Electronic Commerce

Lecture 14

Summary of Previous Lecture HTML: The Language of the Web Writing HTML

Notepad FileSaving notepad as HTML

HTML basic Format and TagsBasic TagsHeader TagAlignmentViewing Code using a browser

Summary of Previous LectureParagraphsMoving next line in HTMLListOrdered ListsOther Common tagsSpecial Characters using HTML Image insert in a webpageHTML TablesHyperlinks

Summary of Previous Lecture Front Page

Why to use FrontPage?Auto HTML CodeHow to start FrontPageHow to Create a Website

TemplatesFrontPage ViewsPreviewing a WebpageMeta Tags and getting Help from Front Page

Today’s Lecture Electronic Commerce definition. E-Commerce Infrastructure

Related Definitions

Dimensions of Electronic Commerce Product Process Delivery Agent

Commerce Differences E-Commerce Field

Today’s LecturePeoplePublic PolicyTechnical standards and ProtocolsOrganization

Electronic Market Types of E-Commerce

Business to Consumer Business to BusinessConsumer to Consumer

Today’s LecturePerson to PersonConsumer to BusinessBusiness to EmployeeG2G (Government-to-Government), G2E (Government-to-Employee), G2B (Government-to-Business), B2G (Business-to-Government), G2C (Government-to-Citizen)

Today’s Lecture Types of Inter organizational systems

Electronic data interchange (EDI) Extranets Electronic funds transfer (EFT) Integrated messaging systems Shared databases Electronically-supported supply chain management

Benefits of E-Commerce Benefits to organization Benefit to customers Benefits to society

Today’s Lecture Limitations of E-Commerce Summary

Introduction Businesses

(organizations) have always used the prevailing and emerging technologies to help fulfill their missions

Networked computers, today’s prevailing technology, have become one of the most influential technologies in civilization’s history.

1. Negate the importance of the “boundaries” associated with time, space, and size.

2. Facilitate instantaneous communications

Introduction

Introduction The Internet allows an organization of any

size to exchange information at the speed of light, with anyone, anywhere, anytime.

(Assuming that all parties to the information exchange have “unconstrained” broadband connections.)

Electronic Commerce is the Solution for all!

Electronic Commerce Electronic commerce is concerned with

the buying and selling of products and services using

telecommunication

network, especially

the internet.

E-Commerce InfrastructureThe infrastructure for EC is a networked

computing environment in business, home, and government.

A global networked environment is known as the Internet

A counterpart within organizations, is called an intranet

An extranet extends intranets so that they can be accessed by business partners.

Definitions and Content of Field

E-Commerce Example Website

Dimensions of Electronic Commerce

E-Commerce Work in three dimensionsThe product (OR service)

Can be sold physically or over the internet (digitally)

The process Can also be physical or digital

The delivery agent (or intermediary) Delivery agent can work both in Physical or digital

medium.

Example- The Product Product can be sold out at some physical

market place.For example shopping from the marketElectric repair service etc.

Shopping Mall in Pakistan

Example– The Product Digital products can be downloaded or

bought on CD.For example downloading latest Windows

Version from Microsoft Website.Downloading a book from Amazon. COM

The Process Process can be viewed as a sequence of

activities to accomplish certain task. A business process or business

method is a collection of related, structured activities or tasks that produce a specific service or product (serve a particular goal) for a particular customer or customers.

Example – Physical Process In shoe industry, different processes are

done physically to make a shoe. This may include, selection of suitable leather, stitching, polishing, etc.

There may be several processes within a process to accomplish certain task.

Many processes are involved from taking raw material from the market, making of a shoe and delivering it to the customers.

Example – Digital Process Using a website when customer places an

order, digital process is involved in between to deliver the product.

Customer order handling process

The Delivery Agent -- Example Physical delivery agent example includes

a Postmaster delivering letters to homes. Mail delivery agent is a digital program to

deliver the e-mail messages to a local recipient mailbox.

Problem delivering letters when on strike

Available 24 hours

Commerce differences Traditional commerce

all dimensions are physical Pure EC

all dimensions are digital Partial EC

all other possibilities include a mix of digital and physical dimensions

Physical agent

Digital agent

Digital Product

Physical Product Physical process

Digital process

Virtual process

Virtual delivery agent

Vir

tual

pro

du

ctElectronic commerce areas

The core of electronic commerce

The Dimensions of Electronic Commerce

Traditional commerce

EC applications are supported by infrastructures, and their implementation is dependent on four major areas (supporting pillars)

people, public policy, technical standards and protocols, and other organizations.

