Ecommerce

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SYLLABUS
UNIT-1:Introduction,ElectronicCommerce Framework,the Anatomyof E-Commerceapplications,E-Commerce
Consumerapplications,E-Commerce organizationapplications.
UNIT-2: ConsumerOrientedApplications,mercantile processmodels,mercantile modelsfromthe
consumer’sperspective,Mercantilefromthe merchant’sperspective.
UNIT-3: Typesof ElectronicPaymentSystems,Digital Token-BasedElectronicPayment
Systems,SmartCards& ElectronicPaymentSystems,CreditCard- BasedElectronicPaymentSystems,Risk&
ElectronicPaymentSystems,DesigningElectronicPaymentSystems.
UNIT-4: ElectronicDataInterchange,EDIApplicationsinBusiness,EDIimplementation,MIME,and value
addednetworks.
UNIT-5: IntraorganizationalE-Commerce,Macroforcesand Internal Commerce,Workflow
automationandCoordination,CustomizationandInternal Commerce,SupplyChain
Management(SCM).
UNIT-6:Makinga businesscase fora DocumentLibrary,Digital documenttypes,Corporate
Data warehouses,AdvertisingandMarketing,the new age of InformationBasedMarketing,Advertisingon
Internet,chartingthe Online marketingprocess,MarketResearch.
UNIT-7: Consumer SearchandResource Discovery,informationsearchandRetrieval,Electroniccommerce
catalogsor directories,InformationFiltering.
UNIT-8: MultimediaandDigital video,KeyMultimediaconcepts,Digital Video&ElectronicCommerce,Desktop
VideoProcessing,DesktopVideoConferencing.
Text Books: 1.Frontiersof electroniccommerce – Kalakota,Whinston,Pearson
2. E-Commerce,S.Jaiswal–Galgotia

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Unit- I
1. Introduction:
• It isa general conceptcoveringanyformof businesstransactionorinformationexchange executedusing
informationandcommunicationtechnologies(ICT’s)
• It includeselectronictradingof goods,servicesandelectronicmaterial.
• It takesplace betweencompanies,betweencompaniesandtheircustomers,orbetweencompaniesand
publicadministrations.
Theycan be classifiedbyapplicationtype:
1. Electronic Markets
• Presentarange of offeringsavailable inamarketsegmentsothatthe purchasercan compare the prices
of the offeringsandmake apurchase decision.
Example:Airline BookingSystem
2. Electronic Data Interchange (EDI)
• It providesastandardizedsystem
• Codingtrade transactions
• Communicatedfromone computertoanotherwithoutthe needforprintedordersandinvoices&delays&
errorsin paperhandling
• It isusedby organizationsthata make a large no.of regulartransactions
Example: EDI is used in the large market chains for transactions with their suppliers
3. Internet Commerce
• It isuse to advertise &make salesof wide range of goods& services.
• Thisapplicationisforbothbusinesstobusiness&businesstoconsumertransactions.

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Example:The purchase of goodsthat are thendeliveredbypostorthe bookingof ticketsthatcan
be pickedupby the clientswhentheyarrive atthe event
2. Scope of E-Commerce:
• Internete-commerce isone partof the overall sphere of e-commerce.
3. Electronic Commerce and the trade cycle:
• It can be appliedtoall,orto differentphasesof the trade cycle
• The trade cycle variousdependingon
The nature of the organizations
Frequencyof trade betweenthe patternstothe exchange
The nature of goodsand servicesbeingexchanged
• Trade cycle support
1. Findinggoodsandservices(referredtoasa search& negotiation)
2. Placingthe order,takingdelivery &makingpayment(executionandsettlement)
3. Aftersalesactivitiessuchaswarrantee,servicesetc.
The three generic trade cycles can be identified:
1. Regular,repeattransactions(repeattrade cycle)
2. Irregulartransactions,where execution&settlementare separated(credittransactions) 3. Irregular
transactionswhere execution &settlementare combined(cashtransactions)

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Electronic Markets:
• It increasesthe efficiencyof the market
• It reducesthe searchcost for the buyer& makesitmore likelythatbuyerwill continue the searchuntil the
bestbuyis found
• It existincommodity,financial markets&theyare also usedinairline bookingsystem
• It isirregulartransactiontrade
cycle.
Electronic Data Interchange:
• Applicationsare sendingtestresultsfromthe pathologylaboratorytothe hospital ordispatchingexam
resultsfromexamboardsto school
It isusedtrade exchanges

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Users are vehicle assemblers,orderingcomponentsforthe supermarkets
It isusedfor regularrepeattransactions
It takesquite lotof work toset upsystems
It ispart of schemesforjust-in-manufacture andquickresponsesupply
Mature use of EDI allowsfora change inthe nature of the productor service
Mass Customizationissuchanexample
Internet Commerce:
The first stage
Advertisingappropriate goodsandservices
Internetsitesofferonlyinformation&anyfurtherstepsdownthe trade cycle are conductedonthe
telephone
The Second stage
An increasingno.of sitesofferfacilitiestoexecute &settle the transaction
Deliverymaybe electronicorby home deliverydependingonthe goodsandservices
The final stage
After-salesservice
On-line support&On-Line services.

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Generic Framework of Electronic Commerce
Electronic Commerce Applications
SupplyChain Management Online Marketing and Advertising
Procurement & Purchasing Online Shopping
Audio and Video on D emand Online Financial Transaction
Entertainment and Gaming Education and Research
Common Business Services Infrastructure
(Security/Authentication, Electronic Payment, Directories/Catalogs)
Multimedia Content & Network Publishing Infrastructure
(Digital Video, Electronic Books, World Wide Web)
Messaging & Information Distribution Infrastructure
(EDI, E-Mail, Hy perText Transf er Protocol)
Information Superhighw ay Infrastructure
(Telecom, Cable TV, Wireless, Internet)

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3. Electronic Commerce Framework
• E-Commerce applicationwillbe builtonthe existingtechnologyinfrastructure
A myriadof computers
Communicationnetworks
Communicationsoftware
• Commonbusinessservicesforfacilitatingthe buyingandsellingprocess
• Messaging& informationdistributionasameansof sendingandretrievinginformation
• Multimediacontent&networkpublishing,forcreatingaproduct& a meansto communicate aboutit
• The informationsuperhighway- the veryfoundation-forprovidingthe highwaysystemalongwhichall e-
commerce musttravel
• The two pillarssupportingall e-commerce applications&infrastructure
• Anysuccessful e-commerce will require the I-wayinfrastructure inthe same waythatregularcommerce
needs
• I-waywill be ameshof interconnecteddatahighwaysof manyforms
Telephone,wires,cable TV wire
Radio-basedwireless-cellular&satellite
• Movies=video+audio
• Digital games=music+video+ software
• Electronicbooks=text+data + graphics+ music+ photographs+ video
• In the electronic‘highwaysystem’multimediacontentisstoresinthe formof electronicdocuments
• These are oftendigitized
• On the I-waymessagingsoftware fulfillsthe role,inanyno.of forms:e-mail,EDI,orpoint-to-pointfile
transfers
• Encryption& authenticationmethodstoensure security
• Electronicpaymentschemesdevelopedtohandle complex transactions

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• These logisticsissuesare difficultinlong-establishedtransportation
4. Anatomy of E-Commerce applications
E-Commerce applications are:
1. MultimediaContentforE-Commerce Applications
2. MultimediaStorage Servers&E-Commerce Applications
i. Client-ServerArchitecture inElectronicCommerce
ii.Internal Processesof MultimediaServers iii.Video
Servers& E-Commerce
3. InformationDelivery/Transport&E-Commerce Applications
4. ConsumerAccessDevices
Multimedia Content for E-Commerce Applications
• Multimediacontentcanbe consideredbothfuel andtrafficforelectroniccommerce applications.
• The technical definitionof multimediaisthe use of digital datainmore than one format,such as the
combinationof text,audio,video,images,graphics,numericaldata,holograms,andanimationsina
computerfile/document.
• MultimediaisassociatedwithHardware componentsindifferentnetworks.
• The Accessingof multimediacontentdependsonthe hardware capabilitiesof the customer.

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Multimedia Storage Servers & E-Commerce Applications:
• E-Commerce requiresrobustserverstostore anddistribute large amountsof digital contenttoconsumers.
• These Multimediastorage serversare large informationwarehousescapable of handlingvariouscontent,
rangingfrombooks,newspapers,advertisementcatalogs,movies,games,&X-rayimages.
• These servers,derivingtheirname because theyserveinformationuponrequest,musthandle large -scale
distribution,guarantee security,&complete reliability
i. Client-Server Architecture in Electronic Commerce
• All e-commerce applicationsfollow the client-servermodel
• Clientsare devicesplussoftware thatrequestinformationfromserversorinteractknownasmessage passing
• Mainframe computing,whichmeantfor“dump”
• The clientservermodel,allowsclienttointeractwithserverthroughrequest-replysequence governedbya
paradigmknownas message passing.
• The servermanagesapplicationtasks,storage &security& providesscalability-abilitytoaddmore clientsand
clientdevices(likePersonal digital assistantstoPc’s.See infig.

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ii. Internal Processes ofMultimedia Servers
• The internal processesinvolvedinthe storage,retrieval &managementof multimediadataobjectsare
integral toe-commerce applications.
• A multimediaserverisa hardware & software combinationthatconvertsraw data intousable information&
thendishesout.
• It captures,processes,manages,&deliverstext,images,audio&video.
• It mustdo to handle thousandsof simultaneoususers.
• Include high-endsymmetricmultiprocessors,clusteredarchitecture,andmassive parallelsystems.
iii. Video Servers & E-Commerce
The electroniccommerce applicationsrelatedtodigital videowill include
1. Telecommunicatingandvideoconferencing
2. Geographical informationsystemsthatrequire storage &navigationovermaps
3. Corporate multimediaservers
4. Postproductionstudios
5. Shoppingkiosks.
• Consumerapplicationswillinclude video-on-demand.
• The figure whichisof video–ondemandconsistvideoservers,isanlinkbetweenthe contentproviders
(media) &transportproviders(cable operators)

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Information Delivery/Transport & E-Commerce Applications
• Transport providersare principallytelecommunications,cable,&wirelessindustries.
Transport Routers
InformationTransportProviders InformationDeliveryMethods
• Telecommunicationcompanies long-distancetelephone lines;local telephone lines
• Cable televisioncompanies Cable TV coaxial,fiberoptic&satellitelines
• Computer-basedon-lineservers Internet;commercial on-line service providers
• Wirelesscommunications Cellular&radionetworks;pagingsystems
Consumer AccessDevices
InformationConsumers AccessDevices
• Computerswithaudio&video Personal/desktopcomputingcapabilities Mobile
computing
• Telephonicdevices Videophone
• Consumerelectronics Television+set-topbox Game systems
• Personal digital assistants(PDAs) Pen-basedcomputing,voice-drivencomputing
E-Commerce Consumer applications:

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• People needsentertainmentondemandincludingvideo,games,newson-demand,electronicretailingvia
catalogsetc.
• Currentlynowwe are takingthe videoon-demand.
• Why mostcompaniesbettingheavilyonthis?
1. 93 millionhomeshave television
2. Americansspendnearlyhalf theirfree time watchingtelevision
3. Everyevening,more thanone-thirdof the populationisinfrontof a television4.Sight,sound,andmotion
combine tomake televisionapowerfulmeansof marketing
1. Consumer Applications and Social Interaction:
• Lessonsfromhistoryindicate thatthe mostsuccessful technologiesare those thatmake theirmark
social
• In 1945, in U.S no one had TV.By 1960 about 86percentof householdsdid
• Nowcontrast withTelephone.Bell inventedthe telephone in1876 and by1940, 40% of U.S.
householdsandby1980 about 95-98 percentof householdsconnected
• PenetrationwasslowerforTelephone thanforTV because of the effortneededtosetupthe
wiringinfrastructure
The impactof both wasgood onbusiness,social,consumerbehaviorandentertainmenthabits
Radiobeganin 1960, and by 1989, almost3 decadeslater,just319 radiostationsfollowedthe news
format
In 1994, theirnumberexceeded1000 What do
Consumers really want?
1. Theywant qualityandcostof service
2. If a newsystemrequiresmore stepstodoessentiallythe same things,consumersmayresistit
3. Some people fitthatmold,butmostof publicpreferstolayback and justwatch televisionandlet
someone else dothe workof figuringoutthe sequence of televisionprogramming
What are Consumers willing to spend?

