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.
 E-Commerce
 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.
 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-business vs. E-commerce
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 and e-commerce

Three alternative definitions of the relationship

between 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

Dimensions of e-business/e-commerce

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

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
 Types of e-business
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 (cont.)
Business-to-government (B2G)
Government buys or provides goods, services or
information to/from businesses or individual
citizens
Business-to-employee (B2E)
Information and services made available to
employees online
Mobile commerce (m-commerce)
E-commerce transactions and activities
conducted in a wireless environment
Collaborative commerce (c-commerce)
Individuals or groups communicate or
collaborate online
 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 Future
By 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
 Business Level Strategy and the Value
Chain Model

Value Web:
 Customer-driven network of independent
firms
 Uses information technology to coordinate
value chains for collectively producing a
product or service
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.