Transcript INTERNET & GLOBALIZATION

Seminar in E-Business
New x (Economy +Business Rules + Customers + etc.)
EXECUTIVE DEVELOPMENT PROGRAM
Şule Özmen
Marmara University
Department of Business Administration
[email protected]
[email protected]
LECTURE 1
AGENDA
 New (Digital) Economy
 New Business Rules
 Internet and Globalization
 E-Business, e-commerce
 Redefining Business
 Customers in Digital Economy
 Myths and Realities
Old Economy -
New Economy
 Old business rules
 New business rules
 Old business models
 New business models
 Old customers
 New customers
?
?
REALLY?
The New Economy –Digital Economy
Industry era
Information era
Biological era
 Information economy
– First stage (based on computers)
• Data processing, spreadsheets, word processing
– Second stage ( based on networks)
• Connectivitiy, networks and teradata
Business Rules in New Economy
 Time –Speed
– Time between business processes gets shorter
– real time responses
 Space - Distance
– Connectivity decreased the importance of locations
 Value – Intangibles
– Economic value shifted from tangibles to intangibles
value is added by information (CRM,SCM)
Consumers are empowered
Business Rules in New Economy
(continued)
 Value comes from abundance rather than
scarcity (ecomomic value was stemming from scarcity
in old economy). The more connection the more
value gained.
 Factors of production
– Talent, innovation also become the factors of
production
INTERNET & GLOBALIZATION
 Geographical distances have been overcome
by the internet technologies
(Neither central management nor ownership)
 Markets expanded. Global Markets.
 Purchasing manufacturing marketing can be
achieved at any convenient places.
 Global competition. Global markets
changed who are the competitors.
E-conomy, e-business
e-commerce, e-competition
 Sense
 Process WHY???
 Respond Traditional : Make and sell
New: Sense and respond
HOW ?????
By e-commerce, by e-business, by new
business models
CRM, SCM, ERP, Data Warehousing
Definition of e-business
 e-business is a new way of doing business on the
e-economy.
 Key business processes are transformed for this
new way of doing business through the extensive
use of computer and internet technologies
 e - business involves openness, connectivity and
integration
Saying electronic commerce is merely buying and selling
products on the World Wide Web is like arguing the PC
makes a good typewriter
Transformation of business to
e-business
 Changing the way of doing business, business
tasks
 Changing the organization’s business model
 Changing the way of performing the managerial
functions and activities
Key success factors
 Vision, leadership, commitment
 Strategy and management
It is both cheaper and profitable to absolete yourself than it
is to let your competitor do it for you
Peter Drucker
e-business reconstruct value chains
e-business adds value for everyone involved in all the
way throughout the chain. what we call the value
chain, which is the interconnection of raw
materials suppliers, through manufacturers, all the
way out to the retailers and the consumers.
Businesses, customers, producers, suppliers,
employees, managers,
Suppliers, supplier’s supplier, customers, customer’s customer
Benefits, ease, convenience, timely, cheaper,
higher quality, etc.
Impact of e-economy, e-business ecommerce on consumers and
marketers
 What type of changes
are you expecting in
purchasing behavior of
consumers
– ?
– ?
– ?
 What do you
propose to
marketers to do?
– ?
– ?
– ?
Who is your customer in digital
economy?
 Who doesn’t buy every product or service you
offer like in “old good days”

Equipped with information
Less brand loyal,
runs away to your
rival by a click
But when? if not
satisfied
Redefinition of business
 Products and services (offers) are redefined
(info. about the product or the service can
be more valuable than the product itself)
 Market (buyers) are redefined
 Web borned business models arised.
 Relationships are redefined
– B2B, B2C, C2C
– Supply Chain Management
– Customer Relationship Management
MYTHS AND REALITIES of EBusiness Lecture 2
We will discuss and comment on whether
 E-Business is easy or not
 E-business is expensive or inexpensive
 Everyone is doing it
 It is lucrative or not
 The Web levels the playing field.
 It leads disintermediation
 It means the end of mass marketing
 It leads to product commodization
AFTER summarizing the phases of business on the
road of e-Business
From Web Presence to e-Business
 Having a web site
 Having a web site + Search engine on site
 Trying e-commerce
 Doing e-business
MYTHS AND REALITIES
 MYTH NO. 1: It's Easy.
The Barriers To Entry Have Never Been Lower. Yes, putting
up a Web site is easy. And putting up a Web site to handle
commerce transactions is pretty easy, too. But add words
like effective, scalable, and successful, and it gets a lot
harder.
 MYTH NO. 2: It's cheap.
Perhaps E-commerce is cheap when compared with a fullblown enterprise resource planning implementation or the
purchase of a mainframe. But for a number of reasons, a
full-scale online commerce effort is never a low-cost
proposition.
Source:
http://www.informationweek.com/712/12iumyt.htm
MYTHS AND REALITIES (Continued)
 MYTH NO. 3: Everyone's doing it.
 MYTH NO. 4: It's lucrative.
Despite the online sales success of a handful
of E-commerce poster children, for every Dell
Computer and Cisco Systems there are
dozens of companies like Burlington Coat
Factory. The company's Web site sells less
merchandise than just one of its 250 retail
stores, says CIO Mike Prince. "So far, it just
hasn't been a major focus for us," he says.
MYTHS AND REALITIES (Continued)
 MYTH NO. 5: The Web levels the playing field.
Startups Can Instantly Compete On The Same Footing As
Long-Established Companies.
With a few notable exceptions, such as Amazon, E-Trade, and
online greeting-card maker Blue Mountain Arts, the biggest Ecommerce players are big, established companies: Cisco,
Disney, Dell, Microsoft, Charles Schwab. Companies that want
to be successful at Web commerce need the marketing clout,
brand identity, and scale to do back-end fulfillment and customer
service--and above all, they need the capital (see Myth No. 2).
That's why so many startups are either merging (like music
retailers CDNow and N2K) or are being bought by big physicalworld competitors (note Reel.com's acquisition by Hollywood
Video).
MYTHS AND REALITIES (Continued)
 MYTH NO. 6: It leads to disintermediation.
The theory was simple: The Web provides
an instant global sales channel to all
producers of goods and services, so why use
conventional distributors, resellers, and other
middlemen when you can sell directly? Well,
it simply hasn't happened, for three main
reasons: the actions of producers, the actions
of distributors, and the rise of dozens of new
intermediaries on the Web, giving rise to the
second-generation buzzword
"reintermediation."
MYTHS AND REALITIES (Continued)
 MYTH NO. 7: It means the end of mass
marketing.
Once again, the theory is simple enough:
The Web is the first communications channel
that enables cost-effective one-to-one
marketing on a huge scale. Marketing to a
"segment of one" has long been the goal of
database marketing, data mining, and
telemarketing, but Web technology enables
marketing of unprecedented exactitude and
low cost.
MYTHS AND REALITIES (Continued)
 MYTH NO. 8: It leads to product
commodization.
Some disciples of this dogma point to
Priceline.com, the site where consumers set
the price they want to pay, then let airlines
and other suppliers compete to meet that
price. Certainly, it's an innovative model that
wouldn't be possible without the Web. Online
auction sites such as OnSale and eBay have
also been successful and have their place for
some types of products. But price isn't the
No. 1 selling point for most companies online.