E Bussiness Assignment

Q1. (a) E-business In India and developing countries INTRODUCTION E-Business is a revolution that is transforming companies round the world, and it is impacting all the industries. E-business is much more than online purchase and implementation of computer applications by the IT departments; or putting up a company website. E-business affects the whole business and the value chains in which it operates. It enables a much more integrated level of collaboration between the different components of a value chain than ever before. Adopting e-Business also allows companies to reduce costs and improve customer response time. Organizations that transform their business practices stand to benefit immensely from innumerable new possibilities brought about by technology. Although it's early days for e-Business in India, we believe there are greater opportunities over the long term for India and Indian businesses. There is urgent need to usher in farsighted policies & practices to become a major economic force in the emerging world of E-Business. With the growth of information technology worldwide, the use of Electronic business is gaining momentum day by day. The Indian scenario of information technology is as followsDevelopments: • As of September 2007, there was a PC base of 15.8 million PCs. • More than 80 per cent of stand alone PCs sold during last two years were driven by the need to access the Internet. • Ninety one per cent of India’s corporate web sites are located overseas The Internet and e-commerce industry employs approximately 82,000 people. These include web developers, web designers, system analysts, ISP infrastructure providers, marketing staff, e-software professionals, etc. It is projected that by March 2003, the Internet and e-commerce industry would employ over 300,000 people. • India has about 1.6 million households connected to the Internet

While the global economy is said to undergo profound changes as a result of impressive technological developments, in particular in the area of information and communication technologies (ICTs), little is know about the actual use of ICTs in businesses and their impact on productivity, firm competitiveness, trade and economic development, in particular in less developed countries. As the information society gains momentum, there is an urgent need for reliable data on ICTs and their application in business. India had one of the world's lowest levels of basic telephone penetration, or teledensity, in 2005, with just 4.5 main lines per 100 population. Mobile-phone use is, however, growing rapidly, and wireless subscriptions have now surpassed those of fixed lines. India's telecommunications sector is ripe for growth. Most segments of the Indian telecoms markets are still in an early growth stage. The mobile market in particular is in full swing, with penetration levels remaining below the presumed potential of the market. Broadband is still at an introductory stage The Government of India has long recognized the need for development of IT industry and information infrastructure as these are twin engines for growth of the economy. Deeper penetration of IT applications in the economy, and in the society as a whole can help boost the economy. E-commerce applications can make it easier for the country to better integrate with the global markets, the e-marketplace. This has led the government, over the last few years to formulate liberal policies for the development and growth of the IT industry. Emerging E-business areas in IndiaInternet application integration; Customer Relationship Management (CRM), Customer ServiceManagement (CSM), Enterprise Resource Planning (ERP) and Electronic Data Interchange (EDI) migration to web based models; new IT frameworks and integration with business strategy (strategic IT consulting); e-commerce training services, business web site development and maintenance. Factors catalyzing e-Commerce A large number of factors, of course, have contributed to this turnaround in e-Commerce fortunes in India. Besides a rapidly expanding base of Internet users in the country, technology changes and developments are also spurring e-Commerce by improving the interface between buyers and sellers and bringing them closer. Take the instance of the big buzzword, Voice-over-IP, which is addressing the interaction gap in e-Commerce by providing customers a direct access to

sellers, so that they can discuss information related to products and services. With VoIP, shoppers can talk to companies at the click of a button or chat free of cost to the seller, to close the sale. With VoIP, vendors are being able to convert their call centers to IP-based communications centers, thereby reducing their operational costs, while adding new services and features. The emergence of blogging, where retailers and e-Commerce vendors have started their blogs to provide information they could earlier not accommodate on their Web sites, is also helping companies expand their show-windows. Business blogs also help deliver products, services and information, besides serving as advertising and marketing tools and a source of feedback for enterprises. With fraud prevention technologies arriving on the scene, companies are now being able to provide a secure and safe business experience to buyers and sellers. Robust firewall and other technologies and helping prevent credit card frauds, identify thefts, check cheque frauds and phishing. By making the Internet a secure destination for conducting real business, new and innovative technologies are also revitalizing the e-Commerce movement across India. The e-Commerce scenario in India According to a 2005 Report brought out by the Internet & Online Association (IOAI), India’s Internet population has crossed the milestone 25 million mark and is expected to gallop to a 100 million by 2007. The Study also reveals the following:

e-Commerce transactions are expected to cross the Rs. 2300 crore milestone in 200607, a jump of around 300 percent from the 2004-05 figure of Rs. 570 crore the average number of online transactions has increased from 4.4 lakhs in 2004-05 to around 7.95 lakhs per month in 2005-06, a growth of a healthy 80 percent besides individuals, even businesses have been quick to embrace the Internet. Most organizations, including large and SME companies have a Web presence SMEs in fact, have found the Internet a viable platform for establishing their brand at lowered infrastructure and marketing costs India’s Tier II towns and cities are experiencing an increase in their online retailing activity and increased transactional values Clearly, the advantages offered by the Internet to Indian businesses are many. The Net allows companies to: address an ever rising population of online users access unlimited shelf space

remain beyond the boundaries of operational timings and geographic distances cater to countrywide city markets (for consumers and suppliers) at low costs deliver digital content online conduct online sourcing or public procurement Take the instance of a portal like eBay, which has enabled hundreds of smaller Indian companies and individuals to sell their products or procure them over the Net. At the level of individual buyers, the Internet and e-Commerce enables people to access a 24-hour shopping environment, where anything can be purchased from anywhere. The result is that consumers are transacting over the Internet and trading in goods and services, transferring funds electronically and availing of crucial Government services. Tracking the growth of e-Commerce Recognizing the growing buzz around e-Commerce in India, NASSCOM recently organized a seminar on the subject, highlighting the fact that online commerce was the way to go in the future. Speakers, representing the vast diaspora of e-Commerce vendors in the country, spoke about how the Internet was transforming businesses and changing the way products and services were marketed and delivered in the digital age. Placing the issue in perspective, Gautam Thakar, Country Manager of eBay said that consumers were trading goods worth almost three crore rupees everyday, across the globe. “Following the burst of innovation in e-Commerce during the 1995-2000 phase and the subsequent dot com bust, we are now experiencing renewed momentum in the online business world,” Mr. Thakar added. Dividing the evolution of e-Commerce into three phases, he said that while in Phase 1, people were buying and retailing online, Phase 2 marked the arrival of the first generation of market disrupters. Today, in Phase 3, the older generation of online companies such as eBay and Amazon.com were getting squeezed out by incumbents such as Walmart, which were coming in and expanding the market, causing B2C and B2B activity to explode. India’s e-Commerce market too was witnessing the arrival of incumbents such as Pantaloon, travel players, etc. who were fueling its growth and making e-Commerce mainstream in the country. Besides an increase in the numbers of pure play e-Commerce companies, India was also seeing traditional retailers take the e-Commerce route and VCs funding young companies focused on the online business model.

The future of e-Commerce in India At the end of the day, there is a growing realization that the opportunities presented by eCommerce are big and will get bigger. Provided applications of mass usage are developed and made available, e-Commerce can truly take off in India. The country’s citizens needed easier access to the Net, navigation and ease-of-use, factors that are critical for the quick adoption of e-Commerce. Convenient and secure modes of payment are a must, as is the need to explore other facets of e-Commerce such as mobile commerce.

E-business in developing countries With developments in the Internet and Web-based technologies, distinctions between traditional markets and the global electronic marketplace-such as business capital size, among others-are gradually being narrowed down. On another plane, developing countries are given increased access to the global marketplace, where they compete with and complement the more developed economies. Most, if not all, developing countries are already participating in e-commerce, either as sellers or buyers. One of the many challenges facing the countries in the Asia-Pacific today is preparing their societies and governments for globalization and the information and communication revolution. Asia-Pacific e-commerce revenues are projected to increase from $76.8 billion at year-end of 2001 to $338.5 billion by the end of 2004.

