Management Information System Comprehensive and Organized

1. Management Information SystemComprehensive and Organized Chapter 14 eCommerce and eGovernance

2. Chapter Highlights • e-Commerce definition • Brokerage Model • e-Commerce and EDI • eCash, eCheque and eMarketing • e-Commerce business models, B2B, B2C, C2B • Popular e-Commerce sites • eTailing • Advantages and disadvantages of e-Commerce • mCommerce • Mobile Wallets • eProcurement, eLogistics • eAuctions • Bitcoins and Blockchains • eGovernance

3. eCommerce Definition ecommerce or electronic commerce is the buying and selling of goods and services It is commercial transactions or the transmitting of funds or business data, over an electronic network, primarily the internet. These business transactions occur either as business-to-business, business-to-consumer, consumer-to-consumer or consumer-to-business. The terms e-commerce and e-business are often used interchangeably. 

4. eCommerce eCommerce has redefined, redesigned the concept of retail as well as business to business transactions streamlining interactions, products and payments from customers to companies and from companies to suppliers. Backed by increased online user base and mobile phone penetration, Indian eCommerce has seen impressive growth in the last few years. eCommerce sector in India has grown by 34% since 2009 to touch US$16.4 billion in 2014 out of which eTailing’s share is US$3.5 billion. This sector is expected to be in the range of US$22 billion in 2015. (Source: Dataquest, March 31 2015).

5. eCommerce Out of the many approaches that comprise the business models, brokerage model is the simple one used to describe how companies go about this process. There are different scenarios or business configurations fall under the banner of a brokerage model. For example: Advertising revenue model – fees generated from advertisers Sales revenue model – On line sales of goods and services Transaction fees revenue model – The revenue is generated through transaction fees by the customer paying a fee for a transaction to the operator of a platform Subscription revenue model - Users are charged a periodic (daily, monthly or annual) fee to subscribe to a service

6. Electronic Data Interchange (EDI) EDI provides standards for exchanging data via any electronic means. Complying with the same standard, two different companies, even in two different countries, can electronically exchange documents (such as purchase orders, invoices, shipping notices, and many others). EDI is the computer-to-computer interchange of strictly formatted messages that represent documents other than monetary instruments. EDI implies a sequence of messages between two parties, either of whom may serve as originator or recipient

7. Electronic Data Interchange (EDI) EDI facilitates the benefit time and cost saving to a company by providing an alternative to, or replacing, information flows that require a great deal of human interaction and paper documents. Although paper documents are maintained in parallel with EDI exchange For example printed shipping manifests, electronic exchange and the use of data from that exchange reduces the handling costs of sorting, distributing, organizing, and searching paper documents and saves paper as well.

8. Electronic Data Interchange (EDI) To facilitate EDI, a Value Added Network (VAN) - a private network provider is widely used. VAN is sometimes called a turnkey communications line, is hired by a company to facilitate electronic data interchange (EDI) or other network services. VAN is a private network provider hired by a company to facilitate EDI and/or provide other network services such as message encryption, secure email and management reporting. A Value-Added Network (VAN) simplifies the communications process by reducing the number of parties with which a company needs to communicate.

9. EDI Applications in Industry Retail: While the retail sector has been at the forefront of EDI adoption has replaced many paper-based processes with electronic documents Healthcare: In the healthcare industry, electronic attachments for insurance claims are just one type of EDI in healthcare Logistics: EDI in the logistics industry is used for freight forwarders, NVOCCs, customs brokers, container freight stations, ships agents, warehouses, cartage and trucking companies Banking: The Society of Worldwide Interbank Financial Telecommunication (SWIFT) was formed in 1973 and is headquartered in Brussels. SWIFT operates a worldwide financial messaging network which exchanges messages between banks and financial institutions

10. eCash and eCheque eCash is the brainchild David Chaum. It is as an anonymous electronic money or electronic cash system in 1983 realized through his corporation Digicash There are two models of eCash: On-line form of eCash (introduced by DigiCash) which allows for the completion of all types of internet transactions and the other form is Off-line form of eCash, essentially a digitally encoded card that could be used for many of the same transactions as cash eCheque is a payment that you make directly from your bank account. It is an electronic funds transfer that withdraws money directly from your bank account. It is just like writing a cheque, only it is done electronically

11. eMarketing In the era of digital economy, eMarketing means leveraging the strength of Internet and digital media for marketing products or services. These digital technologies are a valuable addition to traditional marketing approaches regardless of the size and type of your business. eMarketing is also known as Internet marketing, marketing or web-marketing. Objective of eMarketing is creating a strategy that helps businesses deliver the right messages and product/services to the right audience.

