Table Of ContentAn imprint of
www.pearson-books.com
E-BusinEss and
E-CommErCE
managEmEnt
davE ChaffEy
Strategy, ImplementatIon and practIce
Fourth edition
E-BusinEss and
E-CommErCE managEmEnt
ChaffEy
Fourth
edition
What approach to e-business strategy should you follow? how much do you need to
invest in e-business? Which processes should be your priorities?
Written in an engaging and informative style, E-Business and E-Commerce Management explores these
questions, equipping you with the knowledge and skills to navigate today’s fast-paced world of continuous
technological development.
In this latest edition of his bestselling text, leading authority Dave Chaffey brings together the latest academic
thinking and professional practice. Covering all aspects of e-business including strategy, digital marketing and
supply chain management, E-Business and E-Commerce Management gives you the benefit of:
• A structured approach to planning, implementing, assessing and improving
e-business strategy for all types of organization.
• The latest on managing e-business security and cutting edge e-marketing
techniques such as social media and search engine optimization.
• Case studies of technology leaders such as Dell, Facebook and Google,
as well as start-ups and small businesses.
• Real-life interviews with professionals who describe their e-business strategies.
Whether you’re an undergraduate or postgraduate student studying e-business and e-commerce, or
a business manager, E-Business and E-Commerce Management is the essential text to help you keep
pace with technology, strategy and implementation.
dave Chaffey (www.davechaffey.com) is an e-business consultant and visiting lecturer on e-business
courses at Warwick University and Cranfield School of Management.
‘this book keeps getting better and better with every version. It is fast
becoming the de facto standard for e-business and e-commerce – for
both faculty and students.’
Ben Clegg, aston Business school
‘this text provides a strong strategic framework to help
students understand this fast-moving subject, as well as
a useful guide to practical analysis.’
mette Præst Knudsen, university of southern denmark
Additional learning resources are online at
www.pearsoned.co.uk/chaffey
CVR_CHAFF9601_04_SE_CVR.indd 1
8/4/09 09:31:49
E-Business and
E-Commerce
Management
Strategy, Implementation and Practice
Visit the E-Business and E-Commerce Management, fourth edition Companion Website at
www.pearsoned.co.uk/chaffey to find valuable student learning material including:
� A study guide to reinforce key ideas and topics
� Multiple choice questions to test your learning
� Links to relevant sites on the web
� An online glossary to explain key terms
� Flashcards to test your understanding of key terms
� A smarter online searching guide
� Link to Dave Chaffey’s blog with a collection of articles and links
� Link to Dave Chaffey’s Twitter feed
A01_CHAF9601_04_SE_FM.QXD:D01_CHAF7409_04_SE_C01.QXD 16/4/09 15:29 Page i
We work with leading authors to develop the
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A01_CHAF9601_04_SE_FM.QXD:D01_CHAF7409_04_SE_C01.QXD 16/4/09 10:59 Page ii
STRATEGY, IMPLEMENTATION AND PRACTICE
Dave Chaffey
Fourth Edition
E-BUSINESS AND
E-COMMERCE
MANAGEMENT
A01_CHAF9601_04_SE_FM.QXD:D01_CHAF7409_04_SE_C01.QXD 16/4/09 10:59 Page iii
Pearson Education Limited
Edinburgh Gate
Harlow
Essex CM20 2JE
England
and Associated Companies throughout the world
Visit us on the World Wide Web at:
www.pearsoned.co.uk
First published 2002
Second edition published 2004
Third edition published 2007
Fourth edition published 2009
© Dave Chaffey 2002
© Marketing Insights Limited 2002, 2009
The right of Dave Chaffey to be identified as author of this work has
been asserted by him in accordance with the Copyright, Designs and Patents Act 1988.
All rights reserved. No part of this publication may be reproduced, stored in a retrieval
system, or transmitted in any form or by any means, electronic, mechanical,
photocopying, recording or otherwise, without either the prior written permission of the
publisher or a licence permitting restricted copying in the United Kingdom issued by the
Copyright Licensing Agency Ltd, Saffron House, 6–10 Kirby Street, London EC1N 8TS.
