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© Farhan Mir© Farhan Mir
20200707 IMSIMS
E-Commerce & E-Commerce & Internet Internet ApplicationsApplicationsBBA (Hons) 7BBA (Hons) 7thth Course Overview & Course Overview & IntroductionIntroductionLectures 1,2,3Lectures 1,2,3
Course Lecturer: Farhan MirCourse Lecturer: Farhan Mir
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Lectures 123 Lectures 123 AdministrationAdministrationIntroducing Myself (which you already know)Course IntroductionFew Words on Articles & Additional ReadingsSuggestions and criticism about previous semestersSuggestion for future course of actionE-Business OverviewMy Own Website as Online Resource Center
(www.themirs.net)
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Course LecturerCourse Lecturer (Brief (Brief Introduction)Introduction)
Farhan Azmat Mir
MIMS [Monash University Melbourne]MBA (MIS) [B.Z.U] Gold Medal
Some Words regarding my Academic and Professional Life
1.5 Years at Melbourne1.5 Years at MelbourneAlmost 5 Years at IMS (as Almost 5 Years at IMS (as Lecturer)Lecturer)
Some Words on the FutureWorking on Research papersCompiling Case Studies in the areas of MIS, E-Business & HRMGoing for Professional Training
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Current Responsibilities at Current Responsibilities at IMSIMSAdvisor Students (Evening)
All issues and queries relating to evening All issues and queries relating to evening programs including BBA-IT, MBA-IT, MBA programs including BBA-IT, MBA-IT, MBA (Banking) and MBA (Executive)(Banking) and MBA (Executive) Coordination of all academic and extra-curricular Coordination of all academic and extra-curricular functions relating to evening programs including functions relating to evening programs including “Formal “Formal
Orientations", "Welcome & Farewells Parties"Orientations", "Welcome & Farewells Parties"
Coordinator BBA-IT Program Curriculum Development and ReviewCurriculum Development and ReviewAll office documentation (Course Files and All office documentation (Course Files and Quality documents)Quality documents)Coordination with Permanent & Visiting Faculty Coordination with Permanent & Visiting Faculty membersmembersStudent application and documentation Student application and documentation evaluationevaluationClass Scheduling and MonitoringClass Scheduling and Monitoring
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Current Responsibilities at Current Responsibilities at IMSIMS
Incharge Seminar & Drama Society Development of Seminar Calendar in Development of Seminar Calendar in close coordination with all faculty close coordination with all faculty membersmembersAll logistic and coordination support All logistic and coordination support for Seminars, Conferences, Workshops for Seminars, Conferences, Workshops & Drama activities& Drama activitiesArrangement and Liaison-keeping with Arrangement and Liaison-keeping with Speakers and Guest LecturersSpeakers and Guest Lecturers
© Farhan Mir© Farhan Mir
20200707 IMSIMS
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Current ResponsibilitiesCurrent Responsibilities
At University LevelPart of many committeePart of many committee
Convocations & Major EventsSports
Currently working on a mega project Currently working on a mega project (BGC)(BGC)
Bahauddin Zakariya University Golf Club
© Farhan Mir© Farhan Mir
20200707 IMSIMS
BZU Golf BZU Golf Club Club
© Farhan Mir© Farhan Mir
20200707 IMSIMS
My Introduction: My Introduction: Consultation Consultation MethodMethod Best through e-mail address
(farhanmir_99@hotmail.com) OR
In case of submission of assignment through email (farhanmir_99_pk@yahoo.com)
After/before lectures on lecture day OR
Announced Timings in case of Assignments or Reports
Consultation Timings: 11:00 am to 12:00 pm Thursday-Friday
© Farhan Mir© Farhan Mir
20200707 IMSIMS
My Introduction: My Introduction: InterestsInterests
SportsSocial & Cultural Change
PersonalityDevelopment
Religion
History &Art
Creativity & New Ideas
© Farhan Mir© Farhan Mir
20200707 IMSIMS
My InspirationsMy Inspirations
© Farhan Mir© Farhan Mir
20200707 IMSIMS
My InspirationsMy Inspirations
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Favourite QuotesFavourite Quotes"Champions aren't made in gyms. Champions are made from something they have deep inside them: A desire, a dream, a vision. They have to have last-minute stamina, they have to be a little faster, they have to have the skill and the will. But the will must be stronger than the skill." -Muhammad Ali
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Favourite QuotesFavourite Quotes
“You are educated. Your certification is in your degree. You may think of it as the ticket to the good life. Let me ask you to think of an alternative. Think of it as your ticket to change the world”.(Tom Brokaw)
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Favourite QuotesFavourite Quotes“You’re not a wave, you’re a part of the ocean.”
