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King Fahd University of Petroleum & MineralsCollege of Computer Science & Engineering

Department of Computer Engineering

Short Course on

E-Business: Strategies, Processes and Technologies

Iftikhar NadeemSenior Consultant, E-Business Solutions

Center for Economics & Management SystemsResearch Institute, KFUPM

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Introduction• Major Industry Trends• E-Business Drivers and Responses• What is eBusiness?• E-Business Networks• E-Government• E-Marketplaces• E-Business issues and Success Factors• E-Readiness• E-Business: the Case of Saudi Arabia

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Market Value of an Organization

Tangible Assets• Buildings

• Equipment

• Furniture

• Cash

Intangible Assets• Skills & competencies

• Motivation of employees

• Databases

• Information technologies

• Efficient & responsive processes

• Customer loyalty & relationships

Value of tangible assets1982: 62%1992: 38%2000: 10-15%

Source: Brookings Institute

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Major Industry trends• Consumer trends• Service/process trends• Organizational trends• Enterprise technology trends

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Consumer Trends• Speed of service• Self-service• Integrated solutions, not piecemeal products

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Service/Process Trends• Convergence of sales & service: customization and

integration• Ease of use: make service consistent and reliable• Flexible fulfillment and convenient service delivery:

streamline your supply chain

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Organizational Trends• Contract manufacturing: becoming brand intensive, not

capital intensive• Retain the core, outsource the rest: Business process

outsourcing• Increasing process transparency and visibility• Continuous innovation and employee retention

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Enterprise Technology Trends• Enterprise applications: Connect the corporation• Infrastructure convergence: Increasing melding of voice,

data and video• Multichannel integration: computer telephony integration

and voice recognition• Wireless applications enter the mainstream• Leveraging legacy investment: The rise of middleware for

systems integration

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Business Drivers of the New Economy

• Global financial interdependence• Deregulation• Unrestricted capital flows• Digitization• Global communication and transportation • New geopolitical realities

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Key Business Challenges

• Agility and Speed• Focus on core competencies and processes• Customer centrality• Mass customization• Flexible IT architecture• Interoperability of infrastructure and applications

portfolios

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New Business Models and Structures

• Aggregators• Portals• Info-mediaries• E-tailers• Hybrids• Virtually integrated • Mega-mergers

Transformation:From Product to Information

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E-Business is About Business

IT DrivingBusiness

BusinessDriving IT

E-Business

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Major Benefits of eBusiness

• Global reach

• Reduced cost

• Convenience

• Higher productivity and efficiency

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E-Business

E-Business is about enabling organizations to cohesively bring together their processes and Internet technologies for cost effectiveness, efficiency and better relationships between partners.

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E-Business

E-Business is the electronic connection of business operations to customers, suppliers, employees and other partners. It includes, but not limited to, product marketing, order entry, inventory tracking, order fulfillment and after-sales support.

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E-Commerce

E-Commerce has a narrower definition and only involves buying and selling goods and services over the Internet. It is normally limited to catalogs, order entry, authorization and delivery confirmation.

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The E-Business Network

Intranet and

Extranet

E-Business

NetworkNetworking

Vendors

Network

Software

Network Hardware

Enabling Technology

E-Commerce

Applications

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eBusiness: Technologies and Skills

• Web technologies

• Database technologies

• Integration technologies

• Networking technologies

• Security technologies

• CIW Tracks:– Designer– Developer– Administrator

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What is Important in an E-Business Network?

• Functionality

• Reliability

• Security

• Speed

• Scalability

• Access Control

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Why Does an E-Business Network Matter to a User?

• To share knowledge and reap productivity gains by finding information faster

• To communicate faster with clients and suppliers

• To provide options for teleworking

• To implement web services

• To enable teams to work collaboratively irrespective of geography

• To better automate business procedures

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Why Does an E-Business Network Matter to an Enterprise?

