Wednesday, January 7, 2009

Role of internet technologies in enabling an organisation to obtain competitive advantage through B2B e-commerce

Business now faces its new phrase by the use of Internet, where most of the customer and the producer are doing transaction only in the virtual realm. It is undeniably true that almost all businesses have its corresponding web site to advertise their business to the public. Most of the people also are creating their business already in the virtual world or in the virtual market. The internet gives greater advantage both in the consumer as well as in the producer’s side. There are many processes that are cut off because of the direct linked of businesses in the internet. Markets are globally competitive even if it only has small funds in the beginning, because trade in the internet doesn't require big requirements.

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Companies are using exchange of information through the use of proprietary EDI systems. Although companies have been doing business electronically for many years using proprietary EDI systems, B2B commerce over the Internet remained in the early adopter stage at the start of the 2000s. The notion of an early adopter comes from a popular marketing theory which holds that buyers of a new product enter the market in several stages, starting with the early adopters who set the trends and ending with so-called laggards who purchase only after the vast majority has already bought. If B2B is still attracting mainly the early crowd, it suggests great potential for growth, as do the figures from the Census Bureau and private firms. However, another part of the theory suggests there is a gap, sometimes called a chasm that must be bridged between the early adopters and the early majority buyers; many products are believed to fail after doing well among early buyers but failing to catch on in the wider market. Whether B2B Internet commerce crosses the chasm remains to be seen. The same with the traditional way of marketing the internet doesn’t guarantee a 100 percent loyalty of customers. Businesses also have responsibility to maintain to be able to attract many customers not to mention the now growing competitiveness of companies regarding e-commerce. If anyone is having their customer a priority, they should have a flexible strategy that even in the change of trends can still cope up.
It was said that the economic slowdown that began in 2000 was expected to dampen the development of B2B e-commerce and decelerate the migration from proprietary EDI systems to the Internet. Because of this event in the industry many businesses was not able to easily transfer their means of information exchange to the internet. Starting to a new way could also mean a new investment a new capital, and because of the occurrence of striving within businesses it is not possible in the quickest way. All this came on top of the reality that corporate decision-makers were slow to adopt the benefits of B2B e-commerce, even though the technology was available. Some believe part of the problem has been that adopting B2B e-commerce could be challenging to the existing corporate culture. There are also a lot of barriers, ranging from a shortage of technology resources to competitive strategies.
Most and the often problem is interoperability between systems in companies. Often a prerequisite to certain types of B2B e-commerce is compatibility between a company's computer systems and the online exchanges or marketplaces where it seeks to conduct e-commerce. A survey by Computer Sciences Corp. found that in late 2000, less than 15 percent of North American businesses' Web sites had the ability to conduct business online. Other estimates of enterprises able to transact business online ranged up to 20 percent.
There are several reasons why businesses have remained on the sidelines of e-commerce. Small and mid-size suppliers appear to be waiting to see what kind of e-commerce initiatives their larger trading partners will undertake. Suppliers are faced with a choice of building their own Web site, selling over a public exchange, or joining the private exchanges of multiple trading partners. They may feel there is not enough demand from their customers to sell online. Also, many businesses do not have the internal information technology (IT) resources to enter into e-commerce. E-commerce operations typically require significant deployment costs and integration work, much more than simply offering a hosted Web site.
There are also many studies to which says that the first-generation B2B e-commerce Web sites were difficult for customers to use. Problems included too many Web pages to click through, distracting and unhelpful content, difficulty signing up for online service, and difficulty researching products. Next-generation B2B Web sites are expected to be more customer-friendly. They will incorporate such elements as personalization software that will reduce the number of click-throughs required. Other features will facilitate customer self-service, letting them check such things as inventory status on potential orders and track order shipping. Next-generation sites will reflect customer service as business's top priority, with companies leveraging the Internet to better serve their customers.

With the rapid growth of the Internet, organizations are increasingly using the Web to conduct business with greater speed, reach, and efficiency. This transformation is especially prevalent in business-to-business (B2B) commerce and trade. In many studies they had found out that many of the Fortune 500 companies have adopted e- procurement systems such as Ariba (see sidebar, “Ariba”), Commerce One, and mySAP. Many others participate as buyers in e-marketplaces, such as Commerce One MarketSet, Ariba Hosted Market Place, and IBM’s WebSphere Commerce Suite, Marketplace Edition (WCS MPE, or MPE for short), among others.


