10. THE INTERNET: ELECTRONIC COMMERCE & ELECTRONIC BUSINESS 10.1

LEARNING OBJECTIVES DESCRIBE INTERNET, ITS CAPABILITIES IDENTIFY INTERNET BENEFITS TO ORGANIZATIONS DEMONSTRATE HOW INTERNET USED FOR ELECTRONIC COMMERCE * 10.2

LEARNING OBJECTIVES DEMONSTRATE HOW INTERNET TECHNOLOGY USED FOR INTRA- AND INTERORGANIZATIONAL ELECTRONIC BUSINESS EXAMINE CHALLENGES OF INTERNET TO BUSINESS & SOCIETY * 10.3

MANAGEMENT CHALLENGES THE INTERNET INTERNET & ELECTRONIC COMMERCE INTRANETS & ELECTRONIC BUSINESS CHALLENGES & OPPORTUNITIES * 10.4

THE INTERNET BEGAN AS GOVERNMENT CONNECTION OF UNIVERSITIES INTERNET SERVICE PROVIDER (ISP): organization connected to Internet, leases temporary connections to subscribers NO ONE OWNS IT, NO FORMAL ORGANIZATION * 10.5

INTERNET CAPABILITIES E -MAIL: person -to-person messaging; document sharing USERNET NEWSGROUPS: electronic bulletin boards for discussion groups LISTSERVs: e-mail list servers for discussion groups CHATTING: interactive conversations TELNET: log on one computer, work on another FTP: transfer files from computer to computer GOPHERS: use menus to locate text material * 10.6

INTERNET ADDRESS http://www.prenhall.com/laudon PROTOCOL FOR THE WEB HOST COMPUTER DIRECTORY EXTENSION DOMAIN NAME 10.7

INTERNET TERMS HOME PAGE: WWW screen display welcomes user to organization’s page WEBMASTER: person in charge of Web site UNIFORM RESOURCE LOCATOR (URL): address of specific Internet resource * 10.8

INTERNET TERMS HYPERTEXT TRANSPORT PROTOCOL (http): communications standard used to transfer Web pages HYPERTEXT MARKUP LANGUAGE (HTML): popular programming language for creating Web sites * 10.9

SURFING THE NET SEARCH ENGINE: tool for locating specific sites or information on WWW PORTAL: point of entry to WWW “PUSH” TECHNOLOGY: server streams relevant content to browser MULTICASTING: sending data to select group * 10.10

INTRANET INTERNAL NETWORK WWW TECHNOLOGY FIREWALL: Security System to Prevent Invasion of Private Networks OVERCOMES COMPUTER PLATFORM DIFFERENCES OFTEN INSTALLED ON EXISTING NETWORK INFRASTRUCTURE * 10.11

ALLOWS SELECT USERS OUTSIDE ORGANIZATION TO USE ITS INTRANET: EXTRANET ALLOWS SELECT USERS OUTSIDE ORGANIZATION TO USE ITS INTRANET: CUSTOMERS BUSINESS PARTNERS VENDORS * 10.12

EXTRANET 10.13

INTERNET BENEFITS GLOBAL CONNECTIVITY REDUCED COMMUNICATIONS COST LOWER TRANSACTION COSTS REDUCED AGENCY COSTS INTERACTIVITY, FLEXIBILITY, CUSTOMIZATION ACCELERATED KNOWLEDGE * 10.14

INTERNET & ELECTRONIC COMMERCE EASY TO LINK WITH OTHER BUSINESSES, CUSTOMERS CAN UPDATE PRODUCT INFORMATION, ORDERING, CUSTOMER SUPPORT ON-LINE STOREFRONTS ENHANCED BUSINESS FORMS * 10.15

INTERNET & ELECTRONIC COMMERCE CUSTOMER-CENTERED RETAILING DISINTERMEDIATION: removal of intermediate layers streamlines process REDUCED COST TO BUYER, SELLER HIT: each request for a file recorded in log file * 10.16

INTERNET BUSINESS MODELS VIRTUAL STOREFRONT: sells goods, services on-line MARKETPLACE CONCENTRATOR: concentrates information from several providers INFORMATION BROKER: provides product, pricing, availability information * 10.17

INTERNET BUSINESS MODELS TRANSACTION BROKER: buyers view rates, terms from various sources ELECTRONIC CLEARINGHOUSE: auction-like setting, products, prices, change in response to demand REVERSE AUCTION: buyer sets price, submits to multiple sellers * 10.18