Love lost is still love. It takes a different form, that’s all. Memory. Memory becomes your partner. You nurture it. You hold it. Life has to end. Love doesn’t.
Mitch Albom
"A minute's success pays the failure of years"
Robert Browning
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Favourite QuotesFavourite Quotes
Anyone who has never made a mistake has never tried anything new.
~Albert Einstein
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Course Course Administration &Administration &RequirementsRequirements
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Course AdministrationCourse Administration
Exams and AssessmentBasically 2 exams method Mid & Basically 2 exams method Mid & FinalFinal
30 Mid
50 Final
20 Sess
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Lecture NotesLecture NotesAvailable from Photostat shop before lectures or preferably one day before the start of new week
Usually the lecture material will cover the topics of one weekLecture Notes also now available online on the given website address (www.themirs.net/ec.html)Lecture Notes will not be in detail format rather these will contain topics of discussion and important announcements regarding assessments.
Most Importantly Lecture Notes are just a supporting material and students must not forget to read books for detail and complete understanding (In case of Management as a subject you need to do extensive reading on topics under discussion & look for majority of web sites for practical know how)
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Course AdministrationCourse AdministrationSessionals
Written assignments (Small Tasks) (details Written assignments (Small Tasks) (details in coming lectures)in coming lectures)
Idea is to initiate research oriented writing not “cut-copy-paste”
Attendance, Presentations, Quiz & Class Attendance, Presentations, Quiz & Class Discussion & Participation (as a regular Discussion & Participation (as a regular activity)activity)
Volunteer presentations (you must not be Volunteer presentations (you must not be that familiar with this kind of stuff but you that familiar with this kind of stuff but you need to respond to it quickly!)need to respond to it quickly!)
Sessional’s loot saleSessional’s loot sale
Formal Presentations in groups and if you Formal Presentations in groups and if you want to take it one step ahead you could want to take it one step ahead you could arrange small seminars for other classes arrange small seminars for other classes (preferably your juniors) on given (preferably your juniors) on given “Research Topics”“Research Topics”
© Farhan Mir© Farhan Mir
20200707 IMSIMS
How to get more marks?How to get more marks?
