Agenda Introduction A frame work and scope of E-

commerce Emergent Categories of E-commerce E-Business concepts Value Chain concept Stakeholders Summary

“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-Business?

The use of Internet technologies to work and empower business processes, electronic commerce, and enterprise collaboration within a company and with its customers, suppliers, and other business stakeholders.

An online exchange of value.

E-Business

eBusiness (electronic business) is, in its simplest form, the conduct of business on the Internet. It is a more generic term than eCommerce because it refers to not only buying and selling but also servicing customers and collaborating with business partners.

IBM, in 1997, first to use the term. Today, many corporations are rethinking their businesses in terms of the Internet and its capabilities.

E-Business

Companies are using the Web to buy parts and supplies from other companies, to collaborate on sales promotions, and to do joint research.

Exploiting the convenience, availability, and global reach of the Internet, many companies, both large and small have already discovered how to use the Internet successfully.

eCommerce (electronic commerce) is the buying and selling of goods and services on the Internet, especially the World Wide Web. In practice, this term and a newer term, eBusiness, are often used interchangeably.

However, it took about four years for security protocols to become sufficiently developed and widely deployed (during the browser wars of this period). Subsequently, between 1998 and 2000, a substantial number of businesses in the United States and Western Europe developed rudimentary web sites.

E-Commerce

Contemporary Definition

“Technology-mediated exchanges between parties (individual or organizations) as well as electronically based intra-or inter-organizational activities that facilitate such exchanges.”

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 vs. E-commerce

Three alternative definitions of the relationship

between e-business and e-commerce

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.)

service Business process Doing business electronically by

completing business processes over electronic networks, thereby substituting information for physical business processes

Service 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 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

Source: Choi et al. (1997), p. 18.

Dimensions of e-business/e-commerce

Regional Training Workshop for Enterprise Support Agencies to Promote E-business for SMEs in the Greater Mekong Subregion (GMS), 26-28 June 2006, Bangkok

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

Business-to-business (B2B) Business that sells products or provides services to other businesses

Business-to-consumer (B2C) Business that sells products or provides services to end-user consumers

Consumer-to-consumer (C2C) Consumers sell directly to other consumers

Types of e-business

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 online Mobile commerce (m-commerce) E-commerce transactions and activities conducted in a wireless environmentCollaborative commerce (c-commerce) Individuals or groups communicate or collaborate online

Types of e-business (cont.)

Evolution of e-business

1997: Introduction of a brand new phrase – e-business

1999: The emphasis of e-business shifted from B2C to B2B

2001: The emphasis shifted from B2B to B2E, c-commerce, e-government, e-learning, and m-commerce

2004: Total online shopping and transactions in the United States between $3 to $7 trillion

E-business will undoubtedly continue to shift and change

Evolution of e-business (cont.)

The FutureBy 2008: Number of Internet users worldwide should

reach 750 million 50 percent of Internet users will shop E-business growth will come more from:

B2C, B2B, e-government, e-learning, B2E, c-commerce

Traditional Purchasing Process Flow

Supply Chain

The supply chain is network of organizations and business processes for procuring materials, transforming raw materials into intermediate and finished products and distribution of products to customers.

close linkage and coordination of activities involved in buying, making, and moving a product

Integrates supplier, manufacturer, distributor, and customer logistics time

Reduces time, redundant effort, and inventory costs

Supply Chain

Customer / Supplier

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.

Major Players

Value Chain concept The value chain concept was developed

Michael Porter It views a firm a series, chain, or network

of basic activities that add value to its products and services, and thus add a margin of value both to the firm and customers.

How and Where information technologies can be applied to basic business processes using the value chain framework.

VALUE CHAIN MODEL

Highlights primary & support activities that add value to products, services where information systems/technologies can best be applied to achieve a competitive advantage.

Organizations have competitive advantage when they provide more value to their customer or when they provide same value to customer at lower price.

VALUE CHAIN MODEL

Primary activities Directly related to production, distribution of the

firm ‘s products and services that create value for the customer.

Support activities Make the delivery of the primary activities

possible and consist of organization infrastructure

Infrastructure, human resources, technology, procurement

Porter’s Generic Value Chain

ACTIVITIES OF THE VALUE CHAIN

Firm Value Chain

TYPES OF INFORMATION SYSTEMS

Value Web: Customer-driven network of

independent firms Uses information technology to

coordinate value chains for collectively producing a product or service

Business Level Strategy and the Value Chain Model

Concept of The Value Web

Figure 3-12

Major business pressures

E-business framework

E-Business does not affect an organization’s fundamental goals, rather it provides a new ways to achieve them:

E-business adoption strategy and direction. Vision must be communicated to all stakeholders The interaction among stakeholders Smaller network, more flexible organizations,

shifting priorities and roles Information system and technology infrastructure

Mechanism to improve, enrich, change, and deepen relationships with key stakeholders

Culture: Need to adapt the new way, will impact on rules, belief, norms, and behaviors

Summary

A concept of networked economy Information is an asset E-commerce a revolution in both

business and society Value chain differs across trade

sectors and between organizations within a trade sector.