CHAPTER 6: Electronic Commerce: Applications and Issues

Overview of E-Business & E-Commerce:

o Electronic commerce (e-commerce, EC) describes the buying, selling, transferring or exchanging of products, services or information via computer networks, including the Internet.

o E-business is a broader definition of EC, including buying and selling of goods and services, and also servicing customers, collaborating with partners, conducting e-learning and conducting electronic transactions within an organization.

o Types of E-Commerce:

1. Business-to-Consumer (B2C)

2. Business-to-Business (B2B)

3. Consumer-to-Consumer (C2C)

4. Business-to-Employee (B2E)

5. E-Government

6. Mobile Commerce (m-commerce)

o Benefits of E-Commerce:

§ Benefits to organizations

          o Makes national and international markets more accessible.

          o Lowering costs of processing, distributing, and retrieving information.

§ Benefits to customers

o Access a vast number of products and services around the clock (24/7/365).

§ Benefits to Society

o Ability to easily and conveniently deliver information, services and products to people in cities, rural areas and developing countries.

o Limitations of E-Commerce:

§ Technological Limitations

          o Lack of universally accepted security standards

          o Insufficient telecommunications bandwidth

          o Expensive accessibility

§ Non-technological Limitations

          o Perception that EC is unsecure

          o Unresolved legal issues

          o Lacks a critical mass of sellers and buyers

· Business-to-Consumer (B2C) Electronic Commerce:

o An electronic storefront is a Web site that represents a single store.

o Electronic malls are collections of individual shops under a single Internet address.

o B2C electronic commerce is also known as e-tailing.

o Issues in E-Tailing:

§ Channel conflict occurs when manufacturers disinter mediate their channel partners, such as distributors, retailers, dealers, and sales representatives, by selling their products directly to consumers, usually over the Internet through electronic commerce.

§ Order fulfillment involves finding the product to be shipped; packaging the product; arrange for speedy delivery to the customer; and handle the return of unwanted or defective products.

· Business-to-Business (B2B) Electronic Commerce:

o In B2B e-commerce, the buyers and sellers are organizations.

o B2B Sell-Side Marketplace:

 § In the sell-side marketplace, organizations sell their products or services to other organizations electronically from their own Web site and/or from a third-party Web site.

　

　

o B2B Buy-Side Marketplace:

§ The buy-side marketplace is a model in which organizations buy needed products and services from other organizations electronically.

　

　

o Electronic Exchanges:

§ Exchanges have many buyers and many sellers.



　

　

· Electronic Payments:

o Electronic payment systems enable you to pay for goods and services electronically.

§ Electronic checks (e-checks)

§ Electronic credit cards

§ Purchasing cards

§ Electronic cash

          1. Stored-value money cards

          2. Smart cards

          3. Person-to-person payments

Chapter 3: Information Systems: Ethics, Privacy and Information Security

I have learned many concepts and information from this chapter. I summarized them as follow:

· Ethical Issues:

Ethics. A branch of philosophy that deals with what is considered to be right and wrong.

A Code of Ethics is a collection of principles that are intended to guide decision making by members of an organization.

· Fundamental Tenets of Ethics:

         o Responsibility means that you accept the consequences of your decisions and actions.

         o Accountability means a determination of who is responsible for actions that were taken.

         o Liability is a legal concept meaning that individuals have the right to recover the damages done to them by other individuals, organizations, or systems.

· The Four Categories of Ethical Issues:

         o Privacy Issues involve collecting, storing and disseminating information about individuals.

         o Accuracy Issues involve the authenticity, fidelity and accuracy of information that is collected and processed.

         o Property Issues involve the ownership and value of information.

         o Accessibility Issues revolve around who should have access to information and whether they should have to pay for this access.

· Privacy

Privacy is the right to be left alone and to be free of unreasonable personal intrusions.

· Threats to Privacy:

         o Data aggregators, digital dossiers, and profiling

         o Electronic Surveillance

         o Personal Information in Databases

         o Information on Internet Bulletin Boards, Newsgroups, and Social Networking Sites

· Protecting Privacy:

         o Opt-out model of informed consent permits the company to collect personal information until the customer specifically requests that the data not be collected.

         o Opt-in model of informed consent means that organizations are prohibited from collecting any personal information unless the customer specifically authorizes it.