All trademarks used herein are the property of their respective owners. The use of any
trademark in this text does not vest in the author or publisher any trademark ownership rights
in such trademarks, nor does the use of such trademarks imply any affiliation with or
endorsement of this book by such owners.
ISBN: 978-0-273-71960-1
British Library Cataloguing-in-Publication Data
A catalogue record for this book is available from the British Library
Library of Congress Cataloging-in-Publication Data
Chaffey, Dave, 1963–
E-business and e-commerce management : strategy, implementation, and
practice / Dave Chaffey. -- 4th ed.
p. cm.
Includes bibliographical references and index.
ISBN 978-0-273-71960-1 (pbk. : alk. paper) 1. Electronic commerce.
2. Business enterprises--Computer networks. I. Title. II. Title:
Ebusiness and ecommerce management.
HF5548.32.C472 2009
658.8'72--dc22
2009009561
10 9 8 7 6 5 4 3 2 1
13 12 11 10 09
Typeset in 10/12pt Minion by 30
Printed and bound by Rotolito Lombarda, Italy
The publisher’s policy is to use paper manufactured from sustainable forests.
A01_CHAF9601_04_SE_FM.QXD:D01_CHAF7409_04_SE_C01.QXD 16/4/09 10:59 Page iv
Preface
xiii
Guided tour
xxiv
Author’s acknowledgements
xxvi
Publishers acknowledgements
xxvii
1 Introduction to e-business and e-commerce
3
2 E-commerce fundamentals
51
3 E-business infrastructure
103
4 E-environment
192
5 E-business strategy
255
6 Supply chain management
330
7 E-procurement
380
8 E-marketing
412
9 Customer relationship management
481
10 Change management
560
11 Analysis and design
604
12 Implementation and maintenance
680
Glossary
736
Index
754
Implementation
559
Part 3
Strategy and applications
253
Part 2
Introduction
1
Brief contents
Part 1
A01_CHAF9601_04_SE_FM.QXD:D01_CHAF7409_04_SE_C01.QXD 16/4/09 10:59 Page v
A01_CHAF9601_04_SE_FM.QXD:D01_CHAF7409_04_SE_C01.QXD 16/4/09 10:59 Page vi
Preface
xiii
Guided tour
xxiv
About the author
xxvi
Author’s acknowledgements
xxvii
Publisher’s acknowledgements
xxvii
1
Introduction to e-business and e-commerce
3
Learning outcomes / Management issues
3
Links to other chapters
3
Introduction
4
The impact of the electronic communications on
traditional businesses
6
Real-world E-Business: HP.com
7
What is the difference between e-commerce and
e-business?
9
E-commerce defined
10
E-business defined
13
Case Study 1.1 A short history of Facebook
17
Business or consumer models of e-commerce
transactions
26
E-business opportunities
29
Business adoption of digital technologies for
e-commerce and e-business
30
Drivers of business Internet adoption
30
Case Study 1.2 North West Supplies extends its
reach online
33
E-business risks and barriers to business adoption
35
Evaluating an organization’s e-business capabilities 36
Drivers of consumer Internet adoption
37
Barriers to consumer Internet adoption
39
Management responses to e-commerce and
e-business
39
Part 1: Introduction
39
Part 2: Strategy and applications
40
Part 3: Implementation
42
Case Study 1.3 eBay – the world’s largest
e-business
42
Summary
46
Exercises
46
References
48
Further reading
49
Web links
49
2
E-commerce fundamentals
51
Learning outcomes / Management issues
51
Links to other chapters
51
Introduction
52
Real-world E-Business: More Th>n
53
The e-commerce environment
57
Strategic agility
57
Online marketplace analysis
59
Location of trading in the marketplace
67
The importance of multi-channel marketplace
models
70
Different types of online intermediary
71
Types of intermediaries
74
The importance of search engines
76
Business models for e-commerce
77
Revenue models
79
Online publisher and intermediary revenue models
80
Focus on auction business models
86
Case Study 2.1 The impact of B2B reverse
auctions
87
Focus on Internet start-up companies
88
From ‘bricks and mortar’ to ‘clicks and mortar’
88
Assessing e-businesses
89
Valuing Internet start-ups
89
Case Study 2.2 lastminute.com – an international
dot-com survivor
91
The dot-com bubble bursts
93
Why dot-coms failed
93
The impact of the dot-com phenomenon on
traditional organizations
95
Case Study 2.3 Zopa launches a new lending
model
95
Summary
98
Exercises
99
References
100
Further reading
101
Web links
101
3
E-business infrastructure
103
Learning outcomes / Management issues
103
Links to other chapters
103
Introduction
104
E-business infrastructure components
105
Real-world E-Business: Random House
107
Internet technology
109
Hosting of web sites and e-business services
110
The Internet timeline
111
Just how big is the Internet?
