1 A Report on E-BUSINESSPrepared by:Vikas Ranga (09113104), Department of Humanities and Social Sciences Indian Institute of Technology, RoorkeeTable of Contents Topic: Page no.
2 What is e-business?...........................................................................3 Application of e-business…………………………………………..3 Internal business systems: ………………………………………………....3 1. Customer relationship management…………………………………………...3 2. Enterprise resource planning…………………………………………………..3 3. Document management systems………………………………………………4 4. Human resources management………………………………………………..4 Enterprise communication and collaboration: …………………………...4 1. VoIP…………………………………………………………………………4 2. Content management system………………………………………………..6 3. E-mail……………………………………………………………………..…7 4. Voice mail………………………………………………………………..….9 5. Web conferencing……………………………………………………….….11 Electronic commerce………………………………………………….….13 1. Internet marketing…………………………………………………….…....16 2. Supply chain management…………………………………………………19 3. Online shop…………………………………………………………...……23 How e-business affect GDP of India?......................................................................28 Conclusion……………………………………………………….…28 References ………………………………………………………….29 What is e-business?Any business conducted using ―electronic media‖, most e-business conducted via web technology.
3"e-business", may be defined as the application of information and communication technologies (ICT) insupport of all the activities of business. ICT includes not only information technology but alsocommunication technology like telephony, broadcast media and all types of audio and video processingand transmission.Electronic business methods enable companies to link their internal and external data processing systemsmore efficiently and flexibly, to work more closely with suppliers and partners, and to better satisfy theneeds and expectations of their customers.E-commerce is a subset of an overall e-business strategy. E-commerce seeks to add revenue streams usingthe World Wide Web or the Internet to build and enhance relationships with clients and partners and toimprove efficiency using the Empty Vessel strategy. Often, e-commerce involves the application ofknowledge management systems. Application of e-business:- Internal business systems: 1. customer relationship management: Customer relationship management is a broadly recognized, widely-implemented strategy for managing a company‘s interactions with customers, clients and sales prospects. It involves using technology to organize, automate, and synchronize business processes—principally sales activities, but also those for marketing, customer service, and technical support. The overall goals are to find, attract, and win new clients, nurture and retain those the company already has, entice former clients back into the fold, and reduce the costs of marketing and client service. Customer relationship management denotes a company-wide business strategy embracing all client-facing departments and even beyond. When an implementation is effective, people, processes, and technology work together to increase profitability, and reduce operational costs. 2. enterprise resource planning: Enterprise Resource Planning (ERP) is an integrated computer-based system used to manage internal and external resources, including tangible assets, financial resources, materials, and human resources. Its purpose is to facilitate the flow of information between all business functions inside the boundaries of the organization and manage the connections to outside stakeholders. Built on a centralized database and normally utilizing a common computing platform, ERP systems consolidate all business operations into a uniform and enterprise-wide system environment. An ERP system can either reside on a centralized server or be distributed across modular hardware and software units that provide "services" and communicate on a local area network. The distributed design allows a business to assemble modules from different vendors without the need for the placement of multiple copies of complex and expensive computer systems in areas which will not use their full capacity. 3. document management systems:
4 A document management system (DMS) is a computer system or set of computer programs used to track and store electronic documents and/or images of paper documents. The term has some overlap with the concepts of content management systems. It is often viewed as a component of enterprise content management (ECM) systems and related to digital asset management, document imaging, workflow systems and records management systems. 4. human resources management: Human resource management (HRM) is the strategic and coherent approach to the management of an organizations most valued assets - the people working there who individually and collectively contribute to the achievement of the objectives of the business. The terms "human resource management" and "human resources" (HR) have largely replaced the term "personnel management" as a description of the processes involved in managing people in organizations. In simple words, HRM means employing people, developing their capacities, utilizing, maintaining and compensating their services in tune with the job and organizational requirement. Enterprise communication and collaboration 1) Voice over Internet Protocol: Definition: Voice over Internet Protocol (VoIP) is a general term for a family of organizations, communication protocols, and transmission technologies for delivery of voice communications and multimedia sessions over Internet Protocol (IP) networks, such as the Internet. Its synonymous are IP telephony, Internet telephony, voice over broadband, broadband telephony, and broadband phone. Internet telephony refers to communications services — voice, and/or voice-messaging applications — that are transported via the Internet, rather than the public switched telephone network . The steps involved in originating a VoIP telephone call are signaling and media channel setup, digitization of the analog voice signal, optionally compression, packetization, and transmission as Internet Protocol packets over a packet- switched network. On the receiving side similar steps reproduce the original voice stream. Examples of technologies used to implement Voice over IP include: A notable proprietary implementation is the Skype protocol, which is in-part based on the principles of peer-to-peer networking. How does VOIP work? VoIP systems employ session control protocols to control the set-up and tear-down of calls as well as audio codecs which encode speech allowing transmission over an IP network as digital audio via an audio stream. Codec use is varied between different implementations of VoIP (and often a range of codecs are used); some
5 implementations rely on narrowband and compressed speech, while others support high fidelity stereo codecs. Applications using VOIP: Traditional telephony applications, such as outbound call center applications and inbound IVR applications, normally can be run on VOIP. Why use VOIP? There are two major reasons to use VOIP I. Lower Cost: In general phone service via VOIP costs less than equivalent service from traditional sources. There are also some cost savings due to using a single network to carry voice and data. This is especially true when users have existing under-utilized network capacity that they can use for VOIP without any additional costs. In the most extreme case, users see VOIP phone calls (even international) as FREE. While there is a cost for their Internet service, using VOIP over this service may not involve any extra charges, so the users view the calls as free. There are a number of services that have jumped up to facilitate this type of "free" VOIP call. Examples are: Free World Dialup and Skype. II. Increased functionality: VOIP makes easy some things that are difficult to impossible with traditional phone networks. Incoming phone calls are automatically routed to your VOIP phone where ever you plug it into the network. Take your VOIP phone with you on a trip, and anywhere you connect it to the Internet, you can receive your incoming calls. Call center agents using VOIP phones can easily work from anywhere with a good Internet connection. 2) Enterprise content management (ECM) Definition: Enterprise content management (ECM) is a set of tools and methods that allow a corporation, agency or organization to obtain, organize, store and deliver information crucial to its operation.
