Kerala Plus One Business Studies Notes Chapter 5
Emerging Modes of Business
FOCUS AREA ONLY
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.
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|
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.