Dominos Pizza Electronic Business Activities - Coursework Example

E-BUSINESS PROJECT: DOMINO’S PIZZA (Name) (University Affiliation) Introduction Owned by Domino’s Pizza, Inc, which is a listed company in US, the Australian Domino’s holds all master franchise rights in France, Belgium, Netherlands and Newland. In addition, the company has more one 1,341 store in six countries and employs almost 26,500 employees. Domino’s Pizza Enterprises is the leading international Domino’s franchisee (Goyal, 2013). The Australian company runs a chain of retail food stores as well as gives franchise services for its branded retail food outlets. Domino’s headquarters is located in Hamilton, Queensland and listed under the ticker DMP on the Australian Securities Exchange. Since its establishment, the company has experienced tremendous growth rate due to its embracement of E-Business (Black, 2013). For instance, the 2014 profit has been generated from a total network sale of $846.4 million, which reflects a 12% increase compared to the previous year’s 6%. Domino’s Market Capital stands at $2,326 million while its Equivalent Shares stands $86million. Today, any serious organization with an objective of realising regional and international market growth has to apply E-Business practices in its general operations. In order to compete effectively in the business environments, businesses have to use the internet and other electronic processes such as buying and selling goods, delivering services and processing payments. These electronic processes are referred to as E-Business. As such, this report seeks to delineate the concept of E-Business and how it can be implemented in an organization effectively. The report will focus on Domino’s Pizza electronic business activities in explicating the E-Business strategy. Domino’s Pizza Mission Statement Domino’s is committed to practicing excellence in three aspects: quality service, unique products as well has delivery. Its practice of excellence in the above three key areas has made it to be the world’s leader in pizza preparation as well as delivery. Its mission to be “Number 1 in pizza” and “Number 1 in people” has made the company to be the eighth largest among the world’s restaurant chains (Black, 2013). Strategy Analysis Domino’s Pizza is focused in implementing various strategies to develop as well as insulate the firm from potential tough economic climates. Apparently, Domino’s is focused on organic growth integrated with the selling down of corporate. The company seeks to increase the quality of offerings, delivery and menu delivery across Australia and New Zealand. Moreover, Domino is also doing a substitution of its premium ingredients that are available as topping and at a surcharge (Black, 2013). Using mobile and TV-based technology, social-networks websites and other online platforms in advertising should serve as cheaper means of marketing across the globe. E-Business opportunities and its impact on existing business operations E-Business refers to any form of business transaction or activity that takes place electronically, in that there is no direct physical contact or physical exchange between parties. E-business involves the conducting of business through the internet. In addition, the main objective of introducing an E-Business activity is to create a positive reputation of the organization. Accordingly, the internet is used as medium of promoting businesses thus earning profits. Moreover, through E-Business, organizations get to collaborate with other business partners for enhancing the organizations. The use of E-Business offers additional customer value through using technologies, computing paradigm of the new economy as well as philosophies thus transforming the business. Evidently, since the inception E-Business, Domino’s Pizza has been increased its sales tremendously (Goyal, 2013). Applications of E-business The e-Business application comprises of three broad parts. First, a business can use E-Business for online commercial activities such as buying as well as selling of goods and services. For instance, Domino’s Pizza has enhanced its online services such that a customer can place an order online as well as pay for it and get the services delivered to him or her. Second, through E- Business organizations place their advertisements and other messages thus enhancing their marketing strategies. Moreover, organizations carry out activities such as customer relationship and enterprise resources planning. Domino’s Pizza has a FAQ section on its website to ensure that customer’s queries are attended to. Third, organizations undertake social activities such as supporting cultural enforcement and social interaction through chat, email and group discussions. For example, Domino’s Pizza has Facebook and Instagram accounts as well as a Twitter handle, which help the organization in establishing customers’ needs and complaints. The Domino’s Pizza has introduced ordering apps for Android and even iPhone, which covers approximately eighty percent of the Smartphone industry/market. How E-Business strategies differ from Traditional Business strategy In the traditional business strategy, information used to flow in a hierarchical manner. Accordingly, information flowed from the producer to the consumer. In the E-Business strategy, the internet has changed the information flow. First, the internet allows consumers to talk to consumers through email, social media, commentary as well as websites and blogs. Second, consumers can find information with ease as compared to the traditional business strategy. Finally, the internet has necessitated the flow of information to be reversed and as such, customer-centric firms can pull information from the customers in order to improve services. E-Business Models The E-Business model delineates how an organization operates in terms of revenue generation, how it provides its products as well as services and it will develop and adapt new technologies. The