E-Commerce in the Global Business Environment - Assignment Example

E-COMMERCE IN THE GLOBAL BUSINESS ENVIRONMENT Student’s Name Professor’s Name University Date E-Commerce in the Global Business Environment Task 1 Environmental Analysis Technique The modern business environment is so competitive that it is becoming mandatory for beginners to scan the environment and analyze all the dynamics that have a direct/indirect impact on the venture even before take-off (Lumpkin., et Al, 2002).The environmental analysis technique thus ought to be reliable and in tandem with the set goals and objectives as well as cushioning the business from possible threats and identifying possible strengths on which to build. To better understand the global business environment a PESTEL analysis is essential. Despite a successful start-up, business need to constantly monitor and evaluate the environment as it presents unprecedented threats that can be avoided if a careful environmental analysis is done. E-commerce websites can be accessed globally and thus, this e-commerce website will be keen to conduct business where there is no limitation to free internet access. Despite promoting small businesses and offering them a platform to market their goods this e-commerce website will be keen to avoid countries that lack political stability. This will help this e-commerce venture to avoid cases of money laundering as well as unnecessary censorship of the website. Every business venture’s success depends on a strong global economy, with a strong economy the venture will be able to incorporate many small businesses from all around the globe without worrying about currency exchange issues. A strong global economy will also present this venture with a wide market range. E-commerce businesses like Google, amazon and eBay have over the years relied on a favourable global economy to avail products to consumers from various retailers globally e.g. Samsung, Philips, Sony and many more Some businesses have failed on the global scale due to their inability to apply internationalization in their ventures. Having that the e-commerce website will seek to host small business from all around the globe; the website will offer options for almost all the languages in order to accommodate all customers. Moreover the e-commerce website will be customized to reflect a global image by having specific landmarks for specific countries pop up whenever the website is accessed from those locations, this will ensure inclusivity and continuity. E-commerce websites depends on technology thus this venture will rely on the innovativeness of the specific countries that will host the e-commerce website’s servers. This will ensure continuity on a global scale and encourage more discoveries. On the contrary, the success of the e-commerce website depends on meeting all the legal requirements of specific countries for instance implementing bans of some products acquiring licenses, ensuring ethical advertising strategies and meeting all tax obligations. Sources of Competitive Advantage The environmental analysis model yields sources of competitive advantage that the business will seek to build on: Differentiation-The competitiveness of the ecommerce business environment dictates that each start-up must be unique so that they can stand out from the rest. Currently, there are more than 3 million e-business websites with a global outreach. Most of them have existed over several decades and have built a reputation (Azadi, 2011). However, there is still a niche in the same market that can be exploited through a unique approach, entry and marketing strategy. In this case, my venture is all about bringing ambitious entrepreneurs together on a platform that gives them an opportunity to share ideologies and combine their financial and social capabilities to build an online community. The idea behind this venture is to empower small businesses rather than taking the market by storm. The business will give the market the much needed opportunity to have a share through decision making. Differentiation will also include standardizing the price to benefit the customer by heavily investing in activities that matter the most such as marketing mix. This will give the e-commerce website to tap into markets like groceries and other farm produces that has been ignored by most e-commerce websites. For the start, I target a small market and through provision of excellent service, the market is likely to grow without so much financial strains that through advertising. Excellent management/operations-Leadership/management contributes greatly to the success of any business. As a leader, the stakes are so high and there is no room for error as this will have a long-term impact on the business (Shin, 2001). The business idea and the leadership skills I possess are the biggest incentive I bring to the venture. The venture will be run by a dedicated team of employees with passion under my direct supervision. For ease of operation and management, I would prefer a leaner organizational structure of not more than 10 employees. As the business grows and the market expands, then additional staff will be a necessity. I will also have a team of technicians that offer real time assistance to the small businesses as well as customers that visit the website; all these undertakings give the business a competitive advantage over its rivals as most of the competitors outsource for design and maintenance services. Also, most entrepreneurs cede management roles soon after take-off leaving the venture in danger of stagnation/collapse. Low Cost fees-According to Dynamic Business, the demand for e-business is likely to grow by 21% in 2018, yielding a total of more than $ 25 million in terms of market value. Last year alone, the number of online consumers grew by 7% and the figure is likely to hit double figures by the end of this year (Dynamic Business, 2016). The same report projects that