E-Business

• The Practice of performing and co-ordination

critical business process such as designing
products, obtaining raw material from
suppliers, manufacturing, selling, fulfilling
orders and providing services through the
extensive use of computer & communication
technologies and computerized data.
– E-business does NOT equal the Internet, though the
growth of the Internet acted as a very powerful
catalyst

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 E-business VS E-commerce
• e-Business
– A company that has an online presence
• e-commerce businesses allow customers to
buy, sell, and trade over the Web

E-Business E-Commerce
 Information System
• An information system is a work system
whose business process is devoted to
capturing, transmitting, storing, retrieving
manipulating and display information thereby
supporting other work systems.

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 The Value Chain
• The set of processes used by a firm to create
value for its customers. Includes:
– Primary processes – directly create the value as
perceived by the customers
– Support processes – indirectly create value by
supporting the primary processes

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EDI – ELECTRONIC DATA INTERCHANGE
Electronic data interchange (EDI) was one of the earliest uses of
information technology for supply chain management. EDI involves
the electronic exchange of business transaction documents over the
Internet and other networks between supply chain trading partners
(organizations and their customers and suppliers). Data representing
a variety of business transaction documents (such as purchase
orders, invoices, requests for quotations, and shipping notices) are
automatically exchanged between computers using standard
document message formats. Typically, EDI software is used to
convert a company’s own document formats into standardized EDI
formats as specified by various industry and international protocols.
Thus, EDI is an example of the almost complete automation of an e-
commerce supply chain process. EDI over the Internet, using secure
virtual private networks , is a growing B2B e-commerce
application. 5
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 E-commerce
The process of buying, selling and marketing the
Products / Services using internet Technologies.
Any internet visitor can access information about
a product, place an order, make electronic
payments to commit the order, and in some cases
can receive products or services using computers.
E-commerce is the part of e-business that the
customer experiences directly
 E-commerce Categories
• Business to Business (B2B)
– Sales of goods and services among business
• Business to Customer (B2C)
– Retailing products and services
• Customer to Customer (C2C)
– Individuals use web for sale and service
• Government to Customer (G2C)
 E-Commerce Architecture
Most of the information technologies and Internet
technologies are involved in e-commerce systems as clear
from the following figure , which gives an example of the
technology resources required by many e-commerce systems.
The figure illustrates some of the hardware, software, data,
and network components used by a compny to provide
business-to-business (B2B) online auction e-commerce
services.

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 Advantages of E-Commerce
The advantages of e-commerce allow a business of virtually
any size that is located virtually anywhere on the planet to
conduct business with just about anyone, anywhere.
The power of e-commerce allows geophysical barriers to
disappear, making all consumers and businesses on earth
potential customers and suppliers.

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 Advantages of E-Commerce
The advantages of e-commerce allow a business of virtually
any size that is located virtually anywhere on the planet to
conduct business with just about anyone, anywhere.
Imagine a small olive oil manufacturer in a remote village in
Italy selling its wares to major department stores and
specialty food shops in large metropolitan markets of
various parts of the world . The power of e-commerce allows
geophysical barriers to disappear, making all consumers and
businesses on earth potential customers and suppliers.

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 Advantages of E-Commerce
 Barrier to Entry are Low
 Global Presence / Global Choice
 Improved Competitiveness / Quality of Service
 Mass Customization / Personalized Products and
Services
 Substantial Cost Savings / Substantial Price
Reductions
 Novel Business Opportunities / New Products and
Service

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E-Commerce Risks

 Confidentiality

 Integrity

 Availability

 Authentication & Nonrepudiation

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Confidentiality
Potential consumers are concerned about providing unknown
vendors with personal, sometimes sensitive information.
Connecting to the internet via a browser requires running
software on the computer that has been developed by some
one unknown to the organization.

Integrity
Data, both in transit and storage, could be susceptible to
unauthorized alteration or deletion

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Availability
The internet holds out the promise of doing business on a 24-
hour, seven days-a-week basis. Hence, high availability is
important with any systems failure becoming immediately
apparent to customers or business pattern.
Authentication & Nonrepudiation
The parties to an electronic transaction should be in a known
and trusted business relationship, which requires that they
prove their respective identities before executing the
transaction. Then, after the fact, there must be some manner of
ensuring that the transacting parties cannot deny that the
transaction was entered into and terms on which it was
completed.
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E-Commerce Risk

Sabotage or Defacement:
Unauthorized access:
Degradation of performance:

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Sabotage or Defacement:
All the business transactions and deals going on
through online methods, you being a businessman
can also face the problem of attacks. There are
different malicious attacks like – virus, worms
and Trojan horse, that your system can be a pray
to. You should always have a good anti-virus and
keep it updated to impede any such kinds of
attacks.

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Unauthorized access: While you may not be aware of
and trust your employees the best, you might never
know who accesses your data and account illegally.
Unauthorized access to your data can also be done by
outsiders. Poor configuration of systems and poor
encrypted transmission are few factors that can let
others access your confidential business data illegally.
You must also be careful to choose strong passwords,
and avoid hint questions like – ‘maiden name of your
mother’ or ‘school you went to’. In most cases you
can form your own question. Do that wherever
applicable; and if not try choosing your hint questions
in a way that will not let anyone guess it or know it. .
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Degradation of performance: Machines make our
life easier, and technology makes it luxurious. But
even technology is bounded by certain barriers. Busy
network, with heavy traffic is a common problem.
Hardware and software can also cause you troubles
at any time; yes, might also be when you are on a
major transaction. Your processor speed and data
storage might also pose as a problem for degradation
of your system’s performance.