Brazil’s Submarino: Improving Customer Service through the Internet Brazil’s Submarino is a classic example of successful use of the Internet for improved customer service and support. From being a local Sao Paulo B2C e-commerce company selling books, CDs, video cassettes, DVDs, toys, electronic and computer products in Brazil, it expanded to become the largest company of its kind in Argentina, Mexico, Spain and Portugal. Close to a third of the 1.4 million Internet users in Brazil have made purchases through this site. To enhance customer service, Submarino has diversified into offering logistical and technological infrastructure to other retailers, which includes experience and expertise in credit analysis, tracking orders and product comparison systems. status of e-banking in developing countries There is an increasing growth of online banking, indicating a promising future for online banking in the developing countries. Below is a broad picture of e-banking in three developing countriesof Asia.

-----The Philippine Experience In the Philippines, Citibank, Bank of the Philippine Islands (BPI), Philippine National Bank, and other large banks pioneered e-banking in the early 1980s. Interbank networks in the country like Megalink, Bancnet, and BPI Expressnet were among the earliest and biggest starters of ATM (Automated Teller Machines) technology. -----The Singapore Experience In Singapore, more than 28% of Internet users visited e-banking sites in May 2001 Among the products offered are: . Fund transfer and payment systems; . Integrated B2B e-commerce product, involving product selection, purchase order, invoice generation and payment; . Securities placement and underwriting and capital market activities; . Securities trading; and . Retail banking. -----The Malaysian Experience E-banking in Malaysia emerged in 1981 with the introduction of ATMs. This was followed by tele-banking in the early 1990s where telecommunications devices were connected to an automated system through the use of Automated Voice Response (AVR) technology.

Importance and size is e-commerce to SMEs in developing countries For SMEs in developing countries e-commerce poses the advantages of reduced information search costs and transactions costs (i.e., improving efficiency of operationsreducing time for payment, credit processing, and the like). Surveys show that information on the following is most valuable to SMEs: customers and markets, product design, process technology, and financing source and terms. The Internet and other ICTs facilitate access to this information. In addition, the Internet allows automatic packaging and distribution of information (including customized information) to specific target groups. The International Federation for Alternative Trade (IFAT) is a collective effort to empower the agricultural sector of developing countries. It is composed of 100 organizations (including 70 organizations in developing countries) in 42 countries. Members of the

organization collectively market about $200-400 million annually in handicrafts and agricultural products from lower income countries. In addition, IFAT provides assistance to developing country producers in terms of logistical support, quality control, packing and export. E-commerce at Work in the Service Sector--Customer support call centers of dot-coms and other ICT/e-commerce companies are considered one of the fastest growing components of offshore services in these countries. India and the Philippines pride themselves in being the major locations of offshore data entry and computer programming in Asia, with India having established a sophisticated software development capability with highly skilled personnel to support it. Developing country SMEs in the services sector have expanded their market with the increased ability to transact directly with overseas or international customers and to advertise their services. This is especially true for small operators of tourismrelated services. Tourism boards lend assistance in compiling lists of service providers by category in their Web sites.

E-Mail and the Internet in Developing Countries To date, e-mail is the predominant and most important use of the Internet in developing countries. In Bangladesh, 82% of Internet use is attributed to e-mail, vis-à-vis 5% in the United States. The Web accounts for about 70% of Internet use in the U.S.51 This is due to the relatively high Internet access costs in most developing countries. However, the Internet is considered an inexpensive, although imperfect, alternative to the telephone or facsimile machine-i.e., it is inexpensive due to the higher speed of information transmission, and imperfect because it does not provide two-way communication in real time unlike the telephone

Women Empowerment in Bangladesh: The Grameen Village Phone Network is a classic example of women’s empowerment in Bangladesh. Operators of the village phones are all poor women (who have been selected for their clean and strong credit record). These village phones are regularly visited by members of male-dominated villages. Notably, the women entrepreneurs (village operators) enjoy wider discretion in expending their profits from their phone services than with their household income.

Qs. 1 (B) Trends in e-payment and security concerns---E-PAYMENT What is e-payment? Making payments on the internet is electronic versions of the traditional payment system. In the electronic payment system everything is digital and is designed to handle electronically. Everything about the payment is virtualised in to strings and bits. The Epayment systems are appropriate for business, consumer and business-to-business transactions. E payment is a subset of an e-commerce transaction to include electronic payment for buying and selling goods or services offered through the Internet. The Internet has the potential to become the most active trade intermediary within a decade. The important aspect of e commerce is prompt and secure payment, clearing and settlement of credit or debit claims.

E-Payment 4 years ago…           

Cyber cash Cyber coin E-Cash First Virtual Millicent Mondex Net Bill Net cash Net Cheque SET Traditional Payment Methods (Credit Card, Cash on Delivery, etc.)

…and what is left today?    

Millicent Mondex SET Traditional Payment Methods (Credit Card, Cash on Delivery, etc.)

Categorization of Internet payment instruments

1. Pre-paid Hardware-based  Quick, Geldkarte Software-based  Pay safe card  Micro money  (e Cash)  (Cybar coins)

2. Pay-Now

Cash On Delivery Debit instrument Mobile Payment  Pay box  Mobi Pay  Street Cash  (Pay it mobile) E-Mail-Payments  Pay pal

3. Pay-Later Credit card  Unencrypted  SSl  SET Credit Transfer Billing-/Collection systems  Net900  Firstgate  Paysafekey

New Trend in E payment A number of payment innovations such as smart cards, person-to person payments, check conversion and mobile payments have gained increased attention and could hinder future innovation. Central to this change has been increasing use of payment networks for new or alternative payment uses. When competition and innovation policy in the credit card market was just beginning to be explored several decades ago, there was essentially just one product—the credit card—and one type of network for non-recurring consumer payments— the credit card network.

Examples of Payment networks – Credit Card Networks. ATM Networks. Another example of the evolution to "product-independent payment networks" can be seen in the evolution of ATM/EFT networks. EFT networks, which were previously regionally based, now extend across the country both through direct ownership and through sharing arrangements. ACH Network. -industry groups are looking into ways to use the ACH network to convert and truncate check payments at lockbox locations. As a result, it is increasingly clear that the clearing and settlement business is becoming a commodity business that can be transacted over a variety of networks and clearing arrangements.

Increasing Innovation and Competition While significant change has occurred in the use of payment networks, a number of innovations are currently under discussion or development that would continue to leverage existing payment networks new ways.

International ACH The Federal Reserve has already expanded the scope of the ACH network to send payments to Canada. Currently, a number of different associations, government agencies and private corporations are discussing further extension of this payment system to other countries. In particular, discussions are already under way to investigate the feasibility of expanding ACH payments to Mexico and Europe.

P2P Payments Third party payment providers are leveraging existing networks to provide electronic personto person payments on the Internet and at ATMs. Companies such as PayPal, Citibank and eBay are utilizing the ACH, credit card and EFT networks to provide electronic P2P payments over the Internet.

Mobile Payments Significant investment and research has gone into investigating the creation of mobile payment applications. In addition to leveraging telecommunications networks, these innovations typically utilize existing payment and banking networks. In particular, Visa and MasterCard have worked closely with third party providers and telecommunications firms.

Key Payment Systems 1. 2. 3. 4. 5.

Paypal TradEnable e-Charge Phone Mondex Internet Cash

1. Pay pal PayPal is a money transfer system that was originally launched for C2C (customer-tocustomer) transactions, but recently, X.com, the company behind the service, introduced B2C transactions, by offering accounts for businesses. Paypal acts as a neutral intermediary offering low risk to both seller/receiver and buyer/sender of the money.

PayPal uses e-mail to inform the receiver that a payment has been made. It accepts money from the purchaser in one of three ways: 1. Charging the purchaser's credit card for any transactions (payments) 2. Debiting a checking account for any payments 3. The purchaser sending a check to create a positive balance in his account at PayPal, and having any payments deducted from the account Payment recipients can use the money in the account for online purchases or payments, can receive the payment from PayPal by check, or can have PayPal directly deposit the money into their checking account.

2. TradEnable (I-escrow) TradEnable allows buyers and sellers to set terms online. After both parties agree to the terms, TradEnable emails the buyer, asking him to pay the amount to TradEnable. The payment can be made via credit card, personal or business check, money order, cashier's check or wire transfer. All payments must be made in US dollars. This is kept in an escrow account, and the seller is informed via e-mail to log-in to TradEnable's site to get the shipping details. After the goods are received, inspected and approved by the buyer, the seller is paid by TradEnable for the goods. If the buyer is dissatisfied and returns the goods, the seller will also be given time to inspect and accept the goods as returned. In this case, TradEnable returns the money to the buyer.

