This research paper focus on a unified framework that captures the antecedents of e-business adoption, provide a clear picture of the benefits and challenges that e-business companies face and identify the fundamental design principles for building a successful e-business blueprint .The merge of the information technology and the web standards have formed the electronic business “E-business”. E-business has dynamic, rapidly growing and highly competitive characteristic. E-business is transforming the rules of competition for established businesses in many ways. This paper attempts to see the theoretical perspectives of e-business. This research investigates the characteristics of e-business. Then we discuss theories that highlight the sources of value in general. Succession in e-business will need organizations to revise their strategies and goals to meet market rules of demand and supply. Conversion of ordinary business into e-business has forced organizations to be redesigned and reshaped. E-business is a combination of economic, technology and market forces that reinvented strategies of traditional business. E-business and Internet have enforced organizations to use new and combined models. This enforcement drove organizations to seek and create solutions to the issues of change management. While e-business is often mixed with electronic commerce (e-commerce), they are completely different concepts. E-business encompasses e-commerce as well as many other applications. There are more benefits to be derived from e-business than from e-commerce. E-business can lead to competitive advantage as well as profitability. The authors' findings provide the foundation for a more rigorous study of e-business.
1. Introduction : E-Business is the application of information and communication technologies in support of all the activities of business. .It is essential to understand the difference between E-Business & E-Commerce to practically understand and accept the merits and demerits of the both. There are many factors which act as stone blocks in the roads of E-Business growth in the developing countries like India. Though E-Commerce has tasted much success in India and has provided Indian Business a new heights, global reach, competitive advantage, acquiring new customers, global reforms, global acquisition of companies, foreign product knowledge, helping to reduce the socio-economic factors of the government, and so many to count.
Electronic business commonly referred to as "eBusiness" or "e-business", or an internet business, may be defined as the application of information and communication technologies (ICT) in support of all the activities of business and enable the external activities and relationships of the business with individuals, groups and other businesses. The term "e-business" was coined by Lou Gerstner, CEO of IBM's marketing and Internet teams in 1996.
Electronic Business, or “e-Business”, may be defined broadly as any business process that relies on an automated information system. E business may be defined as “The transformation of an organization’s processes to deliver additional customer value through the application of technologies, philosophies and computing paradigm of the new economy. Electronic Business project makes a theoretical knowledge in the area of business which is mainly done through the internet and telecommunication facilities. Electronic business methods enable companies to link their internal and external data processing systems more efficiently and flexibly, to work more closely with suppliers and partners, and to better satisfy the needs and expectations of their customers.
2. Need of the Study
Growth of E-Business in India is tremendous but still has lot of barriers which are the obstacles in the way of E-Business. It needs a focus and should be prioritize to make the country in the lines of E-Business. We should look into these barriers and steps should be taken to address them. In this paper we describe the definitions and understanding of E-business, the differences between E-Commerce and E-Business, its advantages over traditional commerce, E-Business in India. It also helps to generate new horizons in business, especially in electronic business. This research study helps to reveals the opportunities in internet related business in front of the researcher. In this paper we present you list of the factors and the reasons behind these factors which affect the growth of E-business, proposed solutions for some of these factors.
3. Literature review
Novitski [11] conducted a study of MBA and MS programs in e-business and also found many of the programs were housed in a variety of schools and programs: in business schools.
Some authors, such as Rappa (Rappa, 2001), provide a taxonomy of e-business models rather than an explanation of what elements such a model contains. For him a business model spells-out how a company makes money by specifying where it is positioned in the value chain. His classification consists of nine generic forms of e-business models, which are Brokerage, Advertising, Infomediary, Merchant, Manufacturer, Affiliate, Community, Subscription and Utility.
E- commerce is Fundamentally changing the economy and the way businesses are conducted today (Barua et al., 2001). It forces firms to find new ways to expand the markets, to attract and retain the costumers by tailoring products or services to their needs, and to restructure their business processes in order to deliver high quality products and services more efficiently and effectively (Chan and Davis,2000)
4. Methodology of the Study
E-business research work conducted is mainly in descriptive in nature. Data is collected from all possible authentic sources. Collected data is mainly concerned with secondary data according to the method of data collection. The majority of the data are collected through various websites, from the various books from the library and reports and from journals and manuals.
