Discuss How E-commerce Can Reduce Cycle Time, Improve Employees' Empowerment and Facilitate Customer Support

Posted by Pit Ei

E-commerce is widely used by individual and organizations these days because it brings many benefits to us such as reduce cycle time, improve employees' empowerment and facilitate customer support.


Reduce Cycle Time
Cycle time is the total amount of time between the orders that placing by consumers and receiving the goods and services. E-commerce can reduce the cycle time by eliminating steps in the business process and take a shorter time to complete a business transaction. Once the customers request the products and make the payment online through credit cards, the organization can send the products directly to the customers without the process of middle man and intermediaries. By this, the organization can reduce the cycle time, costs and gain competitive advantages towards other competitors. For example, TradeNet in Singapore reduced the administrative time of port-related transactions from days to minutes.

Improve Employees' Empowerment
Employees' empowerment is the process of enabling or authorizing an employee to think, behave, take action and control work and decision making in autonomous ways. By giving more flexibilities to access information such as Internet, Intranet, Electronic-Data-Interchange (EDI) and other access to global regulations and latest information are able to improve employees' empowerment. Therefore, the employees have the ability to make decision for customers, have sufficient alertness of the complaints and they are able to handle the complaints efficiently. By having E-commerce, the employees even can work at their own house and can provide a quick response or feedback to the customers. As a result, it will benefit organization in term of getting closer to customers, improving service quality, innovating continuously, increasing productivity and gaining the competitive edge.

Facilitate Customer Support
E-commerce also providing a wide range of technological solutions and communication opportunity. It can provide unlimited shopping hours for customers to place their order as it is run on a 24 hours basis. Customer has direct access to product information updates, and other promotion by visiting the online stores that create an interactive and easier way for customer to buy the products that they need compared to the traditional stores. Besides, it also provides electronic bulletin for customer in order to report fault and dissatisfaction.

References:
http://www.businesstown.com/internet/ecomm-definition.asp
http://www.remarkable.co.nz/ebusiness/ebusiness_cost_benefit.htm
http://biz.yahoo.com/iw/080324/0378211.html

comments (0) | Labels:

An Example of an E-commerce Success and Its Causes : Lelong.com

Posted by Xingpei

10 years down the road, Lelong.com is one of the earliest e-commerce companies being set up in 1999. This auction site was mostly filled with gadgets ranging from personal computers to mobile phones, anything from household appliances to electronics goods to toys, including used and new products. Today, Lelong.com achieved more than 31 million pageviews and a million unique visitors a month. Undoubtedly, Lelong.com is Malaysia’s biggest and most active Internet auction site. According to Richard Tan, the number of people trading online is growing and e-commerce is more popular among the younger generation. Around 80% of their members are below 35-years-old.




Pushing Factors
Similar online services such as lowyat.net and eBay Malaysia are helping to spread the word on online transactions, in turn helping Lelong.com to build more traffic. More Malaysians are experiencing such transactions and realizing that is a worthwhile pursuit especially if they are hunting for collectibles, really good bargain. Nevertheless, the broadband Internet services with access speed of 1Mbps to 4Mbps, Lelong.com pages load very fast compared to the early days using dial-up connections.


Key Success Factors
Richard Tan believes its success comes from ensuring Lelong.com’s business is built firmly on trust. “That’s the main reason people keep coming to our website for trading,” he says. One of the key success factors according to Richard Tan was their stringent security measures. He claimed that, in order to build trust between sellers and buyers who use the site, Lelong.com does not allow its seller to be anonymous. As for your information, there are many other sites and forums that allow seller to sell if they insist on anonymity. Lelong.com ensures all sellers go through a stringent verification process to guarantee a safe shopping environment for buyers. It shows how serious Lelong.com is on the issue is the security tagline on its website – “Guilty as Fraudster – Until Proven Not.” Though there is no such thing as complete security, but Lelong.com strives to reduce the risks to a large extent. Due to all these measures, there are hardly fraud-related complaints from users of the auction website, and the most complaints that they received do with shipping delays.

Another key success factor of Lelong.com was they do not charge a listing fee or earn sales commissions for its services. It only sells advertising space and charges customers who want their product to be prominently featured on the site, a small fee. Users can list items free on the site with only premium features, having a reserve price and offering Dutch auctions incurring charges. With RM 168 a year, users can set up an online store at Lelong.com. Richard also claimed that the toughest part in e-commerce business is not building a website but attracting traffic to the site. Thus, being in the Featured section could make a difference as it makes your items to stand out from the crowd, which is why they charge for the service. Moreover, Lelong.com retains its “For Malaysians only” clause is to enable it to have better control should there be incidents of fraud.

I believe Lelong.com will continue to chalk up more milestone in the next decade, as e-commerce is getting more popular as time goes on.

Reference:

http://star-techcentral.com/tech/story.asp?file=/2008/5/20/itfeature/1208205&sec=itfeature

comments (0) | Labels:

The History and Evolution of E-commerce

Posted by Qi Ying

What is E-commerce?

E-commerce is a term for any type of business, or commercial transaction, that involves the transfer of information across the Internet. It covers a range of different types of businesses, from consumer based retail sites, through auction or music sites, to business exchanges trading goods and services between corporations. It is currently one of the most important aspects of the Internet to emerge.

