Chapter 8: The Web-Enabled Enterprise

1. Management Information Systems, Sixth Edition Chapter 8: The Web-Enabled Enterprise

2. Objectives • Describe how the Web and high-speed Internet connections are changing business operations • Explain the functionality of various Web technologies • Compare and contrast options for Web servers • Explain basic business-to-business and business-to-consumer practices on the Web • Explain the relationship between Web technologies and supply chain management Management Information Systems, Sixth Edition

3. Objectives (continued) • Give examples of features and services that successful business Web sites offer • Learn about online annoyances such as spam and adware, and how to protect against online identity theft Management Information Systems, Sixth Edition

4. Web Business: Growing and Changing • DLA Piper LLP is the second largest law firm in the world • 3200 lawyers in 24 countries and 63 offices around the world • Uses eRoom, a Web-based collaboration and document-sharing tool from EMC Corp. • Saves 15,000 labor hours annually, uses and mails significantly fewer paper documents, and reduces redundant work Management Information Systems, Sixth Edition

5. Web Technologies: A Review • Several standards and technologies enable the Web to deliver rich information, including: • HTTP, HTML, XML • File Transfer • RSS • Blogs • Wikis • Podcasting • IM • Cookies Management Information Systems, Sixth Edition

6. HTTP • Hypertext Transfer Protocol (HTTP): transfer and download Web information • HTTPS: HTTP secure for confidential data exchange • Uniform Resource Locator (URL): unique address given to each Web site • IP address: a special numeric address • Domain name: unique name for a Web site, constructed with letters • URL also refers to the domain name Management Information Systems, Sixth Edition

7. HTML and XML • Hypertext Markup Language (HTML): helps developer create Web pages • Determines look and location of content • Extensible Markup Language (XML): enables creation of various data types • Conveys the meaning or content of the data • XHTML: combination of XML and HTML • Uses opening and closing tags to control format Management Information Systems, Sixth Edition

8. Management Information Systems, Sixth Edition

9. File Transfer • File Transfer Protocol (FTP): used to transmit whole files • Used in all downloads from Web sites • Any type of file can be transferred • Can place files on a server for shared use • Often used to deliver purchased software products on Web sites Management Information Systems, Sixth Edition

10. RSS • Really Simple Syndication (RSS): family of XML file formats that allow automatic downloads of content on a subscription basis • Helps users check for updates • Communicates short descriptions of content • Allows transmittal of new information • Useful on news Web sites • Also called Rich Site Summary Management Information Systems, Sixth Edition

11. Blogs • Blog: contraction of “Web log” • Invites surfers to post opinions and art • Focuses on a topic or set of topics • Trackback:a tool that notifies bloggers when their posts have been mentioned elsewhere on the Web • Blogs are often used by businesses • Importance of blogs to commercial organizations is to find out what blog participants think and say about the organization Management Information Systems, Sixth Edition

12. Wikis • Wiki (from Hawaiian, meaning “quick”): Web application that enables users to add to and edit the contents of Web pages • All the software required to edit the Web pages is embedded in the pages themselves • Wikipedia: a popular online encyclopedia • Wiki technology is a popular ingredient in groupware (software used for collaboration) Management Information Systems, Sixth Edition

13. Management Information Systems, Sixth Edition

14. Podcasting • Podcast: publishing sound and video on the Web for download • Usually on a subscription basis • Uses include: • “Time-shifted” broadcast of radio station programs for later listening • Audio tours in museums • Lectures in distance learning courses • Garageband.com • Allows aspiring musicians to post music tracks Management Information Systems, Sixth Edition

15. Instant Messaging • Instant messaging (IM): real-time chat • Form of synchronized e-mail • Chat room: communicate with a group • Free applications for IM include: • AIM: AOL instant Messenger • Yahoo Messenger • MSN Messenger • ICQ • Trillian • Business uses • Customers can chat with sales or support reps Management Information Systems, Sixth Edition

16. Management Information Systems, Sixth Edition

17. Cookies • Cookie: small file that stores information about a Web site visitor, stored on the visitor’s computer • Usually records the surfer’s ID • Often stores the surfer’s preferences • Provides convenience to consumers • Can be temporary (single session) or permanent • Potential for intrusion into surfer privacy • Clickstream tracking: tracks a surfer’s clicking activities • Spyware: traces and reports online behavior Management Information Systems, Sixth Edition

