Lecture 5

Applications of E-Business
Operations
E-Business Application
• E-Business can be used in the modern business operations to
streamline business activities in so many ways.
• Some of the common activities enhanced by the application of e-
business include:
• E-Banking
• E-Tailing
• ATM Operations
• CRM – Customer Relationship Management
• BPO – Business Process Outsourcing
• Call Centre Management
E-Banking
• The automated delivery of new and traditional banking products and
services directly to customers through electronic, interactive
communication channels. Some of these services include paying of bills,
funds transfer, viewing account statement, etc.
• There exist pure virtual banks (no branches, web presence only) and the
traditional brick-and-mortar banks (more successful) that provide online
services.
• E-banking saves users time and money. For banks, it offers a rapid and
inexpensive strategy to acquire out-of-the-area customers. In addition, the
banks may need fewer branches or employees. Many physical banks now
offer online banking services, and use it as a major competitive strategy.
Services Offered in E-Banking
The common online services offered by banks are:
• Transactional activities like funds transfer, bill pay, loan applications,
schedule advance payments and other transactions.
• Non-transactional activities like request for cheque book, stop
payment, online statements, manage all accounts in one place, track
payment history, updating your contact information etc
E-Banking
3 approaches:
• Dial-in Approach:
Requires users to have a separate finance software, so that they can
do all the process offline and connect to the bank just for transactions.
• Internet Approach:
Users directly log on to their bank website and complete all their work
online.
• SimBanking/Mobile Banking Approach
Users are connected to their accounts and are able to carry out
transactions through their mobile phones using USSD codes
Benefit of E-Banking
• Anytime banking ,and anywhere banking
• Online Banking is much cheaper for the bank as it reduces the cost of
branch services
• Reduction in cost of transaction
• Pay bills online there by saving postal services and other costs
• Easy to make utility payment
• Online purchases
• The services are available seven days a week, 24 hours a day.
Drawback of E-banking
• Difficult in adoption technology
• Fear of technology
• High cost of technology
• Lack of preparedness
• Restriction on usage of technology
• Security risks – customers platforms of accessing are most concerned
• Limited online customer service – instant messaging using AI is being
used by some banks to sort this out
E-Business Application
• E-Business can be used in the modern business operations to
streamline business activities in so many ways.
• Some of the common activities enhanced by the application of e-
business include:
• E-Banking
• E-Tailing
• ATM Operations
• CRM – Customer Relationship Management
• BPO – Business Process Outsourcing
• Call Centre Management
E-tailing
• E-tailing or Electronic retailing may be defined as use of internet to
sell retail goods and services online.
• E-tailing is the practice of selling retail goods on the internet. It is the
abbreviated version of “electronic retailing” which essentially
constitutes business to consumer transaction.
• Retailing (and hence e-tailing) focuses on the final transaction and
therefore sits with the Business-to-Consumer (B2C) model
Types of e-tailers

E-Tailers

Pure Play E- Bricks and

Tailers Clicks E-Tailers
Types of E-Tailers
Pure-Play E-tailers
• A pure play e-tailer uses the Internet as its primary means of
retailing. These are companies with direct online sales that do
not need physical stores, e.g. Amazon.com.
• Virtual e-tailers have the advantage of low fixed costs.
However, one drawback can be a lack of an efficient order
fulfillment system.
• Virtual e-tailers can be general purpose (such as Amazon.com
or Rakuten.com) or specialized e-tailers (such as
Dogtoys.com).
Types of E-Tailers
Bricks and Clicks
• A brick and click e-tailer uses the Internet to push its
goods or service but also has the traditional physical
storefront available to customers.
• Combining this new type of retail and the old of a
general store is a new type of store, a trend that is
being followed by many of the major businesses
worldwide
E-tailing Advantages
Advantages to Sellers:
• Lower product cost, thus increasing competitive advantage.
• Reach more customers, many outside the vendor’s region,
including going global.
• Change prices and catalogs quickly, including the visual
presentation. Such flexibility increases competitive advantage.