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CRM
CRM uses information technology to create a cross-
functional enterprise system that integrates and
automates many of the customer-serving processes
in sales, marketing, and customer services that
interact with a company’s customers.
CRM systems include a family of software modules
that provides the tools that enable a business and its
employees to deliver fast, convenient, dependable,
and consistent service to its customers.

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CRM

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THREE PHASES - CRM

• Acquire. CRM software help to acquire new

customers by doing a superior job of contact
management, sales prospecting, selling, direct
marketing, and fulfillment. The goal of these CRM
functions is to help customers to perceive the value of
a superior product offered by an outstanding
company.

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THREE PHASES - CRM
• Enhance . Web-enabled CRM account management
and customer service and support tools help to keep
customers happy by supporting superior service from
a
responsive networked team of sales and service
specialists and business partners. In addition, CRM
sales force automation and direct marketing and
fulfillment tools also help companies in cross-selling
and up-selling to their customers, thus increasing their
profitability to the business. The value the customers
perceive is the convenience of one-stop shopping at 24
THREE PHASES - CRM
• Retain . CRM analytical software and databases
help a company proactively identify and reward its
most loyal and profitable customers to retain and
expand their business via targeted marketing and
relationship marketing programs. The value the
customers perceive is of a rewarding personalized
business relationship with “their company.”

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BENEFITS - CRM
•CRM allows a business to identify and target its best
customers—those who are the most profitable to the business
so they can be retained as lifelong customers for greater and
more profitable services.
•It makes possible real-time customization and personalization
of products and services based on customer wants, needs,
buying habits, and life cycles.
•CRM can also keep track of when a customer contacts the
company, regardless of the contact point.
•In addition, CRM systems can enable a company to provide a
consistent customer experience and superior service and
support across all the contact points a customer chooses.
All of these benefits would provide strategic business value to a
company and major customer value to its customers. 26
CRM - FAILURE
The common wisdom of why CRM systems fail includes:
• Lack of senior management sponsorship
• Improper change management
• Elongated projects that take on too much, too fast
• Lack of or poor integration between CRM and core
business systems
• Lack of end-user incentives leading to poor user adoption
rates

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A successful SCM strategy is based on accurate
order processing, just-in-time inventory
management, and timely order fulfillment.
supply chain management helps a company get
the right products to the right place at the right
time, in the proper quantity and at an acceptable
cost. The goal of SCM is to manage this process
efficiently by forecasting demand; controlling
inventory; enhancing the network of business
relationships a company has with customers,
suppliers, distributors, and others; and receiving
feedback on the status of every link in the supply
chain.

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To achieve this goal, many companies today are turning to
Internet technologies to Web-enable their supply chain
processes, decision making, and information flows.
Supply Chain Management is a cross-functional inter-
enterprise system that uses information technology to help
support and manage the links between some of a company’s
key business processes and those of its suppliers, customers,
and business partners. The goal of SCM is to create a fast,
efficient, and low-cost network of business relationships, or
supply chain , to get a company’s products from concept to
market.
Supply chain management software and Internet technologies
can help companies reengineer and integrate the functional
SCM processes that support the supply chain life cycle. 30
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ERP – ENTERPRISE RESOURCE PLANNING
ERP serves as a cross-functional enterprise backbone that
integrates and automates many internal business processes and
information systems within the manufacturing, logistics,
distribution, accounting, finance, and human resource
functions of a company.
Enterprise resource planning is a cross-functional enterprise
system driven by an integrated suite of software modules that
supports the basic internal business processes of a company.
ERP gives a company an integrated real-time view of its core
business processes, such as production, order processing, and
inventory management, tied together by the ERP application
software and a common database maintained by a database
management system.
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The major application components of enterprise resource planning
demonstrate the cross functional approach of ERP systems.

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The business processes and functions supported by the ERP system
implemented by the Colgate- Palmolive Company.

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ERP – BENEFITS
• Quality and efficiency .
ERP creates a framework for integrating and improving a
company’s internal business processes that results in
significant improvements in the quality and efficiency of
customer service, production, and distribution.
• Decreased costs .
Many companies report significant reductions in transaction
processing costs and hardware, software, and IT support staff
compared to the nonintegrated legacy systems that were
replaced by their new ERP systems.

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ERP – BENEFITS
• Decision support .
ERP provides vital cross-functional information on business
performance to managers quickly which significantly improve
their ability to make better decisions in a timely manner across
the entire business enterprise.
• Enterprise agility .
Implementing ERP systems breaks down many former
departmental and functional walls of business processes,
information systems, and information resources which results
in more flexible organizational structures, managerial
responsibilities, and work roles, and therefore a more agile and
adaptive organization and workforce that can more easily
capitalize on new business opportunities.
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Typical costs of implementing a new ERP system.

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