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chapter8.ppt

  1. 1. Chapter 8 B2B Support Services
  2. 2. Learning Objectives <ul><li>Identify the major B2B services usually provided by specialized e-service providers </li></ul><ul><li>Understand why EC services are frequently outsourced </li></ul><ul><li>Describe the role and types of e-strategy consultants </li></ul><ul><li>Understand the e-infrastructure process and the role of Web hosting and integration </li></ul><ul><li>Describe various financial services in B2B </li></ul>
  3. 3. <ul><li>Explain the various B2B logistics services and order fulfillment services </li></ul><ul><li>Differentiate B2C from B2B with respect to marketing, advertisement, and sales, and describe some B2B initiatives </li></ul><ul><li>Describe content creation, syndication, delivery, and management </li></ul><ul><li>Describe the role of directory services in B2B </li></ul><ul><li>Describe how CRM is done in B2B and its relationships with e-communities </li></ul>Learning Objectives (cont.)
  4. 4. Hewlett Packard Closes the Payment Gap in B2B E-Commerce <ul><li>HP payment solution—seamless electronic B2B payment </li></ul><ul><ul><li>Two components are preintegrated and provide end-to-end automation </li></ul></ul><ul><ul><ul><li>Embedded options that establish rules to facilitate direct debit payment options </li></ul></ul></ul><ul><ul><ul><ul><li>Buyer accounts </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Purchasing limits </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Corporate discounting </li></ul></ul></ul></ul><ul><ul><ul><li>The system connects all these accounts with their online financial institutions </li></ul></ul></ul>
  5. 5. Hewlett Packard Closes the Payment Gap in B2B E-Commerce (cont.) <ul><li>HP payment solution </li></ul><ul><ul><li>The integrated system reduces cost of: </li></ul></ul><ul><ul><ul><li>Order processing </li></ul></ul></ul><ul><ul><ul><li>Contract administration </li></ul></ul></ul><ul><ul><ul><li>Customer service </li></ul></ul></ul><ul><ul><li>Captures and analyzes information that allows company to offer unique purchasing experience </li></ul></ul><ul><ul><ul><li>Customers—best value online experience </li></ul></ul></ul><ul><ul><ul><li>Partners—handle complex transactions quickly and securely </li></ul></ul></ul><ul><ul><ul><li>Employees—reduce cost and time for processing </li></ul></ul></ul>
  6. 6. Figure 8-1 Electronic Commerce Services and Analysis Insert Fig 8.1 here Source : Choi et al., The Economics of Electronic Commerce (Indianapolis: Macmillan Technical Publications, (1997), p. 18.
  7. 7. EC Services: Overview & Services (cont.) <ul><ul><li>Why outsource B2B services? </li></ul></ul><ul><ul><ul><li>Desire to concentrate on core business </li></ul></ul></ul><ul><ul><ul><li>Need to have services up and running quickly </li></ul></ul></ul><ul><ul><ul><li>Lack of expertise for support services </li></ul></ul></ul><ul><ul><ul><li>Economy of scale for project not possible from inside </li></ul></ul></ul><ul><ul><ul><li>In-house options do not keep up with rapidly changing demands </li></ul></ul></ul><ul><ul><ul><li>Too many services for one company to handle </li></ul></ul></ul>
  8. 8. <ul><ul><li>Steps in the process of developing and managing EC applications </li></ul></ul><ul><ul><ul><li>EC strategy formulation </li></ul></ul></ul><ul><ul><ul><li>Application design </li></ul></ul></ul><ul><ul><ul><li>Building (or buying) application </li></ul></ul></ul><ul><ul><ul><li>Hosting, operating, and maintaining EC </li></ul></ul></ul>EC Services: Overview & Services (cont.)