18. Proprietary Technologies • Proprietary technology: intellectual property of developer, not free for all to use • Examples: • Local search engine • Shopping cart applications • Wish lists • Video streaming tools • Tools to analyze and predict Web visitor behavior, especially shopper behavior Management Information Systems, Sixth Edition

19. Web-Enabled Business • Web-enabled business are classified according to the interacting parties: • Business-to-business (B2B) • Business-to-consumer (B2C) • Government-to-business • Government-to-consumer Management Information Systems, Sixth Edition

20. B2B Trading • Business-to-business (B2B): trading between businesses only • B2B forms include advertising through: • Search advertising: advertisements placed on a search site result page • Banners: images placed on Web sites that link to a company site selling a product or service • Impression: occurs when a page with a banner is downloaded • Reach percentage: the percentage of Web users who visited a site in the past month Management Information Systems, Sixth Edition

21. Management Information Systems, Sixth Edition

22. B2B Trading (continued) • Exchanges and auctions act as online marketplaces • Intranet: network used only by employees of an organization • Extranet: network shared by employees of different organizations, usually business partners • Exchange: extranet for organizations that deal in products and services of a particular type • Exchange operator profits from transaction fees • Auction: sells a great variety of items Management Information Systems, Sixth Edition

23. Management Information Systems, Sixth Edition

24. B2B Trading (continued) • Online business alliances: collaboration between businesses in establishing a Web site • Site operator works for the allied companies • Suppliers are invited to sell through the site and compete among themselves, driving prices down Management Information Systems, Sixth Edition

25. B2C Trading • Business-to-consumer (B2C):trading with the general public • E-Tailing: online retailing to consumers • Fulfillment activities: picking, packing, shipping • Consumer profiling: know customers better by gathering information about their online activities • Some consider this a violation of privacy • Conversion rate: the proportion of site visitors who make a purchase Management Information Systems, Sixth Edition

26. Management Information Systems, Sixth Edition

27. Management Information Systems, Sixth Edition

28. B2C Trading (continued) • Auction sites serve as a hub for consumers to buy and sell • Reverse auction: customers name their own price for desired goods and services • Content providers: offer information, artistic work, classified ads, and video • Electronic bill presentment and payment (EBBP):provides online bills and payment options for customers • Phishing: type of fraud involving a fake Web site Management Information Systems, Sixth Edition

29. Management Information Systems, Sixth Edition

30. Management Information Systems, Sixth Edition

31. B2C Trading (continued) • Extra-organizational workforce: • Companies purchase labor from a larger pool • Mobile commerce, or M-commerce: • Business conducted on mobile devices • Many experts believe that information delivery is the main mobile application, not commerce • Exceptions are Japan and South Korea • Japan’s DoCoMo’s i-mode service allows users of smart cell phones to purchase canned soda from vending machines, fast food Management Information Systems, Sixth Edition

32. B2C Trading (continued) • M-commerce also raises privacy concerns • GPS provides location tracking • New top-level domain names with .mobi available for mobile applications • Sites should use special technologies to optimize content for easy viewing on mobile devices • Virtual world: a combination of images, video, sound, and avatars that resemble the real world • Accessible for interaction by subscribers • Avatar: 3D graphical character that represents a user in a virtual world Management Information Systems, Sixth Edition

33. Supply Chains on the Web • Supply chain management (SCM) systems may be connected to the Web to allow suppliers to participate directly • Use of XML allows companies to set standards for data exchange • Electronic Data Interchange (EDI):asystem used prior to the Web to exchange documents electronically • Set standards for data formats • EDI networks are owned and managed by value-added network (VAN) companies Management Information Systems, Sixth Edition

34. Management Information Systems, Sixth Edition

35. Options in Establishing a Web Site • Web site: Web pages that make up information and links • Internet server: a computer connected to the Internet backbone • Businesses have two choices for a Web site: • Installing and maintaining their own Web servers • Contracting with a Web hosting service Management Information Systems, Sixth Edition

