IT Systems for E-Enterprise - Assignment Example

What are the successes factors for e-business that you should consider when designing an IT system for e-enterprise? Introduction to e-business E-business is short for Electronic Business. E-business, in most the easiest understanding, is any enterprise that is available not only offline but also online. Businesses traditionally have not felt necessary to employ techniques to automate routine functions and to employ tactics necessary to reduce workload. The dependence has usually been on conventional means which is predominantly manual. Formally, e-business may be defined as the use of information and communication technologies in all business activities. Through Electronic business methods, companies can link their external and internal data processing systems more efficiently with greater flexibly. This allows them to integrate well with their suppliers and partners, and to cater to the needs and expectations of their customers in a more efficient way. Although e-business is very often confused with ecommerce, e-business is far more powerful than ecommerce. In fact, ecommerce can be a subset of e-business. Through e-business, a company focuses on using electronic communication and data storage means for all business activities, whereas, ecommerce seeks to develop a company’s relationships with its customers and partners through World Wide Web and Internet. With the advent of technologies many organizations have reduced the workload, labour and even the costs. This achieved by using enterprise-wide systems dedicated to integrate the company’s resources together and to add value to the overall organization. Some instances of these technologies include Customer Relationship Management, Local Area Network, Enterprise Resource Planning (ERP) and wide scope similar applications. Successful integration of information systems enables the companies to reduce operation cost, increase customer base, motivate employees and increase profits. This way, through e-business, a company has relatively a higher competitive edge over its competitors in the same industry or field (Laudon, K. C.; Laudon, J. P. (2007)). Need for e-business in an organization  Many organizations still feel incorporation of technologies and web is a daunting task especially when it comes to estimating returns on e-commerce. There are not enough metrics to apply in order to access the e-commerce returns. However, there are other companies that feel the incorporation of web and online methods will help them gain a position in the market with optimal edge over competitors in the same field or industry. They consider this as an investment rather than expenditure. With the rapid expansion in technology, the costs of adopting e-business technologies are coming down each day. This makes it very easy for any organization to acquire technologies and establish a competitive edge. Hence, even established organizations need e-business strategies to maintain their market position and competitive advantage. But still it is necessary to evaluate the pay offs of the investments in the e-commerce. In order to access the need of e-business in any type of organization C.E.Os of companies should consider three very important questions and these include: Why does the organization desire to employ e-commerce? The answer to this includes all the advantages that e-business will bring in the organization and the losses of not adopting e-business. What is the anticipated time required to reach break even with the e-commerce initiative? This requires complete calculation of the monetary benefits the company expects to receive from e-business and the timeframe that these will take. This should be compared with the cost incurred to determine the breakeven and return on investment. Who are the stakeholders? And how they are going to be affected with this e-commerce initiative. Stakeholders are individuals or group of individuals who are related to organization in any way. These would be the customers, suppliers, employees etc. The company should analyse how each of them would be affected by the incorporation of e-business (American Hytech Corporation). Role and benefits of IT systems in e-business   Even the most futuristic company owners have been surprised with the outcomes of the IT systems in their businesses. The literature of e-commerce has several instances of the successes as well as the failures of the Information Technology systems in e-businesses. It is important to determine critical success factors in order to successfully implement such systems at the work place. The number of e-businesses is increasing exponentially every year. Soon the incorporation of the e-commerce in the business will become a necessity rather than an option or choice for the companies. An enterprise e-business model can yield many benefits, these include less operative cost, less labour and labour costs, automation of manual work and most importantly the energy and time spent when doing manual work gets significantly reduce. Integral to success of an e-commerce is having an enterprise wide e-business system that can aid company to sell services and goods online and also help company to integrate its multi functions on one platform to make the equation clear. Such models can be customized by vendors (Clemons, E.K.; Kimborough (1986)). Success factors to consider  for e-business There is no questioning on the immense potential organizations have in today’s world to grow. Organizations are speedily reaching news