3. e-Charge Phone Another alternative payment solution that is fast becoming popular is eCharge Phone because it allows customers to bill purchases to their local phone bills. This makes it convenient for people who do not own a credit card, or who do not wish to give their card numbers due to security reasons. eCharge Phone can handle payments ranging from $1 to $300, as well as recurring subscription charges, such as ISP charges. Their merchant network currently includes such well-publicized sites as ClassMates.com and McAfee.com.

4. Mondex Mondex electronic cash works in the same way as cash which means merchants can transact using digital channels like the Internet, mobile phones and digital television with less risk of fraud. Mondex operates on a smart card and is accessible to everyone, including the youth market and those without bank accounts. The microchip contains a 'purse' in which Mondex value is held electronically. The purse is divided into five separate pockets, allowing up to five different currencies to be held on the card at any one time. The microchip also contains

Mondex security programs that protect transactions between one Mondex card and another.

Security of e-payments Security components of e-payments • Availability • Authenticity and authorization • Integrity • Non-repudiation • Confidentiality

Technologies Aspect • Symmetric encryption – problem of key distribution in large networks not suitable for mass-use • Asymmetric encryption – addresses the problem of key distribution – requires an infrastructure with co-operation on organizational aspects of key management • Legal backing and interoperability open issues • Organizational challenges of PKI

E-signature for the security of e signature for the security of e-payments payments • Compared to traditional payment systems, the use of the open network has allowed more convenient financial services but has also made the nature of risks more complex • There is an increasing demand for security services by banking customers, above all by firm s, confirmed by the vast economic literature and surveys on ecommerce and e-business

• Financial institutions are requested to supply on-line payments on open networks with the same security levels as traditional payment instruments. To win the challenge of the new technological environment, e-signature must be regarded as an enabling platform, or an essential device, to offer a complete set of trust services. These might be grouped in three levels basic services related to validation of identity and issuance of certificates Complementary services to e-signature, typically developed by the banking community, such as electronic documents management systems, attribute management, "Quality of Service" (QoS) dynamic warranty systems, secure & certified mail. value added services, tailored to individual customers, like "escrow services" in business-to-business environment

Major Issues for E security Security of data transmissions The need for treatment of cryptography in both domestic law & international agreements - Government access to public key codes of private cryptography; & - Mutual recognition of cryptography standards Privacy protection The need for explicit privacy protection laws & regulations or policies to govern the use of personal data by on-line services Digital signatures & electronic contracts The need for revising new legislation on electronic transactions Certification & Certification Authorities The need for credibility & security for EC transactions both domestic & international

Points the attacker can target As mentioned, the vulnerability of a system exists at the entry and exit points within the system. Figure 3 shows an e-Commerce system with several points that the attacker can target: Shopper

Shopper' computer Network connection between shopper and Web site's server Web site's server Software vendor

Figure. Points the attacker can target.

“PAYING” IT SAFE The FTC encourages you to take steps to make sure your transactions are secure and your personal information is protected. Although you can’t control fraud or deception on the Internet, you can take action to recognize it, avoid it and report it. Here’s how. Use a secure browser — software that encrypts or scrambles the purchase information you send over the Internet — to help guard the security of your information as it is transmitted to a website. Be sure your browser has the most upto-date encryption capabilities by using the latest version available from the manufacturer. You also can download some browsers for free over the Internet. When submitting your purchase information, look for the “lock” icon on the browser’s status bar, and the phrase “https” in the URL address for a website, to be sure your information is secure during transmission. Check the site’s privacy policy, before you provide any personal financial information to a website. In particular, determine how the information will be used or shared with others. Also check the site’s statements about the security provided for your information. Some websites’ disclosures are easier to find than others — look at the bottom of the home page, on order forms or in the “About” or “FAQs” section of a site. If you’re not comfortable with the policy, consider doing business elsewhere.

Read and understand the refund and shipping policies of a website you visit, before you make your purchase. Look closely at disclosures about the website’s refund and shipping policies. Again, search through the website for these disclosures. Keep your personal information private. Don’t disclose your personal information — your address, telephone number, Social Security number, bank account number or email address — unless you know who’s collecting the information, why they’re collecting it and how they’ll use it. Give payment information only to businesses you know and trust, and only when and where it is appropriate — like an order form. Never give your password to anyone online, even your Internet service provider. Do not download files sent to you by strangers or click on hyperlinks from people you don’t know. Opening a file could expose your system to a computer virus or a program that could hijack your modem. Keep records of your online transactions and check your e-mail for contacts by merchants with whom you’re doing business. Merchants may send you important information about your purchases. Review your monthly credit card and bank statements for any errors or unauthorized purchases promptly and thoroughly. Notify your credit or debit card issuer immediately if your credit or debit card or checkbook is lost or stolen, or if you suspect someone is using your accounts without your permission.

Q1(c) - Application in various industries (identifies need and scope in various industries like finance, health care, IT, manufacturing, retail etc).

Heath Care ABSTRACT Electronically connecting with patients is a challenging frontier at which technical hurdles are probably exceeded by political, legal, and other barriers. The rise of consumerism, however, compels a response focused more on revenue and strategic advantage than on pure cost savings. Emerging models include “free-floating” personal medical records largely independent of the office-based physician, systems with compatible and intertwined physician and consumer relationships using an application services provider office practice system, and systems that connect patients and providers through e-mail, office triage, prescription refills, scheduling, and so on.

Getting Started The critical step in developing a successful and valuable consumer-oriented Internet strategy is to carefully examine current workflows involving patient interactions. Simply layering new technology atop existing processes is unlikely to yield savings to help fund the initial investment and ongoing costs that truly worthwhile initiatives will require. Provider-Patient Transactions The following list illustrates the varying components of patient-provider communication enabled by Internet technology: • Appointments and schedules: The centre of activity and ongoing provider business is the continual flow of patients through the operation. One challenge is to coordinate and efficiently fill the provider’s schedule in accordance with patient demand. Another is to respond to increasingly busy patient schedules. Electronic communication facilitates the back-and-forth communication that is sometimes necessary to achieve these goals and, in any case, makes the process faster and more convenient. • Prescription refills: This common special instance of inbound triaged requests lends itself to electronic routing, as needed. Personal physician attention may not be needed, depending on the circumstances. • Previsit preparation: This is the collection of data in advance of an office visit, including the reason for the visit. This exchange can be structured using electronic forms to ensure that important data are gathered and available when needed. • Post-visit follow-up: Helpful in closing the loop on office visits with routine results, an electronic communication is also an important means to emphasize advice, encourage compliance with medications, and refer patients to Web-based sources of reinforcing or requesting information with which the provider is comfortable.

• Chronic disease management: Continuous, on-line communication allows for patients to provide regular data for problems such as diabetes, hypertension and obesity and receive coaching responses by physicians or changes in a treatment regimen. • Questions and callbacks: Patients have questions concerning their health, medications, travel, and so on that might be handled electronically in lieu of office visits, depending on the nature of the inquiry. As with. Documentation. Good systems can retain records as by-products of communications and message routing for inclusion into the medical record and subsequent reference. The exchange is permanently documented with regard to date, time, and content. Such documentation does not always occur with telephone conversations; it is difficult and time consuming for providers to dictate or transcribe notes based on verbal exchanges. The automatic trail of electronic communications is more complete and may afford some protections from liability. Personal Health Records. Personal health records (PHRs) in the context of this discussion are patient-owned and managed records in electronic form. Most are Web-based, the most interesting of which are intended to work with a provider-based electronic record system. Nothing about an organized and comprehensive set of patient communications precludes the use of PHRs by patients. Some commercial solutions incorporate PHRs, patient communications, and provider-based medical records into a comprehensive solution. They are certainly worthy of consideration by providers but are up the scale of complexity and risk. PHRs may actually be an evolutionary step up from simpler provider-patient communications. Providers might give additional weight to commercial solutions that offer linked PHRs and office-based records as an option.

