Chapter 2
Chapter 2
Chapter 2
Learning objectives:
1. what are the main actors and stakeholders in the area of E-Commerce.
2. how the fundamental sales process works.
3. what are the technological elements, which are characteristic for E-
Commerce and have enabled the big success of E-Commerce.
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2. E-COMMERCE Frameworks and architectures
Outline
Actors and stakeholders
Fundamental sales process
Technological elements
Exercises
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1. Actors and stakeholders
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Cont’d….
According to the specific nature of the interacting partners we talk about X2Y
business where X and Y belong to the above-mentioned categories.
We only talk about X2Y business if there is an interchange of goods or services
and money.
The supplier provides goods or services, the customer, be it a consumer or another
business, has to forward an appropriate amount of money to the supplier.
This is done on the base of a contract (be it a written or an oral contract).
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Actors and stakeholders
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Actors and Cont’d…
Doing business can be mainly considered via two questions.
Who is the initiator or driver of the business transaction?
E-commerce ->supplier driven
E-procurement(purchasing department of a company)-
customer driven
What is the nature of the transaction?
B2C or
B2B
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2.2 FUNDAMENTAL SALES PROCESS
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SALES PROCESS cont’d…
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2.2 FUNDAMENTAL SALES PROCESS
In general we will denominate the provider of goods or services as the supplier and the
receiver of goods or services as the customer.
Sometimes third parties are involved, e.g. shipping agents, which are denominated
specially.
The steps and sub-steps of the primary process, including the responsible party (see figure
2), are:
Information step:
Search for products and services: by the customer
Search for potential suppliers: by the customer
Search for potential customers: by the supplier
Communicate an offering: by the supplier
Communicate a need: by the customer
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2.2 FUNDAMENTAL SALES PROCESS
Initiation step:
Get into contact: either by the customer or by the supplier
Request for delivery or service: by the customer
offer for delivery or service: by the supplier
Assess supplier: by the customer
Assess customer: by the supplier
Contract conclusion step:
Negotiate offer: by supplier and customer
Negotiate contract: by supplier and customer
Place order: by the customer
Confirm order: by the supplier
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2.2 FUNDAMENTAL SALES PROCESS
Delivery/fulfillment step:
Proceeding for physical goods:
Pack goods: by the supplier,
Load goods: by the supplier,
Ship goods: by the shipping agent,
Unload goods: by the shipping agent,
Unpack goods: by the customer or the shipping agent or a specific service
provider,
Assemble complex equipment at the customer’s site: by the shipping agent or a
specific service provider,
Accept delivery: by the customer,
Approve contract fulfillment to authorize billing: by the customer,
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2.2 FUNDAMENTAL SALES PROCESS
Delivery/fulfillment step:
Proceeding for physical services:
Build and maintain service fulfillment capability: by the supplier
Come together physically because customer must be an active part in service
delivery: by the supplier and the customer
Dene service levels: by the supplier, possibly after a negotiation with the customer
Add service level agreement to contract: by the supplier
Accept service fulfillment: by the customer
Approve contract fulfillment to authorize billing: by the customer
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2.2 FUNDAMENTAL SALES PROCESS
Delivery/fulfilment step:
Proceeding for digital goods::
Send goods to the customer via the net or provide for download: by the supplier
Protect goods against unauthorized access (see chapter 6 of this book): by the
supplier
Accept delivery or confirm successful download: by the customer
Approve contract fulfillment to authorize billing: by the customer
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2.2 FUNDAMENTAL SALES PROCESS
Delivery/fulfillment step:
Proceeding for digital services::
Provide service via the net: by the supplier
Define service levels: by the supplier, possibly after a negotiation with the
customer
Add service level agreement to contract: by the supplier
Initiate service provision: by the customer
Accept service fulfillment: by the customer
Approve contract fulfillment to authorize billing: by the customer
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Cont’d…
Billing/invoicing step:
Generate invoice: by the supplier,
Generate attachments to invoice (e.g. protocol of service fulfillment, protocol of
final customer’s approval, certificates, etc.): by the supplier
Forward invoice to customer (via the Web or via postal services): by the supplier
Payment step::
Get money from the customer by the supplier or a financial services provider
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Cont’d…
Service/support step:::
Provide additional information for the customer (e.g. user manual, technical
documentation, etc.): by the supplier.
Conduct customer support (e.g. recommendation for usage, FAQ, etc.): by the
supplier
Manage complaints: by the supplier
Repair: by the supplier or a specific service provider
Manage returns (if repair is necessary, a wrong product has been delivered or
customer wants to roll back the business): by the supplier in cooperation with the
customer
Conduct maintenance (may be part of the product or may be a separate service
offered by the supplier): by the supplier or a specific service provider.
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2.2.2 SECONDARY PROCESS
The secondary process (see figure 3) can be sub-divided into
Internal process control,
Communication to the customer:
Tracking & tracing: by the supplier or the shipping agent,
Inform about order processing status: by the supplier,
Announce delivery time: by the supplier or the shipping agent.