• Lower supply chain costs.
• Provide customers with a wealth of information online as a self-
service option, thus saving customer service costs.
• React quickly to customer needs, complaints, tastes, and so
forth.
E-tailing Advantages
Advantages to Sellers:
• Provide customization of products and services, self-configuration,
and personalization of customer care.
• Enable small companies to compete with larger companies.
• Better understand customers and interact with them.
• Engage customers in interesting search, comparison, and discussion
activities.
• Contact customers who are not reachable by traditional methods of
communication.
E-tailing Advantages
Advantages to Buyers:
• Pay less than in traditional or even discount stores.
• Find products/services not available in local stores.
• Shop globally: compare prices and services.
• Shop anytime and from anywhere.
• Find it unnecessary to go to the store wasting time and fuel, and
being pressured by salespeople.
• Create their own designs and products
E-tailing cons
• Trust, security and privacy are a big concern as
consumers are concerned with the use of the data
they provide during transactions
• Ease of use is a problem, as some web designs are
complex. E-tail stores are not standardized in design,
hence different user behaviors (navigation schemes)
need to be learned for each e-tail store. 
E-tailing cons
Other disadvantages include:
• Not all customers have access to the web
• Not sure of product quality
• Cannot bargain/ Negotiate
• Need to touch and feel the product
• Have to wait for delivery
E-Business Application
• E-Business can be used in the modern business operations to
streamline business activities in so many ways.
• Some of the common activities enhanced by the application of e-
business include:
• E-Banking
• E-Tailing
• ATM Operations
• CRM – Customer Relationship Management
• BPO – Business Process Outsourcing
• Call Centre Management
ATM (Automated Teller Machines)
• An ATM is a computer terminal activated by a magnetically encoded
debit card that allows you to make deposits to and withdrawal from
your account, pay bills, and transfer money between your accounts at
anytime.
• An ATM machine is basically an extension of the bank teller’s services
to customers at any time, outside the banking hall
• Customers can interact and operate their accounts to a certain limit,
at any time without the need to interact with the bank’s personnel.
ATM (Automated Teller Machines)
ATMs can:
• Withdraw cash
• Deposit cash
• Deposit cheques
• Pay bills
• Top-up stored value accounts (mobile money, airtime, smartcard etc.)
• Transfer funds between accounts
• etc…
ATM (Automated Teller Machines)
ATM Types:
Two major types:
• Cash Dispensers – Most common ATMs which perform the basic
functions and give out cash to customers
• Cash Recyclers: These can give out cash as well as receive deposits
from customers
ATM (Automated Teller Machines)
Components:
• Card Reader. This reads account information that is stored on a debit card
(magnetic strip OR chip and pin). The data retrieved is passed on to a host
processor, which in turn is able to interpret the information and retrieve the
customer’s account information.
• Keypad. This allows customers to input the information they need to give. It
lets them input their personal identification or pin code, select what type of
transaction they want to make, and generally communicate with the ATM
software. Later models have a touch-screen for this function.
• Display screen. This allows customers to see each step of the process or
transaction they are doing.
ATM (Automated Teller Machines)
Components:
• Speaker. This allows the customer to hear when keys are being
pressed on the keypad, but it may also allow for additional voice
features on certain ATMs.
• Receipt printer. Although much of the process of an ATM is digital,
printed receipts are requested by many or most ATM customers. This
ATM part makes this possible.
• Cash dispenser (output bin). The main purpose of an ATM is for a
customer to acquire cash, so this is the most important part.
ATM (Automated Teller Machines)
Components:
• Input Bin. This part available on some ATMs, is used to receive cash and cheques
that are deposited by customers,
• Journal Printer. This printer is used to store and print all the activities that take
place on the ATM. It is a very useful feature as it is mostly used to audit and
follow activities in case anything goes wrong
• Cassettes. This is where the notes of cash are stored depending on their
classification (value) e.g 1000, 2000, 5000 etc.
• Reject bin. A bin that collects notes that have any fault.
