INTRODUCTION TO E-BUSINESS

Course outline

OVERVIEW OF ELECTRONIC
BUSINESS
 BUSINESS
 Organized effort of individuals to produce and sell for
profit, products and services that satisfy society
needs
 E-BUSINESS
- Conduct of automated business transactions by
means of electronic communication networks( via
the Internet/private networks) end – to – end
- The digital enabling of transactions and processes
within a firm involving IS under the control of the
firm .
 E-BUSINESS VS E-
COMMERCE

 E-commerce is a form of e-business

 Focus on buying and selling of products on
internet and the transfer of funds using digital
communications
 Conducted from a B2B 0r B2C perspective
 It does not include key business processes such
as CRM, SCM and ERP integration.
 E.g e-cart,
 E-business refers not only to information
exchanges related to buying and selling but also
to servicing customers, collaborating with
business partners, distributors and suppliers.
 Enables companies to link the internal and
external processes more efficiently
 Includes keeping key business processes like
SCM,CRM,ERP on web.
 UNIQUE FEATURES OF E-
COMMERCE TECHNOLOGY

 Ubiquity
 Global Reach
 Universal standards
 Interactivity
 Information density
 Personalization / Customization
 CHARACTERISTICS OF E-
BUSINESS
 Collaborative product development
 Collaborative planning, forecasting & replenishment
 Procurement & Order Management
 Operations & logistics
 COLLABORATIVE PRODUCT
DEVELOPMENT

 Fastest growing technology in the engineering –

manufacturing market
 Implemented across industries like automotive,
aerospace, office equipment, industrial
machinery, etc.
 Helps in making a product within limited time
while maintaining quality and reducing cost
 Integrates the design and test cycles of the
company with that of the suppliers
 COLLABORATIVE
PLANNING, FORECASTING
& REPLENISHMENT
 Manufacturers , distributors and retailers work
together to plan, forecast and replenish products.
 Collaboration in the form of sharing information
 Includes sales forecasts, base inventory requirements,
manufacturing & logistics lead time etc.
 Collect market intelligence on product information,
store promotional programs and share the
information in real time over digital networks
 It lowers supply chain cycle times, improve customer
service, improve supply chain inventory levels and
lower inventory cost
 PROCUREMENT & ORDER
MANAGEMENT

 Also known as e-procurement

 Companies use an integrated electronic order
process to increase efficiencies in their
purchasing operations
 Includes controlling the supply base, negotiating
effective buying preferences and streamlining
the entire procurement process
 OPERATIONS &
LOGISTICS

 Logistics : part of supply chain process that plans,

implements, and controls the efficient and
effective flow of storage of goods, services and
related information from the point of origin to
the point of consumption.
 In e-business era it is about sharing of critical &
timely data on the movement of goods.
 It eliminates cost during purchase order, sales
order and shipping information
 ELEMENTS OF AN E-
BUSINESS SOLUTION
Customers Internet

CRM Web Selling Finance/accounting/

auditing
ordering
management control

Order
purchasing production delivery
fulfillment

Supply chain Distributors

E-markets, auctions, suppliers

intermediaries internet
partners
 CRM SYSTEMS
 Front office systems that help the organization deal
directly with the customers
 Includes 3 categories of user applications:

1. Customer facing applications – enable customers to

order products and services and obtain customer
service and support

2. Sales force facing applications- automate some of the

company’s sales and sales force management functions

3. Management facing – calculations and reports, business

models, competitors, industry trends etc.
 ERP SYSTEMS
 Systems that integrate and automate many business
practices like manufacturing, logistics, distribution,
inventory, shipping, invoicing and accounting.
 Aid in the control of many business activities like sales,
delivery, billing, production, inventory management and
HRM
 Often called back office systems.
 Designed around 4 primary business processes :
-- Production
-- Buying a product
--Sales of products & services
-- Costing, paying bills and collecting
 SCM

 Network of facilities and distribution options that

performs the functions of procurement of
materials, transformation of these materials into
intermediate and finished products and
distribution of these products to the customers
 It has 3 main parts : supply, manufacturing and
distribution
 KNOWLEDGE
MANAGEMENT

 Relates to identification and analysis of available

and required knowledge assets and related
processes.
 It includes information and experience
 Knowledge assets include knowledge regarding
markets, products, processes, technologies and
organizations that a business owns or needs to
own.
 E-MARKETS

 It is an electronic meeting place for multiple

buyers and sellers
 E-BUSINESS ROLES

 2 principal roles :
1. Buyer – Organizations that purchase goods and
services directly from suppliers . They review product
information, receive customer service, ordering
services, make orders, learn order status and make
payments
2. Supplier – Organizations that market and sell goods
or services directly to buyers or indirectly through
diverse sales channels like web,
3. Additional Role of Market makers who are third party
organizations that run e-markets.
 CHALLENGES

