electronic commerce 043002 chapter 5: business-to-business strategies: from electronic data...
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Electronic Commerce043002
Chapter 5: Business-to-Business
Strategies: From Electronic Data Interchange to Electronic
CommerceDr. Jing Zhou
Dr. Jing Zhou - School of Computer Science, Communication University of China, Beijing; email [email protected]; © 2007
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Learning Objectives
In this chapter, you will learn about:
Strategies that businesses use to improve purchasing, logistics ( 物流 ), and other support activities
Electronic data interchange and how it works
How businesses are moving electronic data interchange operations to the Internet
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Learning Objectives Cont’d
Supply chain management ( 供应链管理 ) and how businesses are using the Internet and Web technologies to improve it
Electronic marketplaces ( 电子集市 ) and portals (门户 ) that make purchase-sale negotiations easier and more efficient
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Key Terms Accredited Standards Committee X12 公认标准委员会
X12 American National Standards Institute 美国国家标准协会
automated clearing house (ACH) 自动清算所 contract purchasing合同采购 customer portal 客户门户 direction connection EDI 直接连接 EDI direct material 直接物料 EDI-capable bank 支持 EDI业务的银行 EDI compatible EDI兼容
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Key Terms EDI for Administration, Commerce, and Transport
(EDIFACT or UN/EDIFACT) 管理、商务和运输的 EDI e-government 电子政务 e-procurement software 电子采购软件 e-sourcing 电子供应 financial EDI (FEDI)金融 EDI financial VAN (FVAN) 金融 VAN independent exchange 第三方交易中心 independent industry marketplace第三方行业电子集市 indirect connection EDI 间接连接 EDI
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Key Terms indirect material 间接物料 industry consortia-sponsored marketplace 行业共同电子集市
Internet EDI 互联网 EDI knowledge management 知识管理 maintenance, repair, and operating (MRO) 保养、维修和运营
nonrepudiation 不可否认 open EDI 开放式 EDI private company marketplace 专属电子集市 private store 专属店铺
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Key Terms public marketplace 公共电子集市 purchasing card (p-card) 采购卡 radio frequency identification device (RFID) 无线射频鉴别设备
replenishment purchasing 补货 /给采购 sourcing 供应 spend开支 spot market 现货市场 spot purchasing 现货采购 supply alliance 供应联盟 supply chain 供应链
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Key Terms supply web 供应网络 third-party logistics (3PL) provider第三方物流服务商 tier one supplier 一级供应商 tier two supplier 二级供应商 tier three supplier 三级供应商 transaction sets 报文标准 ultimate consumer orientation 最终消费者导向 value-added bank (VAB) 增值服务银行 vertical portal (vortal) 垂直门户
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Purchasing, Logistics, and Support Activities
Purchasing activities (购买活动 )
Include identifying vendors, evaluating vendors, selecting specific products, placing orders (下订单 ), and resolving any issues that arise after receiving the ordered goods or services
Supply chain (供应链 )
Part of an industry value chain that precedes a particular strategic business unit
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Purchasing, Logistics, and Support Activities Cont’d
Procurement (采购 )
Includes all purchasing activities, plus monitoring of all elements of purchase transactions
Also includes managing and developing relationship with key suppliers
Supply management (供应管理 )
Term used to describe procurement activities
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Purchasing, Logistics, and Support Activities Cont’d
Sourcing (供应 )
Procurement activity devoted to identifying suppliers and determining their qualifications
E-procurement or e-sourcing
Use of Internet technologies in procurement and sourcing activities
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Direct vs. Indirect Materials Purchasing
Direct materials (直接物料 ) Materials that become part of the finished product
in a manufacturing process Replenishment/Contract purchasing (补货采
购 /合同采购 ) The company negotiates long-term contracts for
most of the materials that it will need
When actual demand is higher than company’s expected demand, it must buy additional material
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Direct vs. Indirect Materials Purchasing Cont’d Purchases are made in a loosely organized
market called a spot market (现货市场 )
This second type of direct materials purchasing is called spot purchasing (现货采购 )
Indirect materials (间接物料 ) Other materials that the company purchases,
including factory supplies Office depot China http://law.asiaec.com/ Staples http://www.staples.com.cn/website/Default.html
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Logistics Activities (物流活动 )
Include managing Inbound movements of materials and supplies Outbound movements of finished goods and
services Objective of logistics
To provide the right goods in the right quantities in the right place at the right time
