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Electronic and mobile commerce
Transcript of Electronic and mobile commerce
Ethical and Social Issues
• increasingly considered as a remote control to digital world.
• Almost all private sectors or private individuals who have a business focused on creating mobile commerce application that will increase revenues.
Advatages of E-commerce and M-commerce
1. allows manufacturers to buy and sell worldwide at the startup of their business
2. eliminates some labor intensive steps though the order and delivery process
4. buyers will place orders at their own pace
5. provides more detail
Technology Infrastructure required to support e-commerce and m-commerce
Overview of Enterprise Systems: Transaction Processing Systems and Enterprise Resource Planning
Why learn about them?
companies interact with their suppliers, customers, government agencies and other business partners.
Electronic and mobile commerce
and enterprise system
most organization today have or are considering setting up a business on the internet and implementing integrated enterprise system.
Sales or marketing manager will be expected to help define your firms e-commerce business model. Customer service employees can expect to use enterprise systems to provide, improved customer service.
Human resources or public relations manager will likely be asked to provide content for a web site directed to potential employees and investors
Analyst in finance need to know how to set up and use enterprise systems to capture and report the data needed to manage and control the firms operation.
is the conducting of business activities electronically over computer networks such as the internet, extranets, corporate networks.
BUSINESS-TO-BUSINESS (B2B) COMMERCE
is a subset of e-commerce where all the participants are organizations.
BUSINESS-TO-CONSUMER (B2C) COMMERCE
selling products directly to customers.
producers or providers of consumer products can eliminate the middlemen, or intermediaries, between them and the consumer. This is called DISINTERMEDIATION.
Consumer-to-Consumer (C2C) E-commerce
• Subset of e-commerce that involves consumers selling directly to other consumers.
• eBay is an example of C2C e-commerce site, consumers buy and sell directly to each other using the site.
• eBay become one of the most popular websites in the world where 181 million users buy and sell items amounting to $44B.
• To simplify the sharing of information, speed formerly paper-based processes.
• Improve the relationship between the citizen and the government
• Supports the purchase of materials and services from private industry
• Improve communications among the various level of government
• We use cellphone in conducting our day-to-day activities. So, here are 4 examples of how mobile commerce affects the societies worldwide
1. The First National Bank (FNB) of South Africa offers banking services via cellphone.
2. In Japan Aeon company let their customers to pay via their cellphones.
3. In the united states, PayPal and eBay has introduced PayPal mobile.
4. Marketers are keen on equipping cellphones with gps.
• Relies on wireless devices to purchase orders and conduct business.
• Accd to GSM association 1.8B people mobile users in the world but only 12-14 percent of them have used the Web from their phones.
• The ICANN (internet corporation for assigned names and numbers)
• North America m-commerce is maturing much later than japan and western Europe.
Technology needed for mobile commerce
• The interface between the wireless device and its user must improve.
• Network speed must improve
• Battery life
• Wap(wireless Application Protocol)
Electronic and Mobile Commerce Applications
RETAIL AND WHOLESALE
• e-commerce software for plant operations
move their supply chain operations onto the internet.
can form an electronic exchange to join with competitors and suppliers
use computers and web sites to buy and sell goods, trade market info. , and run back office operations like inventory
led to much more competitive marketplace and lower prices
nature of the web allows firms to gather much information about customer behavior and preferences then they could using other marketing approaches
can measure many online activities as customers and potential customer gather information and make their purchase decisions.
Investment and finance
Online banking customers can check balances of their savings, checking, and loan accounts; transfer money among accounts; and pay their bills.
Online bill paying is electronic bill presentment, which eliminates all paper , right down to the bill itself
internet advertisers use the data they gather to identify specific portions of their markets and target them with tailored advertising messages.
technology enable relationship management is a new twist on establishing direct customer relationships made possible when firms promote and sell on the web. Thus, this occur when a firm obtains detailed information about customers a customers behavior.
Anywhere, anytime applications of mobile commerce
through mCommerce companies can reach individual consumers to establish one to one marketing relationships and communicate whenever it is convenient
Pay for calm service.
storage capacity and computing power of the hardware depends on software of server and volume of transactions
WEB SERVER SOFTWARE
retrieving and sending web pages to and from internet
web site tracking helps website management by tracking changes or activities to your website over time.
website development --java visual basic html
webpage construction -- used to make static or dynamic web pages. sql, oracle,
Electronic Payment System
Key component of the e-commerce infrastructure.
It relies on user identification and encryption to safeguard business transactions.