5. Scope of Study
This paper helps to know the importance of emerging trends of e- business in the normal business world. The study tends to give an idea about how the e- business performs successfully in the dynamic technological environment and what is its future in the developing country like India. The study is to identify the future and opportunities of e- business.
6. E-Business Vs. E-Commerce
In practice, e-business is more than just e-commerce. While e-business refers to more strategic focus with an emphasis on the functions that occurs using electronic capabilities, e-commerce is a subset of an overall e-business strategy. E-commerce seeks to add revenue streams using the World Wide Web or the Internet to build and enhance relationships with clients and partners and to improve efficiency using the Empty Vessel strategy. Often, e-commerce involves the application of knowledge management systems.
E-business involves business processes spanning the entire value chain: electronic purchasing and supply chain management, processing orders electronically, handling customer service, and cooperating with business partners. Special technical standards for e-business facilitate the exchange of data between companies. E-business software solutions allow the integration of intra and inter firm business processes. E-business can be conducted using the Web, the Internet, intranets, extranets, or some combination of these.
The emergence of electronic business is one of the most profound changes that revolutionized the process of buying, selling, and exchanging products and services over the Internet. Organizations and customers have access to vast amounts of data, information, and services that are not limited in time or space. There is a growing demand in electronic business research that will provide insights into issues, challenges, and solutions related to the successful application and management aspects of electronic business.
Basically, electronic commerce (EC) is the process of buying, transferring, or exchanging products, services, and/or information via computer networks, including the internet. EC can also be beneficial from many perspectives including business process, service, learning, collaborative, community. EC is often confused with e-business. Though the terms are related and sometimes used interchangeably, e-business and e-commerce are not exactly the same. In the emerging global economy, e-commerce and e-business have increasingly become a necessary component of business strategy and a strong catalyst for economic development.
The integration of information and communications technology (ICT) in business has revolutionized relationships within organizations and those between and among organizations and individuals. Specifically, the use of ICT in business has enhanced productivity, encouraged greater customer participation, and enabled mass customization, besides reducing costs.
E-business is a vast term encompassing the various business processes that aim to integrate the vendors or traders with the consumers and suppliers using the Internet. The entire process of setting up a website, helping the prospective customers navigate through the website, showing them the available products, offering discounts and vouchers and doing everything possible to woo the prospective clients and converting them into customers, comes under the purview of e-business. E-commerce, on the other hand, is a subset of e-business and refers to online transactions that can be accounted for in monetary terms. For instance, accepting credit card payment for products sold to consumers or making payments for shopping online are examples of e-commerce. In other words, e-commerce refers to the last stage of e-business which involves collecting payments for the goods sold by the business firm.
7. Varieties of E- Business
Three primary processes are enhanced in e-business:
1 .Production processes: Which include procurement, ordering and replenishment of stocks; processing of payments; electronic links with suppliers; and production control processes, among others;
2. Customer-focused processes: which include promotional and marketing efforts, selling over the Internet, processing of customers’ purchase orders and payments, and customer support, among others; and
3. internal management processes: which include employee services, training, internal information-sharing, video-conferencing, and recruiting. Electronic applications enhance information flow between production and sales forces to improve sales force productivity. Workgroup communications and electronic publishing of internal business information are likewise made more efficient.
8. Models of E- Business
When organizations go online, they have to decide which e-business models best suit their goals. A business model is defined as the organization of product, service and information flows, and the source of revenues and benefits for suppliers and customers. The concept of e-business model is the same but used in the online presence. The currently most adopted e-business models are- E-shops, E-commerce, E-procurement, E-malls, E-auctions, Virtual Communities, Collaboration Platforms, Third-party Marketplaces, Value-chain Integrators, Value-chain Service Providers, Information Brokerage, Telecommunication, Customer relationship
9. Benefits of E- business over Traditional Business:
Information Exchange- Electronic Catalogs (menu selections), Online Product/Service details, Pricing and Customization, Quality Comparisons and features information, Shipping Modes and Payment terms
Contract and Order- Customized Product Specs, Quantity, Price, discounts, Final Payment, Delivery and Service Options
Shipping and Payment- Exchange of Values, Digital Product or Service delivery over the net, Tangible products delivery tie up with third party, Payment Options- Credit Card, Digital Money, Cash-on-delivery
Customer Service- Direct reach to customer feedback, Updates to Customers on newer features and versions, Quick tracking and redressing of problems
Marketing- Internet based Advertising Mechanisms- Banner, Micro-sites, Email Campaigns, Data Generated using customer feedback, support, clicks on features, feature selections, and transactions can be used
10. Advantages of E-Business
Electronic business provides a different way of doing business that comes with its own set of benefits. The market size increases greatly to encompass the whole globe. This provides business with more customers and customers more choice. More mass customization can also be achieved. It become easier through e- business for the customer to tell a business exactly what they require and individualize products or services. Also, electronic business allows the supply chain to be shortened; products can sometime be shipped directly from the manufacturer to the customer. Even though there are benefits to both consumers and businesses there are still issues limiting electronic commerce effectiveness. These issues have to deal with the problems related to privacy. There is a general lack of trust in what is happening to customer’s information and the security of their data.
