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4.1 © 2002 by Prentice Hall c h a p t e r 4 4 THE DIGITAL FIRM: ELECTRONIC COMMERCE & ELECTRONIC COMMERCE & ELECTRONIC BUSINESS.

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Presentation on theme: "4.1 © 2002 by Prentice Hall c h a p t e r 4 4 THE DIGITAL FIRM: ELECTRONIC COMMERCE & ELECTRONIC COMMERCE & ELECTRONIC BUSINESS."— Presentation transcript:

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2 4.1 © 2002 by Prentice Hall c h a p t e r 4 4 THE DIGITAL FIRM: ELECTRONIC COMMERCE & ELECTRONIC COMMERCE & ELECTRONIC BUSINESS

3 4.2 © 2002 by Prentice Hall LEARNING OBJECTIVES EXPLAIN HOW INTERNET TRANSFORMS BUSINESSEXPLAIN HOW INTERNET TRANSFORMS BUSINESS COMPARE CATEGORIES OF ELECTRONIC COMMERCECOMPARE CATEGORIES OF ELECTRONIC COMMERCE EVALUATE PRINCIPAL ELECTRONIC PAYMENT SYSTEMSEVALUATE PRINCIPAL ELECTRONIC PAYMENT SYSTEMS* © 2002 by Prentice Hall

4 4.3 LEARNING OBJECTIVES DEMONSTRATE HOW INTERNET TECHNOLOGY SUPPORTS ELECTRONIC BUSINESS, SUPPLY CHAIN MANAGEMENTDEMONSTRATE HOW INTERNET TECHNOLOGY SUPPORTS ELECTRONIC BUSINESS, SUPPLY CHAIN MANAGEMENT EXAMINE CHALLENGES OF INTERNET TO BUSINESS & SOCIETYEXAMINE CHALLENGES OF INTERNET TO BUSINESS & SOCIETY* © 2002 by Prentice Hall

5 4.4 MANAGEMENT CHALLENGES EMERGING DIGITAL FIRMEMERGING DIGITAL FIRM ELECTRONIC COMMERCEELECTRONIC COMMERCE ELECTRONIC BUSINESSELECTRONIC BUSINESS CHALLENGES & OPPORTUNITIESCHALLENGES & OPPORTUNITIES*

6 4.5 © 2002 by Prentice Hall MANAGEMENT CHALLENGES 1. ELECTRONIC COMMERCE & ELECTRONIC BUSINESS REQUIRE NEW MIND SET 2. FINDING SUCCESSFUL INTERNET BUSINESS MODEL *

7 4.6 © 2002 by Prentice Hall INTERNET TECHNOLOGY & THE DIGITAL FIRM INFORMATION TECHNOLOGY INFRASTRUCTURE: Information flows seamlessly throughoutINFORMATION TECHNOLOGY INFRASTRUCTURE: Information flows seamlessly throughout DIRECT COMMUNICATION BETWEEN TRADING PARTNERS: DISINTERMEDIATION removes intermediate layers streamlines processDIRECT COMMUNICATION BETWEEN TRADING PARTNERS: DISINTERMEDIATION removes intermediate layers streamlines process*

8 4.7 © 2002 by Prentice Hall INTERNET TECHNOLOGY & THE DIGITAL FIRM VENDORS CAN PROVIDE INFORMATION 24 HOURS A DAYVENDORS CAN PROVIDE INFORMATION 24 HOURS A DAY CAN EXTEND DISTRIBUTION CHANNELSCAN EXTEND DISTRIBUTION CHANNELS CAN REDUCE TRANSACTION COSTSCAN REDUCE TRANSACTION COSTS*

9 4.8 © 2002 by Prentice Hall INTERNET TECHNOLOGY & THE DIGITAL FIRM REDUCES INFORMATION ASYMMETRY: Asymmetry exists when one party has more information than otherREDUCES INFORMATION ASYMMETRY: Asymmetry exists when one party has more information than other INCREASES RICHNESS: Depth & detail of informationINCREASES RICHNESS: Depth & detail of information INCREASES REACH: Number of people contactedINCREASES REACH: Number of people contacted*

