Week 8

Management Information Systems, Sixth Edition

Chapter 8:

The Web-Enabled Enterprise

Management Information Systems, Sixth Edition 2

Objectives

• Describe how the Web and high-speed Internet connections are changing business operations

• Explain the functionality of various Web technologies

• Compare and contrast options for Web servers• Explain basic business-to-business and

business-to-consumer practices on the Web• Explain the relationship between Web

technologies and supply chain management


Objectives (continued)

• Give examples of features and services that successful business Web sites offer

• Learn about online annoyances such as spam and adware, and how to protect against online identity theft


Web Business: Growing and Changing

• DLA Piper LLP is the second largest law firm in the world– 3200 lawyers in 24 countries and 63 offices

around the world

– Uses eRoom, a Web-based collaboration and document-sharing tool from EMC Corp.

– Saves 15,000 labor hours annually, uses and mails significantly fewer paper documents, and reduces redundant work


Web Technologies: A Review

• Several standards and technologies enable the Web to deliver rich information, including:– HTTP, HTML, XML– File Transfer– RSS– Blogs– Wikis– Podcasting– IM– Cookies


HTTP

• Hypertext Transfer Protocol (HTTP): transfer and download Web information

• HTTPS: HTTP secure for confidential data exchange

• Uniform Resource Locator (URL): unique address given to each Web site– IP address: a special numeric address

• Domain name: unique name for a Web site, constructed with letters– URL also refers to the domain name


HTML and XML

• Hypertext Markup Language (HTML): helps developer create Web pages– Determines look and location of content

• Extensible Markup Language (XML): enables creation of various data types– Conveys the meaning or content of the data

• XHTML: combination of XML and HTML– Uses opening and closing tags to control format



File Transfer

• File Transfer Protocol (FTP): used to transmit whole files– Used in all downloads from Web sites

– Any type of file can be transferred

– Can place files on a server for shared use

– Often used to deliver purchased software products on Web sites


RSS

• Really Simple Syndication (RSS): family of XML file formats that allow automatic downloads of content on a subscription basis– Helps users check for updates

– Communicates short descriptions of content

– Allows transmittal of new information

– Useful on news Web sites

– Also called Rich Site Summary


Blogs

• Blog: contraction of “Web log”– Invites surfers to post opinions and art– Focuses on a topic or set of topics– Trackback: a tool that notifies bloggers when

their posts have been mentioned elsewhere on the Web

• Blogs are often used by businesses• Importance of blogs to commercial organizations

is to find out what blog participants think and say about the organization

Wikis

• Wiki (from Hawaiian, meaning “quick”): Web application that enables users to add to and edit the contents of Web pages– All the software required to edit the Web pages is

embedded in the pages themselves

• Wikipedia: a popular online encyclopedia• Wiki technology is a popular ingredient in

groupware (software used for collaboration)




Podcasting

• Podcast: publishing sound and video on the Web for download– Usually on a subscription basis

• Uses include:– “Time-shifted” broadcast of radio station

programs for later listening– Audio tours in museums– Lectures in distance learning courses– Garageband.com

• Allows aspiring musicians to post music tracks


Instant Messaging

• Instant messaging (IM): real-time chat– Form of synchronized e-mail– Chat room: communicate with a group– Free applications for IM include:

• AIM: AOL instant Messenger• Yahoo Messenger• MSN Messenger• ICQ• Trillian

– Business uses• Customers can chat with sales or support reps



Cookies

• Cookie: small file that stores information about a Web site visitor, stored on the visitor’s computer– Usually records the surfer’s ID– Often stores the surfer’s preferences– Provides convenience to consumers– Can be temporary (single session) or permanent– Potential for intrusion into surfer privacy

• Clickstream tracking: tracks a surfer’s clicking activities

• Spyware: traces and reports online behavior


Proprietary Technologies

• Proprietary technology: intellectual property of developer, not free for all to use