Increasing consumer confidence in e-commerce is one of the biggest challenges facing this form of business. Companies have to prove they can be loyal and trustworthy to their customers. We can see the importance of these qualities by seeing that some of the most profitable e-commerce companies are those that also have traditional stores. These companies already have a strong customer base that is confident in them and helps make it easier for consumers to trust their online stores.
Worldwide Presence: This is the biggest advantage of conducting business online. A firm engaging in e-business can have a nationwide or a worldwide presence. IBM was one of the first companies to use the term e-business to refer to servicing customers and collaborating with business partners from all over the world. Dell Inc. too had a flourishing business selling PCs throughout the US, only via telephone and the Internet till the year 2007. Amazon.com is another success story that helps people buy internationally from third parties. Hence, worldwide presence is ensured if companies rethink their business.
Cost-Effective Marketing and Promotions: Using the web to market products guarantees worldwide reach at a nominal price. Advertising techniques like pay per click advertising ensure that the advertiser only pays for the advertisements that are actually viewed. Affiliate marketing, where customers are directed to a business portal because of the efforts of the affiliate who in turn receive a compensation for their efforts meeting with success, has emerged on account of e-business. Affiliate marketing has helped both the business and the affiliates. Firms engaging in e-business have managed to use cost-effective online advertising strategies to their advantage.
Better Customer Service: E-Business has resulted in improved customer service. Many times, on visiting a website, the customer is greeted by a pop-up chat window. Readily available customer service may help in encouraging the customer to know more about the product or service. Moreover, payments can be made online, products can be shipped to the customer without the customer having to leave the house.
Reduces Time and Money Spent: In e-business, there is often a reduction in costs required to complete traditional business procedures. Many of those same traditional business approaches can be eliminated and replaced with electronic means, which are often easier to carry out as well as easier on the pocketbook.
Gives a Competitive Advantage: The internet opens up a brand new marketplace to businesses moving online. Competition via the internet is growing as the internet itself grows and waiting too long to move online may cause you to lose your place in line entirely. Easy access to real time information is a primary benefit of the internet, enabling a company to give more efficient and valid information and helping to gain the competitive advantage over those that are not online.
Economic Advantages: From an economic aspect there have been several advantages to electronic commerce. In particular consumers have more suppliers, sometimes including foreign suppliers. Searching the Internet can also be done to find the lowest price. In general the market becomes larger and makes for more competition. This increased competition can bring down prices for consumers and other businesses. Further, the increase in information and choice available can help increase the efficiency of supply and demand equilibrium. Also, with increased competition companies they will try to become more efficient. This may be by new technologies or methods that reduce costs and increase productivity. In turn from this lower prices may occur or the emergence of new technology.
11. Disadvantages of E-Business
Sectoral Limitations: The main disadvantage of e-business is the lack of growth in some sectors on account of product or sector limitations. The food sector has not benefited in terms of growth of sales and consequent revenue generation because of a number of practical reasons like food products being perishable items.
Costly E-Business Solutions for Optimization: Substantial resources are required for redefining product lines in order to sell online. Upgrading computer systems, training personnel, and updating websites requires substantial resources. Moreover, Electronic Data Management (EDM) and Enterprise Resource Planning (ERP) necessary for ensuring optimal internal business processes may be looked upon, by some firms, as one of the disadvantages of e-business.
It's evident that the advantages clearly outweigh the disadvantages of e-business. Every business has to eventually change its modus operandi and adopt e-business practices in order to ensure survival and success. Even if a provider of E-commerce goods and services rigorously follows “key factors “of an exemplary e-commerce strategy, problems can still arise. Sources of such problems include:
• Failure to understand customers, why they buy and how they buy. Even a product with a sound value proposition can fail if producers and retailers do not understand customer habits, expectations, and motivations.