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1. Accordingto the videoon-demand,consumersgetthe cable bill atbasiccharge theywill buy
2. If it is doubledtheywill notbuyandat the service providereconomicswill increasedthennetwork
operatorsmightlooktoadvertisestofill the gap
Delivering products to Consumers
1. Packingand distributionmustbe considered
2. Blockbustervideocollectsthe informationandshowsthe typical consumer
3. Spends$12 a monthon home videoexpenditures
4. Go to videostore toselectvideoonlimitedbudgetandhastime tokill
5. Onlyperiodicallyexpendsalarge sumof money
Consumer Research and E-Commerce
Consumeropinionaboutinteractivetelevisionis
46% be willingtopay
39% wantvideophone calls
63% wouldpayformovieson-demand
57% wouldpayforTelevisionshowson-demand
78% saidtheirworryaboutit is thattheywill payfor somethingthattheypreviouslyreceivedfreeof
charge
64% are thinkitmake itharder forviewerstoprotectprivacy 41% are
tell thatit istoo confusingtouse
Changing business Environment
1. The traditional businessenvironmentischangingrapidly
2. Many companiesare lookingoutsideandwithintoshape businessstrategies
3. These activities include private electronic connections to
customers,suppliers,distributors,industrygroupsetc
4. The I-superhighwaywillexpandthistrendsothatit allow businesstoexchange information.

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E-Commerce and the retail Industry
1. Conditionsare changinginthe “new economy”withrespecttothe retail industry
2. Consumersare demandinglowerprices,betterquality,alarge selectionof in-seasongoods.
3. Retailersare fillingtheirorderbyslashingback-office costs,reducingprofitmargins,reducingcycle times.
buyingmore wiselyandmakinghuge investmentsintechnology
4. Retailersare inthe immediate line of fire andwere firsttobearthe bruntof cost cutting
Marketing and E-Commerce
1. E-commerce isforcingcompaniestorethinkthe existingwaysof doingtargetmarketingandevenevent
marketing.
2. Interactive marketingisinelectronicmarketsviainteractivemultimediacatalogs
3. Users findmovingimagesmore appealingthanstill image andlisteningmore appealingthanreading
texton a screen
4. Consumerinformationservicesare anew type of catalog business
Inventory Management and Organizational Applications
1. Withbordersopeningupandcompaniesfacingstiff global competition
2. Adaptationwouldinclude movingtocomputerized,“paperless”operationstoreduce
3. Once targetedbusinessprocessisinventorymanagement,solutionsforthese processesgobydifferent
names

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4. In manufacturingindustrythey’re knownasjust-in-time inventorysystems,inthe retail asquick
response programs,andintransportationindustry asconsignmenttrackingsystems
Just-in-Time (JIT) Manufacturing
1. It isviewedasan integratedmanagementsystemconsistingof anumberof differentmanagement
practicesdependentonthe characteristicsof specificplants
2. The firstprinciple iseliminationof all waste (time,materials,labour&equipment)
3. The followingmanagementpracticesare focusedfactory,reducedset-uptimes,grouptechnology,total
productive maintenance,multifunctionemployees,uniformworkloads,ITpurchasing,kanbantotal quality
control & qualitycircles
Quick Response Retailing (QR)
1. It isa versionof JITpurchasingtailoredforretailing
2. To reduce the riskof beingof outof stock,retailersare implementingQRsystems
3. It providesfora flexible response toproductorderingandlowerscostlyinventorylevels
4. QR retailingfocusesonmarketresponsivenesswhilemaintaininglow levelsof stocks
5. It createsa closedloopconsistingof retailer,vendor,&consumerchain,&asconsumersmake purchasesthe
vendorordersnewdeliveriesfromthe retailerthroughitscomputernetwork
Supply Chain Management
1. QR and JIT addressonlypartof the overall picture
2. SupplyChainManagement(SCM) isalsocalled“extending”,whichmeansintegratingthe internal and
external partnerson the supplyandprocesschainstoget raw materialstothe manufacturerandfinished
productsto the consumer

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3. It includesfollowingfunctions
Suppliermanagement:The goal istoreduce the numberof suppliersandgetthemtopartners
Inventorymanagement:The goal isto shortenthe order-ship-bill cycle.Whenamajorityof
partnersare electronicallylinked,informationfaxedormailed
Distributionmanagement:The goal isto move documents(accurate data) relatedtoshipping
Channel management:The goal isto quicklydisseminate informationaboutchangingoperational conditions
( technical,product,andpricinginformation) totradingpartners
Paymentmanagement:The goal istolinkcompanyandthe suppliersanddistributorssothat
paymentscanbe sentandreceivedelectronically
Financial management:The goal isto enable global companiestomanage theirmoneyinvariousforeign
exchange accounts
Salesforce productivity:The goal istoimprove the communicationflow of informationamongthe
sales,customer&productionfunctions
In sum,the supplychainmanagementprocessincreasinglydependsonelectronicmarkets
Work group Collaboration Applications:
1. A internetwork thatenableseasyandinexpensive connectionof variousorganizational segments
2. It isto improve communicationsandinformationsharingandtogatherand analyze competitive data
inreal-time
3. Videoconferencing,documentsharingandmultimediae-mail,are expectedtoreduce travel and
encourage telecommuting
4. Improvesthe distributionchannelfordocumentsandrecordstosuppliers,collaboratorsand
distributors

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Unit- II
CONSUMER-ORIENTED APLLICATIONS
• The wide range of applicationsenvisionedforthe consumermarketplace canbe broadlyclassifiedinto:
(i) Entertainment
(ii) Financial ServicesandInformation
(iii) Essential Services
(iv) Educationand Training
ConsumerLife-StyleNeeds ComplementaryMultimediaServices
• Entertainment Moviesondemand,videocataloging,interactive
Ads, Multi-usergames,on-line discussions.
• Financial Servicesand Home Banking,Financial services,Information,
Financial news.
• Essential Services Home Shopping,ElectronicCatalogs,telemedicine,remotediagnostics.
• Educationand Training Interactive education,multiusergames,video conferencing,on-line
databases.
1. Personal Finance andHome BankingManagement
(i) Basic Services
(ii) IntermediateServices
(iii) Advancedservices
2. Home Shopping
(i) Television-BasedShopping
(ii) Catalog-BasedShopping
3. Home Entertainment

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(i) Size of the Home EntertainmentMarket
(ii) Impact of the Home EntertainmentonTraditionalIndustries4.Microtransactionsof Information
1. Personal Finance and Home Banking Management:
• The newesttechnologiesare directdepositof payroll,on-line bill paymentandtelephonetransfers
• The technologyforpayingbills,whetherbycomputerortelephone,isinfinitelymore sophisticatedthan
anythingonthe marketa fewyearsago
• In 1980s were the daysof “stone age” technologybecause of technologychoicesforaccessingservices
were limited
• For home banking,greaterdemandsonconsumersandexpandingneedforinformation,it’sservicesare
oftencategorizedasbasic,intermediateandadvanced
(i) Basic services
• These are relatedtopersonal finance
• The evolutionof ATMmachinesfromlive tellersandnow tohome banking
• The ATM networkhaswithbanksand theirassociationsbeingthe routersandthe ATMmachinesbeingthe
heterogeneouscomputersonthe network.
• Thisinteroperablenetworkof ATMshas createdan interface betweencustomerandbankthat changedthe
competitivedynamicsof the industry.Seeinnextfigure
• IncreasedATMusage anddecrease intellertransactions
• The future of home bankinglieswithPC’s

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(ii) Intermediate Services
• The problemwithhome bankingin1980 is,it isexpensive service thatrequiresaPC,a modemand
special software
• As the equipmentbecomeslessexpensive andasbankoffersbroaderservices,homebankingdevelop
intoa comprehensivepackage thatcouldevenincludeasinsurance entertainment
• Considerthe computerizedon-line bill-paymentsystem
• It neverforgetstorecorda paymentandkeepstrackof useraccount number,name,amountandthe
date and we usedto instructwithpaymentinstructions.See in Fig;

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(iii)Advanced Services
• The goal of advancedseriesistooffertheiron-linecustomersacomplete portfolioof life,home,and
auto insurance alongwithmutual funds,pensionplans,home financing,andotherfinancial products
• The Figure explainsthe range of servicesthatmaywell be offeredbybanksinfuture
• The servic3esrange fromon-line shoppingtoreal-timefinancial informationfromanywhere inthe world
• In short,home bankingallowsconsumerstoavoidlonglinesandgivesflexibility
2. Home Shopping:
• It isalreadyinwide use.
• Thisenable acustomerto do online shopping

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(i) Television-Based Shopping:
• It islaunchedin1977 by the Home ShoppingNetwork(HSN).
• It providesavarietyof goodsrangingfromcollectibles,clothing,smallelectronics,house wares,jewelry,
and computers.
• WhenHSN startedinFloridain1977, itmainlysoldfactoryoverrunsanddiscontinueditems
• It worksas, the customerusesherremote control at shopdifferentchannelswithtouchof button.At
thistime,cable shoppingchannelsare nottrulyinteractive
(ii) Catalog-Based Shopping
• In thisthe customeridentifiesthe variouscatalogsthatfitcertainparameterssuchassafety,price,and
quality
• The on-line catalogbusinessconsistsof brochures,CD-ROMcatalogs,and on-line interactive catalogs
• Currently,we are usingthe electronicbrochures
3. Home Entertainment:
• It isanotherapplicationfore-commerce
• Customercan watchmovie,playgames,on-screencatalogs,suchasTV guide.

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• In Home entertainmentarea,customeristhe control overprogramming
• In Table tellsthe,Whatwill be requiredintermsof Television-basedtechnologyforthistelemartto
become a reality
The Telemart: Present and Future Functions
• Compressinganddecoding The transitiontodigital satellite a digital signal(imagesare
and cable network headbroad compresstoreduce quantity castinginvolveslinkingthe TV of
information) to decodertoreconvertintoan
analogsignal
• Decodinga scrambled The broadcastingof pay channel
signal requiresthe encryptionof the
signal onemission&unscrambled
• Rapidloadingof program An increase inthe no.of individual on memory
interactive servicesispossible onlyif n/w overloadingiskept
minimum
• Electronicmoneyor Once separated fromthe telephone, card paymentterminal
telemartwill needakeyboard up to the TV setin orderto ensure
interactivity.The keyboardwill have a paymentconnectionto
simplifythe billing process Advanced Services
Size of the home Entertainment Market:
• Entertainmentservicesare playamajor role ine-commerce
• Thispredictionisunderscoredbythe changingtrendsinconsumerbehavior.
• It isshowninTable
Impact of Home entertainment on traditional industries:
• Thiswill have devastatingeffectsontheaterbusiness
• Economicissuesmightallow theaterstomaintainanimportantrole inthe movie industry
• Today average cable bill isapproximately$30 a month

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IndustryEstimatesof consumerExpenditures
1980 ($4.7 bin) 1990 ($31.0 bin) 1993 ($37.8 bin)
Theaters 49.0% $2.3 14.5% $4.5 13.2% $5.0
Basic cable 35.0% $1.6 34.5% $10.7 36.9% $13.9
Premiumcable 16.0% $0.8 16.5% $5.1 14.0% $5.3
Home video __ __ 33.8% $10.5 34.8% $13.2
Pay perview __ __ 0.7% $0.2 1.1% $0.4
4. Micro transactions of information:
• One change in traditional businessforcedbythe on-lineinformationbusinessisthe creationof a
newtransactioncategorycalledsmall-feetransactionsformicroservices
• The customerby givingsome informationawayforfree andprovide informationbundlesthatcover
the transactionoverhead.
• The growth of small-moneytransferscouldfosteraboominother complementaryinformation
services
• The complexityisalsoincreasedinmicroserviceswhenanactivitynamed,reverificationisentered.
• It meanscheckingonthe validityof the transactionafterithas beenapproved
Desirable Characteristics ofan Electronic marketplace
• Critical massof Buyersandsellers:Togetcritical mass,use electronicmechanisms
• Opportunityforindependentevaluationsand forcustomerdialogueanddiscussion:Usersnotonly
buyand sell products,theycompare notesonwhohas the bestproductsand whose pricesare
outrageous
• Negotiationandbargaining:Buyersandsellersneedtoable tohaggle overconditionsof mutual
satisfaction,money,terms&conditions,deliverydates&evaluationcriteria
• Newproductsand services:Electronicmarketplace isonlysupportfull informationaboutnew
services
• Seamlessinterface:The tradingishavingpiecesworktogethersothatinformationcanflow
seamlessly