• Cameras: Used to record the activities of the transaction in case of any case of
fraud
ATM (Automated Teller Machines)
Operation:
In operation, an ATM is a networked device going through 3 sets of connected
software:
• The ATM software, which manages all the hardware aspects of the ATM
itself and gives the user the interface through which to interact with he ATM
• The switching software, which acts as a bridge between the ATM
software/user and the bank.
• The core banking software (CBS), which holds all the information on the
accounts of the customer.
• The three work together to give service to the customer
ATM (Automated Teller Machines)
Pros:
• Any-time service
• Access from anywhere
• Ease of doing simple transactions like bills, top ups, transfer
Cons:
• Limitations on cash withdrawals
• Security issues
• Not available in remote areas (due to network availability)
• Requires constant power source
E-Business Application
• E-Business can be used in the modern business operations to
streamline business activities in so many ways.
• Some of the common activities enhanced by the application of e-
business include:
• E-Banking
• E-Tailing
• ATM Operations
• CRM – Customer Relationship Management
• BPO – Business Process Outsourcing
• Call Centre Management
CRM
• Business has changed from being transactional to
being relational
• CRM directly contributes towards customer benefits
and the growth of businesses and IT plays a very
critical role in identifying, acquiring, and retaining the
customers, and thereby managing a healthy
relationship with them
CRM
• Customer Relationship Management is the core
business strategy based on high quality customer data
and information technology that integrates internal
processes and functions, and external networks, to
create and deliver value to, and maintain a profitable
relationship with customers.
• The primary goal of CRM is to increase customer
loyalty and improve business profitability
CRM Objectives
• Improve Customer Satisfaction − CRM helps in customer satisfaction
as the satisfied customers remain loyal to the business and spread
good word about the business. This can be accomplished through
customer engagement via social networking sites, surveys, interactive
blogs, and various mobile platforms.
• Expand the Customer Base − CRM not only manages the existing
customers but also creates knowledge for prospective customers who
are yet to convert.
CRM Objectives
• Enhance Business Sales − CRM methods can be used to close more
deals, increase sales, improve forecast accuracy, and suggestion
selling. CRM helps to create new sales opportunities and thus helps in
increasing business revenue.
• Improve Workforce Productivity − A CRM system can create
organized manners of working for sales and sales management staff
of a business. The sales staff can view customer’s contact information,
follow up via email or social media, manage tasks, and track the
salesperson’s performance. The salespersons can address the
customer inquiries speedily and resolve their problems.
CRM Types
CRM systems, based on their prominent characteristics, are divided into four
basic types:
• Strategic CRM - Customer-centric, based on acquiring and maintaining
profitable customers
• Operational CRM - Based on customer-oriented processes such as selling,
marketing, and customer service.
• Analytical CRM - Based on the intelligent mining of the customer data and
using it tactically for future strategies.
• Collaborative CRM - Based on application of technology across organization
boundaries with a view to optimize the organization and customers.
CRM Types – Strategic CRM
• Strategic CRM is a type of CRM in which the business puts the
customers first. It collects, segregates, and applies information about
customers and market trends to come up with better value
proposition for the customer.
• The business considers the customers’ voice important for its survival.
Here the business constantly keeps learning about the customer
requirements and adapting to them.
CRM Types – Operational CRM
• Operational CRM is oriented towards business processes such as marketing,
selling, and services. It includes the Sales Force Automation, Marketing
Automation & Service Automation
a. Sales Force Automation - the application of technology to manage selling
activities and it includes modules such as product configuration, quotation &
proposal management, accounts management AND contact management.
b. Marketing Automation - involves market segmentation, campaigns
management, event-based marketing, and promotions
c. Service Automation - involves service level management, resolving issues or
cases, and addressing inbound communication e.g. IVR where a customer
can interact with automated service or be routed to an employee
CRM Types – Analytical CRM
• Analytical CRM is based on capturing, interpreting, segregating,
storing, modifying, processing, and reporting customer-related data.