6 According to the Association for Information and Image Management (AIIM), ECM can be broken down into five major components called capture, manage, store, preserve and deliver. The purpose of each component can be briefly defined as follows: Capture: Create, obtain and organize information. Manage: Process, modify and employ information. Store: Temporarily back up frequently changing information in the short term. Preserve: Back up infrequently changing information in the medium and long term. Deliver: Provide clients and end users with requested information. Content at work: Its not enough to "manage" content. Of course, the ability to access the correct version of a document or record is important, but companies must go further. Content must be managed so that it is used to achieve business goals. Central to this strategy are the tools and technologies of ECM, which manage the complete lifecycle of content, birth to death. To drive understanding of these tools, this article highlights a typical process for a piece of content as well as four primary areas in which content, and ECM, is fundamental to the success of your company: Compliance, Collaboration, Continuity, and Cost. While there are ECM technologies, more importantly, ECM is an ongoing and evolving strategy for maximizing how your content is to be used. Use the information below as a starting point to review a common content lifecycle. Map a current process to see where you may find overlap and room for improvement for the applications and strategies that your business is developing. The information below only hints at the complexity inherent in any process that deals with managing an organizations content. As always, you must match up the technology tools to address YOUR businesses needs. Technology can enable streamlined management of content, but the underlying strategy must come first. 3) Email: Definition: E-mail, is a method of exchanging digital messages across the Internet or other computer networks. Originally, email was transmitted directly from one user to another computer. This required both computers to be online at the same time. Todays email systems are based on a store-and-forward model. Email servers accept, forward, deliver and store messages. Users no longer need be online simultaneously and need only connect briefly, typically to an email server, for as long as it takes to send or receive messages. Message format: I. Message header: The message header should include at least the following fields:
7 From: The e-mail address, and optionally the name of the author(s). In many e-mail clients not changeable except through changing account settings. To: The e-mail address(es), and optionally name(s) of the messages recipient(s). Indicates primary recipients (multiple allowed), for secondary recipients see Cc: and Bcc: below. Subject: A brief summary of the topic of the message. Certain abbreviations are commonly used in the subject, including "RE:" and "FW:". Date: The local time and date when the message was written. Like the From: field, many email clients fill this in automatically when sending. The recipients client may then display the time in the format and time zone local to him/her. II. Message body: Most modern graphic e-mail clients allow the use of either plain text or HTML for the message body at the option of the user. HTML e-mail messages often include an automatically-generated plain text copy as well, for compatibility reasons. Advantages of HTML include the ability to include in-line links and images, set apart previous messages in block quotes, wrap naturally on any display, use emphasis such as underlines and italics, and change font styles. Disadvantages include the increased size of the email, privacy concerns about web bugs, abuse of HTML email as a vector for phishing attacks and the spread of malicious software. Some web based Mailing lists recommend that all posts be made in plain- text for all the above reasons, but also because they have a significant number of readers using text-based e-mail clients. Use: I. In society: There are numerous ways in which people have changed the way they communicate in the last 50 years; e-mail is certainly one of them. Traditionally, social interaction in the local community was the basis for communication – face to face. Yet, today face-to-face meetings are no longer the primary way to communicate as one can use a landline telephone, mobile phones, fax services, or any number of the computer mediated communications such as e-mail. Research has shown that people actively use e-mail to maintain core social networks, particularly when others live at a distance. However, contradictory to previous research, the results suggest that increases in Internet usage are associated with decreases in other modes of communication, with proficiency of Internet and e-mail use serving as a mediating factor in this relationship.
8 With the introduction of chat messengers and video conference, there are more ways to communicate. II. In business: E-mail was widely accepted by the business community as the first broad electronic communication medium and was the first ‗e-revolution‘ in business communication. E-mail is very simple to understand and like postal mail, e- mail solves two basic problems of communication: logistics and synchronization. The problem of logistics: Much of the business world relies upon communications between people who are not physically in the same building, area or even country; setting up and attending an in-person meeting, telephone call, or conference call can be inconvenient, time- consuming, and costly. E-mail provides a way to exchange information between two or more people with no set-up costs and that is generally far less expensive than physical meetings or phone calls. The problem of synchronization: With real time communication by meetings or phone calls, participants have to work on the same schedule, and each participant must spend the same amount of time in the meeting or call. E-mail allows asynchrony: each participant may control their schedule independently. LAN based email is also an emerging form of usage for business. It not only allows the business user to download mail when offline, it also provides the small business user to have multiple users e-mail IDs with just one e-mail connection. Most business workers today spend from one to two hours of their working day on e-mail: reading, ordering, sorting, ‗re-contextualizing‘ fragmented information, and writing e-mail. The use of e-mail is increasing due to increasing levels of globalization—labour division and outsourcing amongst other things. Disadvantages: E-mail can lead to some well-known problems: o Loss of context: which means that the context is lost forever; there is no way to get the text back. Information in context (as in a newspaper) is much easier and faster to understand than unedited and sometimes unrelated fragments of information. Communicating in context can only be achieved when both parties have a full understanding of the context and issue in question. o Information overload: E-mail is a push technology—the sender controls who receives the information. Convenient availability of mailing lists and use of "copy all" can lead to people receiving unwanted or irrelevant information of no use to them.