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• Resource fordisgruntledbuyers:Itprovide forresolvingdisagreementsbyreturningthe product.
Mercantile Process models
• Mercantile processesdefineinteractionmodelsbetweenconsumersandmerchantsforonline
commerce
Mercantile Models from the Consumer's Perspective
(i) Pre purchase preparation:The pre purchase preparationphase includesearchanddiscoveryforaset of
productsto meetcustomerrequirements
(a) The consumerinformationsearchprocess.
(b) The Organizational searchprocess.
(c) Consumersearchexperiences.
(d) Informationbrokers&brokerages.
(ii) Purchase consummation:The purchase consummationphase include mercantile protocols
(a) Mercantile processusingdigital cash.
(b) Mercantile transactionusingcreditcards.
(c) Costsof electronicpurchasing.
(iii) Postpurchase interaction:The postpurchase interactionphase includescustomerservice &support

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(i) Pre purchase Preparation
• The purchase is done bythe buyers,soconsumerscan be categorizedinto3 types
• Impulsive buyers,whopurchase productsquickly
• Patientbuyers,purchase productsaftermakingsome comparisons
• Analytical buyers,whodosubstantial researchbefore makingdecisiontopurchase products,.
Marketing researcheshave several types ofpurchasing:
• Specificallyplannedpurchases
• Generallyplannedpurchases
• Reminderpurchase
• Entirelyunplannedpurchases
The consumer information search process
• Informationsearchisdefinedasthe degree of care,perception,&effortdirectedtoward
obtainingdataor informationrelatedtothe decisionproblem
The Organizational search process

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Organizational searchcanbe viewedasa processthroughwhichan organizationadaptsto
such changesinitsexternal environmentasnew suppliers,products,&services.
Consumer Search Experiences
• The distinctionbetween carryingouta shoppingactivity“toachieve agoal”(utilitarian) as
opposedtodoingitbecause “ u love it”(hedonic).
Information Brokers and Brokerages
• To facilitate betterconsumerandorganizational search,intermediariescalledinformation
brokersor brokerages
• Informationbrokeragesare neededfor3reasons:Comparisonshopping,reducedsearch
costs,and integration
(ii) Purchase Consummation
• Buyercontacts vendortopurchase
• Vendorstatesprice
• Buyerand Vendormayor may notengage innegotiation
• If satisfied,buyeraskthe paymenttothe vendor
• Vendorcontactsbillingservice
• Billingservicedecryptsauthorizationandcheckbuyersaccountbalance
• Billingservicegivestothe vendortodeliverproduct
• Vendordeliversthe goodstobuyer
• On receivingthe goods,the buyersignsanddeliversreceipt
• At the endof the billingcycle,buyerreceivesalistof transactions

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Mercantile process using Digital Cash
• Buyerobtainse-cashfromissuingbank
• Buyercontacts sellertopurchase product
• Sellerstatesprice
• Buyersendse-cashtoseller
• Sellercontactshisbankor billingservice toverifythe validityof the cash
• Bank givesokaysignal
• Sellerdeliversthe producttobuyer
• Sellerthentellsbanktomark the e-cashas “used”currency
Mercantile Transactions Using Credit Cards
• Two majorcomponentscompromise creditcardtransactionsinthisprocess:electronic
authorizationand settlement
• In retail transaction,athird-partyprocessor(TPP) capturesinformationatthe pointof sale,
transmitsthe informationtothe creditcard issuerforauthorization,communicatesa
response tothe merchantand electronicallystoresthe informationforsettlementand
reporting.
• The benefitsof electronicprocessinginclude the reductionincreditlosses,lowermerchant
transactioncosts,& fasterconsumercheckout& merchant-to-banksettlement

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A step-by-stepaccountof retail transactionfollows:
• Step1:A customerpresentsacreditcard for paymentat a retail location
• Step2:The point-of-salesoftwaredirectsthe transactioninformationtothe local network
• Step3:Systemverifiesthe source of the transactionandroutesit.
• Step4:In this,transactioncountand financial totalsare confirmedbetweenthe terminal and
the network
• Step5:In this,the systemgathersall completedbatchesandprocessesthe datain
preparationforsettlement
A merchantclienttakesone of twoforms:
• Merchants are charged a flatfee pertransactionforauthorizationanddata capture services
The other formof billingallowsmerchantstopaya ”bundled”price forauthorization,data
capture,& settlement
Cost ofElectronic Purchasing:
• Cash seemstobe preferable toelectronicpayments,suchas,on-linedebit,credit,and
electroniccheckauthorization
• Consumersappeartospendmore whenusingcardsthenwhenspendingcash
(iii)Post purchase Interaction
• Returnsand claimsare an importantpart of the purchasingprocess
• Othercomplex customerservice challengesarise incustomizedretailingare:
Inventoryissues:Toserve the customerproperly,acompanyshouldinformacustomerrightaway
and if the itemisin stock,a companymust able toassignthat piece tocustomer
Database access andcompatibilityissues:Customersshouldgetkindof servicesbyeasyissueslike
callingan800 number
Customerservice issues:Toclearthe doubtsof customerabout product
Mercantile Models from the Merchant's Perspective
• To betterunderstanding,itisnecessarytoexamine the ordermanagementcycle (OMC).
• The OMC includeseightdistinctactivities.

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• The actual detailsof OMC varyfrom industrytoindustryandalsofor individual productsand
services
• OMC has genericsteps
(i) Orderplanning&Order generation.
(ii) Cost estimation&pricing.
(iii) Orderreceipt& entry.
(iv) Orderselection&prioritization.
(v) OrderScheduling
(vi) Orderfulfillment&delivery.
(vii) Orderbilling&account/paymentmanagement.
(viii) Postsalesservice.
Order planning & order Generation
• Orderplanningleadstoordergeneration.
• Ordersare generatedinano. of ways inthe e-commerce environment.
• The salesforce broadcastsads (directmarketing),sendspersonalizede-mail tocustomers
(coldcalls),orcreatesa WWW page

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Cost Estimation & pricing
• Pricingisthe bridge betweencustomerneeds&companycapabilities.
• Pricingat the individualorderlevel dependsonunderstandingthe value tothe customerthat
isgeneratedbyeachorder,evaluatingthe costof fillingeachorder;&institutingasystem
that enablesthe companytoprice eachorder basedonitsvalue & cost
Order Receipt & Entry
• Afteran acceptable price Quote,the customerentersthe orderreceipt&entryphase of
OMC.
• Thiswas underthe purviewof departmentsvariouslytitledcustomerservice,orderentry,the
inside salesdesk,orcustomerliaison.
Order Selection & Prioritization
• Customerservice representativesare alsooftenresponsibleforchoosingwhichordersto
accept andwhichto decline.
Not,all customers’ordersare createdequal;some are betterforthe business.
Order Scheduling
• In thisphase the prioritizedordersgetslottedintoanactual productionoroperational
sequence.
• Thistask isdifficultbecause the differentfunctional departments- sales,marketing,,customer
service,operations,orproduction- mayhave conflictinggoals,compensationsystems,&
organizational imperatives:
Productionpeopleseektominimize equipmentchangeovers,while marketing&customerservice
repsargue forspecial service forspecial customers.
Order Fulfillment & Delivery
• In thisactual provisionof the productor service ismade.
• It involvesmultiple functionsandlocations.
Order Billing & Account/Payment Management
• Afterthe orderhas beenfulfilled&delivered,billingisgivenbyfinancestaff.

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• The billingfunctionisdesigned toserve the needsandinterestsof the company,notthe
customer.
Post sales Service
• Thisphase playsan increasinglyimportantrole inall elementsof acompany’sprofitequation:
customer,price,&cost.
• It can include suchelementsasphysical installationof aproduct,repair& maintenance,
customertraining,equipmentupgrading&disposal.

Unit- III
Types of Electronic Payment Systems
• Electronicpaymentsystemsare proliferatinginbanking,retail,healthcare,on-line markets,
and evengovernment—infact,anywhere moneyneedstochange hands.
• Organizationsare motivatedbythe needtodeliverproductsandservicesmore cost
effectivelyandtoprovide ahigherqualityof service tocustomers.
• The emergingelectronicpaymenttechnologylabeledelectronicfundstransfer(EFT).
• EFT is definedas“anytransferof fundsinitiatedthroughanelectronicterminal,telephonic
instrument,orcomputerormagnetictape so as to order,instruct,or authorize afinancial
institution
EFT can be segmentedintothree broadcategories:
• Bankingandfinancial payments
– Large-scale orwholesale payments(e.g.,bank-to-banktransfer)
– Small-scale orretail payments(e.g.,automatedtellermachines)
– Home banking(e.g.,bill payment)
• Retailingpayments
– CreditCards(e.g.,VISA orMasterCard)
– Private label credit/debitcards(e.g.,J.C.PenneyCard)
– Charge Cards (e.g.,AmericanExpress
• On-line electroniccommerce payments
– 1. Token-basedpaymentsystems
• Electroniccash(e.g.,DigiCash)
• Electronicchecks(e.g.,NetCheque)
• Smart cards or debitcards (e.g.,Mondex ElectronicCurrencyCard))
– 2. Creditcard-basedpaymentssystems

• EncryptedCreditCards(e.g.,WorldWide Webform-basedencryption)
• Third-partyauthorizationnumbers(e.g.,FirstVirtual)
1) Digital Token-Based Electronic Payment Systems
Electronictokensare three types:
1. Cash or Real-time
• Transactionsare settledwithexchange of electroniccurrency.
• Ex: on-line currencyexchange iselectroniccash(e-cash).
2. Debit or Prepaid
• Users pay in advance forthe privilege of gettinginformation.
• Ex: prepaidpaymentmechanismsare storedinsmartcards and electronicpursesthatstore
electronicmoney.
3. Credit or Postpaid
• The serverauthenticatesthe customersandverifieswiththe bankthatfundsare adequate
before purchase.
• Ex: postpaidmechanismsare credit/debit cards andelectronic checks.
Properties ofElectronic Cash:
• There are manywaysthat existforimplementingane-cashsystem, all mustincorporate a
fewcommonfeatures.
• Specifically,e-cashmusthave the followingfourproperties:
1. Monetaryvalue
2. Interoperability
3. Retrievability
4. Security
Electronic Cash in Action

• ElectronicCashisbasedon cryptographicsystemscalled“digitalsignatures”.
• Thismethodinvolvesapairof numerickeys:one forlocking(encoding) andthe otherfor
unlocking(decoding).(Throughpublickeyandprivate key).
Purchasing E-cash from Currency Servers
The purchase of e-cashfroman on-line currencyserver(orbank) involvestwosteps:
• Establishmentof anaccount and
• Maintainingenoughmoneyinthe accounttobank the purchase.
Some customersmightprefertopurchase e-cashwithpapercurrency,eithertomaintainanonymity
or because theydon’thave a bankaccount.
Using the Digital Currency
• Once the tokensare purchased,the e-cashsoftware onthe customer’sPCstoresdigital
moneyundersignedbyabank.
• The userscan spendthe digital moneyatanyshopacceptinge-cash,withouthavingtoopen
an account there or havingtotransmitcreditcard numbers.
• As soonas the customerwantsto make a payment,the software collectsthe necessary
amountfrom the storedtokens.
Electronic Checks
• It isanotherform of electronictokens.

• In the givenmodel showninfig,buyersmustregisterwiththird-partyaccountserverbefore
theyare able towrite electronicchecks.
• The account serveracts as a billingservice.
• The advantagesare:
1. Theyworkin the same way as traditional checks.
2. These are suitedforclearingmicropayments
3. Theycreate float& availabilityof floatisanimportantforcommerce
4. Financial riskisassumedbythe accountingserver&may resultineasieracceptance
Smart Cards & Electronic Payment Systems
• Smart cards have beeninexistence since the early1980s andholdpromise forsecure
transactionsusingexistinginfrastructure.
• Smart cards are creditanddebitcards and othercard productsenhancedwith
microprocessorscapable of holdingmore informationthanthe traditional magneticstripe.
• The smart card technologyiswidelyusedincountriessuchasFrance,Germany,Japan,and
Singapore topay forpublicphone calls,transportation,andshopperloyaltyprograms.
Smart cards are basically two types:
– Relationship-BasedSmartCreditCards

– ElectronicPurses,whichreplace money,are alsoknownasdebitcardsand electronic
money.
Relationship-Based Smart Credit Cards
– It isan enhancementof existingcardsservices&/orthe additionof new servicesthat
a financial institutiondeliverstoitscustomersviaa chip-basedcardor otherdevice
– These servicesinclude accesstomultiplefinancial accounts,value-addedmarketing
programs,or otherinformationcardholders maywantto store on theircard
– It includesaccesstomultiple accounts,suchasdebit,credit,cashaccess,bill payment
& multiple accessoptionsatmultiple locations
Electronic Purses
• To replace cash andplace a financial instrumentare racingto introduce “electronicpurses”,
wallet-sizedsmartcardsembeddedwithprogrammable microchipsthatstore sumsof money
for people touse insteadof cashforeverything
• The electronicpurse worksinthe followingmanner:
1. Afterpurse isloadedwithmoneyatan ATM, itcan be usedto payfor candy ina vending
machine witha card reader.
2. It verifiescardisauthentic& ithas enoughmoney,the value isdeductedfrombalance onthe
card & addedtoan e-cash& remainingbalance isdisplayedbythe vendingmachine.
2) Credit Card-Based Electronic Payment Systems
Paymentcardsare all typesof plasticcards that consumersuse tomake purchases:
– Creditcards
• Such as a Visaora MasterCard,has a presetspendinglimitbasedonthe user’s
creditlimit.
– Debitcards
• Removesthe amountof the charge fromthe cardholder’saccountand transfers
it to the seller’sbank.
– Charge cards
• Such as one fromAmericanExpress,carriesnopresetspendinglimit.