  9. 9. Figure 8-2 EC Application Development Process
  10. 10. Figure 8-3 The Evolution of E-Marketplaces
  11. 11. Consulting Services <ul><li>E-strategy </li></ul><ul><ul><li>Consultants help determine which specific EC applications to implement </li></ul></ul><ul><ul><li>First step in infrastructure development </li></ul></ul><ul><li>Technology </li></ul><ul><ul><li>Consultants advise companies on technology issues </li></ul></ul><ul><ul><ul><li>EC architecture </li></ul></ul></ul><ul><ul><ul><li>Security </li></ul></ul></ul>
  12. 12. Consulting Services (cont.) <ul><li>Four types of consulting firms </li></ul><ul><ul><li>Provide expertise in area of EC </li></ul></ul><ul><ul><li>Traditional firms that maintain divisions focused on EC </li></ul></ul><ul><ul><li>A large firm that consists of many small firms that specialize in EC </li></ul></ul><ul><ul><li>Hardware and software vendors that provide consulting services </li></ul></ul>
  13. 13. Application-Building Services and Required Standards <ul><li>Services that support B2B applications </li></ul><ul><ul><li>Utilized by in-house design teams putting together system that incorporates best-of-breed EC components (building blocks) </li></ul></ul><ul><ul><li>Vendors and system integrators may do the job </li></ul></ul><ul><ul><li>EC components can be: </li></ul></ul><ul><ul><ul><li>Special-purpose niche tools (tax-calculation) </li></ul></ul></ul><ul><ul><ul><li>Broad packages that facilitate all aspects of successful transactions online </li></ul></ul></ul>
  14. 14. Application-Building Services and Required Standards (cont.) <ul><li>Industry standards—XML, XSL, and support organizations </li></ul><ul><ul><li>Efficient interaction between B2B companies necessitates connection of: </li></ul></ul><ul><ul><ul><li>Servers </li></ul></ul></ul><ul><ul><ul><li>Applications </li></ul></ul></ul><ul><ul><ul><li>Databases </li></ul></ul></ul><ul><ul><li>Standard protocols and data representation schemes are needed </li></ul></ul>
  15. 15. Application-Building Services and Required Standards (cont.) <ul><li>Industry standards </li></ul><ul><ul><li>XML—improve compatibility between disparate system by defining meaning of data in business documents </li></ul></ul><ul><ul><li>XSL– and XML require international agreements and cooperation </li></ul></ul><ul><ul><li>Support organizations </li></ul></ul><ul><ul><ul><li>UN body for facilitation of EC </li></ul></ul></ul><ul><ul><ul><li>W3C—XML and other EC standards </li></ul></ul></ul><ul><ul><ul><li>RosettaNet—supply chain topics </li></ul></ul></ul>
  16. 16. Web Hosting and Other Services <ul><li>Business hosting—hosting is popular for SMEs; large businesses need more advanced services </li></ul><ul><ul><li>Dedicated server—assigned for specific purpose or customer </li></ul></ul><ul><ul><li>Co-location (physical location for the server) </li></ul></ul><ul><ul><li>Free Web hosting attractive option for small start-ups </li></ul></ul><ul><ul><ul><li>Provider company inserts a banner ad on their site </li></ul></ul></ul><ul><ul><ul><li>Starting point for small company—minimize start-up costs </li></ul></ul></ul>
