Kerala Plus One Business Studies Notes Chapter 5 Emerging Modes of Business
e-Business (Electronic Business):
e-business may be defined as the conduct of industry, trade and commerce
using the computer networks. Almost all types of business functions as well
as managerial activities like production, inventory management, product
development, accounting and finance, human resource management etc. can be
carried out over computer networks.
E-business is a wider term which includes e-commerce and other
electronically conducted business functions such as production, accounting,
finance, personnel etc.
ഇ-ബിസിനസ്ഇ-കൊമേഴ്സ്, ഉൽപാദനം, അക്ക ing ണ്ടിംഗ്, ഫിനാൻസ്, പേഴ്സണൽ തുടങ്ങിയ ഇലക്ട്രോണിക് രീതിയിൽ നടത്തുന്ന ബിസിനസ് പ്രവർത്തനങ്ങൾ ഉൾപ്പെടുന്ന വിശാലമായ പദമാണ് ഇ-ബിസിനസ്.
e-commerce covers a firms interactions with its customers and suppliers over the internet, e-business is, therefore, clearly much more than buying and selling over the internet, i.e., e-commerce.
Scope of e-business (e-Business models) /Various constituents of e-business:
It is that business activity in which two business units make electronic transaction.
Eg. making enquiries seeking or placing orders, communicating supply of goods, making payments, and so on.
2. B2C Commerce:
ബി 2 സി കൊമേഴ്സ്:
When the transaction is between business and consumers, it is called Business to Consumers. It enables a business firm to be in touch with its customers on round the clock basis. It involves consumers placing order on line, electronic payment etc.
3. Intra-B Commerce:
It means interaction and dealings among various departments and persons within the firm. For example, the marketing department may interact regularly with the production department and other departments that help in attaining efficient inventory handling, better cash management, timely and sufficient provision of customer services, and so on.
4. C2C Commerce:
സി 2 സി കൊമേഴ്സ്:
Under it, both the parties involved in electronic transaction are customers. It is required for buying and selling of those goods for which there are no established markets. For example, selling used books and household equipment.
Benefits of e-Business:
- e-business is relatively easy to start and requires lower capital.
- Customers can buy goods at any time from any seller located in different parts of the world.
- Business transactions can be made easily and speedily.
- Global reach – It provides a boundary less market.
- It helps to reduce clerical and paper work.
- It helps to eliminate middlemen.
- Any company can launch its new product in the market through the medium of E-Business.
- It improves the brand image of the company.
Movement towards a paperless society – Use of internet has considerably
reduced dependence on paperwork.
Limitations of e-Business:
- It lacks personal touch with customers, which makes it unsuitable for medical, legal services etc.
- The transaction can be finalised quickly, but physical delivery of goods often takes long time and be delayed.
- For successful implementation of e business, the parties to the transactions have to be familiar with computers.
- It leads to leakage of confidential information such as credit card details. Also there are problems of virus and hacking.
- It is difficult to establish identity of the parties .
Differences between Traditional business and e-business:
|Traditional business||e- business|
|Its formation is difficult||Its formation is easy|
|Investment is very high||Investment is low|
|Physical presence is required||Physical presence is not required|
|Location is important||Location is not important|
|Operating cost is high||Operating cost is low|
|Contact with suppliers and customers is through intermediaries||Direct contact with the suppliers and customers|
|Business process cycle is long||Business process cycle is shorter|
|Inter personal touch is high||Personal touch is less|
|Limited market coverage||Access to the global market|
|Communication is in hierarchical order||Communication is in non hierarchical order|
|Transaction risk is less||Transaction risk is high|
On line Transactions:On line transaction means receiving information about goods, placing an
order, receiving delivery and making payment through medium of internet.
ഓൺ ലൈൻ ഇടപാടുകൾ:
Buying / Selling Process:
Steps involved in online purchase:
ഒരു രജിസ്ട്രേഷൻ ഫോം പൂരിപ്പിച്ച് ഓൺലൈൻ വെണ്ടറിൽ രജിസ്റ്റർ ചെയ്യുക.
2. Place the order for the items put by customer in his virtual shopping
cart, an online record of what has been picked up while browsing the Online
ഉപഭോക്താവ് തന്റെ വെർച്വൽ ഷോപ്പിംഗ് കാർട്ടിൽ ഇട്ട ഓർഡർ നൽകുക, ഓൺലൈൻ സ്റ്റോർ ബ്രൗസുചെയ്യുമ്പോൾ എടുത്തതിന്റെ ഓൺലൈൻ റെക്കോർഡ്.
3. Payment for the purchases through online shopping may be done in a number
of ways: i.e Cash on delivery, cheque, net banking transfer, debit/credit
ഓൺലൈൻ ഷോപ്പിംഗ് വഴിയുള്ള വാങ്ങലുകൾ പല തരത്തിൽ ചെയ്യാം: അതായത് ക്യാഷ് ഓൺ ഡെലിവറി, ചെക്ക്, നെറ്റ് ബാങ്കിംഗ് ട്രാൻസ്ഫർ, ഡെബിറ്റ് / ക്രെഡിറ്റ് കാർഡ്
Net Banking Transfer:
Modem banks provide to their customers the facility of electronic transfer of funds over the net. In this case, the buyer may transfer the transaction amount to the account of the online vendor who may, then, proceed to arrange for the delivery of goods.
