Unit5: 5.

Database Management: Internet & Electronic Commerce Introduction

Data is a vital organizational resource, which needs to be managed like other important business assets. Most organizations could not survive or succeed without quality data about their internal operations and external environment. Managers need to practice data resource management, a managerial activity that applies information systems technology like database management and other management tools to the task of managing an organization's data resources to meet the information needs of business users. Example of database is Oracles and Access.

5.2

Foundation data concepts

A hierarchy of several levels of data has been devised that differentiates between different groupings, or elements, of data. Data are logically organized into: Character- A character is the most basic logical data element. It consists of a single alphabetic, numeric, or other symbol. Field- A field consists of a grouping of characters. A data field represents an attribute (a characteristic or quality) of some entity (object, person, place, or event). Record - Related fields of data are grouped to form a record. Thus, a record represents a collection of attributes that describe an entity. Fixed-length records contain a fixed number of fixed-length data fields. Variable-length records contain a variable number of fields and field lengths. File - A group of related records is known as a data file, ort able. Files are frequently classified by the application for which they are primarily used, such as a payroll file or an inventory file, or the type of data they contain, such as a document file or a graphical image file. Files are also classified by their permanence, for example, a master file versus a transaction file. A transaction file would contain records of all transactions occurring during a period, whereas a master file contains all the permanent records. A history file is an obsolete transaction or master file retained for backup purposes or for long-term historical storage called archival storage. Database - A database is an integrated collection of logically related records or objects. A database consolidates records previously stored in separate files into a common pool of data records that provides data for many applications. The data stored in a database is independent of the application programs using it and of the type of secondary storage devices on which it is stored.

5.3

The database management approach

The development of databases and database management software is the foundation of modern methods of managing organizational data. Database Management Approach - Is a method whereby data records are consolidated into databases that can be accessed by many different application programs. Database Management System - (DBMS) serves as a software interface between users and databases. Thus, database management involves the use of database management software to control how databases are created, interrogated, and maintained to provide information needed by end users and their organizations. The database management approach involves three basic activities: Updating and maintaining common databases to reflect new business transactions and other events requiring changes to an organizations records. Providing information needed for each end users application by using application programs that share the data in the common databases. Providing an inquiry/response and reporting capability through a DBMS package so that end users can easily interrogate databases, generate reports, and receive quick responses to their ad hoc requests for information. A database management system (DBMS) is a set of computer programs that controls the creation, maintenance, and use of the databases of an organization and its end users. The four major uses of a DBMS include:

Database Development Database Interrogation Database Maintenance and Transaction maintenance Application Development

Database Interrogation: The database interrogation capability is a major benefit of a database management system. End users can use a DBMS by asking for information from a database using a query language or a report generator. Features of a query language: Users receive an immediate response in the form of video displays or printed reports. No difficult program is required. Users can obtain immediate responses to ad hoc data requests. Features of a report generator: Users receive an immediate response in the form of video displays or printed reports. No difficult program is required. Users can specify a report format for information they want presented as a report. Database Maintenance and Transaction Processing: Managers need accurate information in order to make effective decisions. The more accurate, relevant, and timely the information, the better-informed management will be when making decisions. Thus, the databases of an organization need to be updated continually to reflect new business transactions and other events. Transaction processing programs and other end user application packages with the support of the DBMS accomplish this database maintenance process. Application Development: DBMS packages play a major role in application development. Application development is made easier by data manipulation language (DML) statements, which can be included in application programs to let the DBMS perform the necessary data handling activities. Programmers can also use the internal programming language provided by many DBMS packages or a built-in application generator to develop complex application programs. Managerial end users should view data as an important resource that they must learn to manage properly to ensure the success and survival of their organizations. Database management is an important application of information systems technology to the management of a firms data resources. Data resource management includes: Database Administration: - Is an important data resource management function responsible for the proper use of database management technology. Database administration has more operational and technical responsibilities than other data resource management functions. This includes responsibility for: Developing and maintaining the organizations data dictionary Designing and monitoring the performance of databases Enforcing standards for use and security. Data Planning: - Data planning is a corporate planning and analysis function that focuses on data resource management. It includes the responsibility for: Developing an overall data architecture for the firms data resources that ties in with the firms strategic mission and plans, and the objectives and processes of its business units. Data planning is a major component of an organizations strategic planning process. It is done by organizations that have made a formal commitment to long-range planning for the strategic use and management of its data resources.