12. eMarketing eMarketing joins creative and technical aspects of the Internet, including: design, development, advertising and sales. It includes the use of a website in combination with online promotional techniques such as search engine marketing (SEM), social medial marketing, interactive online ads, online directories, e-mail marketing, affiliate marketing, viral marketing and so on. The digital technologies used as delivery and communication mediums within the scope of e-marketing include: Internet media such as websites and e-mail Digital media such as wireless, mobile, cable and satellite. One of the measures for evaluating the success or failure of eMarketing is Click Through Rate (CTR). The purpose of click-through rates is to measure the ratio of clicks to impressions of an online ad or email marketing campaign

13. eCommerce Business Models Most companies today are participating in or sponsoring four basic categories of electronic commerce applications: Business to consumer (B2C) Consumer to business (C2B) Business to business (B2B) Consumer to consumer (C2C) B2C and C2C transactions take place through eTailing whereas B2B transactions are carried out through eProcurement, eLogistics.

14. B2C Model

15. B2B Model

16. C2B Model

17. B2B Model

18. eTailing eTailing is retailing conducted online. eTailers who sell on the net. Examples are travel, hardware, software, books, music, games, insurance etc. There are 2 major types of eTailers Pure play eTailing where transactions are only on the web site in online mode Click and mortar Apart from web transaction, the retailers also have physical transactions in their store. Examples of pure play Amazon.com selling books, click and mortar is Barnes and Noble, Indian Railways reservation system.

19. Advantages and Disadvantages of eCommerce Advantages • Minimal investment • Comfortable and easy to use - user friendly • Time saving • Customer interactions • Mass media • Search option • Customized product placement • Global Reach Disadvantages • Security issues • Customer retention • Unsuitable for certain product categories • Shopping is still a touch-feel-hear experience • Complicated medium • Navigational hiccups • Website design flaws • Limited access to Internet

20. Popular eCommerce Sites Popular online shopping companies, offering genuine products to people. They have huge stock of innumerable products like clothes, music, electronics, books etc. Flipkart.com SnapDeal.com Amazon.in eBay.in Online travel ticketing and hotel booking irctc.co.in MakeMyTrip.com Yatra.com

21. mCommerce Mobile commerce was originally coined in 1997 by Kevin Duffey at the launch of the Global Mobile Commerce Forum, to mean “Delivery of electronic commerce capabilities directly into the consumer’s hand, anywhere, via wireless technology.” Due to growing mobile Internet penetration over the past few years, the country has seen a staggering rise in everyday transactions carried out via mobile devices. A recent report released by market research firm Zinnov estimated that India’s market for mobile commerce would expand from $2 billion in 2014 to $19 billion by 2019.

22. mCommerce Some of the examples of m-Commerce are discussed here. Mobile ticketing Mobile vouchers, coupons and loyalty cards Content purchase and delivery Currently, mobile content purchase and delivery mainly consists of the sale of ring-tones, wallpapers, and games for mobile phones Location-based services Information services A wide variety of information services can be delivered to mobile phone users in much the same way as it is delivered to PCs. These services include: Stock quotes Financial records

23. mCommerce Mobile banking Banks and other financial institutions use mobile commerce to allow their customers to access account information and make transactions, such as purchasing stocks, remitting money. This service is often referred to as mobile banking, or m-banking. IMPS is one of the examples of mobile banking. Mobile brokerage Stock market services offered via mobile devices have also become more popular and are known as Mobile Brokerage. Auctions Over the past three years mobile reverse auction solutions have grown in popularity. Unlike traditional auctions, the reverse auction (or low-bid auction) bills the consumer’s phone each time they place a bid. Mobile purchase Catalog merchants can accept orders from customers electronically, via the customer’s mobile device. In-application mobile phone payments Payments can be made directly inside of an application running on a popular smartphone operating system, such as Google Android.

