Information Management - Lecture 2 - E-Business, E-Commerce, The Cloud and Business Intelligence
Introduction to e-Business and e-Commerce
E-Business: Utilizing web technology to improve various aspects of a business.
Improve business processes: Streamlining operations for efficiency.
Example: Automating invoice processing to reduce manual effort and errors.
Enhance communication: Improving interactions with partners, suppliers, vendors, and customers.
Example: Using a CRM system to manage customer interactions and feedback.
Perform business transactions securely: Ensuring secure online transactions.
Example: Implementing encryption protocols to protect customer payment data.
Potential areas:
Production process: Managing procurement, ordering stock, payment, and supplier communication.
Example: Using an online portal for suppliers to submit bids and track orders.
Customer-focused processes: Enhancing marketing, selling, customer support, order, and payment processing.
Example: Implementing a chatbot on an e-commerce site to provide instant customer support.
Internal management processes: Improving training, recruitment, and employee services.
Example: Using an online learning platform to train employees on new software.
E-Commerce Definition: Any exchange of information or business transaction facilitated by the use of information and communication technologies.
Extends beyond home computer users: Involves various entities beyond individual consumers.
Example: Businesses using EDI (Electronic Data Interchange) for transactions.
Primarily involves companies and public authorities: Focuses on transactions between organizations.
Example: Government agencies using online portals for procurement.
Encompasses a vast variety of systems: Includes diverse platforms and tools.
Example: Mobile commerce, social commerce, and IoT-based commerce.
Types of E-commerce Activities
B2B: Transactions between businesses.
Example: A manufacturer purchasing raw materials from a supplier through an online marketplace.
B2C: Companies selling to customers.
Example: An online retailer selling clothes directly to consumers.
B2G: Transactions between businesses and public sector organizations.
Example: A construction company bidding for a government infrastructure project through an online portal.
C2C: Transactions between private individuals.
Example: Selling used goods on eBay or Craigslist.
E-Commerce Systems
E-shops and e-malls: Online retail platforms.
Example: Amazon, Shopify stores.
E-procurement: Online purchasing systems for businesses.
Example: SAP Ariba, Coupa.
E-auctions: Online auction platforms.
Example: eBay, online government auctions.
Content providers: Deliver information online.
Example: Netflix (streaming movies), news websites.
Market segmenters and infrastructure providers: Support e-commerce operations.
Example: Payment gateways (PayPal), web hosting services (AWS).
Specialist service providers: Offer specific e-commerce-related services.
Example: SEO agencies, e-commerce consultants.
Drivers for Using the Internet for Business
Cost reduction: Lower operational expenses.
Example: Reduced printing and mailing costs by using email for communications.
Flexibility: Ability to adapt quickly to changing market conditions.
Example: Easily updating product catalogs and pricing on an e-commerce site.
Protecting investment: Ensuring long-term viability.
Example: Cloud-based solutions that scale with business growth.
Connectivity: Enhanced communication with stakeholders.
Example: Using video conferencing tools for remote meetings.
Low risk: Reduced initial capital expenditure.
Example: Using SaaS applications instead of purchasing on-premise software.
Improved customer service: Providing better support and engagement.
Example: 24/7 customer support through chatbots.
Globalization: Expanding market reach internationally.
Example: Selling products to customers worldwide through an e-commerce platform.
Relationship between E-commerce and E-business
E-business encompasses a broader range of activities than e-commerce: Includes all aspects of running a business online.
Example: E-business includes supply chain management, customer relationship management, and enterprise resource planning.
E-commerce is divided into buy-side and sell-side activities.
Buy-side e-commerce focuses on procurement from suppliers.
Example: Using e-procurement systems to automate the purchasing process.
Sell-side e-commerce involves sales to customers.
Example: Selling products through an online store.
E-business includes internal organizational processes and functional units.
Example: Human resources using online portals for employee benefits management.
Benefits of E-business and E-Commerce
Tangible Benefits:
Increased sales: Generating new leads, markets, repeat customers, and cross-selling.
Example: Targeted email marketing campaigns leading to higher conversion rates.
Marketing cost reductions: Reducing customer service time, online sales, and lower printing/distribution costs.
Example: Switching from traditional advertising to online advertising.
Supply-chain efficiencies: Reducing inventory, increased supplier competition, and shorter order cycle times.
Example: Implementing just-in-time inventory management.
Administrative cost reductions: Streamlining processes like recruitment and invoice payment.
Example: Using online payroll systems.
Intangible Benefits:
Enhanced corporate image and brand: Building a positive online reputation.
Example: Active social media presence and positive customer reviews.
Rapid marketing communications & PR: Quickly disseminating information.
Example: Announcing new product launches through email and social media.
Faster product development lifecycle: Responding quickly to market needs.
Example: Gathering customer feedback through online surveys and using it to improve products.
Improved customer service: Providing better online support.
Example: Offering live chat and personalized recommendations.
Learning for the future: Staying ahead of technological advancements.
Example: Investing in training for employees on new e-commerce technologies.
Meeting customer expectations: Having a strong online presence.
Example: Ensuring a user-friendly and mobile-responsive website.
Identifying and supporting partners better: Strengthening relationships.
Example: Using online portals for partner communication and collaboration.
Improved management of marketing and customer information: Leveraging data analytics.
Example: Tracking customer behavior on the website to personalize marketing efforts.
Customer feedback on products: Gathering insights for product improvement.
Example: Collecting and analyzing customer reviews on product pages.
