1.6 MANAGEMENT INFORMATION SYSTEM

4. Discuss in detail the activities involved in development of e-commerce based
Information System in an organization.

STRATEGIES
One of the first challenges involved in moving to online commerce is how to compete with other e-commerce sites. A common problem in addressing this challenge is that e-commerce is often analyzed from a technical standpoint, not a strategic or marketing perspective. E-commerce provides several technical advantages over off-line commerce. It is much more convenient for the buyer and the seller, as there is no need for face-to-face interaction and Web-based stores are open 24 hours a day. Also, e-commerce purchasing decisions can be made relatively quickly, because a vendor can present all relevant information immediately to the buyer. These factors lend themselves to a transactional approach, where e-commerce is seen as a way to reduce the costs of acquiring a customer and completing a sale.
In contrast, most successful e-commerce Web sites take a relational view of e-commerce. This perspective views an e-commerce transaction as one step among many in building a lasting relationship with the buyer. This approach requires a long-term, holistic view of the e-commerce purchasing experience, so that buyers are attracted by some unique aspect of an e-commerce Web site, and not by convenience. Since consumers can easily switch to a competing Web site, customer loyalty is the most precious asset for an e-commerce site.
BARRIERS TO SUCCESS
Despite the growing number of e-commerce success stories, plenty of e-commerce Web sites do not live up to their potential. There were three primary causes of e-commerce failures during the early 2000s.
First, most Web sites offer a truncated e-commerce model, meaning that they do not give Web users the capability to complete an entire sales cycle from initial inquiry to purchase. As analyzed by Forrester Research, the consumer sales cycle has four stages. First, consumers ask questions about what they want to buy. Second, they collect and compare answers. Third, the user makes a decision about the purchase. If the purchase is made, the fourth phase is order payment and fulfillment (delivery of the goods or services). The problem is that many Web sites do not provide enough information or options for all four phases. For example, a site may provide answers about a product, but not answers to the questions that the consumer has in mind. In other cases, the consumer gets to the point where he or she wants to make a purchase, but is not given an adequate variety of payment options to place the actual order.

SUCCESS FACTORS
This firm identified five critical e-commerce success factors: 1. Support customer self-service. If they so desire, Web users should be enabled to complete transactions without assistance. 2. Nurture customer relationships. Up-front efforts should focus on increasing customer loyalty, not necessarily on maximizing sales. 3. Streamline customer-driven processes. Firms should use Web technology to reengineer back-office processes as they are integrated with e-commerce systems. 4. Target a market of one. Each customer should be treated as an individual market, and personalization technology should be employed to tailor all services and content to the unique needs of each customer. 5. Build communities of interest. A company should make its e-commerce Web site a destination that customers look forward to visiting, not simply a resource people use because they have to conduct a transaction.
A quick review of Amazon.com bookstore site illustrate how many of these principles combine to help develop a strategic e-commerce capability.
Amazon.com, which has one of the highest sales volumes of any Web-based business, has optimized its site for the nature of its products and the preferences of its customers. The site is highly personalized; each visitor to the site, once registered, is greeted by name. The site content also is customized. Using software based on pattern recognition, Amazon.com compares a particular customer's purchase history to its overall record of transactions and generates a list of recommended books that seem to fit his or her interests and tastes. The company has a very integrated customer service support system, so that any customer service representative can access all data on the transactions, purchasing information, and security measures of each customer. The system also supports communications using e-mail, fax, and telephone.
Finally, Amazon.com helps to build a community of users through its Associates Program. Under this program, a Web site can host a hyperlink directly to the Amazon.com site. Any time that a visitor to that site buys books through Amazon.com, the Web site owner receives a share of the transaction revenues. This is a very inexpensive way for Amazon.com to extend its marketing and advertising reach across the Web.
These cases and analyses reflect some common lessons learned about the right way to approach electronic commerce: 1. First, no company can be successful in e-commerce by itself. Oftentimes, a firm must integrate its Web site with those of its trading partners, including suppliers, customers, and sometimes even competitors. Thus, each firm must create its own "value Web" that delivers the maximum benefit to its customers. 2. Second, site content is as important as product quality for firms engaging in e-commerce. A visit to an e-commerce site should create a lasting experience and strengthen a company's relationship with the customer. This involves much more than simply discussing the advantages of a company's products and services. 3. Third, firms must take advantage of all opportunities to use e-commerce for reengineering systems outside of the Web. One interesting consequence of this is that increased automation of business processes increases the value of human contact. If customers are used to completing transactions without human intervention, rapid and personal assistance during a problem will be much more memorable and valuable. 4. Finally, personalization is becoming an expectation of Web users. This does not mean that each Web site should be all things to all people. Instead of designing a Web site that appeals to a generic customer or a broad demographic segment, firms should create dynamic content that can target itself to match the tastes of each visitor separately. This maximizes the opportunity to use each Web visit to build the relationship with a particular customer, even if that visit does not result in a sale.
Electronic commerce, as used by U.S. firms, has already undergone several generations of evolution. Early experiences helped to stabilize e-commerce technology and set the development path for more sophisticated and useful technologies. Later experiences provided guidelines on strategic approaches and operational models that will help to improve e-commerce success.
There are two other key areas where more progress is needed to ensure the healthy growth of e-commerce. First, the emergence of the so-called digital economy is dependent on the creation of a robust infrastructure for all e-commerce, which in turn requires the development of standards. Second, government policy is having an increasing impact on e-commerce activities, and therefore policy needs to begin to catch up with the latest technology. Some of the policy issues that governments must address in regulating e-commerce, as identified by the U.S. government, are: 1. Financial issues, including customs and taxation, as well as electronic payment systems. 2. Legal issues, including the uniform commercial code for electronic commerce, intellectual property protection, privacy, and security. 3. Market access issues, including telecommunications infrastructure and interoperability, content, and technical standards.
Three key issues will determine the long-term viability of electronic commerce. These are: 1. Technological feasibility, or the extent to which technology—bandwidth availability and information reliability, tractability, and security—will be able to sustain exponentially increasing demands worldwide. 2. Socio-cultural acceptability, or the extent to which different global cultures and ways of doing business will accommodate this new mode of transacting, in terms of its nature (not face-to-face), speed, asynchronicity, and unidimensionality. 3. Business profitability, or the extent to which this way of doing business will allow for profit margins to exist at all (e.g., no intermediaries, instant access to sellers, global reach of buyers).

