MIS 300 Management Information Systems

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MIS 300 Management Information Systems

• E-Business

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Electronic Commerce
Buying, selling products, services and
information via computer networks, primarily the
Internet

• Business to Consumer
• Business to Business
• Intra-Business
• Government to Consumer and Business

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Some History

• Early 1970s Electronic Funds Transfer
• Mostly large corporations
• Electronic Data Interchange EDI
• Business transactions
• Wider range of industries
• 1990s Commercialization of the WWW

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Electronic Commerce

• Business-to-Consumer (B2C)
• Customers deal directly with organizations,
  avoiding intermediaries
• Business-to-Business (B2B)
• Participants are organizations
• More that 7.3 trillion volume predicted by 2004
• 15x volume of B2C

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• Founded in 1984 as retail computer software and
  hardware shop
• 250 stores at peak in 1992
• Retails sales margins plummeted as companies such
  as Microsoft dominated
• CompUSA and WalMart sized retailers hurt Egghead
• 10 year leases were coming up for renewal
• Egghead was still a strong brand name

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• Reinvented as web based virtual storefront
• Closing stores cost 37.6M and 80 of companies
  workforce
• Acquired Surplus Direct (web-based computer goods
  liquidator)
• Launched www.egghead.com in Fall 1997
• By July 1998, 7th most popular e-commerce site on
  web

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• Lost 39.6M in first fiscal year after web
• Stock price (EGGS on Nasdaq)
• 6.50 at announcement of web move
• 17.87 by July 30, 1998
• 10 1/8 on Oct 26, 1999
• Merger with Onsale in Nov 1999
• 7.56 on Mar 28, 2000
• 2.03 on Nov 9, 2000, 0.69 on Mar 22, 2001

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Egghead.com today
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Business to ConsumerE-Commerce on the Web

• Inform customer of your existence
• Provide in-depth product information
• Establish customer requirements
• Perform the purchase transaction and perhaps even
  the distribution
• Deliver electronic content
• Create online communities

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Electronic Content
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Product Information Online Community
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Customization and Transaction Processing
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Product Delivery
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Electronic Retailing

• Just about anything for sale www.cybermall.com
• Auction model eBay, Priceline
• Books, CDs, Computer HW/SW, Travel, Collectibles
• Borders, BN and Amazon
• Bolstered by consumer confidence in secure
  transactions
• Consumers just a click away from consuming
• Online catalogs
• How to use the web to advertise effectively?

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Other E-commerce Business Models

• Stock Trading
• ETrade new model
• Charles Schwab embrace and reposition
• Dean Witter Cover both sides (Discover)
• Merril Lynch Cautiously experiment
• Publishing
• Journals, newspapers, e-zines
• NY Times
• Banking
• Job market
• Real Estate

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Book Wars
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B2C Business is Tough
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Business to Business (B2B)E-Commerce

• Bring buyers sellers together
• Automate transactions
• Expand buyer choice
• Expand seller access
• Reduce transaction costs for all players

Kaplan, S. and M. Sawhney, E-Hubs The New B2B
Marketplaces, Harvard Business Review, May-June
2000
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Supply Chain ManagementMotivation for B2B
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Electronic Exchanges
So, who creates the Exchange?
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e-Hubs

• Supplier-oriented marketplace
• Disintermediate sell direct to business buyers
• Examples Dell, Intel, Cisco
• Similar to B2C counterpart
• Buyer-oriented marketplace
• Achieve efficiencies by inviting potential
  suppliers to bid on Request For Quotes (RFQ) in
  electronic marketplace.
• Streamline supply chain reduce transaction
  costs
• Intermediary-oriented marketplace (Hubs)
• Aggregate disparate buyers sellers in
  electronic marketplaces
• Create value for both buyers sellers
• Focus on industry verticals or business functions

By Paragi Shah from
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Online Auctions

• Mechanism for bringing buyers and sellers
  together
• Sellers seek buyers from a broad spectrum of
  potential buyers.
• Increases revenues by introducing products and
  services to anyone that has access to the online
  auction.
• Introduces price competition among buyers.
• Reduces time and money needed to solicit and
  manage bids.

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Financial Investment Web Sites

• Finding and online broker
• http//www.ameritrade.com/
• http//www.datek.com/
• http//www.fidelity.com/

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G-C and G-B

• Government is important domain for e-commerce
• http//www.michigan.gov/ - national awards
• The killer app (not quite) in Startup.com, the
  movie
• GovWorks.com
• ams.com
• ezgov.com

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Key Technical Components
Leased phone lines, DSL, etc.
Websphere, Commerce Server 2000 CommerceOne
Apache (a patchy), IIS, web site creation and
management
Windows, Unix, Linux
Big beefy computers with lots of memory and
storage
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E-Commerce Technology Components

• Hardware
• host in house or outsource? (http//www.tophosts.c
  om/)
• Web Server Software
• Web Page Construction Software e.g.
  Dreamweaver, Frontpage, ColdFusion, many more
• Site management
• E-commerce Software www.commerceone.com
• Catalog Management
• Product Configuration
• Shopping Cart
• E-commerce Transaction Processing
• security, authorization, financial transactions
• Web Site Data Analysis Web Analytics

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Technology Components (Cont.)

• Network and Packet Switching
• Electronic Payment Systems
• Digital certificate
• Electronic cash
• Electronic wallet
• Smart, Credit, Charge, and Debit Cards
• Electronic shopping carts

www.digicash.com www.ecash.com
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Strategies for Successful E-Commerce

• Developing an effective Web presence
• Putting up a Web site
• Web Site Hosting Services www.valueweb.com
• Storefront Brokers www.bigstep.com
• Building Traffic to your Web Site

Umm, perhaps this is not quite enough...
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Achieving Web Presence Goals

• Attract visitors to the web site
• Make the site interesting so that visitors stay
  and explore it (stickiness)
• Encourage visitors to follow the sites links to
  obtain information
• Create an impression consistent with the
  organizations desired image
• Reinforce the positive images of the organization
  the visitors might already have

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How the Web is Different?

• In traditional design,
• You control every pixel on the screen
• Know the system you are designing for
• Know what fonts are installed
• Know how large the screen typically will be, and
• Have the vendors style guide to tell you the
  rules
• In web design,
• You share control with users
• Pages are viewed with computers, WebTV, hand-held
  devices, cell phones, etc.

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How the Web is Different?

• In traditional design,
• The designer controls where the user can go and
  when
• A traditional application is an enclosed user
  interface experience
• The user typically works with an application for
  a considerable amount of time
• On the web,
• the user controls ones navigation
• One can rapidly move among sites
• Users stay on a site one minute or less unless
  one has a reason to be there

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Creating Flexible Web Site Interfaces

• Interface is the view seen by visitors
• Layout, colors, hyperlinks, images, and controls
• Different versions with frames, text-only
• Provide thumbnails, streaming video clips
• Allow to choose level of details, item selection
  or grouping, viewing format, downloading format
• So, lets create some web sites...