A digital certificate
A certificate authority
The SSL (Secure Sockets Layer encryption)
Types of Electronic Payment Systems
Smart, credit, charge, and debit cards.
Enterprise System is central to an organization and ensures information can be shared across all business functions and all levels of management to support the running and managing of a business. Ex. Enterprise Resource Planning.
As the result, the processing business transactions is for the organizations’ records that are updated to reflect the status of the operation at the time of the last processed transaction.
A TPS also provides employees involved in other business processes. It works with a large amount of input and output data and use this data to update the official records of the company, and performs activities related to customer contacts.
Traditional Transaction Processing Methods
Batch Processing System
In this processing system business transactions are accumulated over a period of time and prepared for process as a single unit of batch.
An essential characteristic of a batch processing system is that there is some delay between an event and the eventual processing of the related transaction to update the organization’s records.
Payroll transactions and billings are typically done via batch processing
Online Transaction Processing (OLTP)
Each transaction is processed immediately, without the delay of accumulating transactions into a batch.
This type of processing is essential for businesses such as airlines, ticket agencies, and stock investment firms.
OLTP helps companies or businesses to provide faster, more efficient service – one way to add value to their activities in the eyes of the costumer.
OBJECTIVES OF TPSs:
• Process data generated by and about transactions
• Maintain a high degree of accuracy and integrity
• Avoid processing fraudulent transactions
• Produce timely user responses and reports
• Increase labor efficiency
• Help improve customer service and/or loyalty
Transaction Processing Activities
TPSs capture and process date that describes fundamental business transactions. This date is used to update databases and to produce a variety of reports people both within and outside the enterprise use. The business data goes through a transaction processing cycle that includes data collection, data editing, data correction, data manipulation, data storage, and document production.
Capturing and gathering all data necessary to complete the processing of transactions
It can be done manually, such as by collecting handwritten sales order of changes to inventory. Automatically, done via special input devices such as scanners, point of sales devices and terminals
It begins with a transaction like by taking costumer order
An approach in data collection where data is captured at its source and recorded accurately in a timely fashion. An example of source data automation is an automated device at a retail store that speeds the checkout process – either UPC codes read by a scanner or RFID signals picked up when the items approach the checkout stand. Using both UPC bar codes and RFID tags is quicker and more accurate than having a clerk enter codes manually at the cash register.
Retailers turn to Smart Carts
Digital technologies have been reigning in the retail industry. These technologies are up and about, making retailers’ and customers’ lives more convenient and comfortable. According to Fujitsu, it is the Pervasive retailing environment; the use of digital technologies to integrate wired and wireless network devices to facilitate transactions in retail stores. Customers will soon be able to access product information through wireless devices like Fujitsu U-Scan Scooper. The U-Scan Scooper is a wireless computer with an integral barcode scanner.
The U-Scan Scooper is a very useful device. It provides the running total of the products the shoppers have already taken, so they wouldn’t have to guess how much they are going to spend once they’re at the cashier. It also functions as a price checker when products are missing their prices. It can also be used to make orders so customers could just pick it up when they arrive in the store. U-Scan devices, most importantly, are connected to the store network and internet, giving customers the power to upload their shopping list, and just download it once they are ready to shop. With a swipe of a debit or credit card, the shopper is out once he has already gone through the self-serve counter.
Also, the U-Scan offers this “true one is to one marketing” that enables personalized in-store advertisement campaigns that are relevant to both the shoppers’ preferences and location of the store. A notification would arrive and remind or suggest a certain good that one would like to buy. Moreover, discounts and special deals are also offered with the U-Scan device.
This is an important step in processing transaction data is to check for validity and completeness to detect any problems.
Once the system has detected any error on the data, it must be able to provide solution and fix to it in order for the transaction process to continue.
This is the process of performing calculations and other data and information related to the business transaction. It can include classifying data, sorting data into categories, performing calculations, summarizing results and storing data in the organization’s database for further processing.
This step involves one or more databases with new transactions.
Document Production and Reports
This involves generating output records, document, and reports. This can be hardcopies or displays on computer screens.
Control and Management Issues
Transaction processing systems process the fundamental business transactions that are the lifeblood of the firms operation. They capture facts about basic business operations of the organization – facts without which orders cannot be shipped, customers cannot be invoiced, and employees and suppliers cannot be paid.
Disaster Recovery Plan
The DRP is a firm plan’s to recover data, technology and tools that support critical information systems and necessary information system components such as the network, databases, hardware, software, and operating systems.