· Threats to Information Security:

Key Information Security Terms:

         o A threat to an information resource is any danger to which a system may be exposed.

         o The exposure of an information resources is the harm, loss or damage that can result if a threat compromises that resource.

         o A system’s vulnerability is the possibility that the system will suffer harm by a threat.

         o Risk is the likelihood that a threat will occur.

         o Information system controls are the procedures, devices, or software aimed at preventing a compromise to the system.

o Categories of Threats to Information Systems:

         1. Unintentional acts

         2. Natural disasters

         3. Technical failures

         4. Management failures

         5. Deliberate acts

· Protecting Information Resources:

o Risk Management:

         1. Risk: The probability that a threat will impact an information resource.

         2. Risk management: To identify, control and minimize the impact of threats.

         3. Risk analysis: To assess the value of each asset being protected, estimate the probability it might be compromised, and compare the probable costs of it being compromised with the cost of protecting it.

o Risk mitigation is when the organization takes concrete actions against risk. It has two functions:

         1. Implement controls to prevent identified threats from occurring.

         2. Developing a means of recovery should the threat become a reality.

· Information Systems Auditing:

o Types of Auditors and Audits:

         1. Internal. Performed by corporate internal auditors.

         2. External. Reviews internal audit as well as the inputs, processing and outputs of information systems.

o IS Auditing Procedure:

         1. Auditing around the computer means verifying processing by checking for known outputs or specific inputs.

         2. Auditing through the computer means inputs, outputs and processing are checked.

         3. Auditing with the computer means using a combination of client data, auditor software, and client and auditor hardware.

Chapter 5: Network Applications, Web 2.0, Distance Learning, and Telecommuting

I have learned many concepts and information from this chapter. I summarized them as follow:

§ Network Applications:

Discovery allows users to browse and search data sources, in all topic areas, on the Web.

Search engines are computer programs that search for specific information by key words and report the results.

Metasearch engines search several engines at once and integrate the findings of the various search engines to answer queries posted by users.

Portal is a Web-based, personalized gateway to information and knowledge that provides

Relevant information from different IT systems and the Internet using advanced search and indexing techniques.

     1. Commercial (public) portals offer content for diverse communities and are the most popular portals on the Internet.

     2. Affinity portals support communities such as a hobby group or a political party.

     3. Mobile portals are accessible from mobile devices.

     4. Corporate portals offer a personalized single point of access through a Web browser.

     5. Industry wide portals are for entire industries.

§ Web 2.0 is a loose collection of information technologies and applications, and the Web sites that use them.

Market Value of various Web 2.0 Companies

　

§ Web 2.0 Information Technologies and Applications:

        AJAX: A web development technique that allows portions of web pages to reload with fresh data instead of requiring the entire web page to reload

        Tagging: A tag is a keyword or term that describes a piece of information (e.g., blog, picture, article, video clip)

        Blogs and blogging: A blog is a personal web site, open to the public, in which the site creator expresses his or her feelings or opinions.

§ E-Learning and Distance Learning:

        1. E-Learning refers to learning supported by the Web.

        2. Distance learning (DL) refers to any learning situation in which teachers and students do not meet face-to-face.

§Benefits of E-Learning:

        · Self-paced learning increases content retention.

        · Online materials deliver high-quality, current content.

        · Students have the flexibility of learning from any place at any time at their own pace.

        · Learning time generally is shorter, and more people can be trained due to faster training time.

        · Training costs can be reduced.

§Drawbacks of E-Learning:

        · Instructors may need training to be able to teach electronically.

        · The purchase of additional multimedia equipment may be necessary.

        · Students must be computer literate and may miss the face-to-face interaction with instructors.

        · There are issues with assessing students’ work, as instructors really do not know who completed assignments.

Chapter 4: Managing Knowledge and Data

I have learned many concepts and information from this chapter. I summarized them as follow: 

Difficulties in Managing Data are:

1. Amount of data increases exponentially.
2. Data are dispersed and collected by many individuals using various methods and devices.
3. Data come from many sources.
4. Data security, quality and integrity are critical.

Database management system (DBMS) provides all users with access to all the data.

It minimize: Data redundancy, isolation and inconsistency. And maximize: Data security, integrity and independence.

The data model is a diagram that represents the entities in the database and their relationships.

Database designers plan the database design in a process called entity-relationship (ER) modeling.

A database management system is a set of programs that provide users with tools to add, delete, access, and analyze data stored in one location.

Normalization is a method for analyzing and reducing a relational database to its most streamlined form for:Minimum redundancy, Maximum data integrity and Best processing performance.

A data warehouse is a repository of historical data organized by subject to supportdecision makers in the organization.

The data cube has three dimensions: customer, product, and time.

Online analytical processing (OLAP) involves the analysis of accumulated data by end users

(usually in a data warehouse).

Benefits of Data Warehousing are:

1. End users can access data quickly and easily via Web browsers because they are located in one place.
2. End users can conduct extensive analysis with data in ways that may not have been possible before.
3. End users have a united view of organizational data.

A data mart is a small data warehouse, designed for the end-user needs in a strategic business unit (SBU) or a department.

