BB0025 – E Commerce – 2 Credits
(Book ID: B0035/B0104)
Assignment Set- 1 (30 Marks)
Note: Each question carries 10 Marks. Answer all the questions. Q.1 Let us examine the simple task when an employee of a company wants to buy a PC for his office. Company
Generate request for PC including the specifications.
Approval process has to pass through one or more than one person, depending upon the cost involved, the position and/or right of the person. Once sanctioned, request passes on to the purchasing department. Identify the item & supplier: Selection of appropriate model & supplier, with the help of office supply catalog. The person in the purchasing department has to check more than one catalog and contact the suppliers to find out the availability, present cost or may be latest version. Issue a purchase order, fax or mail it to the supplier.
Verify the credit and sales history of the ordering company. Check the warehouse for inventory; find out when it can be delivered to the desired location, within the time frame. Once the supplier is satisfied, then Create a transportation and inform the warehouse.
Create an invoice for the PC and mail it.
Finally PC reaches the office & the company pays the bill for PC by some standard means. Once the above given processes are digitized (if not, most of the steps) business can be done online in e-Commerce. Certainly e-Commerce results in reduction of procedural overheads, hence better performance at reduced cost and time. a. What are the procedural overheads you come across in the traditional commerce?
The traditional commerce is where all three components are physical. In contrast, these components are all digital at the core of electronic commerce, where not only production, but also delivery, payment, and consumption (reading online or processing by a computer program) occur online. The remaining white areas are part of conventional electronic commerce, in which some of the components are digital. For example, products may be physical, but marketing and payment may be conducted online; products may be digital, but payments could be made via checks, or buyers may be reading printouts instead of screen outputs. The growing use of digital processes for business-to-business transactions and consumer marketing is evident in the figure, which shows that electronic commerce dominates the traditional market. Market activities, from production to consumption, occurring online, bypassing all paper-based transactions and traditional communications media, represent the future of electronic commerce. The Internet becomes not only an alternative communication medium, but a microcosm, or an electronic version, of physical markets with characteristics that are fundamentally different from physical markets. This digital world of business, in which market institutions, agents, and products are becoming "virtual" and native to the Internet, is also at the core of electronic commerce economics. The main difference between the digital world of business and the traditional, physical business world stems from the very nature of digitized products. However, there are many reasons why consumers too will behave differently in a networked market. For example, access to product information via the network using sophisticated computer programs will certainly affect the way consumers compare prices. In turn, efficient shopping will affect product choices, pricing strategies, and competitive efforts among sellers. Business organizations and relationships will also be affected as spatial and temporal limitations of the market are removed and replaced by different considerations of costs, efficiencies, and the mode of interaction on a network. In other words, the market environment, enabled by the open distributed Internet, resembles no other physical market. The physical distance and geographical topology of...