Transaction Processing System Audit
The audit can be performed by the firm’s own internal audit group or an outside auditor can be hired to provide a higher degree of objectivity. A transaction processing system audit attempts to answer four basic questions.
1. Does the system meet the business need for which it was implemented?
2. What procedures and controls have been established?
3. Are these procedures and controls being used properly?
4. Are the information systems and procedures producing accurate and honest reports?
Traditional Transaction Processing Applications
Ordering Processing systems
The traditional TPSs for order processing include order entry, sales configuration, shipment planning, shipment execution, inventory control and accounts receivable. Running these systems efficiently and reliably is so critical to an enterprise that the other processing systems are referred to as the “lifeblood of the organization.”
• The traditional TPS system that support the purchasing business function include incentory control, purchase order processing, receving and accounts payable.
• Enables the organization to plan, manage track and pay for its purchases of raw materials, parts and services
• Include the budget, accounts receivable, payroll, asset management and general ledger.
• Enables the organization to plan, manage track and control its cash flow and revenue
• Key for proper recording and reporting financial trancastions is the organization chart of accounts
o With chart of accounts , financial data can be reported in simple and consistent fashion across allorganization entripse, even if it’s a multi corporation
ENTERPRISE RESOURCE PLANNING, SUPPLY CHAIN MANAGEMENT AND CUSTOMER RELATIONSHIP MANAGEMENT
Enterprise Resouse Planning (ERP)
Set of integrated prorams that manage company’s vital business operation of an entire multi site, global organizations.
Is a database that is shared by all users so that all business dunction that have acces to current and consistent data for operational decision making and planning
An Overview of Enterprise Resourse Planning
• Evolved from materials requirement planning systems (MRP) developed in the 1970s
• In 1980s and early 1990s oraganizations recognized that transtion processing systems lacked the integration needed to coordinate activities and share valuable information accros the business fucntions of the firm
• Cost were higher nad customer servivce is poorer
• The impending year 2000 (Y2K) problem that people expected to cause date-related processing to operate incorroctly so many firms used this issue to convert to new ERP systems
Advantages of ERP
Improved access to data for operational decision making
o Operate via an integrated database, using one set to support all business function
o Support decision on optimal sourcing or cost accounting
o Organization that looks seamless
o Integrated to facilitate operational decisions and strengthen customer and supplier relationship and generate new business opportunities
• Elimination of costly, inflexible legacy systems
o Eliminate hundreds of separate system and replace with a single one
o ERP system helps match the capabilities of an organization’s information systems to its business needs
• Improvement of work processes
o ERPS systems ensures good work processes vased on best practices
• Upgrade of technology infractructure
o A company must determine which hardware, operating systems and databases it wants to use
Disadvantage of ERP Systems
• Expense in time and implementation
-benefits from the ERP system such as streamlining a company’s TPS can take a large firm usually 3-5 years and they still have to may tens of millions just to implement the system.
• Difficulty in implementing change
-changing form the company’s old system into the ERP system can take months and the amount of time required to implement the ERP system can sometimes affect the workers forcing them to retire or quit because of the severity of the time required just to change a system.
- adaptation of workers to the new system may cause disruption of work ethics as they are not familiar with the new system
• Difficulty integrating other systems
-integration of other company software such as financial analysis program, e-commerce application and many more may require companies to install another software just to integrate it with the ERP system
• Risk in using one vendor
-the high cost of switching to ERP system makes the firm to doubt about switching because doing so, the business relationship that needs to be present should be long term, as it needs the maintenance of the system and them implementation can take years.
• Risk of implementing failure
-failure in implementation of the ERP system cannot be avoided but once it happened, the cost of solution to fix the problem may require tremendous amount of resources, from money to buy the needed things to fix the problem to the right technical support.
Product and Supply Management
- Produces a production plan for the company to use as a reference for their product production
The system starts off with sales forecasting estimating the sales of the product as a group rather than retail or individually based on the consumer’s demand.
Usually takes months in order to get the forecasting right. This can be developed through ERP system or by using any other specialized programs. (other firms now use external forecasting, interacting with consumers to get information rather than internal gathering of data.)
Taking of demand and inventory into account
Sales and operations management take into account what the consumer wants to buy and the number of the product they buy. They also take into account what specific products they need to produce and in what season or time table they are demanded the most. By doing this, a high level production plan is created balancing consumer demand to production capacity.
Demand management refines production
Refinement of the production rate by determining what products they should produce more, how many products should be produced in a week, or in a day in order to meet consumer demand for individual consumption.
