The digital firm

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The digital firm

  1. 1. 4 THE DIGITAL FIRM: ELECTRONIC COMMERCE & ELECTRONIC BUSINESS c h a p t e r
  2. 2. LEARNING OBJECTIVES <ul><li>EXPLAIN HOW INTERNET TRANSFORMS BUSINESS </li></ul><ul><li>COMPARE CATEGORIES OF ELECTRONIC COMMERCE </li></ul><ul><li>EVALUATE PRINCIPAL ELECTRONIC PAYMENT SYSTEMS </li></ul><ul><li>* </li></ul>
  3. 3. LEARNING OBJECTIVES <ul><li>DEMONSTRATE HOW INTERNET TECHNOLOGY SUPPORTS ELECTRONIC BUSINESS, SUPPLY CHAIN MANAGEMENT </li></ul><ul><li>EXAMINE CHALLENGES OF INTERNET TO BUSINESS & SOCIETY </li></ul><ul><li>* </li></ul>
  4. 4. MANAGEMENT CHALLENGES <ul><li>EMERGING DIGITAL FIRM </li></ul><ul><li>ELECTRONIC COMMERCE </li></ul><ul><li>ELECTRONIC BUSINESS </li></ul><ul><li>CHALLENGES & OPPORTUNITIES </li></ul><ul><li>* </li></ul>
  5. 5. MANAGEMENT CHALLENGES <ul><li>1. ELECTRONIC COMMERCE & ELECTRONIC BUSINESS REQUIRE NEW MIND SET </li></ul><ul><li>2. FINDING SUCCESSFUL INTERNET BUSINESS MODEL </li></ul><ul><li>* </li></ul>
  6. 6. INTERNET TECHNOLOGY & THE DIGITAL FIRM <ul><li>INFORMATION TECHNOLOGY INFRASTRUCTURE: Information flows seamlessly throughout </li></ul><ul><li>DIRECT COMMUNICATION BETWEEN TRADING PARTNERS: DISINTERMEDIATION removes intermediate layers streamlines process </li></ul><ul><li>* </li></ul>
  7. 7. INTERNET TECHNOLOGY & THE DIGITAL FIRM <ul><li>VENDORS CAN PROVIDE INFORMATION 24 HOURS A DAY </li></ul><ul><li>CAN EXTEND DISTRIBUTION CHANNELS </li></ul><ul><li>CAN REDUCE TRANSACTION COSTS </li></ul><ul><li>* </li></ul>
  8. 8. INTERNET TECHNOLOGY & THE DIGITAL FIRM <ul><li>REDUCES INFORMATION ASYMMETRY : Asymmetry exists when one party has more information than other </li></ul><ul><li>INCREASES RICHNESS : Depth & detail of information </li></ul><ul><li>INCREASES REACH : Number of people contacted </li></ul><ul><li>* </li></ul>
  9. 9. INTERNET BUSINESS MODELS <ul><li>VIRTUAL STOREFRONT: Sells goods, services on-line </li></ul><ul><li>MARKETPLACE CONCENTRATOR: Concentrates information from several providers </li></ul><ul><li>ON-LINE EXCHANGE: Bid-ask system, multiple buyers, sellers </li></ul><ul><li>* </li></ul>
  10. 10. <ul><li>INFORMATION BROKER: Provide info on products, pricing, etc. </li></ul><ul><li>TRANSACTION BROKER: Buyers view rates, terms from various sources </li></ul><ul><li>AUCTION: Electronic clearinghouse products, prices, change in response to demand </li></ul><ul><li>* </li></ul>INTERNET BUSINESS MODELS
  11. 11. <ul><li>REVERSE AUCTION: Buyer sets price, submits to multiple sellers </li></ul><ul><li>AGGREGATOR: Group pools orders for volume discount </li></ul><ul><li>DIGITAL PRODUCT DELIVERY: Sell, download software, other digital products </li></ul><ul><li>* </li></ul>INTERNET BUSINESS MODELS
  12. 12. <ul><li>CONTENT PROVIDER: Creates revenue through providing client for a fee, and advertising </li></ul><ul><li>ON-LINE SERVICE PROVIDER: Provides service, support for hardware, software products </li></ul><ul><li>VIRTUAL COMMUNITY: Chat room, online meeting place </li></ul><ul><li>* </li></ul>INTERNET BUSINESS MODELS
  13. 13. <ul><li>PORTAL: Initial point of entry to Web, specialized content, services </li></ul><ul><li>SYNDICATOR: Aggregate information from several sources sold to other companies </li></ul><ul><li>* </li></ul>INTERNET BUSINESS MODELS
  14. 14. ELECTRONIC COMMERCE <ul><li>BUSINESS-TO-CONSUMER (B2C) </li></ul><ul><li>BUSINESS-TO-BUSINESS (B2B) </li></ul><ul><li>CONSUMER-TO-CONSUMER (C2C): Individuals use Web for private sales or exchange </li></ul><ul><li>* </li></ul>
