Business use of the internet: A longitudinal study from a value chain perspective

This study explores the relevance of the value chain concept in internet‐driven business and assesses the extent to which businesses utilize the internet from a value chain perspective. It attempts to answer the following three questions: is the value chain concept relevant and applicable to the internet as a means of understanding the internet? To what extent do organizations utilize the internet according to a value chain perspective? Does the business use of the internet change over time?

To answer these questions, a longitudinal survey study was conducted over a two‐year period. The first study collected data from 110 firms on the way they utilize the internet. Two years later, a similar survey was conducted with 70 firms using the same instrument used in the first study.

The study provided empirical support for the use of the value chain concept as a viable taxonomy for assessing the level of adoption of the internet. The study also provided a time‐lapsed glimpse of how organizations evolve in adopting the internet.

One of the shortcomings of the study is in the sampling process, although various measures were taken to ensure that the data represent a wide range of organizations, so that the findings can be reasonably generalizable.

The most important practical contribution of the study is that it provides practitioners with a tool to systematically plan and deploy an ever‐increasing array of internet applications. The internet value chain model should provide organizations with a strategic and macro perspective to evaluate and manage various internet applications.

An important contribution of this study is that it empirically observed the evolution of the internet practices in business according to the value chain framework. There has been plenty of anecdotal evidence of changes in the way business utilizes the internet, but no study has empirically assessed these changes systematically based on a theoretical framework. The study provides a valuable theoretical framework for researchers to continuously accumulate knowledge on the use of the internet in business.