  17. 17. Web Hosting and Other Services (cont.) <ul><li>Sources of information about Web hosting </li></ul><ul><ul><li>Web Host Review ( hostreview.com ): how to select free Web hosting based on various criteria </li></ul></ul><ul><ul><li>Host Search ( hostsearch.com ): search engine recommends best host based on: </li></ul></ul><ul><ul><ul><li>Monthly cost </li></ul></ul></ul><ul><ul><ul><li>Disk space requirements </li></ul></ul></ul><ul><ul><ul><li>Monthly transfer volume </li></ul></ul></ul><ul><ul><ul><li>Other </li></ul></ul></ul><ul><ul><li>WebHosting Magazine (whmag.com):comprehensive information for members of Web hosting industry and those looking for outsources </li></ul></ul>
  18. 18. Web Hosting and Other Services (cont.) <ul><li>Management service provider (MSP) </li></ul><ul><ul><li>Deliver IT infrastructure management services </li></ul></ul><ul><ul><li>Multiple customers over networks on a subscription basis </li></ul></ul><ul><ul><li>Specialize in e-business and enterprise solutions </li></ul></ul><ul><ul><li>See imspassociation.org and crosscommerce.com </li></ul></ul>
  19. 19. Web Hosting and Other Services (cont .) <ul><li>End-to-end solutions </li></ul><ul><ul><li>Builds Web sites and EC applications from conceptual design to deployment </li></ul></ul><ul><ul><li>Also supply: </li></ul></ul><ul><ul><ul><li>Payment systems </li></ul></ul></ul><ul><ul><ul><li>Delivery management </li></ul></ul></ul><ul><ul><ul><li>Site monitoring </li></ul></ul></ul><ul><ul><ul><li>Other services </li></ul></ul></ul><ul><ul><ul><li>See bccentral.com and WebVision.com </li></ul></ul></ul>
  20. 20. Figure 8-4 Participants and Process of Using a Purchasing Card Source : napcp.org/napcp.nsf/Cardparticipants!OpenPage. Used with permission of NAPCP.
  21. 21. Financial B2B Services (cont.) <ul><li>Payments (cont.) </li></ul><ul><ul><li>Electronic letters of credit </li></ul></ul><ul><ul><ul><li>Benefits to seller </li></ul></ul></ul><ul><ul><ul><ul><li>Credit risk reduced </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Payment highly assured </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Political/country risk reduced </li></ul></ul></ul></ul><ul><ul><ul><li>Benefits to the buyer </li></ul></ul></ul><ul><ul><ul><ul><li>Allows negotiation of lower purchase price </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Expansion of supply sources </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Payment received after document inspected by issuing bank </li></ul></ul></ul></ul>
  22. 22. Financial B2B Services (cont.) <ul><li>Payments (cont.) </li></ul><ul><ul><li>Payments in B2B global trading </li></ul></ul><ul><ul><li>Venture capital to fund e-commerce initiatives </li></ul></ul><ul><ul><li>Internet incubators </li></ul></ul><ul><ul><li>Tax calculation services </li></ul></ul><ul><ul><ul><li>DPC </li></ul></ul></ul><ul><ul><ul><li>HotSamba </li></ul></ul></ul><ul><ul><ul><li>Sales tax clearinghouse </li></ul></ul></ul><ul><ul><ul><li>Taxware international </li></ul></ul></ul><ul><ul><li>Implementing tax collection in the U.S. </li></ul></ul>
  23. 23. Financial B2B Services (cont.) <ul><li>Payments (cont.) </li></ul><ul><ul><li>Other financial services </li></ul></ul><ul><ul><ul><li>Credit reporting firms </li></ul></ul></ul><ul><ul><ul><li>New credit intermediaries broker credit risks </li></ul></ul></ul><ul><ul><ul><li>Assurance firms guarantee quality </li></ul></ul></ul><ul><ul><ul><li>Exchanges strike insurance deals </li></ul></ul></ul><ul><ul><ul><li>E-credit services </li></ul></ul></ul>