--------Insurance products are particularly suited for production, administration and distribution online. Only when a claim occurs are physical processes such as assessment and on-site services necessary. Even these processes can be co-ordinated online with partner company networks. In the same way Internet-based communication networks can be used in the course of fighting insurance fraud. Last but not least, information exchange and communication with the companies’ own sales forces and agents can be conducted more timely, more independent of location and probably also cheaper with the Internet. Ebusiness processes offer small and medium-sized insurers the opportunity to network with uniform standard interfaces compensating for disadvantages of scale. In the field of ecommerce, they will have the best opportunities when they focus on particular customer groups or specialist products and do so better than the large insurers.

The insurance sector is of particular interest for any study on electronic business due to its economic importance, its decentralised organisation and a high level of personal computer usage:

Decentralised organisation: Since the insurance business is often organised in a decentralised manner, optimising business processes between headquarters, agencies and salespersons is a constant challenge. In this respect ICTs can play a vital role.

Companies’ benefits: ICTs facilitate business processes and cut costs ICTs can significantly contribute to improving insurance business processes, particularly in reaching new customers and to tightening bonds with existing customers. ICT use offers a wide range of application opportunities in the entire value creation steps example, journeys may imply route planning and hotel reservation as well as baggage and health travel insurance policy. Marketing: Product presentation on insurance firms’ websites can reduce customers’ need for personal information and facilitate contract conclusion, saving the insurance firm the cost for running agencies and paying commissions to agents. Sales: Automatic premium calculation modules allow individual contract design. Electronic signatures may even enable customers to conclude contracts through the Internet without requiring any paperwork through the Internet can be offered at a reduced rate. Administration: ICT applications allow the automation of parts of the internal workflow, thereby reducing costs. The Internet enables customers to change data such as addresses and deductibles on their own without an insurance agent being involved. Asset management: ICTs facilitate the access to information relevant to investment decisions in insurance companies and investment transactions can be conducted online. Claims Product development: The availability and analysis of customer data in electronic data warehouse and data mining applications makes it easier to create insurance products suited to the needs of particular groups of individuals

Claims management: Damage information can be transferred online, for example reports and digital photos. Paperwork for underwriting and claims processing can be reduced and the firm is freed from customers’ enquiries. Third party companies can be integrated more easily in the damage follow-up by electronic transfer of reports, cost calculations and invoices. Finally, settlements can also be made electronically.

Europe’s first online insurance – Ineas Ineas is the first pan-European insurer to sell its products only via the Internet and to consistently outsource any functions that are not part of its core competencies. In October 1999, Ineas sold its first insurance policy in the Netherlands. At present, the firm operates in the Netherlands, Germany, Belgium and France, where it offers private liability, household, motor and accident insurance. The advantages for the clients are considered to be attractive prices and increased transparency as well as 24 hour access to policies and claims settlement process. Furthermore, Ineas offers an electronic policy and claims folder for the internet, as well as a personal risk management service named PRIMES. This software module contains information on risks, insurance policies and prevention measures, as well as analysis tools to work out insurance requirements.

E-tailing E-tailing (less frequently: etailing) is the selling of retail goods on the Internet. Short for "electronic retailing," and used in Internet discussions as early as 1995, the term seems an almost inevitable addition to e-mail, e-business, and e-commerce. E-tailing is synonymous with business-to-consumer (B2C) transaction. E-tailing began to work for some major corporations and smaller entrepreneurs as early as 1997 when Dell Computer reported multimillion dollar orders taken at its Web site. The success of Amazon.com hastened the arrival of Barnes and Noble's e-tail site. Concerns about secure order-taking receded. 1997 was also the year in which Auto-by-Tel reported that they had sold their millionth car over the Web, and Commerce Net/Nielsen Media reported that 10 million people had made purchases on the Web. Jupiter research predicted that e-tailing would grow to $37 billion by 2002. E-tailing has resulted in the development of e-tailware -- software tools for creating online catalogs and managing the business connected with doing e-tailing. A new trend is the price comparison site that can quickly compare prices from a number of different e-tailers and link you to them. E-Tailing is emerging as an attractive alternative to the traditional brick-andmortar retaining. Chances are that they will co-exist profitably

-----Both retailing and e-tailing are still nascent and growing. One estimate by consultants KSA Technopak is that the organized retailing sector should be as large as Rs 5,000 crore and e-tailing in India should be just about Rs 12 crore. -----A retailer is restricted to a particular location, retailing is location-driven. But, an e-tailer can go global. Being local in nature, a brick-and-mortar retailer has to identify a good location for his operations and wait for customers. On the other hand, an e-tailer has to virtually attract a customer to .. ----- Blue Dart plans to enter the household shipment business in a big way to serve the needs of the online community in India. Looking at the coming e-commerce boom, Blue Dart is targeting a 80 per cent annual jump in its business, mostly from the shipment requirements of its online customers. Top ten e-retailers --1. Amazon.com 2. Planetrx.com 3. Ticketmaster.com 4. Gateway.com 5. Barnesandnoble.com 6. Mothernature.com 7. Iprint.com 8. Hallmark.com 9. Buy.com 10. Bigstar.com

Finance--Companies in the Internet age are finding that IT is no longer a back office support function, but a prime source of competitive advantage. Technology is essential for delivering products and services. For growing numbers of companies, it’s becoming an integral part of their product and service offerings. As IT and business strategies become entwined in e-business strategies and as the competitive environment becomes ever more complex and turbulent, how can companies stay on track in their pursuit of cash flow and shareholder value? Most of the world’s major companies have spent the last few years pursuing strategies to enhance cash flow and shareholder value. Their executive teams have been preoccupied with converging priorities: exploiting IT as an increasingly important source of competitive advantage, focusing on core competencies by streamlining the business through shared services and outsourcing, and participating in globalization and the search for international partners. Many new opportunities open up on all these agendas as companies make the

transition to e-business. The result is continuing dramatic change for the business as a whole and for the CFO and finance in particular. E-Business application in finance Share Trading Electronic fund Transfer E-Banking Security Analysis Tax payments Centralized accounting system Accepting Signatures Via Electronic Methods Audit Trails and internal control Reconciliation of Daily Transactions Downloaded from the Banking System

Manufacturing---Introduction The shift from made-to-stock to made-to-order has resulted in new manufacturing environments that require IT frameworks able to support this new dynamism. In the emanufacturing era, companies will be able to exchange information of all types with their suppliers at the speed of light. Design cycle times and inter-company costs of manufacturing complex products will implode. E-manufacturing is concerned with the use of the Internet and e-business technologies in manufacturing industries. E-Manufacturing covers a single, complete set of operational capabilities including rapid plant design and deployment, real-time ERP connectivity, comprehensive asset management of people, products and processes, and a seamless coupling to the entire supply chain via the Web. E-manufacturing integrates customers, e-commerce systems, and suppliers into the manufacturing process to provide an Internet-based strategic framework for the factory. Companies such as Dell and Hewlett-Packard, along with their major suppliers, have long utilized e-manufacturing to meet their customer needs. Manufacturing sector is using technologies especially Enterprise Resource Planning (ERP),Customer Relationship Management (CRM),Computer aided Designs(CAD), data warehousing thus streamlining the processes, quality and cut down overall costs thus driving the values. IT can greatly expand both the range of what can be produced and the speed and efficiency of production.

REQUIREMENTS FOR E-MANUFACTURING SUCCESS 1. Business processes & production must be synchronized E-manufacturers must raise the visibility of manufacturing information to optimize performance, enhance responsiveness, and manage costs. 2. Collaboration of supply chain Plants need to utilize supply chain planning systems and procurement systems to improve their overall supply chain performance. The goal is to leverage this information in real time to work against actual demand rather than forecasts of anticipated demand. Marketplaces and trading exchanges, he believes, are the frontier for collaboration and the real-time exchange of information across trading networks. 3. Inter & extra enterprise business processes and workflows automation Manufacturing managers need new tools that allow them to have visibility into events as they occur, and the ability to impact those events to add value. The business processes and workflows within the enterprise and across the value chain needs to be automated. 4. Plant information and analysis tools dashboard New Internet-based tools allow e-manufacturing managers to visualize information from a variety of systems throughout the enterprise, and interpret the results in conjunction with established performance metrics. 5. Integrate the design process among all collaborating parties The manufacturing process begins well before the line ever starts to run. New internetbased tools are emerging to support collaborative design and engineering processes. 6. Leverage bi-directional information with customers & suppliers The essence of collaboration is the ability for individual plants to schedule their work in real time based on accepted orders, and to coordinate the delivery of component materials needed at the production level to meet those schedules. That involves sharing not only with suppliers, but providing visibility into the manufacturing process to customers, while gaining visibility into real-time demand from customers.

