Ch # 10 Effectiveness of ICT

Question 1

definition of E-business

Answer 1

E-business includes all aspects of e-commerce, but also includes work flows and movements of information within an entity.
or
E-business is ‘automated business processes (both intra- and inter-firm) over computer
mediated networks’ (OECD).

For example between departments or
functions. Internal processes are driven by e-business methods as well as external
relationships with customers, suppliers and other external stakeholders.

Question 2

definition of ecommerce

Answer 2

‘all electronically mediated information exchanges between an organisation and its external stakeholders
Buying and selling of goods and services, or the transmitting of funds or data, over an electronic network, primarily the Internet.

Question 3

E-business implications for performance management.

Answer 3

• the objective is to increase efficiency and competitiveness
• it does not simply involve automating the business process but also radically redesigning it to make it more efficient and add value.
• it can change the nature of the market such as through globalization
• it can also change the nature of relationships with suppliers and customers.

Question 4

explain interactivity in 6Is of marketing

Answer 4

traditional media is push media while a website is a pull medium.
The internet can also be used to establish interactivity with customers, and create a dialogue. Interactivity is a very powerful marketing device. Interactivity takes several forms, such as,
-getting visitors to the site to provide details about themselves
-getting visitors to buy a product or service and pay for it using the internet.

obtained the e-mail address of an individual, opportunities exist for the continuation of the dialogue in the future, through e-mail marketing messages and ‘information updates

Question 5

explain intelligence in 6Is of marketing

Answer 5

relatively low-cost method of collecting market research data and data about customers and other visitors to a website.
data collected can be analyzed to produce marketing information about what customer buys and what are the preferences

clickstream analysis of data on a website log file can be used to build up a picture of customer preferences, and
possibly also to identify different market segments.

Question 6

explain individualisation in 6Is of marketing

Answer 6

In traditional media the same message tends to be broadcast to everyone. Communication via the internet can sometimes be tailored or ‘personalised’ to the individual.

Question 7

explain integration in 6Is of marketing.

Answer 7

1. The internet provides the scope of integrating marketing communications.
2. Internet complements other marketing channels to deliver customer service.
   such as integrating e-mail response and website call back into their existing call centres or customer service operation.
3. this can require substantial investments in training a new software.

Question 8

explain industry restructuring in 6Is of internet marketing

Answer 8

The internet can lead to a re-structuring of the industry supply chain
-disintermediation of traditional distribution channels and sales agents
-reintermediation of new intermediary companies.

Question 9

explain independence of location in 6Is of internet marketing.

Answer 9

-The internet introduces the possibility of increasing the impact of an entity on a global market.
-users cannot easily tell whether the website is owned by a small company or a large multinational
-The internet also makes it possible to sell to a country without a local sales force

Question 10

what is E-branding?

Answer 10

E-branding is a collection of perceptions in the mind of the customer. these perceptions can be positive or negative.
A strong brand is important because it immediately confers a certain amount of recognition when consumers are
choosing products and services.

Question 11

what is brand identity and how it can be created.

Answer 11

brand identity is the elements that are used by a customer to recognise a brand: logos, symbols, colours, packaging etc.

four choices are available for establishment of brand identity.

1. duplicate the existing brand name in a traditional market.
2. Extend the traditional brand by creating slightly different version of the brand
3. Partner with existing e-brand
4. create new brand for the web

Question 12

explain the CRM

Answer 12

customer relationship management (CRM) is to help companies to understand better the behaviour of their customers, and modify their marketing operations to service customers in the best way possible.

Its objectives are to:

• Find out more about the purchasing habits and preferences of customers
• Profile the characteristics and needs of individuals customers and groups of customers more effectively
• Change the way the company operates, in order to improve its service to customers and the marketing
  of its products.

Question 13

explain the functions of CRM

Answer 13

• Collect information for identifying individual customers and categorising their behaviour.
• Store the customer information and keep it up-to-date.
• Access the information, often instantly, whenever it is needed
• Analyse customer behaviour.
• Use the analysis of customer behaviour to develop a more effective marketing strategy.
• Provide customers with a better ‘experience’ when they contact the company.
• Monitor key customer management performance indicators,such as the number of customer complaints.

Question 14

Explain the impact of internet on the competition within many industries within the framework of porter’s five forces model.