  24. 24. Figure 8-5 Transaction-Based Financing Source : Aberdeen Group, Inc. November 2000
  25. 25. Order Fulfillment, Logistics, and Supply Chain Services <ul><li>Supply chain management </li></ul><ul><ul><li>Reengineering & managing complex supply chains </li></ul></ul><ul><ul><ul><li>Supplier </li></ul></ul></ul><ul><ul><ul><li>Manufacturer </li></ul></ul></ul><ul><ul><ul><li>Distributor </li></ul></ul></ul><ul><ul><ul><li>Customer </li></ul></ul></ul><ul><li>Transportation services </li></ul><ul><ul><li>Manages complex </li></ul></ul><ul><ul><ul><li>Transportation networks </li></ul></ul></ul><ul><ul><ul><li>Dedicated fleets </li></ul></ul></ul><ul><ul><ul><li>Carriers </li></ul></ul></ul><ul><ul><ul><li>Multimodel shipments </li></ul></ul></ul>UPS Logistics Group
  26. 26. Order Fulfillment, Logistics, and Supply Chain Services (cont.) <ul><li>Parts distribution </li></ul><ul><ul><li>Comprehensive return-and-repair </li></ul></ul><ul><ul><li>Parts distributions operations </li></ul></ul><ul><li>Logistics technologies </li></ul><ul><ul><li>Integration of logistics information systems </li></ul></ul><ul><ul><li>Services to provide supply chain visibility </li></ul></ul><ul><li>EC solutions </li></ul><ul><ul><li>Logistics services </li></ul></ul><ul><ul><li>Web-based businesses worldwide </li></ul></ul><ul><li>Global services </li></ul><ul><ul><li>Logistics facilities </li></ul></ul><ul><ul><li>Staffing </li></ul></ul><ul><ul><li>Expertise about global commerce </li></ul></ul>
  27. 27. Order Fulfillment, Logistics, and Supply Chain Services (cont.) <ul><li>Call center services </li></ul><ul><ul><li>Customer care </li></ul></ul><ul><ul><li>Communications (call center services to EC capabilities) </li></ul></ul><ul><li>Financial services—full range of financial services that complement: </li></ul><ul><ul><li>Logistics </li></ul></ul><ul><ul><li>Transporting </li></ul></ul><ul><ul><li>Additional business needs </li></ul></ul><ul><li>Solutions for EC initiatives </li></ul><ul><ul><li>Tracking systems </li></ul></ul><ul><ul><li>Product return systems </li></ul></ul><ul><ul><li>Shipping solutions </li></ul></ul><ul><ul><li>E-document exchange </li></ul></ul><ul><ul><li>Customization </li></ul></ul><ul><ul><ul><li>EC software/providers </li></ul></ul></ul><ul><ul><ul><li>E-services/partners </li></ul></ul></ul>
  28. 28. Marketing and Advertisement <ul><li>Advertising methods used by offline marketers </li></ul><ul><ul><li>Vertical trade show </li></ul></ul><ul><ul><li>Ads in industry magazines </li></ul></ul><ul><ul><li>Salespeople call on: </li></ul></ul><ul><ul><ul><li>Existing customers </li></ul></ul></ul><ul><ul><ul><li>Potential buyers </li></ul></ul></ul><ul><li>Digital advertisers </li></ul><ul><ul><li>Ad server network provider </li></ul></ul><ul><ul><li>Electronic wholesalers </li></ul></ul>
  29. 29. Figure 8-6 The Architecture of Ad Server Networks Source : Warkentin, Merrill, Vijayan Sugumaran, and Ravi Bapna. “eKnowledge Networks for Inter-Organizational Collaborative eBusiness,” Logistics Information Management, Vol. 14, No. 1/2, March 2001, pp. 149 – 162. Used with permission of MCB University Press.
