1. Today’s Strategic Imperative: E-Business Annika Burton Matt Richardson Shantell Howard

2. Introduction In the 1990’s, the internet set off a revolution in the use of IT to do business.  The cost structure and geographic limits of networked systems became possible to build systems with world wide reach quickly and inexpensively

3. “ Strategic use “ IT as “ having a significant, long term impact on a firm’s growth rate, industry, and revenue  1. IT today not only improves internal processes and structure of a firm, but it also improves a firm’s products, services, and relationships with its customers, to improving its processes and relationships with its business partners.  2. The stages of this evolution has three roles:  Looking inward: To improve process and structure  Looking outward: Incorporated in products and services  Looking across: Linking to other organizations

4. IT has been used to improve business process and change organizational structure Examples of inward-looking strategic uses of IT include business process reengineering and ERP systems Examples of outward looking strategic uses of IT include packing tracking systems for delivery companies and reservation systems used by airlines, hotels, and rental car companies The use of such systems and cross-industry reservation systems, include electronic data interchange (EDI) systems and cross-industry reservation systems

5. E-business is defined as the telecommunication networks, particularly the Internet, to conduct business transactions  Three categories: Business to employee: Intranet-based applications internal to a firm Business to consumer: Internet-based applications for a firm’s customers Business to business: Extranet-based applications for a firm’s business partners

6. Looking Inward: Business to Employee Intranets have disadvantages:  Determining how to integrate legacy systems into the intranet  How much control of the system should be decentralized  Proprietary interfaces on those legacy systems make it difficult to integrate them into an intranet Solution: Create a corporate portal to act as the gateway to the firm’s internal resources, information, and Internet services. This solution brings access to company data and applications together in a single site

7. Looking Outward Business-to-Consumer Business-to-Business Internet-Based EDI

8. Business-to-Consumer B2C is the most widely reported form of e-business. Advantages  Global Accessibility - Internet eliminates geographic boundaries.  Reduced order processing - automated order processing improves efficiency.  Greater availability  Closer customer relationships - with a direct link to customers, the company can quickly address concerns and customize responses

9. Business-to-Consumer  Increased customer loyalty - with improved customer service and personalized attention comes greater customer loyalty  New Products and services- with direct links to customers, the company can provide information-based products and services.  Direct Marketing- Manufacturers can bypass retailers and distributors, selling directly to customers.

10. Business-to-Consumer Potential Problems  Technical: information systems are not always reliable  Logistics: shipping products around the world leads to “physical” barriers to the virtual business  Personnel: lack of experience in the new environment

11. Business-to-Consumer Potential Problems  Legal: business across geographical boundaries means multiple legal systems to deal with  Competitive response: ease of creating a Web presence brings low barriers to entry for competitors  Transparent prices: customers can easily compare prices across Web sites.  Greater competition

12. Business-to-Business EDI is the transmission of data for business transactions between computers of independent organizations.  Created to replace paper  Today: protocols are met to comply with each organization to transmit any type of information.

13. Internet-Based EDI Traditional  Private Networks  High setup cost  Specific groups  Secure networks  Value-added services Internet  Public networks  Low setup cost  Large group  Less secure network  Limited services

14. Evolution of the Internet: Quality of Service; refers to the ability of a network to provide a range of assured levels of performance  Next Generation Internet (NGI) Three Components:  Research and development on advanced network technologies  The development of high-speed testbed networks  The development and demonstration of revolutionary applications that demand high speed networks not currently possible on today's Internet.  University Consortium for Advanced Internet Development (UCAID) Sponsors two related projects:  The Internet 2 will link more than 100 member universities with an advanced academics network; support research, which requires applications that cannot be run over the current Internet.  Abilene is seen as a second Internet 2 backbone Technical Considerations

15. Security: ranks as one of the top management and consumer concerns about e-business.  Three Categories, security concerns: Sniffing: the interception and reading of electronic messages as they travel over the communications networks Spoofing: the assumption of a false identity and the communication of fraudulent transactions Hacking: the unauthorized access to a host computer  Protections against three concerns A firewall: hacking Encryption: sniffing Authentications: spoofing

16. Legal and Ethical Considerations Legal and ethical issues of which management must be aware of:  Privacy; freedom from intrusion, the right to be left alone, the right to control information about oneself, and freedom from surveillance.  Intellectual property rights Copyrights Patents Trademarks Trade secrets  Legal jurisdiction  Content regulations

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