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Chapter 7

Intranet and Extranet

Intrabusiness E-Commerce at Toshiba America

Intranet doubled as dealer extranet 300 dealers needed parts quickly Orders placed by phone or fax by 2:00 in order to have next-day delivery Shipping fees expensive Cumbersome order-entry system created in 1993 with no significant improvement

Intrabusiness E-Commerce at Toshiba America

1997, Toshiba created a Web-based order-entry system using extranet/intranet Dealers lace orders for parts until 5:00 for nextday deliverymatter of hours to shipping Physical warehouse in Memphis, TN near FedEx headquarters ensures quick delivery Dealers also:
Check accounts receivable balances Pricing arrangements Read service bulletins, etc. 3

Figure 7-1 Toshibas Customer Service Process

Source: Compiled from Jones(1998). Used by permission.

Intrabusiness and Business-to-Employee (B2E) E-commerce (cont.)

Between and among corporate employees
Large organizations have classified ads on the intranet where employees can buy and sell products and services from each other Especially popular in universities Interconnect their intranets to increase exposure Employees collaborate and communicate using EC technologies 5

Architecture of the Internet, Intranet and Extranet

THE INTRANET is a public and global communication network that provides direct connectivity to anyone over a local area network (LAN) or Internet Service Provider (ISP). The Internet is a public network that is connected and routed over gateways. An Intranet is a corporate LAN or WAN that uses Internet technology and is secured behind companys firewalls. THE EXTRANET: An extranet, or extended intranet, uses the TCP/IP protocol networks of the Internet, to link intranets in different locations. Extranet provide secured connectivity between a corporations intranets and the intranets of its business partners, materials suppliers, financial services, government, and customers. 6

Characteristics of the INTERNET, Intranet and Extranet

Network Type Internet Typical Users Any individual with dialup access or LAN Authorized employees only Authorized groups from collaborating companies Access Unlimited public: no restrictions Private and restricted Type of Information General, public, and advertorial Specific, corporate, and proprietary



Private and Shared in authorized outside authorized partners collaborating groups

Intranetnetwork architecture designed to serve internal informational needs of a company using Web concepts and tools To build an intranet, we need Web server, browsers, web publishing tools, back-end databases, TCP/IP networks (LAN or WAN), and firewall. Provides:
Internet capabilities Search engines Tools for communication and collaboration 8

Intranets (cont.)
Cost of converting an existing network system to internal Web is relatively low Fairly safe within company firewalls
Employees can get out on the Web easily Outsiders cannot get into the intranet

Change organizational structures and procedures, help reengineer corporations 9

Figure 7-2 Architecture of an Intranet


Intranet Functionalities
Intranet functionalities
Corporate/department/individual Web pages Web-based database access for ease of use Search engines, indexing engines, directories assisted by keyword search Integration with EC: interface with Internetbased electronic sales and purchasing Interactive communication
Chatting Audio support Videoconferencing 11

Intranet Functionalities (cont.)

Document distribution and workflow
Web-based downloading Routing of documents

Groupware including
Enhanced e-mail Bulletin boards Screen sharing Other group support tools

Conduit for computer-based telephony system Extranet: linking geographically dispersed branches, customers, and suppliers to authorized sections of intranets creates happier customers, more efficient suppliers, and reduced staff costs. 12

Electronic Commerce Technologies


Intranet Applications
Intranet application areas
Electronic commerce Customer service Search and access to documents Personalized information Enhanced knowledge sharing Enhanced group decision and business processes 14

Intranets Applications (cont.)

Intranet application areas (cont.)
Empowerment Virtual organizations Software distribution Document management Project management Training Enhanced transaction processing Paperless information delivery Improved administrative processes 15

Intranet Functionalities
Industry-specific intranet solutions
Classified by industry instead of technology Development of business models is a critical concern for managerial success of intranets Top 100 intranet/extranet solutions classifications
Financial services Information technology Manufacturing Retail Services 16

Intranet Application (Case Studies)

Intranet case studies
Moen-connected ERP Compaq Computer Corp.investment assistant Silicon Graphics, Inc.share huge internal Web sites Coopers & Lybrandshare knowledge among corporate employees


Extranet combine the privacy and security of intranets with the global reach of the Internet, granting access to outside business partners, suppliers, and customers to a controlled portion of the enterprise network. Extranets are becoming the major platforms for B2B EC replacing or supplementing EDI. 18

The Structure of Extranets

Extranets are comprised of a wide variety of components and participants, and there are several possible configurations. These include intranet, Web servers, Firewall, ISPs tunneling technology, interface software and business applications. The tunneling means that data transmission across the internet can be made secure by authenticating and encrypting all IP packets.
Extranets are configured by two basic methods: They can be implemented using a direct leased line with full control over it, linking all intranets. A secure link (tunnel) can be created across the Internet, which can be used by the corporation as a VPN, usually at a much lower cost.


Extranet Products and Services

Four Categories of extranet products and services.
1. Extranet development tools: to design extranet servers, a clientbase, security, EC applications, and electronic catalogs. 2. Extranet hosting and network connectivity: provide secure ISP connections to Internet back bones and host extranet services for corporations. 3. Extranet services provide extranet design expertise with proprietary tools or turnkey services for building and operating extranet-based services for corporate clients. 4. Virtual private networks: provide components specifically design for connecting remote operators and creating IP WANs for corporations


Extranet tools and Services Providers

1. Consultants
2. Developers 3. System integration 4. Internet service provider 21

Applications of Extranets
BENEFITS OF EXTRANETS 1. Enhanced communication
Improved internal communication Improved business partnership channels Effective marketing, sales and customer support Collaborative activities support

2. Productivity enhancements
Just-in-time information delivery Reduction of information overload Productivity collaboration between work groups Training on demand 22

Applications of Extranets
3. Business enhancements
Faster time to market Simultaneous engineering potential Lower design and production costs Improved client relationships New business opportunities

4. Cost reduction
Reduced error Reduced travel and meeting Improved comparison shopping Reduced administrative and operational costs 23

Applications of Extranets
5. Information delivery

Low-cost publishing Leveraging of legacy systems Standard delivery systems Ease of maintenance and implementation Elimination of paper publishing and mailing costs.

INDUSTRY SPECIFIC EXTRANET SOLUTIONS The application of extranets are classified by industry. The popularly applied industries are information services, computers, financial services, travel, Industry/ manufacturing, business and professional, real estate and customers. 24

Managerial Issues
Find business opportunities by utilizing the intranet and extranet Analyze whether the connectivity requirement suits the intranet or extranet Plan the most secure and economical choice for implementation Select the best outsourcers for implementation Selling the intranet Finding intranet applications 25