  30. 30. Affiliate Programs <ul><li>Affiliate programs (B2C services) </li></ul><ul><ul><li>Affiliates invited to put a banner of a vendor on their sites </li></ul></ul><ul><ul><li>Consumer clicks on the banner and brings up that company’s EC site </li></ul></ul><ul><ul><li>Commission paid to affiliate if customer makes a purchase </li></ul></ul>© Prentice Hall, 2002
  31. 31. Infomediaries <ul><li>Infomediary services </li></ul><ul><ul><li>Collect data about consumer behavior </li></ul></ul><ul><ul><li>Analyze it </li></ul></ul><ul><ul><li>Repackage it </li></ul></ul><ul><ul><li>Sell the results </li></ul></ul><ul><ul><ul><li>As marketing and profiling information </li></ul></ul></ul><ul><ul><ul><li>Purpose to increase customer loyalty </li></ul></ul></ul><ul><ul><li>Identify likely buyers </li></ul></ul><ul><ul><ul><li>Increased sales </li></ul></ul></ul><ul><ul><ul><li>Reduced marketing costs </li></ul></ul></ul>
  32. 32. Online Data Mining Services <ul><li>Clickstream data—data collected by monitoring what people do online </li></ul><ul><li>Analyzed and mined to produce useful knowledge used to improve: </li></ul><ul><ul><li>Services </li></ul></ul><ul><ul><li>Marketing efforts </li></ul></ul><ul><li>Firms use these services to extend their ability to execute EC a successful strategy </li></ul><ul><ul><li>NetTracker </li></ul></ul><ul><ul><li>WebTrends </li></ul></ul>
  33. 33. Other Marketing Services <ul><li>Three examples of other services: </li></ul><ul><ul><li>Digitalcement.com provides corporate marketing portals; builds stronger relationships with customers </li></ul></ul><ul><ul><li>Vantagenet.com free tools that help ease traffic to a company’s Web site </li></ul></ul><ul><ul><li>Businesstown.com has an online directory that enables small businesses to identify and evaluate service companies </li></ul></ul>
  34. 34. Figure 8-7 Digital Delivery Content Life Cycle
  35. 35. Content Generation, Syndication, Delivery, and Management (cont.) <ul><li>Syndication </li></ul><ul><li>Content-delivery networks (CDNs) </li></ul><ul><li>Catalog content </li></ul><ul><li>Content management options </li></ul><ul><ul><li>Do it yourself </li></ul></ul><ul><ul><li>Let the suppliers do it </li></ul></ul><ul><ul><li>Buy the content from an aggregator </li></ul></ul><ul><ul><li>Subscribe to a vertical exchange </li></ul></ul><ul><ul><li>Outsource to full-service Internet exchange </li></ul></ul>
  36. 36. Content Generation, Syndication, Delivery, and Management (cont.) <ul><li>Content maximization and streaming services—companies provide media rich content to reach target audience </li></ul><ul><ul><li>Video clips </li></ul></ul><ul><ul><li>Music </li></ul></ul><ul><ul><li>Flash media </li></ul></ul><ul><li>Use content delivery solutions that do not cause “traffic jams” with slow download times (e.g., Akamai Corporation) </li></ul>
  37. 37. Directory Services & Search Engines <ul><li>Directory services </li></ul><ul><ul><li>B2Business.net </li></ul></ul><ul><ul><li>B2BToday.com </li></ul></ul><ul><ul><li>Communityb2b.com </li></ul></ul><ul><ul><li>A2zofb2b.com </li></ul></ul><ul><ul><li>I-stores.co.uk </li></ul></ul><ul><ul><li>Websteronline.com </li></ul></ul><ul><ul><li>Thomasregister.com </li></ul></ul><ul><ul><li>Bocal.com </li></ul></ul><ul><ul><li>B2b.yahoo.com </li></ul></ul><ul><li>Search engines and news aggregators </li></ul><ul><ul><li>Moreover.com </li></ul></ul><ul><ul><li>Google.com </li></ul></ul><ul><ul><li>Ientry.com </li></ul></ul><ul><li>Newsletters </li></ul>
