Posing New Challenges

The shift of commerce from the physical

world to the virtual world will force companies to get in sync with

ecommerce or left behind by tomorrow’s business.

Electronic commerce (EC) is the use

of computer net-works–the internet, intranets, extranets and private

networks–to complete business transactions, Prior to 1997, web-based

EC still was in an embryonic stage. There was uncertainty about

which products and services should be used to develop commerce sites,

to provide web-enabled content such as advertising or publishing,

or to support business activities such as sales or customer service.

EC was identified mainly with electronic data interchange (EDI)–an

older, less-flexible technology that seemed out of step with the

new ways of doing business electronically via the internet.

In 1998, the concept of EC has begun

to crystallize in the thinking of most business people. EC-enabling

tools and technologies–for example, products and services for site

development and operations–are recognized as a multi-billion-dollar

industry in their own right. Perhaps more important, EC now is understood

to include the customer interactions of advertising, product selection,

contract negotiation, and so on–all the way through to the product

and services delivery phase, including logistics, payment, settlement

and clearance. As the scope of EC’s definition has expanded, the

technologies that support EC have expanded as well. The term electronic

business has been introduced, which includes not only EC but all

web-enabled core business processes, extensive customer integration

and connectivity, and strategic transformation of business processes

to exploit the efficiencies these technologies make possible.

Due to differences in the markets involved,

vendors have outlined their capabilities in two categories.

• Business-to-Business EC–The use
  
  of private networks or the internet to automate business transactions
  
  between companies.
• Business-to-Consumer EC–The use
  
  of the internet to sell merchandise or provide services to customers
  
  in much the same way as a store or a catalog at the level of the
  
  underlying technologies, the differences in these categories are
  
  less apparent; for example, Microsoft’s Site Server Commerce Edition
  
  and Open Market's OM-Transact 4 have features that apply to both
  
  categories. In fact, many of the business-to-business tools grew
  
  out of those developed initially for the business-to-consumer
  
  market. Vendors such as iCat and Open Market, for example, are
  
  beginning to move aggressively into the business-to-business side
  
  of EC as well.

Many of the advertising supported

websites providing online information and web versions of print

publications do not distinguish clearly between ‘business’ and ‘consumer’

audiences; consequently, advertisements may be targeted at business

purchases even if the content is aimed at individuals. On the other

hand, a significant number of websites, especially in financial

services are aimed not at selling new goods or services but at providing

customer service and transactional capabilities to existing customers.

To succeed, commerce sites targeting

consumers need to offer convenience, control and selection while

saving both time and money. Business users have similar needs, but

other factors may determine a site’s use and success–for example,

contractual terms and conditions, availability or settlement and

fulfillment options.

Business-to-business

EC