9 o Inconsistency: E-mail can duplicate information. This can be a problem when a large team is working on documents and information while not in constant contact with the other members of their team.Despite these disadvantages, e-mail has become the most widely used medium ofcommunication within the business world.4) Voicemail Definition: Voice mails are essentially digital recordings of outgoing and incoming voice messages that are managed either by an on-site or off-site system. Some users purchase systems that are operated and managed either by its own employees or on a contract basis with another company. Home- based users, such as home telephone and cell phone users, often use an off-site service, such as their phone service provider, for voice mail accounts. Others, however, purchase software that allows their PC to become an electronic message system. How Voice Mail Works: A call to any business or home used to mean one of three things -- an answer, a busy signal or endless, unanswered ringing. More modern voicemail systems work on the same principle, but some of the components may be shared with other systems, such as email systems. Voicemail systems contain several elements shown figure below:
10 A central processor (CPU) which runs the operating system and a program (software) that gives the system the look-and-feel of a voicemail system. This software includes thousands of pre-recorded prompts that "speak" to the users as they interact with the system; Disk controller and multiple disk drives for message storage; System disks which not only include the software above, but also contain a complete directory of all users with pertinent data about each (name, extension number, voicemail preferences, and pointers to each of the messages stored on the message disk that belong to them); Telephone interface system that enables many phone lines to be connected to it. Types of Voice Mail: There are several types of voice mail systems available. Such systems are designed to function differently based on whos using them and where, what equipment and software is used, and whos providing the phone message services. PC-based systems can be run using standard computers and servers. Such equipment can be modified to include voice board circuitry and additional plug- ins for phone lines or other equipment. These systems also include specialized software that integrates incoming and outgoing phone messages. Service-provided voice mail systems use hardware thats specially built by the company. Such proprietary systems can be customized from the ground up for the type of business it will serve. They can be more expensive than PC-based systems because of their custom nature. Residential voice mail, for instance, refers to voice-mail systems for the home. Generally these serve landlines and may include one or more "mailboxes" in which incoming callers can leave messages. In such systems, one mailbox typically acts as the main one, from which users can enter commands. Such systems can be based off-site with a service company or on-site with the residents home computer. Users generally record a greeting and dial a special number and enter a password to retrieve messages. Cell phone voice mail works much the same way, except that its based on wireless technology exclusively. Business voice mail and office voice mail can be based on- or off-site, using PC or proprietary equipment. Such systems operate multiple mailboxes and generally have an automated attendant that guides both internal and outside users through commands to leaving and retrieving messages. Uses: As with most communications technology, simplicity of use is a must with voice mail. Early systems were complicated and cumbersome, which meant only the largest corporations could afford to buy and maintain them. Now its easy to use a voice message system, whether its residential voice mail, cell phone voice mail or office voice mail.
11 Using voice mail, for the incoming caller, is as easy as dialing a phone number and speaking. After dialing, the partys phone will ring or, if prearranged, the call will be sent straight into voice mail. Once there, the caller will be instructed how to leave a message by the persons outgoing message.5) Web conferencing: Definition: Web conferencing is used to conduct live meetings, training, or presentations via the Internet. In a web conference, each participant sits at his or her own computer and is connected to other participants via the internet. This can be either a downloaded application on each of the attendees computers or a web-based application where the attendees access the meeting by clicking on a link distributed by e-mail (meeting invitation) to enter the conference. Types: There are 3 basic types of Web conferencing. I. Webcast: Webcast is an online broadcast that connects participants of the session via the Internet. This type of internet meeting is used mainly for online presentations. Webcast is available for hundreds of recipients simultaneously. But Webcast has limited audience interaction. II. Webinar: Webinar (from Web + seminar) has more interactive features as compared to a Webcast. So it allows conducting online seminars. It is perfect for question-and-answer-type sessions. III. Web Meeting: Web Meeting is the most advanced type of Web conferencing with the highest level of interaction opportunities. International businesses, corporations with branch offices across the country, companies that practice home working greatly benefit from online meeting. The participants of a Web Meeting can share documents, exchange information and converse in real time. Conducting a Web Meeting is possible even with a rudimentary system, a digital cam and a broadband connection. But the set-ups may vary. Basic features of Internet conference: Slide presentations, created in the Power Point, for instance. Live video. Video can be broadcast though a Webcam or a digital video camera. Whiteboard with annotation. This feature allows the presenter and other participants make notes on a blank whiteboard, or mark, or highlight important items on the slide presentation.
12 VoIP. (Voice over IP). This feature involves audio interaction in real time during a Web conference, via use of headphones and speakers. Recording. This enables all persons concerned to view the video record of the conference at a unique Web address at a later time. Surveys and polls. This allows the presenter to ask the audience questions with multiple choice answers. Text chat. This tool is used for live question and answer sessions for the conference attendees, either for all, or just for two. Screen/desktop/application sharing. Allows the attendees view the information displayed on the presenters screen. How to plan out and prepare for a Web conference? Here are some basic tips that will allow you to conduct your web conference successfully. Schedule the online meeting ahead of time, so you have enough time to prepare all necessary materials and information for the conference. Upload your presentation to the system beforehand and make sure the slide show works in a proper way. Notify the attendees of the meeting in advance. Send e-invitations with the data, meeting URL, exact time, audio materials and other information you find useful If you use a Power Point presentation in your conference, make sure the size of your presentation will be manageable for the attendees with slower Web connections. For that you can limit the amount of graphics or other less meaningful content components. If you want a feedback on your presentation in real time, make up questions and include them into your presentation. Test the system and make sure all features and applications function well. How to conduct an online meeting? Join the conference 15 minutes before the beginning, as it leader. This will give you the necessary time for the final preparation. You can go over the last minute details to make sure everything is perfectly ready for the session. Start the meeting with introduction of the event and its agendas. Try to get the participants involved from the very beginning. Keep your conference at a fast pace. Dynamic style of the meeting will help keep the participants tuned in. If you want to have maximum computer performance, close applications that you will not need for your conference. This will speed up the operations. When showing some applications or documents during the session, use the full screen option. This will have maximum impact on the participants.
