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E Business: Concepts and Context
E Business: Concepts and Context
Abstract :
In this research we explore the theoretical foundations of value creation
in e-business, Electronic Business, commonly referred to as "eBusiness" or
"e-Business", which may be defined as the utilization of information and
communication technologies (ICT) in support of all the activities of
business. Commerce constitutes the exchange of products and services
between businesses, groups and individuals and hence can be seen as one of
the essential activities of any business. Hence, electronic commerce or
eCommerce focuses on the use of ICT to enable the external activities and
relationships of the business with individuals, groups and other businesses .
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1. Introduction
The above objectives are forming a model framework for the current
research, which formed the vocabulary as contained in its research
dimensions.
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2. E-Business Concept
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reduces the time exposure
supports BPR - Business Process Reengineering
increases productivity
improves customer service (in some cases)
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legal issues outstanding such as jurisdiction
legal environment has many new and conflicting laws
cultural obstacles
linguistic challenges
o limitations of support services
financial cost
sourcing tech support in foreign languages
o lack of critical mass in certain market areas for sellers and
buyers
o accessibility outside of urban/suburban and areas effects
universality
o higher employee training required to be click and mortar
o people's resistance to change
o people not used to faceless / paperless / non-physical
transactions
1. Broad expectations.
We must avoid over-expecting—or over-promising—e-commerce
lest we create a backlash when its promises are not fulfilled. E-
commerce will not, in and of itself, correct all the industry's problems .
2. Rote applications.
Little or no improvements will come from the rote imposition of e-
commerce techniques on bad practices. Ensuring the appropriate
application of e-commerce requires us to ask more than whether we can
apply e-commerce to a practice and to consider whether we should...
For example, it does little good, and may even do harm, if suppliers
simply receive inaccurate information more quickly via the Internet.
3. Incomplete implementation
The benefits of e-commerce will be restricted if we do not
recognize its full system implications, and instead implement it in
limited ways that only partially meet its requirements. For example,
some e-commerce benefits depend on replacing people with bytes. To
the extent that we do not reduce headcount, or even worse, run parallel
people/byte systems, e-commerce’s benefits will be limited.
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4. Information Technology and Business
This has been contributed to make all business process available to all
beneficiaries possible..As such, The United States Census Bureau defines e-
business as “any process that a business organization conducts over a
computer mediated network. Business organizations include any for profit,
governmental, non-profit entity. Their processes include production-,
customer-, and internal or management-focused business processes.” In a
shorter broader sense, e-business is the process of conducting business
electronically or over the internet. Electronic mail is e-mail, electronic
commerce is e-commerce, and following this formula, electronic business is
e-business. Every time business is conducted over the internet, e-business
takes place and as the internet grows, so grows e-business
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2.6 Business to Business (B2B)
The largest form of e-business in terms of money spent is B2B.
Business-to-business allows trading to take place between businesses, using
a low-cost sales channel for the sale of goods and services and is responsible
for constantly changing corporate buying habits.
An example of a B2B site would be a car part company selling parts
to a car dealership, another company, rather than directly to consumers.
While the words Commerce and Business don't have much difference in
English and in fact are largely interchangeable as nouns describing
organized profit-seeking activity, there is a difference between e-Commerce
and e-Business. The difference is quite artificial, but different terms do
carry different meanings (www.ebusinessprogrammers.com).
Often it seems that the term of e-commerce e-business are the same, it
is not true, the electronic commerce is responsible for business relationship
with the buyer, the seller and the implementation processes of relationship in
this context, both are technical means, while the more comprehensive e-
business as it includes the conversion of all the paperwork to e-business,
financial and administrative services, and also include the control of the
work, which falls under the concept of many tasks, such as e-banks and e-
government services …etc. However, there is much more to e-Business than
selling products.
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Products or Services through internet, Use internet to conduct market
research, use internet to hire people, use internet for product or service
promotion etc.
However, to clearly bring out the differences between the two as both
of them are completely different phenomenon are as follows:
(www.ezinearticles.com)
1. E-Commerce is the subset of E-Business.
2. Those activities which essentially involve monetary transactions are
termed as "e-commerce". However, e-business is a much broader term.