36. Owning and Maintaining a Server • Owning and maintaining Web servers is costly • Provides the greatest degree of control, but requires expertise to set up and maintain • Must obtain a high-speed link to the Web • Load balancing: transfer data requests from a busy server to a less busy server • Mirror servers:servers with duplicated content • Pure-play: company whose entire business is online • Brick-and-mortar: company that owns physical stores and a Web site Management Information Systems, Sixth Edition

37. Using a Hosting Service • Web hosting: Web server managing service • Several types of Web hosting: • Shared hosting: stores the client’s Web site on the same physical server as other clients • Virtual private hosting: simulates a single server, allowing a client to have its own domain name • Dedicated hosting: client has exclusive use of an entire physical Web server • Co-location: server owned and managed by a client is co-located with other clients’ servers in a secure physical location Management Information Systems, Sixth Edition

38. Considerations in Selecting a Web Host • Compare host vendors using a point system • Dynamic Web pages: enable communication between browser and database • Factors to consider when selecting Web host: • Allows use of database management system • Storage space capacity • Technical and Web site design support • Scalability • Security: physical and virtual Management Information Systems, Sixth Edition

39. Considerations in Selecting a Web Host (continued) • Factors to consider when selecting Web host (continued): • Availability: minimize downtime • Costs, including: • Setup fees • Traffic-based fees • Monthly fees Management Information Systems, Sixth Edition

40. Management Information Systems, Sixth Edition

41. More Than Meets the Eye • Several elements are essential to conducting business on the Web: • Inquiry interface: connects to database to allow user to search a catalog of products or services • Order processing application, including: • Credit-card verification application • Order-fulfillment system: picks, packs, and ships Management Information Systems, Sixth Edition

42. Management Information Systems, Sixth Edition

43. Rules for Successful Web-Based Business • Business success depends on availability and use of software • Elements needed to support B2C commerce: • Targeting customers • Capturing the customer’s complete experience • Personalizing the service • Shortening the business cycle • Let customers help themselves • Be proactive and de-commoditize Management Information Systems, Sixth Edition

44. Target the Right Customers • Target customers needing your products and services • Most important effort of marketing • Involves identifying the sites that your audience frequently visits • Consider blogs and podcasting sites for advertisement placement Management Information Systems, Sixth Edition

45. Capture the Customer’s Total Experience • Use cookies to record shopper’s movements within the site • Use CRM software to create consumer profiles • Shopper experience becomes an asset of business, allowing: • Fine-tuning of the product portfolio • Tailoring of Web pages to individual customers • Individual e-mails to shopper offering products of interest Management Information Systems, Sixth Edition

46. Personalize the Service • CRM software and Web page customization software can be combined to: • Personalize Web pages shown to a customer • Allow the customer to select the type of e-mail content desired • Respect visitor privacy by offering opt-in rather than opt-out • Allow the customer to tailor products to be purchased Management Information Systems, Sixth Edition

47. Shorten the Business Cycle • Business on the Web saves time for customers • Fulfillment is a major challenge for businesses • Activities after customer places order • Fast shipping is desired because: • It produces higher customer satisfaction • Business collects payments faster • Can outsource the entire fulfillment task to fulfillment organizations such as: • UPS’s e-Logistics • FedEx’s Supply Chain Services Management Information Systems, Sixth Edition

48. Let Customers Help Themselves • Customers need information from organization: • Status of order • Status of shipped item • Installation instructions • Troubleshooting • E-mail messages sent to customers with information about orders and how to track them • FAQs online allow customers to find answers to common questions Management Information Systems, Sixth Edition

49. Be Proactive and De-Commoditize • Prompt e-mail replies expected • Proactive alerts expected for changes in orders or services, or product recalls • Automatic reordering features are desirable • Must take initiatives to de-commoditize products • Commodity: a product sold at roughly the same price by many vendors (no differentiation) • Addition of features or services prevents a product from becoming a commodity by creating differentiation Management Information Systems, Sixth Edition

50. E-Commerce is Every Commerce • Web technologies have been highly integrated into the business world • Difficult to identify which business activities are on the Internet and which are not • Web has been highly integrated into daily activities of customers also • Commerce and e-commerce generally have the same meaning today Management Information Systems, Sixth Edition