RequirementsOverall Class AttitudeOverall Class Attitude
Things to Avoid (Referencing, Cut-Copy-Things to Avoid (Referencing, Cut-Copy-Paste Culture, Carelessness, leg-pulling)Paste Culture, Carelessness, leg-pulling)
Things to do (Innovation, Confidence, Things to do (Innovation, Confidence, Work Attitude)Work Attitude)
Sense of Maturity and continuous Sense of Maturity and continuous learninglearning
© Farhan Mir© Farhan Mir
20200707 IMSIMS
One of the Major One of the Major SessionalsSessionalsCase Study PresentationStudents in groups of 5-7 will choose an e-Business Students in groups of 5-7 will choose an e-Business (Preferably a Pakistani Organization)(Preferably a Pakistani Organization)Case should be developed on the given format (A Case should be developed on the given format (A model format will be discussed in upcoming lectures)model format will be discussed in upcoming lectures)Students need to develop a proper case study using Students need to develop a proper case study using the case study development guidelinesthe case study development guidelinesEventually will present their findings in the shape of Eventually will present their findings in the shape of a Presentation in front of the class or classes on a Presentation in front of the class or classes on MultimediaMultimediaStudents need to submit both Hard (Printed) and Soft Students need to submit both Hard (Printed) and Soft copies (Computer files) of the Case itself and that of copies (Computer files) of the Case itself and that of the PowerPoint Presentation the PowerPoint Presentation This is day 1 so you can start working now!This is day 1 so you can start working now!I will myself present at least one Case Study well I will myself present at least one Case Study well before the presentation schedule so that you people before the presentation schedule so that you people have an idea have an idea
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Another Important ProjectAnother Important ProjectE-Commerce Business Development
Need to choose one Industry and develop a Business Model for an Online BusinessBusiness Model will include
Purpose of BusinessPurpose of Business
Product & ServicesProduct & Services
Potential customersPotential customers
Marketing & Promotional StrategiesMarketing & Promotional Strategies
Competition AnalysisCompetition AnalysisA Static Website as a final Outcome using Microsoft FrontPage
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Last Year Case StudiesLast Year Case Studies
Harley Davidson (Motor Bike Company)
PIA (Travel Industry)
UBL (Banking Online)
World Expeditions (Tourism & Travel)
Mobilink (Telecommunication)
IBM (Computer Giant)
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Course OrientationCourse OrientationBasically Theoretical focus
Introduction of Concepts and Issues regarding E-Business (This subject is developed in case study mode: it means that there are lot of case studies)
ButThe practical orientation will also be also be a major The practical orientation will also be also be a major focus of the course (this will include practical focus of the course (this will include practical demonstration on multimedia)demonstration on multimedia)
Lecture notes will include more graphical explanation Lecture notes will include more graphical explanation of things to give more practical orientation about of things to give more practical orientation about concepts & applications especially the websites of concepts & applications especially the websites of major e-Businessesmajor e-Businesses
Formal Presentation from Students will also work in Formal Presentation from Students will also work in this regardthis regard
Video or Audio Presentation will also be part of the Video or Audio Presentation will also be part of the lectures lectures
© Farhan Mir© Farhan Mir
20200707 IMSIMS
ExaminationExamination
I personally believe in “thorough studies” so usually no choices given in the examEvery thing discussed, during the class or given as reading material, could be part of the examsQuestions will be formulated in a way to examine both bookish as well as conceptual thinking Other details will be given close to MidI will try to follow my simple rule that is
“ “ I’ll be very friendly in the lectures and very I’ll be very friendly in the lectures and very strict in the exam hall strict in the exam hall (believe me no (believe me no chance of misconduct…)”chance of misconduct…)”
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Text & ReferencesText & References
Focus will be on topics rather Chapters of any textMany Text/books are available in market
Efraim Turban, Joe Lee, David King & Michael Chung. (2004). “Electronic Commerce: A Managerial Perspective”. Prentice Hall International
Mostly things will be taught from the Text but students need to broaden their view and consult as many additional references as possible (Preferably available in local market and from the Internet)
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Guidelines for me as
an Instructor
True Knowledge
not stories
Class Environment
Updated Teaching
Methodology
Neutral Assessment (Objective)
Competency & Skills
Learning not Teaching
Miscellaneous
(Regularity, Consultancy,
Support etc)
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Overview of
Electronic Commerce & E-Business
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Learning ObjectivesLearning Objectives
Define electronic commerce (EC) and describe its various categories
Describe the content and frameworks of EC
Describe the major types of EC transactions
Discuss the benefits of EC to organizations, consumers, and society
Describe the limitations of EC
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Learning ObjectivesLearning Objectives
Describe the role of the digital revolution in EC and the economic impact of EC
Discuss the contribution of EC in helping organizations respond to business pressures
© Farhan Mir© Farhan Mir
20200707 IMSIMS
EC Definitions & ConceptsEC Definitions & Concepts
Electronic Commerce (EC) is the process of buying, selling, or exchanging products, services, and information via computer networks
© Farhan Mir© Farhan Mir
20200707 IMSIMS
E-Business Definitions & E-Business Definitions & ConceptsConcepts
E-business is a broader definition of EC that includes not just the buying and selling of goods and services, but also
Servicing customers (Value Added Servicing customers (Value Added Information)Information)
Collaborating with business partnersCollaborating with business partners
Conducting electronic transactions Conducting electronic transactions within an organization (Intra-Business within an organization (Intra-Business Activities)Activities)
Non-Profit Activities (Community Non-Profit Activities (Community Building)Building)
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Basic Definition & Basic Definition & ConceptsConcepts
E-Business & E-Commerce defined from these perspectives
CommunicationsCommunications
Business processBusiness process
ServiceService
Online CollaborationsOnline Collaborations
CommunityCommunity
© Farhan Mir© Farhan Mir
20200707 IMSIMS
E-BusinessE-Business
Quote for Lou Gerstner, IBM’s CEO:
“E-Business is all about speed, globalization, enhanced productivity, reaching new customers, and sharing knowledge across institutions for competitive advantage.”
