BAB 1 & BAB 3 Pendahuluan e-business and e-commerce Mercu Buana University September 17, 2013
“It is not the strongest of the species that survive, nor the most intelligent, but the one most responsive to change” Charles Darwin“If you’re not changing faster than your environment, you are falling behind”Jack Welsh, CEO of GE
What is E-commerce and E-business • So, let’s talk about jargons… • E-commerce • E-business • The terms are less important • Gaining business benefits through is business should be the topic of discussion!
E-business and E-commerce Electronic business or e-business is the use of ICT to improve business (from the use of email to facilitate administrative procedures in buying and selling through the Internet).Electronic commerce or e-commerce is where business transactions take place via electronic communication networks, especially the Internet.
E-business vs. E-commerce The main difference between them is that e-commerce defines interaction between organizations and their customers, clients, or constituents. On the other hand, e-business is broader term that also encompasses an organization’s internal operations.Electronic commerce describes the buying and selling of products, services, and information via computer networks including the Internet, where e-Business describes the broadest definition of EC. It includes buying and selling of products and services, servicing customers, collaborating with business partners, and conducting other intra-business tasks.
E-business and e-commerce Three alternative deﬁnitions of the relationship between e-business and e-commerce
E-Business concepts E-business defined from the following perspectives: • Communications: delivery of goods, services, information, or payments over computer networks or any other electronic means • Commercial (trading): provides capability of buying and selling products, services, and information on the Internet and via other online services
E-Business concepts (cont.) • Business process: doing business electronically by completing business processes over electronic networks, thereby substituting information for physical business processes • Service: a tool that addresses the desire of governments, firms, consumers, and management to cut service costs while improving the quality of customer service and increasing the speed of service delivery
E-Business concepts (cont.) • Learning: an enabler of online training and education in schools, universities, and other organizations, including businesses • Collaborative: the framework for inter- and intra-organizational collaboration • Community: provides a gathering place for community members to learn, transact, and collaborate
E-business opportunities • Reach: • Over 1 billion users globally • Connect to millions of products • Richness • Detailed product information on 20 billion + pages indexed by Google. Blogs, videos, feeds… • Personalised messages for users • Affiliation • Partnerships are key in the networked economy
E-business opportunities • New opportunities offered with E Business • Derived from transmitting and transforming information • To gain competitive advantage • Add disruptive technology • No more Status Quo • Will lead to major impacts
Dimensions of e-business/e-commerce • Pure vs. Partial: based on the degree of digitization of: - Product - Process - Delivery agent • Traditional commerce: all dimensions are physical • Pure e-business: all dimensions are digital • Partial e-business: all other possibilities include a mix of digital and physical dimensions
Types of e-business Business-to-business (B2B)Business that sells products or provides services to other businessesBusiness-to-consumer (B2C)Business that sells products or provides services to end-user consumersConsumer-to-consumer (C2C)Consumers sell directly to other consumers
Types of e-business (cont.) Business-to-government (B2G)Government buys or provides goods, services or information to/from businesses or individual citizensBusiness-to-employee (B2E)Information and services made available to employees onlineMobile commerce (m-commerce)E-commerce transactions and activities conducted in a wireless environmentCollaborative commerce (c-commerce)Individuals or groups communicate or collaborate online
Figure 1.2Summary and examples of transaction alternatives between businesses, consumers and governmental organizations
Evolution of e-business How it started • Electronic data interchange (EDI) - electronically transfer routine documents (application enlarged pool of participating companies to include manufacturers, retailers, services) • 1970s: innovations like electronic funds transfer (EFT) - funds routed electronically from one organization to another (limited to large corporations) • 1990s: the Internet commercialized and users flocked to participate in the form of dot-coms, or Internet start-ups
Traditional Purchasing Process Flow Source: ariba.com, February 2001.
Stakeholders E-Business relationships are formed with the following types of stakeholders: • Internal stakeholders: Management and staff • Suppliers and manufactures • Customers • Intermediaries • Financial institutions • Web service providers • Associations • Web communities • Etc.
Market Transformation • Sometimes it isn’t just about “reach, richness and affiliation” • Must improve the use of online channel • Realize that many users research online • But purchase offline • So now, with the increased availability of information • New opportunity to gain customer • New means of advertising… think of google!
Building Closer Relationships • E-business can help achieve customer retention.. • Reducing costs • Offer a new channel for purchase • Improved Customer Service • But your customers are “a mouse click away” • What do you think?
So, E-business is great! • Is everyone using it? • Should they? • Must remember the risks • Strategic risks • Flawed purchase • High investment with no returns • .com era! • Practical Risks • Hacks, Fails, etc • Risks are more dangerous than ever before…
Perspectives of E-Commerce • Communications Perspective • Business Process Perspective • Service Perspective • Online Perspective • Other perspectives?
Sell side Vs Buy side • Buy Side • Procure resources needed • The buying organization • Sell Side • Selling products to customers • More than just books and CDs • Also to market various services… (Ch 8)
Sell Side E-Commerce • Transactional Sites • Enable purchase of products • Sales as main business contributor • Retail sites, travel sites, etc • Service oriented relationship building • Provide information • To stimulate purchase… where? • Value add by providing information to existing customers
Sell Side E-commerce 2 • Brand Building Sites • Provide the experience to support the brand • Not for online purchase • Just for online existence • Cheap, daily, groceries products • Portal and Media Sites • Range of topics offered • Gateway of information full of links • Business from ads, commissions, data sales, etc.
Supply Chain Management • The difference between sell-side or buy side • Are aspects of SCM • SCM includes all aspects of coordinating supply activities from suppliers, until it reaches the hands of the customers • Value Chain describes the value adding activities that connect the supply side with its demand side. • With the Internet… it is now cross boundaries. • Hence we hear the value network
Other Aspects of E-Business • Internet Vs Intranet • Communication medium • Public Vs Private • Pure Vs Partial • Digital or Physical • All aspects of transactions