Electronic Commerce and the Virtual Enterprise. Session 1:. Defining Electronic Commerce and The Network Economy. Electronic Commerce . “Electronic Commerce has generated over $1.2 billion in wealth in the past 18 months” -Al Gore. How is this possible?. Electronic Commerce.
Defining Electronic Commerce and
The Network Economy
“Electronic Commerce has generated over $1.2 billion
in wealth in the past 18 months”
How is this possible?
According to a recent survey, 66% felt the computer
was the most significant invention of the 20th century.
The airplane was 2nd at 18%
Also, more people believe that Bill Gates (45%) has a
greater impact on their day-to-day lives than Bill Clinton (44%)
Volchok Computing did a recent study
-only 23% of senior execs at Fortune 1000 companies
could explain the purpose of a modem while 93% of
6th graders got it right
-98% of the 6th graders knew the Internet was not
owned by anyone, 68% of the execs thought some
corporation ran it
-23% of the execs thought the Internet was part of Microsoft
Increasingly value is found not in tangible assets such as
products but in intangible assets such as branding, customer
relationship, supplier integration and the aggregation of key
Number of web users world-wide increased by 55%
Number of hosts rose by 46%
Number of web servers increased by 128%
Number of new web address registrations rose by 137%
Dell’s online sales more than doubled in 1998 to
$14 million per day. Last quarter sales were $18 m/day
1st quarter 1999 Travelocity’s sales grew to $128 m - 156%
increase over same period a year earlier
Quicken mortgage arranged $400m in loans in 1Q99 versus
$600 m for all of 1998
In early 1998 forecasters were suggesting that business-to-business
e-commerce might rise to $300 billion by 2002. Most now consider
that estimate to be too low.
Forrester suggests b-b will reach $1.3 trillion by 2003
EVERY estimate of e-commerce volume and growth has been LOW
-Hollywood SX www.hsx.com
-Voice Recognition 888-573-8255 Jupiter
-Bus Call www.buscall.com
-Online cameras events.exploratorium.edu/CAM1/index.html
-LA Traffic traffic.maxwell.com/la/
Is it technology?
Is it a process?
Is is a methodology?
ELECTRONIC FUNDS TRANSFER
ELECTRONIC DATA INTERCHANGE
ELECTRONIC BULLETIN BOARDS
INTERNET / WWW
CONTINUOUS ACQUISITION AND LIFE-CYCLE SUPPORT
JUST IN TIME
VENDOR MANAGED INVENTORIES
Communications: the delivery of information, products
services, or payments via telephone lines, computer
networks, or any other means
Business Process: the application of technology toward
the automation of business transactions and workflows
Service: a tool that addresses the desire of firms, consumers,
and management to cut service costs while improving the
quality of goods and increasing the speed of service delivery
Online: provides the capability of buying and selling
products and information on the Internet and other online
Key Elements of our definitions:
-EC is NOT just technology
-Technology applied to a business problem so that information is captured and exchanged in digital or electronic formats.
Technology is certainly integral to any definition of EC
“Good Technology that is accepted by both business
and society as a whole stands an excellent change of
changing the rules”
-Jeff Harrow, Compaq
How is Electronic Commerce different from the
Information Systems function in an enterprise?
“EC endeavors to improve the execution of business
transactions over various networks” - Kalakota & Whinston
Information Systems manage information as a resource
E-commerce concerns itself with the transaction
E-business is everything before and after the sale
Let’s look at a model for E-business
EmployeesA Model for E-business
Supply Chain Mgt
Enterprise Resource Planning
Customer Relationship Mgt
Selling Chain Mgt
This is my Model for this course
Let’s talk through each
As the virtual corporation emerges we begin to think
of moving towards an economy based on the Network.
What does that mean???
Some argue that the very nature of the firm will
change - do we need to organize resources in the
same way that we have?
The digital revolution gets all the headlines these days.
But turning slowly beneath the fast-forward turbulence,
steadily driving the gyrating cycles of cool technogadgets
and gotta-haves, is a much more profound revolution - the
-Kevin Kelly, New Rules for the Networked Economy
What’s the value of a single Fax machine?
As the number of nodes in a network increases arithmetically,
the value of the network increases exponentially. Adding
a few more members can dramatically increase value.
Value is derived from plentitude - not scarcity!
The fate of individual corporations is not dependent on their
own merits but also on the fate of their neighbors, their allies,
Networks churn - sustainable dis-equilibrium - quote from Kelly
Donald Hicks of UT studied the half-life of Texas businesses
for the past 22 years
-Their longevity has dropped by 1/2 since 1970
-Number of jobs growing faster than ever
-Wages at highest point and growing
“the vast majority of the employers on which Texans will depend
in the year 2026 - or even 2006 - do not yet exist”
What are the implications for us?
Change is constant
Planning horizons shorten
Education is continuous
What was total e-commerce in 1990?
What triggered the growth?
We will discuss many technologies but the Internet will be central
Jack Welch - The Internet is priority 1, 2, 3, and 4 for GE
Clearly the Internet has emerged as a viable business platform
For now the web page is: acasun.eckerd.edu/~duffja
1. Complete the matrix from the previous page
2. Read the Whitehouse position paper on ecommerce
3. Read New Rules for the Digital Economy
4. Macro-Effects of E-commerce
5. Send me an email - [email protected]
6. Read 1 & 2 in the text when available