•Failure to consider the competitive situation. One may have the will to construct a viable book e-tailing business model, but lack the capability to compete with Amazon.com.
• Failure to coordinate. If existing reporting and control relationships do not suffice, one can move towards a flat, accountable, and flexible organizational structure, which may or may not aid coordination.
• Presence of fraud. This is where your details (name, bank card number, age, national insurance number) are entered into what look to be a safe site but really it is not. These details can then be used to steal money from you and can be used to buy things on line that you are completely unaware of until it is too late.
• Failure to follow a plan. Poor follow-through after the initial planning, and insufficient tracking of progress against a plan can result in problems. One may mitigate such problems with standard tools: benchmarking, milestones, variance tracking, and penalties and rewards for variances.
Economic disadvantages: Electronic commerce does have some negative effects on the economy. The availability of goods online should increase competition and in turn lower prices, but this does not always occur. A good reputation may allow a retailer to hold some control over their area of the market. Further, companies can also find with ease the prices of their competitors allowing them to react immediately to changes. In the worst-case scenario this monitoring may not involve any changes to price. A price that is not advantageous to the consumer may be kept because no company is willing to lower their price because it would not be profitable. That is, a company may be willing to lower their price because the increase in sales would offset the lower price. As a result of the minimal information competition will not be as high and prices may not be lower.
12. Growth of E-Business
Tremendous growth in managing a large volume of data storage and retrieval techniques, in the eighties, followed by the development of a transparent mechanism to interconnect; improved data transfer rates; and the emergence of global connectivity, based on TCP/IP standards, have provided the opportunity to manipulate and disseminate information spread across vast geographic areas. The development of a communication infrastructure in the late eighties and early nineties, in the form of the Internet, and related development in web technologies have propelled us towards anew economic era. This new economy, driven by the internet and web technology, is also called “digital economy”.
Electronic commerce provides a different way of doing business that comes with its own set of benefits. The market size increases greatly to encompass the whole globe. This provides business with more customers and customers more choice. More mass customization can also be achieved. It become easier through e-commerce for the customer to tell a business exactly what they require and individualize products or services. Also, electronic commerce allows the supply chain to be shortened; products can sometime be shipped directly from the manufacturer to the customer.
This is the case where in a traditional business they would have to pay for labour to complete the transaction, but by making the transaction electronic there is minimal labour cost. These are a few examples of some general benefits of electronic commerce. Even though there are benefits to both consumers and businesses there are still issues limiting electronic commerce effectiveness. These issues have to deal with the problems related to privacy.
There is a general lack of trust in what is happening to customer’s information and the security of their data. Increasing consumer confidence in e-commerce is one of the biggest challenges facing this form of business. We can see the importance of these qualities by seeing that some of the most profitable e-commerce companies are those that also have traditional stores. These companies already have a strong customer base that is confident in them and helps make it easier for consumers to trust their online stores
Original e-business applications were based on getting needed data to the consumer. In other words the major concern was integrating current catalogues and data into an online format from which consumers could shop. A simple and enjoyable experience is what customers are demanding and they do not want to be concerned with the technology behind it
13. Latest trend of E-Business
Virtual agents: One area of research into making interactions more natural is by using virtual agents. The goal of these agents is to actually converse with customers and be able to act proactively when dealing with customers. These agents would appear to e-commerce clients at 2D or 3D animations that would be capable of expressing facial emotions to try to simulate a natural environment. Virtual agents make the business informative as possible. Often consumers want to search e-commerce sites to gain further information, but this can prove frustrating at times. The virtual agent’s role would be to eliminate this frustration. Virtual agents would be given as much information regarding customers, products and sales processes as possible. They would then become the focal point on an e-commerce site for providing information accurately and effectively. Some other trends are:
1. Ready access to the Net from multiple gateways-cable TV, satellite, wireless telephones, and other devices-will greatly expand e-business opportunities.
