代写 Introduction to Electronic Commerce HC3152 Ebusiness A

代写 Introduction to Electronic Commerce HC3152 Ebusiness Applications Chapter 1 Introduction to Electronic Commerce HC3152 Ebusiness Applications Week 1 Holmes 2011 Learning Objectives In this chapter, you will learn about: What electronic commerce is and how it has evolved into a second wave of growth Why companies concentrate on revenue models and the analysis of business processes instead of business models when they undertake electronic commerce initiatives How economic forces have created a business environment that is fostering the second wave of electronic commerce Holmes 2011 Learning Objectives (cont’d.) How businesses use value chains and SWOT analysis to identify electronic commerce opportunities The international nature of electronic commerce and the challenges that arise in engaging in electronic commerce on a global scale Holmes 2011 Electronic Commerce: The Second Wave Electronic commerce history Mid-1990s to 2000: rapid growth “Dot-com boom” followed by “dot-com bust” 2000 to 2003: overly gloomy news reports 2003: signs of new life •Sales and profit growth return •Electronic commerce growing at a rapid pace •Electronic commerce becomes part of general economy 2008 general recession •Electronic commerce hurt less than most of economy Second wave underway 2 Holmes 2011 5 Electronic Commerce and Electronic Business  Electronic commerce  Shopping on the Web  Businesses trading with other businesses  Internal company processes  Broader term: electronic business (e-business)  Electronic commerce includes:  All business activities using Internet technologies • Internet and World Wide Web (Web) • Wireless transmissions on mobile telephone networks  Dot-com (pure dot-com)  Businesses operating only online Holmes 2011 6 Categories of Electronic Commerce  Business-to-consumer (B2C) Consumer shopping on the Web  Business-to-business (B2B): e-procurement  Transactions conducted between Web businesses  Supply management (procurement) departments • Negotiate purchase transactions with suppliers  Business processes Using Internet technologies to support organisation selling and purchasing activities  Consumer-to-consumer (C2C)  Business-to-government (B2G) Holmes 2011 7 FIGURE 1-1 Elements of electronic commerce Holmes 2011 8 Categories of Electronic Commerce (cont’d.)  Elements of electronic commerce Relative sizes of elements • Rough approximation Dollar volume and number of transactions • B2B much greater than B2C Number of transactions • Supporting business processes greater than B2C and B2B combined 3 Holmes 2011 9 Categories of Electronic Commerce (cont’d.)  Activity  Task performed by a worker in the course of doing his or her job May or may not be related to a transaction  Transaction: exchange of value  Purchase, sale, or conversion of raw materials into finished product  Involves at least one activity  Business processes Group of logical, related, sequential activities and transactions Holmes 2011 10 Categories of Electronic Commerce (cont’d.)  Web helping people work more effectively  Telecommuting (telework)  Consumer-to-consumer (C2C)  Individuals buying and selling among themselves • Web auction site C2C sales included in B2C category • Seller acts as a business (for transaction purposes)  Business-to-government (B2G)  Business transactions with government agencies • Paying taxes, filing required reports  B2G transactions included in B2B discussions Holmes 2011 11 FIGURE 1-2 Electronic commerce categories Holmes 2011 12 The Development and Growth of Electronic Commerce  People engaging in commerce:  Adopt available tools and technologies  Internet Changed way people buy, sell, hire, organise business activities • More rapidly than any other technology  Electronic Funds Transfers (EFTs) Wire transfers  Electronic transmissions of account exchange information • Uses private communications networks 4 Holmes 2011 13 The Development and Growth of Electronic Commerce (cont’d.)  Electronic Data Interchange (EDI)  Business-to-business transmission • Computer-readable data in standard format  Standard transmitting formats benefits • Reduces errors • Avoids printing and mailing costs • Eliminates need to reenter data  Trading partners  Businesses engaging in EDI with each other  EDI pioneers (General Electric, Sears, Wal-Mart) • Improved purchasing processes and supplier relationships Holmes 2011 14 The Development and Growth of Electronic Commerce (cont’d.)  