markets, finding new customers, building profitability of the retained customers and then broadening the market share by tapping potential in the new markets. With this comes the great responsibility of taming organizations accordingly that is making organizations compatible with the needs of today’s markets that come with the immense competition, ever increasing inflation, cognitive dissonance and unforeseen circumstances. By taming organizations, I mean the organization must have recognition of its own, i.e. it should have a strong organizational culture that has no parallel and it should be able to attract a strong team that is ready to work zealously for it. One such way is incorporation of information technologies. No matter how stable e-commerce has made the industries in these challenging times, it does not guarantee survival of all e-businesses. Online shopping has its merits and demerits. A lot is invested in the brand to understand the need of the customer so later company does not face customer complaints and loss of goodwill but despite the huge investment, customers still face indecisiveness because he/she may not be sure whether the products colour, size or style is appropriate for them. There are many success factors to make sure the incorporation of modern technologies is going to help the company to yield maximum advantage for itself. Like mentioned earlier that incorporation of technologies is discouraged by companies as well as encouraged. The reason why companies discourage is because of the reliance and trust on the outcome of the manual work. They are hesitant to change and feel this is going to add to the costs. It should be clear that the outcomes of the web enterprise are not immediately clear. The pay offs on the e-commerce payoffs take time. Success factors and metrics should be applied to make sure that the e-business enterprise wide model is reaching the predetermined targets. Vendors offer ready made solutions or software, while some vendors can also customize software in order to meet the requirements of the enterprise. A collaborative and enterprise wide portal is going to help company integrate its various processes and functions, find the impact of each organization’s activity on all variables and sell products and services online reaching the customers in the remotest possible location. Success factors typical of any e-commerce can be grouped and identified as applicable to any enterprise. Strategic virtualization of any enterprise is there to meet organizational desired results. Transferring a previously an IT deficient enterprise into e-business is a difficult decision because that is a radical transformation whereas a new prospective business in any industry these days make changes and start virtualization at tactical level. Incorporation of information systems and implementation of e-business should be a result of a lot of deliberation and not forced compliance. When incorporating the organizations should be examining the companies current and the desired outcomes (Marc J. Epstein). Some success factors consider for e-business include: a) Combining Business Knowledge : It is important that the organization thinking on incorporating web technologies is resourceful and sufficient knowledge about the enterprise resources, supply chain, logistics, marketing, finances and procurement departments of the organizations. The business should be able to combine understanding of each independent discipline or function of the business. The company then should be able to review how each function contributes towards the organizations results and how each department is inter-dependent. This is often the preliminary exercise every organization does before they step out to implement e-business technologies. Often this is carried out by external consultants. Many a times, the companies have to undergo a thorough analysis of their business processes in order to have a detailed understanding of their value chain and to also identify the weak links. Understanding of the functions, processes and the inter-linkages is critical to success of e-enterprise. b) Value Proposition And Delivery Measurement : The e-business success largely depends on the value it adds to the organization. Value can be directly measured in monetary form or may be translated from intermediate measures such as productivity or efficiency. The incorporation of the information technology should be value adding to the functions of the organizations. The senior managers should question how IT is going to help the organization’s particular department or function, achieve desired result efficiently and promptly. Metrics should be applied to determine outcome and the deviation of the outcome achieved from the desired outcome. Such metrics make sure that the end result is a success and everything from planning to implementation is goal oriented. c) Customer Satisfaction And Retention A lot is put into organizational structure, culture and profile of its prospective employees and customers, for any organization to grow it should have a strong foundation and it should build up on the predefined foundations that have been laid. Organizations are speedily reaching news markets and finding new customers. The customer is a king is not only a mantra but reality. Customer retention is just as important. It is imperative for companies when they are incorporating Information Technology to realize whether they will be able retain their loyal customers. Although IT systems such as Customer Relationship Management are