Chapter 3: eBusiness

1. What is an IP Address? What is it’s main function?

IP Address – an Internet Protocol (IP) address is a numerical tag that is assigned to devices in a computer network that uses the Internet Protocol to communicate between nodes (a connection point). There are two main functions of an IP address

1. To network or host interface indentification
2. To locate addressing (two types of addressing; logical and physical).

2. What is Web 2.0, how does it differ from 1.0?

Web 2.0 is a set of economic, social and technological trends that collectively form the basis for the next generation of the Internet, making it more mature, distinctive medium characterised by user participation, openness and network effects. Those who act on the Web 2.0 opportunity stand to gain an early-mover advantage in their markets.

Web 1.0 was created in 1991 and refers to the state of the Wide Web and any website design style used before the Web 2.0.

3. What is Web 3.0?

There have been many debates over how to define Web 3.0, with many people having mixed views on it. A suitable definition is "a highly specialised information silo that is moderated by a cult of personality, validated by the community, and put into context with the inclusion of meta-data through widget." (SOURCE) Web 3.0 encompasses one or more of the following:

> Transforming the web into a database;

> An evolutionary path to artifical intelligence;

> The realisation of semantic web and service-oriented architecture;

> Evolution towards 3D

4. Describe the different methods an organization can use to access information

There are three different methods an organization can use to access information: intranets, extranets and portals.

Intranet – private section of the internet used by companies for internal means. Eg HR forms, finance forms.

Extranet – like an intranet however an extranet you can invite fellow partners along the supply chain (producer to retailer) so you can share data easier between companies.

Portals – web page that combines many systems to appear on the one page. Various systems feeding data into one page. Information should be tailored to the person coming in.

5. What is eBusiness, how does it differ from eCommerce?

eBusiness is the conduct of business on the Internet, not only buying and selling but also servicing customers and collaborating with business partners. One of the first to use the term was IBM, when, in October, 1997, it launched a thematic campaign built around the term. eBusiness differs from eCommerce as eCommerce is the buying and selling of goods over the internet, where as eBusiness contains eCommerce and is the broader term.

6. List and describe the various eBusiness models

Business to Business (B2B) - Applies to businesses buying from and selling to each other over the internet.

Business to Consumer (B2C) - Applies to any business that sells its products or services to consumers over the Internet.

Consumer to Business (C2B) - Applies to any consumer that sells a product or service to a business over the Internet.

Consumer to Consumer (C2C) - Applies to sites primarily offering goods and services to assist consumers interacting with each other over the internet.

7. List 3 metrics would use if you were hired to assess the effectiveness and the efficiency of an eBusiness web site?

Three metrics that can assess the effectiveness and the efficiency of an eBusiness web site is number of page views, types of visitors and how long people spend on a site.

8. Outline 2 opportunities and 2 challenges faced by companies doing business online

Two opportunities are: 1) Your operation has gone from being open from 9am - 5pm, 5 days a week to being open 24 hours a day, 7 days a week. Not only is it open 24/7, It is also available to people world wide, not just in the area where your shop is located. 2) Your business can still operate even when no one is there, and you can save money on shop keeping expenses, such as wages and rent.

Two challenges face are: 1) Protecting your customers security. With people purchasing online, credit card details and passwords are used in nearly every transaction. Trying to keep these passwords and numbers safe can be very complicated. 2) It is very hard for the customer to return the goods if not satisfied, which is very easy to do if there is a physical shop. There can also be mix ups with currency, languages and taxation laws.

Chapter 2: Stategic Decision Making

1. Define TPS & DSS, and explain how an organisation can use these systems to make decisions and gain competitive advantages.

TPS - Transaction Processing Systems is a type of information system that collects, stores, modifies and retrieves the data transactions of an enterprise. The success of enterprises depend on the reliable processing of transactions to ensure that customer orders are met on time, that they can make payment and that partners and suppliers are paid.

DDS - Decision Support System is a class of information systems that support business and organizational decision-making activities. A properly designed decision support system is an interactive software-based system intended to help decision makers compile useful information from a combination of raw data, personal knowledge, documents, or business models to identity and solve problems and make decisions.

