1. PowerPoint Presentation by Charlie Cook Copyright © 2004 South-Western. All rights reserved. Chapter 4 E-BusinessE-Business

2. Copyright © 2004 South-Western. All rights reserved.4–2 Learning Objectives To describe and analyze the major approaches used to transfer electronic data during business event data processing To explain the complexities that are introduced as electronic document management moves us steadily toward the paperless office To evaluate the complexities surrounding electronic data interchange that are introduced when linking two different organizations’ computer systems for joint business event data processing

3. Copyright © 2004 South-Western. All rights reserved.4–3 Learning Objectives (cont’d) To explain the challenges faced by organizations when they pursue direct business links with customers via the Internet To be able to use business advantages gained through effective facilitation of e-business

4. Copyright © 2004 South-Western. All rights reserved.4–4 Electronic Business Involvement of two or more individuals and/or organizations in completion of electronic business transactions. Byproducts:  Elimination of sales staff as intermediary between two parties to transactions.  Transactions completed more quickly, more efficiently, and more effectively.

5. Copyright © 2004 South-Western. All rights reserved.4–5 Batch Processing Business event occurs Record business event data Update master data Generate outputs

6. Copyright © 2004 South-Western. All rights reserved.4–6 Automated Equivalent to a Manual System FIGURE 4.1

7. Copyright © 2004 South-Western. All rights reserved.4–7 Online Transaction Entry (Batch Processing Environment) FIGURE 4.2

8. Copyright © 2004 South-Western. All rights reserved.4–8 Online Real-Time (OLRT) Processing Business event occurrence/recording in event data files Update master data Generate reports in support of queries

9. Copyright © 2004 South-Western. All rights reserved.4–9 Online Real-Time Processing FIGURE 4.3

10. Copyright © 2004 South-Western. All rights reserved.4–10 Online Transaction (OLTP) Processing A real-time (RT) system that performs all or part of processing at data terminal location.  Updating of master data may be immediate or delayed.  Can have memorandum update in RT and full batch update at night (referred to as a “remote batch”).

11. Copyright © 2004 South-Western. All rights reserved.4–11 Alternative Approaches to Real-Time Processing FIGURE 4.4

12. Copyright © 2004 South-Western. All rights reserved.4–12 Advances in Electronic Processing and Communication Automated Data Entry  Bar code readers  Optical character recognition (OCR)  Scanners Digital Image Processing Communication Networks  Local area networks (LANs)  Wide area networks (WANs)  Internet

13. Copyright © 2004 South-Western. All rights reserved.4–13 Stages in E-Business Electronic Document Management (EDM) Electronic Document Interchange (EDI) E-Commerce (Internet)

14. Copyright © 2004 South-Western. All rights reserved.4–14 Electronic Document Management (EDM) Document storage and retrieval Business event data processing Benefits of EDM  Reduced cost of handling and storing paper  Improved staff productivity  Wider use of geographically distributed virtual teams  Superior customer service  Enhanced management of operational workflow  Faster processing

15. Copyright © 2004 South-Western. All rights reserved.4–15 Electronic Data Interchange (EDI) Computer-to-computer exchange of business data in standardized formats.  Application software  Translation software  Communications network Value-added network (VAN) service  Private network service provider of communications

16. Copyright © 2004 South-Western. All rights reserved.4–16 E-Commerce The Internet  Dominant platform for e-business  B2C and B2B  Internet auctions and market exchanges  XML (eXtensible Markup Language) supplanting EDI  Benefits of Internet commerce  Survival in today’s market  Customer responsiveness  Global market penetration  Reduced costs and improved accuracy  Rethinking and redesign of processes and controls

17. Copyright © 2004 South-Western. All rights reserved.4–17 Electronic Data Interchange Transaction Set FIGURE 4.5

18. Copyright © 2004 South-Western. All rights reserved.4–18 Electronic Data Interchange Transaction Set FIGURE 4.6 Source: Adapted with permission from A. Faye Borthick and Harold P. Roth, "EDI for Reengineering Business Processes," Management Accounting (October 1993): 35–36. NOTES: The asterisk (*) character designates a field separator. Consecutive field separators (***) signify omitted data. N/L denotes a new line (e.g., a carriage return).

19. Copyright © 2004 South-Western. All rights reserved.4–19 Typical Electronic Communications Connection for e-commerce FIGURE 4.7