done that at the beginning when they were selling things online (books, CDs).  The idea is to attract customers to a new business model, an online one. 

But now they are virtually eating their competitors, and not only by achieving differentiation in costs, bit also by raiding their offline world.

Take for example the UK bookshop Waterstone's.  They are now selling Amazon Kindle devices.  They said they have no other option.  They get a cut of the sales.  

But they at losing market to both Amazon and to the electronic books sellers.  So any compensation they receive from Amazon is at the expense of helping Amazon establish a business model that is not fully online, at the expense of their own business (offline) model.  

We are coming to see that a new era for e-business should be about a consistent and ethically driven interaction of online and offline worlds.  In the case of Amazon, they might grow bigger, but they will have to think if what they are doing in the offline world is the right thing to do.  Just like the supermarkets like Walmart.  They are the big player in a supply chain, but why do you have to eat the smaller players if you need them? 

Both online and offline worlds cannot coexist without each other.  Just as much as we say that e-business is about being online. We should also say that this being has a moral drive to at least not harm directly others.   And if you do, help them become part of a wider system, one that is bigger than you and the others.