Data Administration: - Is another data resource management function. It involves the: Establishment and enforcement of policies and procedures for managing data as a strategic corporate resource. Collection, storage, and dissemination of all types of data are administrated in such a way that data become a standardized resource available to all end users in the organization. The planning and control of data in support of an organizations business functions and strategic business objectives. Establishment of a data planning activity for the organization.

 Developing policies and set standards for corporate database design, processing, and security arrangements, and to select database management and data dictionary software. Challenges of Data Resource Management: The database resource management approach provides business managers and professionals with several important benefits such as: Reduce the duplication of data Integrate data so that multiple programs and users can access them. Programs are not dependent on the format of the data and the type of secondary storage hardware being used. Users are provided with an inquiry/response and reporting capability that allows them to easily obtain information; they need without having to write computer programs. Computer programming is simplified, because programs are not dependent on either the logical format of the data or their physical storage location. Integrity and security of the data stored in databases can be increased, since database management system software, a data dictionary, and a database administrator function control access to data and modification of the database. The limitations of database management arise from: Its increased technological complexity. Development of a large database and installing a DBMS can be difficult and expensive. More hardware capability is required, since storage requirements for the organization's data, overhead control data, and the DBMS programs are greater. Longer processing times may result from high-volume transaction processing applications since an extra layer of software (the DBMS) exists between application programs and the operating system. If an organization relies on centralized databases, their vulnerability to errors, fraud, and failures are increased. If an organization relies on distributed databases, problems of inconsistency of data can arise.

5.4

Using database management software

Database Software - Database management systems are software packages that simplify the criterion, use, and maintenance of databases. They provide software tools so end users, programmers, and database administrators can create and modify databases, interrogate a database, generate reports, do application development, and perform database maintenance.

5.5 5.6

Types of databases Hypermedia databases on the web

The rapid growth of web sites on the Internet and extranets has dramatically increased the use of databases of hypertext and hypermedia documents. A web site stores such information in a hypermedia database consisting of a home page and other hyperlinked pages of multimedia or mixed media (text, sound, etc.).

5.7

Database structures

In all information systems, data resources must be organized and structured in some logical manner so that they can be accessed easily, processed efficiently, retrieved quickly, and managed effectively. Data structures and access methods ranging from simple to complex have been devised to effectively organize and access data stored by information systems.

The relationships among the many individual records in databases are based on one of several logical data structures or models. DBMS are designed to provide end users with quick, easy access to information stored in databases. Five fundamental database structures are: Hierarchical Structure: Early mainframe DBMS packages used the hierarchical structure, in which: Relationships between records form a hierarchy or treelike structure. Records are dependent and arranged in multilevel structures, consisting of one root record and any number of subordinate levels. Relationships among the records are one - to - many, since each data element is related only to one element above it. Data element or record at the highest level of the hierarchy is called the root element. Moving progressively downward from the root and along the branches of the tree until the desired record is located can access any data element. Network Structure: The network structure: Can represent more complex logical relationships, and is still used by many mainframe DBMS packages. Allows many- t o- man y relationships among records. That is, the network model can access a data element by following one of several paths, because any data element or record can be related to any number of other data elements. Relational Structure: The relational structure: Most popular of the three database structures. Used by most microcomputer DBMS packages, as well as many minicomputer and mainframe systems. Data elements within the database are stored in the form of simple tables. Tables are related if they contain common fields. DBMS packages based on the relational model can link data elements from various tables to provide information to users. Multidimensional Structure: The multidimensional database model: Is a variation of the relational model that uses multidimensional structures to store data and relationships between data?

