Introduction to Internet Business Systems

1. Introduction to Internet Business Systems Module 2 INBS 510 B 2 B is the Word! Business 2 Business Models, Values, Future Anna Story- Instructor

2. EDI Electronic data interchange ERP Enterprise resource planning KM Knowledge management CRM Customer relationship management EIP Enterprise information portal SCM Supply chain management EAI Enterprise applicaton intergration MRO- most common Maintenance repair operations RFQ Request for quote A host of acronyms

3. Relationships Size Velocity Integration Technology Partners uptime Security Flexibility Bottom line Rules of E- Business PC Magazine June 21, 2000

4. Technology is cause and driver Ability to streamline information is the cost effective value You have to throw out the old business design Create flexible outsourcing for cost and customer satisfaction Listen to customers and become the cheapest, most familiar or best Use technology for every aspect Create E-B Community Develop Strong leadership strategy More Rules? Kalakota and Robinson 2000

5. Integrate Integrate Integrate • FedEx-proactive transformation • Merged with Caliber Logistics • Obtain the IT system • The warehouse, fullfillment and shipping for any company • Partner with National Semiconductor • Dedicated line to FedEx for orders • fedEx houses inventory, ships, cycle time

6. Future Shock & The Innovator’s Dilemna • Alvin Toffler in Future Shock stated “we do nothing at all, do not respond quickly or effectively enough in the face of demanding change” • Clayton Christensen in The Innovators Dilemna “ disruptive technologies are initially rejected by mainstream firms”

7. Major Trends Driving E-Business • Consumer trends • Services /processes • Organizational trends • Enterprise technology trends

8. B2B Broad Spectrum Applications • Product- specifications, prices and sales history • Customer- sales history and forecast • Supplier- product line, lead time, sales terms and conditions • Product process- capacities, commitments and plans • Transportation- carriers, lead times, costs

9. B2B apps…cont. • Inventory- levels, carrying costs, locations • Supply chain partners- key contacts, partner’s roles and responsibilites and schedules • Competitor- benchmarking, competitive product offerings, market share • Sales and marketing- point of sale, promotions • Supply chain process and performance- process descriptions, performance measures, quality, delivery time, and customer satisfaction

10. Supply Chain Management “ the coordination of order generation, order taking, and order fulfillment and distribution of products, services or information” Kalakota and Whinston, 1997 B2B E-business contributes to lower purchase cost, reduced inventory, efficiencies, and decreased sales and marketing costs.

11. Link manufacturers, retailers, customers and suppliers Streamline the flow Manage demand and sourcing & globalization Customer service, growth and revenue Knowledge management More responsive to to consumers and the need to reduce costs to maintain competitive edge eSupply Chain Trends Integrate

12. Predominent Industry Sectors • Computing electronics • Motor vehicles • Petrochemicals • Utilities • Paper/office supplies • Shipping/warehouse • Food/agriculture

13. Supply Chain Components • Upstream • suppliers • Internal • Processing • Packaging • Downstream • Distributors • customers

14. Procurement Approval cycle Create requisition PO-Approved Select Product Submit order Supplier Fulfillment To recipient receiving $$$ Ship Accounts payable

15. SCM- Distributors, Vendors and Shipment Providers • Fulfillment – JIT inventory • How does www.dell.com do it? • Some Solution providers • www.changepoint.com/index2.html • www.evolve.com • And of course www.i2.com btw you got to see their Flash Intro!!!

16. Management control Level of empowerment Online product selection Electronic ordering Application integration Information and reporting www.ariba.com http://www.ibm-i2-ariba.com/us1/ ORMS –operating resource mgmt Eliminates eternal paper chase First to market with integrated suite of applications Production related goods Non-production related goods E-Procurement : Evaluate

17. E-procurement • www.grainger.com • A distributor • www.stapleslink.com • Corporations open accounts and receive discounts on orders • www.buyingchain.com

18. Benefits of E-Procurement • Reduced procurement labor • Reduced materials cost • Redeployment of staff involved in procurement • Reducing manual works • Reduced cycle time • Automatic reconciliation of invoices with purchase orders • Discovering new suppliers

19. E-Procurement applications • Buy-side desktop requisitioning • Approval routing and purchasing • On intranet first for permission • Buy-side centralized procurement • Managers maintain • Sell side • Help distributors/manufacturers sell over Web • Include tools for creating e-catalogs

20. Benefits of Buy-side desktop • Fast and hassle free • Automate approval and submission • Management tools

21. Benefits for Centralized Buy-Side Procurement Professional • Spending analysis • Catalog management • Contract management • Approval controls

22. Benefits of Sell Side Procurement • Create new sales channels for distributors and manufacturers • Web storefronts and transaction systems

23. Auction Model Storefront Model Portal model Horizontal portals Vertical portals –vortels Dynamic pricing model B2B E-commerce andEDI Click and Mortar Business Models All fall into buyer, seller or intermediary categories. Intranets/Portals

24. Business Models • Supplier oriented marketplace • I got something to sell!!! Can be successful if supplier has sufficient number of loyal business customers and frequency of orders is not formidable ( from their point of view) • Intel • Cisco • Online customer service- tools for questions • Online ordering/ tech support • Order status • Builds to order

25. Supplier Oriented Market cont. • Benefits of this market • Reduced operating costs • Enhanced service • Reduced cost of support staff • Reduced software distribution costs(download) • Some others • IBM • Dell

26. Business Models • Buyer oriented marketplace • I got to buy something! • GE • TPN-Trading Process Network for procurement of contracts- requests start on Intranet and go out over Extranet or Internet • Now a public bidding site. www.tpn.geis.com

27. Buyer Oriented Marketplace • The process • Buyers prepare bidding info • Buyers post RFQ • Buyers identify potential suppliers • Invite suppliers • Suppliers download info • Submit bids • Buyers evaluate • Buyers accept bid • What are the benefits for sellers and buyers??

28. Business Models • Intermediary oriented marketplaces • I’m selling and You’re buying- let’s meet! • Buyers and sellers meet • E-malls • E-stores • Vertical portals- Vortals • www.bio.com • www.Motorplace.com • www.partminer.com • www.verticalnet.com hosts communities for industries • www.freemarket.com

29. EAI – Enterprise Application Integration • The heart of e-business- • Tying together • ERP- enterprise resource planning An enterprise wide application software that can provide a centralized repository of information for the massive amount of transactional detail generated daily • Integrates core business proccesses – planning, production, distribution and sales

30. EAI continued • Including Business methods • And Inventory • Leading vendors are SAP, Oracle, Peoplesoft • Databases • Store the info • Web Servers • Presents business to customers

31. New Model- VC- Virtual Corporations • Shared business goals • Common planning • Performance management tools cont. next week