Q1(d)- Government and technology support (discuss various government initiatives and technology treads facilitating E-Business growth). The role of government in different parts of the world in order to investigate their role in assisting their business enterprise to embrace & benefit from e-business. Since 1970s most of the countries in the world have deregulated most of the business approaches & policies in order to encourage efficiency, free & cross trade& competition in the business environment. Despite the apparent enthusiasm among different governments in the world about ebusiness & their interest in developing policies and initiatives aiming at encouraging ebusiness uptake and use of their business community.  Most of the governments in the world and in developed countries specifically acknowledged the importance of e-business to their countries and to the survival of their businesses in the long run .Most of these governments have actively engaged in setting out initiatives and policies to investigates the status of e-business in the business environment and to put in place plans where e-business could be introduced and defused amongst overall business communities in their counties.  The e-commerce policies of different governments were set broadly and, hence, were not concentrating on business enterprise as such.

Initiative taken by the government in leadership and communication in partnership with the private sector  Raise awareness and champion e-business through leadership and communication (that is workshops, publications ,develop websites ,support through government agencies ,develop key networks between businesses ,professional service provider and the financial community)  Be informed about e-business capability through quality information and research .Identify research and development programmes aiming at providing better statics on the penetration of the Information and communication technology (ICT),and ICT skills ,improving the understanding of the constraints on the adoption of the e-business by businesses to inform policy response .  Deliver better quality, cheaper, secure and faster services to its customers through the introduction of online services and led by example through e government and e procurement.  Ensure the continuing supply of skilled resources either nationally or internationally.

To promote e-business government has established:  A legal framework governing e-commerce transactions (including electronic documents, signatures, and the like);  Legal institutions that would enforce the legal framework (i.e., laws and regulations) and protect consumers and businesses from fraud, among others.  And finally, the Internet, the successful use of which depends on the following:  A robust and reliable Internet infrastructure; and  A pricing structure that doesn’t penalize consumers for spending time on and buying goods over the Internet (e.g., a flat monthly charge for both ISP access and local phone calls).  Security. Ensuring security of payments and privacy of online transactions is key to the widespread acceptance and adoption of e-commerce. While the appropriate policies are in place to facilitate e-commerce, lack of trust is still a barrier to using the Internet to make online transactions.  A separate regulatory departments is also setup (department of information technology) to look into the matter relating to the information technology.  (As published in Part II, Section 3, Sub-section (ii) of the Gazette of India, Extra Ordinary, Dated the 6th January, 2004. Doc. CD-8/2004)   Policy matters relating to Information Technology; Electronics; and Internet (all matters other than licensing of Internet Service Provider)..  Promotion of Internet, IT and IT enabled services.  Assistance to other departments in the promotion of E-Governance, E-Commerce, EMedicine, E-Infrastructure, etc.  Promotion of Information Technology education and Information Technology-based education.  Matters relating to Cyber Laws, administration of the Information Technology Act. 2000 (21 of 2000) and other IT related laws.  Matters relating to promotion and manufacturing of Semiconductor Devices in the country excluding all matters relating to Semiconductor Complex Limited (SCL) Mohali; The Semiconductor Integrated Circuits Layout Design Act, 2000 (37 of 2000).  Interaction in IT related matters with International agencies and bodies e.g. Internet for Business Limited (IFB), Institute for Education in Information Society (IBI) and International Code Council - on line (ICC).  Initiative on bridging the Digital Divide: Matters relating to Media Lab Asia.  Promotion of Standardization, Testing and Quality in IT and standardization of procedure for IT application and Tasks.  Electronics Export and Computer Software Promotion Council (ESC).  National Informatics Centre (NIC)

 Initiatives for development of Hardware/Software industry including knowledgebased enterprises, measures for promoting IT exports and competitiveness of the industry.  All matters relating to personnel under the control of the Department.

The government has also modified its policies to promote a favorable environment for e-business “bridging the digital divide” or promoting access to inexpensive and easy access to information networks;  legal recognition of e-commerce transactions;  consumer protection from fraud;  protection of consumers’ right to privacy;  legal protection against cracking (or unauthorized access to computer systems); And  Protection of intellectual property.  FDI in telecom sectors are welcome. It is important that government adopt policies, laws and incentives that focus on promoting trust and confidence among e-Business participants and developing a national framework that is compatible with international norms on e-business (covering for instance, contract enforcement, consumer protection, Liability assignment, privacy protection, intellectual property rights, cross-border trade, and improvement of delivery infrastructure).

E-Commerce and the Government One of the most significant examples of successful e-Commerce deployment within the Government sector is the instance of the Indian Railways. Today, India’s citizens can check the availability of railway tickets, monitor their status (from standby to confirm) and basically purchase train tickets online, greatly easing their lives. E Commerce has virtually revolutionized the manner in which the railways deliver a part of their services to citizens, making it convenient for ordinary people to buy tickets painlessly and effortlessly. By using e-Commerce to improve the government-citizen interface and greatly enhance the customer experience, the railways have emerged as a beacon in the realm of egovernance success stories—an example for other Government departments beginning their e-governance voyages. Addressing the audience at the NASSCOM e-Commerce event, Mr. Amitabh Pandey, General Manager of the IRCTC said that there was a large and growing market for B2C e-Commerce in India. ―While the absolute numbers are in the metros, the non-metro cities are growing rapidly and should not be ignored in any business plan. The market is not limited to the young. The serious money makers—the 30+ people—are both able and willing to transact on the Net and constitute a significant portion of the market,‖ he said. Mr. Pandey also pointed to the following:

market acceptance of innovations was reasonably high with the Railways’ e-

Ministry of IT has planned and taken initiatives to Promote E-Business Enterprises1) Promoting innovation, supporting entrepreneurs with brilliant & commercial ideas, providing business support, create incubation centres are some of the areas where government with the participation of industry and other sectors have been playing a catalytic and facilitating role. 2) MIT in association with SIDBI, IDBI and software industry has set up a corpus of Rs. 100 crores, named as National Venture Fund for Software and Information Technology Industry (NFSIT). NFSIT is targeted to provide venture capital to start up software professional and IT units in small scale sector. 3) In various software technology parks as well as other parks promoted by State Government, Incubation Centres/plug & play facilities are being set up. 4) To release the Indian venture creation and incubation engines, procedures & policies are being simplified. We need to have many more initiatives.

Some of the initiatives taken by the Government, which may directly or indirectly boost e-Business, are as follows.  The Government has enacted the Information Technology Act, 2000 which inter alia provides legal recognition to digital signatures and electronic contracts.  High Powered Committee constituted by The Ministry of Finance to deliberate and discuss the required amendments in tax legislation to deal with e-business transactions has submitted its recommendations to the Government.  The Government has liberalised the tax and regulatory framework for venture capital funds, especially foreign venture capital funds, thus paving the way for increased venture capital funding to e-Business ventures.  The Government has permitted ISPs to set up international gateways and increased permissible levels of Foreign Direct Investment inter alia in ISPs with Gateways and end-to-end bandwidth providers, thereby paving the way for increased bandwidth and resultantly, speedier internet access.  The Government has set up an Information Technology Ministry to inter alia promote the Internet, e-Business and knowledge based industries.  The Government has also made amendments to the tax law to provide tax benefits, most notable amongst them are:  Tax holidays for units engaged in rendering 15 prescribed categories of IT Enabled services

 Tax holidays for units providing Internet and Broadband Network services  Tax holidays for setting up Special Economic Zones.

Good successful example is the Gyandoot model of Madhya Pradesh where IT has been taken to the rural areas that too in the tribal dominated district of Dhar by imaginative District officers providing very valuable services by way of an intranet connecting 31 villages. Here again the existing fund under the various rural development scheme have been utilized. While 30 centres are funded by government, the remaining are on a basis of franchise and employment opportunities have been created in rural areas by using It. This success has already inspired a collected in Himachal Pradesh to replicate the experience in her district. Government legislation to equate electronic signature to handwritten signature is another means to build the public’s confidence in the security of internet transaction and promotes the use of electronic communication. Throughout 2001, the countries in the EU will introduce such legislation based on a European Commission Directive on a Community Framework for Electronic Signature.

