E-Commerce: The New Reality - Literature review Example

E-Commerce: The New Reality E-Commerce: The New Reality Introduction The growth in terms of technology has played a significant level of role in causing globalization to be accepted in the world. In the modern era the companies that have not integrated technology in their infrastructure are dying out because new and more advanced methods of management have taken over and they have helped the companies in shortening the strategic response time to the market changes. These developments however sent the least developed rivals to the road of damnation and obsolesce in all industries. The online commerce sites such as e-Bay and Amazon are considered as one of the leading businesses. The recognition of e-business model has in fact enlightened the world about the fact that the online commerce activity is much better than the conventional one as it allows the companies to have lower costs and therefore they can make higher profits. Importantly according to various researchers the economies with higher literacy and computer literacy rate are ideally suited for the implementation of e-commerce because computer is an integral part of today’s business world. In developing nations the concept of e-trade is growing significantly but the development of full fledge electronic economy is a far cry at this time. The growth and strengthening of the e-commerce is closely linked with computer and traditional education. Literature Review E-commerce is defined as the practice of buying and selling in an electronic setting. The featured practice provides the basis for e-business that is the integration of information technology in each and every aspect of the corporate activity such as recruitment, accounting and even Human Resource Management is becoming online nowadays. In developing nations the concept of e-management is quite prevalent at this point in time. The recent research on the topic suggests that the application and understanding of the technology is the source of competitive advantage in the real sense. Moreover it is also very important to retain those employees who have the ability to keep the infrastructure running while the companies are also suggested to train the managerial staff in understanding the information so that they can base their business decisions on the information provided by the technology. The vast scale implementation of the internet in the business world has assisted the customers in counteracting and eliminating the role of middleman who is notorious for charging higher prices to the customers. The internet has therefore driven down the consumer prices in many industries. The companies however are enjoying the benefits of lower cost due to integration of technology that helped them in minimizing the storage costs of the products,. Role of Technology in Business to Business Trade The role of technology in terms of enhancing business to business trade is significant because it assisted the buyers and suppliers in interlinking the information systems. This development caused the integration of inventory management systems of the above mentioned parties that minimized the possibility of delayed orders and deliveries. It also has driven storage costs with the help of Just in Time inventory concept. The application of integrated ERP systems can be observed in Toyota’s production that flourishes on the idea of timely inventory delivery. In Japanese production facility of the company the vehicles are assembled while their parts keep on being delivered. The delivery of the parts and their fitting into the vehicles almost takes place simultaneously. Additionally the ERP systems permit the suppliers to see their clients current inventory levels so that they can make arrangements to supply components that are low in number. Main Aspects of Networked Economy Model Following are the major attributes of the Networked Economy Model 1. Free availability of Information: It is the responsibility of the government to ensure an adequate level of information about economic developments and event in the public while follows the networked economy model (Sheth, Aalst, & Arpinar, 1999). The governmental financial resources should be diverted towards providing necessary infrastructure to every citizen so that she or she can access, produce and disseminate information. 2. Online education: The nature of the educational facilities will also change and the educational and industrial integration will also become strengthened over the passage of time (Sheth, Aalst, & Arpinar, 1999). Furthermore, the time required to apply new knowledge in the practical world will be shortened whereas the creation of the knowledge will also become rapid in the future. 3. Simpler web design: The mechanism for making information public on the internet will also transform into a simpler practice under the networked economy model and the blogging can be taken as an early form of that system (Sheth, Aalst, & Arpinar, 1999). 