 A major benefit of multidimensional databases is that they are a compact and easy-to- understand way to visualize and manipulate data elements that have many interrelationships. Multidimensional databases have become the most popular database structure for the analytical databases that support online analytical processing (OLAP) applications. Object-Oriented Structure The object-oriented structure: Is considered to be one of the key technologies of a new generation of multimedia web-based applications. In an object-oriented structure, an object consists of data values describing the attributes of an entity plus the operations that can be performed upon the data. This encapsulation capability allows the object-oriented model to better handle more complex types of data (graphics, voice, text) than other database structures. Supports inheritance, that is, new objects can be automatically created by replicating some or not all of the characteristics of one or more are objects. Object capabilities and inheritance have made object-oriented database management systems (OODBMS) popular in computer-aided design (CAD) applications. Designers can develop product designs, store them as objects in an object-oriented database, and replicate and modify them to create new product designs. Multimedia web-based applications for the Internet and corporate Intranets and extranets have become a major application area for object technology.

5.8

Object technology and the web

Object-oriented database software is finding increased use in managing the hypermedia databases and Java applets on the World Wide Web and corporate Intranets and extranets. Industry proponents predict that object-oriented database management systems (OODBMS) will become the key software component that manages the hyperlinked multimedia pages and other types of data that support corporate web sites.

5.9

Accessing databases

Databases and data files are stored on various types of storage media and are organized in a variety of ways to make it easier to access the data records they contain. In database maintenance, records or objects have to be continually added, deleted, or updated to reflect business transactions, and they also need to be accessed so information can be produced in response to end user requests. Key Fields: Records usually contain one or more identification fields, or keys that identify the record, so that it can be located. Other methods also identify and link data records stored in several different database files. Hierarchical and network databases may use pointer fields. These are fields within a record that indicate (point to) the location of another record that is related to it in the same file, or in another file. Hierarchical and network database management systems use this method to link records so they can retrieve information from several different database files. Relational database management packages use primary keys to link records. Each table (file) in a relational database must contain a primary key. This field uniquely identifies each record in a file and must also be found in other related files. Sequential Access: One of the basic ways to access data is sequential access. This method uses a sequential organization, in which records are physically stored in a specified order according to a key field in each record. Advantages of sequential access: It is fast and efficient when dealing with large volumes of data that need to be processed periodically. Disadvantages of sequential access: Requires that all new transactions be sorted into the proper sequence for sequential access processing. Locating, storing, modifying, deleting or adding records in the file requires rearranging the file. Too slow to handle applications requiring immediate updating or responses. Direct Access:

When using direct access methods, records do not have to be arranged in any particular sequence on storage media. Characteristics of the direct access method: Computers must keep track of the storage location of each record using a variety of direct organization methods so that data can be retrieved when needed. New transactions data do not have to be sorted. Processing that requires immediate responses or updating is easily handled. Three common ways to directly access records in the direct organization method include: Key Transformation: - This method performs an arithmetic computation on a key field or record and uses the number that results from that calculation as an address to store and access that record. Index: - This method uses an index of record keys and related storage addresses. A new data record is stored at the next available location, and its key and address are placed in an index. The computer uses this index, whenever it must access a record. Indexed Sequential Access Method (ISAM): - In this method, records are physically stored in sequential order on a magnetic disk or other direct access storage device based on the key field of each record. Each file contains an index that references one or more key fields of each data record to its storage location address.