INTERNET BUSINESS MODELS DIGITAL PRODUCT DELIVERY: sell, download software, other digital products CONTENT PROVIDER: creates revenue through providing client for a fee, and advertising ON-LINE SERVICE PROVIDER: provides service, support for hardware, software products * 10.19

ELECTRONIC COMMERCE SUPPORT SYSTEMS WEB HOSTING SERVICES: provides large servers for Web sites of fee-paying customer ELECTRONIC PAYMENT SYSTEM: using Web for electronic funds transfers, credit , smart & debit cards * 10.20

INTRANETS AND ELECTRONIC BUSINESS ELECTRONIC COMMERCE SERVERS BENEFITS GROUP COLLABORATION FUNCTIONAL APPLICATIONS SUPPLY CHAIN MANAGEMENT * 10.21

ELECTRONIC COMMERCE SERVERS: ICAT: on-line catalog shopping, order placement (Icat) NET.COMMERCE: merchant server supporting Secure Electronic Transactions protocol (IBM) MerchantXpert:: search tools, order management, tax, payment, logistics modules (Netscape) * 10.22

ELECTRONIC COMMERCE SERVICES: OPEN MARKET TRANSACT: customer authentication, order & payment processing, tax, multi-language customer service (Open Market) INTERNET COMMERCE SERVER: integrates orders, inventory, customer service, payments (Oracle) * 10.23

BENEFITS OF INTRANETS: CONNECTIVITY CAN BE TIED TO LEGACY SYSTEM & TRANSACTION PROCESSING INTERACTIVE APPLICATIONS WITH TEXT, AUDIO, VIDEO SCALABLE TO LARGER OR SMALLER SYSTEMS AS REQUIRED * 10.24

BENEFITS OF INTRANETS: EASY TO USE BROWSER INTERFACE LOW START-UP COSTS RICH, RESPONSIVE INFORMATION ENVIRONMENT REDUCED INFORMATION DISTRIBUTION COSTS * 10.25

GROUP COLLABORATION: TEAMWARE: intranet-based applications allow teams to share ideas, documents, brainstorming, scheduling. Similar to chat room. INTERNAL NEWSLETTER ABILITY TO WORK AT HOME SHARE INTERNET DISCOVERIES WITH COLLEAGUES * 10.26

FUNCTIONAL APPLICATIONS: FINANCE & ACCOUNTING HUMAN RESOURCES SALES & MARKETING MANUFACTURING & PRODUCTION * 10.27

GENERAL LEDGER REPORTING PROJECT COSTING ANNUAL REPORTS BUDGETING * FINANCE & ACCOUNTING: GENERAL LEDGER REPORTING PROJECT COSTING ANNUAL REPORTS BUDGETING * 10.28

EMPLOYEE SAVINGS PLANS BENEFITS ENROLLMENT ON-LINE TRAINING HUMAN RESOURCES: CORPORATE POLICIES EMPLOYEE SAVINGS PLANS BENEFITS ENROLLMENT ON-LINE TRAINING JOB POSTING * 10.29

PROMOTIONAL CAMPAIGNS SALES PRESENTATIONS SALES CONTRACTS * SALES & MARKETING: COMPETITOR ANALYSIS PRICE UPDATES PROMOTIONAL CAMPAIGNS SALES PRESENTATIONS SALES CONTRACTS * 10.30

MANUFACTURING & PRODUCTION: QUALITY MEASUREMENTS MAINTENANCE SCHEDULES DESIGN SPECIFICATIONS MACHINE OUTPUT ORDER TRACKING * 10.31

SUPPLY-CHAIN MANAGEMENT 10.32

CHALLENGES & OPPORTUNITIES UNPROVEN BUSINESS MODELS BUSINESS PROCESS CHANGE REQUIREMENTS CHANNEL CONFLICTS TECHNOLOGY HURDLES LEGAL ISSUES SECURITY & PRIVACY * 10.33

Connect to the INTERNET PRESS LEFT MOUSE BUTTON ON ICON TO CONNECT TO THE LAUDON & LAUDON WEB SITE FOR MORE INFORMATION ON THIS CHAPTER 10.34

10. THE INTERNET: ELECTRONIC COMMERCE & ELECTRONIC BUSINESS 10.35