Managing

E-Business
Contents
▸ Managing knowledge
▸ Data, Information, Knowledge
▸ Information Systems
▸ Knowledge Management
▸ Knowledge Management in E-Business
▸ Management Skills for E-Business Leaders
▸ Managing Knowledge in E-Business

2
Introduction
▸ E-Business comprises a vast amount of data that can be processed into information
▸ Data can be
▹ Internal transactions of an administrative or logistical statistics
▹ External information of buyers , etc.
▸ Data can be collected and structured but cannot be used as a basis to make decision
▸ Raw and collected data is processed using tools and analytical algorithms
▹ This transforms data into information that can be used by knowledge workers for decision making

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Data

▸ Used for communication,

▸ Raw, non-summarized ,
interpretation or
and unanalyzed facts
processing by an
and figures
individual or system
▸ Simple representation
of a fact, concept or
instructions in a formal
manner

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Information
▸ Data that has been
converted into a ▸ Processed data on which
meaningful and useful actions or decisions can
context for the receiver be taken
▸ Organised or structured ▸
For meaningful decision
data that has an making, information
intended meaning for must be:
its users
▹ Timely
▹ Accurate
▹ Complete

5
Data Processing Cycle

Input Analytical Output

(Data) Tools (Informati
(Processi on)
ng)

6
 Knowledge Knowledge
(Know-how, understanding,
experience, insight, intuition and
contextualized information)
▸ Information is
transformed into ▸ Information when Information
knowledge when it is enhanced by the (Contextualised, categorised,
processed, calculated and condensed
used to make decisions experiences and data)
and take appropriate competence of
actions knowledge makers to
▸ “Processed solve complex Data
information” that helps organisation’s issues… it (Facts and Figures)
in specific domain becomes knowledge

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Information System (IS)
▸ Integrated set of components that are used to collect store and
process data
▸ Helps in
▹ Providing information and knowledge
▹ Interacting with customers and suppliers
▹ Processing accounts, managing HR, etc.

8
 Communication Globalisation Availability

Advantages of IS Cost
Creation of new
effectiveness and
Job
▸ Communication productivity

▹ Helps in cost reduction ▸ Availability

in various IT services ▹ Businesses available around the
such as IMs, e-mails, clock across the globe
voice and video calls
▹ Access any business anytime
▹ Quick, cheaper a more
anywhere
efficient
▹ Purchase geographically distant
▸
item easily and conveniently
▸ Globalisation
▹ IS has reduced linguistic, geographical as
well as cultural boundaries across the globe
▹ Made it easy to share information,
knowledge and communication across
boundaries

9
 Advantages of IS Communication Globalisation Availability

▸ Creation of new Jobs ▸ Cost-effectiveness and Cost

Creation of new
▹ Job opportunities in IT productivity Job
effectiveness and
productivity
sector (programmers, ▹ Improves efficiency
analyst, hardware and ▹ Improves transmission
software developers) of information to
▹ decision-makers
▸

10
 Components of IS
Components of Information System

Hardware Procedure Software Database Network

Hardware Database Procedure

Computer Hardware such as To store data organised into tables Procedure for processing and analysing
processors, monitors, keyboards, and files data to retrieve relevant information
printers etc

Software Network
Programs used to collect, organise, Components that must be
process and analyse data connected to each other
Network Infrastructure,
connectivity

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Types of IS
▸ Classification of IS Based on Decision Making
▹ Transaction Processing Systems
EIS
▹ Operational level decisions taken on a daily basis for
(Strategic
Decisions) managing a business
▹ Real time processing, keeps track of basic activities
MIS and transactions in an organization
(Tactical ▹ E.g. fund transfer, invoice generation, sales receipts,
Decisions) cash deposits, payroll, credit decisions, flow of
materials in factory
Transaction ▹ Activities: Data Collection, Data Editing, Data
Processing Systems Correction, Data Manipulation, Data Storage,
(Operational Document Production and Reports
Decisions)

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 Types of IS
▸ Management Information Systems
▹ Middle Management level decisions
▹ Helps with monitoring, controlling,
decision-making and administrative
activities
▹ Information Reporting Systems
▹ E.g. Annual Sales/Inventory Report
▹ Decision Support Systems, Group
Decision Support Systems

13
 Types of IS (Classification of IS
▸
Based on Decision Making)
Executive Information Systems
▹ Serve Senior Managers
▹ Address strategic issues and long term
trends
▹ Which product should we launch
in 5 years?
▹ Non routine decision making
▹ Draw summarized information from
MIS, DSS and data from external events

