1. Define ERP

Enterprise resource planning (ERP) is an enterprise-wide information system designed to coordinate all the resources, information, and activities needed to complete business processes such as order fulfillment or billing.An ERP system supports most of the business system that maintains in a single database the data needed for a variety of business functions such as Manufacturing, Supply Chain Management, Financials, Projects, Human Resources and Customer Relationship Management.

Single Data base: All the data should reside at a single Point

The modular software design : a business can select the modules they need, mix and match modules from different vendors, and add new modules of their own to improve business performance.

Today’s ERP systems can cover a wide range of functions and integrate them into one unified database. For instance, functions such as Human Resources, Supply Chain Management, Customer Relations Management, Financials, Manufacturing functions and Warehouse Management functions were all once stand alone software applications, usually housed with their own database and network, today, they can all fit under one umbrella – the ERP system.

 ERP is often referred to as back-office software. r, ERP takes a customer order and provides a software road map for automating the different steps along the path to fulfilling it. When a customer service representative enters a customer order into an ERP system, he has all the information necessary to complete the order (the customer’s credit rating and order history from the finance module, the company’s inventory levels from the warehouse module and the shipping dock’s trucking schedule from the logistics module, for example).People in these different departments all see the same information and can update it. When one department finishes with the order it is automatically routed via the ERP system to the next department. To find out where the order is at any point, you need only log in to the ERP system and track it down. With luck, the order process moves like a bolt of lightning through the organization, and customers get their orders faster and with fewer errors than before. ERP can apply that same magic to the other major business processes, such as employee benefits or financial reporting.

2. Debate on the necessity of ERP for an Organization

3 and 4. Define Change Management and Importance of Change Management

Change management is a systematic approach to dealing with change both from the perspective of an organization and the individual.

The systematic management of new business model integration into an organization and the ability to adapt this change into the organization so that the transformation enhances the organizational relationships with all its constituents.

Prosci’s definition of change management: Change management is the application of a structured process and set of tools for leading the “people side” of change to achieve a desired outcome.

When change management is done well, people feel engaged in the change process and work collectively towards a common objective, realizing benefits and delivering results.

Importance of Change Mgmt

1) The organization can respond faster to customer demands

1) Managed costs of change: change management helps to contain costs associated with the change. Increased return on investment (ROI).

2) Technology3) Customer Needs4) The Economy5) Growth Opportunities

6)7) It increases project success (it has been found that most often the reason for project failure is resistance of people and bad management of the human element in the project).

8) The success of a project is not only related to good strategy or good technical management. Motivation and skills of the team are also important.

9) Change management is of strategic importance, without which companies cannot exist. Their ability to change and adapt quickly brings enormous market advantages

5. Important modules and sub modules of erp - sd, mm, pp, fi, hr , qm

Enterprise Resource Planning System(ERP), just by considering name we can simply define ERP as System or software that used to manage all the resources of whole enterprise.

Right from employee payments to single screw coming into the enterprise , everything can be managed & tracked by using ERP Systems. ERP is a cross functional software that supports all the business processes within the organization.

In organization , ERP helps to manage business processes of various departments & functions through centralized application. We can make all the major decisions by screening the information provided by ERP.

There are many vendors in market which are providing traditional ERP solutions or Cloud based ERP solutions. Though implementation platforms or technologies are different, there are common & basic modules of ERP which can be found in any ERP System.

Depending on organizations need required components are integrated & customized ERP system is formed. All the below mentioned modules can be found in any ERP system:

1) Human Resource 2) Inventory Sales & Marketing 3) Purchase 4) Finance & Accounting 5) Customer Relationship Management(CRM) 6) Engineering/ Production 7) Supply Chain Management (SCM)

Each component mentioned above is specialized to handle defined business processes of organization. Let us go through the introduction of the various modules.

