Download Chapter 8 - College of Business « UNT

Management Information Systems,
Sixth Edition
Chapter 8:
The Web-Enabled Enterprise
Objectives
• Describe how the Web and high-speed Internet
connections are changing business operations
• Explain the functionality of various Web
technologies
• Compare and contrast options for Web servers
• Explain basic business-to-business and
business-to-consumer practices on the Web
• Explain the relationship between Web
technologies and supply chain management
Management Information Systems, Sixth Edition
2
Objectives (continued)
• Give examples of features and services that
successful business Web sites offer
• Learn about online annoyances such as spam
and adware, and how to protect against online
identity theft
Management Information Systems, Sixth Edition
3
Web Business: Growing and Changing
• DLA Piper LLP is the second largest law firm in
the world
– 3200 lawyers in 24 countries and 63 offices
around the world
– Uses eRoom, a Web-based collaboration and
document-sharing tool from EMC Corp.
– Saves 15,000 labor hours annually, uses and
mails significantly fewer paper documents, and
reduces redundant work
Management Information Systems, Sixth Edition
4
Web Technologies: A Review
• Several standards and technologies enable the
Web to deliver rich information, including:
–
–
–
–
–
–
–
–
HTTP, HTML, XML
File Transfer
RSS
Blogs
Wikis
Podcasting
IM
Cookies
Management Information Systems, Sixth Edition
5
HTTP
• Hypertext Transfer Protocol (HTTP): transfer
and download Web information
• HTTPS: HTTP secure for confidential data
exchange
• Uniform Resource Locator (URL): unique
address given to each Web site
– IP address: a special numeric address
• Domain name: unique name for a Web site,
constructed with letters
– URL also refers to the domain name
Management Information Systems, Sixth Edition
6
HTML and XML
• Hypertext Markup Language (HTML): helps
developer create Web pages
– Determines look and location of content
• Extensible Markup Language (XML): enables
creation of various data types
– Conveys the meaning or content of the data
• XHTML: combination of XML and HTML
– Uses opening and closing tags to control format
Management Information Systems, Sixth Edition
7
Management Information Systems, Sixth Edition
8
File Transfer
• File Transfer Protocol (FTP): used to transmit
whole files
–
–
–
–
Used in all downloads from Web sites
Any type of file can be transferred
Can place files on a server for shared use
Often used to deliver purchased software
products on Web sites
Management Information Systems, Sixth Edition
9
RSS
• Really Simple Syndication (RSS): family of
XML file formats that allow automatic downloads
of content on a subscription basis
–
–
–
–
–
Helps users check for updates
Communicates short descriptions of content
Allows transmittal of new information
Useful on news Web sites
Also called Rich Site Summary
Management Information Systems, Sixth Edition
10
Blogs
• Blog: contraction of “Web log”
– Invites surfers to post opinions and art
– Focuses on a topic or set of topics
– Trackback: a tool that notifies bloggers when
their posts have been mentioned elsewhere on
the Web
• Blogs are often used by businesses
• Importance of blogs to commercial organizations
is to find out what blog participants think and say
about the organization
Management Information Systems, Sixth Edition
11
Wikis
• Wiki (from Hawaiian, meaning “quick”): Web
application that enables users to add to and edit
the contents of Web pages
– All the software required to edit the Web pages is
embedded in the pages themselves
• Wikipedia: a popular online encyclopedia
• Wiki technology is a popular ingredient in
groupware (software used for collaboration)
Management Information Systems, Sixth Edition
12
Management Information Systems, Sixth Edition
13
Podcasting
• Podcast: publishing sound and video on the
Web for download
– Usually on a subscription basis
• Uses include:
– “Time-shifted” broadcast of radio station
programs for later listening
– Audio tours in museums
– Lectures in distance learning courses
– Garageband.com
• Allows aspiring musicians to post music tracks
Management Information Systems, Sixth Edition
14
Instant Messaging
• Instant messaging (IM): real-time chat
– Form of synchronized e-mail
– Chat room: communicate with a group
– Free applications for IM include:
•
•
•
•
•
AIM: AOL instant Messenger
Yahoo Messenger
MSN Messenger
ICQ
Trillian
– Business uses
• Customers can chat with sales or support reps
Management Information Systems, Sixth Edition
15
Management Information Systems, Sixth Edition
16
Cookies
• Cookie: small file that stores information about a
Web site visitor, stored on the visitor’s computer
–
–
–
–
–
Usually records the surfer’s ID
Often stores the surfer’s preferences
Provides convenience to consumers
Can be temporary (single session) or permanent
Potential for intrusion into surfer privacy
• Clickstream tracking: tracks a surfer’s clicking
activities
• Spyware: traces and reports online behavior
Management Information Systems, Sixth Edition
17
Proprietary Technologies
• Proprietary technology: intellectual property of
developer, not free for all to use
• Examples:
–
–
–
–
–
Local search engine
Shopping cart applications
Wish lists
Video streaming tools
Tools to analyze and predict Web visitor
behavior, especially shopper behavior
Management Information Systems, Sixth Edition
18
Web-Enabled Business
• Web-enabled business are classified according