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Types of IS based on
Processed Data
▸ Basic data required by TPS and OSS such as invoices,
Tacit Knowledge
EIS order number etc
▸ Data is processed by MIS to retreive relevant
DSS information from processed data
Explicit Knowledge ▸ DSS processes information and infers knowledge
from the obtained information so that an
MIS appropriate decision can be implemented
Information
▸ EIS implements decision chosen from alternate
Office Support decisions
Systems
Basic Data
TPS

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Types of IS based on People
▸ TPS used by workers who form the bottom
Executives
management of an organisation
EIS ▸ MIS used by middle managers to take low level
control and administrative decisions
DSS Senior Managers ▸ DSS used by senior managers to extract alternate
choices and decisions
Middle Managers ▸ ESS used by top level executives to evaluate
MIS alternate choices and make decisions

Workers
TPS

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TPS
▸ Offers a platform to ▸ Functions performed by ▸ Outputs provided by TPS
collect, process, store, TPS are are
display, modify or cancel ▹ Processing ▹ Lists of transactions
transactions
▹ Validating ▹ Data about
▸ Data collected thru TPS
▹ Sorting users/customers/
stored in databases
▹ Listing items etc.
▸ Inputs provided to TPS
are ▹ Merging
▹ Data about ▹ Updating
users/products ▹ Calculating
▹ Transactions

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MIS
▸ Mostly used by middle ▸ Inputs provided to MIS are ▸ Outputs provided by MIS
management ▹ Internal Files are
▸ Aids in smooth ▹ Internal Transactions ▹ Summary Reports
functioning of an
organisation for a short ▹ Structured data ▹ Detailed Reports
time period ▹ Action Reports
▸ Allows middle managers ▸ Functions performed by MIS
to analyse performance are
of an organisation by ▹ Sorting
comparing current
information with ▹ Merging
previous ▹ Summarising

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 DSS
▸ Basically a knowledge-based ▸ Inputs provided to DSS are ▸ Outputs provided by MIS
system ▹ Internal Files are
▸ Used by senior managers or ▹ Internal Transactions ▹ Summary Reports
upper-middle management ▹ Forecasts
▸ Required to create knowledge ▸ Functions performed by MIS
or information from internal or are
external data
▹ Modelling
▸ Analyses the existing
structured information with the ▹ Simulation
ability to forecast potential ▹ Analysing
effects of the implemented ▹ Summarisation
decisions in future

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EIS
▸ Strategic level IS forming ▸ Inputs ▸ Outputs
the top of pyramid
▹ External data ▹ Summary report
▸ Helps executive and
senior managers to ▹ Internal files ▹ Graphs/plots
analyse the environment ▹ Predefined models
of an organisation, to ▸
identify long-term trend Functions performed by
EIS
▸ Mostly structured ▹ Summarising
information processed
from internal as well as ▹ Simulation
external data sources

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Evolution of IS
IS is an integration of process, hardware, trained Year 1950-1960 1960-1970 1970-1980
personnel, infrastructure as well as standards
Information Data Management Decision
Used to create, modify, store, manage and Systems Processing Reporting Support
distribute information
Helps manage business strategies and effective Functions Collect, store, Create pre- Provide
modify, specific report interactive
communication channels, leading to better retrieve day to and support support for
decision-making process day decision decision
transactions of making of an making
an organisation process
organisation

Supports Workers Middle Senior

Managers Managers

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Evolution of IS
Year 1980-1990 1990-2000 2000-present

Information Executive Knowledge E-Business

Systems Support Management

Functions Support for Support the Offer greater

internal and structural connectivity and
external organisation integration
information that and amongst e-
helps in dissemination of businesses
accomplishing knowledge
strategic goals
of an
organisation

Supports Executives Enterprise Global e-

globally business

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 Evolution of IS…
▸ 1950-1960 (EDP, TPS) ▸ 1960-1970 (EDP to MIS)
▹ Role of IS was very simple .. ▹ Another role was added to the use of computers i.e.
Mainly used for EDP processing data to useful reports
▹ Performing activities like ▹ These helped managers organise evaluate and efficiently
transaction processing, manage departments whithin an organisation
record keeping and ▹ Types of information generated
accounting ▹ Detailed information report confirming transaction-
▹ Mainly used by clerical staff processing activities
▹ Summary information report organising data into a
format that can be reviewed and understood easily
▹ Exception information reports to help managers save
time

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 Evolution of IS…
▸ 1970-1980(PC and DSS)
▹ Advent of the Personal Computer
▹ Organizations began to distribute their processing/computing power across the organization
▹ Organizations took a stronger management orientation to their traditionally technical-oriented
approach to IS operations
▹ The movement started focusing on “interactive computer-based system” to aid decision-makers in
resolving problems
▹ Predefined management reports were not sufficient to meet the decision-making needs anymore…
hence DSS was conceptualized
▹ DSS used data from internal and external sources to provide for adhoc support for the decision
making process