13 If you want to share your desktop, make sure your personal information is securely hidden. Remember to close instant messaging and e-mail in order to avoid pop-ups. Electronic commerce: Definition: Electronic commerce is generally considered to be the sales aspect of e-business. It also consists of the exchange of data to facilitate the financing and payment aspects of the business transactions. Electronic commerce consists of the buying and selling of products or services over electronic systems such as the Internet and other computer networks. The amount of trade conducted electronically has grown extraordinarily with widespread Internet usage. The use of commerce is conducted in this way, spurring and drawing on innovations in electronic funds transfer, supply chain management, Internet marketing, online transaction processing, electronic data interchange (EDI), inventory management systems, and automated data collection systems. Modern electronic commerce typically uses the World Wide Web at least at some point in the transactions lifecycle, although it can encompass a wider range of technologies such as e-mail as well. A large percentage of electronic commerce is conducted entirely electronically for virtual items such as access to premium content on a website, but most electronic commerce involves the transportation of physical items in some way. Online retailers are sometimes known as e-tailers and online retail is sometimes known as e-tail. Almost all big retailers have electronic commerce presence on the World Wide Web. Electronic commerce that is conducted between businesses is referred to as business-to-business or B2B. B2B can be open to all interested parties (e.g. commodity exchange) or limited to specific, pre-qualified participants (private electronic market). Electronic commerce that is conducted between businesses and consumers, on the other hand, is referred to as business-to-consumer or B2C. This is the type of electronic commerce conducted by companies such as Amazon.com. Online shopping is a form of electronic commerce where the buyer is directly online to the sellers computer usually via the internet. There is no intermediary service. The sale and purchase transaction is completed electronically and interactively in real-time such as Amazon.com for new books. If an intermediary is present, then the sale and purchase transaction is called electronic commerce such as eBay.com. Difference between e-commerce and e-business:- EC is often confused with e-business. The basic differences between e-commerce and a-business are following:-
14 1. Electronic commerce focuses on the use of ICT to enable the external activities and relationships of the business with individuals, groups and other businesses, it constitutes the exchange of products and services between businesses, groups and individuals and can be seen as one of the essential activities of any business, whereas electronic business methods enable companies to link their internal and external data processing systems more efficiently and flexibly, to work more closely with suppliers and partners, and to better satisfy the needs and expectations of their customers. 2. E-business involves business processes spanning the entire value chain: electronic purchasing and supply chain management, processing orders electronically, handling customer service, and cooperating with business partners. Special technical standards for e-business facilitate the exchange of data between companies. E-business software solutions allow the integration of intra and inter firm business processes. E-business can be conducted using the Web, the Internet, intranets, extranets, or some combination of these. Whereas electronic commerce (EC) is the process of buying, transferring, or exchanging products, services, and/or information via computer networks, including the internet. EC can also be benefited from many perspective including business process, service, learning, collaborative, community. History:YEARS eCommerce development1979 online shopping1981 first B2B online shopping1982 Minitel was introduced nationwide Telecom and used for online ordering1984 first B2C online shopping1985 UK sells cars and finance with credit checking to customers online from dealers lots1990 Invention of WorldWideWeb(www)1994 1. Netscape introduce navigator browser Mozilla 2. Pizza Hut offers online ordering on its Web page 3. first online bank opens1995 Amazon.com and eBay.1998 Electronic postal stamps can be purchased and downloaded for printing from the Web1999 1. Business.com sold for US $7.5 million to eCompanies, which was purchased in 1997 for US $149,000. 2. The peer-to-peer file sharing software Napster launches
152002 Niche retail companies CSN Stores and NetShops are founded with the concept of selling products through several targeted domains, rather than a central portal2007 Business.com acquired by R.H. Donnelley for $345 million2009 Zappos.com acquired by Amazon.com for $928 million2010 US eCommerce and Online Retail sales projected to reach $173 billion, an increase of 7 percent over 2009 Application of e-commmerce:1. Internet marketing: Definition: Internet marketing is the marketing of products or services over the Internet. The Internet has brought media to a global audience. Internet marketing is sometimes considered to be broad in scope because it not only refers to marketing on the Internet, but also includes marketing done via e-mail and wireless media. Management of digital customer data and electronic customer relationship management (ECRM) systems are also often grouped together under internet marketing. Internet marketing ties together creative and technical aspects of the Internet, including: design, development, advertising, and sales. Internet marketing also refers to the placement of media along many different stages of the customer engagement cycle through search engine marketing (SEM), search engine optimization (SEO), banner ads on specific websites, e- mail marketing, and Web 2.0 strategies. In 2008, The New York Times - working with comScore - published an initial estimate to quantify the user data collected by large Internet-based companies. Counting four types of interactions with company websites in addition to the hits from advertisements served from advertising networks, the authors found the potential for collecting data upward of 2,500 times on average per user per month. Business models: Internet marketing is associated with several business models: e-commerce – this is where goods are sold directly to consumers (B2C) or businesses (B2B)