E-business Models helps an organization to understand the structures it will use in order to reach its customers thus realise customer satisfaction. i) Business-to-Business (B2B) Model B2B model involves a business selling its products to immediate buyers who then sell these particular products to the final client. For instance, a random wholesaler places his or her order on a company’s website and after receiving the consignment, the wholesaler sells the products to the end users who will come to a wholesaler’s retailer outlet. Domino’s Pizza uses the model in regard to ordering supplies that is used in preparing its dishes. For instance, the company uses large amounts of wheat flour and as such, it has to place an order online well in advance. Advantages First, the B2B model enhances market predictability as well as stability. When an organization secures relationships with its buyers, the firm’s ability to supply them may last for longer. Secondly, under such a model, the payment system is secure. The recent advancement in the payment technologies has necessitated encrypted as well as online secure payment. Disadvantages The problem with B2B is that it creates room for possible antitrust violation between the parties. Second, B2B does not create an equal level playground for start-ups thus; it creates a barrier for new entrants in the market. ii) Business-to-Consumer (B2C) Model Under this model, a business sells its products directly to the customer and as such, the customer has the ability to view the products on the organization’s website. For instance, a customer can order a certain pizza from Domino’s websites. Upon placing the order, the business will in turn dispatch the ordered product to its customer. Advantages B2C model often eliminate intermediaries since the firms sells directly to the consumer. B2C has helped Domino’s Pizza reduces the overall cost of doing business including the cost of hiring employees, transaction cost, purchasing cost, order processing cost, inventory cost and storage cost. The Internet allows you to reach people around the world, offering your products to a global customer base there you can buy the product easily. Disadvantages First, the model operates under a limited market place. Ideally, the customers will only be limited to certain areas. Second, the model encourages high sales cycle in that a great deal of phone calls and mailings are often needed. Competitive Analysis Businesses dealing with food chain outlets are increasing day by day and as such, the industry is highly competitive. Notably, there are about 160 well-known pizza businesses, which are both regional and international. These pizza franchise account for approximately 61% of the market share and the top two franchises include MacDonald’s Corporation Inc., Papa John’s International, Inc. McDonald’s Corporation Inc. McDonald’s Corporation Inc. is a massive international fast food franchise that is focused on expanding its market growth. In 2013, the company’s revenues exceeded US$28 billion and their logo is the major boast as people across the age group internationally recognize their long golden curved log (Rothwell et al, 2013). Although McDonald’s is on E-Business ventures, the company still depends on traditional methods of running a business. However, the company has been caught up in a series of legal issues, which has somehow tarnished its brand. Papa John’s International Inc Domino’s Pizza competes with Papa John’s on the same ground as far as pizza delivery is concerned. The company has transformed to E-Business and has an online enabled ordering application where customers can place their orders. In 2013, they recorded a US$1.4 billion net of revenue. They remain a big competitor of Domino’s as they are increasing their E-Business operations (Schnatter, 2014). Tentatively, there are an unknown number of pizza outlets across the world as new pizzerias and franchises are continually integrating E-Business to their activities to enhance customer satisfaction. Howbeit, the industry is facing challenges in the implementation of the E-Business strategies since a great deal customers are not techno savvy. Thus, more emphasis should be laid on training the customers before new applications concerning their products can be introduced in the market. The industry’s online sales are increasing, as the internet is more accessible and more reliable across the globe. In 2013, a study showed that, Australia’s online sales have reached $10billion thus forcing the pizzerias to develop more phone applications that support online business in order to realized an increased customer satisfaction. The technical needs and expertise required to conduct e-business Integrating a business from traditional business activities to E-Business is often a complex one. Accordingly, the transition requires both the financial and time for the staff to develop and adapt new concepts as well as organizational structures (KCOM, 2011). Additionally, the staff will be required to undergo some training, which will equip them with the knowledge concerning the new business model as well as the supporting technologies. For the E-Business to be realised, various concepts regarding the transition will have to be considered: i) Internet Access For an organization to communicate with its customer online, it will have to consider opening up simple email accounts such as Hotmail.cm and Gmail or use paid email accounts such as CompuServe. The email capability is essential as communications are safe kept and can be referred to promptly at any given time. ii) Websites Websites play an important role in the daily operations of E-Business. The website becomes the physical appearance of the organization and customers can develop their analysis to the organization’s image based on their experience with the organization’s websites. Additionally, the customer is supposed to get anything he or she needs on the websites as it is the organizations front office. In this