Developing a framework for studying the idea of how the service affects the economy of online organizations. Development framework requires an understanding of the various forms of services is in organizations that do business over the Internet. These forms are described as "virtual" (pure information or automated) and "physical" (which require some degree of human intervention). Because the nature and amount of physical services necessary to achieve customer value affect the amount of human intervention is required, they also affect the ratio of the firm variable fixed costs, which changes its "scalability." The paradox is: many venture capitalists and supporters of online business sense to reduce the negative scalability, but the reason for this decline scalability, human intervention, it often helps us to differentiate their offering to customers, thus providing a source of competitive advantage. It also shows that the scalability of itself is not enough to make a profit. "Hide
by Roger Hallowell 22 pages. Publication Date: March 25, 2002. Prod. #: 802146-PDF-ENG
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