2. Producing, marketing, and distributing products or services online will be a cost-effective strategy for business.
3. E-business that enables customers to personalize and customize products or services will flourish.
14. E-business in India
E-Business is the application of information and communication technologies in support of all the activities of business. Commerce constitutes the exchange of products and services between businesses, groups and individuals and can be seen as one of the essential activities of any business. Electronic commerce focuses on the use of IT to enable the external activities and relationships of the business with individuals, groups and other businesses. It is essential to understand the difference between E-Business & E-Commerce to practically understand and accept the merits and demerits of the both. There are many factors which act as stone blocks in the roads of E-Business growth in the developing countries like India. Though E-Commerce has tasted much success in India and has provided Indian Business a new heights, global reach, competitive advantage, acquiring new customers, global reforms, global acquisition of companies, foreign product knowledge, helping to reduce the socio-economic factors of the government, and so many to count. In the same way, there are many demerits as well like we cannot touch and feel the item we purchased, expensive items should be insured before the delivery, cannot bargain the products to purchase for, delay in deliveries and a couple more. But the demerits are negligible and can get better with time compared to the real advantages of E-Commerce. Existing Practices in India with Respect to Buying and Paying Online:
Factors affecting growth of E-business in India: Factors which are affecting the growth of E-Business in India are listed below:
• Lack of IT policies and effective cyber laws
• Lack of trust among customers: You have to deliver the product, safe and secure, in the hands of the right guy in right time frame. Regular post doesn’t offer an acceptable service level. Couriers have high charges and limited reach. Initially, you might have to take insurance for high value shipped articles increasing the cost.
• Indian people (especially females) have tendency to bargain the products, which is not feasible in E-commerce
.• Different local languages and cultural factors
• Lack of awareness and understanding of the value of e-commerce
• Continuous change in technologies, emerging new technologies
• Not sure of product quality
• Need to wait for delivery once product is ordered since widely spread regions
• No significant discounts on the products to purchase
• Shipping costs are high due to big geographical area
• Security. Ensuring security of payments and privacy of online transactions is key to the widespread acceptance and adoption of e-commerce
.• Internet costs: To depend on speed, bandwidth of internet (Approximately around 1.6 million households connected to the Internet)
• Financial costs – for storing information, continuous change of technologies, processing orders
• Taxations: Octroi, entry tax, VAT and lots of state specific forms which accompany them. This can be confusing at times.
Proposed Solutions
• Providing easy access and inexpensive and easy access to information networks
• Legal recognition of e-commerce transactions
• Consumer protection from fraud
• Protection of consumers’ right to privacy
• Legal protection against unauthorized access to computer systems);
• Protection of intellectual property
• Full implementation of Cyber Law and IT Acts
• Educating people about online shopping and its benefits
• Reduction of delays in delivery
• Providing some way to touch, look and feel the products
• Reaching remote and rural areas
• Providing and helping the farmers to sell the agricultural and tropical products to sell online by quoting their rates as per market regulations
• Food processing industries, agricultural markets should provide access to the farmers of cooperative societies of every area where farmers and traders can sell their products to these industries online and fair manner by removing the concept of intermediaries.
• Government agencies should be able to trade electronically with all suppliers using open standards-through ‘agency enablement’ programs, “supplier enablement” programs, and e-procurement information systems.
15. Future of E-Business
• The attempt to paint a clear picture of the future is always fertile. The predictable part of the future, however, will be the efforts of solving the major problems we face today and the possibility of that some of technical and business initiatives at the infant stage today will become main stream tomorrow.
• The Internet and the Web have overcome the technical difficulty of EDI, but It has not solved the problem of slow development of ecommerce standards. The development and acceptance of standards will significantly impact the future success of the electronic commerce. XML will play a pivotal role in that process.
• The continuing acceptance of broadband technology and maturity of technology for delivering broadband applications (video on demand, online gaming and etc.) to the end users will drastically impact the consumer marketing near future. The ability to present multimedia applications to consumers will transform the Internet from an information tool to an entertainment tool. The Web, as the fourth medium, has the potential to integrate other three types of media (print, radio and video) in one way or another
16. Limitation of the study
•Time for the entire project work is not sufficient.
•Personal biases in the data collection.
•Availability of data is limited.
17. Conclusion
There are several factors affecting the growth & progress of E-business in developing countries like India as discussed above. There is certain importance of SMEs & e business has direct influence on this. Proposed solutions explained above can boost the growth of e business in India. Educating people on e commerce, companies adapting the changing needs of current technologies, e commerce in rural areas can reduce the factors which act as barriers for the growth of e business in developing countries.
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