Chapter 4 Flashcards
Which B2B model(s) should we use for e-
procurement?
When evaluating the various upstream B2B models, we need
to match the suitable e-procurement goals with solution strategies depending upon whether the purchases are direct
material or indirect material. Four typical goals that should be distinguished are organizational operational efficiency,
minimum price, minimum inventory and stockouts, and low administrative costs. For each of these goals, the appropriate
solution and system should be designed accordingly. Managing many small and medium suppliers that do not have
sophisticated systems is a challenging goal.
Which B2B model(s) should we use for online B2B sales?
A key issue for B2B sales is how to reconcile with the
multiple buyers who adopt different EDI and ERP systems. The Enterprise Application Integration (EAI) solution trans-
forms the internal data of multiple EDI formats used by different buyers. The integration of various types of EDI stan-
dards with ERP solutions is another challenge to overcome. In addition to contract management, B2B marketers use
auctions, liquidations, and social networks to increase sales.
Which solutions and vendor(s) should we select?
Vendors normally develop and deploy B2B applications, even for
large organizations. Two basic approaches to vendor selection exist: (1) Select a primary vendor such as IBM (ibm.
com), Microsoft (microsoft.com), or Oracle (oracle.com). This vendor will use its software and procedures and add
partners as needed. (2) Use an integrator that will mix and match existing products and vendors to create “the best of
breed” for your needs.
What is the organizational impact of B2B?
The B2B system will change the role of the procurement department by
redefining the role and procedures of that department. The function of the procurement department may be completely
outsourced. A procurement policy portfolio is necessary to balance strategic sourcing items and spot purchasing items
and design a supply relationship management system
What are some ethical issues in B2B?
Because B2B EC requires the sharing of proprietary information, business ethics
are necessary. Employees should not be able to access unauthorized areas in the trading system, and the privacy of trad-
ing partners should be protected.
Which type of social network should we use—private (proprietary) or public?
There are successes and failures in
both types. Some large companies have both types (e.g., northwesternmutual.com). In most cases, it is better to use
public networks such as linkedin.com and facebook.com.
Which business processes to automate?
It depends on the company, industry, and value chain. However, as illustrated
in this chapter, selling and purchasing and other activities along the supply chains are the prime targets. These include
payments (financial supply chains). Also important are logistics, shipments, and inventory management.
