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Within five years of time, all companies will be Internet Companies or they wont be any Companies at all.

~ (Groove 1999)
 

Ebusiness, ECommerce, Ebiz, Ecom, Ebusiness consultants

A starting point is to define eBusiness as interaction with business partners, where the interaction is enabled by information technology. This is an accurate definition, but doesn't give us much insight into the excitement surrounding eBusiness and eCommerce. EDI(Electronic Data Interchange) technology has been around since the 1970s, but no one got very excited about EDI. So what does eBusiness have that EDI doesn't, apart from the natural glow of youth? The key change is the information technology available to "enable" business transactions electronically. The Internet has made access to enabling information technology much more widespread, cheaper, more powerful, and more integrated into the enterprise. EDI was about cutting back-office costs (for instance, orders sent from one business partner to another no longer required paper work).

eBusiness is changing the way we do business, at every step in the value chain (initial benefits for manufacturing firms will focus on the supply chain, which is the chain of activities from procuring raw materials, manufacturing the product to finally distributing it). It even beats EDI at its own game: EDI lowered transaction costs making feasible the rapid exchanges of orders in a just in time environment. eBusiness lowers transaction costs to the point where entire new classes of customers and services are profitable. EDI is expensive to set up, and was only used by large companies with their regular business partners; it required a very high level of volume to make sense. eBusiness is cheap, has hundreds of millions of participants already, and reaches into everything a business does. Another key change is people: the workforce is now full of people who are much more familiar with advanced technology than twenty years ago.

 
Another definition of eBusiness is that it is Business Process Re-engineering (BPR) revisited, except this time information technology is much more entwined. This is a provocative definition. Firstly, BPR was very painful in the 1980s, and only a few firms succeeded in radical change. BPR promised to redesign a firm so that all processes focused on the customer; old hierarchies were no longer relevant. It was supposed to empower junior employees, and remove layers of management. Many firms that thought they did a good job at BPR actually paid only lip service to the concepts. Secondly, it became associated with downsizing. Thirdly, it was supposed to be closely related to IT in the 1980s, so why do we need to emphasize that again?
 
The key technology of the 1980s was ERP (Enterprise Resource Planning) systems. ERP implementations are large, complex and slow moving projects. EPR systems were the first software systems to integrate supply chain all activities into a single IT backbone. The software involved was monolithic -- huge, expensive and not very flexible. The only way to implement an ERP system is to move the way the company does business to suit the ERP package; even ERP systems offering 'flexibility' is really just more comfortable straightjackets. The technology of eBusiness is different: it is smaller, faster and much more fragmented. There is no eBusiness system available from a single firm. An eBusiness infrastructure is made up by piecing together different systems (the first thing that is usually done is linking various eBusiness applications, such as an ordering website, into the ERP system, bypassing the ERP order entry method and just using the ERP system as a big database of inventory). This technology is rapidly changing business in many industries. Now that the dot.com hysteria has gone, we can see that eBusiness in a quantum leap in the way enterprises use information technology. The new requirements are to integrate with many external business partners and to have an IT environment that can much more quickly respond to changes such as mergers and acquisitions. eBusiness see the end of the attempt to run a business with centralized. Monolithic IT solutions. In a way, it's analogous to transport passing from the railway era to the roadway era. Railways are fixed gauge, run by a handful of operators, and users were expected to build their warehouses and factories near the railway, rather than the other way around. Railways are high volume and still today the best way of moving very heavy loads over long distances. But roads can be built almost everywhere; they can be heavy-duty eight lane masterpieces of civil engineering, or they can be gravel tracks where this is the only affordable solution. You can ride a bicycle on a road, or a Ferrari; carry goods in a minivan or an outback-Australian road-train.
 
eBusiness is about understanding the potential of new technologies in your market and in your supply chain and then reorienting your business to implement your vision, and implementing it quickly enough to minimize the threat from competitors if you are defending your market share, or fast enough to take advantage of the opportunities if you are aggressive about growing market share.
 
  
 
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