Logistics management Important support activity for both sales and
purchasing activities
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Logistics Activities Cont’d
Receiving (收货 ), warehousing (仓储 ), controlling inventory (库存控制 ), scheduling and controlling vehicles (车辆的调度和控制 ), and distributing finished goods (产成品的分销 ) are all logistics activities
For example,
the Schneider Track and Trace system delivers real-time shipment info to its customer
J.B. Hunt lets its customer track their shipments themselves
When transportation and freight companies engage in the business of operating all or a large portion of a customer’s materials movement activities, the company is called a third-party logistics provider (第三方物流服务商 )
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Support Activities (辅助活动 )
Support activities
Include categories of finance (财务 ) and administration (管理 ), human resources (人力资源 ), and technology development
Many companies can offer support activities services including human resources functions (Online Benefits), document storage services (CyLex Systems), and payroll processing (PayMaxx)
Larger firms are building these functions into their intranets
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Support Activities Cont’d
In 1999 Ericsson launched an extranet which included a Web site Enabled recipients of payments from the company’s
medical and retirement plans to track benefits Designed to facilitate knowledge management (知识管理 )
Knowledge management Intentional collection, classification, and dissemination
of information about A company, its products, and its processes
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E-Government (电子政务 )
Use of electronic commerce by governments and government agencies to
Perform functions for their stakeholders
Employ people, buy supplies from vendors, and distribute benefit payments
Collect taxes and fees from constituents (选民 )
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E-Government Cont’d
E-government can reduce administrative costs and provide better services to stakeholders
The most common services offered are: access to the state laws and regulations, renewal of licenses, promotion of the state to businesses considering new locations (招商引资 ), job listings, promotion of tourism in the state (推广旅游 ), tax form and filing information, and information for companies that want to do business with the state
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Network Model of Economic Organization
One trend becoming clear in purchasing, logistics, and support activities is the shift away from hierarchical structures toward network structures
Some researchers studying the interaction of firms within an industry value chain are beginning to use the term “supply web” instead of “supply chain”
The emerging networks of firms are more flexible and can respond to changes in the economic environment much more quickly
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Electronic Data Interchange (EDI,电子数据交换 )
Computer-to-computer transfer of business information between two businesses that uses a standard format of some kind
EDI compatible (兼容 ) Firms that exchange data in specific standard
formats Business information exchanged is often
transaction data Most B2B electronic commerce
An adaptation of EDI or based on EDI principles
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Early Business Information Interchange Efforts
1950s Companies began to use computers to store and
process internal transaction records
In 1968 Number of freight and shipping companies formed
the Transportation Data Coordinating Committee (TDCC) which was charged with exploring ways to reduce paperwork (文书工作 ) burden
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Early Business Information Interchange Efforts Cont’d
TDCC Created a standardized information set including
all the data elements that the shippers (发货人 ) commonly included on bills of lading(提货单 ), freight invoices(运费发票 ), shipping manifests (载货清单 ), and other paper forms
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Emergence of Broader EDI Standards
American National Standards Institute (ANSI)
Has been coordinating body (协调组织 ) for standards in the United States since 1918
Does not set standards itself
Has created a set of procedures for the development of national standards
Accredits (授权 ) committees that follow those procedures
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Emergence of Broader EDI Standards Cont’d
Accredited Standards Committee X12 (ASC X12) Chartered by ANSI to develop uniform EDI
standards in 1979 Include information systems professionals from
over 800 businesses and other organizations Transaction sets ( 报文集 )
Names of formats for specific business data interchanges
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Emergence of Broader EDI Standards Cont’d