The immediate agenda for the Government now is to enact cyber and convergence laws, amend tax legislation and provide for legislation granting protection to intellectual property rights (prevention of piracy, cyber-squatting etc).

Telecom developments During the last five years, the telecom sector has seen continued liberalization. Telecom services, which were the sole monopoly of the Government till 1994, were opened to the private sector. The National Telecom Policy announced in 1994 separated the policy making functions of the government from those of providing services, and allowed the private sector to provide telecom services. It also recognized the need for the establishment of an independent Telecom Regulator. As a result, a number of private companies were given licences for providing mobile telephone services, and for fixed-line telephone services. International gateways were permitted to be set up by private operators. The policy was further liberalized in 1999. The Department of Telecommunications which was providing telecom services as a sole monopoly was corporatized in the year 2000 and was made to compete with the private sector on a level playing field. The National Long Distance Services on the domestic routes, that were the sole monopoly of the government, were also opened to the private sector.

Existing backbone networks of public and private companies like power grid, railways and gas authorities have been allowed to set up national long distance carriers for data transmission. In January 2001, the government paved the way for unrestricted competition in basic phone services. The move will help consolidate the position for those telecom companies that can offer a basket of services – basic, cellular, Internet, national long distance and broadband – to their customers with flexible tariff packages and single billing as the country moves towards convergence. The basic telecom players will also be allowed to offer mobile wireless in local loop (WLL) services. The Telecom Policy also recognizes the convergence of different media, and has permitted direct inter-connectivity among service providers. Two-way communication through cable has been permitted for voice, data and information services. A cable service provider can also obtain a licence as a fixed service provider. In fact, the country is moving towards full convergence with the Convergence Bill having been introduced in Parliament. This takes care of increasing convergence between telecom, IT and broadcasting services. The Communications Convergence Bill, 2001 envisages the setting up of the Communications Commission of India (CCI) to promote the plurality of different media, forms and structure and provide access to a range of competing viewpoints and information resources, in addition to ensuring consistent approach to regulation of new activities in the era of convergence. These telecom policies have had a positive effect in the last few years. The teledensity rose to5 per cent in September 2002 and is projected to grow to 7 per cent by the year 2005 and to 15 per cent by 2010. The rural density is expected to grow from the current level of 0.8 per cent to 4 per cent by 2010. (The urban teledensity is around 10 per cent). The number of mobile phones is multiplying at very fast rate and is at present 8.5 million. The telecom sector saw an investment in the range of US$ 4.5 to 5 billion by the government and its agencies alone during the last two years. By 2005, a total investment of US$ 37 billion will be required, and this figure will rise to US$ 69 billion in the year 2010 (Department of Telecommunication, India, 2001; and Indian Express [Bombay], 7 June 2001). Many of the private companies have set up national long distance backbone as also fibre optic networks to wire the major cities and the trunk routes for providing all kinds of services. A number of them have also set up international gateways for providing bandwidth to the ISPs. Private sector companies like Reliance Telecom, Powergrid Corporation, Railways, Bharti Telecom, BPL and GAIL are creating cross-country optical fiber networks for broadband services. Even non-telecom players like Enron, Zee TV, and Spectranet are making huge investments in the broadband sector. It is estimated that investments of the order of Rs 318 billion (US$ 6.8 billion) have been made by the year 2001 (Varma, Yograj, 2001 and Das, Sanchita, 2001). International connectivity too is attracting huge investment. Videsh Sanchar Nigam Ltd. (VSNL), which was owned by Government till recently, had a monopoly till recently. It invested Rs 109 billion for a bandwidth of 59 gigabits per second

(Gbps). VSNL as well as Hindustan Teleprinters has since been privatized in March-April, 2002. The private investment of about US$ 1.4 billion by Bharti Telecom, Dishnet DSL has created a bandwidth of 16.08 tera-bits per second (Tbps) connecting India with the world through Singapore, Jakarta, Guam, Portland, Los Angels, Hawaii and Japan. Reliance Telecom and Tata Access are also likely to provide international connectivity in near future (Varma, Yograj, 2001 and Das, Sanchita, 2001). A number of companies are providing broadband access over the cable. Set top boxes and cable modems can enable existing TVs to act as Internet devices. All major cities are being wired with optical fibers to provide cable TV services, and broadband Internet. The existing 98 million TV sets have the potential of accessing Internet. As a result of these policies a number of ISPs have come into being which have spearheaded the growth of Internet connectivity in a big way. Over 170 ISPs are fully operational in the country which have taken the number of Internet connections from a mere half a million three years ago, to 3.5 million by September 2002. Each Internet connection is used by multiple users. The estimated number of Internet users is 17 million. By 2005, Internet connections are expected to go up to 25 million while the Internet users will rise to over 100 million. The NASSCOM survey finds that there are over 400 cities that have at least 2000 Internet connections. This number will double in the next one year. This shows that Internet has penetrated well beyond the metros to smaller cities and towns across the country. The current level of Internet bandwidth available in India stands at 10 Gbps. By 2004, the bandwidth demand will be at the level of 100 Gbps. By the year 2005, data traffic which is 5 per cent today, will account for 50 per cent to 65 per cent. Wireless, broadband and convergence of media are emerging in response to the demands of the growing number of Internet users in the country.

Legal and regulatory framework for e-commerce Besides developing the e-infrastructure in the country through effective Telecom Policy measures, the Indian government is taking appropriate steps as confidence building measures for the growth of e-commerce. It has created the necessary legal and administrative framework through the enactment of the Information Technology IT Act which combines e-commerce transactions and computer misuse and frauds rolled into an Omnibus Act. While on the one hand it seeks to create the Public Key Infrastructure (PKI) for electronic authentication through digital signatures, on the other hand, it seeks to build confidence among the public that the frauds in the cyber space will not go unpunished. The Controller of Certifying Authorities (CCA) has been put in place for effective implementation of the IT Act. The Act also enables e-governance applications for electronic delivery of services to citizens. The CCA acts as a regulator for the growth of e-commerce and egovernance. It is responsible for the establishment of PKI the country through licensing of certifying authorities (CAs). For this purpose, it has notified standards which are based on

international standards as adopted by the International Telecom Union, the Internet Engineering Task Force (IETF), Institute of Electrical and Electronics

CONCLUSION Government has now recognised the potential in the E-Business industry as a future of all the business activities. Government is now designing the policies with an aim to encourage individuals & organisations to go for E-business. E-governance is a major step in these directions showing the confidence of government in e-business.

Ques.2:-Consider you are assigned a task to start a new E-Business department for an existing brand OR a task to start an E-Business from scratch, draw an outline of steps and process you would undertake. Discuss key elements to be considered for starting and promoting the E-Business. Ans: - The first question is what does the E-Business means. E-Business can be defined as follows E-Business is the process of buying and selling over a common electronic network. The most popular network over which E-Business is conducted is internet. it includes •

buying and selling of goods and services

•

servicing customers

•

collaborating with business partners

•

conducting electronic transactions within an organization

When we decide to start a new E-Business for a existing brand we will adopt the following process Process for developing E-Business

The significant issue faced by managers today is one of transformation: “How do I transform the brick and mortar company of yesterday to the click and mortar economy of today to be competitive in the inevitable digital economy of tomorrow. A realization that has come about in today’s hyperactive e-economy is that traditional planning horizons tend to be too long for the very fluid state of e-business. Continuous planning with feedback has evolved as the strategy of choice for the fluid and volatile eenvironment. This method of continuous planning with feedback is structured around four steps: 1. Knowledge building and capability evaluation: Identify and acquire a comprehensive understanding/vision of customer needs. Develop a clear understanding of what capabilities you need in order to address the identified customer needs. Communicate this understanding of customer needs to all employees of the organization. 2. Develop a comprehensive e-business design: this entails developing the competency that lays the foundations to address the customer needs. If the customer wants selfservice, then the business design must provide and facilitate the same .