Master data management is a method that organizations use in data governance.

Knowledge management is a process that helps organizations manipulates important knowledge that is part of the organization’s memory, usually in an unstructured format.

Knowledge that is contextual, relevant, and actionable.

Intellectual capital is another term often used for knowledge.

Knowledge management systems refer to the use of information technologies to systematize,enhance, and expedite intra-firm and inter-firm knowledge management.

Chapter 2: Information Systems and the Modern Organization

I have learned many concepts and information from this chapter. These are types of information systems, competitive advantage and strategic information systems, importance of information systems and managing information resources. I summarized them as follows:

· Computer-based information systems (CBIS) use computer technology to perform some or all of their tasks and are composed of:

     o Hardware is a device such as a processor, monitor, keyboard or printer.

     o Software is a program or collection of programs that enable hardware to process data.

     o Database is a collection of related files or tables containing data.

     o Network is a connecting system (wireline or wireless) that permits different computers to share resources.

     o Procedures are the set of instructions about how to combine the above components in order to process information and generate the desired output.

     o People are those individuals who use the hardware and software, interface with it, or use its output.

· Capabilities of Information Systems:

     o Perform high-speed, high-volume numerical computations

     o Provide fast, accurate communication and collaboration within and among organizations.

     o Store huge amounts of information in small space.

     o Allow quick, inexpensive access to vast amounts of information worldwide.

     o Interpret vast amounts of data quickly and efficiently.

     o Increase effectiveness and efficiency of people working in groups in one place or around the world.

     o Automate semiautomatic business process and manual tasks.

· Breadth of Support of Information Systems:

     o Functional area information systems

     o Enterprise resource planning systems

     o Transaction processing systems

     o Interorganizational information systems

· Information Systems Support for Organization Employees:

     o Office automation systems

     o Functional area information systems

     o Business intelligence systems

     o Expert Systems

     o Dashboards

· Competitive Advantage: An advantage over competitors in some measure such as cost, quality, or speed, leads to control of a market and to larger-than average profits.

· Strategic Information Systems (SIS) provide a competitive advantage by helping an organization to implement its strategic goals and to increase its performance and productivity.

· The importance Information Systems to Organizations & Society:

     o IT will reduce the number of middle managers.

     o IT will change the manager’s job.

     o IT impacts employees at work.

     o IT provides quality-of-life improvements.

· Managing Information Resources

     o During the early 1950s, Information Systems Department (ISD) managed ALL of the only computing resource, the mainframe. Today, computing resources are located through the organization and almost all employees use computers in their work. This system is known as end user computing.

· The Role of the IS Department

     o The ISD is responsible for corporate-level and shared resources and for using IT to solve end users’ business problems. Also, End users are responsible for their own computing resources and departmental resources. Finally ISD and end users work together as partners to manage the IT resources.

Chapter 1: The Modern Organization Functioning in a Global Environment

I have learned many concepts and information from this chapter about business processes and business process management, business pressures. I summarized them as follows:

A business process is a collection of related activities that produce a product or a service of value to the organization, its business partners, and/or its customers.
 
Business process management is a management technique that includes methods and tools to support the design, analysis, implementation, management, and optimization of business processes.
 
Data Item: Elementary description of things, events, activities and transactions that are recorded, classified and stored but are not organized to convey any specific meaning.
 
Information: Data organized so that they have meaning and value to the recipient.
 
Knowledge: Data and/or information organized and processed to convey understanding, experience, accumulated learning and expertise as they apply to a current problem or activity.
 
Information Technology Architecture: A high-level map or plan of the information assets in an organization, which guides current operations and is a blueprint for future directions.

Information Technology Infrastructure: The physical facilities, IT components, IT services and management that support an entire organization.

IT components consist of hardware, software, telecommunications and networks, and wireless communications.
 
IT services consist of data management, managing security and risk, and systems development.
 
IT infrastructure consists of IT components, IT personnel, and IT services.


We are in a convergence of three powerful, technological forces: 
      (1) Cheap and ubiquitous computing devices
      (2) Low-cost, high bandwidth
      (3) Open standards

The business environment is the combination of social, legal, economic, physical, and political factors that affect business activities.

The three types of business pressures faced are: market, technology, and societal pressures.

The importance of Information Systems:
(1) Information systems and information technologies are integral to our lives
(2) Information systems offer career opportunities.
(3) Information systems are used by all functional areas in an organization.

Misinformation about Information Systems Career Opportunities:
 
Myth #1: There are no computing jobs.
Myth #2: There will be no IT jobs when I graduate.
Myth #3: All IT-related jobs are moving offshore.
Myth #4: IT salaries are lower due to cheap overseas labor.