In 1987 United Nations published first standards under the
title EDI for Administration, Commerce, and Transport
(EDIFACT, or UN/EDIFACT)
Late 2000 ASC X12 organization and UN/EDIFACT group
agreed to develop one common set of international standards
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How EDI Works
EDI Implementation can be complicated
Example Consider company that needs a replacement for
one of its metal-cutting machines (金属切割机床 ) Paper-based purchasing process
Buyer and vendor are not using any integrated software for business processes internally
Information transfer between buyer and vendor is paper based
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Direct connection ( 直接连接 ) EDI
Direct connection EDI
Requires each business in the network to operate its own on-site EDI translator computer
EDI translator computers are connected directly to each other using
Modems and dial-up telephone lines or dedicated leased lines (专线 )
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Value-Added Networks ( 增值网 )
Indirect connection (间接连接 ) EDI
To send an EDI transaction set to a trading partner
VAN customer connects to the VAN then forwards EDI formatted message to VAN
VAN logs the message and delivers it to trading partner’s mailbox
Trading partner then dials in to the VAN and retrieves its EDI-formatted messages
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Advantages of using a VAN
Users need to support only the VAN’s one communications protocol
The VAN
Records message activity in an audit log (运行记录 )
Can provide translation between different transaction sets used by trading partners
Can perform automatic compliance checking
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Disadvantages of using a VAN
Cost
Most VANs require
An enrollment fee (注册费 ), a monthly maintenance fee (月租费 ), and a transaction fee (交易费 )
Using VANs can become cumbersome and expensive for companies that
Want to do business with a number of trading partners, each using different VANs
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EDI on the Internet
Initial roadblocks to conducting EDI over the Internet Concerns about security Internet’s inability to provide audit logs and third-
party verification (第三方验证 ) of message transmission and delivery
Nonrepudiation (不可否认 ) Ability to establish that a particular transaction
actually occurred
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Open Architecture of the Internet
Internet EDI or Web EDI EDI on the Internet Also called open EDI
Open architecture of Internet Allows trading partners unlimited opportunities for
customizing information interchanges
New tools such as XML Helping trading partners be even more flexible in
exchanging detailed information
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Financial EDI (金融 EDI)
EDI transaction sets that provide instructions to a trading partner’s bank
Automated clearing house (ACH, 自动清算所 ) system Service that banks use to manage accounts with
each other
EDI-capable (支持 EDI业务 ) banks Equipped to exchange payment (付款 ) and
remittance (汇款 ) data through VANs
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Financial EDI Cont’d
Value-added banks (VABs, 增值服务银行 )
Banks that offer VAN services for nonfinancial transactions
Financial VANs (FVANs, 金融增值网 )
Nonbank VANs that can translate financial transaction sets into ACH formats
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Supply Chain Management(供应链管理 ) When companies integrate their supply management
and logistics activities across multiple participants in a particular product’s supply chain, the job of managing that integration is called supply chain management
Supply chain management
Was originally developed to reduce costs
Is now used to add value in the form of benefits to the ultimate consumer at the end of the chain, which requires a more holistic view (全局的观点 ) of the entire supply chain
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Supply Chain Management Cont’d
Businesses that engage in supply chain management Establish long-term relationships with small
number of capable suppliers – tier one suppliers (一级供应商 )
Tier one suppliers Develop long-term relationships with larger
number of suppliers that provide components and raw materials – tier two suppliers ( 二级供应商 )
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Supply Chain Management Cont’d
Tier two suppliers
Manage relationships with the next level of suppliers – tier three suppliers ( 三级供应商 )
Supply alliances (供应联盟 )
Long-term relationships created among participants in the supply chain
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Internet Technologies and the Supply Chain Key elements of successful supply chain
management Clear communications ( 明确的沟通 ) and quick
responses (快速的响应 )
Technologies, especially Internet and Web technologies, can be very effective communications enhancers
Major disadvantage of using Internet technologies in supply chain management The cost of the technologies