A detailed scheduling of what product is first to be produced, how long will the production line run in order to produce one product and when to switch production from one product to another, how many of a product is to be produced. A critical decision that can either bring a profit or loss to a company.
Amount and timing of placing an order to the suppliers for the raw materials based on the bill of materials or the recipe of ingredients needed to produce a product. It is also based on lead time (time from placing an order to time the materials arrive) and lot size (the quantity of the order and the cost of the transporting the order of the buyer)
Actual buying of the raw materials needed to produce the product
Uses detailed schedule to plan the details of running and staffing the production operation
Consumer Relationship Management and Sales Organizing
Consumer Relationship Management
Used to manage all aspects of customer interaction such as after sales service, marketing and advertising, sales and other programs that can make the customer loyal to the company.
The goal of CRM is to entertain and understand what the customer wants and potentially needs to increase their retention and to gain loyalty form them by optimizing their products based on what the customer wants.
The Consumer Relationship Management System integrates data form sales, marketing and service in a goal to record data about customer contact in order to understand and customer behavior. CRM software creates a database of its customers in order to build relationships that can make both parties benefit from each other, the customer getting what he wants and the firm gaining profit from their loyal customers.
• Electronics commerce and mobile commerce are evolving, providing new ways of conducting business that presents both opportunities for improvement and potential problems.
• E-commerce is the conducting of business activities electronically over networks.
Business-to-business (B2B) e-commerce allows manufacturers to buy at a low cost worldwide, and it offers enterprises the chance to sell to global market.
Business-to-business (B2B) e-commerce is currently the largest type of e-commerce.
Consumer-to-consumer (C2C) e-commerce – involves consumers selling directly to other consumers.
Online Auction is the chief method by which C2C e-commerce is currently conducted.
• Mobile commerce – is the use of wireless devices such as PDAs, cell phones, and smart phones to facilitate the sale of goods or services.
The Wireless Application Protocol (WAP) is a standard set of specifications to enable development of m-commerce software for wireless devices.
• Electronic retailing (e-retailing) is the direct sale from a business to consumers through electronic storefronts designed around an electronic catalog and shopping cart model.
• Cybermall – is a single Web site that offers many products and services at one Internet location.
• Manufacturers are joining electronic exchange.
• To improve the efficiency of the selling process by moving customer queries about product availability and price online.
• The Web allows firms to gather much more information about customer behavior and preferences than they could use other marketing approaches.
• The Internet has also revolutionized the world of investment and finance, especially online stock trading and online banking.
• M-commerce provides a unique opportunity to establish one-on-one marketing relationships and support communications anytime, anywhere.
• Business and people use e-commerce to reduce transaction costs, speed the flow of goods and information, improve the level of customers service.
• Enable to close coordination of actions among manufacturers, suppliers, and customers
• Enables consumers and companies to gain access to worldwide markets.
• E-commerce and m-commerce require the careful planning and integration of a number of technology infrastructure components
o Components include :
o Web server software
o E-commerce software
o A number of infrastructure components must be chosen and integrated to support a large volume of transactions with customers, suppliers, and other business partners worldwide.
• An organization must have information systems that support the routine.
o Day-to-day activities that occur in the normal course of business
o And help a company add value to its products and services.
o Transaction Processing Systems (TPSs) are the heart of most IS in businesses today.
o TPS is an organized collection of people, procedures, software, database, and devices.
o The Methods of transaction processing systems include batch and online.
o Bath processing involves the collection of transaction into batches
o Online transaction processing (OLTP) allows transaction to be entered as they occur.
o Helps an organization gain a competitive advantage.
o Transaction Processing Systems (TPSs) are the heart of most IS in
o The Traditional TPS systems that support the order processing business function include:
o Order entry
o Sales configuration
o Shipment planning
o Shipment execution
o Inventory control
o The Traditional TPSs that support the purchasing function include:
o Inventory Control
o Purchase order processing
o Accounts payable
o The Traditional TPSs that support the accounting business function include :
o Accounts Receivable
o Asset management
o General ledger
• A company that implements an enterprise resource planning system is creating a highly integrated set of systems.
o Enterprise resource planning ( ERP) is software that supports the efficient operation business processes by integrating activities throughout a business.
o It provides many advantages such as elimination of costly inflexible legacy systems proving improve work processes etc.
o Some Disadvantages are ERP systems are that they are time consuming, difficult, and expensive to implement.
o The individual application modules included in the ERP systems are designed to support best practices, the most efficient and effective ways to complete a business process.