EDI pioneers problem High implementation cost • Expensive computer hardware and software • Establishing direct network connections to trading partners or subscribing to value-added network  Value-added network (VAN) • Independent firm offering EDI connection and transaction-forwarding services • Ensure transmitted data security • Charge fixed monthly fee plus per transaction charge Gradually moved EDI traffic to the Internet • Reduced EDI costs Holmes 2011 15 The Dot-Com Boom, Bust, and Rebirth  1997 to 2000 irrational exuberance  12,000 Internet-related businesses started  $100 billion of investors’ money  5,000+ companies went out of business or acquired  2000 to 2003  $200 billion invested  Fueled online business activity growth rebirth Online B2C sales growth continued more slowly  2008-2009 recession  B2C and B2B increasing growth rates continue Driving force: people with Internet access increasing Holmes 2011 16 FIGURE 1-3 Actual and estimated online sales in B2C and B2B categories 5 Holmes 2011 17 The Second Wave of Electronic Commerce Four waves based on the Industrial Revolution First and second wave characteristics Regional scope •First wave: United States phenomenon •Second wave: international Start-up capital •First wave: easy to obtain •Second wave: companies using internal funds Internet technologies used •First wave: slow and inexpensive (especially B2C) •Second wave: broadband connections Holmes 2011 18 The Second Wave of Electronic Commerce (cont’d.) First and second wave characteristics (cont’d.) Internet technology integration •First wave: bar codes, scanners •Second wave: Radio Frequency Identification (RFID) devices, smart cards, biometric technologies Electronic mail (e-mail) use •First wave: unstructured communication •Second wave: integral part of marketing, customer contact strategies Revenue source •First wave: online advertising (failed) •Second wave: Internet advertising (more successful) Holmes 2011 19 The Second Wave of Electronic Commerce (cont’d.) First and second wave characteristics (cont’d.) Digital product sales •First wave: fraught with difficulties (music industry) •Second wave: fulfilling available technology promise •Mobile telephone based commerce (mobile commerce or m-commerce) •Smart phone technology enabling mobile commerce •Web 2.0: making new Web business possible Business online strategy •First wave: first-mover advantage •Second wave: businesses not relying on first-mover advantage Holmes 2011 20 FIGURE 1-4 Key characteristics of the first two waves of electronic commerce 6 Holmes 2011 21 Business Models, Revenue Models, and Business Processes Business model Set of processes combined to achieve company goal of yielding profit Electronic commerce first wave Investors sought Internet-driven business models •Expectations of rapid sales growth, market dominance Saw copying of successful “dot-com” business models •Michael Porter argued business models did not exist Holmes 2011 22 Business Models, Revenue Models, and Business Processes (cont’d.) Instead of copying model, examine business elements Streamline, enhance, replace with Internet technology driven processes Revenue model used today Specific collection of business processes •Identify customers •Market to those customers •Generate sales Helpful for classifying revenue-generating activities •Communication and analysis purposes Holmes 2011 23 Focus on Specific Business Processes Companies think in terms of business processes Purchasing raw materials or goods for resale Converting materials and labor into finished goods Managing transportation and logistics Hiring and training employees Managing business finances Identify processes benefiting from e-commerce technology Uses of Internet technologies Improve existing business processes, identify new business opportunities, adapt to change Holmes 2011 24 Role of Merchandising Merchandising Combination of store design, layout, product display knowledge Salespeople skills Identify customer needs •Find products or services meeting needs Merchandising and personal selling Difficult to practice remotely Web site success Transfer merchandising skills to the Web •Easier for some products than others 7 Holmes 2011 25 Product/Process Suitability to Electronic Commerce Classifications Depend on available technologies’ current state •Change as new e-commerce tools emerge FIGURE 1-5 Business process suitability to type of commerce Holmes 2011 26 Product/Process Suitability to Electronic Commerce (cont’d.) Commodity item: well suited to e-commerce selling Product or service hard to distinguish from same products or services provided by other sellers Features: standardised and well known Price: distinguishing factor Consider product’s shipping profile Collection of attributes affecting how easily that product can be packaged and delivered Note value-to-weight