2. Describe the three quantitative models typically used by decision support systems.

Three quantitative models often used by DDS include:

1. Sensitivity analysis – study of the impact that changes in one (or more) parts of the model have on other parts of the model. Users change the value of one variable repeatedly and observe the resulting changes in other variables.

2. What-if analysis - checks the impact of a change in an assumption on the proposed solution.

3. Goal-seeking analysis - finds the inputs necessary to achieve a goal such as a desired level of output.

3. Describe a business processes and their importance to an organisation.

A business process is a standardised set of activities that accomplish a specific task, such as processing a customers order. Business processes transform a set of inputs into a set of outputs for another person or process by using peoples and tools.

4. Compare business process improvement and business process re-engineering.

Business Process Improvement - is paramount in order to stay competitive in today’s electronic marketplace. Organisations must improve their business processes because customers are demanding better products and services. Business process improvement attempts to understand and measure the current process and make performance improvements accordingly.

Business Process Re-engineering - the analysis and redesign of workflow within and between enterprises. BPR relies on a different school of thought than business process improvement. In the extreme, BPR assumes that the current process is irrelevant, does not work, or is broken and must be overhauled from scratch. Such a clean slate enables business process designers to disassociate themselves from today’s process and focus on a new process.

5. Describe the importance of business process modelling (or mapping) and business process models.

Business Process Modelling (or mapping) - is the activity of creating a detailed flowchart or process map of a work process, showing its inputs, tasks and activities in a structured sequence.

Business Process Model - is a graphic description of a process, showing the sequence of process tasks, which is developed for a specific purpose and from a selected viewpoint. A set of one or more process models details the many functions of a system or subject area with graphics and text. The purpose of a process model is to:

>Expose process detail gradually and in a controlled manner;

>Encourage conciseness and accuracy in describing the process model

>Focus attention on the process model interfaces;

>Provide a powerful process analysis and consistent design vocabulary.

Chapter 1: Information Systems in Business

1. Explain information technology’s role in business and describe how you measure success?
IT - A field concerned with the use of technology in managing and processing information. IT is important in creating and managing the innovation and success of a company.

2. List and describe each of the forces in Porter’s Five Forces Model.
- Buyer Power - high when buyers have many choices of whom to buy from and low when their choices are few. One way to reduce buyer power is through loyalty programs. These reward customers based on the amount of business they do with a particular organisation.
- Supplier Power - high when one supplier has a concentrated power over an industry. Buyers have few choices of whom to buy from and low when their choices are many. All parties involved in the procurement of a product or raw material are links in the supply chain. The power is often with the supplier.
- Threat of substitute products or services - High when there are many alternatives to a product or services and low when there are few alternatives.
- Threat of new entrants - High when it is easy for new competitors to enter a market and low when there are significant entry barriers. An entry barrier is a product or service that customers have come to expect and must be offered to compete and survive.
- Rivalry among existing competitors - High when competition is fierce in a market and low when competition is more complacent.

3. Compare Porter’s three generic strategies.
- Broad cost leadership - the low cost producer in a business for a given level of quality. Companies sell their products either at an average industry price or a below average industry price. Firms can acquire cost advantage through a number of ways, some being gaining access to a large source of lower cost materials or by improving process efficiencies.
- Broad differentiation - calls for the development of a product or service that offers unique attributes that are valued by customers and that customers perceive to be better than or different from the products of the competition. Firms that succeed in a differentiation strategy have some of the following strengths: highly creative and skilled development team, access to leading research and a strong sales team that can successfully communicate.
- Focused strategy - concentrates on a narrow sector and within that sector attempts to achieve either a cost advantage or a differentiation. It works on the belief that the needs of a group can be better serviced by focusing entirely on it.

4. Describe the relationship between business processes and value chains.
Once an organisation chooses its strategy, it can use tools such as the value chain analysis to determine the success or failure of its chosen strategy. Value creation is the result of effective business processes and efficient values chains. Business process is a standardised set of activities that accomplish a specific task. Value chains view an organisation as a series of processes, each of which adds value to the product or service.