1
Running head: E-COMMERCE
18
E-COMMERCE
Business skills for E-commerce
Name
Professor
Institution
Course
Date
Contents
Introduction 2
Overview 3
Discussion 4
Assessment of the Organization 4
Structure of the organization and the industry 5
Impact of the E-commerce 8
Discussion 9
Market Analysis 9
Customer Research 10
Markets Research 11
E-Commerce Competitor Analysis 11
Risks and Financial challenge in E-commerce 12
Design for the Proposed e-Commerce Solution 13
Technological requirement 13
Payment mode 14
Security Measures 14
Legislation 15
Evaluation of the Proposal 15
References 17
Introduction
In our contemporary world, most of the organization are embracing the idea of competition so as to be able to reach the required number, and also the level that is required for the firm to be competitive in the market by providing the best services and destination for all the client across the globe. To achieve this, they have to adopt and incorporate the practice of E-commerce in their daily operations. Organizations of all sizes, structures and various aims have brought different benefits and opportunities in that there are the intelligent applications of communications that is based on the modern technologies. All this make it possible and always to be having specialists who clearly and comprehensively understand these technologies. E-commerce has become an important component of all the organization’s capability as they try to spread out to the various target market and segment so that they can position themselves with the aim to maximize the positive commercial returns on the investment.
In some instances, when there are poor choices of technology in an organization and also the process, this will result in poorly managed opportunities that could lead to the loss in the organization as it goes losing business, its market position and being profitability. The stakeholders of the business will assess and investigate all the values of the business skills by taking into consideration the current, and the topical examples of the e-commerce practices. Secondly, stakeholders will also look on how to design the e-commerce solutions based on the best advantage that it has to the organization and its stakeholders. Lastly, the management will also be concerned about the exploration of the current legislation that is concerned with the e-commerce based trading, the organizational responsibilities, and the finances or the payment systems.
Overview
In our case study, as an IT company that is specializing in the development of the computerized business systems, we will come up with a proposal design that will enable the client firm to overcome the hurdle of competing in the competitive internet based stores as he is seeking to be offering a wide range of products. Our main aim will be to adopt the practice of e-commerce for our client has they have currently sought to install the usage of e-commerce to be able to complement their current business strategies. One thing that was evident when we analyzed the client’s company was that they make wide usage of the internet but the only huddle was that they do not the technical-know-how background on how to apply the practice of e-commerce by incorporating it into their system currently. This put them in a scenario where they are not in a position to know the implications for this growth in their organizations. Our expertise in the IT sector will come in handy to design and develop the best-computerized business systems for Nova Cosmetics that will enable them to have a new approach on how they deal with their client. As evidenced, current the company takes order from its client using a phone so as to make order from their catalog. For this to be a success, the firm has to pay a local firm to create for Nova a catalog but the management deem it possible to have the ability to create their catalogue using the data that is held in their database rather than rely on the external client. Also the client firm, Nova cosmetics want to diversify by adding additional retail chemist to their information system, and all this will be made possible by implementing the proposal that we shall draw for the client. By so doing we will consider the structures and the aims of a company so as to understand better in what way they can help or benefit from the e-commerce structure. Secondly, there will be an opportunity to investigate and evaluate all the impact of the e-commerce systems to a company and its various stakeholders. Therefore, we will be in a position to examine the whole process of development of the e-commerce existence surveyed by the various opportunities that are designed to aid an e-commerce system (Fang, 2014. Pg. 467).
Discussion
Assessment of the Organization
Nova Cosmetics being a company that specializes in the purchases of the product in large quantities form both the manufactures and the supplies, in the pursuit of the e-commerce practices, the main aim of this organization include: the new system will seek to implement three main objectives, 1) the first one is that of the production process, as we have already seen Nova Cosmetics relies on the external client to design for them a catalogue that will be able to be accessed by the clients but the new system will seek to include the process of procurement, ordering and replenishment of the firm’s stock using its catalogue that has been designed using the data that is available in their database. This will provide electronic links to their external clients and supplies as it will be able to process payment. Also there will be production control process that will be incorporated in the new e-commerce system among other initiatives.
