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CHAPTER 3: E-BUSINESS TECHNOLOGY AND INFRASTRUCTURE - Coggle Diagram
CHAPTER 3: E-BUSINESS TECHNOLOGY AND INFRASTRUCTURE
3.1 Introduction
The digital economy rests upon an invisible but critical foundation —
technology infrastructure
.
Without networks, servers, databases, and software, there would be no e-commerce, social media, or digital supply chains. Chapter 3 explores this technological “spine” that enables e-business.
The
IS3167 Subject Guide
emphasises that while managers need not be computer engineers, they must understand what each technological component does and how it contributes to business value. Similarly,
Chaffey (2015)
frames this as “managing digital business infrastructure” — the combination of hardware, software, data, and communication systems that enable organisations to deliver digital products and services.
In other words, managers are not expected to build the network, but to understand:
What technologies underpin e-business;
How these technologies interconnect to create value;
How digital infrastructure choices affect business agility, scalability, and cost.
E-business infrastructure has evolved through major technological waves:
Internet and Web 1.0: Static information sharing.
Web 2.0: Interactive, user-generated platforms.
Cloud computing: Virtualised resources and software as a service.
Mobile and IoT: Always-connected devices extending business processes beyond desktops.
Each stage redefined how businesses operate, collaborate, and compete.
3.2 Networks and the Internet
a. The Internet
The
Internet
is the global system of interconnected computer networks that allows digital communication. It is built on the
TCP/IP protocol
suite, which ensures reliable data transfer across heterogeneous systems.
It underpins all online services — from websites and email to video conferencing, cloud storage, and mobile apps.
Key business uses include:
Commerce
: Online sales, banking, and e-procurement.
Collaboration
: Shared documents and project management (e.g., Google Workspace, Microsoft 365).
Communication
: Email, video conferencing, and collaborative tools.
b. Intranets and Extranets
Intranets
are private, secure networks for internal use — improving communication, HR management, and productivity.
Example: IBM’s
“W3” intranet integrates corporate news, employee resources, and analytics dashboards for staff worldwide.
Extranets
connect an organisation with its external partners — suppliers, distributors, or customers.
Example: Dell’s
supplier portal enables real-time coordination with component providers, improving supply chain efficiency.
Chaffey (2015) argues that managing
internal digital communication
through intranets/extranets is vital for productivity and integration — especially in geographically dispersed enterprises.
3.3 Networking Standards
Standards ensure that diverse systems can communicate. The most important include:
HTTP/HTTPS
:
Function:
Web data transfer and security
Business Relevance
: Supports web browsing and secure transactions.
TCP/IP:
function
: Fundamental Internet communication protocols
Business Relevance
: Enables universal connectivity across networks.
FTP / SFTP:
Functions:
File transfer protocols
Business Relevance
: Used in e-commerce for data exchange and system integration.
XML / JSON:
Function:
Data formatting standards
Business Relevance
: Allow different systems (e.g., CRM, ERP) to exchange structured data.
SOAP / REST APIs:
function
: Application integration protocols
Business Relevance
: Enable modular, service-oriented applications.
Adhering to these standards allows businesses to integrate internal systems with suppliers, partners, and customers — a foundation of
digital ecosystems
.
3.4 The World Wide Web
The
Web
sits atop the Internet as a medium for sharing and interacting with information.
It relies on three core technologies:
CSS (Cascading Style Sheets)
: Controls layout and style.
JavaScript
: Adds interactivity and dynamic content.
HTML (HyperText Markup Language)
: Defines structure and content.
Modern e-businesses use
content management systems (CMS)
such as WordPress, Magento, or Shopify to manage large volumes of web data and transactions efficiently.
The web’s importance lies not merely in publishing but in
connecting business processes to users
— enabling digital marketing, customer service, and e-commerce transactions.
3.5 Web 2.0: The Social and Participatory Web
The move to
Web 2.0
revolutionised e-business by introducing interactivity and user-generated content (UGC).
It transformed websites into platforms where users could share, comment, and collaborate.
Characteristics of Web 2.0:
Social interaction:
Users connect, review, and influence purchasing decisions.
Participation
: Blogs, wikis, and forums support co-creation.
Network effects:
Value increases with user participation (e.g., Facebook, YouTube, TripAdvisor).
Personalisation:
Adaptive interfaces and recommendations based on user data.
Business implications:
Companies must manage
two-way communication
with customers.
Social data becomes a key marketing resource.
Brand reputation depends on online community engagement.
Chaffey (2015) notes that
social media marketing and peer-to-peer content
have made customers part of the business value chain — influencing product development, promotion, and support.
3.6 Peer-to-Peer (P2P) Networks
P2P networks distribute processing power and data among users, rather than relying on a central server.
Applications:
File sharing
: Napster, BitTorrent.
Distributed computing
:
SETI@home
, blockchain.
Decentralised finance (DeFi):
Peer-based cryptocurrency systems.
Managerial issues:
Legal
: Managing copyright and data security.
Technical
: Controlling data consistency.
Strategic
: Leveraging decentralised networks for innovation (e.g., blockchain-based smart contracts).
Example:
Bitcoin’s blockchain illustrates how decentralised architectures can enhance trust and transparency — enabling secure transactions without intermediaries.
3.7 Cloud Computing
Cloud computing represents the biggest shift in e-business infrastructure in two decades.
The on-demand delivery of IT resources and applications over the Internet on a pay-per-use basis.
Service Models:
Model: IaaS
Infrastructure as a Service – virtual servers and storage example: Amazon Web Services (AWS) EC2
PaaS
Platform as a Service – tools for application development example: Google App Engine
SaaS
Software as a Service – fully managed applications example: Salesforce, Office 365
Benefits:
Scalability and flexibility
Cost efficiency (no capital investment)
Rapid deployment and innovation
Global accessibility
Risks:
Vendor lock-in
Data security and privacy concerns
Compliance with jurisdictional regulations
Chaffey’s Analysis:
Cloud computing and service-oriented architecture (SOA) allow firms to integrate multiple services into modular, adaptive systems. This modularity is key to digital agility — the ability to rapidly innovate and scale.