16 lead-based websites – an organization that generates value by acquiring sales leads from its website Affiliate marketing – the process in which a product or service developed by one entity (e-commerce business, single person, or a combination) is sold by other active sellers for a share of profits. Local internet marketing – through which a small company utilizes the Internet to find and nurture relationships, which are to be used for real-world advantage. Blackhat marketing – this is a form of internet marketing which employs deceptive, abusive, or less than truthful methods to drive web traffic to a website or affiliate marketing offer. This method sometimes includes spam, cloaking within search engine result pages, or routing users to pages they didnt initially request. Advantages: Inexpensive: Internet marketing is relatively inexpensive when compared to the ratio of cost against the reach of the target audience. Companies can reach a wide audience for a small fraction of traditional advertising budgets. The nature of the medium allows consumers to research and purchase products and services at their own convenience. Therefore, businesses have the advantage of appealing to consumers in a medium that can bring results quickly. The strategy and overall effectiveness of marketing campaigns depend on business goals and cost-volume- profit (CVP) analysis. Easy to access: Internet marketers also have the advantage of measuring statistics easily and inexpensively. Nearly all aspects of an Internet marketing campaign can be traced, measured, and tested. The advertisers can use a variety of methods: pay per impression, pay per click, pay per play, or pay per action. Therefore, marketers can determine which messages or offerings are more appealing to the audience. The results of campaigns can be measured and tracked immediately because online marketing initiatives usually require users to click on an advertisement, visit a website, and perform a targeted action. Such measurement cannot be achieved through billboard advertising, where an individual will at best be interested, then decide to obtain more information at a later time. Because exposure, response, and overall efficiency of Internet media are easier to track than traditional off-line media—through the use of web analytics for instance—Internet marketing can offer a greater sense of accountability for advertisers. Marketers and their clients are becoming aware of the need to measure the collaborative effects of marketing (i.e., how the Internet affects in- store sales) rather than siloing each advertising medium. The effects of multichannel marketing can be difficult to determine, but are an important part of ascertaining the value of media campaigns. Limitations:
18 Effects on industries: Online banking: The number of banks offering the ability to perform banking tasks over the internet has also increased. Online banking appeals to customers because it is often faster and considered more convenient than visiting bank branches. Currently over 150 million U.S. adults now bank online, with increasing Internet connection speed being the primary reason for fast growth in the online banking industry. Of those individuals who use the Internet, 44 percent now perform banking activities over the Internet. Internet auctions have become a multi-billion dollar business. Unique items that could only previously be found at flea markets are now being sold on Internet auction websites such as eBay. Specialized e-stores sell an almost endless amount of items ranging from antiques, movie props, clothing, gadgets and much more. As the premier online reselling platform, eBay is often used as a price-basis for specialized items. Buyers and sellers often look at prices on the website before going to flea markets; the price shown on eBay often becomes the items selling price. It is increasingly common for flea market sellers to place a targeted advertisement on the Internet for each item they are selling online, all while running their business out of their homes. In addition to the major effect internet marketing has had on the technology industry, the effect on the advertising industry itself has been intense. In just a few years, online advertising has grown to be worth tens of billions of dollars annually. PricewaterhouseCoopers reported that US$16.9 billion was spent on Internet marketing in the U.S. in 2006. Politics: This has had a growing impact on the electoral process. In 2008 candidates for President heavily utilized Internet marketing strategies to reach constituents. During the 2007 primaries candidates added, on average, over 500 social network supporters per day to help spread their message. President Barack Obama rose over US$1 million in a single day during his extensive Democratic candidacy campaign, largely due to online donors.2. Supply Chain Management Definitions: Supply Chain Management (SCM) is the management of a network of interconnected businesses involved in the ultimate provision of product and service packages required by end customers. Supply Chain Management spans all movement and storage of raw materials, work-in-process inventory, and finished goods from point of origin to point of consumption (supply chain).
19 APICS Dictionary defines SCM as the "design, planning, execution, control, and monitoring of supply chain activities with the objective of creating net value, building a competitive infrastructure, synchronizing supply with demand, and measuring performance globally." Problems addressed by Supply Chain Management Supply chain management must address the following problems: Distribution Network Configuration: number, location and network missions of suppliers, production facilities, distribution centers, warehouses, cross-docks and customers. Distribution Strategy: questions of operating control (centralized, decentralized or shared); delivery scheme, e.g., direct shipment, pool point shipping, cross docking, DSD (direct store delivery), closed loop shipping; mode of transportation, e.g., motor carrier, including truckload, parcel; railroad; intermodal transport, ocean freight; airfreight; and transportation control (e.g., owner- operated, private carrier, common carrier, contract carrier). Trade-Offs in Logistical Activities: The above activities must be well coordinated in order to achieve the lowest total logistics cost. Trade-offs may increase the total cost if only one of the activities is optimized. For example, full truckload (FTL) rates are more economical on a cost per pallet basis than less than truckload (LTL) shipments. If, however, a full truckload of a product is ordered to reduce transportation costs, there will be an increase in inventory holding costs which may increase total logistics costs. It is therefore imperative to take a systems approach when planning logistical activities. This trade-offs are key to developing the most efficient and effective Logistics and SCM strategy. Information: Integration of processes through the supply chain to share valuable information, including demand signals, forecasts, inventory, transportation, potential collaboration, etc. Supply chain execution means managing and coordinating the movement of materials, information and funds across the supply chain. The flow is bi-directional. Activities/functions Reducing ownership of raw materials: As organizations strive to focus on core competencies and becoming more flexible, they reduce their ownership of raw materials sources and distribution channels. These functions are increasingly being outsourced to other entities that can perform the activities better or more cost effectively. The effect is to increase the number of organizations involved in satisfying customer demand, while reducing management control of daily logistics operations. Less control and more supply chain partners led to the creation of supply chain management concepts. The purpose of supply chain