Human Resource Module(HR):

Human Resource module helps to HR team for efficient management of human resources. HR module helps to manage employee information, track employee records like performance reviews, designations, job descriptions, skill matrix, time & attendance tracking. One of the important sub module in HR module is Payroll System which helps to manage salaries, payment repots etc. It can also includes Travel Expenses & Reimbursement tracking. Employee Training tracking can also managed by ERP.

Inventory Module:

Inventory module can be used to track the stock of items. Items can be identified by unique serial numbers. Using that unique numbers inventory system can keep track of item and trace its current location in organization.

e.g. you have purchased 100 hard disk , so using inventory system you can track how many hard disks are installed , where they are installed, how many hard disks are remaining etc.

Inventory module includes functionalities like inventory control, master units , stock utilization reporting etc.

There may be integration of inventory module with purchase module of ERP.

Sales Module :

Typical sales process includes processes like Sales queries & enquiry analysis & handling, quotation drafting, accepting sales orders, drafting sales invoices with proper taxation, dispatch/Shipment of

material or service, tracking pending sales order . All these sales transactions are managed by sales module of ERP. CRM module can take help of Sales module for future opportunity creation & lead generation.

Purchase Module:

As name indicates, purchase modules take care of all the processes that are part of procurement of items or raw materials that are required for organization. Purchase module consist of functionalities like supplier/vendor listing, supplier & item linking, sending quotation request to vendors, receiving & recording quotations, analysis of quotations, preparing purchase orders, tracking the purchase items, preparing GRNs(Good Receipt Notes) & updating stocks & various reports . Purchase module is integrated with Inventory module & Engineering/production module for updating of stocks.

Finance & Accounting module:

Whole inflow & outflow of money/capital is managed by finance module. This module keeps track of all account related transactions like expenditures, Balance sheet, account ledgers, budgeting, bank statements ,payment receipts, tax management etc. Financial reporting is easy task for this module of ERP. Any Financial data that is required for running business is available on one click in Finance module.

Customer Relationship Management (CRM) module:

CRM department is helps to boost the sales performance through better customer service & establishing the healthy relationship with customers. All the stored details of customer is available in CRM module.

CRM module helps to manage & track detailed information of the customer like communication history ,calls, meetings, details of purchases made by customer, contract duration etc. CRM module can be integrated with Sales module to enhance sales opportunities.

Engineering / Production module:

Production module is great help for manufacturing industry for delivering product.

This module consist of functionalities like production planning, machine scheduling, raw material usage,(Bill of material)preparation, track daily production progress production forecasting & actual production reporting.

Supply Chain Management (SCM):

SCM module manages the flow of product items from manufacturer to consumer & consumer to manufacturer.

Common roles involved are manufacturer, Super Stockiest, Stockiest, distributors, retailers etc. SCM involves demand & supply management , sales returns & replacing process, shipping & transportation tracking etc.

Today many SMBs face challenges in their process automation. ERP is the great help for such organizations. ERP can efficiently streamline the business operations of organization. Above introduction of modules can help you to choose & customize the ERP modules depending on your organizations requirements.

6. Extended Organization and generic ERP diagram for extended organization

7. Important parameters for successful implementation of change management

8. Why ERP implementations fail

Doing it in the first place.

Even before implementation the company is dilemma whether they really require it or not. Often large ERP implementation projects fail before they even start. Companies unhappy with their current system become convinced their reporting, integration, or efficiency problems lie in the software they are using. Convinced the grass is greener on the other side of the fence, they embark on a large, risky, and expensive ERP replacement project, when a simple tune-up of their current system, or a small add-on application, such as a better reporting system or employee portal, would address the problem at a fraction of the cost. Even a reimplementation of the same software is usually less costly than switching to another software vendor.

No clear destination.

To be clear with the expectations. Once an organization makes the decision to implement a new ERP system, the first step is to have a clear definition of success. Often, lack of consensus on the problems being solved, the outcome desired, or the specific financial justification of the project, leads to challenges later controlling the scope and maintaining executive sponsorship. Having a clear destination means defining the important business processes, financial benefits, and deadlines up front and making certain stakeholders agree how to address them. Without a strong definition of success, the end point becomes a moving target.