4. E-Business: Each and every aspect of the economy will become electronic in the future. The legal system will have to maintain an online record of the crimes and criminals. The businesses are supposed to conduct accounting, recruitment and inventory management in an electronic fashion (Chaffey, 2002). Impact of E-Commerce on Retailing Industry The online retailing sites such as e-bay and Amazon are the finest examples of e-commerce because they have managed to eliminate the tradition of middleman who caused the consumer price of the product to increase (Chaffey, 2002)s. But now the customers have the luxury of meeting sellers online and negotiate the prices as well. These sites also minimized information asymmetry between buyers and sellers with the help of informing customers with updated prices every day. Nevertheless it is false belief that these business sites entirely uprooted the practice of intermediation however they have caused the margins to drop significantly. Methods of gathering web-usage data The methods of gathering web-usage data are enlisted as follows 1. Server Level Data Collection: This technique is used to gather internet usage data with the help of analyzing access logs on a server of a certain website (Srivastava, Cooley, Deshpande, & Tan 2000). This method allows people to gather information about the web pages that prevailing as most attractive ones. This method is however believed to expensive in nature because it will require lots of people in order to analyze the traffic on a significant number of websites. 2. Online User Profiling: The law enforcement agencies are famous for relating a certain type of internet usage behavior with a specific sort of users for instance the terrorists are notorious for having an interest in violence (Srivastava, Cooley, Deshpande, & Tan 2000).. This method can result in breach of the user’s privacy. Models of Business Web Development The following are names prevailing models of business web development 1. Entity- relationship Model 2. Object-oriented Model 3. Ontology-Based Model Steps of Entity- relationship Model These are the steps involved in the process of using Entity- relationship Model for web development 1. Identification of Entities: This step includes enlisting all the relevant entities that are required for the development of the website. The major purpose of sites designed with this method is to disseminate information with reference to various roles and responsibilities such as in school there are teachers, subjects and classes. 2. Building Logical Relations among the Entities: This step entails constructing logical and meaningful relations among the entities identified in the preceding step such as a teacher teaches many classes 3. Entering the Data: In this step all the relevant data is put in the tables that are developed with the help of a software such as MS Access. 4. Development of Forms: This step is all about the formulation of forms that help users in searching for the specific information from the website such as building a form for helping the visitors to find out that how many subject a certain teacher is teaching. Sources of Trust Following are the sources of strengthening customer trust in a website or a business as a whole 1. Deterrence based Trust: This kind of trust is the weakest and it can be broken due to one instance of inconsistency on the part of any party. The application of the idea in e-commerce can take place when an online business fails to deliver goods on time. 2. Knowledge Based Trust: This kind of trust can be fostered with the help of fulfilling one’s commitment to another on persistent basis. The website can develop this sort trust among customers by providing accurate pricing information. 3. Identification Based Trust: This sort of trust emanates from creating a win-win model by respecting and fulfilling each other’s desires and wants. This can be achieved with the help of providing desired products at a reasonable price. The role of web design in fostering customer trust Following are the means of establishing trust in online clientele 1. Accuracy of data presented on a website 2. Ease of access 3. Currency of the data Ethical and Legal Issues with E-Commerce The e-commerce have a tendency to cause a privacy breach and it can also result in an identity theft of the customer. The e-businesses are suggested to employ state of the art anti-hacking software in order to prevent above happenings. The companies are also recommended to analyze the consumer behavior to see that whether or not they are fetching inappropriate methods for gaining a cost advantage. Role of Search Engines in Advertisement Search Engine Optimization Consultation is one of the most important sectors in the internet industry. The basic reason of the growing importance of the SEO Consultation, is the need of businesses to be searched on the internet more prominently. The e-commerce practices such as online selling could be the only meaning that could help and assist small businesses in terms of competing against larger organizations. The salient advantages of e-commerce include cheaper advertisement and less staff requirement, while e-business practices can be run against less administrative costs. All of these advantages can lead to higher profit margin that is in fact the ultimate goal and objective of any business. Conclusion The world of the 21st century is becoming digitized with every passing moment. The world economy is also transforming into an electronic marketplace. The trade barriers are lowered and therefore the practice of business is expanding in all corners of the world. The nations are facing the challenges of higher internationalization of their local organizations because operating in one or two economies is not recommended in the world where globalization is taking place at an immense rate. References Chaffey, D. 2002. E-Commerce and E-Management . Prentice Hall. Sheth, P., Aalst, P., & Arpinar, I. 1999. Processes Driving the Networked Economy:Process Portals, Process Vortexes, and Dynamically Trading Processes. Concurrency 7 3 . Srivastava, J., Cooley, R., Deshpande, M., & Tan, P. 2000. Web Usage Mining: Discovery and Applications of Usage. SIGKDD Explorations 1 2 , pp.1-12. Read More