3. E-business blueprint: is what provides the vital link between the e-business design, the business goals, and the technology foundation. If a self-service business model is to be implemented, then the e-business blueprint helps determine the needed application framework. It maps the projects and performance milestones that must be achieved. 4. Application development and deployment: translate the key milestones and projects into integrated applications. It provides for feedback loops that: (a) At the micro level lets employees know how their individual job performance impacts corporate objectives, and (b) At the macro level furnishes feedback on the overall corporate objectives. It facilitates an understanding about what is working and what is not so that refinements/remedial actions may be undertaken. Developing an e-business Plan While there is no singular approach to developing an e-business plan, the following provide a few guidelines. Making e-business a reality involves two key elements: the business strategy formulation and the application framework. The business strategy formulation component helps determine the facets of business that lead to customer value creation while e-business strategy formulation is comprised of the following: Knowledge Building: helps the organization understand what the customer is looking for and the overall industry outlook. It facilitates an understanding of customer needs and what they value. The following table identifies some of the key questions that will need to be addressed prior to a foray into e-business:

Understanding the customer

· Who are my customers? · How are my customers’ priorities shifting? · Which customers belong to my target market?

Customer value and relationship trends

· How can I add value for the customer? · What makes me my customers’ compelling choice? · How does my product reach customers?

Technology trends

Competition

· Is there a good understanding of the environment & industry trends? · Are the implications of the technology trends factored in? · Who are the direct competitors? What are their strengths/weaknesses?

Capability Evaluation: is an organizational audit of competencies. It provides the inputs for competencies as they exist and helps develop an understanding of gaps in competencies. It helps organizations develop an understanding of the inventory skills as they serve current customer needs while helping plan for changing customer priorities. The following table sheds some light on some of the key areas that may be evaluated as part of a competency audit: Customer Interface Sales

Production & Fulfillment Manufacturing

Human resource Culture

E-commerce

Distribution

Skill Set

Marketing

Supply chain

Training

Customer service Production scheduling Channels of Inventory Distributions management

Technology

Infrastructure

Resource planning systems Networks

Financial systems Research & Development Human resource

Web sites & Intranets Security

Knowledge managemen t Executive IT skill set commitment

E-business design: asks what value proposition a business must provide to take advantage of digital capabilities. How is this value going to be packaged into products, services, or experiences? The e-business blueprint, or application framework strategy, helps take the “what to do” and convert it into the “how to” of value creation. There has been a spate of innovation in this area. Businesses that have been able to harness the power of the Internet by translating its competencies into value for its customer now enjoy a distinct competitive advantage. The table below identifies some of the e-business designs that have been successful and widely discussed in the literature: Pioneer: as the term indicates these businesses are first off the starting blocks and their success stems from using the Internet to satisfy customer needs in a unique fashion. Besides being the first in the marketspace, pioneers stay ahead of the competition by innovating continuously and adding

value to the exchange. Amazon.com is an example of a company that has successfully deployed this strategy. Disintermediation: this strategy often entails reconfiguration of the supply chain. It may entail directly accessing the customer or realigning the marketing channel. Cisco and Dell are examples of companies that have used the Internet to rethink the marketing channel and gain efficiencies in the process. Infomediary: is a strategy where customer search costs are reduced by using the Internet. This has been very successful in instances where a customer is in the market for a homogeneous shopping product (example: automobiles). Auto-By-Tel is an example of a company that has been successful in using this strategy Transaction Intermediary: entails deploying the Internet to facilitate the purchase process. The transactional model facilitates the complete transaction from searching to after sales followup. Companies that have used this strategy include: e-bay and Microsoft Self-service innovator: entails using the Internet to provide services that an organizations’ customers can access directly. United Parcel Service (UPS) and Federal Express are two examples of companies that have reduced manpower costs by creating Web sites that customers can query for an array of services/information. Channel mastery: Deploying the Internet as a sales and service channel. This strategy supplements, the existing channel structure. Example: Charles Schwab

 How to Start an E-Business Whether we want to sell products online or just provide information about our bricksand-mortar business, don't let another day slip by without developing an Internet home base for our business. These simple how-tos will provide everything we need to get started. A) Finding and Securing a Domain Name:The first step in choosing a name is obviously to try to register the name of your business with a .com at the end. Unfortunately, this isn't as cut-and-dried as it sounds because all the good names are most likely taken, by means of the time you read this, the name you want will most likely have been snatched up by someone else. If the .com version of your name is gone and you can't buy it from the owner, try .net or. Org. New domain names like .biz, Info and .us are also available but not used as widely. If even those are taken, you can register your name in one of the more than 100 non-U.S. top-level domains (TLDs) like .cc and .nu. The drawback is that these don't have the recognition of. Com-and your prospects will automatically slap on a .com if your domain name hasn't imprinted itself on their noggins.

B) Choosing a Web Host:With your Web site authored, you need a place to stow it so visitors can access it—and you have hundreds of choices. Many of these hosts are free, and few cost more than $20 per month. Truth is, setting up your own host--a dedicated computer that's permanently wired into the Net--is time-consuming and expensive and, for most small businesses, a bad idea. Better to outsource hosting to folks who specialize in it. While choosing the web host for our E-Business we should adopt the following parameters       

How reliable is your service? What kind of performance do you offer? How good is your support? What will it cost? How do you handle security? How much control do I have? Can you handle the technology I'm using?

C) A to Z of Legal Issues Copyright :- The footer of our site should display a copyright notice for the content of the site. The notice should read "© [date] [copyright owner name] All rights reserved." We should also deposit a copy of the site with the Copyright Office to record ownership of the site's content, look and feel. Domain Name:- When building our Web site, domain names are an important part. Often they are directly tied to our business name, our logos and our brand. Businesses often fail to give proper thought to which domain name to choose. Picking a domain name should have the same careful thought as naming other products or services. Choosing a domain name should include analysis of trademark law in relationship to the name. Export:- If persons from other countries use our site, then We are exporting. Depending on the information on your site, what kind of business We do, the technology and information involved, our site may be subject to regulations formulated by both exporting and importing countries, and We should consult with our legal adviser about these business decisions. Framing:- It is important to be careful how our Web site frames to other sites. There have been trademark cases regarding consumer confusion over which site is which, and which site is the source of the content and data. Giveaways:- Sweepstakes, contests, lotteries and giveaways are governed by state and national laws as to how they must be conducted. Home Page:- On the footer of the home page of the site, We should have a link to our privacy policy, our user agreement or terms and conditions, and our copyright notice. Insurance:- Be sure that our business insurance covers Web site activities. Often Web site activities are excluded from errors and omissions and other business insurance. Jurisdiction:- One of the primary reasons for having a user agreement is to better address the issues of jurisdiction. Under current law, Web site owners may be subject to jurisdiction and law in any state or country where its users are located.

Linking:- When linking to other sites, we should consider two factors. One is what word or image you are using for the link and whether it is a trademark of another site or company. If so, you need the

trademark owner's permission to post the company's trademark on your site. Second, you should always link to the home page of a Web site since there have been "deep linking" cases claiming loss of advertising revenue, which would have been gained if the users had been directed through the home page. Obscenity:- Materials that are considered “obscene” by state or federal law are not permitted on the Internet and, especially, may not be viewed by children. What is obscene is based on the local standards of the viewing community. Trademark:-Trade marking the name of our company, logo, mottos and domain name is an important part of our business development and should be reflected on our Web site. our nationally registered marks should display an ® and unregistered marks should display a ™ or SM. User Agreement:-Having a user agreement or "terms and conditions" may be the most important part of a Web site. A user agreement requires each user to agree to be bound by a contract governing his or her use of the site by clicking "I agree" before being permitted to use the site. Warranties:- Statements on our Web site about our products and services are express warranties to customers. It is important to carefully review all Web site text to be sure that what our company promises is true and corresponds with its other policies and advertising. Your Risk:- The law is all about risk. The more time and money We spend following laws and regulations governing our business, the lower our risks of fines or successful claims by government or third parties D) Accepting Payments The number-one question on the minds of new Web site builders is, how do I arrange to accept credit cards for payments? A good first place to start your search for merchant status is your own bank. Most issue credit cards, and if you have a long-term relationship, that's a big plus. Your bank says no? Try a few other local banks--offering to move all your accounts--and you just may be rewarded with merchant status. You may also try other companies that specialize in issuing accounts to online merchants, including: Card service International VeriSign Credit Card Processing Services The Processing Network 21st Century Resources Or log onto Google and search for credit card processing. You'll find many dozens of outfits, large and small, that are on the prowl for start-ups seeking merchant accounts. While choosing the medium or accepting the payment we should consider the following points 1) Making Customers Feel Secure 2) Fraud Prevention Tools Other Payment Options Money orders. Existing checking accounts Check cards Electronic checks Internet checks. PayPal