A good plan or just a plan?

A detailed plan is very necessary for successful implementation. All projects of this size start with some kind of plan. However, more times than not, the plan are not realistic, detailed, or specific enough. Companies build a high-level plan with broad assumptions or underestimate the amount of business change involved. Despite how obvious this sounds, it remains the most common mistake companies make. To be a good plan, it needs to identify all the requirements and the people who are going to work on them. It needs to be at a level of detail where a knowledgeable person can visualize the work, usually

in work blocks of a few days. It needs to have a logical sequence of tasks, like leaving time in the schedule to fix bugs found in test cycles. Until you have a good plan, you really do not know when the project will end or how much it will cost.

Part-time project management.

A person experienced in project management makes lot of difference. There is some debate whether project management is a skill all good managers should have or whether the field will eventually develop into its own professional discipline, just like there are registered engineers, nurses, and lawyers. Putting that debate aside, it is clear software projects of this size need their own dedicated, experienced project managers. Asking the executive sponsor or the business owner to also manage the project as a part-time adjunct to their main role means neither job will be done well. Not just a scorekeeper, the project manager needs to be an active leader pushing for accountability, transparency, and decisiveness.

Under-estimating resources required.

Most common blunder to happen is with resources projected. Having a solid understanding of the internal and external resources needed to complete the project is critical. For internal resources, understanding the time commitment needed from business users, typically in the Finance, Accounting, or Human Resources departments, is one of the most commonly underestimated areas. During critical phases of the project, it is often necessary to backfill the majority of transactional employees by bringing in temporary resources. This frees up the users of the new system so they have time for implementation and training. For external resources, having an agreement up-front with your consultants and contractors about the specific duration, skills, and quantity of resources needed is critical.

Over-reliance on the consultants.

Too much dependability on consultant can make the team more redundant. Most ERP implementation projects involve consultants, for the expertise, best-practices, and additional resources they bring. While their outside experience is definitely helpful for a project, there is a risk that the company can become over-reliant on the consultants. The company needs to maintain control over the key business decisions, hold the consultants accountable, and have an explicit plan to transfer the knowledge from the consultants to the internal employees when the project is winding down.

Customization.

This aspect makes it or breaks it for an ERP tool. Most companies these days understand that customizing their ERP system adds risk, time, and cost to the project. In fact, customizations, along with interfaces and data conversion, are the main areas of technical risk in ERP implementations. Perhaps more surprising is that in a recent survey, less than 20% of respondents implemented their ERP system with little or no customization. Despite the risk and expense of customizations, most companies find it enormously difficult to control the project scope by turning down customizations. Customizations always start out small, but incrementally grow to become the technical challenges that derail these projects. Few ERP implementations have zero customizations, but take a very firm line on justifying even the smallest ones and manage them tightly.

On the job training.

Experience makes a lot of difference. The typical lifespan an ERP system within an organization is 10 to 12 years. With that in mind, most employees in a company have been through one or two ERP implementations in their career. Just as you would not be comfortable with a surgeon as their first or second patient, the leaders of your ERP project, both internal and external, need to have experience implementing your specific chosen system several times. This is one of the major benefits to working closely with an outside consultant or directly with the software vendor.

Insufficient testing.

It should be treated as rectifying stage. When schedules get tight, reducing the number and depth of test cycles is one of the first areas that often get cut. The purpose of testing in an ERP project is not to see if the software works. The purpose is to see if the system meets your business needs and produces the output you need. Reducing testing may not leave defects undiscovered, but it certainly increases the risk the ERP system will be missing important functions or not be well accepted by end users.

Not enough user training.