114
Case Study 3.1 Innovation at Google
115
Intranets and extranets
116
Web technology
124
Internet-access software applications
128
Blogs and blogging
129
Electronic mail or e-mail
131
Feeds
132
Voice over IP (VoIP)
134
Part 1
Introduction
1
Contents
A01_CHAF9601_04_SE_FM.QXD:D01_CHAF7409_04_SE_C01.QXD 16/4/09 10:59 Page vii
How does it work? Internet standards
136
Networking standards
136
The HTTP protocol
138
Uniform resource locators (URLs)
139
Domain names
139
Web presentation and data exchange standards
141
Audio and video standards
152
Focus on Internet governance
152
Managing e-business infrastructure
158
Managing hardware and systems software
infrastructure
159
Managing Internet service and hosting providers
160
Managing employee access to the Internet and
e-mail
165
Managing e-business applications infrastructure
165
Focus on web services, SaaS and service-oriented
architecture (SOA)
168
Benefits of web services or SaaS
168
Challenges of deploying SaaS
169
Case Study 3.2 New architecture or just new
hype?
174
EDI
176
Focus on mobile commerce
177
Wireless Internet access standards
178
Wireless access devices
179
Popularity of mobile applications
179
Summary
186
Exercises
187
References
188
Further reading
190
Web links
190
4
E-environment
192
Learning outcomes / Management issues
192
Links to other chapters
192
Introduction
193
Real-world E-Business: GD Worldwide
196
Social and legal factors
198
Factors governing e-commerce service adoption
198
Privacy and trust in e-commerce
209
Other e-commerce legislation
222
Environmental and green issues related to Internet
usage
227
Taxation
229
Freedom-restrictive legislation
231
Economic and competitive factors
232
Focus on e-commerce and globalization
233
Case Study 4.1 The implications of globalization
for consumer attitudes
235
The implications of e-commerce for international
B2B trading
236
Political factors
238
Internet governance
239
E-government
240
Technological innovation and technology assessment
241
Approaches to identifying emerging technology
244
Summary
246
Exercises
246
References
247
Further reading
249
Web links
249
5
E-business strategy
255
Learning outcomes / Management issues
255
Links to other chapters
255
Introduction
256
Real-world E-Business: Standard Life
256
What is e-business strategy?
259
The imperative for e-business strategy
261
E-channel strategies
262
Strategy process models for e-business
264
Strategic analysis
269
Resource and process analysis
269
Competitive environment analysis
276
Assessing competitive threats
276
Co-opetion
281
Competitor analysis
281
Strategic objectives
281
Defining vision and mission
282
How can e-business create business value?
