E-Commerce Jason C.H. Chen, Ph.D. - PowerPoint Presentation

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E-Commerce

Jason C.H. Chen, Ph.D.School of Business AdministrationGonzaga University, Washington, U.S.A.Senior Consultant, Taskco.comchen@gonzaga.eduNov. 20, 2000

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Topics

E-Commerce:From B2C to B2B and Beyonde-Bid ProcessFeatures of a B2B application.Business plan for an e-Marketplace (next year)e-CRM and 1-1 Marketing (next year)

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E-Commerce:

From B2C to B2B and BeyondJason C.H. Chen, Ph.D.School of Business AdministrationGonzaga University, Washington, U.S.A.Senior Consultant, Taskco.comchen@gonzaga.edu

Nov. 22, 2000

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Outline of Topics

EC, B2C and B2B and their models.How big is B2B?Where is the Evidence?What are the revenue models in B2B?What is driving adoption of B2B? Why now?TASKCo.com

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eBusiness Key Concepts

eBusinessThe strategy of how to automate old business models with the aid of technology to maximize customer valueeCommerceThe process of buying and selling over digital mediaeCRM (eCustomer Relationship Management)

The process of building, sustaining, and improving eBusiness relationships with existing and potential customers through digital media

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What is E-Commerce ?

Electronic commerce (EC) is an emerging concept that describes the buying and selling of products, services and information via computer networks, including the Internet.

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Figure:

E-commerce on the rise.

Source: 1999 SG Cowen/Datamation

Networked Computing Survey

Figure:

E-commerce apps are a big driver for storage. Average installed online storage in gigabytes.

Source: 1999 SG Cowen/Datamation Networked Computing Survey

No plans Start in 99/00 Expand in 99/00 Largely done

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Benefit

New

channel for

existing

business

Improved

customer

service

Enabled

entire new

line of

business

Reduced

operating

costs

Improved

cycle time

% of

Respondents

25%

23%

18%

7%

5%

Benefit

Keep pace

with

technology

Reduced cost

of sales

Other

Not

available

None

% of

Respondents

5%

4%

6%

4%

3%

Table: E-commerce’s most promising potential benefits

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eBusiness Processes

WHY

Customer Relationship

Redesign Business Processes (Outside-In)

Applying Technology

WHAT

HOW

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eBusiness Processes

WHY

Customer Relationship

Redesign Business Processes (Outside-In)

Applying Technology

WHAT

HOW

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C

B

C

B

Traditional versus E-Business Models?

C: Individual Consumer

B: Business

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What is B2C?

B2C (or Extranets) is just web-enabled relationships between existing partners; they tend to be run by a single company seeking to lower the cost of doing business with its current suppliers or individual customers.Examples?Amazon.comEgghead.com

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Enterprise

User Profiles

Workflow

Business rules

Payment

Analytics

Internet

Firewall

Intranet

Figure: A B2C e-business Model

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B2C Applications

Electronic storefrontElectronic mallsAdvertising onlineService onlineselling books, toys, computerse-banking (cyberbanking)online stock trading

online job market, travel, real estate

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Figure : B2C and B2B Internet Commerce in the U.S.

(Source: Forrester Research)

Billion

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What is B2B?

“B2B” is business-to- business commerce conducted over the Internet (called B2B e-commerce space, or e-marketplaces)

N

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B2B e-Markepplaces:

A CEO’s Perspective“The next chapter in the e-business revolution involves the transformation of entire markets and the redefinition of industries. We will see the rise of a new class of entities -- e-Marketplaces -- that will help online buyers and sellers find each other, attack the inefficiencies of traditional markets, and carve out for themselves important roles in the e-business economy.”Louis V. Gerstner Jr.Chairman of the Board and CEO

IBM Corporation

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E-Market is …

Web-based marketplacee-market is Web sites where buyers and sellers come together to communicate, exchange ideas, advertise, bid in auctions, conduct transactions, and coordinate inventory and fulfillment