• Examples:– Local search engine

– Shopping cart applications

– Wish lists

– Video streaming tools

– Tools to analyze and predict Web visitor behavior, especially shopper behavior


Web-Enabled Business

• Web-enabled business are classified according to the interacting parties:– Business-to-business (B2B)

– Business-to-consumer (B2C)

– Government-to-business

– Government-to-consumer


B2B Trading• Business-to-business (B2B): trading between

businesses only• B2B forms include advertising through:

– Search advertising: advertisements placed on a search site result page

– Banners: images placed on Web sites that link to a company site selling a product or service

• Impression: occurs when a page with a banner is downloaded

• Reach percentage: the percentage of Web users who visited a site in the past month


B2B Trading (continued)

• Exchanges and auctions act as online marketplaces

• Intranet: network used only by employees of an organization

• Extranet: network shared by employees of different organizations, usually business partners

• Exchange: extranet for organizations that deal in products and services of a particular type– Exchange operator profits from transaction fees

• Auction: sells a great variety of items



B2B Trading (continued)

• Online business alliances: collaboration between businesses in establishing a Web site– Site operator works for the allied companies

– Suppliers are invited to sell through the site and compete among themselves, driving prices down



B2C Trading

• Business-to-consumer (B2C): trading with the general public

• E-Tailing: online retailing to consumers• Fulfillment activities: picking, packing, shipping• Consumer profiling: know customers better by

gathering information about their online activities– Some consider this a violation of privacy

• Conversion rate: the proportion of site visitors who make a purchase




B2C Trading (continued)

• Auction sites serve as a hub for consumers to buy and sell

• Reverse auction: customers name their own price for desired goods and services

• Content providers: offer information, artistic work, classified ads, and video

• Electronic bill presentment and payment (EBBP): provides online bills and payment options for customers

• Phishing: type of fraud involving a fake Web site



B2C Trading (continued)

• Extra-organizational workforce:– Companies purchase labor from a larger pool

• Mobile commerce, or M-commerce:– Business conducted on mobile devices

• Many experts believe that information delivery is the main mobile application, not commerce– Exceptions are Japan and South Korea

– Japan’s DoCoMo’s i-mode service allows users of smart cell phones to purchase canned soda from vending machines, fast food


B2C Trading (continued)• M-commerce also raises privacy concerns

– GPS provides location tracking

• New top-level domain names with .mobi available for mobile applications– Sites should use special technologies to optimize

content for easy viewing on mobile devices

• Virtual world: a combination of images, video, sound, and avatars that resemble the real world– Accessible for interaction by subscribers

• Avatar: 3D graphical character that represents a user in a virtual world



Supply Chains on the Web

• Supply chain management (SCM) systems may be connected to the Web to allow suppliers to participate directly– Use of XML allows companies to set standards

for data exchange• Electronic Data Interchange (EDI): a system

used prior to the Web to exchange documents electronically– Set standards for data formats– EDI networks are owned and managed by value-

added network (VAN) companies



Options in Establishing a Web Site

• Web site: Web pages that make up information and links

• Internet server: a computer connected to the Internet backbone

• Businesses have two choices for a Web site:– Installing and maintaining their own Web servers

– Contracting with a Web hosting service


Owning and Maintaining a Server• Owning and maintaining Web servers is costly

– Provides the greatest degree of control, but requires expertise to set up and maintain

– Must obtain a high-speed link to the Web

• Load balancing: transfer data requests from a busy server to a less busy server

• Mirror servers: servers with duplicated content• Pure-play: company whose entire business is online• Brick-and-mortar: company that owns physical

stores and a Web site


Using a Hosting Service

• Web hosting: Web server managing service• Several types of Web hosting:

– Shared hosting: stores the client’s Web site on the same physical server as other clients

– Virtual private hosting: simulates a single server, allowing a client to have its own domain name

– Dedicated hosting: client has exclusive use of an entire physical Web server

– Co-location: server owned and managed by a client is co-located with other clients’ servers in a secure physical location