The second aim of this organization is to come up with a customer-focused processes that will be able to take into consideration both the promotional and the marketing component of the business. This will enable making orders over the internet for the client, processing of the clients’ purchases orders and also the payment, and lastly setting up the customer support.
The last aim of this cosmetics organization is that of internal management processes that encompass employee services, training them and internal information sharing system, the video-conferencing and recruitment. E-commerce will come in hand in the application of the electronic applications that enhances information flow among the production department and the sales department so as to improve the sales forces of production (BTEC, 2011. Pg. 183).
All these activities and practices will be geared toward the usage of ICT so as to enhance one’s business. This takes into consideration all the practices that an organization considers in the field of computer-mediated network. As we are aware, the practices of e-commerce are that it is involved in the transformation of the organizational processes that are aimed at delivering additional customer value over the client application of technologies, the philosophies and also the computing model for the new economy.
Structure of the organization and the industry
Our client customer has a good network base, so the only thing that is needed is the upgrade of the structure so as to accommodate the e-commerce practices within the organization. To achieve these, the firm has been suggested to come up with two pillars that will offer extensive support to the e-commerce applications and the infrastructure within the organization. 1) public policy that will be tasked with the issues such as Universal access, the privacy and the information pricing for the organization using the existing information from their database. 2) Technical standards that are aimed at dictating the nature of the information that is being channeled to the stakeholders, the user interface and the transport taking in the interest of the compatibility transversely the whole network (Popescu, 2015. Pg. 358).
The major changes that will be introduced within the existing infrastructure for the Nova Cosmetics is that; all the common business services that are aimed at facilitating the selling and buying process, secondly we have the messaging and the information distribution that will act as a means for either sending or retrieving the information within the database systems. The new system will incorporate multimedia content, and the network systems channels that will create a product and also a means so as to communicate with it, this will come in handy for the Nova Cosmetics as it diversifies within the industry and seeks to break its external dependence for the catalog development. Lastly, the new organizational system will incorporate the I-Way foundation that will provide a highway system along with the channel that all the E-commerce must travel.
Analyzing the industry infrastructure in general as far as the ICT system is considered, the Nova cosmetics is located within the industry that is very competitive and also dynamics. Most of the competitors have moved away from the analog way of operations and adopted the modern IT infrastructure such as the E-commerce. This industry encompasses manufacturers, the distributors, the retailers and wholesalers as well as the supplies where Nova fall as an ingredients and services provider. In our country, this industry covers an estimate of 80% with the remaining part occupied by the product from foreign countries such as China and Japan. In our country, the cosmetics industry is worthy $8, 438 million as at the end of 2015 as it had spread its wing in the Asia and Europe markets. It is estimated that by the end of 2016 the country cosmetic industry $72 billion that are valued at the retail price, this represent a one-third of the global markets which is the best margin as compared to another big market such as Japanese. Lastly, the industry has seen the growth of small-scale firms that are operating within the country’s cosmetics industry (Popescu, 2015. Pg. 358).
One of the major influence in the infrastructure of the industry is that there had been an emergence of the IT usage for the last decade that has accelerated both the E-commerce and other features greatly within the industry. This is the key for firms such as Nova cosmetics that are seeking to become more digitalized by incorporating the new practices within its system such as E-commerce. The incorporation of the e-commerce will have positive effects for the new potential markets has it will enable them to place their order via the internet at the location of their convenience as compared to the current tedious and inefficient system of the telephone call that is prone to misunderstanding. E-commerce will enable the company to diversify into the new potential markets with ease as the operation cost will have been reduced so as to be able to break even the returns. As we had seen, Nova cosmetics is in the process of diversifying into new markets by opening the new outlet both locally and oversees, this will be achieved with ease has the firm embrace the practice of E-commerce. The recent channels that are used for distribution are analog but by the introduction of e-commerce there will be an easy flow of the goods from the Nova stores immediately the clients places an order. The company employs the FIFO method to supply its products, and this can be fed into its system that will keep the record of the orders placed and how they are flowing in and out. This will be in line with the new set objectives and the installed structure within the Nova Cosmetics Inc.
