Initial assumptions

In the first heady years of the dotcom boom, everyone thought of the Web as a place where all you needed was a bright idea and you could make a fortune. The only problem was that for most of the ideas you needed finance. To get finance you needed a business plan.

Unfortunately, practically all the ideas and the business plans achieved nothing more than losing a lot of money. What was needed was not business plans but business strategies. Business plans assume you know how the future is going to plan out. Business strategies don't make that assumption. Instead, they begin by listing all the possible hazards. Here is a list of such hazard taken from the book "The Ultimate Game of Strategy" by Peter Small (Pearson - 2001):

This is a list of some of the assumptions it would seem prudent to take into consideration when starting out on the design of any e-business or e-commerce strategy:

1) Accept that sudden and dramatic changes will occur constantly.

2) Assume that whatever you do will be rapidly outdated by new technological developments.

3) Assume whatever you do or say will quickly be known to everyone else.

4) Assume that whatever you do will be copied or bettered by your competitors.

5) Assume that all services and products will get progressively cheaper as increased competition, reduced costs and increased efficiency bring prices and profits down to a minimum.

6) Assume, whatever you are offering, there will be a plethora of similar alternatives in the market place already.

6) Assume all potential clients or customers are constantly deluged and swamped with information.

7) Allow for the fact that credibility and trust are very hard to come by.

8) Assume that whatever you do there are thousands of others trying to do the same thing at the same time.

9) Assume nobody knows all the answers.

10) Assume nobody can have more than one area of real expertise.

11) Assume that the solution you have to come up with is beyond yours, or anyone else's imagination.

12) Assume the environment of the Internet and the world wide Web is beyond your or anyone else's ability to be able to understand it completely.

13) Assume everyone is occasionally unreliable.

14) Assume everybody is mostly too busy for you to be able to get their attention.

15) Assume most people haven't the time to listen to what you have to say.

18) Assume that whatever technology, programs, tools, methods and techniques you use will rapidly become unsuitable or irrelevant.

16) Assume that any final solution you come up with will have to be abandoned or radically altered within a very short period of time.

17) Assume that whatever you know there are many more important things that you ought to know but don't.

18) Assume nothing is free even if it seems to be.

19) Assume nobody is going to co-operate with you unless they see there is something worthwhile in it for them.

20) Assume everyone is going to distrust you until you have built up a relationship of trust with them.

21) Assume whatever you know, somebody knows it better

22) Assume anyone you want to establish a communication relationship with has only a very limited number of people they have time to write emails to.

With these set of assumptions, it would seem impossible that a suitable strategy could be devised to be able to make a success of any e-business or e-commerce enterprise. However, these same problems are going to be encountered by all competitors. The winners are going to be those who are best able to play the game in spite of all these problems.

What makes the effort worthwhile is that the Internet is an environment rich in non zero sum games where everyone can be a winner. The increased efficiencies brought about by digital communication technology can create innumerable win-win situations where winning isn't about winning off other players but winning with them. This will involve strategies based upon establishing co-operative relationships with people rather than competing with people for limited resources.

If the twenty-two initial assumptions are taken into serious consideration, it rules out the possibility of using any set or rigid plan. The only possible approach is to use a flexible framework, which is forgiving of mistakes, misjudgements and misconceptions. Such a framework is game theory, which allows decisions to be made on the basis of possibilities and probabilities: minimising the effects of uncertainties and unknowns by spreading risk.