Buyers

Sellers

MarketSite

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Figure : A B2B Model

(Source: Goldman Sachs Investment Research Report)

Banks,

Financial Institutions

eCredit.com

Suppliers

Production materials

Operating goods, services

Invoices, Payment , Clearing

Enterprise

Customers

Logistics

Celarix, NTE

Transportation, Warehousing

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E-Channel

Management

Procurement

Network

Trading

Network

E-Customer Relationship

E-Commerce

E-Portal Management

E-Business, E-Services

SCM/ERP/Legacy Appls

Businesses (PRM)

Businesses & Consumers (CRM)

1:N

M:1

M:N

Knowledge Management/Business Intelligence

Focus on e-Business Applications

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B2B Applications

AdvertisingAuctioningProcurementChannel managementE-commerce

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Figure: The Goldman Sachs B2B Sizing in USA

How Big is B2B?

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Where is the Evidence

Three highlights from the Goldman Sachs B2B survey 1.0:E-Commerce spending on proprietary Web site, e-market, and procurement (75% say, in 2000)Business are increasingly likely to develop B2B e-markets and to favor online auctions (74% say, in 2000)Outsourcing e-commerce spending is commonplace among businesses (25% say, up to 75% of e-C spending)

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B2B Revenue Model

B2B companies exhibit varying business models, depending on the key products and services they offer. The models include:transaction fees,auction-driving commissions,advertising,content subscriptions,software licensing

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B2C vs. B2B

Source: Goldman Sachs Investmenet Research

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The Magnificent Seven B2B Drivers

Increasing competition and globalizationGrowing interactivityFinancial opportunityEfficiencies and cost savingsEnhanced market and customer reachReal-time needs

Regulatory and taxation issues

N

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Small Business Likely to Fuel B2B

Small businesses will fuel the B2B marketthe use of and dependence on the Internet by small businesses as a medium for marketing, distribution, and commerce will likely fuel the B2B market.as more small business access the Internet and set up corporate Web pages, the more they will employ the Internet to execute their business strategy.

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Benefits of B2B

B2B solutions create competitive dynamics through:cost savingsthe composition of cost (product versus process costs)the number of intermediaries in the supply chain.new financial (revenue) opportunities

the rate of industry-wide B2B adoption

business model

N

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Why Now?

B2B catalysts are now arising to stimulate adoption (mentioned earlier).Interactive networks have recently become ubiquitous and inexpensive, accelerating the use of B2B applications.A viral effect will spur copycat behavior throughout the market as more companies continue to implement B2B applications.

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Which Industries are Likely to Embrace B2B Solutions

Industries that are B2B inclined exhibit certain key characteristics:the supply chain is highly diffuse,techno-innovators dominate the culture,process represents more than 20% of total costs,products exhibit complex configurations,expense pressure is intense.

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Research show that leading industries migrating online and adopting B2B solutions include the following:Aerospace/Defense: 35%Electronics: 25%Chemicals: 20%Motor vehicles and parts: 18%Medical equipment and transport: 17%

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What Makes a B2B e-market Company Succeed?

Five Critical Success Factors for e-markets:Business model,market size,industry expertise,branding and distribution,management execution hustle (not just the formulation of strategy)

N

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Solutions for e-Enterprise Organizations

Streamlines buying and selling between trading partnersMaximizes trade efficiency across the entire supply chain

Strategic e-commerce capabilities in Internet time

Delivers compelling ROI

Buyers

Sellers

MarketSite

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Solutions for Internet Market Makers

Turn your supply chain into a revenue generation opportunity Leverage your industry domain expertise into strategic e-commerce solutionsBrings e-commerce to businesses of any size, across all industries

Your

Portal

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Global Solution for Businesses:

The Global Trading Web

Global

Trading

Web

Connect once to trade with anyone,anytime, anywhere in the world.

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European e-markets

B2C e-commerce in Europe is likely to remain approximately two to three years behind the U.S. .B2B in Europe currently lags the U.S. by two years.