285
Case Study 5.1 Capital One creates value
through e-business
286
Objective setting
287
Case Study 5.2 Setting the Internet revenue
contribution at Sandvik Steel
292
Strategy definition
295
Decision 1: E-business channel priorities
298
Decision 2: Market and product development
strategies
300
Decision 3: Positioning and differentiation
strategies
303
Decision 4: Business, service and revenue models
306
Decision 5: Marketplace restructuring
308
Decision 6: Supply-chain management capabilities 309
Decision 7: Internal knowledge management
capabilities
310
Decision 8: Organizational resourcing and
capabilities
310
Strategy implementation
313
Failed e-business strategies
314
E-business strategy implementation success
factors for SMEs
315
Case Study 5.3 Boo hoo – learning from the
largest European dot-com failure
316
Focus on information systems strategy and
e-business strategy
319
Elements of IS strategy
320
Investment appraisal
320
Summary
324
Exercises
325
References
326
Further reading
328
Web links
329
Part 2
Strategy and applications
253
viii
Contents
A01_CHAF9601_04_SE_FM.QXD:D01_CHAF7409_04_SE_C01.QXD 16/4/09 10:59 Page viii
6
Supply chain management
330
Learning outcomes / Management issues
330
Links to other chapters
330
Introduction
331
Problems of supply chain management
334
What is supply chain management?
335
Using technology to support supply chain
management – an example
337
A simple model of a supply chain
340
Case Study 6.1 Shell chemicals redefines its
customers’ supply chains
341
What is logistics?
345
Push and pull supply chain models
347
Focus on the value chain
348
Restructuring the internal value chain
350
The value stream
351
Value chain analysis
351
Value networks
352
Towards the virtual organization
354
Options for restructuring the supply chain
356
Using e-business to restructure the supply chain
358
Technology options and standards for supply
chain management
359
Adoption rates of e-business applications
360
Case Study 6.2 Tesco develops a buy-side
e-commerce system for supply chain management 363
IS-supported downstream supply chain
management
365
Outbound logistics management
365
IS infrastructure for supply chain management
366
Supply chain management implementation
368
Data standardization and exchange
368
Human resources requirements of SCM
369
The supply chain management strategy process
371
Managing partnerships
372
Managing global distribution
374
Case Study 6.3 RFID: keeping track starts its
move to a faster track
374
Summary
375
Exercises
376
References
377
Further reading
379
Web links
379
7
E-procurement
380
Learning outcomes / Management issues
380
Links to other chapters
380
Introduction
381
What is e-procurement?
381
Understanding the procurement process
384
Types of procurement
385
Participants in online procurement
386
Drivers of e-procurement
387
Case Study 7.1 Cambridge Consultants reduce
costs through e-procurement
388
Focus on estimating e-procurement cost
390
The impact of cost savings on profitability
391
Risks and impacts of e-procurement
392
Organizational risks
393
Failure to achieve real cost reductions
393
Technology risks
394
Implementing e-procurement
394
The growth in adoption of web-enabled
e-procurement
396
Integrating company systems with supplier
systems
397
Focus on electronic B2B marketplaces
400
Case Study 7.2 Covisint – a typical history of a
B2B marketplace?
403
Types of marketplace
405
The future of e-procurement?
407
Summary
407
Exercises
408
References
409
Further reading
410
Web links
410
8
E-marketing
412
Learning outcomes / Management issues
412
Links to other chapters
412
Introduction
413
Chapter structure
414
Real-world E-Business: Guess
415
What is e-marketing?
416
Marketing defined
416
E-marketing defined
417
Distinguishing between e-marketing, e-business
and e-commerce
417
E-marketing planning
418
Is a separate e-marketing plan required?
418
Situation analysis
420
Demand analysis
421
Competitor analysis
425
Intermediary analysis
427
Internal marketing audit
428
Objective setting
428
Case Study 8.1 The e-volution of easyJet’s online
revenue contribution
431
Strategy
433
Market and product positioning
436
Target market strategies
437
Focus on characteristics of new-media marketing
communications
443
Tactics
448
Product
451
Case Study 8.2 Dell gets closer to its customers
online
453
Price
456
Place
460
Promotion
462
People, Process and Physical evidence
464
Focus on online branding
464
The importance of brand online
467
Actions
469
Control
470
Case Study 8.3 The new Napster changes the
music marketing mix
471
ix
Contents
A01_CHAF9601_04_SE_FM.QXD:D01_CHAF7409_04_SE_C01.QXD 16/4/09 10:59 Page ix
Summary
475
Exercises
476
References
477
Further reading
479
Web links
480
9
Customer relationship management
481
Learning outcomes / Management issues
481
Links to other chapters
481
Introduction
482
Marketing applications of CRM
483
Real-world E-Business: Warner Breaks
484
What is e-CRM?