20 management is to improve trust and collaboration among supply chain partners, thus improving inventory visibility and the velocity of inventory movement. Several models have been proposed for understanding the activities required to manage material movements across organizational and functional boundaries. SCOR is a supply chain management model promoted by the Supply Chain Council. Another model is the SCM Model proposed by the Global Supply Chain Forum. Supply chain activities can be grouped into strategic, tactical, and operational levels. The CSCMP has adopted The American Productivity & Quality Center (APQC) Process Classification Framework a high-level, industry- neutral enterprise process model that allows organizations to see their business processes from a cross-industry viewpoint. Importance of Supply Chain Management Organizations increasingly find that they must rely on effective supply chains, or networks, to compete in the global market and networked economy. In Peter Druckers (1998) new management paradigms, this concept of business relationships extends beyond traditional enterprise boundaries and seeks to organize entire business processes throughout a value chain of multiple companies. During the past decades, globalization, outsourcing and information technology have enabled many organizations, such as Dell and Hewlett Packard, to successfully operate solid collaborative supply networks in which each specialized business partner focuses on only a few key strategic activities. In the 21st century, changes in the business environment have contributed to the development of supply chain networks. First, as an outcome of globalization and the production of multinational companies, joint projects, strategic alliances and business partnerships, significant success factors were identified, complementing the earlier "Just-In-Time", "Lean Manufacturing" and "Agile Manufacturing" practices. Second, technological changes, particularly the dramatic fall in information communication costs, which are a significant component of transaction costs, have led to changes in coordination among the members of the supply chain network. Many researchers have recognized these kinds of supply network structures as a new organization form, using terms such as "Extended Enterprise", "Virtual Corporation", "Global Production Network", and "Next Generation Manufacturing System". In general, such a structure can be defined as "a group of semi-independent organizations, each with their capabilities, which collaborate in ever-changing constellations to serve one or more markets in order to achieve some business goal specific to that collaboration‖. Historical developments in Supply Chain Management Six major movements can be observed in the evolution of supply chain management studies: Creation, Integration, and Globalization, Specialization Phases One and Two, and SCM 2.0. SESSIONS DEVELOPMENT 1. Creation Era Re-engineering, downsizing driven by cost reduction programs, and widespread attention to the Japanese practice of management.(1980)
21 2. Integration Era Electronic Data Interchange (EDI) (1960), Enterprise Resource Planning (ERP) (1990), internet-based collaborative systems, 3. Globalization Era Expansion of supply chains over national boundaries and into other continents (1980). 4.Specialization Era Outsourced manufacturing and Distribution (1980), Supply Chain Management as a Service (1990). Supply chain business process integration Supply chain business process integration involves collaborative work between buyers and suppliers, joint product development, common systems and shared information. The processes are described below:a. Customer service management: Successful organizations use the following steps to build customer relationships: I. determine mutually satisfying goals for organization and customers II. establish and maintain customer rapport III. produce positive feelings in the organization and the customersb. Procurement : Strategic plans are drawn up with suppliers to support the manufacturing flow management process and the development of new products. In firms where operations extend globally, sourcing should be managed on a global basis. The desired outcome is a win-win relationship where both parties benefit, and a reduction in time required for the design cycle and product development. Also, the purchasing function develops rapid communication systems, such as electronic data interchange (EDI) and Internet linkage to convey possible requirements more rapidly. Activities related to obtaining products and materials from outside suppliers involve resource planning, supply sourcing, negotiation, order placement, inbound transportation, storage, handling and quality assurance, many of which include the responsibility to coordinate with suppliers on matters of scheduling, supply continuity, hedging, and research into new sources or programs.c. Product development and commercialization: Customers and suppliers must be integrated into the product development process in order to reduce time to market. Managers of the product development and commercialization process must: I. coordinate with customer relationship management to identify customer- articulated needs, II. select materials and suppliers in combination with procurement, III. Develop production technology in manufacturing flow to manufacture and integrate into the best supply chain flow for the product/market combination.
22d. Manufacturing flow management/support: The manufacturing process produces and supplies products to the distribution channels based on past forecasts. Manufacturing processes must be flexible to respond to market changes and must accommodate mass customization. Orders are processes operating on a just-in-time (JIT) basis in minimum lot sizes. Also, changes in the manufacturing flow process lead to shorter cycle times, meaning improved responsiveness and efficiency in meeting customer demand. Activities related to planning, scheduling and supporting manufacturing operations, such as work-in-process storage, handling, transportation, and time phasing of components, inventory at manufacturing sites and maximum flexibility in the coordination of geographic and final assemblies postponement of physical distribution operations.e. Physical distribution: This concerns movement of a finished product/service to customers. In physical distribution, the customer is the final destination of a marketing channel, and the availability of the product/service is a vital part of each channel participants marketing effort. It is also through the physical distribution process that the time and space of customer service become an integral part of marketing, thus it links a marketing channel with its customers (e.g., links manufacturers, wholesalers, retailers).f. Outsourcing/partnerships: This is not just outsourcing the procurement of materials and components, but also outsourcing of services that traditionally have been provided in-house. The logic of this trend is that the company will increasingly focus on those activities in the value chain where it has a distinctive advantage, and outsource everything else. This movement has been particularly evident in logistics where the provision of transport, warehousing and inventory control is increasingly subcontracted to specialists or logistics partners. Also, managing and controlling this network of partners and suppliers requires a blend of both central and local involvement. Hence, strategic decisions need to be taken centrally, with the monitoring and control of supplier performance and day-to-day liaison with logistics partners being best managed at a local level.g. Performance measurement: Experts found a strong relationship from the largest arcs of supplier and customer integration to market share and profitability. Taking advantage of supplier capabilities and emphasizing a long-term supply chain perspective in customer relationships can both be correlated with firm performance. According to experts, internal measures are generally collected and analyzed by the firm including i. Cost ii. Customer Service iii. Productivity measures iv. Asset measurement, and v. Quality.