The Electronic Commerce Field

EC Management

The EC management coordinates the applications, infrastructures, and pillars. It also includes Internet marketing and advertisement.

A Framework for Electronic Commerce 9

Electronic Commerce Applications

• Stocks Jobs • On-line banking

• Procurement and purchasing• Malls • On-line marketing and advertising

• Home shopping • Auctions • Travel • On-line publishing

People:

Buyers, sellers,

intermediaries,

services, IS people,

and management

Public

policy,

legal, and

privacy

issues

Technical standards

for documents,

security, and

network protocols

payment

Organizations:

Partners,

competitors,

associations,

government services

Infrastructure

(1)

Common business

services infrastructure

(security smart

cards/authentication

electronic payment,

directories/catalogs)

(2)

Messaging and

information distribution

infrastructure

(EDI, e-mail, Hyper Text

Transfer Protocol)

(3)

Multimedia content

and network

publishing infrastructure

(HTML, JAVA, World

Wide Web, VRML)

(4)

Network infrastructure

(Telecom, cable TV

wireless, Internet)

(VAN, WAN, LAN,

Intranet, Extranet)

(5)

Interfacing

infrastructure

(The databases,

customers, and

applications)

Management© Prentice Hall, 2000

The People People in electronic commerce are,

Software developersUsers of software

Which include buyer, sellers, intermediaries

How e-commerce is changing people?

In the past going shopping was fun, something that you did with your friends or relatives. It was a social event.

Today, Facebook and other social media networks are the driving force behind online shopping. Companies target potential customers and online communities.

They advertise their brands and products in the right way people will talk about them, and news spreads throughout the online world much quicker than in the real world.

Public Policy Policies like shipment of products, update

of different features of products, online sale and purchase are now being developed as per e-commerce needs.For example Intellectual property rights

policies.

Technical standards and Protocols

A technical standard is an established norm or requirement about technical systems.

Standards can also be developed by groups such as trade unions, and trade associations to establish electronic commerce.For example standards for buying raw

material and selling quality products, etc.

Organization It is a social group which distributes tasks for a

collective goal. Different forms of organizations include

Corporations Government Non-Government International Charity etc.

An essential pillar of E-Commerce framework.

Electronic Markets Market: A market is a network of

interactions and relationships where information, products, services, and payments are exchanged.

The market handles all the necessary transactions.

An electronic market is a place where shoppers and sellers meet electronically.

Electronic Markets In electronic markets, sellers and buyers

negotiate, submit bids, agree on an order, and finish the execution on- or off-line.

11

Shopper/Purchaser Seller/Supplier

Electronic Market

(Transaction Hander)

Electronic commerce

network

(Infrastructure)

Product/service information request

Purchase request

Payment or payment advicePurchase fulfillment request

Purchase change request

Response to fulfillment request

Shipping notice

Payment approval

Electronic transfer of funds Electronic transfer of funds

Shopper/Purchaser’s Bank

Payment remittance notice

Electronic transfer of funds

Transaction Handler’s Bank

(Automated Clearing House)

Seller/Supplier’s Bank

Electronic Markets© Prentice Hall, 2000

Response to information request

Purchase acknowledgment

Shipping notice

Purchase/service delivery (if online)

Payment acknowledgment

Types of E-Commerce E-Commerce can be classified into several

different types, includingBusiness to Consumer Business to BusinessConsumer to Consumer Person to PersonConsumer to BusinessBusiness to Employee

Other TypesG2G (Government-to-Government), G2E (Government-to-Employee), G2B (Government-to-Business), B2G (Business-to-Government), G2C (Government-to-Citizen)

Business to Consumer E-Commerce

Business to Consumer (B2C) is the most commonly form of e-commerce, where a business sells goods and services to consumers for their personal use and consumption.

Business to Business Business to Business (B2B) e-commerce

focuses on transactions between businesses.For example supply of raw material from one

company to another. All relevant information

is shared between computers using e-commerce.

Consumer to Consumer Consumer to Consumer (C2C) e-commerce gives

individuals an opportunity to sell items to others using an intermediary, such as e-bay.com, amazon.com, olx.com.pk.

The seller is responsible for preparing the goods for sale, placing the ad for the product at the online auction or trading site, and shipping the goods.

The market intermediary is responsible for maintaining the site, including the search engine through which buyers locate the product for sale, and processing the payments, both from the buyer and to the seller.