to the interacting parties:
–
–
–
–
Business-to-business (B2B)
Business-to-consumer (B2C)
Government-to-business
Government-to-consumer
Management Information Systems, Sixth Edition
19
B2B Trading
• Business-to-business (B2B): trading between
businesses only
• B2B forms include advertising through:
– Search advertising: advertisements placed on a
search site result page
– Banners: images placed on Web sites that link to
a company site selling a product or service
• Impression: occurs when a page with a banner
is downloaded
• Reach percentage: the percentage of Web
users who visited a site in the past month
Management Information Systems, Sixth Edition
20
Management Information Systems, Sixth Edition
21
B2B Trading (continued)
• Exchanges and auctions act as online
marketplaces
• Intranet: network used only by employees of an
organization
• Extranet: network shared by employees of
different organizations, usually business partners
• Exchange: extranet for organizations that deal in
products and services of a particular type
– Exchange operator profits from transaction fees
• Auction: sells a great variety of items
Management Information Systems, Sixth Edition
22
Management Information Systems, Sixth Edition
23
B2B Trading (continued)
• Online business alliances: collaboration
between businesses in establishing a Web site
– Site operator works for the allied companies
– Suppliers are invited to sell through the site and
compete among themselves, driving prices down
Management Information Systems, Sixth Edition
24
B2C Trading
• Business-to-consumer (B2C): trading with the
general public
• E-Tailing: online retailing to consumers
• Fulfillment activities: picking, packing, shipping
• Consumer profiling: know customers better by
gathering information about their online activities
– Some consider this a violation of privacy
• Conversion rate: the proportion of site visitors
who make a purchase
Management Information Systems, Sixth Edition
25
Management Information Systems, Sixth Edition
26
Management Information Systems, Sixth Edition
27
B2C Trading (continued)
• Auction sites serve as a hub for consumers to
buy and sell
• Reverse auction: customers name their own
price for desired goods and services
• Content providers: offer information, artistic
work, classified ads, and video
• Electronic bill presentment and payment
(EBBP): provides online bills and payment
options for customers
• Phishing: type of fraud involving a fake Web
site
Management Information Systems, Sixth Edition
28
Management Information Systems, Sixth Edition
29
Management Information Systems, Sixth Edition
30
B2C Trading (continued)
• Extra-organizational workforce:
– Companies purchase labor from a larger pool
• Mobile commerce, or M-commerce:
– Business conducted on mobile devices
• Many experts believe that information delivery is
the main mobile application, not commerce
– Exceptions are Japan and South Korea
– Japan’s DoCoMo’s i-mode service allows users of
smart cell phones to purchase canned soda from
vending machines, fast food
Management Information Systems, Sixth Edition
31
B2C Trading (continued)
• M-commerce also raises privacy concerns
– GPS provides location tracking
• New top-level domain names with .mobi
available for mobile applications
– Sites should use special technologies to optimize
content for easy viewing on mobile devices
• Virtual world: a combination of images, video,
sound, and avatars that resemble the real world
– Accessible for interaction by subscribers
• Avatar: 3D graphical character that represents a
user in a virtual world
Management Information Systems, Sixth Edition
32
Supply Chains on the Web
• Supply chain management (SCM) systems may
be connected to the Web to allow suppliers to
participate directly
– Use of XML allows companies to set standards
for data exchange
• Electronic Data Interchange (EDI): a system
used prior to the Web to exchange documents
electronically
– Set standards for data formats
– EDI networks are owned and managed by valueadded network (VAN) companies
Management Information Systems, Sixth Edition
33
Management Information Systems, Sixth Edition
34
Options in Establishing a Web Site
• Web site: Web pages that make up information
and links
• Internet server: a computer connected to the
Internet backbone
• Businesses have two choices for a Web site:
– Installing and maintaining their own Web servers
– Contracting with a Web hosting service
Management Information Systems, Sixth Edition
35
Owning and Maintaining a Server
• Owning and maintaining Web servers is costly
– Provides the greatest degree of control, but
requires expertise to set up and maintain
– Must obtain a high-speed link to the Web
• Load balancing: transfer data requests from a
busy server to a less busy server
• Mirror servers: servers with duplicated content
• Pure-play: company whose entire business is
online
• Brick-and-mortar: company that owns physical
stores and a Web site
Management Information Systems, Sixth Edition
36
Using a Hosting Service
• Web hosting: Web server managing service
• Several types of Web hosting:
– Shared hosting: stores the client’s Web site on
the same physical server as other clients
– Virtual private hosting: simulates a single server,
allowing a client to have its own domain name
– Dedicated hosting: client has exclusive use of an
entire physical Web server
– Co-location: server owned and managed by a
client is co-located with other clients’ servers in a
secure physical location