ratio •DVD: good example •Expensive jewelry: high value-to-weight ratio Holmes 2011 27 Product/Process Suitability to Electronic Commerce (cont’d.) Easier-to-sell products have: Strong brand reputation (Kodak camera) Appeal to small but geographically diverse groups Traditional commerce Better for products relying on personal selling skills Combination of electronic and traditional commerce Business process includes both commodity and personal inspection items Holmes 2011 28 Advantages and Disadvantages of Electronic Commerce E-commerce increases sales and decreases costs Virtual community: gathering of people online Using Web 2.0 technologies E-commerce buyer opportunities Increases purchasing opportunities Identifies new suppliers and business partners Efficiently obtains competitive bid information •Easier to negotiate price and delivery terms Increases speed, information exchange accuracy Wider range of choices available 24 hours a day •Immediate access to prospective purchase information 8 Holmes 2011 29 Advantages and Disadvantages of Electronic Commerce (cont’d.) Benefits extend to general society welfare Lower costs to issue and secure: •Electronic payments of tax refunds •Public retirement •Welfare support Provides faster transmission Provides fraud, theft loss protection •Electronic payments easier to audit and monitor Reduces commuter-caused traffic, pollution •Due to telecommuting Products and services available in remote areas Holmes 2011 30 Disadvantages of Electronic Commerce Poor choices for electronic commerce Perishable foods and high-cost, unique items Disadvantages will disappear when: E-commerce matures •Becomes more available to and accepted by general population Critical masses of buyers become equipped, willing to buy through Internet •Online grocery industry example Holmes 2011 31 Disadvantages of Electronic Commerce (cont’d.) Additional problems Calculating return on investment Recruiting and retaining employees Technology and software issues Cultural differences Consumers resistant to change Conflicting laws Holmes 2011 32 Economic Forces and Electronic Commerce Economics Study how people allocate scarce resources •Through commerce and government actions Commerce organisations participate in markets Potential sellers come into contact with buyers Medium of exchange available (currency or barter) Organisation hierarchy (flat or many levels) Bottom level includes largest number of employees Pyramid structure Transaction costs Motivation for moving to hierarchically structured firms 9 Holmes 2011 33 Transaction Costs  Total costs a buyer and seller incur While gathering information and negotiating purchase-and-sale transaction  Includes: • Brokerage fees and sales commissions • Cost of information search and acquisition  Sweater dealer example (Figure 1-6) Holmes 2011 34 FIGURE 1-6 Market form of economic organisation Holmes 2011 35 Markets and Hierarchies  Coase’s analysis of high transaction costs Hierarchical organisations formed • Replace market-negotiated transactions • Strong supervision and worker-monitoring elements  Sweater example (Figure 1-7)  Oliver Williamson (extended Coase’s analysis) Complex manufacturing, assembly operations • Hierarchically organised, vertically integrated Manufacturing innovations increased monitoring activities’ efficiency and effectiveness Holmes 2011 36  Strategic business unit (business unit) One particular combination of product, distribution channel, and customer type  Exception to hierarchy trend Commodities FIGURE 1-7 Hierarchical form of economic organisation 10 Holmes 2011 37 Using Electronic Commerce to Reduce Transaction Costs Electronic commerce Change vertical integration attractiveness Change transaction costs’ level and nature Example: employment transaction Telecommuting •May reduce or eliminate transaction costs Holmes 2011 38 Network Economic Structures Neither market nor hierarchy Strategic alliances (strategic partnerships) Coordinate strategies, resources, skill sets Form long-term, stable relationships with other companies and individuals •Based on shared purposes Strategic partners Come together for specific project or activity Form many intercompany teams •Undertake variety of ongoing activities Holmes 2011 39 Network Economic Structures (cont’d.)  