5.10

Database development

Developing small personal databases is relatively easy using microcomputer DBMS packages. However, developing a large database can be a complex task. In many companies, developing and managing corporate databases is the primary responsibility of the database administrator and database design analysts. They work with end users and systems analysts to determine: What data definitions should be included in the database What structure or relationships should exist among the data elements? Database development must start with a top-down data planning process. Database administrators work with corporate and end user management according to the following steps: Develop an enterprise model to define the basic business processes of the enterprise. Define the information needs of end users in a business process. Identify the key data elements that are needed to perform their specific business activities. Develop entity relationship diagrams (ERDs) that model the relationships among the many entities involved in the business process.

The user views become the basis for the data modeling steps where the relationships between data elements are identified. Each data model defines the logical relationships among the data elements needed to support a basic business process. These data models then serve as logical frameworks (schemas and sub schemas) on which to base the physical design of databases and the development of application programs to support the business processes of the organization. Data Models - Represent a logical view of the data and relationships of the data. Schema - Is an overall logical view of the relationships between data in a database. Subschema - Is a logical view of data relationships needed to support specific end user application programs that will access that database. Physical or Internal View - Looks at how data is physically arranged, stored, and accessed on the magnetic disks and other secondary storage devices of a computer system.

5.11 5.12

The internet and business Introduction

Electronic Commerce encompasses the entire online process of developing, marketing, selling, delivering, servicing, and paying for products and services. The Internet and related technologies and e-commerce websites on the World Wide Web and corporate intranets and extranets serve as the business and technology platform for e-commerce marketplaces for consumers and businesses in the basic categories of business-to-consumer (B2C), (C2C) e-commerce. The essential processes that should be implemented in all e-commerce applications across control and security, personalizing and profiling, search management, content management, catalog management, payment systems, workflow management, event notification, and collaboration and trading.

5.13

Business use of the internet

Business use of internet has expanded from an electronic information exchange to a broad platform for strategic business applications. These applications like collaboration among business partners, providing customer and vendor support, and electronic commerce have become major business use of the internet. Companies are also using internet technologies for marketing, sales and customer relationship management applications, as well as cross functional business applications, and applications in engineering, manufacturing, human resource, and accounting division. 5.14 Interactive marketing

The explosive growth of Internet technologies has had a major impact on the marketing function. The term interactive marketing has been coined to describe a type of marketing that is based on using the Internet, intranets, and extranets to establish two-way interaction between a business and its customers or potential customers. The goal of interactive marketing is to enable a company to profitably use those networks to attract and keep customers who will become partners with the business in creating, purchasing, and improving products and services. Interactive marketing: Customers are not passive participants, but are actively engaged in a network-enabled proactive and interactive process. Encourages customers to become involved in product development, delivery, and service issues. Enabled by various Internet technologies, including chat and discussion groups, web forms and questionnaires, and e-mail correspondence. Expected outcomes are a rich mixture of vital marketing data, new product ideas, volume sales and strong customer relationships. Targeted Marketing Targeted marketing has become an important tool in developing advertising and promotion strategies for a companys electronic commerce websites. Target marketing is an advertising and promotion management concept that includes five targeting components: Community companies can customize their web advertising messages and promotion methods to appeal to people in specific communities. These can be communities of interest, such as virtual communities of online sporting enthusiasts or arts and crafts hobbyists, or geographic communities formed by the websites of a city or local newspaper. Content advertising such as electronic billboards or banners can be placed on various website pages, in addition to a companys home page. These messages reach the targeted audience. Context advertising appears only in web pages that are relevant to the content of a product or service. So advertising is targeted only at people who are already looking for information about a subject matter that is related to a companys products. Demographic/Psychographic marketing efforts can be aimed only at specific types or classes of people: unmarried, twenty-something, middle income, and male college graduates. Online Behavior advertising and promotion efforts can be tailored to each visit to a site by an individual. This strategy is based on web cookie files recorded on the visitors disk drive from previous visits. Cookie files enable a company to track a persons online behavior at a website so marketing efforts can be instantly developed and targeted to that individual at each visit to their website. Sales Force Automation: Increasingly, computers and networks are providing the basis for sales force automation. In many companies, the sales force is being outfitted with notebook computers that connect them to Web browsers, and sales contact management software that connect them to marketing websites on the Internet, extranets, and their company intranets.

