MODULE 3

INTRA ORGANISATIONAL COMMERCE

When e-commerce transaction does not involve multiple organization, then, it is

termed as Intra-organizational e-commerce.

it is emerging field which facilitates information collection and transfer within

organization for a speed redress of grievances of common man.

Advantages:

1.enhancing communication capability among employees of department ensuring

fast decision making.

2.tends to reduce record maintenance by eliminating the conventional way of

record keeping.

3. In government departments collection of information is a prime concern by

storing information in digital formats it provides efficient way of sharing
information and expertise idea.

4.increased customer satisfaction as whole information is available at a click of a

mouse without visiting office premises.

Intra- Organizational means promotions of services /products by a company

within their employee by offering some incentives/discounts.

• Work flow
A workflow consists of an orchestrated and repeatable pattern of business
activity enabled by the systematic organization of resources into processes
that transform materials, provide services, or process information. It can be
depicted as a sequence of operations. Following are the advantages of the
work flows:

o It is used to determine the amount of cross functional activities in which

the organization integrates.
o It should provide in-time completion and reduce the complexity of the
process

o In an organization the cross functional activity depends on three different

activities.
-Improving the existing process by utilizing the technology
- Identifying the technology required information that is needed for
each process.
-Integrating application programming interface, database access
etc.
⚫ Electronic commerce cannot reach its full potential as a stand-alone
concept addressing mainly customer-organization, inter-organizational,
or disconnected internal automation activities. For companies to be fully
effective these three activities must be integrated and the corresponding
software applications developed together.
⚫ In electronic commerce scenario, effectiveness and efficiency of business
process execution is of supreme importance for business success. They
determine the chances of survival of organizations in fast moving, highly
competitive electronic markets. To obtain the essential levels of
effectiveness and efficiency, well-structured business process support is
required.

• Automation
A work flow portrays the movement of a business process and its associated
tasks among workers and the operations required to process relevant
information as it moves from initiation to completion.
The processes (vision) of automating routine business tasks is called work
flow automation.
The goal of the work flow automation is to be timely complete, cost effective
and integrate ways to make business decisions.
All work flows taken together constitute a process. For automation
knowledge-based business process can be defined. The work flow can be
decomposed into different individual tasks with certain order. A work flow
can be complex or simple.

• Customization and Internal Commerce

Customization:
Technology is resulting in transforming consumer choices, thus further
changing the marketplace and organization itself. Technology embodies
adaptability; flexibility and other qualities essential for customization.
Customers can have their own version of virtually any product.
Customization can also be used in textiles and clothing.

- Customer- driven customization is becoming crucial because of many

choices in the same product. But all markets are not well suited for the
application of customization principles. For example, the customers of
commodities like oil, gas and wheat do not ask for product differentiation.

- Mass customization is the process of delivering wide-market goods and

services which are modified to satisfy a specific customer's need.
- Collaborative customization - companies work in partnership with clients
to offer products or services uniquely suited to each client
- Adaptive customization - companies produce standardized products
which the end user may customize
- Transparent customization - companies provide unique products to
individual clients without overtly stating the products are customized
- Cosmetic customization - companies produce standardized products but
market them in different ways to various customers.

• Internal Commerce:
-Internal commerce system is the effective utilization of information and
data. The information is often scattered around the organization and
stored in machines, places, and formats not easily accessible and often
requiring lot of expertise to even get to them. This will impact the
productivity of the corporation.
-To rectify this problem, the field of corporate digital library is emerging
around Internet and distributed networking.

• Supply Chain Management

• Supply chain management (SCM) is also called ‘extending’, meaning
integrating the internal and external partners on the supply and process
chain to get raw materials to the manufacturer and finished products to
the consumer.