Network organisations Well suited to information-intensive technology industries Sweater example •Knitters organise into networks of smaller organisations •Specialise in styles or designs Electronic commerce makes such networks easier to construct and maintain •Will be predominant in the near future Manuel Castells predicts economic networks will become the organising structure for all social interactions Holmes 2011 40 FIGURE 1-8 Network form of economic organisation 11 Holmes 2011 41 Network Effects Activities yield less value as consumption amount increases Law of diminishing returns •Example: hamburger consumption Networks (network effect) Exception to law of diminishing returns •More people or organisations participate in network •Value of network to each participant increases Example: telephone Holmes 2011 42 Using Electronic Commerce to Create Network Effects E-mail account example Provides access to network of people with e-mail accounts If e-mail account is part of smaller network •E-mail generally less valuable Internet e-mail accounts Far more valuable than single-organisation e-mail •Due to network effect Need way to identify business processes Evaluate electronic commerce suitability •For each process Holmes 2011 43 Identifying Electronic Commerce Opportunities Focus on specific business processes Break business down Series of value-adding activities •Combine to generate profits, meet firm’s goal Commerce conducted by firms of all sizes Firm Multiple business units owned by a common set of shareholders or company Industry Multiple firms selling similar products to similar customers Holmes 2011 44 Strategic Business Unit Value Chains Value chain Organising strategic business unit activities to design, produce, promote, market, deliver, and support the products or services Michael Porter includes supporting activities •Human resource management and purchasing Strategic business unit primary activities Identify customers, design, purchase materials and supplies, manufacture product or create service, market and sell, deliver, provide after-sale service and support 12 Holmes 2011 45 Strategic Business Unit Value Chains (cont’d.)  Strategic business unit primary activities (cont’d.)  Importance depends on: • Product or service business unit provides • Customers  Central corporate organisation support activities  Finance and administration Human resource  Technology development Holmes 2011 46  Left-to-right flow Does not imply strict time sequence FIGURE 1-9 Value chain for a strategic business unit Holmes 2011 47 Industry Value Chains  Examine where strategic business unit fits within industry  Porter’s value system Describes larger activities stream into which particular business unit’s value chain is embedded  Industry value chain refers to value systems  Delivery of product to customer Use as purchased materials in its value chain  Awareness of businesses value chain activities  Allows identification of new opportunities Useful way to think about general business strategy Holmes 2011 48 FIGURE 1-9 Value chain for a strategic business unit 13 Holmes 2011 49 SWOT Analysis: Evaluating Business Unit Opportunities  SWOT analysis  Strengths, weaknesses, opportunities, and threats  Consider all issues systematically  First: look into business unit • Identify strengths and weaknesses  Then: review operating environment • Identify opportunities and threats presented  Take advantage of opportunities  Build on strengths  Avoid threats Compensate for weaknesses Holmes 2011 50 FIGURE 1-11 SWOT analysis questions Holmes 2011 51 FIGURE 1-12 Results of Dell’s SWOT analysis Holmes 2011 52 International Nature of Electronic Commerce  Internet connects computers worldwide  When companies use Web to improve business process:  They automatically operate in global environment  Key international commerce issues  Trust Culture  Language Government  Infrastructure 14 Holmes 2011 53 Trust Issues on the Web Important to establish trusting relationships with customers Rely on established brand names Difficult for online businesses Anonymity exists in Web presence Banking example: browsing site’s pages •Difficult to determine bank size or how well established Business must overcome distrust in Web “strangers” Holmes 2011 54 FIGURE 1-13 This classic cartoon from The New Yorker illustrates anonymity on the Web Holmes 2011 55 Language Issues Business must adapt to local cultures “Think globally, act locally” Provide local language versions of Web site Customers more likely to buy from sites translated into own language 50 percent of Internet content in English Half of current Internet users do not read English •By 2015: 70% of e-commerce transaction will involve at least one party outside of the United States Languages may require multiple translations Separate dialects Holmes 2011 56 Language Issues (cont’d.) Large site translation may be prohibitive Decided by corporate department responsible for page content Mandatory translation into all supported languages Home page All first-level