Impact of the E-commerce
As we have already highlighted, e-commerce is gaining a lot of popularity all over the globe because all the organization activities with its stakeholders are done through this practice. For the case study of the Nova Cosmetics, the proposed move to start using e-commerce will have profound effects on the way it does its business and more so the handling of the clients. E-commerce will be at the fore-front in enhancing the product reputation for the various organization. This practice is will also make life easier and more comfortable for the Nova Cosmetics has by incorporating the e-commerce practices in their operations. Also, it is able for the client to choose online without the need to go to the market. The practicing of the e-commerce become so prominent in the late 90’s for the developed countries and in the year 2005, it had picked almost in all areas across the globe. Some of the impact the practice of the E-commerce has brought for the Nova organizations are such as it has contributed greatly to the widening of the digital divide; this typically means that the facility that encompasses e-commerce are mostly enjoyed by the folk in the urban areas. As we all know, for the case of e-commerce all the business that is conducted requires individual to have internet connectivity and also computer literacy, if these requirements is not available then it renders the e-commerce practices not implementable by the organization. These factors make it that most of the client for the e-commerce are found in the urban areas and in rare cases where they are located in remote areas the place is having internet accessibility by the few people who are computer literate. As it in our case study, all the retail branches that are going to be opened by the Nova in its bid to diversify will be concentrating on the areas that are well served by the internet so as to make the practice of e-commerce success.
Another impact that has been brought about by the e-commerce practice is the threat emanating from the information warfare. As for the case of Nova Cosmetics, there are so many competitors who have embraced the usage of IT features and therefore adopting the E-commerce practice will make the firm better placed so as to compete favorably in a competitive industry of cosmetics. This takes into consideration factors such as copyrights and patents rights, or either the information licking and the virus attacking the e-commerce facilities maybe from the malpractice individuals or mechanical failures. We have the encouragement of monopoly by the e-commerce practices. This is whereby the government involvement creates a monopolistic market scenario. The other impact that Nova Cosmetics stand to reap from the practice of E-commerce is the reduction of the transaction cost as the introduction of the order placement via the internet will reduce the cost that used to be incurred over the telephone calls. Also, the taskforce that is required will have been cut as there is no much workforce when it comes to the e-commerce transactions. This can be understood when a business takes up a physical marketplace and replace it with the internet based one. This will have the impact on reducing the coordinating cost and the in the process end up increasing efficiency. This cost that are reduced range from the process improvements, the market-place benefits and also the accountable indirect improvements.
Discussion
Market Analysis
In our contemporary business world, it is important for any organization despite its industry status to have the know-how of its market and how it operate, the clients base and their wants as this is the core factors that drives the firms towards being successful, precisely being profitable and maximizing the wealth of its shareholders. In our case study, our proposal to the client company Nova Cosmetics will involve expounding on the set objectives and the market analysis. This initiative is good as it focuses on the analysis and the customer research that will help the Nova Cosmetics to focus on their efforts and on how to maintain a competitive edge within the industry. To implement the market analysis, our team advised the company to have a market strategy that will have to look into the potential of the target markets so as to determine whether the markets is worthy investing in. second, the assessment will be to have the know-how of how the markets work, its main distribution channels and the current trends in the market. In the analysis of the market, it is important to understand what the client want and their behavior pattern. The selected team will rely on the available statistics in the industry concerned with the identification of the trends that has been exhibited by the client for the last five years. Some of the data that will be looked upon are the market size, its composition regarding age, status and demographic, so as to have a fully budget that will be enough to roll the whole plan into action once the assessment is complete. The team also will carry out customer research and the industry analysis so as to investigate all the factors that have an influence on the client’s purchasing power. It will also be worth to analyze or carry out research that will show what the competitors are doing as this will help our client firm Nova industry the best opportunities and also how to carry out differentiating their product and the services so has to fill these gaps. The market research that will be conducted will help in establishing the best sales and the communication channels to reach the target audience (Laudon & Traver, 2015. Pg. 291).