10 4.9 © 2002 by Prentice Hall INTERNET BUSINESS MODELS VIRTUAL STOREFRONT: Sells goods, services on-lineVIRTUAL STOREFRONT: Sells goods, services on-line MARKETPLACE CONCENTRATOR: Concentrates information from several providersMARKETPLACE CONCENTRATOR: Concentrates information from several providers ON-LINE EXCHANGE: Bid-ask system, multiple buyers, sellersON-LINE EXCHANGE: Bid-ask system, multiple buyers, sellers*

11 4.10 © 2002 by Prentice Hall INFORMATION BROKER: Provide info on products, pricing, etc.INFORMATION BROKER: Provide info on products, pricing, etc. TRANSACTION BROKER: Buyers view rates, terms from various sourcesTRANSACTION BROKER: Buyers view rates, terms from various sources AUCTION: Electronic clearinghouse products, prices, change in response to demandAUCTION: Electronic clearinghouse products, prices, change in response to demand* INTERNET BUSINESS MODELS

12 4.11 © 2002 by Prentice Hall REVERSE AUCTION: Buyer sets price, submits to multiple sellersREVERSE AUCTION: Buyer sets price, submits to multiple sellers AGGREGATOR: Group pools orders for volume discountAGGREGATOR: Group pools orders for volume discount DIGITAL PRODUCT DELIVERY: Sell, download software, other digital productsDIGITAL PRODUCT DELIVERY: Sell, download software, other digital products* INTERNET BUSINESS MODELS

13 4.12 © 2002 by Prentice Hall CONTENT PROVIDER: Creates revenue through providing client for a fee, and advertisingCONTENT PROVIDER: Creates revenue through providing client for a fee, and advertising ON-LINE SERVICE PROVIDER: Provides service, support for hardware, software productsON-LINE SERVICE PROVIDER: Provides service, support for hardware, software products VIRTUAL COMMUNITY: Chat room, online meeting placeVIRTUAL COMMUNITY: Chat room, online meeting place* INTERNET BUSINESS MODELS

14 4.13 © 2002 by Prentice Hall PORTAL: Initial point of entry to Web, specialized content, servicesPORTAL: Initial point of entry to Web, specialized content, services SYNDICATOR: Aggregate information from several sources sold to other companiesSYNDICATOR: Aggregate information from several sources sold to other companies* INTERNET BUSINESS MODELS

15 4.14 © 2002 by Prentice Hall ELECTRONIC COMMERCE BUSINESS-TO-CONSUMER (B2C)BUSINESS-TO-CONSUMER (B2C) BUSINESS-TO-BUSINESS (B2B)BUSINESS-TO-BUSINESS (B2B) CONSUMER-TO-CONSUMER (C2C): Individuals use Web for private sales or exchangeCONSUMER-TO-CONSUMER (C2C): Individuals use Web for private sales or exchange*

16 4.15 © 2002 by Prentice Hall BUSINESS-TO-CONSUMER WEB SITES: Provide information on products, services, prices, ordersWEB SITES: Provide information on products, services, prices, orders CUSTOMER-CENTERED RETAILING: Closer, yet more cost-effective relationship with customersCUSTOMER-CENTERED RETAILING: Closer, yet more cost-effective relationship with customers INFORMATION BROKERS: Comparison shops to customer’s requirements, reintermediationINFORMATION BROKERS: Comparison shops to customer’s requirements, reintermediation*

17 4.16 © 2002 by Prentice Hall BUSINESS-TO-BUSINESS ELECTRONIC COMMERCE AUTOMATION OF PURCHASE, SALE TRANSACTIONS FROM BUSINESS TO BUSINESS PROVIDES ALTERNATIVE SOURCESPROVIDES ALTERNATIVE SOURCES ELECTRONIC HUBS: Online marketplaces, point-to-point connections, integrated informationELECTRONIC HUBS: Online marketplaces, point-to-point connections, integrated information*

18 4.17 © 2002 by Prentice Hall BUSINESS-TO-BUSINESS ELECTRONIC COMMERCE EXCHANGES: Commercial on-line market, many buyers, sellers POTENTIAL FOR INTEGRATING PRODUCT INFORMATIONPOTENTIAL FOR INTEGRATING PRODUCT INFORMATION PROVIDES SERVICE, VALUEPROVIDES SERVICE, VALUE*