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 Evolution of IS…
▸ 1980-1990(EIS)
▹ Personal computing to departmental computing
▹ Many business units resorted to purchasing their own hardware and software to suit their
departmental needs
▹ This trend led to new challenges of data incompatibility, connectivity and integrity across
functional departments
▹ Most top executives did not use either MIS reports or the analytical modelling capabilities of DSS,
so the concept of executive information systems (EIS) was developed (also known as ESS)

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 Evolution of IS…
▸ 1990-2000 (AI, ES, KMS)
▹ Commercialization of the Internet enabled new methods of communication and ways of
conducting business that were not possible in the previous eras
▹ Breakthroughs occurred in the development and application of artificial intelligence (AI)
techniques to business information systems
▹ With less need for human intervention, knowledge workers could be freed up to handle more
complex tasks
▹ Led to advent of ES, KMS to support an organisation as well as the distribution of the business
knowledge within the organisation

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 Evolution of IS…
▸ 2000-present (E-business)
▹ Internet changed the way business was being performed, hence changed the capabilities of IS in
business
▹ Information systems are still doing the same basic things just like 50 years ago from transactions
processing, records keeping, reporting management and support management to the accounting
system as well as processes of the organization
▹ What has changed is greater connectivity across similar and dissimilar system components, much
higher level of integration of system functions across applications, great network infrastructure
and powerful machines with higher storage capacity

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Knowledge Types of
Knowledge

Explicit Tacit Embedde

Explicit: Validated, know-what knowledge.
◦ Easy to identify, retrieve and store
◦ Found in databases, memos, notes, documents, transaction details.

Tacit: based on experience, know-how knowledge

◦ Context dependent and personal in nature
◦ Can reduce invocation capability and sustained competitiveness
◦ Mostly found in minds of stakeholders
◦ Comprises cultural beliefs, values, attitudes and capabilities
◦ E.g. rules of purchase

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Knowledge Types of
Knowledge

Explicit Tacit Embedde

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Knowledge Types of
Knowledge

Explicit Tacit Embedde

Embedded: mostly gathered from processes, routines, artefacts or structures
◦ Either present formally such as different management initiatives, which helps in formalising beneficial routines, or
informally such as uses of an organisation
◦ Found in rules, processes, manuals, ethics and organisational culture

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Knowledge Management
(KM)
Infer the right knowledge and make it available to the right people at the right time ensuring that the learning
process of an organisation is not hampered
“Coordination and exploitation of organisational knowledge resources, to create benefit and competitive
advantage”
Refers to systematic management of knowledge assets to meet the statistical and tactical requirements of an
organisation
Includes various initiatives processes and strategies that help in storing, sharing, refining and creating valuable
knowledge
Helps to implicate organisational goals and strengths

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KM Advantages

Helps an organisation learn from past mistakes and successes

Helps analyse the knowledge assets and redeploying them in the areas that can be beneficial

Helps focus and develop correct competencies and skills

Helps remove obsolete knowledge

Helps increase the innovation capabilities

Helps enhance security of important knowledge being lost and stolen

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KM in e-business
▸ Management of knowledge helps increase customer-centric focus
▸ Organisation must have the proper knowledge about its market,
customers, services, processes and employee skills
▸ Helps extract proper value from internal as well as external
knowledge
▸ Aspects of KM related to e-business
▹ Retrieving, storing, locating and updating the information for
the benefit of an organisation which helps in process and
product development
▹ Sharing and disseminating the contextual information which
helps in the benefit of customers and partners 33
Benefits of KM in e-
business

Analysing customer-suppliers trends

Analysing organisational trends

Predicting future trends

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Benefits of KM in e-
business
▸ Analysing customer-supplier oriented trends
▹ Using questionnaires or surveys for collecting the information
▹ Collected using various sources like customers, suppliers etc.
and evaluated and categorised to infer valuable knowledge
▹ Helps in organising and evaluating the customers’ and
suppliers’ relationships and requirements
▹ Helps in meeting customers and suppliers demands by taking
appropriate action

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Benefits of KM in e-
business
▸ Analysing organisational trends
▹ Analysing, filtering and storing the organisation-related
knowledge in a repository helps to predict organisational
trends
▹ Helps in formulating e-business strategy
▸ Predicting future trends
▹ KM helps gain information related to market competition, new
customer demands etc. using the internet
▹ Helps organisation select appropriate e-business models and
prepare the e-marketing plan
▹ Also helps predict the competition level, hence take an 36
 KM Roadmap
Evaluating Creating Creating a Evaluating
Infrastructure Blueprints structure Benefits