Advantages:
– Paymentcardsprovide fraudprotection.
– Theyhave worldwide acceptance (nearly!).
– Theyare goodfor online transactions.
Disadvantages:
– Paymentcard service companiescharge merchantsper-transactionfeesandmonthly
processingfees.
Payment Acceptance and Processing
• Openloop(suchas VISA) andclosedloop(suchasAmericanExpress) systemswillacceptand
processpaymentcards.
• A merchantbankor acquiringbankis a bank thatdoesbusinesswithmerchantswhowantto
accept paymentcards.
• Software packagedwithyourelectroniccommerce software canhandle paymentcard
processingautomatically.
• Electroniccashis a general termthatdescribesthe attemptsof several companiestocreate
value storage andexchange systemthatoperatesonline inmuchthe same waythat
government-issuedcurrencyoperatesinthe physical world.
• Concernsaboutelectronicpaymentmethodsinclude:
– Privacy
– Security

– Independence
– Portability
– Convenience
Electronic Cash Issues
• Primaryadvantage iswithpurchase of itemslessthan£5
• Creditcard transactionfeesmake small purchasesunprofitable
• FacilitatesMicropayments –eg foritemscostinglessthan£1
• Must be anonymous, justlikeregularcurrency
• Safeguardsmustbe inplace to preventcounterfeiting
• Must be independentandfreelytransferable regardlessof nationalityorstorage
mechanism
Electronic Cash Storage
• Two methods
– On-line
• Individual doesnothave possessionpersonallyof electroniccash
• Trustedthirdparty,e.g.e-banking,bankholdscustomers’cashaccounts
– Off-line
• Customerholdscashon smart card or electronicwallet
• Fraud anddouble spendingrequire tamper-proof encryption
Risks in Electronic Payment systems
• Customer'srisks
– Stolencredentialsorpassword
– Dishonestmerchant
– Disputesovertransaction

– Inappropriate use of transactiondetails
• Merchant’srisk
– Forgedor copiedinstruments
– Disputedcharges
– Insufficientfundsincustomer’saccount
– Unauthorizedredistributionof purchaseditems
• Main issue:Secure paymentscheme
Electronic payments Issues
• Secure transferacrossinternet
• Highreliability:nosingle failurepoint
• Atomictransactions
• Anonymityof buyer
• Economicand computational efficiency:allow micropayments
• Flexibility:acrossdifferentmethods
• Scalabilityinnumberof serversandusers Designing Electronic Payment systems
It includesseveral factors:
• Privacy. A userexpectstotrust ina secure system;justas a telephoneisasafe
• Security. A secure systemverifiesthe identityof two-partytransactionsthrough“user
authentication”&reservesflexibilitytorestrictinformation/servicesthroughaccesscontrol
• Intuitive interfaces.The paymentinterface mustbe aseasyto use as a telephone.
• Database integration.Withhome banking,forex,acustomerwantsto playwithall his
accounts.
• Brokers. A “networkbanker”-someonetobrokergoods& services,settle conflicts,&
‘inancial transactionselectronically-mustbe inplace
• Pricing. One fundamental issue ishow toprice paymentsystemservices.Fore.g.,fromcash
to bankpayments,frompaper-basedtoe-cash.The problemispotentialwaste of resources.

• Standards. Withoutstandards,the weldingof differentpaymentusersintodifferent
networks&differentsystemsisimpossible.
Unit- IV
Electronic Data Interchange
• ElectronicData Interchange (EDI) - interposescommunicationof businessinformationin
standardizedelectronicform
• Priorto EDI, businessdependedonpostal andphone systemsthatrestrictedcommunication
to those fewhoursof the workdaythatoverlap betweentimezones
Why EDI
• Reductionintransactioncosts
• Fostercloserrelationshipsbetweentradingpartners
EDI & Electronic Commerce
• Electroniccommerce includesEDI& much more

• EDI forgesboundarylessrelationshipsbyimprovinginterchange of informationbetween
tradingpartners,suppliers,&customers
• Electroniccommerce includesEDI& much more
• EDI forgesboundarylessrelationshipsbyimprovinginterchange of informationbetween
tradingpartners,suppliers,&customers
Benefits ofEDI
• Cost & time savings,Speed,Accuracy,Security,SystemIntegration,Just-In-Time Support.
• Reducedpaper-basedsystems,i.e.recordmaintenance,space,paper,postagecosts
• Improvedproblemresolution&customerservice
• Expandedcustomer/supplierbase orsupplierswithnoEDIprogramlose business
EDI layered architecture
• Semantic(orapplication) layer
• Standardstranslationlayer
• Packing(ortransport) layer
• Physical networkinfrastructure layer
EDI semantic layer:
• Describesthe businessapplication
• Procurementexample

– Requestsforquotes
– Price quotes
– Purchase orders
– Acknowledgments
– Invoices
• Specifictocompany& software used
Standards translation:
• Specifiesbusinessformstructure sothatinformationcanbe exchanged
• Two competingstandards
– AmericanNational StandardsInstitute(ANSI)X12
– EDIFACTdevelopedbyUN/ECE,WorkingPartyfor the Facilitationof International
Trade Procedures
EDI transport layer
• How the businessformissent,e.g.post,UPS,fax
• Increasingly,e-mailisthe carrier• DifferentiatingEDIfrome-mail
– Emphasisonautomation
– EDI has certainlegal status
Physical network infrastructure layer
• Dial-uplines,Internet,value-addednetwork,etc.
EDI in Action
• The fig showsthe informationflow whenpaperdocumentsare shuffledbetween
organizationsviathe mailroom
• Whenthe buyersendsa purchase order,thenrelevantdata extracted&recordedona hard
copy.
• Thishard copy isforwardedtoseveral steps,atlastmanuallyenteredintosystembythe data
entryoperators

• Thisprocessis somewhatoverheadinlaborcosts& time delays.
EDI in Action
• InformationflowwithEDIare as follows:
1. Buyersendspurchase orderto sellercomputer
2. Sellersendspurchase orderconfirmationtobuyer
3. Sellersendsbookingrequesttotransportcompany
4. Transport companysendsbookingconfirmationtoseller
5. Sellersendsadvance shipnoticetobuyer
6. Transport companysendsstatustoseller
7. BuyersendsReceiptadvice toseller
8. Sellersendsinvoice tobuyer
9. Buyersendspaymenttoseller
EDI as a fast,inexpensive &safe method

Benefits ofEDI
• Cost & time savings,Speed,Accuracy,Security,SystemIntegration,Just-In-Time Support.
• Reducedpaper-basedsystems,i.e.recordmaintenance,space,paper,postagecosts
• Improvedproblemresolution&customerservice
• Expandedcustomer/supplierbase orsupplierswithnoEDIprogramlose business
EDI Applications in Business
Four differentscenariosinindustriesthatuse EDIextensively:
1. International orcross-bordertrade
2. Electronicfundstransfer
3. Healthcare EDI for insurance claimsprocessing
4. Manufacturing& retail procurement
5. International or cross-border trade
• EDI has alwaysbeenverycloselylinkedwithinternationaltrade.
• Trade efficiency,whichallowsfaster,simpler,broader&lesscostlytransactions
Role ofEDI in international trade
• EDI facilitatesthe smoothflow of information

• It reducespaperwork
• EDI benefitsforinternationaltrade are
1. Reducedtransactionexpenditures
2. Quickermovementof imported&exportedgoods
3. Improvedcustomerservice through“track& trace” programs
4. Fastercustomsclearance & reducedopportunitiesforcorruption,ahuge problemintrade
2. Interbank Electronic Funds Transfer (EFT)
• EFTS is credittransfersbetweenbankswherefundsflowdirectlyfromthe payer’sbanktothe
payee’sbank.
• The two biggestfundstransferservicesinthe UnitedStatesare the Federal Reserve’ssystem,
Fedwire,& the ClearingHouse InterbankPaymentsSystem(CHIPS)of the New Yorkclearing
house
Automated Clearinghouse (ACH) Transfers
• ACH transfersare usedto processhighvolumesof relativelysmall-dollarpaymentsfor
settlementinone ortwo businessdays
• It providesservices:preauthorizeddebits,suchasrepetitive bill payments;&
consumerinitiatedpayments.
3. Health care EDI for insurance EDI
• Providinggood&affordable healthcare isa universal problem
• EDI is becomingapermanentfixtureinbothinsurance &healthcare industriesasmedical
provider,patients,&payers
• Electronicclaimprocessingisquick&reducesthe administrative costsof healthcare.
• UsingEDI software,serviceprovidersprepare the forms&submitclaimsviacommunication
linestothe value-addednetworkservice provider
• The company theneditssorts& distributesformstothe payer.If necessary,the insurance
companycan electronicallyroute transactionstoathird-partyforprice evaluation
• Claimssubmissionalsoreceivesreportsregardingclaimstatus&requestforadditional
information

4. Manufacturing & retail procurement using EDI
• These are heavyusersof EDI
• In manufacturing,EDIisusedto supportjust-in-time.
• In retailing,EDIisusedtosupportquickresponse
Just-In-Time & EDI
• CompaniesusingJIT&EDI calculateshow manypartsare neededeachdaybasedonthe
productionschedule &electronicallytransmitorders.
• Deliveryhastobe responsive,oritwill costtoo muchin money& time.
• Gettingdata to suppliersquickly
• A majorbenefitof JIT& EDI is a streamlinedcashflow.
Quick Response & EDI
• For the customer,QR meansbetterservice &availabilityof awiderrange of products
• For the retailer&supplier,QRmaymeansurvival ina competitivemarketplace
• Much focus of QR is inreductionof leadtimesusingevent-drivenEDI.
• In QR, EDI documentsinclude purchaseorders,shippingnotices,invoices,inventoryposition,
catalogs,& order status
EDI: Legal, Security, & Privacy Issues
Legal Status ofEDI Messages
• To understandthe legal framework,let’stake alookonthree modesof communicationtypes:
Instantaneouscommunication,delayedcommunicationviathe U.S.Postal Service (USPS),&
delayedcommunicationvianon-USPScouriers;
1. Instantaneous.If the partiesare face toface or use an instantaneouscommunicationmedium
such as the telephone
2. Delayed(USPS).The “mailboxrule”providesthatanacceptance communicatedviaUSPSmail
iseffectivelywhendispatched
3. Delayed(non-USPS).Acceptancestransmittedviatelegram, mailgram, &electronicmessages,
are communicated&operable uponreceipt.

Digital Signatures & EDI
• Digital signaturesmightbe time-stampedordigitallynotarizedtoestablishdates&times
• If digital signaturesare toreplace handwrittensignatures,theymusthave the same legal
statusas handwrittensignatures.
• It providesameansfora thirdparty to verifythatnotarizedobjectisauthentic.
• Newtypesof EDI are traditional EDI& openEDI
Traditional EDI
• It replacesthe paperformswithalmoststrictone-to-onemappingsbetweenpartsof a paper
formto fieldsof electronicformscalledtransactionsets.
• It coverstwobasic businessareas:
1. Trade data Interchange (TDI) encompassestransactionssuchaspurchase orders,invoice &
acknowledgements.
2. ElectronicFundsTransfer(EFT) isthe automatictransferof fundsamong banks& other
organizations
• It isdividedinto2camps: oldEDI & new EDI.
• OldEDI is a termcreatedby those workingonthe nextgenerationof EDIstandardsinorder to
differentiatebetweenthe present&the future.
Old EDI
• Automatingthe exchange of informationpertinenttobusinessactivity
• It isreferredasthe current EDI-standardizationprocesswhere itallowseverycompanyto
choose itsown,unique,proprietaryversion
NewEDI
• It isrefocusingof the standardizationprocess.
• In this,the structure of the interchangesisdeterminedbythe programmerwhowritesa
program.
• It removeslongstandardizationprocess.