links to home page High priority pages to translate Marketing, product information, establishing brand Use translation services and software Human translation: key marketing messages Software: routine transaction processing functions 15 Holmes 2011 57 Cultural Issues Important element of business trust Anticipating how the other party to a transaction will act in specific circumstances Culture Combination of language and customs Varies across national boundaries, regions within nations Personal property concept •Valued in North America and Europe (not Asia) Cultural issue example Virtual Vineyards (now Wine.com) Holmes 2011 58 Cultural Issues (cont’d.) Subtle language and cultural standard errors General Motors’ Chevrolet Nova automobile Baby food in jars in Africa Select icons carefully Shopping cart versus shopping baskets, trolleys Hand signal for “OK”: obscene gesture in Brazil Dramatic cultural overtones India: inappropriate to use cow image in cartoon Muslim countries: offended by human arms or legs uncovered White color (purity versus death) Holmes 2011 59 Cultural Issues (cont’d.) Online business apprehension Japanese shoppers’ unwillingness to pay by credit Softbank Devised a way to introduce electronic commerce to a reluctant Japanese population Holmes 2011 60 Culture and Government Online discussion inhospitable to cultural environments Government controls in some cultures Unfettered communication not desired Unfettered communication not considered acceptable •Denounced Internet material content Unrestricted Internet access forbidden •Filter Web content Regularly reviews ISPs and their records Impose language requirements 16 Holmes 2011 61 Culture and Government (cont’d.) Internet censorship Restricts electronic commerce Reduces online participant interest levels China Wrestling with issues presented by the growth of the Internet as a vehicle for doing business Created complex set of registration requirements and regulations governing any business engaging in electronic commerce Regularly conducts reviews of ISPs and their records Strong cultural requirements finding their way into the legal codes that govern business conduct Holmes 2011 62 Infrastructure Issues Internet infrastructure Computers and software connected to Internet Communications networks’ message packets travel Infrastructure variations and inadequacies exist Outside United States Government-owned industry •Heavily regulated High local telephone connection costs •Affect buying online behavior International orders: global problem No process to handle order and paperwork Holmes 2011 63 Infrastructure Issues (cont’d.) Business face challenges posed by variations and inadequacies in the infrastructure supporting the Internet throughout the world Local connection costs Inability to handle order Freight forwarder Arranges international transactions’ shipping and insurance Customs broker Arranges tariff payment and compliance Holmes 2011 64 Infrastructure Issues (cont’d.) Bonded warehouse Secure location Holds international shipments until customs requirements or payments satisfied Handling international transactions paperwork Annual cost: $800 billion Software automates some paperwork •Countries have own paper-based forms, procedures •Countries have incompatible computer systems See Figure 1-14: complex information flows 代写 Introduction to Electronic Commerce HC3152 Ebusiness Applications Holmes 2011 65 FIGURE 1-14 Parties involved in a typical international trade transaction Holmes 2011 66 Summary  Electronic commerce  Application of new Internet and Web technologies • Helps individuals, businesses, other organisations conduct effective business  Adopted in waves of change • First wave ended in 2000 • Second wave focuses on improving specific business processes  Technology improvements Create new products and services  Improved promotion, marketing, delivery of existing offerings Holmes 2011 67 Summary (cont’d.)  Technology improvements (cont’d.)  Improve purchasing and supply activities  Identify new customers Operate finance, administration, human resource management activities more efficiently Reduce transaction costs Create network economic effects • Leads to greater revenue opportunities  Electronic commerce  Fits into markets, hierarchies, networks Holmes 2011 68 Summary (cont’d.)  Value chains Occur at business unit, industry levels  Value chains and SWOT analysis  Tools to understand business processes • Analyse suitability for electronic commerce implementation  Key international commerce issues  Trust Culture and language Government  Infrastructure
代写 Introduction to Electronic Commerce HC3152 Ebusiness Applications