WTS Migration Plan To Develop E-Business Capability - Essay Example

27-08-2006 WTS Migration plan to develop e-business capability "Electronic commerce is often thought simply to refer to buying and selling using the Internet; people immediately think of consumer retail purchases from companies. But e-commerce involved much more than electronically mediated financial transactions between organization and customers. Many commentators refer to e-commerce as all electronically mediated transaction between an organization and any third party it deals with. By this definition, non-financial transaction such as customers' requests for further information would also be considered to be part of e-commerce. (Chaffey, 2004). E-business or e-commerce refer to the technology/ system integrate with commerce i.e. purchase of goods and services over world wide web via secure servers with shopping carts and with electronic pay services like credit cards payment authorization. Impact of e-business on organizations is happening right before our eyes a vast and rapid reconfiguration of business on an unprecedented scale. Impact of e-business on organisation could be classified as follows: On employees: Due to advent of e-business employee is getting new places and areas to work. Employee's turnover is increasing; they have flexibility of working time. Incentive and reward systems becoming team oriented as well as working becomes knowledge intensive which necessitated organisations to have permanent educational and training system. On strategy: Organisations have to orient towards virtual as well as real markets. Organisations strategy and IT strategy must lineup and penetrate each other more and more. On Processes and structure: Due to IT induced reengineering, improvement in business processes is evident. Decreasing intensity of regulations, reduction to hierarchical levels, decentralization of decisions, task enrichment, team oriented structure and growing importance of knowledge management are the impacts of e-business could be visible on organisations. On Organizational culture: Due to e-business people of different culture and nationality are coming around. Different values, ethics, styles are mixing up results in an own young dynamic communicative responsible organizational culture is developing. On IT infrastructure: Due to e-business organisations internal and external orientation requires the solution to security and standardization problems. It facilitates deeper penetration into suppliers and customers. It leads to system integration and established itself as independent unit. IT implementation process: E-business facilitates Bottoms-up-approach instead of Top-down-approach and participation of concerned employees becomes necessary. Economic benefits: E-business has comprehensive IT-penetration in every business processes therefore results in speeding up the process and information. On Suppliers, competitors: it developed relationship with suppliers as equal partners and partnership with competitors became possible. On customers: It has greater impact on customers. They are integrated with the whole business processes and individualization/personalization of lasting customer relationships is the hallmark of e-business. Impact of e-business on almost every part of the organisation is evident. Choosing the important infrastructure i.e. appropriate technology and service provider is of utmost importance. Service providers and IT groups directly affect the value of the enterprises. E-business needs whole lot of infrastructural change. The technical infrastructure element of e-business consists of Internet and server technologies, hardware and software. Apart from the infrastructure needed for any business i.e. man, money and machine, e-business needs some specific infrastructure to succeed which are known as business application infrastructure which supports e-business design by providing the software functionality required for the business design to work. E-business infrastructure, which has been needed by WTS, could be classified as: Customer relation management: it includes customer content, customer contact information, end-to-end process, the extended enterprise and the system. Enterprise resource planning: It is a technical backbone of e-business. It integrates the complete system i.e. sales order processing, inventory management and control, production and distribution planning and finance. Almost all the organisations embrace ERP software. Enterprise application integration: modern business designs are constructed from well-integrate modular building blocks called enterprise applications which provide a common platform for ERP, CRM and SCM (supply chain management). Online selling chain: it includes infrastructure like Internet relationship management includes order entry and management, sales configuration systems, product catalogue and marketing encyclopedias, pricing engines, proposal/quote generation system and sales compensation systems. E-procurement: The end-to-end procurement process comprises three separate workflows: the order workflow, the fulfillment workflow and the payment workflow. These processes need to be supported by customer services and backward integration of accounting. Business intelligence: it includes infrastructure such as data/content of organisation and collection, analysis and segmentation of market, real-time personalization of customers, broadcast, retrieval and interaction of services/information and performance monitoring and measurement of e-business. Supply chain management: it is a real-time infrastructure combined with ERP system to integrate functions such as purchasing, inventory management, production scheduling and finance. However, infrastructure is much more than technology. It is the dynamics interaction and management of strategy, skilled people, tools and processes. People (employees) should play a major role in e-business success. E-business opened a whole lot of options to organizations and provided numerous benefits to customers as well as to organisations. Speed: E-business increases the speed of services. Every organization is trying to be instant, accurate and