Example – A C2C Website

Person to Person Person to Person (P2P) technology allows users

of the Internet to share files and computer resources directly, without going through a Web server.

However, since the file sharing is supposed to be provided free of charge, the challenge is to make enough money to keep the P2P site operating.

The most famous P2P file-sharing site in recent history is Napster.com.

Consumer to Business Consumers create value and firm confirms

its value.For example, when a consumer writes

reviews, or when a consumers gives a useful idea for new product development, then this individual is creating value to the firm, if the firm adopts the input.

Business to Employee It uses an intra-business network which allows

companies to provide products and/or services to their employees

Typically, companies use B2E networks to automate employee-related corporate processes, this may include Online insurance policy management Corporate announcement dissemination Online supply requests Special employee offers Employee benefits reporting etc

Electronic Business E-Business describes the broadest

definition of EC. It includes customer service and intra business tasks. It is frequently used interchangeably with EC

Other types G2G (Government-to-Government)

An online non-commercial interaction between Government organizations, departments, and authorities and other Government organizations, departments, and authorities.

G2E (Government-to-Employee)An online interactions through instantaneous

communication tools between government units and their employees.

Other Types G2B (Government-to-Business)

An online non-commercial interaction between local and central government and the commercial business sector, with the purpose of providing businesses information and advice on e-business etc.

Other Types B2G (Business-to-Government)

B2G networks provide a platform for businesses to bid on government auctions etc.

G2C (Government-to-Citizen), It offers communication link between a

government and private individuals or residents.

An interorganizational information system (IOS) involves information flow among two or more organizations. Its major objective is efficient routine

transaction processing, such as transmitting orders, bills, and payments.

A typical IOS includes a company and its suppliers and and/or customers.

Interorganization Information Systems

Electronic data interchange (EDI)ExtranetsElectronic funds transfer (EFT)Integrated messaging systemsShared databasesElectronically-supported supply chain

management

Types of Interorganizational Systems

Electronic data interchange (EDI)

It is used to transfer electronic documents or business data from one computer system to another computer system, i.e. from one trading partner to another trading partner without human intervention.

It is termed as the structured transmission of data between organizations by electronic means.

Extranets

Used in B2B e-commerce model. An extranet is a computer network that

allows controlled access from the outside, for specific business or educational purposes. It is not accessible to general public.Available over internet

Electronic funds transfer (EFT)

It is the electronic exchange or transfer of money from one account to another, either within a single financial institution or across multiple institutions, through computer-based systems i.e.; e-commerce.

Integrated messaging systems

It is the integration of different electronic messaging and communications media (e-mail, SMS, Fax, voicemail, video messaging, etc.) technologies into a single interface, accessible from a variety of different devices.

Different organizations may integrate shared messages using this technology.

Shared databases Databases can be shared between

organizations for collective benefits.For example, National Health Informatics

system integrate nation wide health database of patients.

A patient may go to anywhere in the country for checkup. Previous history of medications and findings will be available to the doctors.

Supply Chain Management It is concerned with the supply of raw

material, manufacturing of products and provide this to consumers.

E-Commerce offers wide range of software solutions for online supply chain management.

The Benefits of Electronic Commerce

Expands the marketplace to national and international markets

Decreases the cost of creating, processing, distributing, storing and retrieving paper-based information

Lowers telecommunications cost - the Internet is much cheaper than value added networks (VANs)

Benefits to Organizations

Benefits to Customers Enables customers to shop or do other transactions

24 hours a day, all year round from almost any location

Provides customers with more choices Provides customers with less expensive products and

services by allowing them to shop in many places and conduct quick comparisons

Allows quick delivery of products and services in some cases, especially with digitized products

Benefits to Society

Enables more individuals to work at home, and to do less traveling for shopping, resulting in less traffic on the roads, and lower air pollution

Allows some merchandise to be sold at lower prices benefiting the poor ones

Enables people in under developed countries and rural areas to enjoy products and services which otherwise are not available to them

Facilitates delivery of public services at a reduced cost,increases effectiveness, and/or improves quality

E-Commerce LimitationsLack of sufficient system’s security, reliability,

and standards. Insufficient telecommunication bandwidthCost of developing an E-Commerce Solutions

is often very high.Often customers do not trust investing online.Many unresolved legal issues.

Benefits of E-Commence

You Do not need to stand in a line to pay bills any more!

Summary Today we have learnt,

E-Commerce definitionDimensions of E-CommerceTypes of E-commerceE-MarketsTypes of inter organizational systemsBenefits of E-Commerce