The management shouldn’t hurry to start using the tool without adequate training to users. Today’s modern ERP systems are being used by more and more personnel within a company. Beyond the Finance and Accounting departments, modern systems also cover procurement, supply chain functions, compliance, customer relationships, sales, and much more. If the system includes human resources or expense reporting, then essentially all employees use the system. Training hundreds or thousands of users, to the right depth, at just the right time, is no easy task. Leaving training to a small phase at the end of the project makes it very difficult for users to get the training they need to understand the system and have a positive first impression at the rollout.

If ERP systems are the nervous system of a company, then doing an ERP implementation is like brain surgery: only to be attempted if there is a really good reason and not to soon be repeated. Unfortunately, ERP implementation projects often fall victim to some of the same problems of any large, complex project. However, there are some repeatable problems that good planning early in a project can work to avoid.

9. Define E-BusinessElectronic Business, commonly referred to as "eBusiness" or "e-Business", may be defined as the utilization of information and communication technologies (ICT) in support of all the activities of business. Commerce constitutes the exchange of products and services between businesses, groups and individuals and hence can be seen as one of the essential activities of any business. Hence, electronic commerce or eCommerce focuses on the use of ICT to enable the external activities and relationships of the business with individuals, groups and other businesses. Louis Gerstner, the former CEO of IBM, in his book, Who Says Elephants Can't Dance?attributes the term "e-Business" to IBM's marketing and Internet teams in 1996. Electronic business methods enable companies to link their internal and external data processing systems more efficiently and flexibly, to work more closely with suppliers and partners, and to better satisfy the needs and expectations of their customers.

In practice, e-business is more than just e-commerce. While e-business refers to more strategic focus with an emphasis on the functions that occur using electronic capabilities, e-commerce is a subset of an overall e-business strategy. E-commerce seeks to add revenue streams using the World Wide Web or the Internet to build and enhance relationships with clients and partners and to improve efficiency using the Empty Vessel strategy. Often, e-commerce involves the application of knowledge management systems. E-business involves business processes spanning the entire value chain: electronic purchasing and supply chain management, processing orders electronically, handling customer service, and cooperating with business partners. Special technical standards for e-business facilitate the exchange of data between companies. E-business software solutions allow the integration of intra and inter firm business processes. E-business can be conducted using the Web, the Internet, intranets, extranets, or some combination of these.

Business Model

When organizations go online, they have to decide which e-business models best suit their goals. A business model is defined as the organization of product, service and information flows, and the source of revenues and benefits for suppliers and customers. The concept of e-business model is the same but used in the online presence. The following is a list of the currently most adopted e-business models such as: * E-shops * E-commerce * E-procurement * E-malls * E-auctions * Virtual Communities * Collaboration Platforms * Third-party Marketplaces * Value-chain Integrators * Value-chain Service Providers * Information Brokerage * Telecommunication

EBusinessCategory :

Roughly dividing the world into providers/producers and consumers/clients one can classify e- businesses into the following categories: * business-to-business (B2B) * business-to-consumer (B2C) * business-to-employee (B2E) * business-to-government (B2G) * government-to-business (G2B) * government-to-government (G2G)

government-to-citizen (G2C) * consumer-to-consumer (C2C) * consumer-to-business (C2B)

Business-to-business (B2B) describes commerce transactions between businesses, such as between a manufacturer and a wholesaler, or between a wholesaler and a retailer. Contrasting terms are business- to-consumer (B2C) and business-to-government (B2G). The volume of B2B transactions is much higher than the volume of B2C transactions. The primary reason for this is that in a typical supply chain there will be many B2B transactions involving subcomponent or raw materials, and only one B2C transaction, specifically sale of the finished product to the end customer. For example, an automobile manufacturer makes several B2B transactions such as buying tires, glass for windshields, and rubber hoses for its vehicles. The final transaction, a finished vehicle sold to the consumer, is a single (B2C) transaction.

Consumer-to-consumer (C2C) (or citizen-to-citizen) electronic commerce involves the electronically-facilitated transactions between consumers through some third party. A common example is the online auction, in which a consumer posts an item for sale and other consumers bid to purchase it; the third party generally charges a flat fee or commission. The sites are only intermediaries, just there to match consumers. They do not have to check quality of the products being offered.