How about in Asia?

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TASKCo Mission

Expand

Markets

Improve

Efficiencies

Retain

Customers

Fundamental

Business

Drivers Have

Not Changed

Leveraging Internet to Help Customers to:

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E-Channel

Management

Procurement

Network

Trading

Network

E-Customer Relationship

E-Commerce

E-Portal Management

E-Services

SCM/ERP/Legacy Appls

Businesses

Businesses & Consumers

1:N

M:1

M:N

Knowledge Management/Business Intelligence

Focus on e-Business Applications

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This Market Place offers an integrated suite of capabilities that enables all modes of access, reduce buyer

’s total cost of ownership and seller’s marketing costs, eventually increase revenue for both parties.

— Suppliers —

— Buyers —

Needs evaluation

Fact-based Negotiation

Procurement Policies & Procedures Mgmt.

Maintenance,

Disposal, &

Renewal

Catalog Production

Order Acceptance

Logistics

Financing

Reporting of

Item Level Detail

Trend Analysis

Budget Tracking

eService

eSuppliers

ePayment

Financing and Credit

Risk Mgmt.

Billing and Payment Processing

Payment Settlement (A/P and AR)

Financial Control Management

eProcure

3rd Party Logistics

Order Mgmt.

Catalog Maintenance

On-Line ordering and tracking

eCustomer Service and Transaction Processing

Order Acknowledgement

eBuyer

B2B Marketplace

Catalog

?

Usage/Demand Analysis and Forecasting

Asset Recognition and Tracking

Payment Info.

(e.g., P-Card)

Objectives

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TASKCo.com Business

TASKCo Trading Network

Infrastructure and Operation

Finance.com

Logistics.com

Textile.com

Component

Electronics

PC Industry

IPBank.com

Travel.com

Home Hardware.com

Transportation.com

MediNet.com

Knowledge Management Services

Customs.com

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企業間電子採購作業

賣方/供應商 企業電子商務市場 買方/經銷商

企業採購電子商務作業系統

供應商

供應商作業平台

經銷商作業平台

經銷商

•

訂單管理

•財務管理

•交貨管理

•顧客管理

•電子型錄

•詢價管理

•快速下單

•帳戶管理

供應鏈

Supply Chain

電子採購作業系統

需求鏈

Demand Chain

物流

資訊流

金流

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B2B e-Procurement Processes

Seller/Supplier e-Marketplaces

Buyer/Wholesale

B2B e-Procurement Process System

Supplier

Supplier

Trading Platform

Order mgt.

Finance mgt.

Shipping mgt.

Customer mgt.

e-catalogue

inquiry/

negotiation

quick ordering

account mgt.

供應鏈

Supply Chain

e-procurement process system

需求鏈

Demand Chain

Material Flow

Information Flow

Money Flow

Buyer/Wholesale

Trading Platform

Buye/r

Wholesale

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Document,

Update

Process

Operational

Data

Repository

(Shared)

Lotus Notes

OLAP Tools

(Decision Support)

Data Mining

Tools (Pattern Analysis)

Work

Flow

KNOWLEDGE MANAGEMENT PROCESSS in the TASKCo Platform

e-portal

Business

Intelligence

Knowledge

Management

MARKETPLACE







MARKETPLACE

ASP

Category

V.A

.

(one-stop)

Context

1

2

3

4

easy access

Timely news (filtering)

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Document,

Update

Process

Operational

Data

Repository

(Shared)

Lotus Notes

OLAP Tools

(Decision Support)

Data Mining

Tools (Pattern Analysis)

Work

Flow

KNOWLEDGE MANAGEMENT PROCESSS in the TASKCo Platform

e-portal

Business

Intelligence

Knowledge

Management

MARKETPLACE







MARKETPLACE

ASP

Category

V.A.

(one-stop)

Context

1

2

3

4

easy access

Timely news (filtering)

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Conclusion

So grab your board, take the challenge because…