Answer 14

1. Competitive Rivalry
   The internet encourages greater competition.
   Companies provide a large amount of information about themselves and their products on their websites. This makes it easier for competitors to copy what they are doing. As a result of the stronger competition, selling prices are depressed.
2. Threats of new entrants
   By using the internet, new competitors can enter the market quickly and cheaply. companies can enter the market using the internet to market their products or services. They do not need to employ an expensive full-time sales force, or distribute their products through (expensive) traditional retail
   networks.
3. Bargaining power of suppliers
   Suppliers are able to use the internet to increase the number of clients
   or customers for their products. As a result, the bargaining power of suppliers is likely to increase.
4. Bargaining power of customers
   Customers are able to obtain information about the rival products of many different
   competitors, by using search engines such as Google and visiting many different websites. ‘The reality is that customers using the internet are finding it easier to switch suppliers, and the openness of the internet and its standards makes it difficult for a customer to maintain its customer network intact.

Question 15

what are the effects of internet on individual firms sustaining competitive advantage?

Answer 15

Competitive advantage is achieved through operational effectiveness (reducing costs)
and strategic positioning (differentiation).

Porter has argued that the internet affects operational effectiveness because it allows companies to exchange information in real time across its entire value network.

• However, the internet also makes it
  difficult for companies to use this improved operational effectiveness as a sustainable competitive advantage. Methods of using the internet devised by a company are fairly easy to copy. ‘Companies converge on the same applications with the same benefits – benchmarking and copying best practices
  make any operational advantage difficult to sustain.
• Porter also argues that firms can gain sustainable competitive advantage using the
  internet, but only from superior strategic positioning. They need to link the IT platform provided by the internet to ‘critical corporate assets’ such as skilled personnel, a proprietary product or a very efficient
  delivery (logistical) system.

Question 16

list down market places and businesses for delivery of e-business

Answer 16

Selling goods and services.
Providing electronic auctions
New intermediary companies.
Alliance of suppliers
E-procurement.
Advertising.
Promotion
Customer relationships.

Question 17

how e-commerce effects the globalization of business and its implications on business

Answer 17

Internet and email has made it easier for suppliers to make contact with customers in geographically-distant countries and for customers to search for suppliers in other countries of the world.

Suppliers and customers can communicate with each other much more quickly and easily, in spite of differences in time zones.

Suppliers can try to attract more customers from wider geographical markets by advertising their goods or services on their website

Implications
Although the size of the market increases competition has become global
since companies have to compete in domestic as well as international markets many companies need to set up a foreign subsidiary for which computer network can provide management with the information they
require to apply suitable control to the group.

Question 18

list down the barriers to e-business

Answer 18

Setup costs
Type of business
On-going operating costs.
Time to establish the system
No in-house skills.

Question 19

how big data can add value to the organization

Answer 19

1. Creating transparency.
   Improved accessibility for relevant stakeholders in a timely manner can create
   value.
2. Enabling experimentation to discover needs, expose variability and improve performance.
   Organisations are able to collect and analyse ever more accurate and detailed performance data on everything from personal sick days to product inventories. They can develop processes then set up controlled experiments and use the data to analyse variability in performance.
3. Segmenting populations to customise actions. Big data enables highly specific segmentation to be developed to support tailored products and services that precisely meet those needs. Whilst common in areas such as marketing and risk management, this approach has the potential to revolutionise other areas where populations are more homogenised (treated the same) such as in the public sector.
4. Replacing/supporting human decision-making with automated algorithms.
   big data can substantially improve decision making, minimise risks and unearth valuable insights that would otherwise remain hidden.
5. innovating new business models, products and services. Big data enables companies to enhance existing products, create new products and services and invent entirely new business models. GPS based location services and airlines use big data to develop its products.

Question 20

Explain the number of strategies for commercially leveraging big data

Answer 20

1. Performance management
   the underlying data is transactional This involves understanding the meaning of big data in company databases and using predetermined queries and multidimensional analysis.
2. Data Exploration
   also leverages existing transactional data but involves using statistics to experiment
   and challenge areas managers may not have previously considered. Cluster analysis is one technique used to segment customers into groups based on similar attributes which may not have previously been identified by managers.
3. Social analytics
   Social analytics measures three key areas: awareness, engagement and word-of-mouth (reach). They are critical for businesses as they help inform managers of the success of
   their external and internal social digital campaigns and activities.
   - non-transactional data
   - data is generated on social media platforms
4. Decision science.
   decision science explores social big data in order to conduct field research and test hypotheses. This could include initiatives such as crowdsourcing, ideas generation and polling.