10. What is e-Business importance in today’s connected worldElectronic Business, also known as "e-Business" or "e-Business", is defined as the utilisation of information and communication technologies (ICT) in support of all the activities of business. Commerce constitutes the exchange of products and services between businesses, groups and individuals and hence can be seen as one of the essential activities of any business. Hence, electronic commerce or e-Commerce focuses on the use of ICT to enable the external activities and relationships of the business with individuals, groups and other businesses.

Electronic business methods enable companies to link their internal and external data processing systems more efficiently and flexibly, to work more closely with suppliers and partners, and to better satisfy the needs and expectations of their customers.

In practice, e-business is more than just e-commerce. While e-business refers to more strategic focus with an emphasis on the functions that occur using electronic capabilities, e-commerce is a subset of an overall e-business strategy. E-commerce seeks to add revenue streams using the World Wide Web or the internet to build and enhance relationships with clients and partners and to improve efficiency using the empty vessel strategy. Often, e-commerce involves the application of knowledge management systems.

E-business involves business processes spanning the entire value chain: electronic purchasing and supply chain management, processing orders electronically, handling customer service, and cooperating with business partners. Special technical standards for e-business facilitate the exchange of data between companies. E-business software solutions allow the integration of intra and inter firm business processes. E-business can be conducted using the web, the internet, intranets, extranets, or some combination of these.

Activities using e-Business tools include:

Trading of goods or services online, such as e-Procurement, primarily through the web-sites;

Electronic retailing (e-Tailing);

Use of the internet, intranets or extranets to conduct research and manage business activities;

Web-site marketing;

Online communications, such as e-mail; and

Online training for staff (e-Learning).

E-Business tools include:

Mobile phones; Personal digital assistants (PDA);

Electronic Data Interchange;

File transfer;

Facsimile;

Video conferencing, internet, intranets and extranets.

Advantages:

The benefits of implementing e-Business tools is not so much in the use of technology, but in the streamlining of business processes and the ease in finding new markets. Some of the advantages and disadvantages include:

Quicker and easier communications. Strengthened marketing capabilities and reach.

Increased hours of operation (a web-site provides 24-hour seven day information to existing and potential customers).

Access to broader information through research.

Reducing the cost of doing business by lowering transaction costs and increasing efficient methods for payment, such as using online banking and reducing stationery and postage costs.

The opportunities to adopt new business models and develop tailored customer support.

11. Benefits and challenges of e-business usageThe internet and the emergence of e-business have provided entrepreneurs with many new advantages and opportunities. The internet has created a business environment in which time and distance are less important, people have access to more information to help them make decisions and consumers have better access to a broader range of products and services.

A significant benefit for entrepreneurs is that the initial investment for starting up an e-business is generally lower than the costs associated with starting an equivalent business using a traditional model. The technology used to setup and operate an e-business is becoming more advanced whilst also becoming cheaper to obtain. Many successful e-businesses are started using only a home based office with a personal computer, some basic software and a connection to the internet.

Low start-up costs mean that more people are able to enter the market E-business Advantages with their business ideas. Many of the barriers to opening your own business have been reduced or removed, with many people able to operate an e-business whilst remaining employed in their regular day job. People who lacked the confidence to start a full scale business are now able to test their abilities and ideas online for a relatively small initial outlay.

The increases in technology and falling prices also provide online businesses with a steady stream of new customers as more people move online to shop for products and services. Cost and access is becoming less of a barrier for consumers and people are becoming increasingly comfortable with making purchasers online.

E-business makes it easier, faster and cheaper for businesses to communicate with their suppliers and their customers. Using email and online ordering systems, communication and transactions can occur almost instantly between organizations situated anywhere in the world.