To increase your merchant account eligibility, follow these tips: Ensure a positive credit rating. Be honest about previous merchant accounts, bankruptcies, liens or judgments. Be willing to pay higher fees or accommodate special account requirements

E)How to Create a Site for Service Business Businesses selling a service--or thinking about selling a service--over the Web face a few unique challenges that warrant special discussion. Challenge #1: We are the product. Challenge #2: Our time is limited. Challenge #3: We must prove your ability to deliver measurable results, while emphasizing flexibility. Challenge #4: We are using a global medium to attract local business. In order to overcome these challenges, there are several strategies we can employ Strategy #1: Establish our credibility. Strategy #2: Be specific about exactly what We are offering. Strategy #3: Demonstrate our flexibility. Strategy #4: Make it easy for leads to contact We. Strategy #5: Network and get listed in local directories. Strategy #6: Encourage referrals and repeat customers.

 Site Design and Content F) Designing our Site: How to Do It ourself or Hire a Designer Countless small businesses rely on Web consultants every day to design and build their Web sites, enhance existing sites, and put together the pieces of each company's distinctive ecommerce strategy. If we are trying to get our company's site up and running, we can choose among independent site developers, Web design shops, technology consulting firms, system integrators, traditional advertising and public relations firms, and interactive agencies. Some of these outsource the Web site hosting and site promotion functions, while others keep these functions in-house. In addition, Web design and strategic consulting are often provided by Web hosting companies.

G) 10 Design Mistakes to Avoid 1. Not planning our site. 2. Failing to put contact information in a plainly seen location. 3. Broken links. 4. Outdated information. 5. Too many font styles and colors. 6. Orphan pages. 7. Disabling the back button. 8. Opening new windows. 9. Slow loading times. 10. Using leading-edge technology.

H) Adding Stickiness to Site Our site is up, so now how do we make it special and filled with content that attracts visitors and keeps them coming back? That mission consumes site-builders, both full-time professionals and parttimers, but if there is one fact we now know to be absolutely true, it is this: Simplicity is best.

 Customer Service I) Creating a Privacy Policy A must when building our Web site is writing a privacy policy and posting it boldly on your site--it's a necessity today for building consumer confidence A good policy includes a description of how data is collected and used; a way to allow users to choose not to provide data or permit their data to be shared; and a description of the procedure for users who want to request or update data. A good privacy policy should cover questions anybody visiting your site might have. Tell people what's being gathered, by whom and for what purpose. Visitors should also be told their options for participating in your information-gathering.

J) Dealing with Product Returns Once our customers click on the "Pay Now" button and you've filled their orders, we may not be finished with them: After receiving the product, they may decide it's not what they wanted. And getting the product back isn't always so simple. we'll likely be in contact with them numerous times, and we'll have to process a refund and restock the product once you've received it. There's almost more to the return than the steps involved in the original sale. Suffice to say, customer returns can often be very time-, processand cost-intensive.

 Marketing Your Site K) 21 Ways to Promote Site Online and Off Offline Promotions 1. Always put our URL on letterhead, business cards and in e-mail signatures—wherever potential visitors are likely to see it. 2. If our employees wear uniforms, put our URL on them so every one of our customers sees a walking advertisement of our Web site. 3. Include our URL on all promotional items we give away—coffee mugs, T-shirts, key chains and so on. A daily reminder is a good way to get people to visit our site. 4. Be sure to include our Web address in all press releases we send out to members of the media. By having it at their fingertips, they may be more likely to include it in articles they write about our company. 5. Don't forget to put our Web address in our Yellow Pages ad. That people see every day. 6. Do we own any company vehicles? Be sure to put your URL on the side of any car or truck that's out there delivering your products. 7. In addition to listing your toll-free number, put our Web address on the bottom of every page of our catalog so customers have easy access to our online store.

Online Promotions 8. Hone our search engine submission process so we can get the best exposure possible. 9. If we are still itching for more exposure, we can explore search engine marketing, wherein we pay to have a text ad appear when visitors search for certain keywords. 10. Launch a sweepstakes that offers anyone who registers on our site or subscribes to enewsletters within a certain time frame the chance to win a free gift. 11. Send out a weekly e-mail newsletter to registered site members that offers tips and news related to our company or industry with links back to your site. 12. Offer free content to other sites. It's a win-win situation: The other site gets free articles to beef up their offerings and we get a link back to our site and the cachet of being an expert. 13. Send a well-planned, customer-focused e-mail promotion to a targeted list of potential visitors and offer a credit toward the purchase of anything from our site. Spend time on our e-mail's look and content: We want to offer value to customers and not have it appear to be spam. 14. Create our own link exchange by asking sites complementary to ours (but that don't compete) to put our link on their pages and we'll do likewise. 15. Hook up with Web affiliates—hundreds of sites that all link their traffic to ours—and get visitors from sites with related content. 16. Get active in online discussion groups and chats and always include our URL in our signature. (Don't do any hard selling, though. Most groups frown on such behavior and will think you're spamming the group.) 17. Any time someone orders a product from our site, include a catalog with their order to get them coming back for more. 18. Inspire our visitors to spread the word for you with viral marketing techniques, from the aforementioned newsgroup participation to including an "e-mail this link" on every page of our site. 19. Not sure what our customers want? Try creating an online survey to get their crucial opinions on how well our site is selling to them. 20. When creating our own ads, make sure we understand who we are targeting, the goal of our campaign, and how to creatively use the ad confines to get viewers to click on our ad, not away from it. 21. Use other selling venues like online classified advertising or online auction sites to increase exposure to your site and products. L) Improving Search Engine Standings It may seem like trying to find our Web site on a search engine or directory is like trying to find a needle in a haystack. However, we can influence your ranking within a search engine through a variety of

ways, with the most basic aspect being proper set-up of the page being submitted--namely, the title of the page, metatag description, metatag keywords and body text. Prior to editing the HTML of the page, do some prep work to plan the keywords the page should be associated with. On a worksheet, put together a list of 10 primary keywords that are strategic to our Web strategy. Order them by importance. In another row, list derivatives of the primary keywords.

M) Pumping Up Site's Marketing Copy We all know that well-written copy is one of the most effective methods for getting people's attention and attracting them to your product or service, but the importance of the shortest copy is often overlooked. A lot of people don't even realize that things like their navigation menus, links or even their newsletter subscription offers are copy and require careful consideration.

N)Determining if Site Is a Good Sales Tool If our Web site were one of our salespeople, would we keep that employee working for us? It doesn't matter if we're the only "salesperson" or we have a dedicated sales team; brochures, product sheets and a shopping cart system aren't enough to build any online or offline business. we want our Web site to engage, enrol and compel customers. we want it to qualify prospects, present solutions and close sales. We want it to grab a visitor's attention, create some interest, build desire and get the visitor to take some action. we know--the stuff that salespeople do.

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E-Mail Marketing

O) Creating, Managing and Increasing Opt-In List Here's the simple truth: If our site isn't collecting opt-in e-mail addresses from our visitors, we're losing money. I'm always blown away by the number of sites I visit that don't have a place for visitors to leave their e-mail addresses, but I think I've finally discovered the reason why every site doesn't take advantage of this essential marketing strategy: People are convinced that the process of adding this function to their site is complicated. It's not! Getting set up is quick and easy: we don't have to be a programmer to do it--and our opt-in list will quickly become our most valuable sales vehicle.

P) Boost Opt-In Rate Just because you have your sign-up box ready to go and are prepared to handle your opt-in lists, it doesn't mean people will automatically provide you with their e-mail addresses. You've got to give them something in order to get something. People value their privacy--and their information--so you have to offer them something compelling in return: an e-newsletter aimed at their interests, for instance, or a free e-book on a subject they've told us they're interested in. However, let's assume we're already offering something valuable in exchange for their e-mail addresses. If we're still not getting many sign-ups, it's likely our pitch that needs polishing.