businesses with no strong online presence will experience a sporadic downfall by 2020. However, one major undoing is the cost of starting up new e-business ventures. From designing a functional website to marketing, prospective entrepreneurs are finding it hard to balance between the input and output. Low cost fees will give the e-commerce website a competitive advantage but attracting many small scale business with low subscription fees as opposed to other e-commerce website that charge exorbitant prices. Having full time technicians will make sure the website runs at optimal level and avoid costs associated with outsourcing for experts. Task 2 Potential Security and Fraud Threats Amid the technological evolutions that increase demand for ecommerce, there is also a growing trend of online insecurity and fraud that endangers businesses more so online businesses (Niranjanamurthy & Chahar, 2013): Data Interception-Confidentiality is key in any online business as it enables the customer to transact in an environment where there are no flaws. Data interception is rife in the online business and it involves an attacker monitoring the flow of data in and from the website with the motive of altering it (Saini., et al, 2012). The information gathered can be used to execute another attack of higher magnitude. This alteration can come in terms of monitoring the communication cycle between a client and the company and then modifying it to create a different impression or direct it to the wrong recipient. Hacking-Hacking is the commonest form of cybercrime that poses a threat to e-commerce websites. Hackers usually target payment transactions and use high tech approaches to log in and withdraw cash without the knowledge of either party. Hacking has grown into a full blown practice and today, many hackers are scattered across the online market with specialization in dismantling the security mechanisms installed by companies to ensure secure shopping (Tikk, 2011). In some cases, hackers harbor the motive of bringing businesses down by portraying them as insecure and unreliable. Credit/Debit Card Fraud-Online payments present businesses with the biggest security threat. Online attackers are increasingly targeting card details of customers and then stealing the passwords with the ultimate aim of transacting without the owners’ knowledge (Lumpkin et al., 2002). Card fraud is the most common type of hacking that can instantly dent a business’ reputation. Especially for new ventures, such fraud is detrimental and ought to be prevented at the earliest stage possible.to assure customer of their privacy and security. Mitigation Plan In order for the business to take off and operate in a secure environment that increases customer confidence, identification and prevention of security threats will be of high priority (Ha, 2011). As such, part of the business plan will include a clear and workable plan towards cushioning the venture from security threats. Assessment-Before the actual website goes on full operation, it is necessary to assess the market and identify the trends and data that summarize security threats (Saini al. 2012). Basically, this will involve identify the threats holistically and then narrowing down to my case. Evaluation-Depending on the magnitude of the threat identified from the previous phase, it is then ideal to evaluate the overall threat posed to the business as well as identifying other strengths that exist within the venture. Harnessing-Dealing with cybercrime is a process that requires substantive amounts of input in terms of finance. As such, this stage involves setting aside sufficient resources to combat the threat. Implementation-This is a culmination of the preceding stages and involves measures such as installation of firewalls, data encryption, advanced monitoring, backup and recovery, patching or security holes plugging (Ajam, 2016). Monitoring-Online security threats are on a rapid increase. Consequently, there is no room for relenting if the business is to surge through the storm and achieve the set goals. There will be routine monitoring that includes identifying newer threats and newer tactics of handling the problem (Luiijf., et al, 2013). This will also involve training and sharing intelligence to increase awareness among all stakeholders. Most importantly the e-commerce website will employ serves of Kaspersky, Norton or MacAfee to ensure the safety of the customers as well as keeping the website secure. References Azadi, S., 2011. strategies for competetive advantage in electronic commerce. EMAJ: Emerging Markets Journal, 1(2), pp.59-69. Ajam, N.H. 2016 Enhanced the Security of Electronic-Commerce (E-Commerce). Dynamic Business 2016.Retrieved from http://www.dynamicbusiness.com.au/featured/e-commerce-in-australia-demand-to-soar-in-2016-as-retailers-go-online-or-face-declines.html Ha, H., 2011, June. Security and privacy in e-consumer protection in Victoria, Australia. In IFIP International Conference on Trust Management(pp. 240-252). Springer Berlin Heidelberg. Luiijf, E., Besseling, K. and De Graaf, P., 2013. Nineteen national cyber security strategies. International Journal of Critical Infrastructures 6, 9(1-2), pp.3-31. Lumpkin, G.T., Droege, S.B. and Dess, G.G., 2002. E-commerce strategies: achieving sustainable competitive advantage and avoiding pitfalls.Organizational Dynamics, 30(4), pp.325-340. Niranjanamurthy, M. and Chahar, D.D., 2013. The study of e-commerce security issues and solutions. International Journal of Advanced Research in Computer and Communication Engineering, 2(7). Saini, H., Rao, Y.S. and Panda, T.C., 2012. Cyber-crimes and their impacts: A review. International Journal of Engineering Research and Applications,2(2), pp.202-209. Shin, N., 2001. Strategies for Competitive Advantage in Electronic Commerce. J. Electron. Commerce Res., 2(4), pp.164-171. Tikk, E., 2011. Ten rules for cyber security. Survival, 53(3), pp.119-132. Read More