Open EDI
• It isa businessprocedurethatenablese-commerce tooccurbetweenorganizationswhere
the interactionisof shortduration.
• It isprocessof doingEDI withoutthe upfronttradingpartneragreementthatiscurrently
signedbythe tradingpartners
• The goal isto sustainad hoc businessorshort-termtradingrelationshipsusingsimplerlegal
codes.
• It isa lawof contract withinthe contextof e-commerce wheretransactionsare notrepeated
overlongperiodof time.
Standardization & EDI
Standards translation
• Specifiesbusinessformstructure sothatinformationcanbe exchanged
• Two competingstandards
– AmericanNational StandardsInstitute (ANSI)X12
– EDIFACTdevelopedbyUN/ECE,WorkingPartyfor the Facilitationof International
Trade Procedures
Structure of EDI transactions
– Transactionsetis equivalenttoabusinessdocument,suchasa purchase order
– Data Segmentsare logical groupsof data elementsthattogetherconveyinformation
– Data elementsare individual fields,suchaspurchase order no.
Comparison ofEDIFACT & X.12 Standards
• These are comprisedof stringsof data elementscalledsegments.
• A transactionsetisa setof segmentsorderedasspecifiedbythe standard.
• ANSIstandardsrequire eachelementtohave averyspecificname,suchas orderdate or
invoice date.
• EDIFACTsegments,allowformultiuse elements,suchasdate.

• EDIFACThas fewerdataelements&segments&onlyone beginningsegment(header),butit
has more composites.
• It isan ever-evolvingplatform
EDI Software Implementation
• EDI software has4 layers:
1. Businessapplication
2. Internal formatconversion
3. EDI Translator
4. EDI envelope fordocumentmessaging
• These 4 layerspackage the information& senditoverthe value-addednetworktothe target
business,whichthenreversesthe processtoobtainthe original information
EDI Business Application Layer
1. It createsa document,aninvoice.
2. SendstoEDI translator,reformatsthe invoice intoanEDI standard.3. If there are
on the same type of computer,the datamove faster
EDI Envelope for Message Transport

The X.400 & X.435 Envelopes
• The X.400 standard wasmeantto the universal answertoe-mail interconnectivity
• It promisesmuch& to date,deliverslittle.
• The work on X.400 beganin1980
• It isthe openstandardformail interchange
• The standard existsin3 versions:1984, 1988, & 1992.
EDI Software Implementation
• The X.435 insertsa special fieldinanX.400 envelopetoidentifyanEDImessage
• It includesdataencryption;integrity;notificationof message delivery&nondelivery;&
nonrepudiationof delivery
• It issecure,reliable waytosendEDI& accompanyingfileswithinthe same message.
• Purchase orders,invoices,drawings,e-mail- all couldbe sentwithend-to-end
acknowledgmentof message receipt.
Value-Added Networks (VANs)
• A VAN isa communicationnetworkthattypicallyexchangesEDImessagesamongtrading
partners.
• It providesservices,includingholdingmessagesin“electronicmailboxes”,interfacingwith
otherVANs
• Disadvantage isEDI-enablingVANsisthattheyare slow & high-priced,chargingbythe no.of
characters transmitted

Internet-Based EDI
Several factorsmake internetuseful forEDI:
• Flat-pricingthatisnotdependentonthe amountof informationtransferred
• Cheapaccesswithlowcost of connection- oftenaflatmonthlyfee forleasedline 0rdialup
access
• Commonmail standards& provennetworking &interoperable systems
• Security--public-keyencryptiontechniquesare beingincorporatedinvariouselectronicmail
systems
Unit-V
INTRAORGANIZATIONAL ELECTRONICCOMMERCE
Internal commerce isthe applicationof electroniccommerce toprocessesoroperations.
Specifically,we defineinternal commerce asusingmethodsandpertinenttechnologiesfor
supportinginternal businessprocessesbetweenindividuals,departments,and collaborating
organizations.
It isof twotypes
1. Private commerce
2. Publiccommerce
In a general sense,the termInformationSystem(IS) referstoa systemof people,datarecords
and activitiesthatprocessthe dataand informationinanorganization,anditincludesthe
organization'smanual andautomatedprocesses.
In a narrow sense,the term information system(orcomputer-basedinformationsystem) refers
to the specificapplicationsoftwarethatisusedto store data recordsina computersystem
and automatessome of the information-processingactivitiesof the organization.

These forcesare commandinga rethinkingof the importance of the networks-computersand
communicationsandtheirrole inthe betterutilizationof corporate information in
operational andanalytical decisionmaking.
E-COMMERCE 5
Information architecture (IA) isthe art of expressingamodel orconceptof information
usedinactivitiesthatrequire explicitdetailsof complex systems.
Amongthese activitiesare librarysystems,contentManagementSystems,webdevelopment,
userinteractions,database development,programming,technical writing,enterprise
architecture,andcritical systemsoftware design.
Most definitionshave common qualities:astructural designof sharedenvironments,methodsof
organizingandlabellingwebsites,intranets,andonline communities,andwaysof bringingthe
principlesof designandarchitecture tothe digital landscape
What Is Cross-functional Management?
Cross-functional management (CFM) managesbusinessprocessesacrossthe traditional
boundariesof the functional areas.
CFM relatestocoordinatingandsneeringthe activitiesof differentunitsforrealizingthe super
ordinate cross-functional goalsandpolicydeployment.
It isconcernedwithbuildingabettersystemforachievingforachievingsuchcrossfunctional
goalsas innovation,quality,cost,anddelivery.
public electronic commerce
EDI
global customers
EDI
public electronic commerce
Corporate secure
internet
managementsales
production
Customerservice
R&D
engineeringAccounting
and finance
Marketing& advertising
Globalsuppliers
The information
superhighwaybanks
firewall

MACROFORCES AND INTERNAL COMMERCE
Macro forcesand internal commerce highlightsthe changestakingplace inorganization
structure and exploreshowtechnologyandothereconomicforcesare moldingarrangements
withinfirms.
The commonfocusinmost of these modernmanagementparticlesisthe use of technologyfor
improvingefficiencyandeliminatingwasteful tasksinbusinessoperations.
Efficientoperationsof the macroforcesand internal commerce are:
Total qualitymanagement
Businessprocessimprovementorbusinessprocessreengineering.
The wordsimprovementandreengineeringare oftenusedinterchangeably,creating
confusion.
Althoughthe goal of these twoare same I.e.productivitygains,costsavings,qualityand
service improvements,cycle-time reduction.
One mainreasonfor reengineeringistobettercomplete inglobal markets. Global
Markets: Definition and Characteristics
Definition:
The OxfordUniversityPressdefines global marketing as“marketing”onaworldwide scale
reconcilingortakingcommercial advantage of global operationaldifferences,similaritiesand
opportunitiesinordertomeetglobal objectives.”
Global marketing:
Whena companybecomesaglobal marketer,itviewsthe worldasone marketandcreates
productsthat will onlyrequire weekstofitintoanyregional marketplace.Marketingdecisions
are made by consultingwithmarketersinall the countriesthatwill be affected.The goal isto
sell the same thingthe same wayeverywhere.
The Four elementsof global marketingof marketing:
Product:
A global companyisone that can create a single productandonlyhave totweakelementsfor
differentmarkets.Forexamplecoca-cola usestwoformulas(one withsugar,one withcorn
syrup) forall markets.
Price:

Price will alwaysvaryfrommarketto market.Price isaffectedbymanyvariables:costof
productdevelopment(producedlocallyorimported),costof ingredients,costof delivery
(transportation,tariffs,etc.),andmuchmore.
Placement:
How the product isdistributedisalsoacountry-by-countrydecisioninfluencedbyhow the
competitionisbeingofferedtothe targetmarket.UsingCoca-Colaas an example again,not
all culturesuse vendingmachines.
Promotion:
Afterproductresearch,developmentandcreation,promotionisgenerallythe largestline item
ina global company’smarketingbudget.Atthisstage of a company’sdevelopment,
integratedmarketingisthe goal.
The global corporationseekstoreduce costs,minimize redundanciesinpersonnel andwork,
maximize speedof implementation,andtospeakwithone voice. Global marketing Advantages
and Disadvantages
Advantages:
Economiesof scale inproductionanddistribution
Powerandscope
Consistencyinbrandimage
Abilitytoleveragegoodideasquicklyandefficiently
Uniformityof marketingpractices
Helpsto establishrelationshipsoutside of the "political arena“
Disadvantages:
Differencesinconsumerneeds,wants,andusage patternsforproducts
Differencesinconsumerresponse tomarketingmix elements.
Differencesinbrandandproduct developmentandthe competitive environment.
Differencesinadministrative proceduresandDifferencesinproductplacement.
Marketing Research:

It involvesthe identification,collection,analysis, and dissemination of information.Eachphase
of thisprocessisimportant.
Finally,the findings,implicationsandrecommendationsare providedinaformatthat allows
the informationtobe usedformanagementdecisionmakingandtobe acted upondirectly.
It shouldbe emphasizedthatmarketingresearchisconductedtoassistmanagementin
decisionmakingandisnot:a meansor an endin itself.
Marketing Research Characteristics:
First,marketingresearch is systematic.Thussystematicplanningisrequiredatall the stagesof
the marketingresearchprocess.
The proceduresfollowedateachstage are methodologicallysound,well documented,and,as
much as possible,plannedinadvance.
Marketingresearchusesthe scientificmethodinthatdata are collectedandanalyzedtotest
priornotionsor hypotheses.
Marketingresearchis objective.Itattemptstoprovide accurate informationthatreflectsatrue
state of affairs.Itshouldbe conductedimpartially.
An organizational structure isa mostlyhierarchical conceptof subordinationof entitiesthat
collaborate andcontribute toserve one commonaim.
Organizationsare a numberof clusteredentities.The structure of anorganization isusuallyset
up inone of a varietyof styles,dependentontheirobjectivesandambience.
Organizational structure allowsthe expressedallocationof responsibilitiesfordifferent
functionsandprocessestodifferententities.
Commonsuccesscriteriafororganizational structuresare:
-Decentralizedreporting
-Flathierarchy
-Hightransientspeed
-Hightransparency
Vertical Organization:

Hierarchicallystructuredorganizationwhere all managementactivitiesare controlledbya
centralizedmanagementstaff.
Vertical organizationhastwoproblems:
First,it createsboundariesthatdiscourage employeesindifferentdepartmentsfrom
interactingwithone another.
Second,departmental goalsare typicallysetinaway thatcouldcause frictionamong
departments.
A vertical marketisa groupof similarbusinessesandcustomerswhichengageintrade based
on specificandspecializedneeds.
An example of thissortof marketisthe marketfor point-of-saleterminals,whichare often
designedspecificallyforsimilarcustomersandare not available forpurchase tothe general
public.
A vertical marketisa marketwhichmeetsthe needsof aparticularindustry:forexample,a
piece of equipmentusedonlybysemiconductormanufacturers.Itisalsoknownasa niche
market.
Vertical marketsoftware issoftware aimedataddressingthe needsof anygivenbusiness
withinadiscerniblevertical market.
Horizontal organization:
A horizontal market isa marketwhichmeetsagivenneedof a wide varietyof industries,
rather thana specificone.
Examples
In technology,horizontal marketsconsistof customersthatshare a commonneedthatexistsin
manyor all industries.
For example,customersthatneedtopurchase computersecurityservicesorsoftware existin
such variedindustriesasfinance,healthcare,government,etc.
Horizontal marketingparticipantsoftenattempttomeetenoughof the differentneedsof
vertical marketstogaina presence inthe vertical market.
An example could be software that manages services in hotels - amenities solutions.
Vertical organization Comparison with horizontal organization:

A vertical marketisa marketwhichmeetsthe needsof aparticularindustry:forexample,a
piece of equipmentusedonlybysemiconductormanufacturers.
A horizontal marketisamarket whichmeetsagivenneedof awide varietyof industries,
rather thana specificone:forexample,wordprocessingsoftware.
Newforms of organizational structure:
Two newformsof organizational structuresare:
Prominent-virtual organizational structure:
In recentyears,virtual enterpriseshave gainedmuchattentionasmore and more firmsfrom
computerchipmanufacturingtoaircraft manufacturing.
Virtual organizationisdefinedasbeingcloselycoupledupstreamwithitssuppliersand
downstreamwithitscustomers.
Virtual organizationhasbeenvariouslyreferredtoas networkorganizations,organicnetworks,
hybridnetworksandvalue-addingpartnership.
Brokerages organizational structure:
The maingoal of electronicbrokeragesorganizationistoincrease the efficiencyof the internal
marketplace.
Internal marketsare beginningtoappearnotonlyincorporationsbuteveninnonbusiness
institutionslike the government.
Theyare createdinside organizations,allowingfirms,suppliers,governmentagenciesto
meetthe newchallengesof the fast-changingenvironment.
Types of electronic brokerages in internal markets:
internal markets
customer order
delivery
shipping
Logistics &
SCM
brokerages
Order
management
& financial
accounting
Production
brokerages
Manufacturing
planning and
scheduling
brokerages
Design
brokerages
customer
customer
customer
customer

E-COMMERCE 24
WORK FLOWAUTOMATION AND COORDINATION
In lastdecade,a visionof speedinguporautomatingroutine businesstaskshascome tobe
knownas “work-flow automation.
Thisvisionhasitsroot in the inventionof the assemblyline andthe applicationof Taylor's
scientificmanagementprinciples.
Today,a similartrendisemerginginthe automationof knowledge-basedbusinessprocesses
calledwork-flowautomation.
The goal of work-flowautomationistooffermore timely,cost-effective,andintegratedwaysto
make decisions.
Typically,work-flowsare decomposedintostepsortasks,whichare taskoriented.
Work-flowscanbe simple orcomplex.
Simple work-flowstypicallyinvolve one ortwostepsortasks.
Anotherwayof lookingatwork-flow istodetermine the amountof cross-functional activity.
In otherwords,companiesmustadoptanintegratedprocessview of all the businesselements
Organizational integrationisextremelycomplex andtypicallyinvolvesthree steps
Improvingexistingprocessesbyutilizingtechnologywhere appropriate.
Integrate acrossthe businessfunctionofferidentifyingthe informationneedsforeach
process.
Integratingbusinessfunctions,applicationprograminterface,anddatabase across
departmentsandgroups.
Complex work-flowsinvolve several otherwork-flows,some of whichExecutessimultaneously.
Work-FlowCoordination:
The keyelementof market-drivenbusinessisthe coordinationof tasksandotherresources
throughoutthe companyto create value forcustomer.
To thisend,effectivecompanieshave developedhorizontal structuresaroundsmall
multifunctional teamsthat canmove more quicklyandeasilythanbusinessesthatuse the
traditional function-by-function,sequential approach.

Some of the simplestwork-flow coordinationtoolsare electronicformsroutingapplications
such as lotusnotes.
As the numberof partiesinthe workflow increases,goodcoordinationbecomescrucial.
Work-flow related technologies:
Technologymustbe the “engine”fordrivingthe initiativestostreamline andtransform
businessinteractions.
Large organizationsare realizingthattheyhave a middle-managementofferall the drawn
sizingandreorganizationof fastfew years.
Pressuresformore comprehensivework-flowsystemsare buildingrapidly.
Work-flowsystemare limitedtofactorylike workprocess.
Middleware is maturing:
By thisusersor third-partyprovidersneedtolearnhow todevelopwork-flow applications
withinmiddlewareenvironment.
Organizational memory is becoming practical:
The newtoolsformemorybecomingadvancingtowardswhatcanbe calledthe
“corporate digital library”.
CUSTOMIZATION ANDINTERNAL COMMERCE
Technologyistransformingconsumerchoices,whichinturntransformthe dynamicsof the
marketplace andorganizationsthemselves.
Technologyembodiesadaptability,programmability,flexibility,andotherqualities so
essential forcustomization.
Customizationisexplainedas:

Mass customization,inmarketing,manufacturing,andmanagement,isthe use of flexible
computer-aidedmanufacturingsystemstoproduce customoutput.
Those systemscombine the lowunitcostsof massproductionprocesseswiththe flexibilityof
individualcustomization
"Mass Customization"isthe newfrontierinbusinesscompetitionforbothmanufacturingand
service industries.
Implementation:
Many implementationsof masscustomizationare operational today,suchassoftwarebased
productconfigurationswhichmake itpossible toaddand/orchange functionalitiesof acore
productor to buildfullycustomenclosuresfromscratch.
Companieswhichhave succeededwithmass-customizationbusinessmodelstendtosupply
purelyelectronicproducts.
However,these are nottrue "masscustomizers"inthe original sense,since theydonotoffer
an alternative tomassproductionof material goods.
Four types ofmass customization:
Collaborative customization- Firmstalkto individualcustomerstodeterminethe precise
productofferingthatbestservesthe customer'sneeds.
Adaptive customization- Firmsproduce a standardizedproduct, butthisproductis
customizable inthe handsof the end-user.
Transparent customization- Firmsprovide individualcustomerswithuniqueproducts,
withoutexplicitlytellingthemthatthe productsare customized.
Cosmetic customization- Firmsproduce a standardizedphysical product,butmarketitto
differentcustomersinuniqueways.
Most of the writtenmaterialsandthinkingaboutcustomizationhasneglectedtechnology. It
has beenaboutmanagementanddesignof workprocesses.
Today technologyissopervasive thatitisvirtuallyimpossible tomake cleardistributions
amongmanagement,designof work,andtechnologyinalmostall formsof businessand
industry.
Technologyhasmovedintoproducts,the workplace,andthe marketwithastonishingspeed
and thoroughness.

Mass customization,notmassproduction.
Today the wallsthatseparatedfunctionsinmanufacturingandservice industriesalikeare
beginningtofall like dominoes.
Customizationneednotbe usedonlyinthe productionof cars,planes,andothertraditional
products.
It can alsobe usedfortextilesandclothing.
Technologyisalsoenablingnew formsof customizedproductioninapparel industry.
What is Supply chain?
Consistsof all partiesinvolved,directlyorindirectlyinfulfillingacustomerrequest.
SUPPLY CHAIN MANAGEMENT (SCM)
Supply chain management (SCM) isthe managementof anetworkof interconnected
businessinvolvedinthe ultimateprovisionof productandservice packagesrequiredbyend
customers.
SupplyChainManagementspansall movementandstorage of raw materials,work-inprocess
inventory,andfinishedgoodsfrompoint-of-origintopoint-of-consumption.
SupplyChainManagementcanalsoreferto supplychainmanagementsoftware whichistools
or modulesusedinexecutingsupplychaintransactions,managingsupplierrelationshipsand
controllingassociatedbusinessprocesses.
The Management Components ofSCM
The literature onbusinessprocessre-engineering,buyer-supplierrelationships,andSCM
suggestsvariouspossible componentsthatmustreceive managerialattentionwhen
managingsupplyrelationships.
Lambertand Cooper(2000) identifiedthe followingcomponentswhich are:
-Planningandcontrol
-Work structure
-Organizationstructure

-Productflowfacilitystructure
-Informationflow facilitystructure
-Managementmethods
-Powerandleadershipstructure
-Riskand rewardstructure
-Culture andattitude
Reverse Supply Chain Reverse logisticsisthe processof planning,implementingand
controllingthe efficient,effective inboundflowandstorage of secondarygoodsandrelated
informationopposite tothe traditional supplychaindirectionforthe purpose of recovering
Unit-VI
THE CORPORATEDIGITAL LIBRARY
DIMENSIONSOFTHE INTERNALELECTRONIC COMMERCE SYSTEM
MARKETING A BUSINESSCASE FORA DOCUMENT LIBRARY
TYPES OFDIGITAL DOCUMENTS

ISSUES BEHIND DOCUMENT INFRASTRUCTURE
CORPORATEDATA WAREHOUSES
DIMENSIONS OF THE INTERNALELECTRONIC COMMERCE SYSTEM
These are the followingdimensionsforinternal electroniccommerce organization:
User modeling and interaction:
User modelsare interposingbetweenthe userinterface andinformationsourcestofilterthe
available informationaccordingtothe needsof the taskand user.
It associateswitheachtaskor eachpersonisa useragentor setof user agents.
Tasks of useragentsare:
- Maintainingof model &currentstate of the task
- Determiningof informationforeachstepof the task
- Appropriate combiningof informationwithuser.
Addressingthe issue of displayinginformationtothe user.
Consideringof wide range of displaydevices.
Determiningthe mostappropriate methodsfordisplay.
In thisuseragenttackle twoissues:
1. Generationof documents
2. Presentationof documents.
Effective utilization ofinformation
Organizationdecisionmakingcannotbe supportedwithasingle tool, asettechnologytoolsare
requiredforeffective utilizationof information.
Organizationneedsonline–transactionsfordesign,production,logisticsandprofitability.
Types ofOn-line transaction:
Two typesof on-line transactionare :
1. On-line transactionprocessing(OLTP).

2. On-line analytical processing(OLAP).
OLTP involvesthe detailed,day-to-dayproceduressuchasorderentry& ordermanagement.
OLAPrefersto the activityinvolvedinsearchingthe wealthof dataresidingthroughoutan
enterprise fortrends,opportunities.
Navigating the info sphere
It involvestwoelatedactivities:
- Informationsearch,discoveryandretrieval.
- Presentationof retrievedInformation.
Search, Discovery and Retrieval:
Thisviewischanging inthree ways.
1. Characterizationof accessibleinformation
2. Searchconceptsfrom thisinformation.
3. Developmentof informationfilter
Presentation or visualization:
It isusedfor easyunderstandingof information.
Organizationmustpredefine rulesforvisualization.
This processwill highlightthe trouble spotsandareaof opportunities.
Presentationincreasesthe fallowingtasksof information:
1. Accessingabilityof information.
2. Collectingof information.
3. Queue of information.
4. Organizingof information.
Digital Library Layer

Many organizationsmanage theirinformationthroughcorporate library,if itprovide the
architecture tomodel,map,integrate &informationindigitaldocumentsiscalleddigital
library.
It providesinformationstructuresbythisorganizations&workersaccessvastamountof data
encodedinmultimediaformats.
Digital librariesare of twotypes:
1. Electronicdocument-baseddigital libraries.
2. Data-base orientedwarehouses.
Document digital library:
The termdocumentisusedtodenote all nondata recordsI.e.books,reports,e-files,videos
and audios.
Digital libraryissimplyadistributednetworkof interlinkedinformation.
Data warehouses:
It isa central repositoryforcombiningandstoringvastamountof data fromdiff sources.
Sourcesare mainframe database,lint-serverdatabase,textreports….etc.
MAKING A BUSINESS CASE FOR DOCUMENT LIBRARY
Thissectionhighlightsthe role thatdocumentsplayintoday’sorganizationandhow business
can bettermeettheircustomers’needsbyimprovingdocumentmanagementsupport.
E-COMMERCE 14
Digital Document Management Issues and Concerns
Corporate
digital library
Accounting
and finance
Service and
supports
Manufacturing
and
production
R&D
engineering
Human
resources
Sales &
marketing
Logical cases
& contractsCustomers
&stake-holders
Documentation,
manuals,
records
Government
regulations

Ad hoc documents: Letters,finance reports,manualsare calledadhocdocuments,whichare
preparedbymanagers&professionals.
Process-specific documents:invoicesandpurchase orderswhichare created,constructedand
distributedbysupportpersonnel.theseare formbased.
Knowledge-oriented documents:these are technical documents,catalogsof product
information,anddesigndocuments.
Types ofDigital Documents
Four typesof digital documentsare:
Structuringapplicationsaroundadocumentinterface
Structuringinterlinkedtextual &multimediaDocuments.
Structuringand encodinginformationusingdocument-encodingstandards
Scanningdocumentsforstorage andfaxing.
Document Imaging
Documentimagingemulatesmicrofiche andmicrofilm.
An imagingsystempassesappeardocumentthroughascannerthat rendersitdigital andthen
storesthe digital dataas a bit-mappedimage of document.
The problemwiththe imagingapproachisthatthe outputcontainsonlyimagesnottext.
The followingimagingstandardsare prominentlyused:
TIFF (tagimage file format):formatforinterchange of bit-mappedimages.
ITU-TSS(international telecommunicationunion-telecommunicationstandardizationsector)
Group IV T.6 facsimile:thisstandardisusedforcompressionandexchange of bit-mapped
files.
Structured Documents
A structureddocumentprovidescleardescriptionof documentcontent.
Structureddocumentsapplydata-base structuringcapabilitiestoindividualdocumentsand
documentcollections.
Standardfor structureddocumentsare:
SGML (StandardGeneralizationMarkupLanguage):

It isan ISO standardfor interchange &multi formattingdescriptionof textdocumentinterms
of logical structure.
ODA(Office DocumentArchitecture):
It isan ANSI& ISOstandardfor interchange of compoundofficedocuments.ODAspecifiesboth
content& format.
CDA (CompoundDocumentArchitecture):
It definessetof rulesforcontentandformat.Itdefinesservicesforcompounddocuments.
RTF (Rich–TextFormat):
It isdevelopedbyMicrosoftforinterchangingof desktopdocuments.
Hyper Text Documents
Hypertextis a wayof makingdocument-basedinformationmore mobile.
Reasonsformobilityof informationare:
Informationinenterprisesisseldomlocatedonserverbutisdistributedthroughoutthe
organization.
Accessing&retrievinglarge monolithicdocumentistime consuming.
Reuse of documentforcomposingnew documentsisdifficulttask.
In thisrelationshipsbetweendocumentscanbe representedthroughhypermedialinksi.e.
hyperlinks.
Standards of Hypermedia:
HyTime:itadds time based relationshipslikesynchronization,itisextensionof SGML.
HTML: developedbyWWW to supportdistributedhypermedia.
MHEG(multimedia/hypermediaencoding/exportingGroup):standardforpresentingobjectsin
multimedia
Active documents
Active documentrepresentswhatisknownasdocumentorientedcomputing.
Active documentprovide aninteractive interfacebetweendocuments.

