Introduction to eManagement Being Digital: the implications of the internet for businesses and organizations MGMT 230 Week 1

After this class you will be able to... Understand some of the implications of the internet for businesses and other organizations Define eBusiness and eCommerce (and eManagement) Explain some of the benefits and challenges of eBusiness

So, what is eManagement? Electronic Management leverages the power of online technology to effectively operate and manage a business, not- for-profit or public sector service. Can we do it faster, cheaper, or better using Internet technology? eManagement can play a role in – reducing costs – improving product or service quality – reaching new customers or suppliers – creating new ways of selling or providing existing products and services Now, after 20+ years of the commercial internet, almost all management is eManagement D. Chaffey. eBusiness & eCommerce Management. Prentice Hall. 2011

eBusiness - not just shopping! eBusiness is “the transformation of key business processes through the use of Internet technologies“ The terms e-business and e-commerce often used interchangeably. However they can be distinguished. – e-business is a broad terms that refers to the conduct of any aspect of a business over the Internet. It includes: Buy-side eCommerce transactions with suppliers, and sell-side eCommerce transactions with customers many other activities such as research & development, marketing, manufacturing, e-procurement, customer relationship and supply chain management. It also encompasses e-government services and employee services.. D. Chaffey. eBusiness & eCommerce Management. Prentice Hall. 2011

eCommerce e-commerce is a narrower term than eBusiness and focuses on transactions mediated by the internet – Financial transactions (buying and selling) – Non-financial transaction (requests for information, customer support etc) Buy-side e-commerce refers to transactions to procure resources needed by an organization from its suppliers. Sell-side e-commerce refers to transactions involved with selling products to an organization’s customers D. Chaffey. eBusiness & eCommerce Management. Prentice Hall. 2011

Ways in which the Internet impacts business Reduces asymmetry of information – Empowers the customer – Shift towards transparency Reduces friction in transactions Collapses the value/supply chain (disintermediation) Challenges traditional pricing, business models, and legal frameworks (particularly where there is digitization) D. Chaffey. eBusiness & eCommerce Management. Prentice Hall. 2011

Benefits of e-business to companies? Expanded marketplace - for both customers and suppliers Large savings possible by switching from paper to electronic systems for information exchange, retrieval, and transaction processing Increased productivity through information and resource sharing Supply chain inefficiencies can be minimized (Dell model of mass customization and pull-type processing ie. don’t make it until someone asks for it) D. Chaffey. eBusiness & eCommerce Management. Prentice Hall. 2011

Benefits of e-business to companies (cont’d) Allows for innovative (and disruptive)business models Increased market reach allows for a high degree of specialization (especially in retail) Lower telecommunication costs. Reduced business cycle time and admin costs in dealing with suppliers Customer Relationship Management software and the use of “big data” allows closer interaction with customers, and allows types of market research not otherwise possible. D. Chaffey. eBusiness & eCommerce Management. Prentice Hall. 2011

Challenges of e-business for companies Expanded competition – low barriers to entry Customer power has increased Network security Reliability of website technologies and network uptime and speed – these issues become more and more important as companies switch mission-critical applications and services to the web Back office integration (especially with legacy systems) Expense of infrastructure and uncertainties over return- on-investment (ROI) D. Chaffey. eBusiness & eCommerce Management. Prentice Hall. 2011

Challenges of e-business for companies (cont’d) Lack of in-house expertise (outsourcing is common, but managers may lack expertise to make good decisions) Rapid changes in technology make it hard to know when to “leap in” and invest Difficulty in establishing customer trust in a virtual world Cross border transactions/sales territory agreements D. Chaffey. eBusiness & eCommerce Management. Prentice Hall. 2011