• To create fundamental changes in business processes

• To enable fast responses and agile maneuvering

• To negotiate more effectively with suppliers

• To create competitive advantage

• To provide instant access to global markets

• To lower costs

• To enable the convergence of voice, data and video

• To use the e-business as a key to business operations

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CEOs are Focusing on These E-Business Issues

• Building customer loyalty

• Achieving market leadership

• Streamlining business processes

• Creating new products/services

• Ascertaining compliance

• Reaching new markets

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E-Business Best Practices

• Personalize relations

• Maintain visitor privacy

• Make your site easy to use

• Manage visitor perceptions

• Maintain site consistency

• Manage business knowledge

• Response quickly

1-1-241990-96 97 98 99 2000 01 02 03 04 05 06 07 08 09 2010

Tech Trigger

Peak of expectation

DisillusionmentEnlightenment

True E-businessWWW

Dot Com

Visibility

Source: Gartner Group

E-Business Hype Cycle

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Worldwide IT Spending Growth(New Scenario)

10

7

10.611.3

10

2.4

6.1

10.5

0

2

4

6

8

10

12

2000 2001 2002 2003

OldNew

%

Source: IDC, October 18, 2001

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Global E-ReadinessIt describes the extent to which a country’s business environment

is conducive to Internet-based commercial opportunities

• EIU E-Readiness Assessment Model 2001– Connectivity (30%)

– Business Environment (20%)

– E-Commerce Adoption (20%)

– Legal Environment (15%)

– Supporting E-Services (10%)

– Social and Cultural Environment (5%)

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Grouping of Countries by E-readiness Ranking 

E-business leaders E-business contenders E-business followers E-business laggards

US (8.73)AustraliaUKCanadaNorwaySwedenSingaporeFinlandDenmarkNetherlandsSwitzerlandGermanyHong Kong (7.45)

Ireland (7.28)FranceAustriaTaiwanJapanBelgiumNew ZealandSouth KoreaItalyIsraelSpainPortugal (6.21)

GreeceCzech RepublicHungaryChilePolandArgentinaSlovakiaMalaysiaMexicoSouth AfricaBrazilTurkeyColombiaPhilippines

Egypt (3.88)PeruRussiaSri LankaSaudi Arabia (3.80)IndiaThailandVenezuela

Bulgaria (3.38)ChinaEcuadorIranRomaniaUkraineAlgeriaIndonesiaNigeriaKazakhstanVietnamAzerbaijanPakistan (2.66)

 

.Source: The Economist Intelligent Unit, 2001

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Rank CountryNumber of

SubscribersNumber of Users per

Number of Users

% of Population

1 UAE 220,000 3 660,000 24.442 Bahrain 35,000 3 105,000 16.673 Qatar 25,000 3 75,000 10.274 Kuwait 55,000 3 165,000 8.255 Lebanon 75,000 3.5 262,500 6.566 Jordan 35,000 6* 210,000 4.577 Palestine 12,000 5 60,000 3.538 Oman 28,000 3 84,000 3.369 Tunisia 70,000 4 280,000 2.89

10 Saudi Arabia 190,000 3 570,000 2.5911 Egypt 70,000 8** 560,000 0.8212 Morocco 55,000 4 220,000 0.7313 Algeria 45,000 4 180,000 0.614 Libya 4,000 5 20,000 0.415 Syria 8,000 4 32,000 0.1816 Yemen 3,500 4 14,000 0.0817 Sudan 7,000 4 28,000 0.0818 Iraq 500 25*** 12,500 0.06

Total 938,000 3,538,000 1.29

Internet Subscribers in the Arab Region

Source: Ajeeb.Com

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eBusiness: The case of Saudi Arabia

Strengths Weaknesses

Opportunities Threats

• Largest Arab economy• Free market mindset• Large trading community• Good teledensity• Hi growth in PC penetration• Modern infrastructure

Low

•Lack of local IT professionals • High Internet access cost• High implementation cost• Lack of legal environment• Arabization of content•Telcom operator monopoly

•Regional initiatives •WTO (if not prepared)•Cultural backlashes•Internet (if not...)

•Regional economic integration•Reduction in overhead costs•Expanding markets•Trade barriers coming down

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Conclusions

E-Business is about business.IT deployment decisions are

business/investment decisions.IT investments make well-managed

companies better, and poorly-managed companies worse.