• SCM optimizes information and product flows from the receipt of the
order to the purchase of raw materials to delivery and consumption of
finished goods
A) SCM has the following characteristics:

- Ability to manage the information across industries and enterprises

- A centralized global business and business strategy with local execution

- Ability to source raw material or finished goods from anywhere in the

world
B) SCM have various functions:

- Supply chain management: The goal is to reduce the number of suppliers

and get them to become partners in business in a win / win relationship.
- Inventory management: Its goal is to shorten the order-ship-bill cycle.
 - Distribution management: Its goal is to move documents related to
shipping.

- Payment management: The goal is to link the company and the suppliers
and distributors so that the payment can be sent and received
electronically.

- Financial management: The goal is to enable global companies to manage

their money in various foreign exchange accounts.

- Sales for productivity: Its goal is to improve the communication and flow
of information among the sales, customer and production functions.

C) Each model (push/pull) has three primary elements:

I) Agile manufacturing
It calls for flexibility and quick response to changing market conditions,
customer demands, and competitor actions.
II) Integrated logistics and distribution
It deals with integration of materials and physical distribution. Logistics
and distribution can add up to as much as 30% of total cost for some
business. Engineering companies are discovering creative methods of
adding value, cutting costs and increased speed of the product through
supply chain management.
III) Purchasing and inbound logistics:
Take an example of supply scheduling, it requires the following steps:

o The planner requisition sends to the buyer then buyer sends the purchase
order to the supply sales department via EDI.

o Then the sales department communicates the order to the planner in the
supplier’s plant.

E-commerce impacts supply chain management in a variety of key ways.

These include:
1.Cost efficiency:
E-commerce allows transportation companies of all sizes to exchange cargo
documents electronically over the Internet. E-commerce enables shippers,
freight forwarders and trucking firms to streamline document handling
without the monetary and time investment required by the traditional
document delivery systems. By using e-commerce, companies can reduce
costs, improve data accuracy, streamline business processes, accelerate
business cycles, and enhance customer service.
2. Changes in the distribution system:
E-commerce will give businesses more flexibility in managing the increasingly
complex movement of products and information between businesses, their
suppliers and customers.
3. Customer orientation:
Using the Internet for e-commerce will allow customers to access rate
information, place delivery orders, track shipments and pay freight bills.
Making more information available about the commercial side of companies,
businesses will make their web site a place where customers will get detailed
information about the services the company offers. E-commerce functions
are taking companies a step forward, by providing customers with a faster
and easier way to do business with them.
4.Shipment tracking:
E-commerce will allow users to establish an account and obtain real-time
information about cargo shipments. It allows customers to track shipments
down to the individual product and perform other supply chain management
and decision support functions. The application uses encryption technology
to secure business transactions.
5.Shipping notice:
E-commerce can help automate the receiving process by electronically
transmitting a packing list ahead of the shipment. It also allows companies to
record the relevant details of each pallet, parcel, and item being shipped.

6.Freight auditing:
This will ensure that each freight bill is efficiently reviewed for accuracy. The
result is a greatly reduced risk of over payment, and the elimination of
countless hours of paperwork, or the need for a third-party auditing firm.
7. Shipping documentation and labeling:
There will be less need for manual intervention because standard bills of
lading, shipping labels, and carrier manifests will be automatically produced;
Paperwork is significantly reduced and the shipping department will
therefore be more efficient.
8. Online shipping inquiry:
This gives instant shipping information access to anyone in the company,
from any location. Parcel shipments can be tracked and proof of delivery
quickly confirmed.

CORPORATE DIGITAL LIBRARY

• Internal Commerce system is the effective utilization of information and
data. The information is often scattered around the organization and stored
in machines, places, and formats not easily accessible and often requiring
lot of expertise to even get to them. This will impact the productivity of the
corporation

• To rectify this problem, the field of corporate digital library is emerging

around Internet and distributed networking

• Documents are becoming increasingly digital and the problem of managing

documents becomes very important. Document management describes a
variety of functions including document authoring and scanning, repository
archiving, document distribution and delivery, document processing along
the work flow, information search and retrieval and document browsing or
viewing
• Document Library
• Many organizations manage their information through corporate library, as
it provides the architecture to model, map, integrate. Information in digital
documents is called digital library.