Customer Research
First of all, it is good to identify the markets niche for our client company whether it will be defined by the geographical area or by the demographic factors of a place. The team will also be tasked to conduct market intelligence so as to be able to identify different opportunities that are untapped within the market, and also to have the know-how of the trend in the industry that will help in the implementation of the E-commerce by the Nova Cosmetics and also to identify the markets segments that can be targeted. Once the Nova Cosmetics has identified its market target, then the research that had been conducted earlier will help to identify all the potential clients and the best way to approach them.
Markets Research
In our case study, our client Nova Cosmetics will have to research and come up with the markets reports when carrying out market analysis. These can be developed using a current document that is elaborating more on the issue of IT and E-commerce such as trade media, the networking process and also from the client feedback once the system is fully in operation. These sources will prove to be in handy as far as the issue of implementing the new practice of E-commerce is concerned whereby it will keep the firm updated of the changing trends or the investing opportunities within the markets. The other thing is that all these market reports will need a careful interpretation so has to be helpful to the users. Time to time evaluation of the market will be required whereby the practice of the E-commerce will be evaluated so as to have a positive impact on the needs of the clients that are changing continuously.
E-Commerce Competitor Analysis
As far as our case study is concerned, our client Nova Cosmetics will face many competitors as more business in the industry are adopting the practice of E-commerce on their operations, because of this we have to do an E-commerce Competitor Analysis in order to be better placed on how to reach our target clients with ease in the congested industry of cosmetics that is seen the rampant cases of cut-throat competition. This will enable the development of the scientific classification framework that permits all the comparison among the e-commerce web sites in relations to the “competitive advantage.” By carrying out this comparative classification, it would enable Nova Cosmetics specifically its computing audience, to have the evaluation of the competitive edge of the e-commerce over its director competitors. This comparative framework will be designed in a way that it will enable our client company to possess the ability that can be used and applicable in the suitable comparative manner for all the target markets and the industry. Additionally, much of the detail of the framework is focused on the measures that have greatly contributed in adding the value towards the e-commerce competitive position for the Nova Cosmetics as the business that is under the assessment. All these information that has been provided will prove to be useful to all the target market by the Nova Cosmetics in its bid to expand as it cannot be limited to any particular industry, it is also highly objective and unbiased. The implications that are implied here is that the variance in the information that is provided by this framework for the competitor analysis will be small as various assessors use it. All these objective for them to be achieved by the Nova Cosmetics, the selected group of expertise will need to have a field day conducting literature research on the topic of e-commerce about the competitors as it can be assessed in the public business news bulletin. This will be followed by the designing and the refining of the e-commerce framework so to make it useful via the process of the iterations, and the testing of the whole framework in a way that it will be used with confidence (BTEC, 2011. Pg. 183).
Risks and Financial challenge in E-commerce
Despite the enormous benefits that are reaped by an organization when it adopts the practice of e-commerce, there are also numerous risks and financial challenges that are associated with this practice. The term risk refers to the possibility of any adverse outcome and also uncertainty occurring. These forms of risk can either be stemming from either internally or externally to the extent of having a profound impact on the smooth flow of the e-commerce operations in organizations. In our analysis, we are going to analyze various risks that are faced by the Nova Cosmetics in its bid to install e-commerce in its operations. The first challenges that will be encountered are the technologically related features that are mostly derived from the use of IT, the invasion of viruses, and the lack of confidentiality, integrity and lastly the availability of the mechanisms. All these have an adverse effect of impacting on the compatibility, the complexity, and the uncertainty of the e-commerce systems and operations. Apart from this, the Nova Cosmetics Inc. will be faced with the risk of financial challenges that will force them to seek external funds or issue shares so as to be able to raise the required capital. Some of these financial hurdles include high start-up cost for installing the e-commerce applications that will keep on rising as it requires continuous assessment and maintenance. For instance the high cost of connection costs, the software purchase and installation, set-up the whole thing and the maintenance cost. Therefore we propose that our client company, the Nova Cosmetics to come up with an IT department and the risk assessment segment that will be tasked with the close and continuous monitoring of the risk that can arise in the e-commerce systems.