The holder of a debit card can buy goods from approved shops without paying cash against the balance in his bank account. Every purchase reduces bank balance. Debit card is issued to bank account holders only and against the amount deposited with the bank.
A credit card is an instrument issued by a bank in the name of the customer providing credit up to a specified amount. The person holding a valid credit card uses it for purchasing goods from approved shops without paying cash. The payment is made by the bank to the sellers. The buyers have to pay for the purchase within the credit period.
Security and safety of e- Business:
There are three types of possible risks as listed below:
ഇ-ബിസിനസ്സിന്റെ സുരക്ഷയും സുരക്ഷയും:
ചുവടെ ലിസ്റ്റുചെയ്തിരിക്കുന്നതുപോലെ മൂന്ന് തരത്തിലുള്ള അപകടസാധ്യതകൾ ഉണ്ട്:
(a) Transaction risks:
Seller may deny that customer ever placed the order or the customer may
deny that he ever placed the order. It is called “Default on Order
Goods may be delivered at wrong address or wrong goods may be delivered
which is referred as “Default on Delivery”.
സാധനങ്ങൾ തെറ്റായ വിലാസത്തിൽ കൈമാറാം അല്ലെങ്കിൽ തെറ്റായ സാധനങ്ങൾ ഡെലിവറി ഓൺ ഡെലിവറി എന്ന് വിളിക്കാം.
Seller may complaint that he didn’t receive payment while customer may
claim that payment was over. This is referred as “Default Payment”.
(b) Data storage and transmission risks:
ഡാറ്റ സംഭരണവും പ്രക്ഷേപണ അപകടസാധ്യതകളും
VIRUS (Vital Information & Resources Under Siege): Virus can disrupt
functioning, damage the data and even may cause complete destruction of
വൈറസ് (ഉപരോധത്തിൻ കീഴിലുള്ള സുപ്രധാന വിവരങ്ങളും ഉറവിടങ്ങളും): വൈറസ് പ്രവർത്തനത്തെ തടസ്സപ്പെടുത്തുകയും ഡാറ്റയെ തകരാറിലാക്കുകയും സിസ്റ്റത്തിന്റെ പൂർണ്ണമായ നാശത്തിന് കാരണമാവുകയും ചെയ്യും.
- Interception: Data maybe intercepted in the course of transmission
തടസ്സപ്പെടുത്തൽ: പ്രക്ഷേപണ വേളയിൽ ഡാറ്റ തടസ്സപ്പെട്ടേക്കാം
(c) Risks of threat to intellectual property and privacy:
ഭൗദ്ധിക സ്വത്തവകാശത്തിനും സ്വകാര്യതയ്ക്കും ഭീഷണിയാകാനുള്ള സാധ്യത
Once the information is made available over the internet, it moves out of
the private domain. So important information may be copied by others.
When data furnished goes in the hands of others they may start dumping
with lot of advertising & promotional literature into our e-mail box
നൽകിയ ഡാറ്റ മറ്റുള്ളവരുടെ കൈകളിലേക്ക് പോകുമ്പോൾ, അവർ ധാരാളം പരസ്യങ്ങളും പ്രമോഷണൽ സാഹിത്യങ്ങളും ഉപയോഗിച്ച് ഞങ്ങളുടെ ഇ-മെയിൽ ബോക്സിലേക്ക് വലിച്ചെറിയാൻ തുടങ്ങും.
Resources Required for Successful e-Business Implementation:
The resources required for the e-Business are:
വിജയകരമായ ഇ-ബിസിനസ് നടപ്പാക്കലിനായി ആവശ്യമായ വിഭവങ്ങൾ:
- Computer system
- Internet connection and technically qualified work force
- A well developed web page
- Effective telecommunication system
- A good system for making payment using credit instruments.
Outsourcing or Business Process Outsourcing (BPO):
Outsourcing is a management strategy by which an organisation contracts out its major non-core functions to specialized service providers with a view to benefit from their expertise, efficiency and cost effectiveness, and allow managers to concentrate on their core activities.
Merits of outsourcing:
- Focusing attention : It provides an opportunity to the organisation to concentrate on areas in which it has core competency or strength.
- Higher efficiency : It helps better utilisation of its resources as the management can focus its attention on selected activities and attain higher efficiency.
- Cost reduction : It helps the organisation to get an expert and specialised service at competitive prices. It helps in improved service and reduction in costs.
- It facilitates inter-organisational knowledge sharing and collaborative learning.
- Growth through alliance : It enables expansion of business as resources saved from outsourcing can be used for expanding the production capacity and diversified products.
Limitations of outsourcing
- It reduces confidentiality as outsourcing involves sharing a lot of information with others.
- It may be opposed by labour unions who feel threatened by possible reduction in their employment.
- In the name of cost cutting, unlawful activities such as child labour, wage discrimination maybe encouraged in other countries.
- The organisation hiring others may face the problem of loss of managerial control because it is more difficult to manage outside service providers than managing one’s own employees.
- It causes unemployment in the home country.