233. ONLINE SHOPINGOnline shopping is the process whereby consumers directly buy goods or services from a sellerin real-time, without an intermediary service, over the Internet. If an intermediary service ispresent the process is called electronic commerce. An online shop, eshop, e-store, internet shop,webshop, webstore, online store, or virtual store evokes the physical analogy of buying productsor services at a bricks-and-mortar retailer or in a shopping mall. The process is called Business-to-Consumer (B2C) online shopping. When a business buys from another business it is calledBusiness-to-Business (B2B) online shopping. Both B2C and B2B online shopping are forms ofe-commerce. History a) In 1994, online banking and the opening of an online pizza shop by Pizza Hut. b) During that same year, Netscape introduced SSL encryption of data transferred online, which has become essential for secure online shopping. c) Also in 1994 the German company Intershop introduced its first online shopping system. d) In 1995 Amazon launched its online shopping site, and in 1996 eBay appeared. Webshop The term webshop has a number of meanings as a noun. An online retailer may be called a webshop. Web development, hosting and other web-related activities can be called webshops‘. The word webshop is also used as a verb- I will webshop for that. Buying online grew because, over time, transportation costs went up and telecom costs went down and access to the Internet became commonplace. Online shopping offers a larger selection of goods and services and thus greater choice at optimal prices. The problems with online shopping are that you cannot smell, touch, taste or try what you are buying. Customers In recent years, online shopping has become popular; however, it still caters to the middle and upper class. In order to shop online, one must be able to have access to a computer, a bank account and a debit card. Shopping has evolved with the growth of technology. According to research found in the Journal of Electronic Commerce, if we focus on the demographic characteristics of the in-home shopper, in general, the higher the level of education, income, and occupation of the head of the household, the more favourable the perception of non-store shopping. An influential factor in consumer attitude towards non-store shopping is exposure to technology, since it has been demonstrated that increased exposure to technology increases the probability of developing favourable attitudes towards new shopping channels. Online shopping widened the target audience to men and women of the middle class. At first, the main users of online shopping were young men with a high level of income and a university education. This profile is changing. For example, in USA in the early years of Internet there were very few women users, but by
24 2001 women were 52.8% of the online population. Sociocultural pressure has made men generally more independent in their purchase decisions, while women place greater value on personal contact and social relations. Logistics Consumers find a product of interest by visiting the website of the retailer directly, or do a search across many different vendors using a shopping search engine. Once a particular product has been found on the web site of the seller, most online retailers use shopping cart software to allow the consumer to accumulate multiple items and to adjust quantities, by analogy with filling a physical shopping cart or basket in a conventional store. A "checkout" process follows (continuing the physical-store analogy) in which payment and delivery information is collected, if necessary. Some stores allow consumers to sign up for a permanent online account so that some or all of this information only needs to be entered once. The consumer often receives an e-mail confirmation once the transaction is complete. Less sophisticated stores may rely on consumers to phone or e-mail their orders (though credit card numbers are not accepted by e-mail, for security reasons). I. Payment Online shoppers commonly use credit card to make payments, however some systems enable users to create accounts and pay by alternative means, such as: Debit card Various types of electronic money Cash on delivery (C.O.D., offered by very few online stores) Cheque Wire transfer/delivery on payment Postal money order Reverse SMS billing to mobile phones Gift cards Direct debit in some countries II. Product delivery Once a payment has been accepted the goods or services can be delivered in the following ways. Download: This is the method often used for digital media products such as software, music, movies, or images. Shipping: The product is shipped to the customers address.
25 Drop shipping: The order is passed to the manufacturer or third-party distributor, who ships the item directly to the consumer, bypassing the retailers physical location to save time, money, and space. In-store pickup: The customer orders online, finds a local store using locator software and picks the product up at the closest store. This is the method often used in the bricks and clicks business model. In the case of buying an admission card, fee receipt or ticket one may get a code, or they can be printed out. At the premises it is made sure that the same right of admission is not used twice. III. Shopping cart systems Simple systems allow the offline administration of products and categories. The shop is then generated as HTML files and graphics that can be uploaded to a webspace. These systems do not use an online database. A high end solution can be bought or rented as a standalone program or as an addition to an enterprise resource planning program. It is usually installed on the companys own webserver and may integrate into the existing supply chain so that ordering, payment, delivery, accounting and warehousing can be automated to a large extent. Other solutions allow the user to register and create an online shop on a portal that hosts multiple shops at the same time. Commercial systems can also be tailored to ones needs so that the shop does not have to be created from scratch. By using a framework already existing, software modules for different functionalities required by a web shop can be adapted and combined. Market share E-commerce B2C product sales totaled $146.4 billion in the United States in 2006, representing about 6% of retail product sales in the country. The $18.3 billion worth of clothes sold online represented about 10% of the domestic market. For developing countries and low-income households in developed countries, adoption of e- commerce in place of or in addition to conventional methods is limited by a lack of affordable Internet access. Estimated data of some websites: I. eBay: Description- Buy and sell electronics, cars, clothing, apparel, collectibles, sporting goods, digital cameras, and everything else on eBay, the worlds online marketplace. Sign up and begin to buy and sell - auction or buy it now - almost anything on eBay.com
26 Daily Pageview – 52380952, Daily Ads Revenue - $157145.68. II. amazon.com: Description- Online shopping from the earths biggest selection of books, magazines, music, DVDs, videos, electronics, computers, software, apparel & accessories, shoes, jewelry, tools & hardware, housewares, furniture, sporting goods, beauty & personal care, broadband & dsl, gourmet food & just about anything else. Daily Pageview - 73333333, Daily Ads Revenue - $220003. Advantages I. Convenience Online stores are usually available 24 hours a day, and many consumers have Internet access both at work and at home. Other establishments such as internet cafes and schools provide access as well. A visit to a conventional retail store requires travel and must take place during business hours. In the event of a problem with the item – it is not what the consumer ordered, or it is not what they expected – consumers are concerned with the ease with which they can return an item for the correct one or for a refund. Consumers may need to contact the retailer, visit the post office and pay return shipping, and then wait for a replacement or refund. Some online companies have more generous return policies to compensate for the traditional advantage of physical stores. For example, the online shoe retailer Zappos.com includes labels for free return shipping, and does not charge a restocking fee, even for returns which are not the result of merchant error. II. Information and reviews Online stores must describe products for sale with text, photos, and multimedia files, whereas in a physical retail store, the actual product and the manufacturers packaging will be available for direct inspection (which might involve a test drive, fitting, or other experimentation). Some online stores provide or link to supplemental product information, such as instructions, safety procedures, demonstrations, or manufacturer specifications. Some provide background information, advice, or how-to guides designed to help consumers decide which product to buy.
