Q1: What are the various requirements for the successful implementation of E-commerce?
Ans: Requirements for successful implementation of E-commerce: Resources Required for E-commerce: E-commerce has tremendous potential in the Indian economy. But it requires the following resources for its successful implementation:
Q2: Write a note on the security of business transactions through E-commerce.
Ans: Security of business transactions in E-commerce: E-commerce can succeed when both buyers and sellers trust the system of exchange. This trust can be generated by ensuring the security of e-commerce transactions.
There are five essential elements for ensuring secure transactions over the Internet.
These mechanisms depend upon certification by a trusted third party (such as a government body). Therefore, global electronic commerce requires the establishment of a global certification system.
In order to ensure the security and safety of e-transactions, the following points need to be observed and followed:
Secure transactions require that all parties use up-to-date software and hardware. Since consumers are the weakest link, organizations offering e-commerce must take special care to alert them about possible security problems. For example, www.buyandhold.com issued a security alert because some older versions of Netscape Communicator and Microsoft Internet Explorer included a root CA certificate which was set to expire at the end of 1999. The alert encouraged visitors to upgrade their browsers.
It is necessary to make customers feel comfortable about ordering online.
Q3: What are the various opportunities or benefits of E-commerce in the modern business world?
Ans: Opportunities and benefits of E-commerce: E-commerce makes it possible to work round the clock and around the world. It enables companies to be more efficient and flexible in their internal operations, to work more closely with their suppliers, and to be more responsive to the needs and expectations of their customers.
It allows companies to select the best suppliers regardless of their geographical location and to sell to a global market. It also offers business concerns more cost-efficient and time-efficient means of working with customers, suppliers, and development partners.
E-commerce offers several opportunities to suppliers and commensurate benefits to customers. These are given below:
Q4: What is the outsourcing of services? Mention in detail the various services which may be outsourced by a business unit.
Ans: Concept of outsourcing of services: The term ‘outsource’ means getting something from external sources rather than creating it within the organization. For instance, a firm may outsource the ‘advertising activity’ to an advertising agency instead of setting up its own advertising department. Similarly, other services may also be outsourced for better quality service and also to achieve economy.
This practice is called Business Process Outsourcing (BPO). The basic feature of BPO is that’ companies hire out.on contracting those services or tasks which are performed on regular basis’. For example, a business enterprise may outsource the employment of personnel, training of personnel, and payroll accounting to a specialized service provider
Traditionally, industrial organizations have faced the problem of ‘Make or Buy’ certain components or parts. They can compare the costs of both in-house production and outsourcing the components while taking such decisions.
Types of Services: There are several types of services that are offered by business firms to their customers or clients.
The significant services include the following:
(a) Financial services such as underwriting, issue management.
(b) Advertising service.
(c) Customer support services.
(d) Courier service.
(e) Communication services such as STD, ISD, local phone, etc.
(f) Hotel services.
(g) Airlines services.
(h) Banking services.
(l) Health services.
Outsourcing of Financial Services: Big companies require to obtain several financial services from outside or external sources (i.e, outsourcing) because they don’t possess the infrastructure and capability to perform such services.
These include the following:
Advertising Services: Business firms depend upon advertising agencies for designing, developing, and disseminating advertisements for their products and services. All big firms need to advertise their goods and services which require specialized handling. They can outsource this assignment to advertising (ad) agencies. Ad agencies help their clients in preparing the advertisement budget, advertisement program, and advertisement copy.
They prepare ad films, documentaries, and other promotional material on behalf of their clients. They also help the clients in choosing the ad media such as TV, radio, newspaper, hoarding, etc.
By entrusting the advertisement assignment to an ad-agency, the business firm is saved of the botheration and cost of employing a copywriter, film-maker, cameraman, and others. This turns out to be economical for the firm in the long-run. Outsourcing also helps to make use of the services of experts of the ad-agency.
Courier Service: Courier service involved delivery of letters, documents, and small parcels from one place to another through private operators known as couriers or courier companies.
The reasons for the popularity of courier services are as under:
Types of Courier Services: Courier forms such as DTH, Overnite Express, and others collect all articles and dispatches to their destinations.
Messenger Service: Under this, letters and documents could be delivered at the local and regional levels generally within a period of 24 hours.
Inter-State Service: This courier service is intended to deliver letters and documents from one state to another within a period of 24 to 48 hours.
Overseas Desk-to-Desk Courier Service: This service offers desk-to-desk document deliveries using air-courier services. Several international couriers with their own fleet of aircraft are operating in this field such as DHL Couriers, Transworld Couriers, Blazeflash Couriers, Express Air, United Parcel Service (UPS), etc.
Customer Support Services: ‘Customer is like a precious ornament which should not be stolen by anyone else.’ The above saying clearly states the importance of customer satisfaction and delight. It is the dissatisfied customer who does not repeat orders with the same seller. He may be dissatisfied because of some problem with the product or because of lack of care in attending to his complaints or inadequate after-sale service.
The term ‘after-sales service’ means responding to a customer with a problem. The problem may relate to ‘product complaints’ during the warranty period and even after that, spare parts, etc. This requires an organized system of efficient customer support services. Customers need home delivery service, repair, and maintenance of consumer durables, information and counseling about brands, and best meet of their needs.
In the present-day competitive environment, every business must take care of the grievances/complaints of the customers and do the needful to please the customers.
There are two options as regards provision of customer support services, namely, creation of customer support services department within the organization, or entering into an arrangement with an outside agency to provide after-sales services on behalf of the organization.
Traditionally, business organizations have organized their own customer support services departments. Such a department is manned by trained personnel to attend to the complaints of their customers.
The quality of after-sales services by this department determines the image of the organization. Every organization can’t afford to have a separate customer support service department because of a shortage of funds and inadequate infrastructure.
In such a case, it is advisable to outsource various customer support services from a reputed agency. Such an agency would take operational responsibility for providing customer support services on behalf of the organization against a stipulated amount of payment every year. If the agency or service provider fails to provide efficient and satisfactory services, the organization can cancel the contract with it and engage some other agency.
Generally, the customers of products like consumer durables (Fridge, TV, Air Conditioner, etc.) are widely spread throughout th€ country. They might need repair services during the ‘warranty period’ or even after that. If such services are not easily available, the image of the manufacturer and his brand will go down in the market. In the past, some TV manufacturers in India failed because they could not provide satisfactory after-sales services to their customers.
In such a situation, it is better to outsource such services to some reputed service provider or agency. The manufacturer will be saved from the botheration of engaging staff and creating the infrastructure for providing after-sales services to the customers.
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