24. Mobile Wallets As shopping patterns continue to evolve, so does the payment platform industry that propels the former supported by information technology. Mobile wallet is a variant of m-Commerce. It is the digital equivalent to the physical wallet we already have in our pockets/bags today. Broadly there are four types of mobile wallets: Closed wallets (not reloadable with cash and do not permit cash withdrawal, for instance pre-paid and gift vouchers) Semi-closed wallets (re-loadable but do not allow cash withdrawal as they are not linked to a bank, e.g. MobiKwik wallet) Semi-open wallets (linked to a bank, but do not allow cash withdrawal, e.g. m-pesa) Open wallets (re-loadable and linked with a bank, permit cash withdrawal at retailer outlets, agent outlets and ATMs,e.g., Paytm) Examples: Microsoft Passport, a server based digital wallet system ,

25. Bitcoins and Blockchains Bitcoin It is a cryptocurrency, created and held electronically on a PC or in a virtual wallet. Bitcoin transactions can be performed without the need for a credit card or central bank, enabling users to send money over the Internet in a very simple and efficient way. No individual runs Bitcoin rather it is run collectively by the users using the Bitcoin Client, and any changes to the Bitcoin system have to be approved by the majority of users before they are implemented Blockchain It is a distributed database that maintains a continuously growing list of records, called blocks, secured from tampering and revision. Each block contains a timestamp and a link to a previous block. By design, blockchains are inherently resistant to modification of the data — once recorded, the data in a block cannot be altered retroactively. The blockchain is a public ledger of all transactions in the Bitcoin network

26. eLogistics Material acquisition, warehousing, and transportation processes are the tasks related to logistics of any manufacturing unit. eLogistics makes use of web-based technologies to support these activities. eLogistics enables distribution to couple routing optimization with inventory-tracking information. GPRS based vehicle tracking system is one such application that is used in the field of eLogistics. Third-party logistics providers offer virtual logistics services by integrating and optimizing distribution resources. A company may even consider collaboration with its competitors to improve its supply chain. Partners in global chains and delivery nets use many present solutions of eLogistics to service business activity. Electronic services of logistic processes run by companies in the supply chain require the use of many electronic tools accessible through the Internet.

27. eAuction Theelectronic auction (e-Auction) is an e-business between auctioneers and bidders, which takes place on an electronic marketplace. It is an electronic commerce taking place business to business (B2B), business to consumer (B2C), or consumer-to-consumer (C2C). • The auctioneer offers his goods, commodities or services on an auction side on the internet. Interested parties can submit their bid for the product to be auctioned in certain specified periods. The auction is transparent; all interested parties are allowed to participate the auction in a timely manner. • The two major types of the electronic auction are forward auction in which several buyers bid for one seller’s goods and reverse auction in which several sellers bid for one buyer’s order. • Forward auctions or traditional auctions take the form of a single seller offering an item for sale, with buyers competing to secure the item by bidding the price upward. Forward auctions are far-better understood by the public at large than reverse auctions as to how they operate, due primarily to the fact that they are widely used at the consumer level

28. Forward and Reverse Auction Two major types of the electronic auction are forward auction in which several buyers bid for one seller’s goods and reverse auction in which several sellers bid for one buyer’s order. • Forward auctions or traditional auctions take the form of a single seller offering an item for sale, with buyers competing to secure the item by bidding the price upward. It is better understood by public

29. eProcurement It is the use of Web-based technology to support the key procurement processes. Procurement process implies the following activities namely, requisitioning, sourcing, contracting, ordering, and payment. eTender is a subset of eProcurement, or sometimes it is alternatively used in place of eProcurement. eProcurement supports the purchase of both direct and indirect materials and employs several Web-based functions, such as online catalogs, contracts, purchase orders, and shipping notices. eProcurement can improve the operation of the supply chain in various ways: Online catalogs can be used to eliminate redesign of components in product development. Visibility of available parts and their attributes enables quick decision making. Online purchase orders expedite the ordering process. Advanced-shipping notifications and acknowledgments streamline delivery.