19 4.18 © 2002 by Prentice Hall ELECTRONIC COMMERCE PAYMENT SYSTEMS

20 4.19 © 2002 by Prentice Hall INTRANETS AND ELECTRONIC BUSINESS BENEFITSBENEFITS FUNCTIONAL APPLICATIONSFUNCTIONAL APPLICATIONS SUPPLY CHAIN MANAGEMENTSUPPLY CHAIN MANAGEMENT*

21 4.20 © 2002 by Prentice Hall BENEFITS OF INTRANETS: CONNECTIVITYCONNECTIVITY CAN BE TIED TO LEGACY SYSTEM & TRANSACTION PROCESSINGCAN BE TIED TO LEGACY SYSTEM & TRANSACTION PROCESSING INTERACTIVE APPLICATIONS WITH TEXT, AUDIO, VIDEOINTERACTIVE APPLICATIONS WITH TEXT, AUDIO, VIDEO SCALABLE TO LARGER OR SMALLER SYSTEMS AS REQUIREDSCALABLE TO LARGER OR SMALLER SYSTEMS AS REQUIRED*

22 4.21 © 2002 by Prentice Hall BENEFITS OF INTRANETS: EASY TO USE BROWSER INTERFACEEASY TO USE BROWSER INTERFACE LOW START-UP COSTSLOW START-UP COSTS RICH, RESPONSIVE INFORMATION ENVIRONMENTRICH, RESPONSIVE INFORMATION ENVIRONMENT REDUCED INFORMATION DISTRIBUTION COSTSREDUCED INFORMATION DISTRIBUTION COSTS*

23 4.22 © 2002 by Prentice Hall FUNCTIONAL APPLICATIONS: FINANCE & ACCOUNTINGFINANCE & ACCOUNTING HUMAN RESOURCESHUMAN RESOURCES SALES & MARKETINGSALES & MARKETING MANUFACTURING & PRODUCTIONMANUFACTURING & PRODUCTION*

24 4.23 © 2002 by Prentice Hall FINANCE & ACCOUNTING: GENERAL LEDGER REPORTINGGENERAL LEDGER REPORTING PROJECT COSTINGPROJECT COSTING ANNUAL REPORTSANNUAL REPORTS BUDGETINGBUDGETING*

25 4.24 © 2002 by Prentice Hall HUMAN RESOURCES: CORPORATE POLICIESCORPORATE POLICIES EMPLOYEE SAVINGS PLANSEMPLOYEE SAVINGS PLANS BENEFITS ENROLLMENTBENEFITS ENROLLMENT ON-LINE TRAININGON-LINE TRAINING JOB POSTINGJOB POSTING*

26 4.25 © 2002 by Prentice Hall SALES & MARKETING: COMPETITOR ANALYSISCOMPETITOR ANALYSIS PRICE UPDATESPRICE UPDATES PROMOTIONAL CAMPAIGNSPROMOTIONAL CAMPAIGNS SALES PRESENTATIONSSALES PRESENTATIONS SALES CONTRACTSSALES CONTRACTS*

27 4.26 © 2002 by Prentice Hall MANUFACTURING & PRODUCTION : QUALITY MEASUREMENTSQUALITY MEASUREMENTS MAINTENANCE SCHEDULESMAINTENANCE SCHEDULES DESIGN SPECIFICATIONSDESIGN SPECIFICATIONS MACHINE OUTPUTMACHINE OUTPUT ORDER TRACKINGORDER TRACKING*

28 4.27 © 2002 by Prentice Hall SHIPPINGINVENTORY PLANNING & FORECASTING ORDER PROCESSING PRODUCTION PROCUREMENT ACCOUNTING SUPPLIERSCUSTOMERS LOGISTICS SERVICES DISTRIBUTORS INTRANET INTRANET SUPPLY-CHAIN MANAGEMENT

29 4.28 © 2002 by Prentice Hall CHALLENGES & OPPORTUNITIES UNPROVEN BUSINESS MODELSUNPROVEN BUSINESS MODELS BUSINESS PROCESS CHANGE REQUIREMENTSBUSINESS PROCESS CHANGE REQUIREMENTS CHANNEL CONFLICTSCHANNEL CONFLICTS LEGAL ISSUESLEGAL ISSUES SECURITY & PRIVACYSECURITY & PRIVACY*

30 4.29 © 2002 by Prentice Hall c h a p t e r 4 4 THE DIGITAL FIRM: ELECTRONIC COMMERCE & ELECTRONIC COMMERCE & ELECTRONIC BUSINESS

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