What is ecommerce and ebusiness

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What is e-commerce and e-business?

• Alan Jones
• Director
• IT Response Unit

2
Who are we?

• University-based technology transfer for
• e-business and
• e-commerce
• Funded by ERDF and GO-NE
• Targetted to deliver substantial assistance
• Targetted to produce business change
• Tasked to raise 10K as evidence of effort

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Retailing and business

• E-business is so-called B2B
• business to business
• estimated 80 of e-trade by 2002
• E-commerce is so-called B2C
• business to consumer/customer
• estimated 20 of e-trade by 2002
• also called e-tailing (cf. Retailing)

4
e-business is..

• a set of high-level concepts
• a technology infrastructure
• an implementation schedule
• a people business
• the Millennium opportunity

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e-business concepts

• Network
• open, redundant, cheap
• Growth of revenue
• 5Bn UK, 45Bn Europe, 200Bn US by 2001
• Business opportunities B2B 80, B2C 20
• outsourcing, manufacturing, supply-chain
  stretching, NOT e-tailing (big boys only)
• Death to agents
• information traders must change or die

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e-business network

• Millions, redundantly connected
• Geography is redefined
• EDI is replaced/overtaken
• Security is re-invented - firewall, intrusion
  detection systems

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how many millions at what rate??
First Aid for e-Trade with teaching and learning
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how many millions in UK??

• Britain is expected by 2002 to become the first
  European country where half of all homes have a
  computer. Forrester Research
• BT has announced new unmetered pricing structures
  for internet access, offering unlimited access
  for flat-rate fees
• Libraries are poised for a new "golden age"
  thanks to widespread adoption of internet
  technology, according to the head of the British
  Library

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Millions and billions

• online commerce (Nov. 1998) online retail
  sales (Oct. 1999)

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geography is redefined

• Vox Pop says the Internet kills geography
• but geography is not redundant
• business opportunity assurance is
• use the Internet for reaching up the supply chain
• keep your business to physical assets to secure
  your customers from other e-traders

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EDI is replaced/overtaken
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• e-commerce is not new
• Electronic Document Interchange
• rigidly formatted, paper-based protocol
• Trust, integrity, authentication (of origin, of
  receipt)
• Non-repudiation binds the contract
• EDI will inter-operate with the Internet

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Security is re-invented
First Aid for e-Trade with teaching and learning

• servers are sold as lock-up-able boxes, but
• viruses, hackers, bugs come in the night
• firewall
• intruder detection systems
• for footprints read hits
• need flexible capacity and bandwidth
• for respect read transaction integrity, privacy
  and non-repudiation

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Revenue growthfor e-trade

• Projection-1
• 1998 32Bn 65 business 35 home
• 2002 425Bn 78 business 22 home
• Projection-2 for year 2001
• Europe 64Bn e-revenue 0.9 GDP
• US 206.8Bn e-revenue 2.7 GDP
• FT 1999 Jan 13

First Aid for e-Trade with teaching and learning
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Business opportunities
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• To move or not to move - up or down the supply
  chain?
• Down means trashing your terms and conditions
• Up means taking on some business of your supplier
• Use the information supply chain but dont trade
  information

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Death to agents
First Aid for e-Trade with teaching and learning

• Agents retail information
• travel, booking, ticket, betting, stock,
  catalogue, etc. - all pure information businesses
• Information is cheaper on the net, open all
  hours, and theres more choice
• Become a user-chooser-advisor and stay in business

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e-business technology infrastructure

• Intranets
• Internet
• Extranets
• ERP Enterprise Resource Planning
• SCM Supply Chain Management
• CRM Customer Relationship Management

First Aid for e-Trade with teaching and learning
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Intranets
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• Networks joining computers within a business
  zone/building/area
• thin client is name for stripped-down PC that
  expects to spend its life on an intranet
• server is name for a heavy-weight PC that acts
  as database and applications engine/repository
  for a network.