Characteristics of sales force automation include: Increases the personal productivity of salespeople. Dramatically speeds up the capture and analysis of sales data from the field to marketing managers at company headquarters. Allows marketing and sales management to improve the delivery of information and the support they provide to their salespeople. Many companies view sales force automation as a way to gain a strategic advantage in sales productivity and marketing responsiveness.

5.15

The business value of the internet

An Organization can develop their business online. All departments like HR, Marketing, and Finance data can be saved at the centralized s data can be retrieved easily. 5.16 Customer value and the internet

Customer Relationship Management: The Business Focus - Customer relationship management is a cross- functional enterprise system that integrates and automates many of the customer serving processes in sales, marketing, and customer service that interact with a companys customers. CRM systems use information technology to support the many companies who are reorienting themselves into customer-focused businesses as a top business strategy. The major application components of CRM include contact and account management, sales, marketing and fulfillment, customer service and support, and retention profitable relationships with its customers as a primary business goal. However, many companies have found CRM systems difficult to properly implement due to lack of adequate understanding and preparation by management and affected employees. Finally, many companies are moving toward collaborative CRM systems that support the collaboration of employees, business partners, and the customers themselves in enhancing profitable customer relationships.

5.17

Fundamentals of electronic commerce

Electronic Commerce systems introduce the basic process components of e-commerce systems, discuss important trends, applications, and issue in e-commerce.

5.18

Foundations of electronic commerce

Electronic commerce is more than just buying and selling products online. Instead, it encompasses the entire online process of developing, marketing, selling, delivering, servicing, and paying for products and services purchased by internet worked, global marketplaces of customers, with the support of a worldwide network of business partners. Electronic commerce systems rely on the resources of the Internet, intranets, extranets, and other computer networks. Electronic commerce can include: Interactive marketing, ordering, payment, and customer support processes at e-commerce sites on the World Wide Web. Extranet access of inventory databases by customers and suppliers. Intranet access of customer relationship management systems by sales and customer service reps. Customer collaboration in product development via Internet newsgroups and e-mail exchanges.

5.19

Electronic commerce applications

The buying and selling, marketing and servicing and delivery and payment of products, services, and information over the internet, intranets, extranets, and other networks, between an internet- worked enterprise and its prospects, customers, suppliers, and other business partners. It includes business-to-consumer, business-to-business and consumer-to-consumer. 5.20 Business-to-consumer commerce

Electronic commerce on the Internet between businesses and consumers is accelerating the impact of information technology on consumer behavior and business processes and markets. A basic fact of Internet retailing (e - tailing) is that all web sites are created equal as far as the location, location, location imperative of success in retailing is concerned. No site is any closer to its customers and competitors offering similar goods and services may be only a mouse click away. This makes it vital that businesses find ways to build customer satisfaction, loyalty, and relationships, so keep customers coming back to their Web stores. The key to e-tailing success is to optimize factors such as: Selection and value Performance and service efficiency Look and feel of the site Advertising and incentives to purchase Personal attention Community relationships Security and Reliability