There are many other things besides selling including but not limited to
marketing, procurement of raw materials or goods, customer education,
looking for suppliers etc.
3. To sell online is e-commerce but to bring and retain customers and
educate them online about the product or service is e-business. Having a
website to do it is not sufficient. But, having a professionally built
website loaded with latest technologies to capture the attention of the
visitor and win his/her appreciation is required. When money is involved
then the first thing which user looks for is safety and security of his/her
money. Having a website laden with such qualities is important.
4. When Dell sell computers, laptops, monitors, printers, accessories etc
online then it is not engaged in e-commerce but e-business. Let me tell
you how. When a visitor comes on the website, the first thing he see is
website design and navigation as well as those things which are going to
help him find what he is looking for and if he directly lands on the page
he was looking for, he looks for the information related to it. The
information provided should be appealing and clear maximum doubts of
the visitor so as to convert him in a client. Till now no money has been
exchanged nor been talked about. So, was this e-commerce? No, it is e-
business which guides the visitor.
5. E-commerce has also been defined as a process covering outward
processes that touch customers, suppliers and external partners while e-
business covers internal processes such as production, inventory
management, product development, risk management, finance etc.
6- In all, e-commerce can be described as the use of the Internet and the web
to transact business. More formally, digitally enabled commercial
transactions between and among organizations and individuals. On the
other hand, e-business can be described as the digital enablement of
transactions and process within a firm, involving information systems
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under the control of the firm. Moreover, e-business applications turn into
e-commerce precisely when an exchange of value occurs.
7- In practice, e-business is more than just e-commerce. While e-business
refers to more strategic focus with an emphasis on the functions that
occur using electronic capabilities, e-commerce is a subset of an overall
e-business strategy. E-commerce seeks to add revenue streams using the
World Wide Web or the Internet to build and enhance relationships with
clients and partners and to improve efficiency using the Empty Vessel
strategy. Often, e-commerce involves the application of knowledge
management systems.
8- E-business involves business processes spanning the entire value chain:
electronic purchasing and supply chain management, processing orders
electronically, handling customer service, and cooperating with business
partners. Special technical standards for e-business facilitate the
exchange of data between companies. E-business software solutions
allow the integration of intra and inter firm business processes. E-
business can be conducted using the Web, the Internet, intranets,
extranets, or some combination of these.
Having a successful business in the real world is more than just simply
opening a storefront or factory. The same holds true in that conducting
business online is more than having just a web site. There are other
fundamental variables to consider for a business to succeed. (Greg Spaulding
2003)
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The reason why is quite simple. Most companies mistakenly make use
of the Internet for just basic eCommerce, not actual eBusiness. In doing so,
other intrinsic and critical business functions found in a true eBusiness
platform are neglected. The use of an exclusive e-Commerce platform is a
common and understandable mistake. If you were to survey a room full of
senior corporate executives, almost all questioned would not be able to tell
you the difference between eCommerce and eBusiness. But make no mistake
about it; there is a difference between eCommerce and eBusi-ness, a
tremendous difference.
The biggest mistake Widgets, Inc. made was not taking into
consideration that although their web site at first glance is only a portion of
their corporation, their site is a very visible and therefore, influential
representation of their corporation. If the site is not able to fulfill the duties
of its brick-and-mortar counterparts, then it does not properly represent the
qualities that it should. Such a faux pas can also ruin the possibility of
increased profits that Widgets, Inc. would make, from a quality and efficient
Internet division of their business.
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In actuality with the right implementation, the eBusiness faction of a
company can be more profitable than their brick-and-mortar counterparts
without comprising the same "real world" philosophies that helped propel
the company to success in the first place. All you need are the right tools and
how to make the most of them.
Now, imagine being able to maintain and manage every aspect of your
traditional business, but have access to it anywhere in the world. Imagine
expanding your business without having to build expensive storefronts.
Imagine running elaborate, expansive, intricate marketing campaigns in
hours rather than weeks and at the fraction of the cost. Imagine your RMA
and CRM satisfaction levels being either at par or higher online in
comparison to your brick-and-mortar division. In today’s e-Business world,
these concepts are not possibilities, but a reality and need to be implemented
in every Internet business structure as such.