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Basic Concepts & Basic Concepts & DefinitionDefinitionSo what is E-Business?
Simple definition: Any business carried out in electronic form.
“The complex fusion of business processes, enterprise applications, and organizational structure to create a high-performance business model.” (Kalakota and Robinson)
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Examples of E-BusinessExamples of E-Business
Yahoo
eBay
Amazon
Priceline
Sears
Virtual University of Pakistan
ATM machines???
© Farhan Mir© Farhan Mir
20200707 IMSIMS
© Farhan Mir© Farhan Mir
20200707 IMSIMS
EC Definitions & ConceptsEC Definitions & Concepts
Traditional commerce: Traditional commerce: all dimensions are all dimensions are physicalphysical
Brick-and-mortar organizations
Old-economy Old-economy organizations organizations (corporations)(corporations)
Perform all Perform all business off-linebusiness off-line
Sell physical Sell physical products by means products by means of physical agentsof physical agents
© Farhan Mir© Farhan Mir
20200707 IMSIMS
EC Definitions & ConceptsEC Definitions & Concepts
Pure EC: all dimensions Pure EC: all dimensions are digitalare digital
Pure online (virtual) organizations
New-economy organization
Sell products or services only online
Partial EC: a mix of digital Partial EC: a mix of digital and physical dimensionsand physical dimensions
Click-and-mortar organizations
Conduct EC activities
Do their primary business in the physical world
© Farhan Mir© Farhan Mir
20200707 IMSIMS
The Dimensions of Electronic The Dimensions of Electronic CommerceCommerce
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Physical to Virtual Physical to Virtual InterfacingInterfacing
Old-economy companies are extending their reach by offering on-line services (catalogs, commodities, and e-services),
Office Depot (Office supplies; #2 web retailer, Office Depot (Office supplies; #2 web retailer, after Amazon) after Amazon) ((www.officedepot.com) & www.officedepot.com) & (www.amazon.com)(www.amazon.com)
LL Bean (Catalog sales; Dogs are in at LL Bean) LL Bean (Catalog sales; Dogs are in at LL Bean) (www.llbean.com)(www.llbean.com)
Barnes and Noble(Booksellers) Barnes and Noble(Booksellers) (www.bn.com)(www.bn.com)
Boeing Parts Network (24/7 parts for airlines) Boeing Parts Network (24/7 parts for airlines) ((www.boeing.com/assocproducts/direct/bd_home.html)www.boeing.com/assocproducts/direct/bd_home.html)
Outreach to customers.Commodities sell well in e-space.