Considerations in Selecting a Web Host

• Compare host vendors using a point system• Dynamic Web pages: enable communication

between browser and database• Factors to consider when selecting Web host:

– Allows use of database management system

– Storage space capacity

– Technical and Web site design support

– Scalability

– Security: physical and virtual


Considerations in Selecting a Web Host (continued)

• Factors to consider when selecting Web host (continued):– Availability: minimize downtime

– Costs, including: • Setup fees• Traffic-based fees• Monthly fees



More Than Meets the Eye

• Several elements are essential to conducting business on the Web:– Inquiry interface: connects to database to allow

user to search a catalog of products or services

– Order processing application, including:• Credit-card verification application

– Order-fulfillment system: picks, packs, and ships



Rules for Successful Web-Based Business

• Business success depends on availability and use of software

• Elements needed to support B2C commerce:– Targeting customers

– Capturing the customer’s complete experience

– Personalizing the service

– Shortening the business cycle

– Let customers help themselves

– Be proactive and de-commoditize


Target the Right Customers

• Target customers needing your products and services– Most important effort of marketing

• Involves identifying the sites that your audience frequently visits

• Consider blogs and podcasting sites for advertisement placement


Capture the Customer’s Total Experience

• Use cookies to record shopper’s movements within the site

• Use CRM software to create consumer profiles• Shopper experience becomes an asset of

business, allowing:– Fine-tuning of the product portfolio

– Tailoring of Web pages to individual customers

– Individual e-mails to shopper offering products of interest


Personalize the Service

• CRM software and Web page customization software can be combined to:– Personalize Web pages shown to a customer

– Allow the customer to select the type of e-mail content desired

– Respect visitor privacy by offering opt-in rather than opt-out

– Allow the customer to tailor products to be purchased


Shorten the Business Cycle

• Business on the Web saves time for customers• Fulfillment is a major challenge for businesses

– Activities after customer places order• Fast shipping is desired because:

– It produces higher customer satisfaction– Business collects payments faster

• Can outsource the entire fulfillment task to fulfillment organizations such as:– UPS’s e-Logistics– FedEx’s Supply Chain Services


Let Customers Help Themselves

• Customers need information from organization:– Status of order

– Status of shipped item

– Installation instructions

– Troubleshooting

• E-mail messages sent to customers with information about orders and how to track them

• FAQs online allow customers to find answers to common questions


Be Proactive and De-Commoditize

• Prompt e-mail replies expected• Proactive alerts expected for changes in orders

or services, or product recalls• Automatic reordering features are desirable• Must take initiatives to de-commoditize products

– Commodity: a product sold at roughly the same price by many vendors (no differentiation)

– Addition of features or services prevents a product from becoming a commodity by creating differentiation


E-Commerce is Every Commerce

• Web technologies have been highly integrated into the business world– Difficult to identify which business activities are

on the Internet and which are not

• Web has been highly integrated into daily activities of customers also

• Commerce and e-commerce generally have the same meaning today


Summary

• Some industries have changed drastically because of the Web

• HTTP is an Internet standard controlling Web server addresses

• HTTPS is a security version of HTTP• XML is a standard for description of data• Blogs enable people to create discussion Web

pages


Summary (continued)

• Cookies help Web sites personalize the visitor’s experience

• Many Web technologies are proprietary• A business can maintain its own Web server or

use a Web hosting service• Organizations should consider several factors

when selecting a Web host• Web-enabled commerce is classified into B2B

and B2C


Summary (continued)

• B2B trading relies on electronic data interchange (EDI) and XML

• Wireless handheld computers allow mobile commerce, called m-commerce

• Online businesses must adhere to several factors to be successful

• Virtual worlds provide a means to meet and conduct business and social activities on the Web

• Spam and spyware are online annoyances• Phishing is a pervasive fraud crime

Week 8

Education

web information https

web business

web blogs

rich information

web technologies

web servers

news web sites

web visitor behavior