Web 2.0 and its effect on the strategic directions of business firms and the boundary of the firm Online publication date: Wed, 22-Apr-2015
by Som Sekhar Bhattacharyya
International Journal of Business Competition and Growth (IJBCG), Vol. 1, No. 4, 2011
Abstract: This paper develops frameworks explaining the future strategic directions business firms will be necessitated to undertake because of the advent of Web 2.0. This conceptual paper explores the effect of Web 2.0 on the boundary of firms and its value chain. The paper presents that Web 2.0 will make the boundary of the firm porous as the concept of a free-flowing loose network of relationships of both formal and informal organisations, customers, individuals and institutions will become dominant. The firm value chain would get altered, as it would get more distributed and fragmented. Business firms would face both challenges and opportunities because of the distributive ability and agility of Web 2.0 participants. Managers based on the proposed frameworks can take decisions on innovation strategies for firm boundary consideration regarding outsourcing various value chain functions and further on the nature and extent of adopting and absorbing the Web 2.0 participants.
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