regard, Domino’s Pizza has an official website, www.dominos.com.au that is operational for twenty-four hours a day. iii) Intranets For an effective coordination among the staffs to be realized, the organization has to create intranets. The intranets will help the communication between employees to efficient as well as make the employees comfortable with the new technology. In effect, the management in Domino’s uses the Intranet to communicate to its employees thus saving time and resources. iv) E-Commerce Capability The organization needs to create as well as host an interaction transaction site as this is the main objective of integrating a business to E-Business. Through this capability, the firm will be in a position to get customer’s orders and deliberate on any complaint. The average cost of putting up an E-commerce aspect is U.S$2.25 million. As such, Domino’s Pizza capitalizes on E-commerce Platform to understand the customers’ needs thus improving on its weaknesses as well developing new concepts that would help the company to grow. Extranets This is a secure private network, which uses web-based technologies as well as well he public telecommunication system to transact business with the customers, suppliers or partners. The Extranet has a firewall between the organization’s actual operations and extranet area. Equally, Domino’s uses its extranets to negotiate with its suppliers as well as communicate with their customers concerning online payment processes. Risk associated with E-Business Implementation There are various risks associated with E-Business: Information Risk, Technology Risk and Business Risk. Information Risk First, the content on the firm’s web page risks being exposed to deflation of character as well as libel. Second, people with bad intentions can infringe the firms’ copyright and invade its privacy suits through stemming the textual content that has been posted. Third, hackers can get an authorized access to the firm’s web site and extract information concerning the customers and employees. Ultimately, a firm can suffer from international legal exposure that violates the home country laws, which associated with the use of creative materials such as names and likenesses. Domino’s Pizza has been able to curb this risk through seeking the legal mandate associated with copyright infringement thus being knowledgeable as well as the necessary precautions to take when such incidents happen. Technology Risks The firm can suffer from negligent omissions or errors during the software design. Second, the firm’s website can experience unauthorized access to the website thus infecting the firm’s business systems with dangerous viruses. Third, the internet service provider can crash thus putting the firm’s operations on dilemma. Fourth, hackers can intercept credit information therefore causing security breaches in the online payments. Ultimately, the firm’s software content can risk copyright violations. In effect, Domino’s puts aside huge amount of money in its yearly budget to cater for the renovation and security enhancement for its websites as well as working with competent website and content developers. Business Risks The business can suffer malicious damages caused by individuals posting negative aspects about the business thus making the business to lose both potential and existing customers. Malicious individuals can use the firm’s website to run illegally promotional games such as contest or sweepstakes. Ultimately, the firm can suffer from intellectual property lost as employees may move to competitors. Consequently, Domino’s has standby online crisis management workers who can always respond to such malicious acts. Additionally, the organization uses powerful antivirus to protect their systems. Policies, Guidelines and Legislation related to E-Business Implementation. For fair business activities to exist, firms are required to adopt a fair business practice in compliance to the Trade Practices Act 1974, which stipulates that organizations operating in E-Business shall not engage in misleading and or deceptive practices. Secondly, firms are prohibited from coercing consumers during the buying and selling of goods and when obtaining payments. Third, organizations are prohibited from engaging n unconscionable conducts and should ensure they contractual terms they initiate protect the consumer rights and supplier’s legitimate interests. Fourth, as far as advertising and marketing is concerned, the law requires the businesses to make sure their advertising materials are clearly identifiable and that their content can be differentiated from other contents. Moreover, the law requires the advertisement material to be backed up by their marketing claims. As far as Information-Contractual is concerned, the businesses are required to provide enough, clear and accurate information concerning the conditions, terms as well as the costs of transactions. This would enable the consumers to informed decisions. Conclusion Summarily, it is evident that no business can survive in the current competitive business environment without transitioning its operations to E-Business. If a business wants to take care of its customers’ needs, it has to necessitate online transactions as the world has become a global village and as such, no customer would want to strain in order to get goods and services. References Bailey, M. A., Carlson, R. C., Glock, O., Knierim, S. E., & Tilley, D. M. (2013). U.S. Patent No. D510,264. Washington, DC: U.S. Patent and Trademark Office. Black, G. 2013. Applied Financial Accounting and Reporting. OUP Catalogue. Goldstein, Linda A. Goldstein and Wood, Douglas J. Wood (December 1997); Marketing in cyberspace: Identifying and evaluating the Legal Risks, Telecommunications, 31, p48-53 Goyal, A., & Singh, N. P. 2013. Consumer perception about fast food in Australia: an exploratory study. British Food Journal, 109(2), 182-195. Kaplan, A. M. 2012. 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