The internet is accessible twenty-four hours a day, seven days a week. This means that buyers and sellers can conduct transactions at any time, as opposed to the regular trading hours of traditional business models. The internet can also make it easier and more cost effective for business managers to track and analyze the buying patterns of their customers, and in turn tailor the business to better suit their needs and expectations.

E-business can provide cost saving advantages for both buyers and sellers. Online sellers are able to reduce their overheads as they don't need expensive shop fronts, as many employees or need to hold as much inventory on hand. In turn, this allows them to reduce their prices and pass the savings on to their customers, who save time and money by shopping from their own homes. The fact that consumers have such wide access to a diverse range of sellers also helps them to save money as they can search, shop around and compare prices quickly and easily.

Benefits of E-Business

Cost-Effective Marketing

With an e-business, all of your marketing efforts end with one goal—to drive target traffic to your business website. With one central place to send customers—your e-business website—it allows you to use many online marketing tactics including email marketing, article marketing, social media networking and e-newsletters. Most of these online marketing efforts are very low cost or free, so an e-business allows for highly cost-effective marketing strategies.

Flexible Business Hours

E-business breaks down the time barriers that location-based businesses encounter, according to eCommerce Education. Because the Internet is available 24 hours a day, seven days a week, your business never closes. An e-business can literally be making money while you are fast asleep.

Eliminates Geographic Boundaries

An e-business also allows you to broaden your reach. An online business can reach customers in the four corners of the Earth. As long as someone has an Internet connection, you may be able to reach and sell your product or service to these visitors to your business website.

Reduces Transaction Cost

Running an online business reduces the cost per transaction because it takes less manpower to complete an online transaction. Once you get your website up and running, the customer places the order online, which removes the need for a salesperson. The customer payment goes through your online payment processing software or system and again eliminating the need for a store clerk. Someone has to download the order and ship it, which is probably you, but an e-business transaction has less burden of cost on the business, making each transaction more cost effective than a brick-and-mortar business.

Low Overhead Costs

Running an e-business cut back or out most of the costs involved in running a physical location. E-businesses have less expensive phone, rent and utility bills than businesses with physical locations. Some e-businesses do not require any additional space and can be run out of your home, which you are already paying rent for or your mortgage payment. Even housing inventory may not be an issue because you may be able to establish a drop-shipping situation, where your wholesaler ships orders for you on behalf of your business.

Challenges of E-Business

The rapidly changing business environment has led several companies to adopt e-commerce. E-Business brings about a lot of changes in the way firms work. It also throws up challenges that they have to meet in order to reap the benefits of e-commerce. The various challenges to businesses include technological challenges, legal and regulatory challenges, behavioral and educational challenges, and other miscellaneous challenges. Various issues pertaining to the implementation of new technology include security issues, choice of Internet payment instrument and its inter-operability, inter-operability of technology and technological application, comparative buying capabilities, richness and depth of information available over the Internet, lack of reliable network infrastructure, lack of e-commerce

standards, deployment of public key infrastructure to enable identity authentication, technical integration of new technology with existing applications, and high cost of bandwidth. Challenges associated with legal and regulatory framework include the difficulty in regulating and enforcing standards, due to lack of consistent rules and policies; customs and taxation uncertainties; and government intervention.

Changes in attitudes of consumers result in behavioral challenges to businesses. These challenges include lack of trust of customers and their fear of intrusion of privacy which makes them reluctant to involve in e-transactions. In addition, the rampant frauds taking place over the Internet and lack of awareness of customers about the availability of services poses a challenge to businesses. Miscellaneous challenges such as channel conflict, the problem of attracting and retaining a critical mass of customers, and the need to improve the order fulfillment process, are the other aspects that have become a cause of worry to businesses.

12. What is Revenue model of a e-business company? You can select any company of your choice from eBay, Localbanya, Paytm, Amazon, Snap deal, Flipcart etc

Selling products online can be a profitable business. As e-commerce has developed, many options have emerged for creating revenue online. An e-commerce revenue model is a plan for generating revenue for an online business. While e-commerce revenue models share many similarities with brick-and-mortar businesses, they also enable you to reach customers around the globe and offer more diverse methods of generating sales. These models can be helpful in determining how to structure your e-commerce business.

