eThesis - Kauppakorkeakoulun sähköiset gradut

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This study examines how e-business initiatives are able to create value, from a shareholder value perspective, through four value drivers: efficiency, complementarity, lock-in and novelty. For this purpose, a theoretical framework that links these four value drivers of e-business to the shareholder value approach is built; more specifically, to the four financial value drivers of shareholder value (acceleration, enhancement and reduction in the risk of cash flows as well as augmentation of the long term value of the business). In practice, the objective of the framework is to examine a chain of linkages that connect value drivers of e-business to financial value drivers of shareholder value and consequently to a set of metrics assessing financial outcomes of firms. Then, empirical evidence is introduced to verify the validity of the previously designed framework

The data used in this study were collected through a web-based questionnaire targeted to the upper management in Finnish companies representing the media industry. The survey was sent to 319 decision makers, of which 70 completed the questionnaire resulting in a response rate of 22%. The data were analyzed using two multivariate data analysis techniques: confirmatory factor analysis and structural equation modeling.

The findings of this study suggest that e-business initiatives have an effect in the shareholder value of firms both in the short and the long term. In particular, e-business initiatives show a robust effect on shareholder value by accelerating cash flows and augmenting the long term value of the business. Based on these findings, managers should carefully examine the potential of the internet as a strategic element when it comes to strengthening bonds with customers, reinforcing the value of the brand and reducing information asymmetries with stakeholders. In order to get the benefits of online presence, managers should consider how to align e-business initiatives of their firms to their strategic objectives. From a theoretical perspective, the present study contributes to the existent knowledge in the field of e-business and strategic marketing in two ways. First, this study is the first attempt to empirically examine the value creation process in the context of e-business from a shareholder value perspective. Second, this study provides a valid and reliable scale development for the value drivers of e-business and the financial value drivers of shareholder value.

In sum, this study responds to recent requests from academics to demonstrate the impact of marketing activities, in this case related to e-business, in terms of shareholder value; hence contributing to a marketing- finance conciliation.