486
Benefits of e-CRM
487
Permission marketing
488
Customer profiling
490
Conversion marketing
491
The online buying process
492
Differences in buyer behaviour in target markets
493
Differences between B2C and B2B buyer
behaviour
493
The net promoter score
495
Customer acquisition management
498
Focus on marketing communications for customer
acquisition
498
The characteristics of interactive marketing
communications
499
Assessing marketing communications effectiveness 502
Online marketing communications
503
Customer retention management
526
Personalization and mass customization
528
Online communities
530
Techniques for managing customer activity and
value
533
Lifetime value modelling
534
Focus on excelling in e-commerce service quality
536
Improving online service quality
536
Customer extension
539
Advanced online segmentation and targeting
techniques
540
Technology solutions for CRM
546
Types of CRM applications
547
Integration with back-office systems
547
The choice of single-vendor solutions or a more
fragmented choice
548
Data quality
549
Case Study 9.1 Tesco.com increases product
range and uses triggered communications to
support CRM
549
Summary
552
Exercises
552
References
553
Further reading
556
Web links
557
10 Change management
560
Learning outcomes / Management issues
560
Links to other chapters
560
Introduction
561
The challenges of e-business transformation
561
The challenges of sell-side e-commerce
implementation
563
Different types of change in business
566
Case Study 10.1 Process management: making
complex business simpler
570
Planning change
572
The imperative for project governance?
572
The project plan and schedule for an e-business
system
574
Prototyping
576
Human resource requirements
579
Staff retention
580
Outsourcing
581
Revising organizational structures
583
Approaches to managing change
586
Senior management involvement
586
Models for achieving change
586
Organizational culture
588
Focus on knowledge management
590
What is knowledge?
590
Objectives of knowledge management
592
Implementing knowledge management
593
Technologies for implementing knowledge
management
594
Case Study 10.2 Using Web 2.0 tools to support
knowledge management at Janssen-Cillag Australia 596
Risk management
598
Summary
600
Exercises
600
References
601
Further reading
603
Web links
603
11 Analysis and design
604
Learning outcomes / Management issues
604
Links to other chapters
604
Introduction
605
Real-world E-Business: Arena Flowers
606
Analysis for e-business
608
Workflow management
609
Process modelling
610
Process mapping
610
Task analysis and task decomposition
610
Process dependencies
612
Validating a new process model
618
Part 3
Implementation
559
x
Contents
A01_CHAF9601_04_SE_FM.QXD:D01_CHAF7409_04_SE_C01.QXD 16/4/09 10:59 Page x
Data modelling
619
Design for e-business
621
Architectural design of e-business systems
621
Focus on user-centred site design
623
Use-case analysis
627
Designing the information architecture
634
Customer orientation
639
Elements of site design
641
Web accessibility
646
Case Study 11.1 Dabs.com refines its web store
649
Focus on security design for e-business
652
Managing computer viruses
658
Controlling information service usage
660
Monitoring of electronic communications
660
E-mail management
665
Hacking
669
Secure e-commerce transactions
671
Approaches to developing secure systems
671
Current approaches to e-commerce security
673
Reassuring the customer
674
Case Study 11.2 Building an e-business fortress
674
Summary
675
Exercises
676
References
677
Further reading
679
Web links
679
12 Implementation and maintenance
680
Learning outcomes / Management issues
680
Links to other chapters
680
Introduction
681
Real-world E-Business: Thomas Cook
682
Alternatives for acquiring e-business systems
684
Development of web-based content and services
686
Creating static web content
686
Software and services for web-site development
and testing
689
Testing
694
The testing process
694
Testing environments
695
Changeover
695
Database creation and data migration
696
Deployment planning
697
Content management and maintenance
697
Frequency and scope of content updating
697
Maintenance process and responsibilities
699
Focus on measuring and improving performance of
e-business systems
703
Principles of performance management and
improvement
704
Stage 1: Creating a performance management
system
705