© Farhan Mir© Farhan Mir
20200707 IMSIMS
© Farhan Mir© Farhan Mir
20200707 IMSIMS
© Farhan Mir© Farhan Mir
20200707 IMSIMS
© Farhan Mir© Farhan Mir
20200707 IMSIMS
© Farhan Mir© Farhan Mir
20200707 IMSIMS
EC Definitions & ConceptsEC Definitions & Concepts
Internet vs. Non-Internet ECInternet ECInternet EC
Use of Websites to advertise, Buy & Sell
Much cheaper and highly accessible
Non-Internet ECNon-Internet EC
VANs—value-added networks
LANs—local area networks
Single computerized machines
Using a smart card in a vending Using a smart card in a vending machinemachine
Using a cell phone to make an online Using a cell phone to make an online purchasepurchase
© Farhan Mir© Farhan Mir
20200707 IMSIMS
The EC Framework and The EC Framework and FieldField
An EC FrameworkEC applications supported by EC applications supported by infrastructure and 5 support areasinfrastructure and 5 support areas
PeoplePublic policyTechnical standards and protocolsBusiness partners (mutual collaboration)Support services
© Farhan Mir© Farhan Mir
20200707 IMSIMS
A Framework for ECA Framework for EC
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Classification of EC by the Classification of EC by the Nature of the TransactionNature of the Transaction
Business-to-business (B2B) : EC model in which all of the participants are businesses or other organizations
Business-to-consumer (B2C): EC model in which businesses sell to individual shoppers
Business-to-business-to-consumer (B2B2C): EC model in which a business provides some product or service to a client business; the client business maintains its own customers, to whom the product or service is provided
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Examples!Examples!
Business-to-Consumer (B2C)Yahoo!Yahoo! (www.yahoo.com) - (aggregator) leading (www.yahoo.com) - (aggregator) leading portalportal and most visited e-space! and most visited e-space!
E-Trade (www.etrade.com) On-line investing E-Trade (www.etrade.com) On-line investing and banking; moving to click-and-mortar and banking; moving to click-and-mortar outposts. outposts.
McAfee (www.mcafee.com) Software McAfee (www.mcafee.com) Software subscription services for virus scanning.subscription services for virus scanning.
Software purchase, delivery and update, Software purchase, delivery and update, example is: Copernic (www.copernic.com)example is: Copernic (www.copernic.com)
Digital Content Services; example is: Sony Music Digital Content Services; example is: Sony Music (www.sony.com) (www.sony.com)
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Classification of EC by the Classification of EC by the Nature of the Transaction Nature of the Transaction 22
Consumer-to-business(C2B): individuals who use the Internet to sell products or services to organizations and /or seek sellers to bid on products or services they need
Consumer-to-consumer (C2C) : consumers sell directly to other consumers
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Examples!Examples!
Consumer-to-Consumer (C2C)EbayEbay (www.ebay.com) - (facilitator) electronic (www.ebay.com) - (facilitator) electronic auctions with consumers handling transaction auctions with consumers handling transaction and shipping.and shipping.
NapsterNapster (www.napster.com) - (facilitator) peer- (www.napster.com) - (facilitator) peer-to-peer music exchange; courts not happy.to-peer music exchange; courts not happy.
Groove NetworksGroove Networks (www.groove.com) (facilitator) (www.groove.com) (facilitator) secure peer-to-peer collaboration services. secure peer-to-peer collaboration services. Founded by Ray Ozzie, the creator of Lotus Founded by Ray Ozzie, the creator of Lotus Notes.Notes.