specifically geared towards building successful and strong relationships with the customer, the organization still has to ensure that every IT system should focus on improving the customer satisfaction. Even with highly sophisticated technologies and equipment, no IT project can be successful if the end objective is not to improve the customer experience with the organization. Hence, satisfying customers and retaining them is an important success factor for e-businesses. d) Monitoring Internal Factors: The internal metrics should monitor the processes in organizations. Organizations going online should establish internal metrics to estimate revenues, employees’ motivation, employees’ willingness and operation costs. Many a times, a critical factor to consider is the organization’s culture. Organization culture refers to the established values in the organization and the accepted ways of carrying out activities. This also comprises of the capabilities of the employees and their willingness and ability to adapt to change. With the implementation of an IT system in an organization, the organization needs to analyse whether the new system would complement the culture or would the culture cause hindrance in the successful deployment and running of the system. In many cases where the employees are not very keen in learning new methods and are reluctant to change, the IT system will not add any value to the organization. Hence, it is important to monitor the internal factors before designing and implementing an IT system in an organization. e) Monitoring Competitor Activity : All organizations face competition and make strategies to stay ahead of their competition. Moving towards e-business is also a major decision to acquire competitive advantage. However, the organization also needs to analyse what the competitors are doing. The business needs to consider the kinds of IT systems the competitor has and how they are managing their business and catering to the needs of customers. Based on this, the organizations should design its own IT systems to deliver even superior value. Consider a case where an organization puts in a huge amount of investment in acquiring and IT system. If the company has not analysed what the competitors are doing and the methods adopted by them, the new IT system may not enable the organization to get ahead of its competitors and the system might fail to deliver the desired results (Marc J. Epstein). f) Building Trust Finally building trust is highly critical for the entire e-business and its stake holders. Employees face a lot of trust deficit as they feel insecure with incorporation of technologies they have no experience with. Therefore, trust should be build and welfare of every participant in e-business initiative should be give prime importance. Many employees consider computers and IT systems to be a threat to their jobs rather than tools to improve their productivity. Hence, in the absence of trust and confidence, the employees will be reluctant to adapt the new technologies and will not be in a position to use it effectively. It is important that the organization trains the employees to develop trust and change their attitudes. g) Mode of Implementation Mode of implementation refers to the technique and methods adopted by the organization to deploy or implement the system in the organization. There are different means for implementing the IT system. At one extreme, the organization deploys the new system and immediately removes any existing systems. At the other extreme, the organization takes very long to roll out the new system and replaces the existing one. It is important that the organization analyses the situation and determines a suitable mode of implementation. Without adopting the right mode, the implementation of the IT system can be a total failure even if the system itself is very powerful (Marc J. Epstein). Conclusion   Organizations increasingly are developing IT systems and implementing them to become e-businesses. The need for IT systems in organizations is becoming stronger and stronger as technology becomes cheaper and more advanced. These IT systems enable organizations to save costs, become more efficient, gain competitive advantage and serve their customers better. However, the organization also needs to consider the factors which are critical in the success of any IT systems. Some of these factors include knowledge about the organization, the expected value from the IT project, and focus on customer satisfaction and retention. Also, the organization needs to analyse the internal factor such as its culture to determine whether the organization has the capability to make use of the IT system. Besides this, the mode of implementation of the IT system plays a critical role in the success of the IT project. Sources: 1. American Hytech Corporation. (n.d.). Why You Need E-business? Retrieved from http://www.ahc.net/subwhyyouneedebiz.htm 2. Beynon-Davies P. (2004). E-Business. Palgrave, Basingstoke 3. Clemons, E.K.; Kimborough (1986). "IS for Sustainable Competitive Advantage". Information & Management 4. Laudon, K. C.; Laudon, J. P. (2007). Management Information Systems – Managing the Digital Firm. Pearson Education, Inc. 5. Marc J. Epstein. Implementing E-commerce Strategies: A Guide to Corporate Success after the Dot.Com Bust. Westport, CT: Praeger Publishers, an imprint of Greenwood Publishing Group, Inc. 6. Paul Timmers, (2000), Electronic Commerce - strategies & models for business-to-business trading, John Wiley & Sons, Ltd Read More