It also contains internal business-wide data such as: 
• Sales Data (products, volume, purchasing history)
• Finance Data (purchase history, credit score) and, 
• Marketing Data (response to campaign figures, customer loyalty schemes
data). 
CRM Types – Collaborative CRM
• Collaborative CRM is an alignment of resources and
strategies between separate businesses for
identifying, acquiring, developing, retaining, and
maintaining valuable customers. It is employed in B2B
scenario, where multiple businesses can conduct
product development, market research, and
marketing jointly.
CRM Types – Collaborative CRM Cont’d
• Collaborative CRM enables smooth communication
and transactions among businesses. Though
traditional ways such as air mail, telephone, and fax
are used in communication, collaborative CRM
employs new communication systems such as chat
rooms, web forums, Voice over Internet Protocol
(VoIP), and Electronic Data Interchange (EDI).
E-Business Application
• Some of the common activities enhanced by the
application of e-business include:
• E-Banking
• E-Tailing
• ATM Operations
• CRM – Customer Relationship Management
• BPO – Business Process Outsourcing
• Call Centre Management
Business Process Outsourcing
• BPO is the act of transferring some of an
organization’s repeated non-core business processes
to an outside provider to achieve cost reductions
while improving service quality
• BPO involves outsourcing processes that are not core
to a company, however, are essential for smooth
operation of the company.
BPO
• Call centers and help desks are the most common
business process that gets outsourced
• Many call centers and help desks of many
multinational companies in developed countries are
being outsourced for low wages to countries like
Philippines & India.
BPO Processes
BPO deals mainly with non-core processes of an organization, such as:
1. Administrative support: Outsourcing of administrative support
functions includes data entry, document conversion, forms
processing, document scanning, indexing, secretarial tasks support,
etc.
2. Customer relationship management: Customer service outsourcing
includes outsourcing of functions such as customer support, order
taking, customer service, product support, technical help desk,
collections and market research.
BPO Processes – cont’d
3. Human resources and training: Human resources (HR) is one of the
most critical assets of a company and companies need to carry out
various tasks such as recruitment, training, retention, database
management, contract-worker management, etc., for their
employees. Carrying out these tasks through an internal HR
department is costly and diverts the attention of the management
from its core business issues. Hence, companies are now resorting
to HR outsourcing.
BPO Processes – cont’d
4. Payroll maintenance and other transaction
processing: This segment includes payroll, payment, check,
credit card and stock trade processing. Some processes
such as mortgage, loans and insurance claims processing
are also being outsourced.
5. Product development: Companies need to constantly
innovate to remain competitive in the market. With the
increasing specialization of expertise required to carry out
product development, companies choose to outsource
their R&D functions to vendors who have expertise in a
given field. 
BPO Processes – cont’d
6. Security: Companies have to search for new technologies and
employ qualified security professionals to keep their data secure
from theft. Maintaining these resources and implementing a strong
security policy is a difficult task which can be better handled by
experienced third party security agencies. Security outsourcing
involves management of investigative services, physical security,
electronic security systems, computer and network security, etc.
Advantages of BPO
• Wide options for Outsourcing: The developments in IT and
telecommunications infrastructure has enabled companies to transfer data
to any place in the world instantaneously at very little cost.
• Lowered operational costs: Companies are facing huge competition from
their competitors to provide better services, and at the same time lower
their costs, and BPO allows them to do that by partnering with external
specialized vendors like offshore BPO (e.g. India) for efficient operations.
• Little infrastructure for automation: IT has not reached 100% in
automating business processes and most business processes still need
human labor, therefore resorting to BPO, where human labor is cheap,
enables companies to maximize their return on investment (ROI)
Disadvantages of BPO
• Loss of control: Companies perceive the risk of losing control over the
operations of their processes. Also, if the employees in the vendor
firm leave the job, the buyer may be at risk.
• Financial instability of the vendor: If the vendor becomes financially
unstable in some years, the buyer will have to search another vendor;
the operations being at risk, if the search is not fast
• Loss of expertise: Customers may lose the expertise and knowledge
of carrying out the outsourced processes with time.