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Classification of EC by the Classification of EC by the Nature of the Transaction Nature of the Transaction 33
Mobile commerce (m-commerce)—EC transactions and activities conducted in a wireless environment
Location-commerce—(l-commerce)
m-commerce transactions targeted to individuals in specific locations, at specific times
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Classification of EC by the Classification of EC by the Nature of the Transaction Nature of the Transaction 44
Intrabusiness (organizational) EC: EC category that includes all internal organizational activities that involve the exchange of goods, services, or information among various units and individuals in an organization
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Classification of EC by the Classification of EC by the Nature of the Transaction Nature of the Transaction 55
Business-to-employee (B2E): EC model in which an organization delivers services, information, or products to its individual employees
Collaborative commerce (c-commerce): EC model in which individual or groups communicate or collaborate online
E-government: Government-to-citizens (G2C): EC model in which a government entity buys or provides good, services, or information to businesses or individual citizens
© Farhan Mir© Farhan Mir
20200707 IMSIMS
MarketingComputer sciencesConsumer behavior and psychologyFinanceEconomics
Management information systemsAccounting and auditingManagementBusiness law and ethicsOthers
Interdisciplinary Nature Interdisciplinary Nature of ECof EC
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Brief History of E-Brief History of E-CommerceCommerce
Some major shifts from 70s till Some major shifts from 70s till nownow
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Brief History of ECBrief History of EC
EC applications first developed in the early 1970s
Electronic funds Electronic funds transfer (EFT)transfer (EFT)
Limited to:Large corporationsLarge corporations
Financial institutionsFinancial institutions
A few other daring A few other daring businessesbusinesses
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Brief History of EC Brief History of EC 22
Electronic data interchange (EDI)—electronic transfer of documents:
Purchase ordersPurchase orders
InvoicesInvoices
E-payments E-payments between firms doing between firms doing businessbusiness
Enlarged pool of participants to include:
ManufacturersManufacturers
RetailersRetailers
Service providersService providers
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Brief History of EC Brief History of EC 33
Interorganizational systems (IOS)Stock tradingStock trading
Travel reservation systemsTravel reservation systems
Internet became more commercialized in the early 1990s
Almost all medium-and large-Almost all medium-and large-sized organization in the world sized organization in the world now has a Web sitenow has a Web site
Most large corporations have Most large corporations have comprehensive portalscomprehensive portals
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Brief History of EC Brief History of EC 44
EC SuccessesPure onlinePure online
eBay
VeriSign
AOL
Checkpoint
Click-and-mortarClick-and-mortar
GE
IBM
Intel
Schwab
EC FailuresE-tailors began to E-tailors began to fail in 1999fail in 1999
This does not mean This does not mean that EC’s days are that EC’s days are numberednumbered
Large EC companies Large EC companies like Amazon.com like Amazon.com are expanding but are expanding but success or failure is success or failure is not certainnot certain
© Farhan Mir© Farhan Mir
20200707 IMSIMS
The Benefits of ECThe Benefits of EC
Benefits to OrganizationsExpands the marketplace to national Expands the marketplace to national and international marketsand international markets
Decreases the cost of creating, Decreases the cost of creating, processing, distributing, storing and processing, distributing, storing and retrieving paper-based informationretrieving paper-based information
Allows reduced inventories and Allows reduced inventories and overhead by facilitating pull-type overhead by facilitating pull-type supply chain managementsupply chain management
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Benefits of ECBenefits of EC
The pull-type processing allows for The pull-type processing allows for customization of products and customization of products and services which provides services which provides competitive advantage to its competitive advantage to its implementersimplementers
Supports business processes Supports business processes reengineering (BPR) effortsreengineering (BPR) efforts
Lowers telecommunications cost - Lowers telecommunications cost - the Internet is much cheaper than the Internet is much cheaper than value added networks (VANs) value added networks (VANs)
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Benefits of EC Benefits of EC
Benefits to consumersEnables consumers to shop or do Enables consumers to shop or do other transactions 24 hours a other transactions 24 hours a day, all year round from almost day, all year round from almost any locationany location
Provides consumers with more Provides consumers with more choiceschoices
Provides consumers with less Provides consumers with less expensive products and services expensive products and services by allowing them to shop in many by allowing them to shop in many places and conduct quick places and conduct quick comparisonscomparisons
