Week 4 Questions - E-Business

1. What is an IP Address? What is its main function?

Internet Protocol or Transmission control protocol is a numerical label the basic protocol of the Internet. It can be used as a communications protocol in a private network. Each computer on the Internet has an IP address, however every address must be unique. IP has two functions: Network identification & location addressing[1]. Eg of IP, 203.19.80.0.

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[1] “IP address”, available at: http://en.wikipedia.org/wiki/IP_address. Accessed: Sunday 14th March 2010.

2. What is Web 2.0, how does it differ from 1.0?

Web 2.0

A two-way web, data is no longer controlled by one person such as web 1.0 and individuals become more involved. Web 2.0 links users through social networking such as MySpace (www.myspace.com), Facebook (www.facebook.com) and Twitter (www.twitter.com)

Web 1.0

Controlled by one person and is a one-way flow of information through websites which contains read-only material such as Britannica online. However, web 2.0 such as Wikipedia http://www.wikipedia.org/, users can collaborate and build their own information.

Web 2.0 is a transformative and innovative force that is motivating companies towards an innovative way of doing business. Businesses are able to access critical business information for employees and customers through the interactive use of web 2.0. The Government New Grocery Watch is good example of Web 2.0 being used effectively.

Web 2.0 consists of:

Tags – metadata, allows us to build metadata. http://www.youtube.com/watch?v=aef0Y1B0C7A&feature=related

Blogs & Blogging – a webblog or online diary for the user to express feelings, thoughts or opinions. This is now heavily used in education.

RSS – Really Simple Sydnication – live stream of data coming in from other websites. A website that contains links and connections to other websites on one page, so the user is able to access many websites through an individual web page. eg www.ninemsn.com which has links to weather, sports etc.

Wiki – a site where anyone can post material, http://www.wikipedia.org/. This video demonstrates how to post material/edit on wikipedia http://www.youtube.com/watch?v=EOp1BKwuTs0

3. What is Web 3.0?

Web 3.o uses the concept of tagging to build information about your character and intelligence. Web 3.0 is turning Internet into database the way they’re doing it is through metadata eg facebook, where one can tag others in a photo.

Semantic web encompasses the following:

1.Transforming the web into a database

2.An evolutionary path to artificial intelligence à evolution is where something evolves slowly.

3.Search for information using different medias

4.Evolution toward 3D

This video shows the Future internet: Web 3.0 http://www.youtube.com/watch?v=off08As3siM

4. Describe the different methods an organisation can use to access information

Three different ways:

Intranet - A private section of the Internet to link various systems of an organisation, these include; HR forms, collaboration tools.

Extranet – accessed by authorised external users. Where organisations can invite other firms/strategic partners, those along the supply chain eg producer, retailer, manufacturer to share data easily and access organisation information.

http://www.edo.ca/files/cando/cando-extranet.jpg

Portal- is a Web-based, personalized gateway to information and knowledge that provides relevant information from different IT systems and the Internet using advanced search and Indexing techniques. An Internet site providing access to other links is www.msn.com all the external data comes from separate systems. Organisations tailor the website to the needs of each unique user.

5. What is eBusiness, how does it differ from eCommerce?

e-Business is the conducting of business on the internet, not only buying and selling, but serving customers, collaborating with business partners, marketing, clearance of money, and taking of funds.

e-Commerce is the buying and selling of goods and services over the internet eg ebay. www.ebay.com

http://cordis.europa.eu/ictresults/image-gallery/200307/1365_001.jpg

6. List and describe the various eBusiness models? (Hint: B2B)

e-Business model is an approach to conducting electronic business on the internet.

B2B – Business to business applies to businesses buying from and selling to each other over the Internet.

B2C – Business to consumer applies to any business that sells its products or services to consumers over the Internet.

The main difference between B2B and B2C is the customer and hence, the marketing is different.

C2B - Consumer to business applies to any consumer that sells a product or service to a business over the Internet. This can be done through forward actions (E-bay), reverse auctions as time goes along a products price gets lower.

C2C – Consumer to consumer applies to sites primarily offering goods and services to assist consumers interacting with each other over the Internet. Example ebay. www.ebay.com

B2b is the dominate model by 80% of all models.

7. List 3 metrics would you use if you were hired to assess the effectiveness and the efficiency of an eBusiness web site?

Interactivity measures the visitor interactions with the target ad.

The three metrics are:

Cookie a file on a hard drive by a website containing information about customers and their web activities

Click through a count of the number of people who visit one site and click on an advertisement that takes them to the site of the advertiser.

Banner ad advertises the products and services of another business, usually another dotcom business.