• Data security: Data confidential to the customer may be prone to
theft if the vendor firm does not have strong security policies.
E-Business Application
• Some of the common activities enhanced by the
application of e-business include:
• E-Banking
• E-Tailing
• ATM Operations
• CRM – Customer Relationship Management
• BPO – Business Process Outsourcing
• Call Centre Management
Call Centre
• A call center is an establishment used for the purpose
of receiving and transmitting a large volume of
requests from customers by telephone.
• A call center is run by a company that either offers
product support or can offer information to
consumers with questions. Outgoing calls for
telemarketing, product services, and debt collection
are also made at call centers.
Call Centre Technologies
Call centers require many different types of technology in order to continue to be
productive, such as:
• Speech recognition software
• Natural language processing
• Agent training software
• Intelligent call-back
• ACD – Automatic call distributor
• CTI – Computer telephony integration
• IVR – Interactive Voice Response
• Call Recording Systems
• Predictive dialer & Power Dialers
Predictive vs Power Dialers
• Power dialers are auto-dialers that automate the process of dialing a set
of numbers from a list, and once these calls are picked up by a person,
the dialer immediately connects that call to the free agents, who can
then speak to the person.
• A predictive dialers are auto-dialers that is able to mathematically
calculate when an agent is likely to become free to the next call, and
also when the next dialed number is likely to be picked up by a person.
Because of this ability to predict the timing beforehand, a predictive
dialer can start initiating calls to new numbers, even while all the agents
are still busy speaking to people on their earlier calls. Due to this a lot of
time can be saved, resulting in increased productivity.
Predictive vs Power Dialers
• The main difference between power dialers and predictive dialers is
that in power dialers a fresh call is started only when an agent finishes
the earlier call and becomes free to take the next call, while predictive
dialers start dialing before the agent actually becomes free.
CTI (Computer-Telephony Integration)
CTI is the use of computers to manage telephone calls. CTI applications
provide the ability to do one or more of the following:
• Authenticate callers. Using one of several standard methods, the
telephone number of the caller can be screened against a database.
• Recognize a voice, either for authentication or for message forwarding
• Using live, recorded voice, or touch-tone entered input, determine
how to process a call (for example, by forwarding it to the appropriate
person or department)
• Provide interactive voice response (IVR) to callers
CTI – Cont’d
• Match the number of a caller with a customer record and display
it for reference when talking to the caller
• Manage voice or video conferences
• Collect and display pending live calls or messages that have been
left by callers
• Receive fax messages and route them to appropriate fax
machines
• For outbound calling such as telemarketing, predial callers
ACD (Automatic Call Distributors)
• ACD is a tool commonly used in the telephony industry, found in any office
that handles a large volume of inbound calls whose primary purpose is to
disperse incoming calls to contact center agents or employees with specific
skills.
• The ACD system utilizes a rule based routing strategy, based on a set of
instructions that dictates how inbound calls are handled and directed.
• These rules are based on guiding a caller to any agent as fast as possible, but
other variables are added with the end goal of finding out why the customer
is calling.
• Matching and routing calls to the correct agent is a difficult task and is done
together with Interactive Voice Response CTI systems
Types of Call Centres
An outbound call centre - where a collection of call centre agents make outgoing calls to
prospective or existing customers, mostly using a predictive dialer so that large numbers of
calls can be made per hour.
The most common uses of outbound call centres are:
• Proactive customer service (e.g. informing of delays, problems, delivery arrangements, etc.)
• Sales calls to new (prospective) customers
• Renewals (sales calls to existing customers)
• Debt collection
• Customer satisfaction surveys
• Market research
• Appointment booking
Types of Call Centres – cont’d
• An inbound call centre – where agents exclusively or predominately
handle inbound calls (calls initiated by the customer), emails, texts,
and live chat inquiries
• Inbound call centres are mostly used for customer support and
technical support supplied by the call centre host organization