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Benefits of ECBenefits of EC Allows quick delivery of products and Allows quick delivery of products and services (in some cases) especially services (in some cases) especially with digitized productswith digitized products
Consumers can receive relevant and Consumers can receive relevant and detailed information in seconds, detailed information in seconds, rather than in days or weeksrather than in days or weeks
Makes it possible to participate in Makes it possible to participate in virtual auctionsvirtual auctions
Allows consumers to interact with Allows consumers to interact with other consumers in electronic other consumers in electronic communities and exchange ideas as communities and exchange ideas as well as compare experienceswell as compare experiences
Facilitates competition, which results Facilitates competition, which results in substantial discountsin substantial discounts
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Benefits of EC Benefits of EC
Benefits to societyEnables more individuals to work at Enables more individuals to work at home, and to do less traveling for home, and to do less traveling for shopping, resulting in less traffic on shopping, resulting in less traffic on the roads, and lower air pollutionthe roads, and lower air pollution
Allows some merchandise to be sold Allows some merchandise to be sold at lower prices, benefiting less at lower prices, benefiting less affluent peopleaffluent people
Enables people in Third World Enables people in Third World countries and rural areas to enjoy countries and rural areas to enjoy products and services which products and services which otherwise are not available to themotherwise are not available to them
Facilitates delivery of public services Facilitates delivery of public services at a reduced cost, increases at a reduced cost, increases effectiveness, and/or improves qualityeffectiveness, and/or improves quality
© Farhan Mir© Farhan Mir
20200707 IMSIMS
The Limitations of ECThe Limitations of ECTechnical limitations
There is a lack of universally accepted There is a lack of universally accepted standards for quality, security, and reliabilitystandards for quality, security, and reliability
The telecommunications bandwidth is The telecommunications bandwidth is insufficientinsufficient
Software development tools are still evolvingSoftware development tools are still evolving
There are difficulties in integrating the There are difficulties in integrating the Internet and EC software with some existing Internet and EC software with some existing (especially legacy) applications and (especially legacy) applications and databases.databases.
Special Web servers in addition to the Special Web servers in addition to the network servers are needed (added cost).network servers are needed (added cost).
Internet accessibility is still expensive and/or Internet accessibility is still expensive and/or inconvenientinconvenient
© Farhan Mir© Farhan Mir
20200707 IMSIMS
The Concept of Digital The Concept of Digital EconomyEconomy
An IntroductionAn Introduction
© Farhan Mir© Farhan Mir
20200707 IMSIMS
The Digital Revolution and The Digital Revolution and
the Economic Impact of the Economic Impact of ECEC
In the Digital Revolution the economy is based on digital technologies including:
Digital communication networksDigital communication networks
ComputersComputers
SoftwareSoftware
Other related information Other related information technologiestechnologies
Also called:Internet economyInternet economy
New economyNew economy
Web economyWeb economy
© Farhan Mir© Farhan Mir
20200707 IMSIMS
The Digital Revolution and The Digital Revolution and
the Economic Impact of the Economic Impact of EC EC
Digital networking and communication infrastructures provide a global platform where people and organizations:
InteractInteract
CommunicateCommunicate
CollaborateCollaborate
Search for informationSearch for information
© Farhan Mir© Farhan Mir
20200707 IMSIMS
The Digital Revolution and The Digital Revolution and
the Economic Impact of the Economic Impact of EC EC 33
The global platform includes these characteristics
A vast array of digitizable A vast array of digitizable productsproducts
Consumers and firms conduct Consumers and firms conduct financial transactions digitallyfinancial transactions digitally
Microprocessors and networking Microprocessors and networking capabilities embedded in physical capabilities embedded in physical goodsgoods
© Farhan Mir© Farhan Mir
20200707 IMSIMS
The Digital Revolution and The Digital Revolution and
the Economic Impact of the Economic Impact of EC EC The term digital economy also
refers to the convergence of computing and communication technologies on the Internet and other networks and the resulting flow of information and technology that is stimulating e-commerce and vast organizational changes
© Farhan Mir© Farhan Mir
20200707 IMSIMS
The Digital Revolution and The Digital Revolution and
the Economic Impact of the Economic Impact of EC EC
This convergence enables all types of information (data, audio, video, etc.) to be stored, processed, and transmitted over networks to many destinations worldwideWeb-based EC systems are accelerating the digital revolution by providing competitive advantage to organizations
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Contributions of EC Contributions of EC towards modern towards modern OrganizationsOrganizations
Types of Pressures and EC as a Types of Pressures and EC as a solutionsolution
