E-Business 2007-2008 Professor Linda A Macaulay linda.macaulay@manchester.ac.uk

E-Business2007-2008

•Professor Linda A Macaulay

•linda.macaulay@manchester.ac.uk

2Manchester Business School

Professor L.A. Macaulay

Overview

• Module Objectives• Introductions & Questions• PART 1: definitions, models &

infrastructure• PART 2: environmental factors• Group discussion• Preparation for next week

3Manchester Business School

Professor L.A. Macaulay

Module objectives• To investigate state of the art in e-

Business from both a theoretical and practical standpoint

• To examine a range of e-Business models focussing on how they interact with each other in supporting the various business activities

• To examine e-Business solutions and how they affect Business to Business and Business to Consumer applications

• To examine the emerging patterns for e-Business

4Manchester Business School

Professor L.A. Macaulay

Today’s objectives

• To get to know each other!• To introduce some key

background factors associated with e-business– Models– Infrastructure– Environment– SMEs– Business issues

• To explain module structure

5Manchester Business School

Professor L.A. Macaulay

Introductions

– To each other– Name, where from, which

programme you are on, why you are interested in e-business

– Any questions so far?

6Manchester Business School

Professor L.A. Macaulay

PART 1: definitions, models and infrastructure

The definition of Electronic Commerce from the European Union web site, 1997, (http://europa.eu.int):Electronic Commerce is a general concept covering any form of business transaction of information exchange executed using information communication technology,

A definition of e-business by IBM (www.ibm.com/e-business)E-business is the transformation of key business processes through the use of Internet technologies

E-commerce can be viewed as a subset of e-business

7Manchester Business School

Professor L.A. Macaulay

E-business: Interdisciplinary with many options

• Interdisciplinary NatureMarketing Accounting & AuditingComputer Sciences ManagementConsumer behaviour & psychology MISFinance Business Law & EthicsEconomics Others

• Options for trading between business and consumer– B2C – retail to consumers– B2B – interorganisational– C2C – consumer interactions e.g. auctions– C2B – customer makes offers to business e.g. Priceline

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Professor L.A. Macaulay

“Accept” the Promise

ElectronicServicescape

“Keep” the Promise

Order Fulfillment

“Make” the Promise

Advertising Marketing

Sales

A conceptual framework positioning e-commerce within a ‘promise model’

( Wanninger, Bled e-Commerce conference,1998)

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Professor L.A. Macaulay

Definition of Target Market,

Product, Channels

Communication to the

Customer,Creative

Media Mix

Accept the Promise

Make the Promise

Returns &

Customer Service

Production, Inventory

Management

Receive Order,

Assemble, Pack,

DeliverProcurement,

SuppliersAccounting, Invoicing, Payables,

Receivables

Payment Processes

Keep the Promise

Information Systems, Analytical

Tools, Customer & Operations Databases

Electronic Servicescape

The ‘promise model’ extended

Customer

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Professor L.A. Macaulay

)Innovation and Emerging Business Models, Paul Timmers (see paper enclosed)

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Professor L.A. Macaulay

E-business models in detail

• E-shop – marketing of a company or shopPromotion, cost reduction, additional outlet

• E-procurement – electronic tendering and procurement of goods and services

• E-auction – can be C2C e.g. www.ebay.com or B2C e.g. www.qxl.comElectronic bidding, no need for prior movement of goods or

participants• E-mall – a collection of e-shops

Visits to “neighbouring shops”, aggregation of internet services(www.barclays-square.com)

• 3rd party marketplaceCommon marketing front-end and transactions to support

multiple businesses(e.g. http://www.cendant.com/ctg/cgi-bin/Corp/)

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Professor L.A. Macaulay

Class question

• What new models have emerged in the past five years…

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Professor L.A. Macaulay

New business models..last year’s students…

• E-learning• E-government• Search engines• Lots of business models integrated within one website e.g. Amazon, eBay• E-shop has changed: services now available for individuals and small

business within eBay• ASP provide wider range of services• E-shop now more customization, e-malls obsolete would use search

instead• E-auction more ‘user friendly’ more accessible• Groupware tools extend a range of business models• Virtual communities: now more functional and can combine with business

– Issues: security of personal data– Who are you talking to online?– Could reduce social interaction

• Product customization (e.g. design own shoes)• E-Entertainment• M-commerce• More online advertising for websites, growth of trust services, digital

certificates leading to popularity of e-banking• Change in technology e.g.data mining, profiling, need to make things

more difficult for hackers• Security now a major issue• Improved banking• Efficiency

14Manchester Business School

Professor L.A. Macaulay

Further e-business models• Virtual communities can be B2C communities e.g.

