Impact of E-Business, E-Commerce Video Lecture | E-Commerce - B Com

welcome to Mustang next in business
lecture series from this episode we take
a detailed look at the impact of
businesses on different industries and
global business activities in the
emerging global economy the e-business
is increasingly becoming a necessary
component of business activities and
also is a strong catalyst for economic
development the integration of
e-business cells in businesses
revolutionized the relationship between
the organizations and also between the
organizations and individuals now the
use of businesses in businesses enhance
the productivity encourage create a
customer participation and enable the
mass customization besides reducing cost
as IT professional you should be able to
conceptualize how a businesses can use
to derive competitive advantage for your
organization as well as develop yourself
as a business consultant with its effect
of leveling the playing field in
businesses that have coupled with
appropriate strategy and policy
approaches enables small and medium
scale enterprises SMEs to complete with
large and capital rich businesses on the
other hand developing countries given
increased access to the global
marketplace so they can compete with
them go together with more developed
economies most of developing countries
are already participating in businesses
as either sellers or buyers ok now in
e-business the sphere icon eyes there
are three primary processes production
processes customer focus processors and
internal management processes in the
production processes it is basically
include procurement ordering and refill
amount of the stocks processing of
payments electronically linked with the
suppliers and production control
processors etc in the customer focused
processors it includes promotional and
marketing efforts selling over the
Internet processing of customers
purchase orders and payments and
customer support in the internal
management processes it includes
employee services training internal
information sharing video conferencing
protruding excess
now for all of these three primary
processors we use electronic
applications now these electronic
applications and has the information
flow and the workgroup communication
between the production and sales to
improve the Salesforce producted as now
we are at the information age it is
recognized at the information age
Internet is a powerful tool in the
economic growth of developing countries
it seems like a businesses assures to
provide better businesses for small and
medium-sized firms and sustainable
economic development for developing
countries however this is premised on
strong political will and good
governance as well as on a responsible
and supportive private sector within an
effective policy framework so that talk
was about the impact of the economy as a
nation now we are talking about the
impact of the transaction cost there are
three cost areas that are significantly
reduced through the conduct of b2b
businesses first is the reduction of
search cost as buyers they do not need
to go through multiple intermediaries to
search for information in terms of
effort time and management the internet
is more efficient information channel
than its traditional counterpart in b2b
market players buyers and sellers gather
together into a single online trading
community reducing search cost further
the second one is the reduction in the
cost of processing transactions as b2b
allows for the automation of transaction
process the third one is the cost in
inventory and logistic transactions
because with the online order processing
we can reduce the delays that is
happening in the inventory and logistic
transaction management and also the cost
of managing physical stalls here is
another impact that is happening with
the businesses this intermediation
through the b2b marketplaces suppliers
are able to interact and transact
directly with the buyers and they are
bite eliminate intermediaries and
distributors in simple word
disintermediation means cutting down the
middleman now this disintermediation
should be handled very smoothly if not a
channel conflict may arise as we
discussed
the benefits initials episode another
area that is impacted with the
e-business versus the pricing among the
more evident benefits of remarket places
is the increase in price transparency as
the gathering of large number of buyers
and sellers in a single EEMA card
players it reveals market price
information and transaction processing
to all the participants that is because
we use the mode internet the Internet
allows for the publication of
information on a single purchase or
transaction
making information readily accessible
and available to all the members in the
email good place now this increased
price transparency has the effect of
pulling down the price differentials in
the market in this context buyers are
provided much more time to compare
prices and make the better buying
decisions more on that these amarka
places are first negotiated pricing we
are the multiple buyers and sellers can
collectively participate in price
setting options in such environments
prices can be set through automatic
matching of bids and offers and also in
this kind of a market players the
requirements of both buyers and sellers
are aggregated to reach competitive
prices which are lower than those
resulting from individual actions here
is another area impacted economies of
scale economies of scale is the cost
advantage that arises with increased
output of a product it arises because of
the inverse relationship between the
quantity produced and per unit fixed
cost for instance the greater the
quantity of a good produce the lower the
per unit fixed cost becomes we say we
achieved economies of scales and that is
because these costs are spread out over
a large number of goods produced now in
this diagram the x-axis represent the
output and y-axis represent the average
cost the area where the average cost is
becoming lower when the output is
increased we call that area economies of
scale I'll explain this using a simple
example assume that you are a small
business owner and considering printing
marketing brochures the printer
a prize of $5,000 and $10,000 for 2,500
copies while 500 brochures will cost you
10 rupees per brochure and 2,500 will
only cost you 4 apiece per brochure in
this case the printer is passing on part
of the cost advantage of printing a
large number of brochures to you this
cost advantage arise because the printer
has the same initial setup cost
regardless of whether the number of
brochures printed is 500 or 2500 once
these costs are covered there is only a
marginal extra cost for printing each
additional brochure but this economies
of scale can be achieved up to a certain
point after reaching the certain point
it becomes increasingly expensive to
manage and this undesirable phenomenon
is referred to as this economies of
scale with a business's it bringing
together a significant number of buyers
and sellers and this provides something
called Network effect each additional
incremental participant in the
marketplace creates a value for all
participants in the demand side more
participants from a critical mass which
is a key in attracting more users to the
market now this network effect it is a
phenomenon whereby a good or service
becomes more valuable when more people
use it the Internet is a good example
initially there are few uses of the
Internet in the beginning and it was
relatively little value to anyone
outside of the military and a few
research scientists as more users gained
access to the Internet however there
were more and more websites to visit and
more people to communicate with and then
the internet become extremely valuable
to its users now look at this
illustration if there are two users
there is only one connection if there
are 4 users that means there are 6
connections if there are 8 users that
means there are 28 connections so
likewise when the participants are
getting increased the connection become
more increased the
see fertile for any good or service
which uses the network effect is to get
enough initial users so that the network
effect take hold the amount of users
required for significant network effect
is often referred to as critical mass
after the critical mass is attained the
good or service should be able to obtain
many new users since its network offers
utility but if too many people use the
good or service a negative Network
effect can occur in the internet analogy
having too many users on the Internet
can hypothetically cause the speed to
deteriorate decreasing utility for users
thus providers of goods and service
which use a network effect must ensure
that the capacity can be increased
sufficiently to accommodate all the
users here is the last impacted area in
our agenda impact on government
governments can use the e businesses in
several ways to enhance the efficiency
of its activities for example web based
purchasing policies will increase the
transparency of the procurement process
and also it will reduce the risk of
irritability however up to this date the
size of BGE marketplaces as a component
of total business is insignificant
because the government procurement
systems still remain undeveloped however
we have identified three areas that can
be impacted with b2g concept the first
one is e procurement the second one is
customs clearance and the third one is
tax administration with the
e-procurement government agencies would
be able to trade electronically with all
the suppliers and in customs clearance
with the computerization of customs
processes and operations one can expect
more predictable and more precise
information on clearing time and deliver
Shipton and increased legitimate
revenues now in the tax administration
it includes a system for electronic
processing and transmission of tax
return information online assurances of
tax clearances
permits and license and an electronic
process registration of
missiles and new taxpayers and etc
however the e-business initiators of the
government are a measurement indicating
whether or not the e-business
infrastructure is available this means
that if government is unable to engage
in a procurement secure records online
or have custom fees remitted
electronically then the private sector
will also have difficulties in a
business update and that's all what we
got here in this episode from this
episode we talked about several areas
that we business can impact on see you
again in another episode stereo off a
small finger