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E-Commerce Level 3 Part 1


Martin Radnan

on 2 August 2010

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Transcript of E-Commerce Level 3 Part 1

Introduction to the Module Lecturer: Martin Radnan Schedule and Assessment Definitions
Researching E-Commerce
Global perspective E-commerce shopping on the web ? electronic business ? E-commerce is not new Banks use EFT’s Businesses use EDI In the 1960s businesses realized that by sending
information electronically in a standard format,
businesses could save money and reduce transcription
Technology and commerce Traditional commerce.
Identify activities involved
Identify how technology can improve them The buyer’s perspective From the buyer’s perspective, commerce involves
the following activities:

Identify need
Search for products or services
Select a vendor
Negotiate purchase
Maintenance The seller’s perspective From the sellers’ perspective, commerce involves
the following activities:

Identify customer needs
Create a product or service
Negotiate a sales transaction
Ship goods and issue invoice
Receive and process payment
After-sales support and maintenance Business processes Business processes are the activities involved in conducting commerce So what is E-Commerce? We will define e-commerce as:

“..automation of commercial transactions using
computer and communications technologies”
(Westland and Clark 1999:1)

“E-Commerce is an emerging concept that
describes the process of buying and selling
or exchanging of products, services and information via computer networks including
the Internet”
(Turban et al 2000:4)
Definition: E-Business “Electronic business is all electronically mediated information exchanges both within an organisation and with external stakeholders supporting a range of business processes” (Chaffey 2002 preface) Impact of E-commerce E-commerce changing the way traditional
commerce is conducted:

- The value chain is being reconfigured.
Value chain analysis A way of looking at the activities of an industry or organization.

Primary activities
Costs are directly allocated to a product

Support activities
Costs are associated with the overall operation
of the organization
Reconfiguring the value chain Vertical

Forward integration
Backward integration

Appropriateness Which business processes can be streamlined

Some processes can’t be improved upon using

Technology can be a costly mistake. Well-suited for e-commerce Business processes that are well-suited for electronic commerce:

Sale/purchase of new books and CDs
Online delivery of software
Advertising and promotion of travel services
Online tracking of shipments
Best for traditional commerce Business processes that are well-suited to traditional
Sale/purchase of high fashion clothing
(Any possible exceptions?)
Sale/purchase of perishable food products
Small-denomination transactions (Future?)
Sale of expensive jewelry and antiques Combinations of both Some business processes can be handled well using
a combination of electronic and traditional methods:

Examples ? Advantages of e-commerce For the seller:
promotion easier
narrow market segments For the buyer:
competitive bids
In general:

Increases speed and accuracy

Electronic payments cost less to issue and are
more secure

Access to remote areas

Scheduling flexibility
Disadvantages of e-commerce Some business processes not suited to e-commerce

Need for Critical mass of potential buyers

Costs can be difficult to quantify

Cultural impediments

The legal environment is uncertain
What is it all about? Business stuff plus ‘e’:

Value and supply chains
Logistics and so on and on and on Some main issues Relationships
Privacy and Security
Technology e.g. CRM
Organisations e.g. Bricks and Clicks…
People e.g. Customer Services call centre operative Sources and research pitfalls E.g. ‘web demographics’ – ‘google’ offers 600,000+ pages!

Global data providers use different methodologies, definitions and have vested interests. Indicator measures OECD definition as indicator:
Networks used (Internet and others)
Specific business processes embraced
Main actors (household, government, organisations etc)
Consider bias MINTEL
KMPG, Gartner group, Forrester National statistics www.open.gov.uk; www.statistics.gov.uk
www.istat.it (Italy in figures)
www.ksh.hu (Hungary in figures)
www.cbs.nl (Netherlands)
www.stat.fi/ibs (Finland)
www.stats.gov.cn/english/ (China)
Groups commentating on the ‘Information Society’ Washtech: www.washtech.org
Cryptogram: www.counterpane.com/crytpo-gram.html
EPIC: www.epic.org
Statewatch: www.statewatch.org
First Monday: http://firstmonday.org Global perspective A global perspective is crucial because we live in a system of global capitalism but is globalisation a myth?

‘A truly global economy is said to have emerged in which distinct national economies and therefore domestic strategies for economic management are irrelevant’

Hirst,P and Thompson D
Globalisation in Question Blackwell 1998

What are the characteristics of the ‘global economy’?
What arguments are there for and against the notion of a ‘global economy’? World ‘whistle stop’ tour The so-called TRIAD – North America, Europe and Japan
The Pacific Rim – Japan, Taiwan, Australia, New Zealand
South America
The so-called ‘Least Developed Countries’ (LDC’s) Conclusion eCommerce success may depend on:

Orientations of the business case – the strength of the answers to ‘why’ questions
Rate of change, adaptability of the ‘how’ issues
Beware hype and extremes of utopia and dystopia
Full transcript