Stage 2: Defining the performance metrics
framework
706
Stage 3: Tools and techniques for collecting
metrics and summarizing results
711
Budgeting
724
Case Study 12.1 Learning from Amazon’s culture
of metrics
726
Summary
732
Exercises
732
References
733
Further reading
734
Web links
735
Glossary
736
Index
754
xi
Contents
A01_CHAF9601_04_SE_FM.QXD:D01_CHAF7409_04_SE_C01.QXD 16/4/09 10:59 Page xi
Supporting resources
Visit www.pearsoned.co.uk/chaffey to find valuable online resources
Companion Website for students
� A study guide to reinforce key ideas and topics
� Multiple choice questions to test your learning
� Links to relevant sites on the web
� An online glossary to explain key terms
� Flashcards to test your understanding of key terms
� A smarter online searching guide
� Link to Dave Chaffey’s blog with a collection of articles and links
� Link to Dave Chaffey’s Twitter feed
For instructors
� Complete, downloadable Instructor’s Manual
� PowerPoint slides that can be downloaded and used for presentations
� Testbank of question material
Also: The Companion Website provides the following features:
� Search tool to help locate specific items of content
� E-mail results and profile tools to send results of quizzes to instructors
� Online help and support to assist with website usage and troubleshooting
For more information please contact your local Pearson Education sales representative or visit
www.pearsoned.co.uk/chaffey
A01_CHAF9601_04_SE_FM.QXD:D01_CHAF7409_04_SE_C01.QXD 16/4/09 10:59 Page xii
Preface
In 1849 a group of settlers travelling west towards the promised land, California, entered a
then unnamed valley. The valley presented a harsh environment with a barrier of mountains
to the west making the way forward unclear. Some of the settlers lost their lives as they
sought to find a route west before eventually reaching California and what was to become
one of the most prosperous places on Earth. As the group left the valley, one of the women
in the group turned and said ‘Goodbye, Death Valley’ and hence the valley got its name. The
route to e-business success is also not straightforward and similarly fraught with difficulties
of selecting the correct strategic direction and surviving in an increasingly harsh competitive
environment. Not all who follow the route survive. However, the competitive drivers to
follow this route, such as demand from customers and adoption by competitors, make this
journey essential. The rewards are evident from those adopters who identified the opportu-
nity early and steered their companies in the right direction.
But the journey to e-business can never be completed, because of the relentless evolution
in technology and new commercial approaches which exploit it. Smart e-businesses have an
agile approach which enables them to review and select the appropriate technologies at the
right time.
Flagship e-businesses with headquarters in California such as eBay and Google.com are
now leading global brands with turnovers of billions of dollars, yet this has happened less
than 300 years after the first modern settlers arrived.
This book is intended to equip current and future managers with some of the knowledge
and practical skills to help them navigate their organization towards e-business. It is your
guide to how all types of companies can prosper through e-business.
A primary aim of this book is to identify and review the key management decisions
required by organizations moving to e-business and consider the process by which these
decisions can be taken. Key questions are the following: What approach to e-business strat-
egy do we follow? How much do we need to invest in e-business? Which processes should be
our e-business priorities? Should we adopt new business and revenue models? What are the
main changes that need to be made to the organization to facilitate e-business?
Given the broad scope of e-business, this book takes an integrative approach drawing on
new and existing approaches and models from many disciplines including information sys-
tems, strategy, marketing, supply and value chain management, operations and human
resources management.
As we will see in Chapter 1, electronic business (e-business) is aimed at enhancing the com-
petitiveness of an organization by deploying innovative information and communications
technology throughout an organization and beyond, through links to partners and customers.
