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Chapter 1: Evolution of E-business - Coggle Diagram
Chapter 1: Evolution of E-business
Definition
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E-commerce
: Includes many activities such as businesses trading with other businesses trading with other businesses and internal processes that companie use to support their buying, selling, hiring, planning and other activities.
E-business:
Some people use term e-business when they are talking about e-commerce.
Most people use term e-commerce and e-business interchangeably.
Categories of E-business
1. Business-to-Consumer (B2C)
Business sell products or services to individual consumers.
Example: Walmart.com sells merchandise to consumers thru its website
2. Business-to-Business
Business sell product or services to other businesses.
Example: Grainger.com sells industrial supplies to large and small businesses thru its website
3. Business Processes that Support Buying and Selling Activities
Business and other organisations maintain & use information to identify & evaluate customers, suppliers and employees.
Increasingly business share this information in carefully managed ways with their customers, suppliers, employees and business partners.
Example: Dell computer user secure internet connections to share current sales and sales forecast with supplier.
4. Consumer-to-Consumer (C2C)
Participants in an online marketplace can buy and sell goods to each other.
Example: Consumers and businesses trade with each other in the eBay
5. Business-to-Government (B2G)
Business sell goods or services to government agencies.
Example: CA.gov procurement site allows businesses to sell online to the other state of California.
The Growth of E-business
Opportunities and Concerns in E-Business
E-Business Opportunities
Increase purchasing opportunities
Easier to negotiate price and delivery terms
Wider range of choices available 24 hours a day.
Increase information exchange accuracy.
Immediate access to prospective purchase information
Efficiently obtains competitive bid information
Identifies new suppliers and business partners.
Four Concern in E-Business
The need for critical mass of potential buyers to be equipped with the technology necessary to buy online and be comfortable using that technology.
A level of predictability in costs & revenues related to the technologies used to undertake electronic commmerce.
Sufficient tools for both hardware and software. Technology & integration
The ability to overcome cultural and legal barriers that can prevent companies from doing business online efficiently.
E-Business Forces and Nature
Five Economic Forces
1. Transaction Costs
Transaction cost are total cost of all cost that a buyer incur as they gather information and negotiate a purchase-and-sale transaction.
2. Market and Hierarchies
When transaction cost are high, businesspeople would form organisation to replace market-negotiated transactions. It would be hierarchichal and would include strong supervision and worker-monitoring elements.
3. Using Electronic Commerce to Reduce Transaction Costs
Business and individuals can use electronic to reduce transaction costs by improving the flow of information and increasing the coordination of action.
4. Network Economic Structure
Companies coordinate their strategies, resources and skill sets by forming long-term stable relationship with other companies and individuals based on shared purposes.
5. Network Effects
As more people or organisation participate in a network, the value of the network to each participant increases.
Five International Nature Issues
Trust
For business to succeed on the Web, they must find ways to quickly generate the trust that traditional business takes years to develop
2. Culture
The combination of language and customs.
Companies with established brand can build online businesses more quickly and easily by conveying expectations about how the company will behave thru their brand.
3. Language
The only way to do business effectively in other cultures is to adapt to those cultures by translating the website into another language or regional dialect.
4. Government
Some countries have cultural environments whereby inhospitable to the online discussion that lead to government controls the limit electronic business development.
5. Infrastructure
An inadequacies that infrastructure that supports the internet throughout the world.