adapting responsiveness to customers needs. One stop shopping: Putting together is buyer, sellers and product on one platform and convenience in one-stop shopping is one of the benefits e-business provided us. Integration: E-business went for better integration of the order entry, fulfillment and delivery cycle. Personalization: In e-business personalization of customers is one of the best options, which it has provided to customers. It also satisfies the customers' psyche. Customers: Today's technology provides organizations, the ability to understand precisely what customers want and made to their specifications. Prices: Due to advent of e-business prices to suffered a lot. "To affordable" is meaningless. Organizations that offer unique services for a reasonable price are flourishing, benefiting from a flood of new buyers. Information: E-business also improved communications, information and knowledge sharing. Reduction in inventory cost: It also resulted in the reduction in inventory of the organization. Harmonization and standardization of practices: Harmonization and standardization of practice is becoming more and more common. Transfer of best practices: E-business facilitates the organizations to transfer best practices in between. It improves efficiency and productivity of the organizations. Expansion and reach: E-business increased the reach of organizations across various cultures, communities & countries. It has increased acquisition of new customers and sales as well as improved customers' services. Value: E-business provides value to customers. It offers responsive, user friendly purchasing experience; provides incentive to customers', sales promotion, advertising, sense of community, soliciting customer input and loyalty programmes etc. Benefits of the organizations could be measured with respect of increase in sales volume and profits earned. Every organization must evaluate different aspects of e-business on the basis of Return on Investment (ROI) and Return on assets. Benefits could be measured by the capability of retention of customers as well as addition of new customers. It could also be measured through the value of transactions specifically high value products, online sales etc. Risks likely to be faced by organisation willing to start e-business: Every business has certain amount of risks but e-business have some specific risks. Reliability: E-commerce vendors must be truthful about its products and its specifications, availability, shipping reliability and handling complaints promptly and effectively. If once organisation fails it faces permanent negative impact on business. Fail to understand customers: Every organization in e-business must have the risk of failure to understand customers, why they buy and how they buy. Organizations do not understand customer habit, expectations and motivations. Wrong market assessment: Organizations fail to assess market competitive situations. They may be unable to predict environmental reactions. Unrealistic assessment of organisation capability: Overestimation of staff, hardware & software and processes to handle tough business situations. Lack of Training and development: Organizations may fail to develop employee management skills. Lack of coordination: Organisation may have the organizational structure, which may or may not aid to coordination between different systems. Lack of senior management commitment: Organization fails to obtain senior management commitments to e-business, results in a failure to gain sufficient resources to accomplish tasks. Employees' commitment: Employees' commitment is one of the major risks involved in e-business. Resources and planning: Setting of e-commerce/business venture needs more time, money and perfect planning based on thorough analysis of organization environment, resources available etc. Organized cyber crime: The risk of organized crime on e-business became imminent. Different laws and regulations: Different regulations about auctioneering, professional selling, distance selling, banking, money transaction and legal system pose greater risks to e-business. Different distribution channels, employee/employers relations, cultural ambivalence towards or non-acceptance of on-line trading, Different accounting practices, longer, payment cycles, higher telecommunication and ISP costs, strong local competitors, consumer protection laws, tax laws, profit repatriation, restriction on foreign currency exchange, intellectual property laws are also some of the risks that e-business organizations are facing today. Plans to minimize risks: Proper planning: Planning have to be done carefully, keeping in mind the pre and post market survey about consumers needs, preferences, liking etc. Competitors: Competitors' strength and weakness to be analyzed carefully. Resource analysis: Organizations resources, work force skills to be analyzed properly. Product suitability: Product suitability has to be analyzed because some products and services are more suitable for e-business. Structure: There must be an integrated end- to- end approach and system structure must be flexible. Senior management involvement: Sr. Management must be involved right from the start so that resources must be allocated to accomplish tasks. Employees' consent and commitment: Employees must be provided the whole picture of change and taken into confidence to accomplish tasks. Use of scientific tools and techniques: Basic project planning has to be done by using scientific tools such as critical path, critical chain, PERT analysis etc. Management of change: Change management is the key to achieve success in e-business. So organization, that have ability to attract buyers and sellers, customers, service and brand recognition, system reliability for delivery and payment, website convenience and accessibility procedure and selection of goods, community cohesion, interaction and size must bound to succeed. Reference: 1- Chaffey, D. (2004), E-business and E-commerce Management (2nd edition) Pearson education Inc. 2- Kalakota, R. & Robinson, M. (2005). E-business 2.0 Road map for success, Pearson education (Singapore) Pte. Ltd. 3- accessed on 25/8/06. Read More