1. Chapter 17
Using Technology
in a Competitive Environment

2. Objectives of Chapter 17:
Understand the key role of technology as it affects a company’s strategy.
Describe how information can be provided using information technology.
Explain the concept of e-commerce.
Discuss the use of the Web for business-to-consumer marketing.
Explain how business-to-business relationships work.
Understand how technology can make a company more efficient.
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3. The Strategic Use of Information Technology
Dell uses an almost total internet
strategy to market their products.
Southwest Airlines uses the internet
extensively for on-line reservations.
Best Buy uses the internet for marketing products
which are primarily found in their traditional retail stores.
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4. Why Buy Consumer Electronics in a Store?
Eliminate shipping and handling costs 35.5%
See product demonstration first
Returns less of a hassle
Shorter time before getting product
Check out quality
Speak with salesperson
Price lower in store
Eliminate using credit card on internet 14.4
Pay by cash or check
Photo on web not sufficient
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5. Providing Information on the Web
Virtually every public company and thousands of privately held companies now have company websites.
These websites provide information:
Annual reports
Company history
FAQs
Advertisements about their product lines
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6. Electronic Commerce Electronic Commerce (E-commerce):
The buying or selling of products on the Web.
Consumer-to-Consumer Commerce:
The selling of a product by one consumer to another typically through an intermediary called a hub.
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7. Consumer-to-Consumer E-Commerce
Hub (or electronic market) S B S B S B
Information
Cash
Products
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8. Business to Consumer Business-to-Consumer E-commerce (B2C or BtoC):
Selling by a business to a consumer on the internet; also called electronic retailing, e-tailing or e-retailing.
Online Retailer
Bank or
Credit Card
Buyer
Buyer
Buyer
Orders &
Cash
Products
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9. Business-to-Business
Business-to-Business (B to B) E-commerce:
The uses of the Internet to conduct transactions between businesses.
Two Types of B2B Relationships:
Direct link transactions between two businesses. Typically, these are supplier-manufacturer links or manufacturer-retail links.
Through the use of a hub, vortex, electronic market, or net marketmaker.
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10. Business-to-Business
Direct Business-to-Business E-commerce:
Interaction between two companies primarily through computer contact.
Extranet:
A private website accessible only by a company and its partners.
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11. Direct Business-to-Business Relationships
Products
Seller (supplier)
Buyer
Order
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12. Hub-Based Business-to-Business E-Commerce
Electronic hub or net market makers:
The intermediary in business-to-business e-commerce
Hub-based B2B is expected to grow significantly as companies find ways to reduce their costs of inputs and increase efficiency.
Prediction:
Expenditures on B2B net market maker infrastructure (equipment and software) will increase from $2.1 billion in 2000 to $80.9 in 2005.
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13. Hub-Based Business-to-Business E-Commerce
Supplier
Supplier
Supplier
Hub or Electronic Market
Buyer
Buyer
Buyer
Buyer
Order
Shipment
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14. Using Technology to Enhance Internal Operations
Intranet:
A computer communications network within a single company.
Intranets:
Solve many company communication problems.
Allows communication even if different kinds of computers are used.
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15. Using Technology to Enhance Internal Operations
Companies are finding that databases can be accessed by users across the company, thereby substantially reducing the need for paper while providing the opportunity for continuous updating of information.
Intranets are secure from outsiders and insiders who should not have access to confidential information.
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16. The Impact of Technology on Internal Operations
Just-in-Time (JIT) Production
Flexible Manufacturing:
Manufacturing with highly automated machinery that can be changed quickly and can perform multiple tasks.
Enterprise Resource Planning (ERP):
A company wide application software that provides a centralized repository of information.
Mass Customization:
The design of products and processes in order to deliver highly customized products to different customers around the world.
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17. The Impact of Technology on Internal Operations
Computer Integrated Manufacturing:
Numerically controlled machines
Robots
Computer Aided Design (CAD)
Computer Integrated Manufacturing
Enterprise Resource Planning (ERP):
Integrates all departments and functions across a company onto a single computer system.
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