MANAGEMENT & LEGAL IMPLICATIONS OF eCOMMERCE Definitions eBusiness The use of computer based...

MANAGEMENT & LEGAL IMPLICATIONS OF eCOMMERCE

Definitions eBusiness

The use of computer based information systems for the management and coordination of business processes.

eCommerce

eCommerce is the process of buying and selling goods and services electronically using computer based information systems and networks.


The Role & Development of EC


The Role & Development of ECHistory 1970's EFT EDI Dial up access 1990's - www Growth of networking


Virtual Process

Virtual Player

Virtual Product

Pure EC

Traditional Commerce

Physical Agent

Digital Agent

Digital Product

Physical Product Physical Process

Digital Process

Electronic Commerce Areas

Pure versus partial EC


Perspectives communications business process service online


Dimensions

Technology People

Task

Structure


Classification by Transaction B2B B2C C2C C2B Nonbusiness EC Intrabusiness EC


Classification by process electronic markets interorganisational systems customer service


Interorganisational systems Includes customers and\or suppliers Moving from proprietary communications links to

the Internet Types

EDI Extranets Electronics Funds Transfer Electronic forms Integrated messaging shared databases supply chain management


Interdisciplinary Nature Marketing Computer Science Consumer behaviour and psychology Finance Economics Management Information Systems Accounting and Auditing Management Business law and ethics Other


Home User Logs

On

Home Page

Catalogue Purchase Order &

Transaction Processing

Order Information

Legacy Systems

Payment Options

User Profile

Legacy Integration Bank


Future of EC eCommerce revenues in the Asian‑Pacific

region will rise from US$76.8 billion at year‑end 2001 to an exponential $338.5 billion by the end of 2004 (eMarketer)

Over $40 billion per annum in USA in 2002 - 28% growth per annum (US Govt)


Growth in US eCommerce


Benefits & Limitations


Benefits to Organisations Expands marketplace Decreases cost of handling paper Create specialised businesses (niche markets) reduced inventories through “pull” supply chain

management competitive advantage through new systems reduces time between outlay of capital and receipt of

product (reduced cycle time) lowers telecommunications costs improved customer service research


Benefits to Consumers 24/7 shopping more choices conduct quick comparisons quick delivery (especially digital products) detailed information virtual auctions increases competition (global market) interaction with other customers


Benefits to society work at home lower prices makes services and goods available to people

in remote areas delivery of public services


Limitations of EC security authentication lack of trust & user resistance privacy integration with existing applications and

systems incompatible software\hardware (lack of

standards) bandwidth


Limitations of EC (Cont.) high development costs and low ROI (what is

the value of intangibles) legal issues support services (especially transport) lack of critical mass of buyers & sellers breakdown of human relationships


Organisation

Technology

Market Society

Information Technology


Driving forces for ECA New world Order of Business? Highly competitive environment consumers are the focus Business environment can change quickly Business environment can change unpredictably


Driving forces for EC (Cont.)Market & Economic pressures strong competition global economy regional trade agreements low labour costs in third world countries frequent & significant changes in markets increased power of consumers


Driving forces for EC (Cont.)Societal & Environmental pressures changing nature of the workforce government deregulation shrinking government subsidies increased importance of ethical and legal

issues increased social responsibility of organisations rapid political changes


Driving forces for EC (Cont.)Technological pressures Increased innovation information overload rapid decline in technology costs vs

performance ratio


Economic and Global Issues in EC


The Marketspace Match Buyers and Sellers

Determination of Product Offerings Search of Buyers for Sellers and Vice a Versa Price Discovery Intermediaries


The Marketspace (Cont.) Facilitate Transactions

Logistics Settlement Trust

Provide Institutional Infrastructure Legal Regulatory


IT Increases Market Efficiencies by Expediting Or Improving Market Functions Lowering Buyers’ Search Cost Enabling Speedy Comparisons Lowering Prices Reducing geographical constraints Lowering barriers to entry (especially small

firms) Increasing information to parties Allowing greater product differentiation


Firm Size (Employees)

Tra

nsa

ctio

n C

ost

Reducing transactions costs


Firm Size (Employees)

Ag

ency

Co

sts

Reducing Agency Costs

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