1. Electronic Commerce

2. Foundations of Electronic Commerce (EC)
Interorganizational Information System (IOS)
Benefits and limitations of EC
Future of EC

3. Electronic Commerce
Electronic commerce (EC) is an emerging concept that describes the buying and selling of products, services and information via computer networks, including the Internet.

4. Interorganizational Information System
An interorganizational information system (IOS) involves information flow among two or more organizations. Its major objective is efficient transaction processing, such as transmitting orders, bills, and payments using electronic data interchange (EDI).

5. IOS and Electronic Markets
Drivers of IOS
Types of IOS
Electronic Markets (EM)

6. Drivers of IOS Reducing costs Improving the quality of information
Compressing cycle time
Eliminating paper
Making the trading process easy for users

7. Types of IOS Electronic data interchange (EDI)
Electronic funds transfer (EFT)
Integrated messaging
Shared databases

8. Benefits and Limitations of Electronic Commerce
Organizations
Consumers
Society
Limitations
Technical
Nontechnical

9. EC: Benefits to Organizations
Decreasing information costs
Reduced inventories
Reduced cycle time
Supports BPR
Lowers telecommunication costs

10. EC: Benefits to Consumers
More choice
Less expensive products
Quick delivery
24-hour availability
Quick access to information
Customized product at competitive prices
Virtual auctions
Interact with other EC customers

11. Limitations Technical
Lack of security
Insufficient telecommunication bandwidth
Software tools still evolving
Integration of internet and EC software
Special Web servers
Interoperability of software and hardware

12. Limitations Nontechnical
Accessibility
Legal issues
Government regulations
Difficult to measure benefits
EC still evolving
Customers resist change

13. Limitations Nontechnical
Insufficient support services
Perception that EC is expensive and insecure
EC has not obtained a critical mass of sellers and customers
EC - breakdown of human relationships

14. Business to Consumer Applications
Advertising, online publishing and push technology
Cyber banking, personal finance and stock trading
Job market, auctions, bids and bartering
Travel and real estate
Electronic retailing and malls

15. Push Technology
Push technology is an approach designed to deliver only the information users want or need.

16. Advertising, Online Publishing and Push technology
Own Web site
Other organization’s Web site
Electronic publisher’s Web site
EC vendors’ pages (Netscape or Yahoo)
Information kiosks
Electronic malls and metamalls
News groups

17. Personal Finance Bill paying Tracking bank accounts
Portfolio management
Investment tracking
Quotes
Budget organization
Tax computations
Retirement planning

18. The Job Market
Job seekers
Job offers
Recruiting firms

19. Auctions Auctioning cars to dealers Live online auctions Art auctions
Airlines

21. Business to Business Applications
Electronic Data Interchange (EDI)
Intranet commerce

22. Electronic Data Interchange (EDI)
EDI can be defined as the electronic movement of specially formatted standard business documents, such as orders, bills, and confirmations sent between business partners.

23. Electronic Data Interchange (EDI)
Business transactions messages
Data formatting standards
EDI translators
Private lines versus the Internet

25. Intranet Commerce Efficient transaction entry
Common transaction processing
Consistent internal controls

26. Intranet Examples
Credit Lyonnais
Harris
Industry Canada
Intel
Fujitsu

27. Intranet Examples Post AG Sun Microsystems Sparbanken Sverige AB
The Social Security Administration

28. The Customers Customers and their behavior Electronic commerce agents
Market research
Customer service
Electronic commerce agents
Bargain finder
Firefly and open sesame
Resume robot
Good stuff cheap
Negotiating agents

29. Customer Service: Life Cycle Approach
Phase 1: Requirements
Phase 2: Acquisition
Phase 3: Ownership
Phase 4: Retirement

30. Support and Implementation
Electronic commerce infrastructure
Electronic payments
Support services
Legal and security issues
Implementation issues

31. Electronic Commerce Infrastructure
Networks
Web servers
Web server supporting tools
Web page design
Transactional activities

32. Encryption
Encryption is the conversion of information into a form readable only with a decryption key.

33. Electronic Payments Obstacles
Limitations of traditional payment instruments
Public key, private key
Digital signature
Electronic certificates

34. Electronic Payments Secure electronic transaction protocol
Electronic cash
Electronic credit cards
Electronic checks
Electronic payment cards
Electronic funds transfer

35. Electronic Payments Obstacles
Lack of security
Handling micropayments
Inconvenience
Incompatibility

36. Limitations of Traditional Payment Instruments
Delay due to verification and authorization
Risk of loss or theft
Processing cost for micropayments too high
Less convenient
Cash payment necessitates meeting between buyer and seller

37. Limitations of Traditional Payment Instruments
Security risk
Not everyone accepts credit cards
Some buyers do not have credit cards

38. Support Services Examples
ConnectUS
The Global Business Alliance Incorporated
CommerceNet
BioMedNet
World Insurance Network

39. Support Services Examples
The Financial Services Technology Consortium and Smart Card Forum
Joint Transmission Services Information Network

40. Legal and Security Issues
Buyer protection
Fair credit billing act
Sellers protection
Legal aspects of EFT

41. Implementation Issues
Domain name
Web tracking
Taxes and fees
Copyright
Manipulating securities on the Internet
Security

42. Managerial Issues Managing resistance to change
Integration of electronic commerce into the business environment
Lack of qualified personnel and outsourcing
Alliances
Implementation plan
Privacy

43. Managerial Issues
Justifying electronic commerce by conducting cost-benefit analysis
The human element
Impact of EC
organizational structure
people
marketing procedures
profitability

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