▸ Evaluating Infrastructure
▹ Analysing existing infrastructure
▹ Aligning KM and Business strategy
▹ Designing KM architecture and integrating existing
infrastructure
▹ Auditing and Analysing existing knowledge
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 KM Roadmap
Evaluating Creating Creating a Evaluating
Infrastructure Blueprints structure Benefits

▸ Creating Blueprints
▹ KM blueprint
▸ Creating a structure
▹ Developing the KM system
▹ Deploying with Results Driven Implementation (RDI)
Methodology
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 KM Roadmap
Evaluating Creating Creating a Evaluating
Infrastructure Blueprints structure Benefits

▸ Evaluating Benefits
▹ Measuring results of KM, devising ROI metrics and evaluating
system performance
▹ This phase helps upgrade the KM roadmap for more potential
advantages

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Management Skills for E-
Business Leaders
Strategic Approach

Data Analytics capabilities

Collaboration/ relationship making/ influence maker

Operational and Project Management expertise

40
Management Skills for E-Business
Leaders
▸ Strategic Approach
▹ Must hold the vision of the e-commerce organisation
▹ Ability to explore long-term business opportunities
▹ Must be able to perform effective research on customer data
to drive online business
▸ Data and Analytic Capabilities
▹ Ability to analyse market trends and test results to predict
future trends for success of business
▹ Its important that the leader must be able to interpret data
properly and effectively
41
 Management Skills for E-Business
Leaders
▸ Collaboration/Relationship Making/Influence Maker:
▹ Leaders must communicate effectively with all departments such
as supply chain, financial, inventory etc. of an organisation
▹ Effective communication with suppliers and vendors
▹ Cross-collaboration and interpersonal skills key part of the job
▸ Operational and Project Management expertise
▹ Expertise to choose the right strategy to convert online visitors
into paying customers
▹ Necessary to chose correct strategy/technology to help achieve
long term goals
▹ Proper understanding of metrics such as AOV (Average Order 42
Managing Risks in E-
Business
Educate staff on e-commerce risks

Using correct payment processor

Create only essential website content

Focus on risk reduction

Prevent internal fraud

Use proper fraud prevention tools

43
Managing Risks in E-
Business
Secure routing process

Minimise unnecessary chargebacks

Ensure PCI compliance

Prevent merchant account from intrusion

Contribute in verified by Visa and MasterCard SecureCode

44
 Managing risks in E-business
▸ Educate staff on e-commerce risks
▹ Risk exposure largely depends on business policies, operational practices, the fraud detection and prevention tools
implemented, security controls, and the types of products and services that a company provide
▹ Staff should understand the risks associated with online transactions and be able to follow the established risk
management procedures
▸ Use a correct payment processor:
▹ A correct credit card/payment processing organisation provides effective risk management support
▹ Helps in understanding specific e-commerce fraud risks and liabilities
▹ Ensure that payment processor offers adequate data protection

45
 Managing risks in E-business
▸ Create only essential website content
▹ Website must include and prominently display privacy, shipping, return and refund policies
▹ Placing links to these policies in the footer of website will make them present on every page
▹ Must be reliable and to provide customers with easy and simple navigation
▸ Focus on risk reduction
▹ A well defined sales order process helps address risk concern
▹ Indicate or highlight required transaction fields in online payment acceptance form and verify card and cardholder
information that received from customers over the internet.

46
 Managing risks in E-business
▸ Prevent internal fraud
▹ Profitability of e-commerce organization depends on internal strategies and controls for minimizing fraud
▹ A risk management structure, combined with adequate transaction controls, helps avoid fraud-related losses.
▸ Use proper fraud prevention tools
▹ Address Verification Service (AVS), the Card Security Codes (CVV2, CVC 2 and CID), Verified by Visa and MasterCard
SecureCode.
▸ Secure routing process
▹ Ensure that Authorization requests are submitted in a secure and efficient manner, before you starting to accepting
card payments over the internet.