E-commerce allows consumers to electronically exchange goods and services with no barriers of time or distance. Electronic commerce has expanded rapidly over the past five years and is predicted to continue at this rate, or even accelerate. In the near future the boundaries between "conventional" and "electronic" commerce will become increasingly blurred as more and more businesses move sections of their operations onto the Internet.

The History and Evolution of E-commerce

Over the past 12 years, the Internet has changed the way we buy and sell goods and services. Do you remember buying airline tickets before the Internet? Or can you imagine buying a new computer or car without doing hours of Web research? The history of E-commerce is a history of how Information Technology has transformed business processes. It basically started in the 1970s.

In 1970s

A form of electronic commerce appeared that is called Electronic Fund Transfer (EFT). This form was used by employers to pay their employees by transferring the money directly to their personal bank accounts. After that, Electronic Data Interchange (EDI) was introduced. EDI was the way that businesses could share information electronically with each other.


In 1984s

Due to the different EDI formats that company unable to interact with each other, EDI was standardized through ASC X12 that was developed by American National Standards Institute (ANSI). ASC X12 is a universal standard that enable company to complete the electronic transactions stably and reliably. It is designed for sharing business documents and information electronically.


In 1992s

Mosaic web-browser was made available, it was the first ‘point and click’ browser and it was quickly adapted into a downloadable browser, Netscape, which allowed easier access to E-commerce. It provides the users a simple browser to surf the Internet and a safe online transaction technology known as Secure Sockets Layer.


In 1995s

The two biggest companies in e-commerce are launched-- Amazon and E-bay. These companies revolutionized the Internet, as well as the way we buy things. Both companies paved the way for today's e-commerce merchant.


In 1998s

Digital Subscriber Line (DSL) was developed. It was allowed quicker access and a persistent connection to the Internet. This has encouraged people to spend more time and money online. The development of Red Hat Linux was also another major step in electronic commerce growth. Linux gave users another choice in a platform other then Windows.


In 2000s

AOL (known as online software suite) and Napster were also the major development of the E-commerce. AOL and Time Warner merge and they push for the E-commerce. At that time, many people start to make transaction through E-commerce. It is because more convenient as the users’ only need to sit at home and all the transaction can be done.


Nowadays

The largest E-commerce is Business to Business (B2Ba). This form of E-commerce had around $700 billion transactions in 2001 by selling their goods to other businesses. Furthermore, the other forms of E-commerce which are growing include Consumer to Consumer (C2C) and Peer to Peer (P2P). At this time the meaning of the word E-commerce was changed. People began to define the term E-commerce as the process of purchasing of available goods and services over the Internet using secure connections and electronic payment services. In future, there will be more and more people and organization using E-commerce as technology becomes more advance.

References:

http://ecommerce.networksolutions.com/ecommerce_what_is_ecommerce.asp
http://newmedia.medill.northwestern.edu/courses/nmpspring01/brown/Revstream/history.htm

http://www.flysyk02.netfirms.com/Ecommerce/History.htm

comments (0) | Labels:

An Example of an E-commernd Failure and Its Causes : ValueAmerica.com

Posted by Qiau Hui

ValueAmerica.com (VA) was created in the United States by entrepreneur Craig Winn as a B2C company. This company gives customer the chance to buy everything from caviar to computers. VA just as a conduit between the consumer and the manufacturer, this meant that VA would carry no inventory and “free” of overheads.

Winn and his co-founder Rex Scatena each provided $150,000 for the start-up and launch of VA in 1996. In 1997, the Union Labor Life Insurance Company invested $10 million and also provided VA with an introduction to other new investors. At the end of 1998, VA was accumulated deficit of $65.4 million, and in April 1999, floated on the NASDAQ. At that time, Internet stocks were very popular and the sales were a triumph.

The initial public offering (IPO) sold 5.5 million shares and raising $126.5 million before floatation expenses. This gives VA a market capitalization of $3.2 billion in the 1st day. However, just over a year after the stock market floatation, in 2000, valueAmerica.com filed for Chapter 11 bankruptcy. Under American law, companies in Chapter 11 are allowed to continue trading in the hope that they can solve their problems and become profitable as this is deemed to be better for the economy as a whole than the liquidation of the firm.

Lastly, VA was unable to recover and was sold to Merisel, a company specializing in distributing technology product.

There are several points that VA ‘FAIL’:
• VA was simply unable to make sufficient revenues to exceed its costs

• VA could not retain customer loyalty, there were few repeat purchase

• VA's business plan, which relied upon the manufacturer to supply items to the customers. Unfortunately, many of the manufacturers simply did not have the ability to ship items in small numbers to individual purchases, making it difficult for VA to establish a stable client base. Theirs logistics are design to ship large numbers of items to retail outlets. In fact, the incompatibility between customer's requirement and manufacturer's capabilities caused incorrect order, incomplete orders and long time delays b4 consumer received their goods.

• Customer retention- a major campaign was used to publicize the website, which featured more than 1000 brand names. The campaign generated a large number of potential customers to make purchases. However, the firm's computer systems were problems with frequent crashes. As a result, a high number of orders were not filled.

Neither VA was able to generate sufficient sales to become profitable but failed to control the expenditure once it began trading. This failure resulted in serious problems with liquidity and served to rapidly drive VA to bankruptcy.

Reference:
http://www.business.uts.edu.au/finance/research/wpapers/wp113.pdf

comments (0) | Labels:

Subscribe to: Posts (Atom)