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IT6305 e-Business Applications eCommerce Business Strategies
Upekha [email protected]
Strategic Management Process Strategy - a course of action,
including the specification of resources required to achieve a specific objective.
Concerned with the Decisions Enhance the Competitiveness
Scope
TimeCost
A Strategy
“Based on current performance in marketplace”
“Defines how we will meet our objectives”
“Sets allocation of resources to meet goals”
“Selects preferred strategic options to compete within a market”
“Provides a long-term plan for the development of the organization”
No e-Strategy?
Missed Opportunities Inappropriate Direction Isolation of information in different
systems. Resource wastage
eBusiness Strategy Development Step by Step
Planning• e-
Business strategy
• Implementation plan
Implementation
Operation
Planning
What type of eBusiness?
Why you want to developthat type of e-business ?
How to develop the
chosen eBusiness type?
eBusiness
Strategy
Implementation Plan
Propose Your Future Situation Should be specific (time and figures)
Profit Oriented (Improve Revenue Models)
Cost Oriented (Be efficient) Client Oriented (Improve customer
services)
“Increase revenue by 30% in 2 years”
“Reduce cost by 20% in 1
year”“Increase client satisfaction by 50%
in 2 years”
To be a First Mover rather than a Follower?
ADVANTAGES Chance to capture
large markets Establishing a
brand name Exclusive strategic
alliances
DISADVANTAGES High Cost Chance of failure is
high System may be
obsolete No support services
at the beginning Competitors may
follow the strategy quickly
SWOT Analysis
Internal Factors
Strength
Weaknesses
External Factors
Opportunities
Threats
(2009 - 2015) Case Study is given to carry a SWOT Analysis
SWOT Analysis
What is your business sector? Who are the customers? What are the current practices of selling
and buying? Who are the major competitors?
How intense is the competition? What e-strategies are used, by whom? What are the existing and potential
partnerships for developing e-Business?
SWOT Analysis for a General Organization
Opportunities Easy Accessibility for global
market New trends Availability of B2B market
places
Threats Competitors
Strength Original product Popular product Reputation for high
quality
Weaknesses Lack of IT
expertise No WEB presenceIn
tern
al
Fact
ors
Exte
rnal
Fa
ctor
s
SWOT Diagram
Strength (S) Weaknesses (W)
Opportunities (O)
SO StrategiesGenerate strategies
here that usestrengths to take
advantages ofopportunities
WO StrategiesGenerate strategies
herethat take advantage
ofopportunities by
overcoming weaknesses
Threats (T)ST Strategies
Generate strategieshere that use
strengths to avoidthreats
WT StrategiesGenerate strategieshere that minimizeweaknesses and
avoid threats
InternalExternal
What should consider when joining with an eBusiness Portal
Benefits? Costs? Limitations? Marketing? Infrastructure? (Sell side & Buy side) Which portal to join?
Identify Organization’s PositionSurvival -Companies in deep trouble
and need re-engineering, they have no choice.
Sustainability - Not yet in trouble, but, has the foresight to see trouble coming. They need to be proactive.
Growth - Ambitious and aggressive. Reengineering is an opportunity to further their lead over the competitors.
Critical Success Factors which give the Competitive Advantage
Effective BusinessProcesses
Hig
h Q
ualit
y
On
tim
e D
eliv
ery
Com
peti
tive
Pr
icin
g
Hig
h Pr
oduc
tivi
ty
State-of-the-Art Technology
SWOT Analysis
Cost – Benefit – Risk Analysis
Porter’s 5 Forces
Analysis
ûVirtual Colloboration
Business A
Information
Business B
Information
Business C
Information
Virtual Organizat
ion
Customer
Customer
Customer
For SME, is it difficult to trade internationally? When a small company plans to import or export
products for the first time they often face a range of complicated procedures, regulations, legislation and other barriers.
Small companies with 5-10 employees do not have the resources to support a dedicated foreign trade department
As a result, many SMEs feels trading internationally is very discouraging. They may be forced to use an external consultant (very
expensive) or lose a potentially valuable business opportunity.
Global Trade Platform for SMEs
An Innovative Global Trade Platform For SMEs, Giordana Bonin
Ref : https://books.google.lk/books?id=TzUYxvwW51EC&lpg=PP1&pg=PA1380#v=onepage&q&f=false An Innovative Global Trade Platform For SMEs, Giordana Bonini
Often LOCs that are compiled by hand/manually often contain errors. GTP will facilitate the exchange of LOCs using traditional paper documents as well as by electronic means.
Architecture System architecture is based on modules that will
allow a range of actors from the foreign trade value chain to integrate with the portal. Involving different types of users such as import and
export companies, banks and other foreign trade sector operators
The service providers (transport and logistics companies, credit institutions, insurance companies, lawyers/legal consultants, foreign trade advisors, inspection institutions, forwarding agents, customs offices/agents, public authorities, financial institutions, etc.) can dynamically integrate to the platform through on-line interactive web tools.
Architecture Allows participant companies that use any kind of
application software to be easily integrated with the system. (From web services which uses XML)
High level of flexibility where features can be either be partly or wholly used.
Well organized portal and contents are clear and precise.
Provide effective support to companies who wish to trade internationally.