B2B buyers have diverse procurement systems, such as those offered by Ariba, Commerce One, and SAP, among others. Each of these procurement systems uses different B2B protocols for interaction with seller systems. Many of these protocols are proprietary and specific to the procurement system. Check attached example:
Ariba uses the punchout process between the Ariba Order Request Management System (ORMS) and seller systems using their Commerce XML (cXML, or Commerce Extensible Markup Language) specification for the messages. Commerce One uses XML Common Business Library (xCBL) as the format of messages, and mySAP uses the Open Catalog Interface (OCI; for a process similar to punchout) between buyer and seller systems.The following are some things that are being offered by the internet that enables competitive advantage in the B2B e-commerce:
Open Exchange of Information:
The internet present unlimited amount of information that no one could possibly limit it. Anyone can view the data of certain business and is able to compare it with others. Information also is not limited to time since the internet is open for the whole day, 24 hours a day, 7 day a week, thus everyone can view it.
Online Transaction: Online trust: security and privacy:
Having this advantage, business would not necessarily have many papers to fill up just to complete a transaction. In doing it in the web, one can easily done it without too much hassle. With the growing trust in the cyberspace, almost all transaction is now absolutely in good hands. Without consumer confidence in the safety, security, and privacy of information in cyberspace, there will be no e-commerce and no growth. Protecting information and communications on the Internet is an absolute prerequisite to the continued success of the Internet and the information economy.


Free and open international trade:
The web as it is defined is a linked to all connection in the whole wide world, thus the market in the cyberspace do not have any limits to its audience and customers. Closed markets and discriminatory treatment will stifle e-business. The Internet is a global medium, and the rules of the information economy must reflect that fact. Only in an open, free market will the Internet’s potential be realized.

Investing in an e-commerce technology infrastructure:
Because of the growing electronically driven business, government are also supporting and studying for ways to have a concrete structure in the internet. Supporting the physical infrastructure necessary to deliver digital content (primarily through telecommunications deregulation and government efforts to reduce the digital divide) is vital to spurring technological growth.

Speeding Things Up:
From an article in the E-commerce times , Martin Boyd, director of product marketing at Ariba (Nasdaq: ARBA) Latest News about Ariba, said the real-time aspect of future e-commerce technologies will allow users to engage in "threaded discussions" as they negotiate contracts and share data. The advantage of this is that all are able to see the latest updates and documents in the business.
Because of processes is being done over the internet, things are easily being done, things are speeding up to its high rate. That is why people are now engaged in doing business over the net.

Transactions are simplified:
The net is the home of all possible businesses around the world. From house equipment to the trendy gadget are all in the web. Even finding work is easily done in the internet. Doing the transaction is the internet is so easy to adopt and learn. One just simply have to fill up some information to transact, rather from the traditional ways that there are many needed papers and other documents to be filled and comply to be able to complete the transaction.

Reference:
http://www.business.com/directory/internet_and_online/ecommerce/b2b_markets/
http://www.thehindubusinessline.com/businessline/iw/2000/05/28/stories/0728g101.htm
http://ecommerce.hostip.info/pages/141/Business-Business-B2B-E-Commerce.html
http://searchcio.techtarget.com/sDefinition/0,,sid182_gci214411,00.html
http://endeca.com/manufacturing/b2b-ecommerce.html


Reactions:

3 comments:

Trust is really one of the factors coming from the company which customers really love to interact with the trustworthy organizations.

Electronic commerce that is conducted between businesses is referred to as business-to-business or B2B. B2B can be open to all interested parties (e.g. commodity exchange) or limited to specific, pre-qualified participants. Electronic commerce that is conducted between businesses and consumers, on the other hand, is referred to as business-to consumer or B2C. This is the type of electronic commerce conducted by companies such as http://www.infysolutions.com

the internet is one great medium for possible opportunities...
but we need to be more resourceful and competitive enough to survive online business

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