These are just a few examples of how an expansion into the Internet via
eBusiness can vastly increase your profits without conceding the very
idiosyncrasies that made you successful in the first place.
Afuah and Tucci (2003) recommend that all organisations that are
affected by the Internet should have a dedicated “business model”. The
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authors justify their suggestion by pointing at the complexity, speed and
uncertainty of Internet trading. Matlay (2004) agrees with this advice. An
effective business model often depends upon organisational aims, human
and physical resources as well as market orientations. Bakker (2005) does
the simple observation that an increasing number of people are not only
using the Internet, but who are relying on the Internet for social contacts,
purchasing goods and being informed on what is happening in the world.
The Internet is becoming a significant factor in today's society.
Because the internet has become mature and new simple techniques
make it possible for everyone to use the internet new aspects of e-Business
and e-Entrepreneurship become more important. Although much has been
written about these developments, scientifically research about the
underlying value drivers of this next stage is missing. This research attempts
to fill this theoretical gap by seeking to identify the (most important) value
drivers, features and underlying business models in Web 2.0.
The scarce e-business theory on value creation, the increasing use and
importance of the Internet, and the emergence of Web 2.0 ask for a close
look at features of the New Internet and it’s underlying value drivers.
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With this research a contribution to value creation theories and business
model theories in the field of a combination of entrepreneurship and
strategic management is delivered. This research does not only contains
value drivers derived from Strategy theories, e.g. Strategic Network Theory
(Dyer 1998), but also focuses on Innovation and Entrepreneurship theories,
e.g. Schumpeter’s theory of creative destruction (Schumpeter 1942). This
research also contributes to the scarce theories of e-businesses by looking at
new developments within the Internet, particularly Web 2.0.
Research on e-Business Value drivers are useful but probably not up-to-
date anymore with the emergence of Web 2.0. The research of Amit and Zott
(Amit 2001) for instance deals with companies before the Internet bubble of
2001. With Web 2.0 new features of the Internet transactions and
participations are taking place. More and different stakeholders add value in
e-business. This raises questions which (new) value drivers we can find in
Web 2.0 and which ones are more important. By looking at these factors we
are indirectly looking at the business models that are important in the New
Internet. Providing more insight in value drivers and business models in
Web 2.0 enables companies and entrepreneurs to adopt and prepare to take
advantage of opportunities in this next stage of the Internet.
In 2003, CSU offered more than 300 courses to 40,694 students. 29,325
students were enrolled in pure distance education mode and another 3,911
students undertook their studies through mixed mode (CSU, 2003).
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business built on the Internet and business providing the infrastructure. The
second major category of e-business model comprises businesses that
provide the platform upon which digital businesses are built and operated:
The UCC was the first public ISP for the country. It initially provided
free Internet accounts for the first one hundred users in order to build
awareness about the Internet. Today, UCC has more than 2000 e-mail clients
registered on the web as email users and around 600, those who pay for
email use.
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Analyzing UCC as an ISP, it provides e-mail and Internet access to
individual citizens and organizations, including the University, to conduct
their business. These services are part of the core business of UCC. The
question that arises is how UCC became one of the major ISPs in the
country?
The UCC’s first Internet connection was in 1992 through a dial-up link
of 9.6Kb to Rhodes University in Natal, South Africa, through UNINET,
paying $14,000 USD/month. In 1993, the Center moved to a leased line of
14.4 Kb, then to 28 Kb and then 33 Kb. Its first VSAT link was through
transtel in South Africa (64 Kb connection).
This is a 2-way link (394 down and 128 up). The second VSAT link
(through the World Bank’s satellite channel) is from the US. It is a 512 Kb
link to be strictly used for educational purposes (such as video conferencing)
and not for commercial purposes. This link was funded through the World
Bank. The UCC is licensed to provide Internet services, which maintains its
license through payment. The UCC also has a license for a wireless
metropolitan network, which costs the same as the ISP license.