WEB STORE REQUIREMENTS Most business-to-consumer e-commerce ventures take the form of retail business sites on the World Wide Web. The primary focus of such e-tailors is to develop, operate, and manage their websites to they become high-priority destinations for consumers who will repeatedly choose to go there to buy products and services. Developing a Web Store In order to launch your own retail store on the Internet, you must: Build an e-commerce website. Many companies use simple website design software tools and pre-designed templates provided by their website hosting service to construct their Web retail store. Larger companies can use their own software developers or hire an outside website development contractor to build a custom- designed ecommerce site. Develop your website as a retail Web business by marketing it in a variety of ways that attract visitors to your site and transform them into loyal Web customers. Serving Your Customers: Once your retail store is on the Web and receiving visitors, the website must help you welcome and serve them personally and efficiently so that they become loyal customers. Most e-trailers use several website tools to create user profiles, customer files, and personal Web pages and promotions that help them develop a one-to-one relationship with their customers. This can be done by: Creating incentives to encourage visitors to register Develop Web cookie files to automatically identify returning visitors Contracting with website tracking companies for software to automatically record and analyze the details of the website behavior and preferences of Web shoppers. Ensure that your website has the look and feel of an attractive, friendly, and efficient Web store. Managing a Web Store A Web store must be managed as both a business and a website, and most e-commerce hosting companies offer software and services to help you do just that. For example service providers can offer their clients: A variety of management reports that record and analyze Web store traffic, inventory, and sales results. Build customer lists for e-mail and Web page promotions, or provide customer relationship management features to help retain Web customers. E-commerce software includes links to download inventory and sales data into accounting packages. Twenty-four hours a day and seven day a week operation all year long. Password and encryption protection of Web store transactions and customer records, and employ firewalls and security monitors to repel hacker attacks and other security threats. Provide clients twenty four hour tech support to help them with technical problems

5.21

Business-to-business commerce

Business-to-business electronic commerce is the wholesale and supply side of the commercial process, where businesses buy, sell, or trade with other businesses. B2B electronic commerce relies on many different technologies, most of which are implemented at e-commerce websites on the World Wide Web and corporate intranets and extranets. B2B applications include: Electronic catalog systems Electronic trading systems such as exchange and auction portals Electronic data interchange Electronic funds transfers

Many businesses are integrating their Web-based e-commerce systems with their e-business systems for supply chain management, customer relationship management, and online transaction processing, as well as to their traditional, or legacy, computer-based accounting and business information systems. This ensures that all electronic commerce activities are integrated with e-business processes and supported by up-to-date corporate inventory and other databases, which in turn are automatically updated by Web sales activities. Businesses of any size can now buy at business-to-business e-commerce marketplaces. A number of e-commerce marketplaces are used by businesses today. Many B2B e-commerce portals provide several types of marketplaces. For example: An electronic catalog shopping and ordering site for products from many suppliers in an industry. An exchange for buying and selling at negotiated prices. An auction website for business-to-business auctions or products and services. These B2B e-commerce portals are developed and hosted by third-party market maker companies who serve as infomediaries that bring buyers and sellers together in catalog, exchange, and auction markets. Infomediaries are companies that serve as intermediaries in e-business and e-commerce transactions. Business value of using B2B e- commerce infomediary companies include: Ability to makes business purchasing decisions faster, simpler, and more cost effective. Business buyers get one-stop shopping, accurate purchasing information, and impartial advice from infomediaries that they cant get from the sites hosted by suppliers and distributors. Businesses can negotiate or bid for better prices from a larger pool of vendors. Suppliers benefit from easy access to customers from all over the globe. 5.22

Electronic payments and security

Payments for the products and services purchased are an obvious and vital step in the electronic commerce transaction process. Concerns of electronic payments and security include: The near-anonymous electronic nature of transactions taking place between the networked computer systems of buyers and sellers, and the security issues involved. Electronic payment process is complex because of the wide variety of debit and credit alternatives and financial institutions and intermediaries that may be part of the process. Varieties of electronic payment systems have evolved. New payment systems are being developed and tested to meet the security and technical challenges of electronic commerce over the Internet. Electronic Funds Transfer: systems are a major form of electronic commerce systems in banking and retailing industries. EFT systems use a variety of information technologies to capture and process money and credit transfers between banks and businesses and their customers

Secure Electronic Payments: When customer makes an online purchase on the Internet, your credit card information is vulnerable to interception by network sniffers, software that easily recognizes credit card number formats. Several basic security measures are being used to solve this security problem. They include: Encrypt (code and scramble) the data passing between the customer and merchant Encrypt the data passing between the customer and the company authorizing the credit card transaction. Take sensitive information offline