8. Outline 2 opportunities and 2 challenges faced by companies doing business online?

Benefits

e-Business is highly accessible – Businesses can operate 24 hours a day, 7 days a week, 365 days a year. Therefore customers can access their webpage any time of the day from all around the world.

Improved information content – in the past customers had to travel to a facility to receive information on pricing and quality. Now, electronic catalogues are available and web pages present customers with updated information about goods and services.

Challenges

Increased competition – customers are able to access different businesses that serve the same function by a single word on a search engine. This makes industries more competitive as customers can access a variety of businesses.

Protecting consumers – consumers must be protected against illegal goods or services and if they are purchasing through a specific web page, consumers must be protected against money fraud

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[1] “IP address”, available at: http://en.wikipedia.org/wiki/IP_address. Accessed: Sunday 14th March 2010.

Week 3 Questions - Strategic Decision Making

1. Define TPS & DSS, and explain how an organization can use these systems to make decisions and gain competitive advantages

TPS is a transaction processing system, which is used at an operational level (analyst). An example is a payroll system. Organisations use transactional information when performing operational tasks, repetitive decisions such as analyzing daily sales reports to determine how much inventory to carry. A business needs to ensure it carries sufficient inventory on a daily basis as excessive or limited stock can cause the business to loose revenue and potential sales. TPS today are moving to an online transaction process capturing the transactions immediately and processed through a system where this valuable information can be stored for business use. Thus businesses can use these systems to make decisions through the available information online which can lead to a competitive advantage of the business through the availability of the system.

http://www.wincor-nixdorf.com/internet/cae/servlet/contentblob/380964/publicationFile/6560/CkeckCashDeposit.jpg

DSS is a decision support system, which serves to support managers and executives during the decision-making process. DSS help managers make decisions, in relation to more complex problems, so called unstructured or semi-structured problems. TPS supplies transaction based data to the DSS. A decision support system is used at a strategic level where executives and managers use the information processed from transactions to provide analytical information. These decisions can include: estimating the sum of future cash flows from the use of assets, or preparing an operating budget for the next 5 years. This can allow a business to gain competitive information and become organised by making these decisions for the future of the organisation using current transactional information. Furthermore, a business is able to create innovative products or services or change existing services to suit future trends or problems by referring to a decision support system.

http://engmba.wdfiles.com/local--files/information-systems/a1.jpg

2. Describe the three quantitative models typically used by decision support systems.

1. Sensitivity Analysis: is the study of the impact of changes within one or more parts of the DSS model and the effects this has on other parts of the model. Eg how sensitive is our firm to a tax rate, what would be the increase in the cost of staffing?, what would our revenue be?

2. What if Analysis: determines the impact of a change and the effect this might have on solution. Modeling current situation, if changes are made how will it affect the business.

What will happen to sales as the price and quantity of units sold changes?

3. Goal- Seeking analysis: determines the desired output for a goal and finds inputs necessary to achieve the goal. Eg if we change the number of dresses we sell from 45-93 how will this affect profit?

to To determine how much money a person can borrow with an interest rate of 5.5% and a monthly payment of $1,300.

http://en.wikipedia.org/wiki/Decision_support_system

3. Describe a business processes and their importance to an organisation.

A business process is a set of standardized activities that help accomplish a specific task such as processing a customer’s order.[1] Business process is important to an organization as it allows a business to examine faults in an activity and ensures the process is running effectively and efficiently. Developing a reasonable process will allow goal achievement for a business.

4. Compare business process improvement and business process re-engineering.

Business process improvement attempts to understand and measure the current process and make performance improvements accordingly. [2] An example of improvements within business process is innovative technology such as Internet and wireless, allowing a business to further improve and advance communication within an organization. Examining a business process helps a business eliminate duplicate activities and combine related activities to ensure a smooth running of the process.

Business process re-engineering (BPR) redesigns a process or activity that currently isn’t working or needs improving. By improving and reinventing a process it allows a business to improve ideas and focus on new strategies to perform a process, which is up to, the standards of customer needs and wants.

In essence, both BPR and business process improvement are inextricable, they are steps in order to improve and enhance a business process, business process improvement can identify the steps needed to refine a procedure while BPR is applied to redesign a process improving its cause. Furthermore, businesses gain a competitive edge when they minimize costs and streamline their business process using BPR.

5. Describe the importance of business process modelling (or mapping) and business process models.

Business process modeling is the activity of creating a flowchart or process of map of a work process, showing all activities, inputs and tasks in a structured sequence[3].

Business process modeling show process details in a gradual and controlled manner.

A business process model is a graphic description of a process, showing the sequence of process tasks, which is developed for a specific purpose and from a selected viewpoint. [4]

The As-Is process models represent the current state of the operation that has been mapped, without any improvements or changes applied

The to be- process model shows the improvements and changes into the process that have been applied.