The Cloud
What is Cloud Computing?
Services and solutions delivered or consumed in real-time over the Internet.
Example: Accessing Google Docs from any device with an internet connection.
A delivery model of computing services.
Example: Infrastructure as a Service (IaaS), Platform as a Service (PaaS), and Software as a Service (SaaS).
Enables real-time development, deployment, and delivery of a broad range of products and services.
Example: Developing and deploying a web application using AWS.
Why is the Cloud important?
Increasingly important in the technology landscape: Driving innovation and efficiency.
Example: Businesses migrating their IT infrastructure to the cloud to reduce costs and improve scalability.
Considered a top technology trend: Shaping the future of IT.
Example: More companies adopting cloud-first strategies.
Changes how businesses operate: Enabling new business models and opportunities.
Example: Remote work becoming more feasible with cloud-based collaboration tools.
Impact of Cloud for Business
Established companies: IBM, Google, SAP, Oracle, Microsoft, and Amazon are heavily involved in cloud services.
Example: Amazon Web Services (AWS) providing a wide range of cloud services.
Challengers: Salesforce, Workday, Box, Servicenow, Xero, and Netsuite also play a significant role.
Example: Salesforce offering cloud-based CRM solutions.
What is SaaS?
SaaS stands for Software as a Service.
It involves delivering applications over the Internet.
Example: Using Microsoft Office 365 for email, document editing, and collaboration.
Key Characteristics:
No installation needed: Access applications directly through a web browser.
Example: Using Gmail without installing any software.
Always up to date: Providers handle updates and maintenance.
Example: Automatic updates for Google Workspace apps.
Low upfront costs: Typically subscription-based pricing.
Example: Paying a monthly fee for Adobe Creative Cloud.
Accessible from anywhere: Access applications from any device with an internet connection.
Example: Accessing Salesforce from a laptop, tablet, or smartphone.
Scales easily with business needs: Easily adjust resources as needed.
Example: Scaling up storage space on Dropbox.
Characteristics of the Cloud
Cloud services differ from on-premise solutions.
Important characteristics:
Ease of use: Focuses on simplifying user experience.
Example: User-friendly interfaces and intuitive design.
Specific for one purpose: Cloud applications often target a specific need.
Example: A cloud-based accounting software designed specifically for small businesses.
Simplicity: Offers straightforward solutions, avoiding unnecessary complexity.
Example: Simple setup and configuration processes.
Collaboration: Cloud facilitates teamwork.
Example: Google Docs allowing multiple users to edit a document simultaneously.
Mobile Access: Enables access from various devices.
Example: Accessing cloud-based CRM from a mobile phone.
Customer Success Management: Focuses on renewals and upsells for revenue generation.
Example: Providing dedicated support and training to ensure customer satisfaction.
How does the cloud change business?
Uses process modeling domain as an example.
Compares traditional tools like ARIS with cloud-based tools like Signavio.
ARIS: Over 20 years old with a large community and user base.
Example: Used for comprehensive business process analysis and design.
Signavio: Cloud-based, founded in 2009, growing rapidly with numerous customers.
Example: Offers collaborative process modeling and automation features.
Business Intelligence
Business Intelligence for Decision Making
Applying tools and techniques to internal and external data.
Example: Analyzing sales data and market trends to identify growth opportunities.
Aims to facilitate a better understanding of the environment and operations.
Example: Using dashboards to monitor key performance indicators (KPIs).
Intended to improve the decision-making process.
Example: Making data-driven decisions rather than relying on intuition.
Key Features of Business Intelligence
Internal and external inputs: Combining data from various sources.
Example: Integrating sales data, customer feedback, and market research.
Structured and unstructured data: Processing diverse data formats.
Example: Analyzing both quantitative data (sales figures) and qualitative data (customer reviews).
Improved support for creating business strategy: Aligning BI with strategic goals.
Example: Using BI insights to develop a new market entry strategy.
Gaining competitive advantage: Identifying opportunities and threats.
Example: Monitoring competitor activities through BI tools.
Improving support for decision-making: Providing actionable insights.
Example: Using BI dashboards to make real-time decisions.
Increasing the use of performance indicators: Monitoring key metrics.
Example: Tracking sales, customer satisfaction, and operational efficiency.
Elements of BI systems include: Data Warehouse, Data mining, OLAP, Dashboard, Business Activity Monitoring, and Analytics.
Business Intelligence in Action
Rolls-Royce uses business intelligence for various operational aspects.
Example: Optimizing maintenance schedules for aircraft engines based on real-time performance data.
Tools and Techniques for Business Intelligence
Decision support systems: Assisting in decision making.
Example: Using a DSS to evaluate different investment scenarios.
Group decision support: Facilitating collaborative decision making.
Example: Using a GDSS to gather input from multiple stakeholders.
Document management systems: Storing and organizing information.
Example: Using a DMS to manage contracts and reports.
Online analytical processing (OLAP): Analyzing multidimensional data.
Example: Using OLAP to analyze sales data by region, product, and time.
Data warehousing: Storing and managing large volumes of data.
Example: Using a data warehouse to consolidate data from various sources.
Data mining: Discovering patterns and relationships in data.
Example: Using data mining to identify customer segments.
Digital dashboards: Providing a visual overview of key metrics.
Example: Using a dashboard to monitor sales performance.
Expert systems: Computer system emulating human expert decision making, now revived through Robotic Process Automation.
Example: Using an expert system