Design for the Proposed e-Commerce Solution
Technological requirement
In the implementation of the proposed design for the client, the following are the technological requirement that will be needed to make the process a success: hardware and software; typically a web server is a hardware device that is in most cases applied to host the e-commerce websites. This is a must like all the HTML files, the database and also the image files will be stored on this website as the main server. The software that will be required is the operating systems that will enables the computers to be functional such as various browsers. It is recommended that Nova cosmetics due to its small nature pay us to maintain the server for them as the hosting client before it can be transferred to them when there IT is fully equipped with the appropriate expertise. Also the department will be tasked to come up with a back-up systems for its data that should be stored in a safer room as a measure of security against malicious people and hackers. The maintenance will be carried by us as the hosting firm, and lastly we are also going to link the main server with the marketing and the production department. This is to make it easy to access the information concerning their supplies and distribution channels for their clients (Fang, 2014. Pg. 467).
Payment mode
All the business transaction that our client will conduct through the online forum, and be specific the e-commerce will require some mode of payment either the client paying its suppliers or the customers paying for their orders upon delivery or during the placement of the order. As the firm will be diversifying to the new markets, it will adopt payment using the PayPal means as they are accessible to all over the globe and also the debit/credit card that facilitates the transactions through local banks for local clients.
Security Measures
As we have already seen, most of the online transaction are prone to malpractices from different sources, for our client, we proposed to them to adopt the following security measures such as install on all the computers firewalls to prevent viruses and identify theft by the malicious people who are after the firm information. Also, the computers should be equipped with the speed booster so as to give the clients a fast experience when placing an order. Also, the IT facilities should be secured with Secure Socket Layer and secure HTTP. All the computers should be equipped with a strong password that is very hard to crack and be kept as a secret. Lastly, the facilities should have security personnel around the clock as these equipment are expensive so prone to theft by robbers (Laudon & Traver, 2015. Pg. 291).
Legislation
Ant business activity has some laws that regulate its implementation, in this case of implementing the e-commerce practices for our client, the Nova Cosmetics Inc. the following Acts should be adhered to: the Data Protection Act 1998, the Computer Misuse Act 1990, the Consumer Credit Act 1974, the Trading Standards, the Freedom of Information Act 2000, copyright legislation.
Evaluation of the Proposal Design
STEPS
EVALUATION QUESTIONS
INDICATE YOUR FEEDBACK
Step 1
Is the overall style and demonstration of the proposal in agreement with that stated by the instructor and also the field of study?
Step 2
Is the title brief, comprehensible and appropriate?
Step 3
Is the contents page clear, being concise and also logically numbered?
Step 4
Is the topic clearly specified and then clearly defined?
Step 5
Has the proposal been specified a clear, and overall purpose?
Step 6
Are the aims and also the objectives (and research questions/hypothesis) clear, relevant and coherent to the topic of discussion?
Step 7
Do the aims, the objectives go beyond mere description or not? Do they include explanation, comparison, criticism or evaluation?
Step 8
Are all the topics that are covered by the proposal clear, logical, readable and complete?
References
BTEC, 2011. Computing & Systems Development Study Guide Level 4HNC Level 5 HND. Pearson
The British Computer Society, http://www1.bcs.org.uk/ • The Institution of Electrical Engineers (IEE), http://www.iee.org.uk
The Institute of Electrical and Electronics Engineers (IEEE) Computer Society, http://www.computer.org
The Association for Computing Machinery (ACM), http://www.acm.org Websites
Popescu, G.H., 2015. E-commerce effects on social sustainability. Economics, Management and Financial Markets, 10(1), p.80.
Laudon, K. and Traver, C., 2015. E-commerce 2015. Pearson Higher Ed.
Fang, Y., Qureshi, I., Sun, H., McCole, P., Ramsey, E. and Lim, K.H., 2014. Trust, Satisfaction, and Online Repurchase Intention: The Moderating Role of Perceived Effectiveness of E-Commerce Institutional Mechanisms. Mis Quarterly, 38(2), pp.407-427.
