Strategic e-Business Decision Analysis Using the Analytic Network Process

Abstract

The rapid global deployment of electronic business (e-business) and information systems has required managers to make decisions that seek to balance technical factors with strategic business goals. This research utilizes the analytic network process (ANP) to provide insight into optimum-seeking decision processes by managers, as investments are made to utilize e-commerce technologies. The nonlinear network approach of ANP was used to study the "systems with feedback" where the e-commerce strategy may both dominate and be dominated, directly and indirectly, by the business-level strategy. This study analyzes e-business decisions in organizations, based on management heuristics and perceptions of expected contributions of e-commerce strategies, as well as the business-level strategies. The ANP research methodology process is employed since it is well suited for the study of a multi-attribute decision problem to explore qualitative and quantitative preferences of top managers in independent, nondiversified firms involved in e-business. ANP is used to model decision complexities involved in integrating e-commerce innovation into the overall strategic planning of firms. Optimal e-business strategies are chosen by using systems-with-feedback, where interdependencies between four virtual e-commerce domains and two generic business level strategies are explored. This study obtained significant results and identified several important avenues for further research. Implications for theory and research are discussed.