www.xoom.com or B2B e.g. www.vertical.net• Collaboration platforms – enable collaboration between

business or individuals e.g. www.egroups.com• Value chain integrators – offer a range of services

across the value-chain• Value-chain service providers – specialise in providing

functions for a specific part of a value chain e.g. logistics company www.ups.com

• Information Brokerage – providing information e.g. to assist in buying decisions or for business operations

• Trust services – authenticate the quality of service provided by companies trading on the web e.g. www.which.net/webtraderor www. Truste.org

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Professor L.A. Macaulay

Internet infrastructurecomponents

Physical and network infrastructure components of the Internet (Chaffey)

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Professor L.A. Macaulay

Information exchange between a web browser and web server

Information exchange between a web browser and web server (Chaffey)

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Professor L.A. Macaulay

E-business infrastructure

A five-layer model of e-business infrastructure (Chaffey)

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Professor L.A. Macaulay

Activity

• What other factors/issues affect e-business beyond technology and management?

• Talk in pairs and identify two or three factors/issues

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Professor L.A. Macaulay

PART2: Environmental Factors

• Environmental factors affecting e-business– Social

• Access to and use of e-business• Ethical issues

– Legal– Economic/Political– Technological

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Professor L.A. Macaulay

Social: Ethical issues and data protection

• Ethical Trading• UK Data Protection Act

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Professor L.A. Macaulay

FairAdequate

TransferAccuracy

Rights Specific

RetentionSecurity

FARSTARS

FARSTARS

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Professor L.A. Macaulay

The 8 Principles are informed by the Act….• Fair and honest account of why you want

the data• Adequate collection: obtain enough and no

more• Rights to know what is held about them • Specific purpose for which it was collected• Transfer of personal data is regulated• Accuracy must be maintained at all times• Retention must be justified on the basis of

need• Security of systems for processing and

secure procedures for using

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Professor L.A. Macaulay

Social: Information flows for data protection

Information flows that need to be understood for compliance with

data protection legislation (Chaffey)

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Professor L.A. Macaulay

Legal: Sparrow’s eight areas of concern for e-business

1. Marketing your e-commerce business 2. Forming an electronic contract 3. Making and accepting payment 4. Authenticating contracts concluded over the

Internet5. E-mail risks 6. Protecting intellectual property 7. Advertising on the Internet 8. Data protection

25Manchester Business School

Professor L.A. Macaulay

Economic / Political

• Ensuring companies competitive– Funding for education and technology:– Promoting new technology e.g. goals for

broadband provision within countries

• Achieving government efficiencies– E-government – all UK services online– Singapore ‘Intelligent Island’

• Taxation regimes– Legislation for offshore trading

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Professor L.A. Macaulay

E-economy framework

A framework describing the e-economy (Chaffey)

Source: Booz Allen Hamilton (2002). Copyright © Crown copyright 2002, Crown copyright material is reproduced with the permission of the Controller of HMSO.

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Professor L.A. Macaulay

Leaders and laggards in e-commerce

Leaders and laggards in e-commerce (Chaffey) (economic/political)

Source: © 2003 Reproduced by permission of the Economist Intelligence Unit. E-readiness Rankings 2003

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Professor L.A. Macaulay

Technological issues

• Rate of change– Which new technologies should we

adopt?• Monitoring for new techniques• Evaluation – are we early adopter?• Re-skilling and training

• Are our systems secure?

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Professor L.A. Macaulay

Group Discussion

Discuss your experiences as a user and as a developer of e-business systems

What are the key problems facing e-business?

• Plan– 5 mins introductions– 30-40 mins discussion– 15 mins feedback

30Manchester Business School

Professor L.A. Macaulay

Key problems 1

• Security• User friendly interface• Limited bank services• Lack of international credit cards• Cash oriented society• Product oriented not services• English language oriented website• International laws for tansactions• Laws governing activity e.g.

gambling• Lack of face to face contact/trust

31Manchester Business School

Professor L.A. Macaulay

Key issues 2

• Non e-literate users• Research online but buying locally• Cost barrier to accessing the internet• Price oriented competition• Delivery is slow• Accessibility for blind or other

disadvantaged• Difficult for small business without a

brand name

32Manchester Business School

Professor L.A. Macaulay

Key issues 3

• Delivery and after sales services• Data protection• Fake websites and security• Usability• Need a business platform that can

run on every platform• Compatibility• Just in time supply chain• How to move your existing business

to and e-business

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Professor L.A. Macaulay

Summary

• Reading for next week• Timmers paper on e-Business

Models• Did we meet our objectives?