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Increasing Supply Chain Efficiencies Many companies are using Internet and Web
technologies to manage supply chains that yield increases in efficiencies
These companies have found ways to increase process speed, reduce costs, and increase manufacturing flexibility
Examples
Boeing, the largest producer of commercial aircraft
Dell Computer, famous for use of Web to sell custom-configured computers
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Using Materials-Tracking (物料跟踪 ) Technologies with EDI and EC In many industries, the integration of bar coding and
EDI has been prevalent for tracking materials movement
In the 2nd wave of electronic commerce, companies are integrating new types of tracking, such as radio frequency identification devices (RFIDs, 无线射频标签 )
The passive (被动 ) RFID tag Includes information about the inventory item
Can be made cheaply and in small size
Does not need a power source
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Creating an Ultimate Consumer Orientation (最终的消费者导向 ) One goal of supply chain management is to help each
company in the chain focus on meeting needs of consumer at the end of the supply chain, which are often called ultimate consumer orientation
One company pioneering the use of Internet technology to facilitate creating ultimate consumer orientation is Michelin North America
Most IT and purchasing managers believe that IT helps to improve their firm’s relationships with suppliers and supply chain management
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Building and Maintaining Trust in the Supply Chain
Major issue for most companies to form supply chain alliances
Developing trust
Key elements for building trust
Continual communication ( 持续的沟通 ) and information sharing ( 信息共享 )
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Building and Maintaining Trust in the Supply Chain Cont’d Procurement professionals build trust on years of
doing business with the same vendor
Vendors send sales representatives to call on buyers regularly
Vendors participate in trade shows (贸易展 ) and conferences
Vendors are finding that the Web gives them opportunity to stay in contact with customers more easily and less expensively
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Electronic Marketplaces ( 电子集市 ) and Portals (门户 ) Many business researchers and consultants believe
that the Web provides opportunity for companies to establish information hubs ( 信息中心 ), marketplaces, and auctions (拍卖中心 )
Vertical portals (vortals, 垂直门户 )
Offer a doorway (or portal) to the Internet for industry members
Vertically integrated – each hub would offer services to just one industry
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Independent Industry Marketplaces (独立的行业集市 ) Industry marketplaces (行业集市 )
Focused on a single industry
Independent exchanges (第三方交易中心 )
Not controlled by a company that was an established buyer or seller in the industry ( 非本行业某家公司所控制 )
Public marketplaces (公共电子集市 )
Open to new buyers and sellers just entering the industry
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Private Stores (专属商店 ) and Customer Portals ( 客户门户 )
Private store
Has password-protected entrance
Offers negotiated price reductions on limited selection of products
Customer portal sites
Offer private stores along with services such as part number cross-referencing (零件编码表 ), product usage guidelines, safety information, and other services
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Private Company Marketplaces (专属公司电子集市 )
E-procurement software
Allows a company to manage its purchasing function through a Web interface
Private company marketplace
A marketplace that provides auctions, request for quote postings, and other features many of which are similar to those of e-procurement software
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Industry Consortia-Sponsored Marketplaces (行业共同电子集市 ) Formed by several large buyers in a particular
industry
Covisint
Created in 2000 by a consortium of DaimlerChrysler, Ford, and General Motors
In the hotel industry
Marriott, Hyatt, and three other major hotel chains formed a consortium to create Avendra
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Summary
Companies are using Internet and Web technologies To improve purchasing, logistics, and support
activities EDI
First developed by freight and shipping companies to reduce the paperwork burden
Internet Now providing the inexpensive communications
channel that EDI lacked
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Summary
Supply chain management Incorporates several elements that can be
implemented and enhanced through use of Internet and Web
Models for B2B electronic commerce Independent industry marketplaces Private stores, customer portals Private company marketplaces Industry consortia-sponsored marketplaces