• Digital libraries are of two types:

o Electronic document-based digital libraries: The term document
is used to denote all non data records i.e., books, reports, e-files,
videos and audios. Digital library is simply a distributed network of
interlinked Information.
o Data-base oriented warehouses: It is a central repository for
combining and storing vast amount of data from different sources.
Sources are main frame database, lint-server database, text
reports etc.

• Document data is anything printed, written or kept as a record in a specific

medium. However it can be processed in one of two ways, digital or analog.
Digital media is usually electronic media that works on digital codes. A
computer recognises two discrete states: on and off (0 & 1). Documents that
are generated or stored in a computer is referred to Digital Documents.

• Benefits of digital documents are:

a). They are automatically entered
b). It can update existing data
c). It can reduce data entry errors

• A drawback to digital documents is that backup’s are usually required.

 • Digital Document Types
Four types of digital documents are:
1. Imaging Documents:
Document imaging is the practice of using equipment like scanners or special
cameras to take a picture of information contained in another form (usually
paper or microfilm). There are many advantages to converting paper to digital
files through the use of document imaging, and also some disadvantages.
2. Structured Documents:
A structured document is an electronic document where some method of
embedded coding, such as mark-up, is used to give the whole, and parts, of
the document various structural meanings according to a schema.
3. Distributed Hypertext Documents:
Hypertext is text displayed on a computer display or other electronic devices
with references to other text that the reader can immediately access.
 The Distributed Documents architecture consists of a number of cooperating
objects which provide a set of hypertext services to the rest of the system.
4. Active or compound Documents:
An active document is the product of a program sent from the server to the
client and run at the client site.
A compound document is also an application environment containing
program objects that can be interlinked and interacted with by a
user. Compound documents can be formed of information parts that
originate from different sources and that are assembled on the fly.

o Corporate Data Warehouses

Data warehouse is used to store information of the organization. Data
warehouses are necessary as enterprise wide data increase in both
complexity and volume, making it important to establish an information
systems architecture that transforms scattered legacy data into useful
information. o Characteristics of data warehouse are:
- An information-based approach to decision making
- Involvement in highly competitive & rapidly changing markets - Data

stored in many systems and represented differently o Functions

performed by data warehouse are:

- Allow existing transactions and legacy systems to continue in operation.

- Consolidates data from various transaction systems into a coherent set.

- Allows analysis of virtual information about current operations of decision

support.

o Types of data warehouses:

- Physical data warehouse – this is an actual, physical database into

which all the corporate data for the data warehouse are gathered,
along with the schemas and the processing logic used to organize,
package, and preprocess the data for end user access.

- Data Library – This is a subset of the enterprise wide data

warehouse. It performs the role of a departmental, regional, or
functional data warehouse.

- Decision support systems (DSSs) – these are applications that

make use of data warehouse

• The advantages are:

- Timely and accurate information become an integral part of the decision-
making process.

- User can manage and access large volumes of data in one cohesive
framework.

- Data warehousing has wide spread applicability.

- It provides point-of-sales reports instead of end-of-day reports.