  15. 15. BUSINESS-TO-CONSUMER <ul><li>WEB SITES: Provide information on products, services, prices, orders </li></ul><ul><li>CUSTOMER-CENTERED RETAILING: Closer, yet more cost-effective relationship with customers </li></ul><ul><li>INFORMATION BROKERS: Comparison shops to customer’s requirements, reintermediation </li></ul><ul><li>* </li></ul>
  16. 16. BUSINESS-TO-BUSINESS ELECTRONIC COMMERCE <ul><li>AUTOMATION OF PURCHASE, SALE TRANSACTIONS FROM BUSINESS TO BUSINESS </li></ul><ul><li>PROVIDES ALTERNATIVE SOURCES </li></ul><ul><li>ELECTRONIC HUBS: Online marketplaces, point-to-point connections, integrated information </li></ul><ul><li>* </li></ul>
  17. 17. BUSINESS-TO-BUSINESS ELECTRONIC COMMERCE <ul><li>EXCHANGES: Commercial on-line market, many buyers, sellers </li></ul><ul><li>POTENTIAL FOR INTEGRATING PRODUCT INFORMATION </li></ul><ul><li>PROVIDES SERVICE, VALUE </li></ul><ul><li>* </li></ul>
  18. 18. ELECTRONIC COMMERCE PAYMENT SYSTEMS
  19. 19. INTRANETS AND ELECTRONIC BUSINESS <ul><li>BENEFITS </li></ul><ul><li>FUNCTIONAL APPLICATIONS </li></ul><ul><li>SUPPLY CHAIN MANAGEMENT </li></ul><ul><li>* </li></ul>
  20. 20. BENEFITS OF INTRANETS: <ul><li>CONNECTIVITY </li></ul><ul><li>CAN BE TIED TO LEGACY SYSTEM & TRANSACTION PROCESSING </li></ul><ul><li>INTERACTIVE APPLICATIONS WITH TEXT, AUDIO, VIDEO </li></ul><ul><li>SCALABLE TO LARGER OR SMALLER SYSTEMS AS REQUIRED </li></ul><ul><li>* </li></ul>
  21. 21. BENEFITS OF INTRANETS: <ul><li>EASY TO USE BROWSER INTERFACE </li></ul><ul><li>LOW START-UP COSTS </li></ul><ul><li>RICH, RESPONSIVE INFORMATION ENVIRONMENT </li></ul><ul><li>REDUCED INFORMATION DISTRIBUTION COSTS </li></ul><ul><li>* </li></ul>
  22. 22. FUNCTIONAL APPLICATIONS: <ul><li>FINANCE & ACCOUNTING </li></ul><ul><li>HUMAN RESOURCES </li></ul><ul><li>SALES & MARKETING </li></ul><ul><li>MANUFACTURING & PRODUCTION </li></ul><ul><li>* </li></ul>
  23. 23. FINANCE & ACCOUNTING: <ul><li>GENERAL LEDGER REPORTING </li></ul><ul><li>PROJECT COSTING </li></ul><ul><li>ANNUAL REPORTS </li></ul><ul><li>BUDGETING </li></ul><ul><li>* </li></ul>
  24. 24. HUMAN RESOURCES: <ul><li>CORPORATE POLICIES </li></ul><ul><li>EMPLOYEE SAVINGS PLANS </li></ul><ul><li>BENEFITS ENROLLMENT </li></ul><ul><li>ON-LINE TRAINING </li></ul><ul><li>JOB POSTING </li></ul><ul><li>* </li></ul>
  25. 25. SALES & MARKETING: <ul><li>COMPETITOR ANALYSIS </li></ul><ul><li>PRICE UPDATES </li></ul><ul><li>PROMOTIONAL CAMPAIGNS </li></ul><ul><li>SALES PRESENTATIONS </li></ul><ul><li>SALES CONTRACTS </li></ul><ul><li>* </li></ul>
  26. 26. MANUFACTURING & PRODUCTION : <ul><li>QUALITY MEASUREMENTS </li></ul><ul><li>MAINTENANCE SCHEDULES </li></ul><ul><li>DESIGN SPECIFICATIONS </li></ul><ul><li>MACHINE OUTPUT </li></ul><ul><li>ORDER TRACKING </li></ul><ul><li>* </li></ul>
  27. 27. SUPPLY-CHAIN MANAGEMENT SHIPPING INVENTORY PLANNING & FORECASTING ORDER PROCESSING PRODUCTION PROCUREMENT ACCOUNTING SUPPLIERS CUSTOMERS LOGISTICS SERVICES DISTRIBUTORS INTRANET INTRANET
  28. 28. CHALLENGES & OPPORTUNITIES <ul><li>UNPROVEN BUSINESS MODELS </li></ul><ul><li>BUSINESS PROCESS CHANGE REQUIREMENTS </li></ul><ul><li>CHANNEL CONFLICTS </li></ul><ul><li>LEGAL ISSUES </li></ul><ul><li>SECURITY & PRIVACY </li></ul><ul><li>* </li></ul>
  29. 29. 4 THE DIGITAL FIRM: ELECTRONIC COMMERCE & ELECTRONIC BUSINESS c h a p t e r

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