30. eProcurement Advantages From the purchaser’s perspective, eProcurement can help better manage supplier relationships and accounts and allows for more effective tracking of orders. From the supplier’s perspective, eProcurement enables them to respond more rapidly and effectively to the requirements of purchasers. Both purchasers and suppliers report that eProcurement can assist them in better managing their business process and cash flows.

31. eGovernance The role of government in efficient delivery of services to the citizen has been of paramount importance and such services have been implemented and delivered through the application of information and communication technology (ICT). The four models of eGovernance can be summarized as: Business-to-government (B2G) Government-to-business (G2B) Government-to-citizen (G2C) Government-to-government (G2G) Government-to-employees (G2E)

32. Business-to-government (B2G) & Government-to-Business (G2B) B2G websites are accredited by the government and provide a medium to businesses to submit application forms to the government. Government uses G2B model website to approach business organizations. Such websites support auctions, tenders and application submission functionalities.

33. Government-to-Citizen (G2C) Government uses G2C model website to approach citizen in general. Supports auctions of vehicles, machinery or any other material. Provides services like registration for birth, marriage or death certificates, passport, municipal tax payment etc. Main objectives of G2C website are to reduce average time for fulfilling people requests for various government services.

34. Government-to-Government (G2G) G2G implies electronic sharing of data and/or information systems between government agencies, departments or organizations. The goal of G2G is to support e-government initiatives by improving communication, data access and data sharing. G2G model in India has been envisaged through the initiatives, namely, On-line submission of proposals on schemes like National Rural Employment Guarantee Act, Rural Housing, Swarnajayanti Gram SwarojgarYojana, by District level authorities, Fund release information, District-wise, State-wise, Zilla Parishad-wise status report for watershed programmes monitoring information system, State Wide Area Network (SWAN) for inter-state information exchange etc.

35. Government-to-Employees (G2E) Considering the large number of employees engaged in the government offices across the country, G2E model of eGovernance is aimed at improving the effectiveness and efficiency, reducing or eliminating inordinate delays in processing resulting in satisfaction and retention of government employees. This facilitates information sharing between the government and its employees regarding payroll and pension plans, obtaining training information, and accessing benefit eligibility information. G2E is also an effective way to provide e-learning to the employees, bring them together and to promote knowledge sharing among them. It also gives employees the possibility of accessing information in regard to compensation and benefit policies, training and learning opportunities and civil rights laws. G2E service also includes software for maintaining personnel information and records of employees.

36. National eGovernance Plan National eGovernance Plan (NeGP) was approved in 2006 with a focus on electronic delivery of services. This is in harmony with Government of India’s program of Digital India but the scope has been made wider and renaming it as NeGP 2.0 or eKranti. Many of the initiatives planned under Digital India have gone live (Sharma 2015).

37. National eGovernance Plan Some of the examples of the initiatives already implemented by the Department of Electronics and IT are as follows: MyGov Platform: MyGov.in, a platform for citizen engagement in governance, has been implemented as a medium to exchange ideas/suggestions with the government. Biometric Attendance System: Aadhaar-based biometric attendance system is being implemented in the central government offices . JeevanPramaan Portal: About 46,000 pensioners have submitted their life certificate on the portal. SMS Alerts for weather forecasting eBook Platform: This platform for eBooks, also called eBasta, has been developed. It is available at www.ebasta.in, wherein various eBooks are getting uploaded.

38. Questions What is the difference between B2B and B2C commerce? Discuss the advantages and disadvantages of electronic commerce. What do you mean by brokerage model of business? What is EDI? 3. Discuss the features of eCash. What is eTailing? 4. With examples of popular eCommerce companies and discuss their business models. 5. ‘The success of eMarketing depends on Click through Rate (CTR)’ – present your views on the statement. 6. What is a mobile wallet? Discuss the features of different types of mobile wallets.

39. Questions 7. What is the difference between eProcurement and eLogistics? 8. Why is eCollaboration important for company goal achievement? 9. Discuss the different variants of eGovernance? Consider any of the government portals and discuss the contents. 10. What is eAuction? What is the difference between forward and reverse auction? 11. How does technology supports government in empowering the citizen with respect delivery of the services? What is NeGP? Discuss the initiatives taken by the government to render services to the citizen.

40. e-commerce and e-Governance End of Chapter 14 Thank You