 Managing multiple selling channels, based on various

technologies, protocols, data formats and standard
business processes
 To have the ability to take multiple type of orders
through the various selling channels
 To have the ability to differentiate and customize
products and services from other suppliers and
offering them through the various selling channels
 To have the ability to adapt and grow the e-business
without incurring dramatic technology changes,
organization restructuring and new investments
 PRINCIPLES FOR E-
BUSINESS STRATEGY AND
SOLUTIONS
 Empowering suppliers & buyers – e-business
solution should provide multiple selling channels
at low investment to increase the reach and
increase revenue opportunity. Similarly buyers
should also be able to pick & choose from
various suppliers.
 Also it should enable interoperation of a
supplier’s internal systems with that of buyers,
trading and distribution partners.
 Enabling suppliers of all sizes
 E-BUSINESS
REQUIREMENTS
1. Identify /measure quantifiable business objectives -
measure the impact /feasibility of e-business

2. Ensure organizational/operational flexibility - The

organization will have better business transaction
growth, expanded markets, increased information
access which will be major change factors.

3. Rethink entire company supply chains – To integrate

better with the suppliers and customers , share
information, inter-link processes and outsource
manufacturing logistics systems.

4. Transform the company into a process centric one -

5. Define business processes

6. Understand security requirements

7. Align business organizations with a flexible IT

architecture

8. Establish ubiquity within standards

 IMPACTS OF E-BUSINESS
 Improved operational efficiency & productivity
 Reduction in operating costs & costs of goods & services
 Improved competitive position
 Penetration into new markets through new channels
 Improved communication, information and knowledge
sharing
 Harmonization and standardization of processes
 Improved internal information access
 Improved relationships with suppliers and improved
customer service
 INHIBITORS OF E-
BUSINESS

 Management/strategy issues
 Cost/financing issues
 Security and trust issues
 Legal issues
 Technological concerns
 MANAGEMENT/STRATEGY
ISSUES

 E-business strategy
 Organizational changes required by e-business
 Management attitudes & organizational
inflexibility
 COST/FINANCING
ISSUES

 Costs on implementation of e-business

 Calculating the return on investment
 SECURITY & TRUST
ISSUES

 Security
 Trust
 New partnership loyalties

--- Legal issues & Technological concerns

 FUNDAMENTAL MODELS OF
E-BUSINESS
 BUSINESS TO BUSINESS (B2B )

This model Matches buyers and sellers to Exchange Goods and Services

B2B website focus on providing solution to various industries such as

banking ,automotive industries.

 BUSINESS TO CONSUMER (B2C)

The e-Business that Adopts B2C Model sell their products and services
directly to individual Consumers. www.febmail.com

This model provide

 Security of online payment

•CONSUMER-TO-CONSUMER (C2C)
CONSUMERS SELL DIRECTLY TO OTHER CONSUMERS
• C2C websites enable the sale and purchase of products and services
B/W Individual customers.

• C2C business model is an online auction site.

• eBay. COM pioneered C2C auctions.

•GOVERNMENT TO CITIZEN (G2C)

• To Improve public services

• People Can avail themselves of various benefits provided by
the Government.
• CITIZEN-TO-GOVERNMENT (C2G)
It Facilitate citizens to interact with the Government.

E.g. Pay Tax online through government websites.

• GOVERNMENT TO GOVERNMENT (G2G)

It is also know as e-Administration
The main aim of G2G is cutting cost and improve government processes .
This involves connecting all government offices, departments and
headquarters.
 PEER TO PEER (P2P)

- Use of pear to pear technology, which enables internet users to share

files and computer resources directly without having to go through a
central web-server.

- Eg. Napster, BitTorrent

 SUMMARY OF E-BUSINESS MODELS

Model Description Examples

Sells products or services directly to
B2C consumers
Fabmall.com

Sells products or services to other

businesses or brings multiple buyers
B2B and sellers together in a central
Metalsite.com
marketplace
Businesses selling to local, state and
G2B central governments
iGOV.com

C2C Consumers sell directly to consumers EBay. COM

Consumers fix price on their own, Makemytrip.co

C2B which businesses accept or decline m
 WEB 2.0

Web 1.0

Internet started as a network to support email and file transfers. The

web started as a way to use the internet to display simple pages and
allow the user to navigate among the pages by linking them together

Web 2.0

Evolved. Now users can create, edit, distribute content to millions of

other users. Build online communities, bookmarks etc.
E.g. You Tube, MySpace, Google etc.