Five Common Revenue ModelsWhile there are many ways to earn money online, you may want to consider these five common e-commerce revenue models when planning your business.

Affiliate marketing enables you to earn revenue by marketing or offering another product for sale on your site. For example, you may reference a book you read and recommend your customers get a copy for themselves. You could also set up an affiliate account and place a direct link to the book on the Amazon site, which will pay you a percentage of the sale. If you decide to participate in affiliate marketing, you'll need to research which companies might provide you with a financial incentive for promoting their sites on your page.

When you're just starting out, the money you earn from affiliate marketing may be just a small, supplemental amount. However, as traffic to your site increases, you may enjoy more substantial income.

Online advertising is a very popular revenue model for e-commerce businesses. In this method, companies or organizations buy advertising space on your site, provide a designed add or written message and then pay you for promoting their messages. Media sites, such as magazines, newspapers and television channels typically use online advertising.

Two common types of online advertising include pay-per-click and pay-per-view, which determine how much advertisers will pay for their advertisements. While some sites charge a set fee for placing an ad, most pay a set fee for each person who clicks on a link or views a page related to the advertiser. As traffic to your site grows, and more people click on an advertiser's link or view a related page, you'll earn more advertising revenue.

Transaction fees are the charges a company pays for using their service. If you've ever sold anything on eBay, you know there's a set price for posting a product for sale. Each time a transaction happens, you pay a small fee to eBay for marketing your product. Whether you charge a small fee for a company to list a transaction or for someone to view a video, transaction fees can be a sizable if the traffic to the website is substantial.

Subscription based services allow customers to access a library of information or entertainment, join a community or receive an on-going service for a set fee. Dating sites are common subscription models where members pay a set fee to interact with other members. Additionally, services like Netflix and Amazon Prime offer member-specific benefits for those who pay a monthly fee. For example, members may get free movies and books or discounts on other products.

Please add example of any company

13. What are similarities and differences between eCommerce and eBusiness

E-commerceE-commerce refers specifically to online transactions involving the purchase or sale of goods or services. For example, the sale of books over Amazon.com's website is an example of e-commerce activity. Small businesses can expand by developing a business model around e-commerce, reaching customers in distant locations without having to deal with the cost of brick-and-mortar locations.

E-Commerce TypesE-commerce branches into two major groups: online purchasing and online shopping. Online purchasing businesses offer customers the ability to find information, place orders, request quotes or prices and submit purchase orders. Online shopping businesses provide information about products so that consumers can make a decision whether or not to purchase a product. Many e-commerce businesses practice online shopping and purchasing strategies to assemble an online store.

E-businessWhile e-business also covers online transactions that would constitute e-commerce, it covers a broad range of other activities beyond buying and selling goods and services. Therefore, e-commerce can be said to be a subset of e-business. E-business activities can include virtually all elements of running a business, simply moved to an online setting.

E-Business Types And StrategyAccording to E-business at Ohio State University, “E-business can work for any business because it involves the whole business cycle from production, procurement, distribution, sales, payment, fulfillment, restocking and marketing.” Business strategy is complicated, as it involves four directions of planning: vertically, laterally, horizontally and downward. Vertical planning coordinates website front and back-end systems and horizontal planning coordinates e-commerce with customer relationships, supply-chain management and resource planning. Laterally, you must manage customers, business partners and suppliers while at the same time integrating new technologies and business processes downward through the organization.

Comparison Chart

BASIS FOR COMPARISON E-COMMERCE E-BUSINESS

Meaning Trading of merchandise, over the

internet is known as E-commerce.

Running business using the

internet is known as E-business.

What is it? Subset Superset

Is it limited to monetary

transactions?

Yes No

What they carry out? Commercial transactions Business transactions

Approach Extroverted Ambiverted

Requires Website Website, CRM, ERP, etc.

