Page 32 - Electronic Commerce

Introduction to Electronic Commerce

Internet technologies within the business. All of these communication, control, and
7
transaction-related activities have become an important part of electronic commerce.
Some people include these activities in the B2B category; others refer to them as
underlying or supporting business processes.

Business Processes
For more than 80 years, business researchers have been studying the ways people behave
in businesses. This research has helped managers better understand how workers do their
jobs and what motivates them to work more effectively. The research results have helped
managers, and more recently, the workers themselves, improve job performance and
productivity. An important part of doing these job studies is to learn what activities each
worker performs. In this setting, a business activity is a task performed by a worker in the
course of doing his or her job.
For a much longer time—centuries, in fact—business owners have kept records of
how well their businesses are performing. The formal practice of accounting, or recording
transactions, dates back to the Middle Ages. A transaction is an exchange of value, such as
a purchase, a sale, or the conversion of raw materials into a finished product. By
recording transactions, accountants help business owners keep score and measure how
well they are doing. All transactions involve at least one activity, and some transactions
involve many activities. Not all activities result in measurable (and therefore recordable)
transactions. Thus, a transaction always has one or more activities associated with it, but
an activity might not be related to a transaction.
The group of logical, related, and sequential activities and transactions in which
businesses engage are often collectively referred to as business processes. Transferring
funds, placing orders, sending invoices, and shipping goods to customers are all types of
activities or transactions. For example, the business process of shipping goods to
customers might include a number of activities (or tasks, or transactions), such as
inspecting the goods, packing the goods, negotiating with a freight company to deliver the
goods, creating and printing the shipping documents, loading the goods onto the truck,
and sending payment to the freight company.
One important way that the Web is helping people work more effectively is by
enabling employees of many different kinds of companies to work at home or from other
locations (such as while traveling). In this arrangement, called telecommuting or
telework, the employee logs in to the company network through the Internet instead of
traveling to an office.

Relative Size of Electronic Commerce Elements
Figure 1-1 shows the three main elements of electronic commerce. The figure presents
a rough approximation of the relative sizes of these elements. In terms of dollar volume
and number of transactions, B2B electronic commerce is much greater than B2C
electronic commerce. However, the number of business processes that are conducted
using online technologies is far greater than the number of all B2C and B2B
transactions combined.

Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.