27 Some stores even allow customers to comment or rate their items. There are also dedicated review sites that host user reviews for different products. In a conventional retail store, clerks are generally available to answer questions. Some online stores have real-time chat features, but most rely on e-mail or phone calls to handle customer questions. III. Price and selection: One advantage of shopping online is being able to quickly seek out deals for items or services with many different vendors (though some local search engines do exist to help consumers locate products for sale in nearby stores). Search engines, online price comparison services and discovery shopping engines can be used to look up sellers of a particular product or service. Shipping costs (if applicable) reduce the price advantage of online merchandise, though depending on the jurisdiction, a lack of sales tax may compensate for this. Shipping a small number of items, especially from another country, is much more expensive than making the larger shipments bricks-and-mortar retailers order. Some retailers (especially those selling small, high-value items like electronics) offer free shipping on sufficiently large orders. Disadvantages I. Fraud and security concerns Given the lack of ability to inspect merchandise before purchase, consumers are at higher risk of fraud on the part of the merchant than in a physical store. Merchants also risk fraudulent purchases using stolen credit cards or fraudulent repudiation of the online purchase. With a warehouse instead of a retail storefront, merchants face less risk from physical theft II. Lack of full cost disclosure The lack of full disclosure with regards to the total cost of purchase is one of the concerns of online shopping. While it may be easy to compare the base price of an item online, it may not be easy to see the total cost up front as additional fees such as shipping are often not be visible until the final step in the checkout process. III. Privacy Privacy of personal information is a significant issue for some consumers. Different legal jurisdictions have different laws concerning consumer privacy, and different levels of enforcement. Many consumers wish to avoid spam and telemarketing which could result
28 from supplying contact information to an online merchant. In response, many merchants promise not to use consumer information for these purposes, or provide a mechanism to opt-out of such contacts. How e-business affect GDP of India? E-business accounts for a 5.19% of the countrys GDP and export earnings as of 2009, while providing employment to a significant number of its tertiary sector workforce. More than 2.3 million people are employed in the sector either directly or indirectly, making it one of the biggest job creators in India and a mainstay of the national economy. In March 2009, annual revenues from outsourcing operations in India amounted to US$50 billion and this is expected to increase to US$225 billion by 2020. The most prominent IT hub is IT capital Bangalore. Top seven hubs are following: Region Description Bangalore Popularly known as the capital of the Silicon Valley of India is currently leading in Information Technology Industries in India. Chennai Famously known as "Gateway of South India", it is the second largest exporter of Software Hyderabad Hyderabad which has good infrastructure and good government support is also a good technology base in India. Pune Pune, a major industrial town, hosts numerous multinational and national software giants along with BPO and KPO firms. World class SEZs like Hinjawadi IT park and Magarpatta city give Pune a distinct advantage. The city is a major educational hub and churns out thousands of technocrats every year. Kolkata Kolkata which is slowly becoming a major IT hub in near future. NCR The National Capital Region of India comprising Delhi, Gurgaon, Faridabad, Noida, Greater Noida and Ghaziabad are having ambitious projects and are trying to do every possible thing for this purpose. Mumbai Popularly known as the commercial, entertainment, financial capital of India, This is one city that has seen tremendous growth in IT and BPO industry, it recored 63% growth in 2008. TCS, Patni, LnT Infotech, I-Flex WNS and other companies are headquartered here. India’s IT industries businesses are following: Particulars In 2004 In 2006 In 2008 In 2009IT Services 10.4 13.5 17.8 23.7
29 -exports 7.3 10.0 13.13 18.1 -domestic 3.1 3.5 4.5 5.6ITES-BPO 3.4 5.2 7.2 9.5-exports 3.1 4.6 6.3 8.3-domestic 0.3 0.6 0.9 1.2Engineering 2.9 3.9 5.3 6.5services, R&D andSoftware products-exports 2.5 3.1 4.0 4.9-domestic 0.4 0.7 1.3 1.6Total IT industry 21.6 28.4 37.4 47.8-exports 13.4 18.2 24.1 31.9-domestic 8.3 10.2 13.2 15.9 CONCLUSION: A developing country can become industrialized and modernized if it can extensively apply IT to enhance productivity and international competitiveness, develop e-commerce applications. An information-based society or knowledge based society is composed of IT products, IT applications in society and economy as a whole. Many countries in Asia are taking advantage of e-commerce through opening of economies, which is essential for promoting competition and diffusion of Internet technologies. The Internet is boosting efficiency and enhancing market integration in developing countries. The developed world has had a long lead over the developing countries in the telecom infrastructure. The world average of teledensity is 15 per cent compared to the developed world average of 55 to 60 per cent. Same is true of PCs, Internet connections, and the number of Internet hosts. All these traditional indicators for India as seen above are still small. But the total numbers of Internet connections are large in absolute numbers. Large enough to have a critical mass of 10 to 20 million users to be able to make an impact on e-commerce and e-governance. In the next 3 to 5 years, India will have 30 to 70 million Internet users which will equal, if not surpass, many of the developed countries. Internet economy will then become more meaningful in India. The number of e-transactions will be large enough to sustain the Internet economy.
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