It does not simply involve using technology to automate existing processes, but should also
achieve process transformation by applying technology to help change these processes. To be
successful in managing e-business, a breadth of knowledge is needed of different business
processes and activities from across the value chain such as marketing and sales, through new
product development, manufacturing and inbound and outbound logistics. Organizations
also need to manage the change required by new processes and technology through what have
traditionally been support activities such as human resources management.
What is e-business management?
Electronic
commerce
(e-commerce)
All electronically mediated
information exchanges
between an organization
and its external stake-
holders.
A01_CHAF9601_04_SE_FM.QXD:D01_CHAF7409_04_SE_C01.QXD 16/4/09 10:59 Page xiii
xiv
Preface
Supply chain man-
agement (SCM)
The coordination of all
supply activities of an
organization from its
suppliers and partners to
its customers.
Electronic
commerce
(e-commerce)
All electronically mediated
information exchanges
between an organization
and its external stake-
holders.
Value chain
A model for analysis of
how supply chain activi-
ties can add value to
products and services
delivered to the customer.
Value networks
The links between an
organization and its
strategic and non-
strategic partners that
form its external value
chain.
From this definition, it is apparent that e-business involves looking at how electronic
communications can be used to enhance all aspects of an organization’s supply chain man-
agement. It also involves optimizing an organization’s value chain, a related concept that
describes the different value-adding activities that connect a company’s supply side with its
demand side. The e-business era also involves management of a network of interrelated
value chains or value networks.
To this point we have exclusively used the term ‘e-business’, but what of ‘e-commerce’? Both
these terms are applied in a variety of ways; to some they mean the same, to others they are
quite different. As explained in Chapter 1, what is most important is that they are applied
consistently within organizations so that employees and external stakeholders are clear
about how the organization can exploit electronic communications. The distinction made in
this book is to use ‘electronic commerce’ (e-commerce) to refer to all types of electronic
transactions between organizations and stakeholders whether they are financial transactions
or exchanges of information or other services. These e-commerce transactions are either
buy-side e-commerce or sell-side e-commerce and the management issues involved with
each aspect are considered separately in Part 2 of the book. ‘E-business’ is applied as a
broader term encompassing e-commerce but also including all electronic transactions
within an organization.
Management of e-commerce involves prioritizing buy-side and sell-side activities and
putting in place the plans and resources to deliver the identified benefits. These plans need
to focus on management of the many risks to success, some of which you may have experi-
enced when using e-commerce sites, from technical problems such as transactions that fail,
sites that are difficult to use or are too slow, through to problems with customer service or
fulfilment, which also indicate failure of management.
The overall structure of the book shown in Figure P.1 follows a logical sequence: introducing
e-business terms, concepts and history of development in Part 1; reviewing alternative
strategic approaches and applications of e-business in Part 2; and how strategy can be
implemented in Part 3. Within this overall structure, differences in how electronic com-
munications are used to support different business processes are considered separately. This
is achieved by distinguishing between how electronic communications are used, from buy-
side e-commerce aspects of supply chain management in Chapters 6 and 7, to the marketing
perspective of sell-side e-commerce in Chapters 8 and 9. Figure P.1 shows the emphasis of
perspective for the particular chapters.
Part 1: Introduction (Chapters 1–4)
Part 1 introduces e-business and e-commerce. It seeks to clarify basic terms and concepts by
looking at different interpretations of terms and applications through case studies.
� Chapter 1: Introduction to e-business and e-commerce. Definition of the meaning and scope
of e-business and e-commerce. Introduction to business use of the Internet – what are the
benefits and barriers to adoption and how widely used is it?
How is this book structured?
What is e-commerce management?
Electronic business
(e-business)
All electronically mediated
information exchanges,
both within an organiz-
ation and with external
stakeholders supporting
the range of business
processes.
Buy-side
e-commerce
E-commerce transactions
between an organization
and its suppliers and
other partners.
Sell-side
e-commerce
E-commerce transactions
between an organization
and its customers.
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