47
 Managing risks in E-business
▸ Minimise unnecessary chargebacks
▹ Costly reality for online business
▹ Chargebacks result in extra processing time and costs, while hurting profits resulting in a loss of revenue
▹ By carefully tracking and managing chargebacks, businesses can set up concrete procedures for avoiding future
chargebacks.
▹ [Link]

48
 Managing risks in E-business
▸ Ensure PCI compliance
▹ The Payment Card Industry (PCI) Data Security Standards (DSS) provide web-based merchants with standards,
procedures and tools for protecting sensitive account information.
▹ Provides reliable encryption capabilities for data transmission and effective internal controls for protecting stored card
and cardholder information
▹ Review security measures on a regular basis
▸ Prevent merchant account from intrusion
▹ Security measures to prevent hackers from getting access to your shopping cart or payment gateway

49
 Managing risks in E-business
▸ Participate in Verified by Visa and MasterCard SecureCode
▹ The two fraud prevention tools enhance security by requiring cardholders to authenticate themselves by entering a
password during the checkout.
▹ The password is verified by the card issuer and, if correct, the transaction is allowed to be completed
▹ Implementing Verified by Visa and MasterCard SecureCode protects merchants from fraud-related chargebacks.

50
Skill Management
Skill Management
Managing an e-business, which operates primarily online, requires a
unique set of skills due to the fast-paced, dynamic nature of the digital
environment. Here are some essential management skills for e-business:
Digital Literacy: Understanding digital technologies, platforms, and tools is
fundamental for managing an e-business. This includes proficiency in using e-
commerce platforms, content management systems (CMS), digital marketing
tools, analytics platforms, and other relevant software.
Strategic Thinking: Effective e-business managers need to develop and
implement strategic plans that align with the organization's goals and market
trends. They should be able to identify opportunities for growth, anticipate
challenges, and adapt strategies accordingly in the digital landscape
Data Analysis: Data drives decision-making in e-business. Managers should
possess strong analytical skills to interpret data from various sources such as
website analytics, customer behavior, sales metrics, and market trends. This
enables them to make informed decisions and optimize business performance.
Digital Marketing: Proficiency in digital marketing is crucial for promoting
products or services, attracting customers, and increasing online visibility.
Managers should understand SEO (Search Engine Optimization), SEM (Search
Engine Marketing), social media marketing, email marketing, and other digital
marketing strategies to effectively reach target audiences.
Customer Relationship Management (CRM): Building and maintaining
relationships with customers is vital for e-business success. Managers should be
adept at implementing CRM systems to track customer interactions, personalize
marketing efforts, and enhance customer satisfaction and loyalty.
E-commerce Operations: Knowledge of e-commerce operations, including
inventory management, order fulfillment, payment processing, and shipping
logistics, is essential for managing an online store or marketplace effectively .
Cybersecurity Awareness: With the increasing prevalence of cyber threats, e-
business managers must understand cybersecurity risks and best practices to
protect sensitive data, customer information, and the integrity of online
transactions.
Adaptability and Innovation: The digital landscape evolves rapidly, requiring e-
business managers to stay updated on emerging technologies, industry trends,
and consumer preferences. They should be flexible, open to change, and
proactive in adopting innovative strategies to stay competitive.
Problem-Solving and Decision-Making: E-business managers encounter various
challenges, such as technical issues, customer complaints, and market
disruptions. Strong problem-solving and decision-making skills enable them to
address issues promptly, mitigate risks, and seize opportunities for growth.
Roles of E-commerce manager
The role of an e-commerce manager is multifaceted,
encompassing various responsibilities aimed at driving the
success of an online business. Here are some key roles and
responsibilities of an e-commerce manager
[Link] Planning: Develop and implement e-commerce
strategies aligned with the overall goals and objectives of the
organization. This involves identifying market opportunities,
defining target audiences, setting sales targets, and creating
plans to achieve growth.
[Link] Management: Oversee the design, development,
and maintenance of the e-commerce website or platform.
Ensure that the website is user-friendly, visually appealing, and
optimized for performance, including fast loading times and
mobile responsiveness.
Product Management: Manage the product catalog, including
adding new products, updating product information, and
optimizing product listings for search engines. Monitor inventory
levels, pricing, and promotions to maximize sales and
profitability.
Digital Marketing: Develop and execute digital marketing
campaigns to drive traffic, increase conversions, and enhance
brand awareness. This may involve utilizing various channels
such as search engine optimization (SEO), pay-per-click (PPC)
advertising, email marketing, social media marketing, and
affiliate marketing.
Customer Experience Optimization: Focus on improving the
overall customer experience to increase satisfaction and
retention. This includes optimizing the online shopping process,
providing excellent customer service, and implementing
strategies to reduce cart abandonment rates.
Analytics and Reporting: Monitor key performance metrics
such as website traffic, conversion rates, sales revenue, and
customer engagement. Analyze data to identify trends, evaluate
the effectiveness of marketing initiatives, and make data-driven
decisions to improve business performance.
Payment and Security: Ensure that payment processing
systems are secure and compliant with industry standards and
regulations. Implement measures to protect customer data and
prevent fraud, such as encryption and secure payment
gateways.