Question

1. Given that the business community must constantly adapt to change, examine the impact of the Internet on current business practices.

2. Given that the “what” of business transactions has not changed, but the “how” of e-commerce has changed enormously, examine the infrastructure components necessary to implement a web strategy.

3.How do these two factors and determine what their effect would be on an online retail company.

Answer 1

1. The Internet has allowed companies to find ways for lowering operational costs and saving capital on production of goods or services. Companies often implement business software to track various business operations and review the efficiency and effectiveness of each department. These business software packages help managers review information in a real-time format and make better or more-informed decisions regarding the efficiency of operations. Companies also can enhance their supply chain by communicating information to the distributors, warehouses and retailers that handle the company’s products.Many companies in the traditional business environment were unable to directly sell goods or services to consumers and other businesses. These companies, such as manufacturing and intermediate goods producers, often needed a middleman to help sell goods in the business environment. The Internet allows these companies to set up websites or other electronic order systems to sell products and generate a pipeline for future business sales.

2. Important infrastructure components that ecommerce business require are:

• Marketing : Of all the infrastructure elements, marketing may be the most important. To succeed, your website must be found. Once visitors are on your site, you need to keep them there and compel them to buy from you. That’s the job of your marketing team. Whether it’s website design, social media, search marketing, merchandising, email, or other forms of advertising, it’s all about marketing.To effectively manage marketing activities in-house is very challenging. Most small ecommerce businesses outsource some element of marketing.

• Customer Service :There are many choices today for delivering high-quality customer service. You can manage those activities in-house or outsource to a third party. Basic customer service for sales and post-sales activities can be handled using email, and by providing an 800 number for more extensive phone support. A customer-management system will make those activities easier, but for smaller companies it is not a requirement.Live chat will impact your operations as someone needs to be available during specified hours of operation. Be sure to gauge the impact of that on your organization, if you decide to handle those activities in house.

• Human Resources : Many small-business owners avoid the human resources function. Recruiting, setting up compensation, maintaining compliance and other HR activities are specialized and time consuming. You may choose to bring the resources in-house to manage those activities, but also evaluate outsourcing them. There are many individuals and agencies well equipped to take on your HR activities.

• Information Technology : Choosing the right ecommerce platform is one of the most important decisions you will make in your business. Do you want to build and host your own system, outsource the development and then manage the system going forward, or use a hosted, software-as-a-service platform that is more turnkey and externally managed?

• Finance and Administration : As with other business operations, you will need to decide if you want to manage your finance and administration activities in-house, outsource, or a hybrid of the two. If your ecommerce platform is tightly integrated to your accounting system, you may have very little need for an in-house bookkeeper. If you use separate systems for your website, order management and accounting, you may need more help for data entry and making sure that the information is properly managed.