Patterns of capability acquisition in electronic commerce

This article examines how firms acquire capabilities for electronic commerce operations. There is a wide variation in views about how to achieve commercial success based on electronic commerce. The question posed in this article is whether there is an observable pattern in how firms acquire new electronic commerce capabilities. The article builds on a supply pattern hypothesis, suggesting that there are two basic sources of capability acquisition for a firm; from internal sources through in‐house innovation or cloning‐replication, or from external sources through collaboration, firm purchasing or cloning‐imitation. In longitudinal case studies of Dell and Compaq, patterns whereby firms can acquire electronic commerce capabilities, both from internal and external sources, are discerned. Three levels of each organisation and five phases in the strategic development of the companies' distribution channels and market positions are covered in the analysis. The implications for electronic commerce are also discussed.