 Advertising and Marketing

• Information based marketing

Many thinks that online marketing is equivalent to publishing a World Wide
Web page with product information that shopper can browse through.
Marketers are learning that valuable information can be collected from the
customers on line with minimum efforts and low cost that otherwise would
take months.The interactive marketing brought on the electronic commerce
will change the role of small business, retailers, manufacturers and media
companies.
Information based marketing can offer manufacturer and retailers a means
to do market research and customer prospecting; to establish brand loyalty,
market presence and distribute redeemable coupons and to create
customised product bundles. Product or Service Bundling is a classic
marketing strategy in which two or more complementary products and or
services are offered as a package at a discounted price. Example of bundling
include two for the price of one airline tickets, computer hardware and
software combinations, season tickets for sport and meals specials in
restaurants.
The new age of information-based marketing differentiate interactive
marketing into four areas:
I. Retailers vs manufacturers
The role of Retailers and manufacturers are fast reversing in electronic
commerce. Retailer’s vs Manufacturers have the following methods:
• Market research and customer prospecting
• Market presence method
• Product or services building method
• Information-based products pricing and priority method
II. Target and micromarketing
Electronic commerce, technology has put target and micromarketing within
the research of small business. It gives information to the micro marketers
not only about its own business but also consumer’s information. Consumer
target is two-way flow of communication between seller and buyer. Direct
mail and telemarketing are two fast growing ways to micro market.
Technology is an essential tool in micromarketing. There are two main types
of micromarketing:
• Direct-relationship micromarketing is aimed at stimulating sales at retail
establishments through direct contacts with consumers.
• Direct-order micromarketing is focused on selling products directly to
consumers in their homes or
businesses.
III. Small business vs large business
The key distinction between small and large business remains access to
national and international marketing for advertising purposes.
IV. Regulatory and legal implications of cyberspace marketing
Today, exorbitant advertising cost represents the barrier to reaching the
customer effectively. Internet and other networks plays good role in
advertising. The major difference between the internet and other I-way
advertising media are ownership and membership fees. Due to the
empowering effect of internet-facilitated advertising however, the balance
of power between large and small companies may change in future.

Interactive marketing process on the internet:

• Step 1: Segment and identify potential customers
• Step 2: Create promotional, advertising and educational material (WWW
page with multimedia effects-audio and video) (Product information and
complementary products, order forms and questionnaires)
• Step 3: Put the material on customer computer screens.
• Step 4: Interacting with customers, dialogue with the customers, interactive
discussion among customers about various features offering endorsements,
questions and answers.
 Step 5: Learning from customers Incorporating feedback from customer in
advertising and marketing strategy Identifying new market using experience
in new product development.
• Step 6: Online customer service

• Advertising on Internet
o In terms of efficiency, the advertising industry is now starting to rise out
of its century-long infancy. When the Internet hit the market, advertising
industry got a new medium.

o Internet advertising has overtaken other traditional advertising media

such as newspapers, magazines, and radio.

o With new platforms for advertising evolving on a continual basis, it can

be complicated to choose the right medium. By having a solid
understanding of certain aspects of Internet advertising, companies can
find the right media mix.

o To achieve success in Internet advertising, you ought to have a clear

knowledge of the basics of Internet functioning. Additionally, you should
try to understand that some media can work for you better than others
depending on your type of customers and the products you offer..

o Majority business owners worldwide know that the Internet has now
become an essential tool when it comes to running their businesses
successfully. However, you should also understand the role played by
the Internet in the lives of their customers. You should be capable to
locate people who are using the Internet; their key interests in the time
spent on the Internet and their preferences to purchase products and
services on a daily basis.

o Business owners now have got various ways and websites to advertise
about their company and offered products and services.
Exchange4Media is a leading company that supports and specialises in
providing services related to Internet advertising.

• On-line advertising paradigms

Two different advertising paradigms are emerging in the on-line world, they are:
Active or push-based advertising Passive
or pull-based advertising
a)Active or push-based advertising
Active or push-based advertising is of two types they are:

• The broadcast model: Broadcasting message provides a means for

reaching a great number of people in short period of time.

• The junk mail model: Disadvantage of the direct mail include relatively
high cost per contact. Junk mail is the just poorly targeted direct mail. It is
most intrusive of all forms of internet advertising, because it is easily
implemented using electronic mail.
b)Passive or pull-based advertising

• Pull-based advertising provide a feedback loop, company and customers.

On-line pull-based advertising includes the following:
• The billboards or www model: Billboard advertising is often used to
remind the customer of the advertising messages communicated through
other media.
• Catalog and yellow pages directory model: Traditionally, the most
visible directory service of advertising is the yellow pages. Catalog model is
the least intrusive model but requires active search on the part of customer.
• Customer endorsement model: In endorsements people tell their
experiences with products and services. These are in question and answer
format.