2. 2. 10 Objective Analysis
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of finding the right partners to fund the infrastructures and interested in the
same business as UCC was one of the major issue to the success of the
business provided to the clients in a very a low costs.
3 . 2 . 10 Lessons learnt
Critical success factors
UCC was always led by many bright minds who are tirelessly striving
to lay the foundations and building blocks of an economy that can compete
in the new world order, an economy that has only recently ended two wars,
one civil and the other of independence, not so long ago. The team lead is
characterized by:
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11. Conclusion
However, despite this, the question raised about what does e-business
mean? the answer is clear across the research that e-business actually means:
Better procurement and supply chain, making sales teams more effective, the
ability to outsource functions such as accounting, remote access to systems,
linking management teams in different locations, being able to locate the
lowest cost supplier, improve customer services, improved collection of
customer information for databases and more effective management of
remote manufacturing sites. More over it has many useful attributes such as:
Improved accuracy, quality and time required for updating and
delivering information on products and/or services.
Access for customers to catalogues and prices - 24 hours x 7 days.
Improved ease, speed and immediacy of customer ordering.
Enhanced market, industry or competitor intelligence acquired
through information gathering and research activities.
New distribution channels via the electronic delivery of some
products and services, for example, product design collaboration,
publications, software, translation services, banking, etc.
Expansion of customer base and growth in export opportunities.
Reduces routine administrative tasks (invoices and order records)
freeing staff to focus on more strategic activities.
On the other hand, e-commerce websites take a front seat, moving out
to the millions of people looking for your kind of product or services online.
Electronic Commerce is actually trading of, either goods or services on the
internet.
Before making any decision in business, it is worth taking into
consideration the benefits, the company would reap on implementation of
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the new strategy of Ecommerce. Therefore, the most important thing that
you must consider here is whether your business actually needs ecommerce?
Consequently, no firm is invulnerable from the changes that e-Business
will bring to their market place.
References :
6. Dyer, J., Singh, H. (1998). "The relational view: cooperative strategy and
sources of interorganizational competitive advantage." Academy of
Management Review 23: 660-679.
7. Gartner (2006). Hype Cycle for Emerging Technology 2006.
Louis Gerstner, the former CEO of IBM, in his book, Who Says Elephants
Can't Dance? attributes the term "e-Business" to IBM's marketing and
Internet teams in 1996.
8. Greg Spaulding(2003), Marketing significance of e-business vs e-commerce,
moorparkacorn, California, USA.
9. Martin, L. and H. Matlay (2003). "Innovative use of the Internet in
established small firms: The impact of Knowledge Management and
Organisational learning in accessing new opportunities." Qualitative
Market Research 6(1): 18-26.
10. Matlay, H. (2003a). Small Tourism Firms in e-Europe: Definitional,
Conceptual and Contextual Considerations. in R. Thomas Small firms in
Tourism: International perspectives. Oxford, Pegamon: 297-312.
11. Matlay, H. (2003b). "e-Babel: in Search of a Theory of e-Everything."
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12. Matlay, H. and M. Addis (2003). "The value of E-Commerce for high growth
SME's."
13. Pradeep Anand- January 1998, The Benefits of eBusiness, January 1998
14. Schumpeter, J. (1942). Capitalism, Socialism, and Democracy. New York,
Harper.
Websites:
www.witiger.com
www.seeta.com
www.iskiv.net
www.ebusinessprogrammers.com
www.buseco.monash.edu.au
www.tanzaniagateway.org
www.unpan1.un.org
www.ezinearticles.com
www.forrester.com (Forrester Research is an independent technology and market
research company that provides its clients with advice about technology's impact on
business and consumers. Forrester Research has four research centers in the US:
Cambridge, Massachusetts; Foster City, California; Washington, D.C.; and Westport,
Connecticut. It also has four European research centers in Amsterdam, Frankfurt,
London, and Paris. The firm has nineteen sales locations worldwide. It offers a variety of
services including syndicated research on technology as it relates to business, quantitative
market research on consumer technology adoption as well as enterprise IT spending,
research-based consulting and advisory services, Events, workshops, and teleconferences
and executive peer-networking programs.
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