The main characteristic of this managerial software is the integration into a unique technological platform of all the actors involved in the import/export cycle.
Characteristics It is an innovative web based portal
dedicated to foreign trade Provides solutions to the major problems faced
by organizations when they are carrying out import/export transactions.
GTP is for SMEs who intend to start or expand international trade activities by guiding them through the stages of importing or exporting a product and highlighting any relevant regulations and taxes that apply.
It allows organizations (SMEs) to manage and carry out their B2B transactions on the Internet
Characteristics
It is a easy to use support tool to improve SMEs foreign trade activities because it fully integrate the foreign trade value chain.
Through a user-friendly interfaces, the portal supplies both the types of SMEs; who wish to start trading internationally as well as those who want to enter new markets.
Business Processes Facilitate Includes the business processes involved
in the import-export cycle. This web based portal supports the SMEs to
manage the whole import/export process by integrating all the steps from order to payment to delivery.
Deal with all the information regarding taxation calculations and details of service providers necessary to carryout a foreign trade transaction.
It also includes order confirmation, price determination, digital transfer of documents, agreement of the transaction’s terms and conditions, and selection of service providers.
Success Factors Should be based on state of the art
technologies as well as intelligent technologies. Should incorporate all the necessary security
features to achieve data protection, integrity and security.
It should not be just a simple marketplace. Should be easy to use to retrieve information,
especially by non expert users such like SMEs. Should include following major functional areas;
marketing, legal, informatics, international payment and logistics.
Features Offer buyer/seller contacts and related
information to obtain the best available offer.
Intelligent systems that highlights the most competitive service providers
Calculate total price for a product when it arrives at the export destination taking into account charges such as insurance, freight, import taxes, port fees.
Features Users can obtain export advice on the tax,
customs duties, legal and administrative requirements for a specific product depending on the country of origin and destination.
The exporter/importer can select relevant delivery and payment terms. Facilities to negotiate and manage different
payment methods and manage foreign exchange. Produce and manage all the necessary
transport documents Easily manage shipment requests
Value Addition
Could provide number of value added features(negotiation and consultancy) that will attract and retain SMEs and allow suppliers to gain market access and reduce transactions costs by ensuring the transparency and security of international transactions.
Additional facilities include such as e-learning facility to learn the process, foreign trade related discussion forums.
Value Addition
Facilities to overcome language barrier Support from an online export guide
containing export assistance, operational tools, financing, information sources and commercial information about potential foreign customers.
Consultancy support to help organizations overcome the key barriers which prevent them from entering to the international markets.
Security Need high security environment both physical
& digital. Digital security mechanisms should be
properly in place (protocols [HTTPS/ SSL], encrypted information transmission, password protection, user id system, digital signatures and acquire necessary digital certificates.)
CIA Features in Digital Security Confidentiality – ensure that information is not
accessed by unauthorized parties Integrity – ensure that information is not altered by
unauthorized people in a way not detectable by authorized users
Authentication – ensure that users are the people they claim to be
Security and Data Protection Security is an important issue for the successful
implementation of the portal. To guarantee the maximum level of trust, the
system should take the necessary measures to ensure both high performance and system protection. Digital signatures and proper mechanisms to allow
users to manage and exchange electronic documents. (in order to certify the validity, the authenticity and the ownership of any document transmitted over the platform)
Security of the sensitive data
Benefits to Seller / Manufacture The SMEs get virtual participate in bigger global
market. Could be a global provider easily. No marketing needed individually Improve the competitiveness of exporters
involved in foreign trade Facilitate exporters to create and publish their
product catalogue online, thus increasing their company visibility.
With dashboards which display current customer order status, new orders, new quotation requests, previous orders.. etc., exporters can easily get an overview of their business performance.
Benefits to the Buyer One stop shop concept Users can obtain a list of approved suppliers as well
as competitive service providers who can provide the necessary export services such as shipping, hauliers, insurance, etc.
Importers can request a price quotation for the displayed products and once the offer request is received, exporters can generate a counter offer through the portal.
Facility to posting an offer and carry out the international sale contract in a coordinated manner which conforms with international legislation.
Benefit Areas Costs Savings
Portal provide the most competitive quote from a range of service providers.
Portal simplifies the international trade process. Reduction in the risk related to the loss or delay
documents Savings in customs costs because goods will remain
in customs for a shorter period of time. Time Savings
Enable users to speed up the exchange of documents and streamline their foreign trade business processes.
Benefit Areas Reduction of errors
Platform supports the secure integrated and coordinated management of documents necessary for the execution of any foreign trade transaction.
The system ensures the authenticity and accuracy of every document exchanged online.
In particular users will be able to create, amend and change LOCs online, thus reducing the costs of using external consultants to prepare and dispatch such documents.
Another major benefit is achieved in the reduction of errors in LOCs missing documents or delays in presenting the correct paperwork which were often experienced by importers and exporters.
Conclusion
GTP will provide an important contribution because it meets a large number of identified user needs and provides a complete export service to SMEs
Provide importers/ exporters with the contacts and references to obtain the best available offer and to better integrate the value chain of their import/export operation.
2014, 2013, 2011, 2009 – 2. a) Illustrate and describe the benefits of the following eBusiness models to the manufacturer/seller and the customer separately.
i. Global Trade Platform for SMEs(20 Marks)