How E-Commerce can reduce cycle time,improve employees'empowerment and facilitate customer support

E-Commerce is a type of business model, or segment of a larger business model, that enables a firm or individual to conduct business over an electronic network, typically the internet. Electronic commerce operates in all four of the major market segments: business to business, business to consumer, consumer to consumer and consumer to business. There have some advantages by using E-Commerce which will discuss below.

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Cycle time is the amount of time between a customer placing an order when they are needed and receiving the goods. Reducing cycle times means that shorten the time it take for a business to complete the productive activity from the beginning until the end. It can increase competitive advantage, decrease costs, and increase revenue. E-Commerce reducing the cycle time by eliminating an intermediaries between sellers and buyers because they attempt to sell directly to customers. Besides that, online store operates at 24 hours so the customers are given the opportunity to browse,shop and do their transaction in any time. In addition,customers can receive relevant and detailed information in seconds, rather than days or weeks. For example, Dell has plans to open manufacturing facilities in emerging markets such as Brazil, India and central Europe on September, 2007 in order to get closer to customers and reduce cycle time.

E-Commerce also improve employees'empowerment by enabling or authorizing an individual to think, behave, take action, and control work and decision making in autonomous ways. For example, customers are able to view your online shop (your website) and then they will choose exactly what type product they want, so the employees are responsible to deal with the customers without need to get permission from their employer. This is because employees can make their own decicions, thus this will increase the productivity. Moreover, E-Commerce also providing employees with greater and easier access to information provided by the employer. With the intranet, employees can be able to access the company's database to know the latest activity.

E-Commerce facilitates customer support by providing a wide range of technological solutions and communication opportunities. Additionally, E-Commerce supports self-help customer service so consumers can answer their own questions.Besides that,consumers also can send their inquiry for some products and services by email to enable them to get the detailed information.On the other hand,E-Commerce provides customers with more choices and frequently provides customers with less expensive products and services by allowing them to shop in many places and conduct quick comparison.

History and Evolution of E-commerce

In the early century, our earth is without any form and it is void. Began in 1970s, the applications of E-commerce was developed with innovations. E-commerce was changed the traditional form of "buy and sell" in the market. The organization can be routed electronically from one to another;however, these services were only provided to some of the large organization.The found of the Electronic Data Interchange (EDI) is use to transfer the information and documents. Since the EDI occurred, another form of e-commerce application was followed in the market such as, interorganizational system (IOS).

Furthermore, the e-commerce was started in 1991 while it available for commercial use when most of the user begin searching and participating in the World Wide Web (www). In the year 1999, the internet is emphasis of e-commerce from B2C to B2B however it was changed in 2001 from B2B to B2E. There were found a lot of new learning like e-commerce, e-government, and e-learning necessary for public. The most famous companies which applied e-commerce are Amazon.com,Inc and Ebay. The consumer can buy and sell their products via internet. Meanwhile, there were also having a lot of failure companies using e-commerce for example, Webvan.com, eToys, Xpeditor and others.

http://www.ecommerce-land.com/history_ecommerce.html

An example of an E-Commerce failure and its causes.

Kozmo.com

Kozmo.com, an online store and delivery service, promised fast, friendly delivery of almost anything, from movies to snack food, such as a DVD rental, a bag of groceries, or just a single pack of gum and even a candy bar. It was a great idea that you could order a wide variety of products, and snack foods were undoubtedly their top seller. Kozmo.com was very convenient and it refused to charge delivery fees. It was founded by young investment bankers Joseph Park and Yong Kang in March 1998 in New York City. The Company had a business model that promised to deliver small goods free of charge, by using bicycle messengers. The company boasted “from the Internet to your door in under an hour” and its attractive rates helped rapidly draw thousands of customers.

Even though the company raised more then $250 million, but it was unable to generate enough revenue to cover the costs. In 1999, the company had revenue of $3.5 million , with a resulting net loss of $26.4 million. It also entered a five-year co-marketing agreement with Starbucks in February 2000, and it agreed to pay Starburks $150 million to promote its services inside the company’s coffee shops. However, Kozmo.com ended its deal in March 2001 after paying out $15 million.

The main problems that Kozmo faced which included offering one-hour point-to-point delivery of small goods is extremely expensive, since it was free of delivery charge and it was impossible to turn a profit. The greatest error that Kozmo made with their customers was when they stopped catering to their main client base of middle class college-student, in order to target more upscale clients who would order expensive goods. No matter how the company put effort to boost orders and stop the delivery losses, still didn’t stop it from shutting down in April 2001 and laying off its staff of 1,100 employees.

The cost of the small-time deliveries contributed to the demise of this great idea.

An example of an E-commerce success and its causes

Amazon is the largest online shopping site and one of the most widely known e-commerce sites on the Web. It is founded by Jeff Bezos since July 1995. Amazon operates in four international Wed Sides, which include www.amazon.fr, www.amazon.co.uk, www.amazon.de and www.amazon.co.jp. Furthermore, it also operates the Internet Movie Database (www.imdb.com), the Web's comprehensive and authoritative source of information on more than 250,000 movies and entertainment titles and 1 million cast and crew members dating from the birth of firm in 1891 to the present.

Today Amazon offers "Earth's Biggest Selection" of nearly everything. It has 35 million customers and lists millions of unique items in categories such as electronics, kitchen and house wares, books, music, DVDs, videos, photography equipment, toys, software, computer and video games, tools and hardware, outdoor living and wireless product.

The main reason that Amazon success is that it strong focuses on customer experience, which is infused throughout all levels of the company and includes all aspects of the buying process. In addition, Amazon.com can let all retailers sell goods remotely by internet, phone or mail order, credit card.

Amazon established separate website at different country, for example, China, Japan, Canada and so on. It provides global shipping and help increase in the profit.

References:

1. http://www.sas.com/success/amazon_personalization.html

2. http://www.truthout.org/article/the-success-amazon-welfare-we-should-know-it