Active documentsare especiallypowerful because theycombine compositionof information
withthe distributednature of information.
Ex: spreadsheet,word-processing..etc
Issues behind Document Infrastructure
Documentinfrastructure addressedthesequestions:
What is the properarchitecture forthe corporate digital library?
What are appropriate model?
What protocolsrequired?
What are the besthumaninterfaces?
How doesone representandmanipulate the informationprocessingactivitiesoccurredinthe
digital library?
Document Constituencies:
The emergingdocumentprocessing& managementstrategiesmustaddressthese
constituencies.
Theyneedsystemtoaccessdistributedrepositories&tomanipulate theminanumberof ways.
Document-oriented processes
Componentsof Document-orientedprocessesare:
Documentcreation
Documentmediaconversation(itacceptmultipleformsof input)
Documentproductionanddistribution
Documentstorage and retrieval
Document-based framework flows:
The followingFouractivitiesmake upthe document-basedframeworkflow:
Document modeling:itdefinesthe structure andprocessesthe document.
Transformation: createsmodulesforcapturingandvalidating.

Synthesizing: create value-addedinformationfromthe combinationof twoormore
documents.
Business modeling:definesthe structure andprocessesof the businessenvironment.
Corporate Data Warehouses
Architectureofthedata warehouse is as fallows:
E-COMMERCE 27
Data warehouse isusedstore informationof the organization.
Data warehouse isneededasenterprise wide toincrease datainvolume andcomplexity.
Characteristics ofdata warehouse are:
An information-basedapproachtodecisionmaking.
Involvementinhighlycompetitive &rapidlychangingmarkets.
Data stored in manysystemsandrepresenteddifferently.
Functions performed by data warehouse are:
Allowexistingtransactionsandlegacysystemstocontinue inoperation.
Consolidatesdatafromvarioustransactionsystemsintoacoherentset.
Allowsanalysisof virtual informationaboutcurrentoperationsof decisionsupport.
Types ofdata warehouses
There are fourtypesof data warehouses:
Physical data warehouse:Itgatherscorporate dataalong withthe schemasandthe processing
logics.
Logical data warehouse: Itcontainsall the Metadata and businessrules.
Corporate data
warehouse
Data migration
from operational
database
Data replicated
from operational
database
Middleware for
data access
clients clients
Query monitors
search and
retrieval

Data library: Thisis subset of the enterprise widedatawarehouse.
Decision support system (DSS): These are the applicationsbutmake use of data warehouse
Managing data
To manage data fallowing steps are needed:
Translation
Summarizing
Packaging
Distributing
Garbage collection
Advantages ofdata warehouse:
Timelyandaccurate informationbecome anintegral partof the decision-makingprocess.
User can manage and access large volumesof inone cohesiveframework.
Data warehousinghaswide spreadapplicability.
It providespoint-of-salesreportsinsteadof end-of –dayreports.
Advertising and Marketing on the Internet The new
age of information-basedmarketing.
Advertisingonthe internet.
Marketingresearch.
The NewAge ofInformation-Based Marketing
The newage of information-basedmarketingdifferentiate interactive marketingintofourareas:
Retailersvsmanufacturers
Target and micromarketing
Small businessvslarge business
Regulatoryandlegal implicationsof cyberspace marketing.
Retailers’ vs Manufacturers:
The role of Retailersandmanufacturersare fastreversinginelectroniccommerce.

Retailer’s vs Manufacturers have the fallowing methods:
Market researchand customerprospecting.
Market presence method
Productor servicesbuildingmethod
Information-basedproductspricingandprioritymethod.
Target and Micromarketing:
Electroniccommerce,technologyhasputtargetand micromarketingwithinthe researchof
small business.
It givesinformationtothe micromarketersnotonlyaboutits ownbusinessbutalso
consumer’sinformation.
Consumertargetistwo-wayflowof communicationbetweensellerandbuyer.
Directmail and telemarketingare twofastgrowingwaystomicro market.
Technologyisanessential tool inmicromarketing.
There are two main types ofmicromarketing:
Direct-relationshipmicromarketing:isaimedatstimulatingsalesatretail establishments
throughdirectcontacts withconsumers.
Direct-ordermicromarketing:isfocusedonsellingproductsdirectlytoconsumersintheir
homesor businesses.
Small vs large: Thread avoid vs goliath syndrome
The keydistinctionbetweensmall andlarge businessremainsaccesstonational and
international marketingforadvertisingpurposes.
Today,exorbitantadvertisingcostrepresentsthe barriertoreachingthe customereffectively.
Internetandothernetworksplaysgoodrole inadvertising.
The majordifference betweenthe internetandotherI-wayadvertisingmediaare ownership
and membershipfees.
Due to the empoweringeffectof internet-facilitatedadvertisinghowever,the balance of
powerbetweenlarge andsmall companiesmaychange infuture.
Advertising on the Internet

The notionof advertisingandmarketingbecame inevitable after1991 whenthe internetwas
openedforcommercial traffic.
There are verygood reasonsforembracingthe inevitabilityof growingof commercial
advertisingonthe internet:
- Advertisingconveysmuchneededinformation
- Advertisinggeneratessignificantrevenue
Key components for making internet advertising effectively are:
Advertisingprocess
Core content
Supportingcontent
Market and consumerresearch
Repeatcustomers
On-line advertising paradigms:
Twodifferentadvertisingparadigmsare emerginginthe on-line world,theyare:
1. Active orpush-basedadvertising
2. Passive orpull-basedadvertising
Active or push-based advertising:
Active orpush-basedadvertisingisof twotypestheyare :
The broadcast model:
Broadcastingmessage providesameansforreachinga greatnumberof people inshortperiod
of time.
It mimicsthe traditional model,inwhichcustomeridexposedtothe advertisementduringTV
programming.
It basicallyusesdirectmail,spottelevision,cable television.
Text-basedbroadcastmessagesalsousedinadvertisinginUsenetnewsgroups.
The junkmail model:
Disadvantage of the directmail include relativelyhighcostpercontact.

Junkmail isthe justpoorlytargeteddirectmail.
It ismost intrusive of all formsof internetadvertising,because itiseasilyimplementedusing
electronicmail.
Junkmail createsunwantedexpense aswellasan annoyance.
Passive or pull-based advertising
Pull-basedadvertisingprovideafeedbackloop,companyandcustomers.
On-line pull-basedadvertisingincludesthe following:
Billboards
Catalogs or yellowpagesdirectories:
endorsements
Basedon the above three we have the fallowingmodels:
The billboards or www model:
Billboardadvertisingisoftenusedtoremindthe customerof the advertisingmessages
communicatedthroughothermedia.
The advantage of thismodel isnocustomercharges.
In thismessage mustbe simple,direct.
Catalog and yellowpages directory model:
Traditionally,the mostvisible directoryserviceof advertisingisthe yellow pages.
Catalogmodel isthe leastintrusive model butrequiresactive searchonthe part of customer.
Yellowpagesare lowincost intermsof productionandplacement.
Disadvantage of yellow page includelackof timelinessandlittle creative flexibility.
Customer endorsement model:
In endorsementspeople tell theirexperienceswithproductsandservices.
These are in questionandanswerformat.
Marketing Research

Market researchisextremelyimportantforcompaniesintermsof how theyallocate their
advertisingdollarsinsalespromotions,how theyintroduce new products,how theytarget
newmarkets.
Broadlymarketingresearchisdividedintothree faces:
Data collection
Data organization
Data analysisandsense making
Data collection:
Markets mainlyreliedonsource database forunderstandingconsumerbehavior.
Source data base mainlycomprise of numericinformation.
Deliveryof source database servicesfallowstwomainpatterns.
Data collectand collate data,makingitavailable bydatabase producers.
Data collectand collate data,makingitavailable bycentral hostslike CompuServe,American
online..etc.
Data organization:
Everyone iscollectingdatafromelectroniccommerce,butveryfew are organizingiteffectively
for developingamarketingstrategy.
The keyabilitiesintheirenvironmentare:
Leverage itsestablisheddatabaseintocustomizedofferings byaudience andmarkets.
Leverage itsestablisheddatabase intermsof horizontal growth.
Data analysis and sense making:
The abilitytolinkdatabase toanalytictoolslike econometricprogramsandforecastingmodels
iscalleddata analysis.
Market researchisundergoingmajorchanges;the nextgenerationof source database will
definitelyincludemultimediainformation.

Unit-VII
SEARCH AND RESOURCE DISCOVERYPARADIGMS
Three informationsearchandresource discoveryparadigmsare inuse:
Informationsearchandretrieval Electronic
directories&catalogs.
Informationfiltering.
Information search and retrieval:
Searchand retrieval beginswhenauserprovidesadescriptionof the informationbeingtoan
automateddiscoverysystem.
Using the knowledgeof the environment,the systemattemptstolocate the informationthat
matchesthe givendescription.
An informationretrievalmethoddependsonthe libraries.
The challenge istodevelopuserindomainssuchaselectronicshopping.
Searchand retrieval methodsthatrefinequeriesthroughvariouscomputingtechniquessuch
as nearestneighbors,themvariantsof original query.
Electronic catalogs and directories:

Informationorganizing and browsing is accomplished using directories or catalogs‘ Organizing
refers to how to interrelate information, by placing it in some hierarchy.
Maintaininglarge amountof data isdifficult.
Information filtering:
Goal of informationfilteringif selectingof datathat is relevant,manageableand
understandable.
Filtersare of two types
1. Local filter
2. Remote filter
Local filters:local filtersworkonincomingdatatoa PC,such as newsfeeds.
Remote filters:remotefiltersare oftensoftware agentsthatworkonbehalf of the userand
roam aroundthe networkfromone data base to another.
CONSUMER SEARCH AND RETRIVAL
SEARCH ANDRESOURCE DISCOVERY PARADIGMS
INFORMATION SEARCHANDRETRIEVAL
ELECTRONIC COMMERCE CATALOGSOR DIRECTORIES
INFORMATION FILTERING
INFORMATIONSEARCH AND RETRIEVAL
Informationsearchissiftingthroughlarge volumesof informationtofindsome target
information.
Search& retrieval systemare designedforunstructured&semi structural data.
The processof searchingcan be dividedintotwotypes:
The end-user retrieval phases: consistsof three steps
Firstis,the userformulatesatextbasedquerytosearchdata.
Secondis,the serverinterpretsusers query,performsthe searchandreturnsthe usera listof
documents.