  38. 38. E-Communities <ul><li>E-communities </li></ul><ul><ul><li>Chat rooms </li></ul></ul><ul><ul><li>Bulletin boards </li></ul></ul><ul><ul><li>Personalized Web pages </li></ul></ul><ul><li>B2B are basically communities of transactions </li></ul><ul><ul><li>Classified ads </li></ul></ul><ul><ul><li>Job vacancies </li></ul></ul><ul><ul><li>Announcements </li></ul></ul><ul><ul><li>Industry news </li></ul></ul><ul><li>E-communities connect: </li></ul><ul><ul><li>Personnel </li></ul></ul><ul><ul><li>Partners </li></ul></ul><ul><ul><li>Customers </li></ul></ul><ul><ul><li>Any combination of these three </li></ul></ul><ul><li>Service providers </li></ul><ul><ul><li>Design of exchange portals </li></ul></ul><ul><ul><li>E-community service </li></ul></ul>
  39. 39. Partner Relationship Management (PRM) <ul><li>In B2B environment the partners include: </li></ul><ul><ul><li>Suppliers </li></ul></ul><ul><ul><li>Partners in joint ventures </li></ul></ul><ul><ul><li>Service providers </li></ul></ul><ul><li>PRM—relies on: </li></ul><ul><ul><li>Trust </li></ul></ul><ul><ul><li>Commitment </li></ul></ul><ul><ul><li>Quality of services </li></ul></ul><ul><ul><li>Continuity </li></ul></ul><ul><li>Strategy for e-service </li></ul><ul><ul><li>How much to invest in services </li></ul></ul><ul><ul><li>What services to provide </li></ul></ul>
  40. 40. Other B2B Services <ul><li>Trust services </li></ul><ul><li>Trust Trademark and domain names </li></ul><ul><li>Digital photos </li></ul><ul><li>Global business communities </li></ul><ul><li>Client matching </li></ul><ul><li>E-business rating sites </li></ul><ul><li>Promotion programs </li></ul><ul><li>Encryption sites </li></ul><ul><li>Web research services </li></ul><ul><li>Coupon-generating sites </li></ul>
  41. 41. Integration <ul><li>Integration in e-marketplaces and exchanges </li></ul><ul><ul><li>B2X hubs connect: </li></ul></ul><ul><ul><ul><li>All Internet business services </li></ul></ul></ul><ul><ul><ul><li>Merchant services </li></ul></ul></ul><ul><ul><ul><li>Exchange infrastructure </li></ul></ul></ul><ul><ul><ul><li>Buying and selling </li></ul></ul></ul><ul><ul><ul><li>Member enterprises </li></ul></ul></ul><ul><ul><ul><li>Other B2X exchanges </li></ul></ul></ul>
  42. 42. Hypermediation <ul><li>Hypermediators are: </li></ul><ul><ul><li>Content providers </li></ul></ul><ul><ul><li>Affiliate sites </li></ul></ul><ul><ul><li>Search engines </li></ul></ul><ul><ul><li>Portals </li></ul></ul><ul><ul><li>ISPs </li></ul></ul><ul><ul><li>Software makers </li></ul></ul><ul><ul><li>Other entities </li></ul></ul>Google
  43. 43. Managerial Issues <ul><li>Which services and to what level? </li></ul><ul><li>Complex decision situation for managers; use: </li></ul><ul><ul><li>Check out the competition </li></ul></ul><ul><ul><li>Vendors can provide useful direction </li></ul></ul><ul><ul><li>Read white papers etc. </li></ul></ul><ul><ul><li>Hire a reputable EC consultant </li></ul></ul><ul><li>Selecting service providers— </li></ul><ul><ul><li>Public ratings and rankings of service providers </li></ul></ul><ul><ul><li>Talk to others in the industry </li></ul></ul><ul><ul><li>Examine growth rate of provider’s business </li></ul></ul><ul><ul><li>Try vendor with small projects first </li></ul></ul>
  44. 44. Managerial Issues (cont.) <ul><li>E-infrastructure—large part of outsourcing funds go to e-infrastructure </li></ul><ul><li>Join ventures—look for potential partnerships with service providers </li></ul><ul><li>End-to-end outsourcing vs. best-of-breed </li></ul><ul><ul><li>Complete end-to-end service </li></ul></ul><ul><ul><li>Different vendors for best-of-breed approach </li></ul></ul>

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