Explain how e-business processes improve productivity, efficiency, and competitive advantage for business organizations and the public sector (government and nonprofit organizations).
I think it it is important to define the “e” in e-business. The “e” stands for “electronic” and implies that the business is networked (i.e. – connected). E-businesses typically make heavy use of technologies such as the internet and electronic data interchange (EDI) to improve productivity, efficiency, and competitive advantage. An e-business applies technology and process to both external and internal business requirements but tends to apply more focus on internal processes as a means to improve productivity, efficiency, cost structures and competitive advantage.
E-businesses are connected businesses who leverage technology to operate effectively in a truly global economy.
These technologies might include:
- Various wired, wireless and mobile networking technologies
- APIs (application program interfaces) to streamline how applications talk to each other and exchange information
- Collaboration and communication tools to like e-mail, Cisco WebEx, Cisco Spark, Slack, etc… are critical in a truly global economy
- BI (business intelligence) tools
- CRM (customer relationship management)
- ERP (enterprise resource planning) systems
- EDI (electronic data interchange)
These technologies allow organizations to better communicate both internally and externally using empirical data that is both accurate and relevant.
EDI extends this communication ecosystem by connecting disparate buyers, suppliers, and partners. In a B2B context, this helps organizations significantly improve operational efficiencies via the exchange of data that is critical to all stakeholders. This exchange of data can facilitate JIT (just-in-time) inventory strategies where buyers understand the inventory and lead time of suppliers, and suppliers understand potential demand. Exchange of information such as this allows both the buyer and the supplier to streamline their operations making them more efficient, increasing productivity and ultimately makes them more competitive in the market.
The implementation of e-business practices in the public sector can provide similar benefits to e-business practices in the private sector. While the private sector focuses heavily on B2B (business-to-business) applications as well as B2C (business-to-consumer) applications of technology the private sector may be willing to abandon a particular segment of the population if it does not align with their mission and/or vision. A good example of this is Amazon, if you don’t have an internet connected device you likely are not viewed by Amazon as their target market and Amazon is willing to forego you as a customer. Although the launch of brick and mortar Amazon stores, Amazon’s acquisition of Whole Foods and their recent partnership with Kohls might imply that Amazon wants to capture this segment of the market. The public sector has a responsibility to ensure that the services they are providing are available to everyone. The public sector has more of a B2C (business-to-consumer) and C2C (consumer-to-consumer) focus, and the use of websites, social media, and electronic communications has changed the way in which citizen access information, the information available to citizens and the information transparency. Public sector organizations capture a significant amount of data on citizens, or members and this data can now be better aggregated and analyzed allowing public sector organizations to serve their constituents more efficiently and cost-effectively. Public sector organizations have to contend which challenges that the private sector can afford to ignore, simply stating this is not a target market.
The lines are very blurry and becoming more blurred with each passing day. Many technical disruptors are building both B2B and B2C platforms, data captured from both business partners as well as consumers make the platforms more robust and meaningful to all the stakeholders. I think about the companies like Uber and their relationship with drivers and the riders. The Uber to driver relationship is a B2B relationship while the relationship between Uber and the rider is a B2C relationship. This same paradigm exists with Amazon and the Amazon marketplace, and there are many more examples. What’s clear is that as we become more connected the productivity, efficiencies, new entrants, opportunities, etc… are exponential, not linear.
Bartels, A. (2000, October 30). The difference between e-business and e-commerce. Retrieved September 21, 2017, from https://www.computerworld.com/article/2588708/e-commerce/e-commerce-the-difference-between-e-business-and-e-commerce.html
Ripley, H. -. (2014, January 29). How e-business transforms public sector services in the UK. Retrieved September 21, 2017, from http://www.accaglobal.com/in/en/technical-activities/technical-resources-search/2014/january/How-e-business-transforms-public-sector-services.html
Turban, Efraim, et al. Information technology for management digital strategies for insight, action, and sustainable performance. New Jersey (Estados Unidos), Wiley, 2015.