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Business PressuresBusiness Pressures
The term business environment refers to the social, economic, legal, technological, and political actions that affect business activities
Business pressures are divided into the following categories:
Market (economic)Market (economic)
SocietalSocietal
TechnologicalTechnological
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Major Business Pressures & Major Business Pressures & the Role of ECthe Role of EC
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Organizational ResponsesOrganizational Responses
Strategic Planning and SystemsProvide organizations with Provide organizations with strategic advantages, enabling strategic advantages, enabling them to:them to:
Increase their market shareBetter negotiate with their suppliersPrevent competitors from entering into their territory
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Organizational Responses Organizational Responses 22
Continuous improvement effortsMany companies continuously Many companies continuously conduct programs to improve:conduct programs to improve:
Productivity
Quality
Customer service
Business process reengineering (BPR)Strong business pressures may Strong business pressures may require a radical changerequire a radical change
Such an effort is referred to as Such an effort is referred to as business process reengineering business process reengineering (BPR)(BPR)
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Organizational Responses Organizational Responses 33
Business alliancesAlliances with other companies, even Alliances with other companies, even competitors, can be beneficialcompetitors, can be beneficial
Virtual corporation—Virtual corporation—electronically supported electronically supported temporary joint venturetemporary joint venture
Special organization for a specific time-limited mission
Electronic marketsOptimize trading efficiencyOptimize trading efficiency
Enable their members to compete globallyEnable their members to compete globally
Require the collaboration of the different Require the collaboration of the different companies and competitorscompanies and competitors
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Organizational Responses Organizational Responses 44
Reduction in cycle time and time to market
Cycle time reduction—shortening the Cycle time reduction—shortening the time it takes for a business to time it takes for a business to complete a productive activity from complete a productive activity from its beginning to endits beginning to end
Extremely important for increasing Extremely important for increasing productivity and competitivenessproductivity and competitiveness
Extranet-based applications Extranet-based applications expedite steps in the process of expedite steps in the process of product or service development, product or service development, testing, and implementationtesting, and implementation
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Organizational Responses Organizational Responses 55
Empowerment of employees and collaborative work
Employees given the authority to Employees given the authority to act and make decisions on their own act and make decisions on their own improves improves
Productivity Customer relationship management (CRM)
Empowered sales people and Empowered sales people and customer service employees:customer service employees:
Make customers happy quicklyHelp increase customer loyalty
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Organizational Responses Organizational Responses 66
Supply chain improvementsHelp reduce supply chain delays, Help reduce supply chain delays, inventories and eliminate other inventories and eliminate other inefficienciesinefficiencies
Mass customization—production of large quantities of customized items
Business problem is how to Business problem is how to efficiently provide customizationefficiently provide customization
EC is an ideal facilitator of mass EC is an ideal facilitator of mass customization by enabling customization by enabling electronic ordering to reach the electronic ordering to reach the production facility in minutesproduction facility in minutes
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Putting It All Together Putting It All Together
The first step is to put in the right connective networks
The vast majority of EC is done on computers connected to:
InternetInternet
Intranet--An internal corporate or government Intranet--An internal corporate or government network that uses Internet tools, such as Web network that uses Internet tools, such as Web browsers, and Internet protocolsbrowsers, and Internet protocols
Extranet--A network that uses the Internet to Extranet--A network that uses the Internet to link multiple intranetslink multiple intranets
© Farhan Mir© Farhan Mir
20200707 IMSIMS
Putting It All Together Putting It All Together
Major concern of today’s companies—how to transform themselves to take part in digital economy
Example:Toys, Inc.Uses intranet for internal Uses intranet for internal communications, collaboration, communications, collaboration, dissemination of informationdissemination of information
Networked to e-marketspaces and Networked to e-marketspaces and large corporationslarge corporations
Corporate portal for communication Corporate portal for communication and collaboration with business and collaboration with business partnerspartners
© Farhan Mir© Farhan Mir
20200707 IMSIMS
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