E-Business_Fundament

E-Business Fundamentals

Professor L. KerschbergGeorge Mason University

INFS 770

© Larry Kerschberg 2

Outline E-Business definition From the physical to the virtual Interfacing the physical and virtual Knowledge management and e-business Types of E-business Best-of-breed companies Customer’s Requirements for E-

Business


E-Business Quote for Lou Gerstner, IBM’s CEO:

“E-Business is all about cycle time, speed, globalization, enhanced productivity, reaching new customers, and sharing knowledge across institutions for competitive advantage.”


From Physical to Virtual Trend from atoms to bits. Trend is toward strategic relationships. Create an e-space in which to conduct e-

business. Finding the information Selecting the product Negotiating the purchase Effecting the transaction Following up on the transaction, including

tracking, returns, etc. E-Business versus E-commerce!?


Physical to Virtual Interfacing Old-economy companies are extending their

reach by offering on-line services (catalogs, commodities, and e-services), Office Depot (Office supplies; #2 web retailer,

after Amazon) LL Bean (Catalog sales; Dogs are in at LL Bean) Barnes and Noble (Booksellers) Charles Schwab (on-line brokerage) Boeing Parts Network (24/7 parts for airlines)

Outreach to customers. Commodities sell well in e-space.


Virtual Players Consumer-to-Consumer (C2C)

Ebay (www.ebay.com) - (facilitator) electronic auctions with consumers handling transaction and shipping.

Napster (www.napster.com) - (facilitator) peer-to-peer music exchange; courts not happy.

Groove Networks (www.groove.com) (facilitator) secure peer-to-peer collaboration services. Founded by Ray Ozzie, the creator of Lotus Notes.


Virtual Players Business-to-Consumer (B2C)

Yahoo! (www.yahoo.com) - (aggregator) leading portal and most visited e-space!

E-Trade (www.etrade.com) On-line investing and banking; moving to click-and-mortar outposts.

McAfee (www.mcafee.com) Software subscription services for virus scanning.

Software purchase, delivery and update, example is: Copernic (www.copernic.com)

Digital Content Services; example is: Sony Music (www.sony.com)


Knowledge and E-business Customer behavior and preferences -> data

mining, customization. Domain knowledge to sell knowledge-rich

value-added services, e.g. Buckman Laboratories.

Process knowledge -> improvement and evolution; best practices, business rules, BPR via digitization.

Knowledge Sharing via intranets, extranets and e-marketplaces -> shorter development times, smaller inventories, rapid delivery.


Eight Categories of E-Business

E-Communities E-Service E-Process E-Infrastructure E-Procurement E-Content E-Analysis E-Markets


E-Communities Connects personnel, customers and partners. Discussion threads allow for knowledge

sharing. Provides a resource for e-businesses to

leverage on-line discussions and interaction to maximize innovation and responsiveness.

Company intranets and extranets.


E-Service An e-business must manage interactions with

employees, customers, and partners. E-service involves Customer Relationship

Management (CRM). E-business can run in 24/7 mode providing

up-to-the-minute information and service. Performance and scalability issues are

important for service delivery.


E-Process Digitization entails new and improved business

processes, not just a web home page. Enterprise workflow and information flows

must conform to the new business processes. Tools are needed for specifying, building,

configuring, managing, tracking of complex transactions within the corporation and across the B2B e-space.

Business rules and workflow specification languages play a role in e-business.


E-Infrastructure E-business infrastructure is important to the

smooth functioning of a site. Architectures are needed for e-business

sites. Need tools to build and manage e-business

sites. Scalability, reliability and responsiveness are

of utmost importance. Network, software, security, hardware

and personnel are important factors.


E-Procurement B2B is more than simply Internet-based EDI. Companies can realize cost-savings by

partnering in via purchasing exchanges. Companies such as CommerceOne and Ariba

excel in creating these exchanges. B2B allows companies to integrate their

information systems and business processes. webMethods, Oracle and i2 compete and

cooperate in this arena.


E-Content E-business relies on content management to

tailor the information visitors are presented. Dynamic personalization makes the user

experience more timely and productive. Portals, both intranet and extranet, can save

money and improve relationships. IBM, Schwab and Ford save $$$ a year by having

employees use their intranets for employee-to-enterprise business tasks.

Suppliers can see a client’s production schedule and deliver products “just-in-time”.


E-Analysis We need tools to analyze consumer buying

patterns, behaviors at web sites, and preferences.

We need to understand the issues involved in the entire value chain and where savings can be maximized.

Companies such as DoubleClick, Microstrategy, and Accrue are active in this sector. See the article on Chief Privacy Officer in NYT.


E-Markets Vertical e-marketplaces bring together

customers and suppliers who share information, enter discussions, and auction excess merchandise. VerticalNet is a leader in this arena. In Autos we have Covisint, powered by Mercator, In Steel, e-Steel, powered by, including

BEA’s WebLogic and webMethods. In Plastics, there are many, including PlasticsNet;

visit their web site.


Types of E-business (1) Aggregators (Yahoo, Alta-Vista,

Excite) Facilitators and brokers (Amazon,

Ebay, Barnes and Noble, Groove, Napster)

Marketplaces (Covisint, E-steel, …) B2B Integrators (webMethods, i2,

…)


Types of E-Business (2) E-Business Infrastructure

Advertising (DoubleClick) Business Intelligence (Microstrategy) Customer Relationship Management

(Broadvision, Seibel, …) Database Providers

Oracle, Informix, Sybase, IBM, … Consulting Services

Accenture, KPMG, NobleStar, …


Best-of-Breed This space needs to be filled in

with Case Studies.


Customer E-BusinessRequirementsAdapted from Patricia Sebold’s new book. Open, equal access – Internet allows

everyone to have access to the same information.

Real-Time information – up-to-the-minute quotes on stocks, airline tickets, inventory.

Specialist information – knowledgeable advice provided by specialists; interpreted and filtered information.

Convenient access – Anytime, anywhere access to information and services.


Customer’s Requirements (2) Information portability – carrying personal

information for shopping and transactions so as to be able to switch suppliers easily.

Process transparency – ability to verify status of one’s processes related to a transaction. Crucial for worldwide manufacturing for risk reduction and to optimize availability.

Logistics transparency – Customer or supplier needs to know the status of orders in the fulfillment process.


Customer’s Requirements (3) Pricing transparency – companies will

adopt global pricing, while customers can easily compare pricing and availability in a matter of minutes.

Fair, global pricing – customers will cross borders to obtain best prices.

Ability to set pricing – aggregations of small businesses to obtain better prices, Priceline.com name-your-own-price methods, auctions.


Customer Requirements (4) Choice of distribution channels – purchase

through traditional retail outlets and directly via the Internet. Choice will be important. Examples include Apple, HP, and Dell

Control over their information – customers will want to have increasing control over how their information is collected and processed for data mining purposes. Sites now allow users to opt out of being monitored.

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E-Business_Fundament