E- Commerce: Any computer transaction that occurs when data are processed and transmitted over the internet.
E-business: The full breadth of activities included in a successful internet based enterprise.
Let’s begin by clarifying some concepts. Two terms that seem to cause considerable confusion are e-commerce and e-business. The term e-commerce is becoming the standard label for the sales side of electronic business. It encompasses presenting products on Websites and filling orders. The vast majority of articles and media attention given to using the Internet in business are directed at online shopping – marketing and selling goods and services over the Internet. You hear about the tremendous number of people who are shopping on the Internet – how businesses can set up Web sites where they can sell goods, conduct transactions, get paid, and fulfill orders – you’re hearing about e-commerce. It’s a dramatic change in the way a firm relates to its customers and e-commerce is exploding. Global e-commerce spending is in the trillions of dollars.
In contrast, e-business refers to the full breadth of activities included in a successful internet based enterprise. It includes developing strategies for running Internet based companies improving communication between employees, customers, and suppliers and collaborating with partners to electronically coordinate design and production. And the term e-organization is merely application of e-business concepts to all organizations. E-orgs include not only business firms, but also hospitals schools, museums, government agencies, and the military. For instance Indian railways is an e-organization because it now provides passengers access to information and booking over the Internet.
The best way to understand the e-organizations concept is to look at its three underlying concepts; the intranets, and extranets. The Internet is a worldwide network of interconnected computers; intranets are an organization’s private Internet; and extranets are extended intranets, accessible only to selected employees and authorized outsiders. As Exhibit, an e-organization is defined by the degree to which it uses global (Internet) and private (intranet an extranet) network linkages. Type ‘A’s are traditional organizations such as small retailers and service firms. Most organizations today fall in to this category. Type ‘B’s are contemporary organizations with heavy reliance on intranets and extranets; Type ‘C’s are small e-commerce firms; and finally, Type ‘D’s are full e-organizations with completely integrated global and private networks. Type Ds include such firms as e-Bay, Cisco Systems, Amazon.com, and Wal-Mart. Note that as an organization moves from Type A toward Type D, it increases the degree to which it takes on e-org properties.
Although numerous stories tell of the sudden rise of e-organizations and the unheralded wealth created by these companies, readers must recognize that many of these organizations have typically been viewed as high reward ventures. But that’s simply not the case. Many have failed miserably. The Internet created thousands of new businesses; it changed the way operated. And even though it left a lot of road kill, the picture isn’t all gloomy. Internet use by individuals and organized members is growing significantly each year. As technology continues to evolve and management learns to better manage the e-organizations we can expects its resurgence.
E–organizations as they affect four components of the management process: planning, organizing, leading and controlling. For our purposes here, let’s go back to the larger picture the effect of technology on a manager’s job.
Technology has had a positive effect on the internal operations of organizations, but it has also changed the manager’s job. Organizations today become integrative communication centers. By linking computers, telephones, fax machines, copiers, printers, and the like managers can get complete information quickly.