The importance of a process model is to identify sequential processes within an activity and improve the model continuously, ensuring the efficient and effective use of these goals are accomplished. It also allows a business to identity the time taken to complete an activity, decide whether there are steps missing to complete a process more effectively and efficiently.

http://bpmfundamentals.files.wordpress.com/2009/04/contextdiagramdfd.jpg

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[1] Business Driven Information Systems

[2] Business Driven Information Systems

[3] Business Driven Information Systems

[4] Business Driven Information Systems

Week 2 Questions - Information Systems in Business

Explain information technology’s role in business and describe how you measure success?

Information technology encompasses organisations everywhere. Information technology plays a vital role in managing and processing information within an organisation. Technology supports and aligns itself with strategic direction of organisations. Information technology can lead to business success and innovation if individuals use and manage it effectively. Information technology influences major functional areas within the business such as marketing, operations & HR. It enables them to enhance communication between each other and further improve business activities. Thus, generating growth and productivity for the business.

To measure success in a business; you need to have constant awareness of IT performance, the contribution of IT to business success and further opportunities for improvement are all crucial in measuring success of a business.

The two key performance indicators in measuring success are:

1. Efficiency IT metric which measures the performance of the IT system, i.e. using resources at its optimal level. These include throughput, speed, system availability, information accuracy, web traffic, and response time.

2. Effectiveness IT metric measures the impact IT has on business processes and activities, i.e. the goals and objectives of the business. These include customer satisfaction, usability, conversion rates and financial.

Benchmarking is another way businesses can measure IT success, that is comparing past and present results constantly and identifying the steps and procedures to improve system performance.

Video: http://www.metacafe.com/watch/4061465/key_performance_indicators/, Key Performance Indicators.

List and describe each of the forces in Porter’s Five Forces Model?

http://kelas.files.wordpress.com/2009/10/porters-five-forces-model.jpg

Video: The five competitive forces that shape strategy: http://www.youtube.com/watch?v=4R60P_KeA44

Porter’s model can help a business:

- Identify potential opportunities

- Create a competitive advantage while discouraging potential rivals.

- Identify how attractive an industry is

1. Buyer Power

Buyer power is high when buyers have many sellers to choose from.

Buyer power is low when buyers have a few sellers to choose from.

A company can reduce buyer power by introducing loyalty programs (incentives) to attract customers and reward them based on the amount of business interaction within the organization and thus can create competition between industries.

2. Supplier power

Supplier power is high when one supplier has a concentrated power over an industry. When supplier power is high, suppliers can influence an industry by:

- Raising prices

- Limiting quality or service

These are passed onto their buyers, however buyers can lose revenue as they may not be able to pass these changes onto their customers. Therefore, suppliers will benefit by having concentrated power over an industry.

3. Threat of substitute products or services

The threat of substitute products or services is high when there are alternative products or services such as butter, spreads and margarine. This can lead to high competition between industries.

The threat of substitute products or services is low when there are a few substitutes alternatives for e.g. specific medicines or medical equipment.

Markets become competitive, as technology such as internet can make industries less secure as there are many substitutes, and customers can use the internet to research other available products which can increase competition.

4. Threat of new entrants

Threat of new entrants is high when competitors can easily enter a market and low when there are significant barriers to enter a market eg telecommunications industry, where threat of new entrants is low.

5. Rivalry among existing competitors

High when competition is fierce in a market and low when competition is more complacent.

Switching costs is a way to reduce rival power. These costs can make customers reluctant to switch to another product or service.

A unique product is another way to reduce rival power but creating products that are different then competitors’ products.

Describe the relationship between business processes and value chains?

Value chain analysis determines the success or failure of a strategy chosen in Porter’s three generic strategies.

Business process is a set of activities that accomplish a task in business such as processing customer order. To evaluate the effectiveness of a business process an organization can use a value chain approach. This examines the processes of a task and then identifies the activities, which adds value to the product or service for the customer such as offering discounts. In essence, this value chain approach will improve a specific process and increase customer satisfaction and growth for the business.

http://www.provenmodels.com/files/2825c320f5910a4647fd289cdcf5a780/value_chain_analysis.gif

Compare Porter’s three generic strategies?

http://www.marketingteacher.com/IMAGES/porter_generic.gif

Once an organization has determined the market they wish to enter they can choose three generic strategies.

1. Broad cost leadership – which is focusing to target a mass market. It is aiming to be the cheapest and produce the most.

2. Broad differentiation – establishing a unique product.

3. Focused strategy – targets a niche market focusing on either cost leadership or differentiation.