What is E-Business? e-business vs e-commerce, Advantages of E-business.
It refers to all those commercial activities performed over the internet by using web based technologies. It creates value and strengthens relationship with customers, suppliers, business partners, shareholders and employees by connecting them via internet, intranet and extranets. E-business is a broader term that not only includes. e-commerce but also other aspects like e-franchising, e-mailing, e-marketing etc.
E-business affects the whole business and the value chains in which it operates. E-business may be defined as the conduct of industry, trade and commerce using the computer networks. It enables a much more integrated level of collaboration between the different components of a value chain than ever before. It uses e-information to boost performance and create value by forming new relationships between and among businesses and customers. Adopting E-Business also allows companies to reduce costs and improve customer response time.
The three primary processes that are enhanced in e-business are:
- Production processes (includes procurement, ordering of stocks and its replenishment, electronic payment processing, links with suppliers and vendors)
- Customer-focused processes (includes promotional and marketing efforts, sales over the Internet, purchase order processing and payments, and customer support after sales and customer feedback.
- Internal management processes (includes recruiting, employee services, training, internal information-sharing).
E-business enables organizations to accomplish the goals such as reach new markets, create new products or services, enrich human capital, build customer loyalty, best use of existing and emerging technologies, and achieve market leadership and competitive advantage. According to Lou Gerstner, IBM’s CEO: “E-business is all about cycle time, speed, globalization, enhanced productivity, reaching new customers and sharing knowledge across institutions for competitive advantage.”
E-BUSINESS VERSUS E-COMMERCE
E-Commerce covers a firm’s interactions with its customers and suppliers over the internet, E-Business includes not only e-commerce, but also other electronically conducted business functions such as production, inventory management, product development, accounting and finance and human resource management. E-business is, therefore, clearly much more than buying and selling over the internet i.e. E-Commerce.
ADVANTAGES OF E-BUSINESS
- Lower cost- E-business is relatively easy to start. In fact, internet is responsible for the popularity of the phrase: ‘networked individuals and firms are more efficient than net worth individuals. This means that even if you do not have much of the investment (net worth) but have contacts (network), you can do fabulous business.
- Convenience: The maximum benefit that one can derive from internet is its availability 24 hours x 7 days a week x 365 days. Customers can go for shopping at any time. Organizational personnel too have such a flexibility whereby they can do their work from wherever they are, and whenever they may want to do it.
- Speed: Internet has made it possible to purchase any software online by downloading it at a very fast speed. Products such as software, music, e-books etc are easily available. Fulfilment or delivery of the intangible products is very fast with the help of secured e-payment solutions. INTRODUCTION TO E-COMMERCE 27
- Global reach/access: Internet is without boundaries. It has a global reach such that both buyers and sellers have a freedom to buy and sell the product anywhere. It has a wider scope.
- Disintermediation- There is an elimination of middlemen, thus a direct contact between the manufacturer and customer is made possible.