Which network is used? Internet Internet, Intranet and Extranet.

Definition of e-commerce

e-commerce is an abbreviation used for electronic commerce. It is the process through which the

buying, selling, dealing, ordering and paying for the goods and services are done over the internet is

known as e-commerce. In this type of online commercial transaction, the seller can communicate with

the buyer without having face to face interaction.

Some examples of real world application of e-commerce are online banking, online shopping, online

ticket booking, social networking etc.

The basic requirement of e-commerce is a website. The marketing, advertising, selling and conducting

transaction are done with the help of internet. Any monetary transaction, which is done with the help of

electronic media is e-commerce. The following are the types of e-commerce:

B2B – The process where buying and selling of goods and services between businesses is known

as Business to Business. Example: Oracle, Alibaba, Qualcomm etc.

B2C – The process whereby the goods are sold by business to customer. Example: Intel, Dell etc.

C2C – The commercial transaction between customer to customer. Example: OLX, Quickr etc.

C2B – The commercial transaction between customer to business.

Definition of e-business

Electronic Business, shortly known as e-business, is the online presence of a business. It can also be

defined as the business which is done with the help of internet or electronic data interchange i.e. is

known as E-business. E-commerce is one of the important component of e-business, but it is not an

essential part.

e-business is not confined to buying and selling of goods only, but it includes other activities that are

also forms part of business like providing services to the customers, communicating with employees,

client or business partners can contact the company in case if they want to have a word with the

company or they have any issue regarding the services, etc. All the basic business operations are done

using electronic media. There are two types of e-business, which are:

Pure-Play : The business which is having an electronic existence only.

Brick and Click: The business model, in which the business exists both in online i.e. electronic

and offline i.e. physical mode.

Key Differences Between e-commerce and e-business

The following are the major differences between e-commerce and e-business:

1. Buying and Selling of goods and services through the internet is known as e-commerce. Unlike e-

business, which is an electronic presence of a business, by which all the business activities are

conducted through the internet.

2. e-commerce is a major component of e-business.

3. e-commerce includes transactions which are related to money, but e-business, includes

monetary as well as allied activities.

4. e-commerce has an extroverted approach that covers customers, suppliers, distributors, etc. On

the other hand, e-business has an ambiverted approach that covers internal as well as external

processes.

5. e-commerce requires a website that can represent the business. Conversely, e-business requires

a website, Customer Relationship Management and Enterprise Resource Planning for running

business over the internet.

6. e-commerce uses the internet to connect with the rest of the world. In contrast to e-business,

internet, intranet and extranet are used for connecting with the parties .

Similarities :

A Service-oriented Website

Both e-commerce and e-business owners maintain service-oriented websites and work to

cultivate an online presence. But while the primary goal of e-commerce websites is to sell a product or

service, the primary goal of an e-business website is usually to provide customers with information

about a product or service to inform them and help them to make better purchasing decisions.

Encouraging Customer Interaction

An e-business encourages customer or visitor interaction through the use of online feedback

forms, surveys and polls. Many e-businesses also have their own online forums, allowing users to further

their interaction both with the company and with one another. E-commerce websites also encourage

interaction, but the opportunities for interaction that they provide are usually centered around the

products and services that they sell in the form of product reviews and product ratings.

Establishment of Partner Relationships

Both simple e-commerce websites and full-service e-businesses encourage and foster

relationships between service and vendor partners. This type of interaction between businesses is often

necessary to allow companies to provide their customers with additions, accessories or add-ons to the

products and services that they market and sell.

Similar Business Models

Since e-commerce is a subset of e-business, it makes sense that both websites that provide e-

business services, including e-commerce, and websites that focus only on the buying and selling expert

of e-commerce should have similar business models. Both are focused on the idea of selling products

and services and providing customer service, support and information if necessary. A straight e-

commerce site, however, focuses only on buying and selling, providing the minimal amount of

information to the consumer.