Thirdis, the userselectsdocumentsfromthe hitlistandbrowsesthem, readingandperhaps
printingselectedportionsof retrieveddata.
.
The publisher indexing phase:
It consistsof enteringdocumentsintothe systemandcreatingindexesandpointersto
facilitate subsequentsearches.
The processof loadingadocumentand updatingindexesisnormallynotaconcernto the user.
These twophasesare highlyinterdependent
WAIS (Wide Area Information Service):
It enablesuserstosearchthe contentof the filesforanystringof textthat theysupply.
WAIShas three elements:
Client
Sever
Indexer
It usesan Englishlanguage queryfrontendalarge assortmentof data basesthatcontains
textbaseddocuments.
It allowsuserssearchthe full textof all the documentsonthe server.
Users ondiff platformscanaccess personal,company,andpublishedinformationfromone
interface I.e.text,picture,voice,orformatteddocument.
Anyone canuse thissystembecause itusesnatural language questionstofindrelevant
documents.
Thenthe serverstake the userquestionsanddotheirbesttofindrelevantdocuments.
ThenWAIS returnsa listof documentsfromthose usersselectsappropriate documents.
Today,the Netscape orNCSA mosaicbrowserwiththe formscapabilityisoftenusedasafront-
endto talkto WIAS sever.
Search Engines:
WAISis a sophisticatedsearchengine.

The purpose of the searchengine inanyindexingsystemissimple
To findeveryitemthatmatchesa query,nomatterwhere itis locatedinthe file system.
Searchenginesare nowbeingdesignedtogobeyondsimple,broadband
SearchesforwhichWIASis so popular.
It usesbothkeywordsandinformationsearchingtorankthe relevance of eachdocument.
Otherapproachesto data searchingonthe webor on otherwide areanetworksare available.
Indexing methods:
To accomplishaccuracyand conserve diskspace,twotypesof indexingmethodsare usedby
searchengines.
Theyare:
1. File-level indexing
2. Word-level indexing
File-level indexing:
It associateseachindexedwordwithalistof all filesinwhichthatwordappear at leastonce.
It doesnotcarry any informationaboutthe locationof wordswithinthe file.
Word-level indexing:
It ismore sophisticatedandstoresthe locationof eachinstance of the word.
The disadvantage of the word-level indexingisthatall the extrainformationtheycontain
gobblesupa lotof diskspace,itis 35-100 percentof the original data.
The processof indexingdataissimple one ,it haslarge numberof indexingpackages:
These indexingpackagesare categorizedintothreetypes,theyare:
1. The client-serverapproach
2. The mainframe-basedapproach 3. The parallel-processing
approach
Search and newdata types:
We have the followingsearchtechnologiesforeffective search:

Hypertext:richlyinterwovenlinksamongitemsindisplaysallowuserstomove inrelativelyadhoc
sequencesfromdisplaytodisplaywithinmultimedia.
Sound: speechinputandoutput,musicandwide varietyof acousticcuesinclude realisticsoundsthat
supplementandreplace visual communication.
Video:analogare digital videoinputfrommultiple media,includingvideotapes,CD-ROM,
incorporatedbroadcastvideosturners,cablesandsatellites.
3D-images:virtual realitydisplaysoffera3D environmentinwhichall portions of the userinterface
are 3D.
Searchingusingthese newtypesof informationposesinterestingchallengesthatneedtobe
addressedsoon.
WwwRobots,wanderer,andSpiders
Robots,Wanderer,AndSpidersare all programsthat traverse the www automatically
gatheringinformation.
ELECTRONIC COMMERCE CATALOGS OR DIRECTORIES
A directoryperformsanessentialsupportfunctionthatguidescustomersinamaze of options
by enablingthe organizationsof the informationspace.
Directoriesare of twotypes:
1. The white pages
2. Yellowpages
The white pagesare usedto people orinstitutionsandyellow pagesare usedtoconsumers
and organizations.
Electronic white pages:
Analoguestothe telephone white pages,the electronicwhite pagesprovide servicesfroma
staticlistingof e-mail addressestodirectoryassistance.
White pagesdirectories,alsofoundwithinorganizations,are integral toworkefficiency.
The problemsfacingorganizationsare similartothe problemsfacingindividuals.
A white pages schemaisadata model,specificallyalogical schema,fororganizingthe data
containedinentriesinadirectoryservice,database,orapplication,suchasan addressbook.
A white pagesschematypicallydefines,foreachreal-worldobjectbeingrepresented:

What attributesof that objectare to be representedinthe entryforthatobject.
What relationshipsof thatobjecttootherobjectsare to be represented?
One of the earliestattemptstostandardize awhite pagesschemaforelectronicmail use wasin
X.520 and X.521, part of the X.500 a specificationthatwasderivedfromthe addressing
requirementsof X.400.
In a white pagesdirectory,eachentrytypicallyrepresentsanindividual personthatmakesthe
use of networkresources,suchasbyreceivingemail orhavinganaccountto log intoa
system.
In some environments,the schemamayalsoinclude the representationof organizational
divisions,roles, groups,anddevices.
The termisderivedfromthe white pages,the listingof individualsinatelephone directory,
typicallysortedbythe individual'shome location(e.g.city) andthenbytheirname.
White pages through x.500:
One of the firstgoal of the X.500 projecthas beentocreate a directoryforkeepingtrackof
individualelectronicmail addressonthe internet. X.500 offersthe followingfeatures:
-Decentralizedmaintenance
-Each site runningx.500 isresponsible onlyforitslocal part of the directory.
Searching capabilities:x.500providespowerful searchingcapabilitiesi.e.inthe white pages;you
can search solelyforusersinone country.Fromthere youcan view a list of organizations,then
departments,thenindividualnames.
Thisrepresentsthe tree structure.
Single global name space:x.500providessinglename space tousers.
Structured information framework: X.500 definesthe informationframeworkusedinthe
directory,allowinglocal extensions.
Standards-based directory:X.500 can be usedto builddirectoryapplicationsthatrequires
distributedinformation.
Lecture 4

WHITE PAGES DIRECTORY INFORMATION TREE
E-COMMERCE 28
ELECTRONIC YELLOWPAGES:
The termYellow Pages referstoatelephone directoryof businesses,categorizedaccordingto
the product or service provided.
The traditional term Yellow Pages isnow alsoappliedtoonlinedirectoriesof businesses.
To avoidthe increasingcostof yellow paper,the yellow backgroundof the pagesiscurrently
printedonwhite paperusingink.Yellowpaperisnolongerused.
The name andconceptof "YellowPages"came aboutin1883, whenaprinterinCheyenne,
Wyomingworkingona regulartelephone directoryranoutof white paperandusedyellow
paperinstead.
In 1886 ReubenH.Donnelleycreatedthe firstofficial yellow pagesdirectory,inventingan
industry.
Today,the expression Yellow Pages isusedglobally,inbothEnglish-speakingandnonEnglish
speakingcountries.
In the US, it referstothe category,while insome othercountriesitisa registeredname
and therefore apropernoun.
Third-party directories can be categorized variously:
Basic yellowpages: These are organizedbyhuman-orientedproductsandservices.
Business directories:Thistakesthe extendedinformationaboutcompanies,financialhealth,
and newsclippings.
State business directories:thistype of directoryisusefulinbusinessesthatoperate ona state
or geographicbasis.
o
U.K Fr. U.S
a b c d e f g h I
j k
Root
Countries
individuals
Organizations

Directories by SIC :( standardindustrial classification) directoriesare compiledbythe
government.
Manufacturer’s directories:if yourgoal isto sell yourproductor service tomanufacturers,
thenthistype of directoryisused.
Big-businessdirectory: Thisdirectorylistscompaniesof 100 or more employees.
Metropolitan area businessdirectory:Itdevelopssalesandmarketingtoolsforspecificcities.
Credit reference directory:thisdirectoryprovidescreditratingcodesformillionsof US
companies.
World Wide Web directory:thislists the varioushyperlinksof the variousserversscattered
aroundthe internet.
INFORMATIONFILTERING
An Information filtering systemisa systemthatremovesredundantorunwantedinformation
froman informationstreamusing(semi)automatedorcomputerizedmethodspriorto
presentationtoahumanuser.
Its maingoal is the managementof the informationoverloadandincrementof the semantic
signal-to-noise ratio.Todothisthe user's profile iscomparedtosome reference
characteristics.
A notable applicationcanbe foundinthe fieldof email spamfilters.
Thus,it isnot onlythe informationexplosionthatnecessitatessome formof filters,butalso
inadvertentlyormaliciouslyintroducedpseudo-information.
On the presentationlevel,informationfilteringtakesthe formof user-preferences-based
newsfeeds,etc.
Recommendersystemsare active informationfilteringsystemsthatattempttopresenttothe
userinformationitems(movies,music,books,news,webpage)the userisinterestedin.
Informationfilteringdescribesavarietyof processesinvolvingthe deliveryof
informationtopeople whoneedit.
Thistechnologyisneededasthe rapidaccumulationof informationinelectronicdatabases.
Informationfilteringisneededine-mails,multimediadistributedsystemandelectronicoffice
documents.
The featuresof the informationfilteringare:

Filteringsystemsinvolveslarge amountsof data(gigabitsof text).
Filteringtypicallyinvolvesstreamsof incomingdata,eitherbeingbroadcastbyremote sources
or sentdirectlybyothersourceslike e-mails.
Filteringhasalsobeenusedtodescribe the processof accessingandretrievinginformation
fromremote database.
Filteringisbasedondescriptionsof individual orgroupinformationpreferences,oftencalled
profiles.
Filteringsystemdealprimarilywithtextual information.
Email filtering:
It is the processingof e-mail toorganize itaccordingtospecifiedcriteria.
Most oftenthisreferstothe automaticprocessingof incomingmessages,butthe termalso
appliestothe interventionof humanintelligence inadditiontoanti-spamtechniques,andto
outgoingemailsaswell asthose beingreceived.
Email filteringsoftware inputsemail.
For itsoutput,it mightpassthe message throughunchangedfordeliverytothe user'smailbox,
redirectthe message fordeliveryelsewhere,oreventhrow the message away.
Some mail filtersare able toeditmessagesduringprocessing.
Commonusesfor mail filtersinclude removal of spamandof computerviruses.
A lesscommonuse isto inspectingoutgoinge-mail atsome companiestoensure that
employeescomplywithappropriate laws.
Users mightalsoemployamail filtertoprioritize messages,andtosort themintofoldersbased
on subjectmatteror othercriteria
Mail-filtering agents:
Users of mailing-filteringagentscaninstructthemtowatch foritemsof interestine-mail in-
boxes,on-line newsservices,electronicdiscussionforums,andthe like.
The mail agentwill pull the relevantinformationandputitinthe userspersonalized
newspapersatpredeterminedintervals.
Example of Apple’sApple Searchsoftware.Mail filterscanbe installedbythe user,eitheras
separate programs(see linksbelow),oraspart of theire-mail program(e-mail client).

In e-mail programs,userscanmake personal,"manual"filtersthatthenautomaticallyfilter
mail accordingto the chosencriteria.
Most e-mail programsnowalsohave anautomaticspam filteringfunction.
Internetservice providerscanalsoinstall mail filtersintheirmail transferagentsasaservice to
all of theircustomers.Corporationsoftenuse themtoprotect theiremployeesandtheir
informationtechnologyassets.
News-filtering agents:
These deliverreal-time on-line news.
Users can indicate topicsof interest,andthe agentwill alertthemtonewsstoriesonthose
topicsas theyappearon the newswire.
Users can alsocreate personalizednewsclippingreportsbyselectingfromnewsservices.
Consumerscanretrieve theirnewsfromthroughthe deliverychannel of theirchoice like fax,e-
mail,wwwpage,orlotusnotesplatform.

Unit-VIII
MULTIMEDIA ANDDIGITAL VIDEO
KEY MULTIMEDIA CONCEPTS
DIGITAL VIDEOANDELECTRONIC COMMERCE
DESKTOPVIDEO PROCESSING
DESKTOPVIDEO CONFERENCING
KEYMULTIMEDIA CONCEPTS
Multimedia:the use of digital datain more than one format,suchas the combinationof text,
audioand image datain a computerfile.
The theorybehindmultimediaisdigitizingtraditional medialikewords,sounds,motionand
mixingthemtogetherwithelementsof database.
Multimedia data compression:
Data compressionattemptstopackas much informationaspossibleintoagivenamountof
storage.The range of compressionis2:1 to 200:1.
Compression Methods:
Sector-oriented disk compression (integratedintothe operatingsystem, thiscompressionis
invisible toenduser)
Backup or archive-oriented compression(Compressfilebeforetheyare downloadedover
telephonelines)
Graphic & video-oriented compression(Compressgraphics&videofilebefore theyare
downloaded)
Compression ofdata being transmitted over low-speed network(techusedinmodems,
routers)
Data compression in action:
Data compressionworksbyeliminatingredundancy.
In general ablockof textdata containing1000 bitsmayhave an underlyinginformation
contentof 100 bits,remainingisthe white space.
The goal of compressionistomake the size of the 1000-bit to 100-bit (size of underlying
information).thisisalsoapplicable toaudioandvideofilesalso.

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