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2.3 TECHNOLOGICAL ELEMENTS
In this chapter we will discuss subjects IT people are talking about
Technology is a major enabler of E-Commerce as we consider it here. Globally
accepted technological standards have been and still are a prerequisite and a driver of
global electronic business. Here we will follow a technology model with four layers.
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2.3.1 BASIC TECHNOLOGIES
TCP/IP
TCP/IP is an abbreviation and stands for Transmission Control Protocol/Internet
Protocol.
This twin protocol describes the transportation of data in the Internet and was introduced
in 1978 by the USA-DoD (Department of Defence) as a standard for heterogeneous
networks.
TCP/IP is part of the following 4-layer protocol:
Layer 1: Local network/network access
This layer corresponds to the first layer (physical layer) and the second layer (data link)
of the ISO/OSI seven layer model (ISO = International Standards Organization, OSI =
Open Systems Interconnection).
Available technologies are:
FDDI (Fiber Distributed Data Interface), which has a ring structure, provides a
transmission rate up to 100 MBit/sec.
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Cont’d….
Token Ring
which also has a ring structure, in which the token-possession grants the possessor
permission to transmit on the medium, is an advancement of FDDI.
It is defined by the standard IEEE 802.5 (IEEE = Institute of Electrical and Electronics
Engineers),
Ethernet
which has the widest propagation now, actually is the primary technology.
It provides transmission rates up to 10 Gigabit/sec (Access is carried out via
CSMA/CD = Carrier Sense Multiple Access/Collision Detection; technology is based
on standard IEEE 802.3).
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Layer 2: Internet (IP)
This is the address layer, corresponding to the third layer (network layer) in the ISO/OSI
seven layer model.
IPv4
(Internet Protocol version 4) is the fourth version of the Internet Protocol (IP).
It is one of the core protocols of standards-based internetworking methods .
IPv4 is a connectionless protocol for use on packet-switched networks.
No permanent physical link between participants of the network is necessary.
It operates on a best effort delivery model, in that it does not guarantee delivery, nor
does it assure proper sequencing or avoidance of duplicate delivery.
IPv4 has a length of 4 Bytes respectively 32 bits
IPv6
(Internet Protocol version 6) is the most recent version of the Internet Protocol (IP)
The communications protocol that provides an identification and location system for
computers on networks and routes traffic across the Internet.
IPv6 uses a 128-bit address, allowing 2128 addresses, or more than 7.9×1028 times as 21
many as IPv4.
Layer 3: Host-to-Host (TCP)
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Layer 4: Process/Application
This layer corresponds to some layers of the ISO/OSI seven layer model:
session layer (5), presentation layer (6) and application layer (7).
It includes several protocols, which will be discussed subsequently.
HTTP (Hypertext Transfer Protocol)
FTP (File Transfer Protocol)
SMTP (Simple Mail Transfer Protocol)
WWW (World Wide Web)
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2.3.2 MIDDLEWARE
Middleware consists of technologies building the link between hardware and application
software.
The boundaries between middleware and hardware as well as between middleware and
application software are changing over time due to the technological development.
Middleware normally is a category of general and not application specific software.
CORBA (Common Object Request Broker Architecture)
CORBA is a standard defined by the Object Management Group (OMG) designed to
facilitate the communication of (software) systems that are deployed on diverse platforms.
CORBA enables collaboration between systems on different :-
operating systems
programming languages
and computing hardware.
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MIDDLEWARE Cont’d
Database systems
In a business environment we often use a relational database system, which is optimally
suited to store and process structured data as we find it in typical business transactions.
Typical examples for structured data are:
Address data
Orders
Shipping documents
Invoices
Tax declarations.
Webserver
A Webserver is a virtual computer (a piece of software), which helps to deliver Web content
that can be accessed through the Internet.
Well-known products are:
Apache HTTP Server
Microsoft Internet Information Services (IIS). 25
MIDDLEWARE Cont’d
WSDC
web service description language
XML based interface definition language that is used for describing the functionality
offered by a web service
SOAP
simple object access protocol
Protocol specification for exchanging structured information in the implementation
of web services in computer networks.
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2.3.3 PLATFORMS/FRAMEWORKS
Portal
A portal is a central entry and navigation point to provide access to a virtual area (of
applications or services) and to deliver additional information to the user.
It works as an interface between user and system(s).
Often portals are seen as the platform for an E-Commerce-strategy.
CMS
Content management system.
Application software that allow publishing .editing and modifying content ,organizing ,
deleting as well as maintenance form a central interface
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Typical Applications
General software architecture for the E-commerce area
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EXERCISES
2.4.1 QUESTIONS FOR YOUR SELF-STUDY
Q2.01:
Compare the fundamental sales process as it has been shown here to your daily life and the
traditional sales process.
What is different?
What is new?
What is missing?
Q2.02:
How much should a business manager know about technical subjects?
What is need to know?
What is nice to know?
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End of Slides…
Thank you..
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Questions..?
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