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Internet
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• Explosive growth in redundant pathways joining
  computers
• derived from work by US military during cold war
  to create a C3 system (command, control and
  communications) to survive a nuclear blast
• rocketed to popular access by Mosaic, an early
  browser, and low cost/high content

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Extranet
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• e-business enablers that permit access from one
  intranet (the customer) to another (the supplier)
  with security and safety via the open, unsafe and
  insecure Internet
• infrastructure that new Digital Signatures, SSL
  (secure sockets layer) etc. make secure
• infrastructure exploited by DCOM and CORBA
  architectures to promote distributed
  communication between computers

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e-Business
S C M
E R P
C R M
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Enterprise Resource Planning

• Tools
• Intranet of database(s)
• electronic collaboration (Lotus Notes, MS
  Outlook)
• Resources
• business reorganised around Internet protocols
• Effect
• left hand talks to right hand
• Impact
• Browser can talk to left hand and right hand

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Supply Chain Management

• Tools
• Internet and intelligent browser
• Resources
• wired, collaborative intranet for electronic
  sales-order processing, purchasing, invoicing
• shopping basket deal with ISP and credit agent
• Effect
• creates extranets for you, suppliers and
  customers
• Impact
• liaison is tight, relations are responsive

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Customer Relationship Management

• Tools
• Internet and intelligent browser
• Resources
• wired, collaborative intranet
• electronic sales-order processing, purchasing,
  invoicing
• Effect
• accurate invoicing and delivery, anticipate
  demand, track periodic change
• Impact
• full analysis of customer behaviour

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e-business implementation schedule

• Gerstner of IBM calls dot.com companies fireflies
  before the storm
• IBM is in strategic alliance with Dell to acquire
  Dells lean-inventory build-to-order
• Ford and GM will move their entire purchasing
  supply-chains to the Internet by summer 2000
• Tony Blair says embrace the Netor die

First Aid for e-Trade with teaching and learning
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Digital Signatures in e-commerce bill planned for
Royal Assent by Spring 2000
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• Authentication of the sender
• Integrity of the message
• Non-repudiation of the sender

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PUBLIC KEY ENCRYPTION
Sender
Authentication of
Confidentiality to Receiver
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DIGITAL SIGNATURE
Sender
Receiver
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Digital Certificate
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• Binds the public key
• of the person-company-device
• to the corresponding identity
• verified by the Certification Authority
• this is the X.509 standard

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Applications of Certificates
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• Secure E-mail - private messages
• Secure Web-access - secure credit details and
  non-repudiation
• Secure Extranet - strategic and confidential
  alliances
• Secure workflow - assured instructions
• Secure program download - applications to rent
  and just-for-now thin clients

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The futures not what it used to be

• Microprocessor market penetration will be far in
  excess of 150
• Fridges, cars, telephones, smart-TVs, etc.
• Manufacturing as bulk-for-low-costs will be
  replaced by customised-for-each-order without any
  loss of momentum or profit.
• Internet-ready games and telephones - products -
  are NOW on sale

First Aid for e-Trade with teaching and learning
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The factory of the future

• Has only one man and one dog
• the man is there to feed the dog
• the dog is there to stop the man interfering with
  the machines.

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The Information Age

• Agrarian, can circle the earth in 3-5 yrs
• Industrial, can do it in 0.3-0.5 months
• Post-industrial, can do it in 0.03-0.05 days
• Info, can do it in 0.003-0.005 hours

First Aid for e-Trade with teaching and learning
33
The weightless economy

• US stock market valuation is ten-times inventory
  and asset (comparing 1900 with 1998) Alan
  Greenspan, Fed Res Board
• UK stock market valuation is four-times inventory
  and asset The Economist
• This is the price of the knowledge economy

First Aid for e-Trade with teaching and learning
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The Cobblers Shop c. 1950
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• YOU CAN HAVE IT
• FAST
• RIGHT
• CHEAP
• PICK ANY TWO!

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The Cobblers Shop in the Information Age

• You will get
• fast-right-AND-cheap
• but its only be the first step of what you want

First Aid for e-Trade with teaching and learning