B2B Commerce

E-Commerce framework
Common business services infrastructure
(security/authentication, electronic payment,
directories/catalogs)
The messaging & information distribution
infrastructure

Multimedia content & network publishing

infrastructure
The information superhighway infrastructure
(telecom, cable TV, wireless, Internet)

Public policy
legal & privacy
issues

Technical standards for electronic

documents, multimedia & n/w
protocols

E-commerce applications

Supply chain management

Video on demand
Procurement & purchasing
On-line marketing & advertising
Home shopping

Organizational structures
The vertical organization
Problems:
Creates boundaries ( gaps between employees)
Dept goals may cause friction among depts

The horizontal organization

Goal
Facilitate smooth transition of intermediate
products & services through its various functions to
the customer

 Goal achieving:
Empower employees
Improve communication
Eliminate unnecessary work
Two-tiered structure
Senior management (strategic decisions & policies)
Employees (process team)

Objective of horizontal structure:

Change the staffs focus from coordinating &
reporting to improving flow management , work
quality & increasing value for customers

New forms of organization structure

1. Virtual / Network Organizational
structure (Eg:- CISCO Systems
manufacturer of routers)
2. Brokerage structures

Virtual / Network Organizational Structure

The virtual organization is closely coupled
upstream
with
its
suppliers
and
downstream with its customers
A virtual organization or company is one
whose members are geographically apart,
usually working by computer e-mail and
groupware while appearing to others to be
a single, unified organization with a real
physical location.
Geographically dispersed teams allow
organizations to hire and retain the best
people regardless of location.

Electronic Brokerage
Goal:- to increase the efficiency of
internal marketplace
Multiple services provided by a single
interface with a single point of
accountability on an order-by-order
basis

Types of electronic brokerages in internal markets

customers
Internal markets
order

delivery

Order
management &
financial
accounting

shipping

Production
brokerage

Design
brokerage

Manufacturing
& scheduling
brokerage

Logistic & supply

chain management
brokerage

Customization & Internal Commerce

Electronic
commerce &
technology

Technology provides
access to a variety of
products & services

Need to cut costs drives

the need for improved
technology

Consumer
behavior &
choice

Consumer choice dictates the

marketing, distribution & production
of products & services

Organization dynamics &

market place competition

The technology, choice and marketplace triad

 Mass customization, not mass

production
Cars, planes, textile / clothing technology

Example: Radio frequency tags, eliminate the need

for bar coded labels
Infrared scanning

Customization of services

Supply Chain Management (SCM)

SCM is the process of planning,
implementing, and controlling the
operations of the supply chain with the
purpose to satisfy customer
requirements as efficiently as possible.
SCM optimizes info & product flows
from the receipt of the order, to
purchase of raw materials, to delivery
and consumption of finished goods

Characteristics of SCM
Ability to source raw material / finished goods
from anywhere in the world
Centralized, global business & management
strategies with flawless local execution
On-line, real-time distributed info processing to
the desktop, providing total supply chain
information visibility
Manage info across industries & enterprises
Integration of all supply chain processes &
measurements
Development & implementation of accounting
models
Reconfiguration of the supply chain org into high
performance teams

Models of SCM

Push based SCM

Pull based SCM
A customer "pulls" things towards themselves,
while a producer "pushes" things toward
customers
In a "push" system the consumer does not
request the product to be developed; it is
"pushed at" the end-user by promotion.
example:- perfume product
In a "pull" system the consumer requests the
product and "pulls" it through the delivery
channel.
example:- car manufacturing company Toyota.
Toyota only produces cars when they have been
ordered by the customers.

Elements of these models

1. logistic & distribution (integrated logistics)
A methodology employed to more
efficiently manage inventory mechanisms.
The activities are viewed as a system,
rather than many different activities.
Usually involves the inventory pulls from
manufacturing sites and warehouses,
through distribution to the customer. The
execution involves merging transportation
modes, systems and distribution for the
optimum solution.

2. Integrated marketing & distribution

integrate the customer directly & react to
changes in demand by modifying the
supply chain
3. Agile manufacturing
Agile manufacturing is a term applied to an
organization that has created the
processes, tools, and training to enable it
to respond quickly to customer needs and
market changes while still controlling
costs and quality.

Key attributes
Agility has four components:
1. delivering value to the customer
2. being ready for change
3. valuing human knowledge and skills
4. forming virtual partnerships

Push based supply chain

Manufacturer
Financial / marketing-driven forecast
Master scheduling
Replenishment based on distribution center inventory
Manual purchase order & invoicing
Retail distribution center
Order point based on warehouse inventory & historical forecasts
Deals, promotions & forward buying
Manual purchase orders, info entry and o/p
Retail store
Order point based on shelf inventory & forecasts
Promotions
Manual entry of items to be reordered
Consumers purchase merchandise

Pull based supply chain

Consumers purchase merchandise
Retail store
POS data collection
Perpetual inventory tracked UPC level
Automatic replenishment using EDI services
Retail distribution center
Automatic replenishment
Shipping container marking
cross-dock receiving
EDI services
Manufacturer
Demand driven forecast based on POS data & product development
Micromarket-driven
Short cycle manufacturing
Advances shipping notice & EDI services
Bar code scanners & UPC ticketing