Management Information Systems, Sixth Edition
37
Considerations in Selecting
a Web Host
• Compare host vendors using a point system
• Dynamic Web pages: enable communication
between browser and database
• Factors to consider when selecting Web host:
–
–
–
–
–
Allows use of database management system
Storage space capacity
Technical and Web site design support
Scalability
Security: physical and virtual
Management Information Systems, Sixth Edition
38
Considerations in Selecting
a Web Host (continued)
• Factors to consider when selecting Web host
(continued):
– Availability: minimize downtime
– Costs, including:
• Setup fees
• Traffic-based fees
• Monthly fees
Management Information Systems, Sixth Edition
39
Management Information Systems, Sixth Edition
40
More Than Meets the Eye
• Several elements are essential to conducting
business on the Web:
– Inquiry interface: connects to database to allow
user to search a catalog of products or services
– Order processing application, including:
• Credit-card verification application
– Order-fulfillment system: picks, packs, and ships
Management Information Systems, Sixth Edition
41
Management Information Systems, Sixth Edition
42
Rules for Successful
Web-Based Business
• Business success depends on availability and
use of software
• Elements needed to support B2C commerce:
–
–
–
–
–
–
Targeting customers
Capturing the customer’s complete experience
Personalizing the service
Shortening the business cycle
Let customers help themselves
Be proactive and de-commoditize
Management Information Systems, Sixth Edition
43
Target the Right Customers
• Target customers needing your products and
services
– Most important effort of marketing
• Involves identifying the sites that your audience
frequently visits
• Consider blogs and podcasting sites for
advertisement placement
Management Information Systems, Sixth Edition
44
Capture the Customer’s Total
Experience
• Use cookies to record shopper’s movements
within the site
• Use CRM software to create consumer profiles
• Shopper experience becomes an asset of
business, allowing:
– Fine-tuning of the product portfolio
– Tailoring of Web pages to individual customers
– Individual e-mails to shopper offering products of
interest
Management Information Systems, Sixth Edition
45
Personalize the Service
• CRM software and Web page customization
software can be combined to:
– Personalize Web pages shown to a customer
– Allow the customer to select the type of e-mail
content desired
– Respect visitor privacy by offering opt-in rather
than opt-out
– Allow the customer to tailor products to be
purchased
Management Information Systems, Sixth Edition
46
Shorten the Business Cycle
• Business on the Web saves time for customers
• Fulfillment is a major challenge for businesses
– Activities after customer places order
• Fast shipping is desired because:
– It produces higher customer satisfaction
– Business collects payments faster
• Can outsource the entire fulfillment task to
fulfillment organizations such as:
– UPS’s e-Logistics
– FedEx’s Supply Chain Services
Management Information Systems, Sixth Edition
47
Let Customers Help Themselves
• Customers need information from organization:
–
–
–
–
Status of order
Status of shipped item
Installation instructions
Troubleshooting
• E-mail messages sent to customers with
information about orders and how to track them
• FAQs online allow customers to find answers to
common questions
Management Information Systems, Sixth Edition
48
Be Proactive and De-Commoditize
• Prompt e-mail replies expected
• Proactive alerts expected for changes in orders
or services, or product recalls
• Automatic reordering features are desirable
• Must take initiatives to de-commoditize products
– Commodity: a product sold at roughly the same
price by many vendors (no differentiation)
– Addition of features or services prevents a
product from becoming a commodity by creating
differentiation
Management Information Systems, Sixth Edition
49
E-Commerce is Every Commerce
• Web technologies have been highly integrated
into the business world
– Difficult to identify which business activities are
on the Internet and which are not
• Web has been highly integrated into daily
activities of customers also
• Commerce and e-commerce generally have the
same meaning today
Management Information Systems, Sixth Edition
50
Summary
• Some industries have changed drastically
because of the Web
• HTTP is an Internet standard controlling Web
server addresses
• HTTPS is a security version of HTTP
• XML is a standard for description of data
• Blogs enable people to create discussion Web
pages
Management Information Systems, Sixth Edition
51
Summary (continued)
• Cookies help Web sites personalize the visitor’s
experience
• Many Web technologies are proprietary
• A business can maintain its own Web server or
use a Web hosting service
• Organizations should consider several factors
when selecting a Web host
• Web-enabled commerce is classified into B2B
and B2C
Management Information Systems, Sixth Edition
52
Summary (continued)
• B2B trading relies on electronic data interchange
(EDI) and XML
• Wireless handheld computers allow mobile
commerce, called m-commerce
• Online businesses must adhere to several factors
to be successful
• Virtual worlds provide a means to meet and
conduct business and social activities on the Web
• Spam and spyware are online annoyances
• Phishing is a pervasive fraud crime
Management Information Systems, Sixth Edition
53