• Types of Online-Advertisements

– Floating ad: An ad which moves across the user's screen or floats

above the document

– Expanding ad: An ad which changes size and which may alter the
contents of the web page

– Polite ad: A method by which a large ad will be downloaded in

smaller pieces to minimize the disruption of the content being
viewed
 – Wallpaper ad: An ad which changes the background of the page
being viewed

– Trick banner: A banner ad that looks like a dialog box with buttons.

– Pop-up: A new window which opens in front of the current one,

displaying an advertisement, or entire webpage

– Pop-under: Similar to a Pop-Up except that the window is loaded or

sent behind the current window so that the user does not see it
until they close one or more active windows – Types of Online-
Advertisements

– Video ad: similar to a banner ad, except that instead of a static or

animated image, actual moving video clips are displayed.

– Map ad: text or graphics linked from, and appearing in or over, a

location on an electronic map such as on Google maps
– Mobile ad: an SMS text or multi-media message sent to a cell
phone.

– Superstitial: An animated adv on a Web page.

– Interstitial ad: a full-page ad that appears before a user reaches

their original destination.

• Guidelines for Internet Advertising

1. Do not send intrusive messages. Do not send messages that people would
not like to receive
2. Do not sell consumer data without the express permission of the user
3. Advertising should appear only in designated news groups and list servers
4. Conduct promotions and direct selling only under full disclosure.
5. Marketers should be free to offer promotions on the network
6. Conduct research only with the consumer’s informed consent
7. Never use Internet communications software to conceal activities
• On-line Marketing Process
• The goals of marketing may remain the same, but in electronic commerce
they must adapt to new means.

• It includes creating a marketing plan, distributing an advertisement and

interacting with customers in a clear step-by-step manner.

• Creating a successful marketing plan that fulfills expectations under the

given financial, time and human resource constraints are a monumental
task.

• Early Internet marketing efforts were oriented toward technology and

consequently emphasized the product and its associated information.

• In recent years there has been a shift in Internet marketing from only
complex to more commodity-like items.

• This has resulted in the emphasis shifting from the product focus to the
marketing process of reaching and getting close to the customer.
• However, in the nascent world of electronic commerce, traditions and
norms are few and far between, and the basic issues are just beginning to
be addressed. A totally new approach is required to address the
fundamental marketing issues that need to be resolved for success in the
electronic marketplace.

• six-step interactive marketing process

Step 1: Segment and identify the audience
Step 2: Create a coherent advertising plan
Step 3: Get the content to the customer
Step 4: Correspond and interact with customers
Step 5: Learn from customers
Step 6: Provide customer service and support

• Market Research
 o Market research is an important tool for any organization seeking a
commercial opportunity, particularly for small firms looking to grow
their business. From discovering a gap in the market to ensuring
customer satisfaction and planning effective marketing campaigns,
research can provide the market intelligence needed to encourage
success, enhance competitiveness and maximize profits.
o On the positive side, the growth of online technology has enabled
researchers to offer clients a fast and cost-effective method for
reaching their target audiences.

Advantages
There are a number of benefits to commissioning online research,
including:
• large numbers of respondents can be researched at one time
• international boundaries no longer need to be an obstacle to research –
worldwide research can be conducted at the click of a button
• it can be an inexpensive way to conduct large research projects - it is
possible to get thousands of responses for just a few thousand pounds
• Pre-screened panels. Most large research suppliers have access panels
which provide an easily accessible, reliable respondent base which can
respond promptly to online questionnaires
• It allows for a very rapid turnaround – research can be undertaken and
results received within a few days. Many research suppliers now offer
same-day delivery of results
For a business which needs to gain a general view from a large cross-
section of the population, and in as short a time as possible, there is no
doubt that online research offers a viable benefit.