Business Model
An e-commerce business model is the macro or micro environment in which a company provides products and services to customers. A resource based view (RBV) model was used to examine the relationships of e-commerce information system resources, supply chain process integration, and business value (Ghobakhloo, Sabouri, Hong, & Amirizadeh, 2011, p. 344). As stated by Ghobakhloo et. al., (2011), “A questionnaire-based survey was conducted to collect data from 214 supply chain, logistics, or procurement/purchasing managers of leading manufacturing firms” (p. 344). Technological innovation is essential for supply chain process integration. Senior managers can use this information to develop marketing analysis to target customers in other markets. Michael Porter model provides insight on five factors that influence industry performance as follows: “rivalry, threat of substitutes, buyer power, supplier power, threat of new entrants, and supplier power” (Porter, n. d., p. 1). The executive management team must adjust corporate, business unit, and departmental strategies to compete in the global market (Porter, n.d., p. 9).
Business Strategy
E-business strategy should be incorporated in business/IT development initiatives to generate revenue through business-to consumer (B2C) and business-to business (B2B) on-line transactions. The four attributes of knowledge management systems software is “to enhance the organizational processes of knowledge creation, storage/retrieval, transfer, and application” (Alavi & Leidner, 2001, p. 114). For example, Windows operating system, Oracle database systems, Mobile devices (laptop, Blackberry, and iPhone) telecommunication software, and McAfee security software. Application software supports functions and processes in the organization such as accounting, human resources, and marketing. For example, ERP packages such as Oracle, PeopleSoft and SAP. The following Microsoft applications are used to enhance productivity in the work environment Excel spreadsheets, Word business documentation, PowerPoint for presentations, Access for database entry, MS Outlook email and calendar, MS Project for IT projects, and MS Visio for business process and systems mapping.
Supply Chain Management
In the article Lorchirachoonkul and Mo (2010) discuss a virtual radio frequency identification (RFID) framework for a supply chain organization. The android and iPhone wireless communication devices have application interfaces, internet access, Wi-Fi, Bluetooth, camera, GPS, and data storage (Lorchirachoonkul & Mo, 2010, p. 921). Quick response (QR) code is embedded in RFID tags for organizational marketing material and professional business cards. RFID is a twenty-first century advanced technology used by multinational retailers such as HP and Wal-Mart (Mehrjerdi, 2010, pp. 107-108). Arnold and Bures, 2003(cited by Mehrjerdi, 2010), “Have pointed out the RFID can bring numerous benefits for retailers that include: an improved sales floor, planning for desired styles, sizes and colors, and better customer services by sales staff on the floor spending more time with customers and less time with the stock” (p. 110). A primary benefit of RFID technology is it can reduce cost and improve business operations in the supply chain.
Managerial roles
The business and IT balanced scoreboard enables executive management teams to oversee the corporations’ internal controls (Grembergen, 2003, p. 2). This article discusses seven essential skills needed as a twenty first century leader in technology. The author use data from Cutter Consortium to obtain an understanding of business models and key processes prior to implementing technology. Senior management focuses on strategic and operational technology to align business and IT initiatives such as “ERP, CRM, B2B Commerce, Wireless Communication, and Security Services” (Andriole, 2007, p. 69). The executive management team can use a dashboard or scorecard to assess the risk of its IT environment.
The changing world of work
Systems theory can be applied by management in various industries to integrate personnel, core business process, and technology. Jennex (2005) conducted a qualitative case study to examine end-user computing systems at an engineering company. The purpose of the study was to identify redundant workflow processes in IT, document assets, and reduce technology cost. RFID technology enable executive management and managers to have access to data in real-time based on the following properties: “embedded code, tags are reprogrammable, capable of working in various environments, improves antitheft protection, inventory management, tracks work in progress, and reduce human errors’ (Mehrjerdi, 201, p. 108). It is the responsibility of senior management to implement a logical security policy, software development lifecycle methodology, as well as change management policy/procedures for ERP systems, application interfaces, databases, and networks. End-users should be encouraged to share ideas or feedback on the functional design of technology initiatives, test business applications, and receive training.

Conclusion
The purpose of this paper is to provide an analysis on the impact of Electronic commerce (e-commerce) information systems on business process design, managerial roles, and the changing world of work. Business processes are focused on the customer, market, and improving products/services. The CEO and steering committee rely on this information to make decisions about selecting IT projects for the organization. The United States of America and Europe have increased offshore business process outsourcing (BPO) of business and IT functions (Kim, 2008, p. 813). In the new economy senior management should select vendors with hybrid governance expertise. IT leaders of the twenty-first century must stay abreast with technological innovations to create products, scan the market for changes, and have an adaptable business model.
Quick response (QR) code is embedded in RFID tags for organizational marketing material and professional business cards. RFID is a twenty-first century advanced technology used by multinational retailers such as HP and Wal-Mart (Mehrjerdi, 2010, pp. 107-108). A primary benefit of RFID technology is it can reduce cost and improve business operations in the supply chain. The executive management team can use a dashboard or scorecard to assess the risk of its IT environment.