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Question Paper
E-Business (MB351IT) : July 2006
Section A : Basic Concepts (30 Marks)
- This section consists of questions with serial number 1 - 30.
- Answer all questions.
- Each question carries one mark.
- Maximum time for answering Section A is 30 Minutes.
1 Which of the following is true for customer centric e-business?
I. e-business is about transforming an organizination for information age. II. e-business is about improving employee productivity in organizations. III. e-business is to maximize customer satisfaction and loyalty. IV. e-business offers significant potential to transform companies by creating new value chain and business processes. (a) Only (I ) above
(b) Both (I) and (II) above
(c) (I), (II) and (III) above
(d) Both (II) and (III) above
(e) All (I), (II), (III) and (IV) above.
< Answer >
2. Which of the following is not the reasons for use of e-business in organizations?
(a) Transaction Management
(b) Business efficiency
(c) Reshaping customer relationship
(d) Reaching new markets and segments
(e) Product management.
< Answer >
3. Which of the following is not the key characteristic of e-business?
(a) Customer is the king
(b) Entry barriers are low
(c) e-business leads to disintermediation
(d) Economics of scale
(e) Product centric.
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4. The integration of suppliers and business partners into a single manufacturing entity is known as
(a) e-supply chain
(b) Forward integration
(c) Backward integration
(d) e-business
(e) Extraprise supply network
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5. Which of the following statements is/are true?
I. E-Business technologies enable timely and effective customer segmentation. II. E-Business helps organizations correlate information on different customers. III. Companies are able to segment customers on the basis of complex factors like channel preference.
(a) Only (I) above
(b) Only (III) above
(c) Both (I) and (III) above
(d) Both (I) and (II) above
(e) All (I), (II) and (III) above.
< Answer >
6. When huge amount of information is available in organizations, it is difficult to use it since it is scattered across different files in different formats and different locations. This is called as
(a) Predictive Modeling
(b) Optimization of channel strategy
(c) Silo Effect
(d) E-commerce modeling
(e) Scalable system.
< Answer >
7. In e-business systems, What does Scalability refers to?
(a) Integration of back office systems with front end systems
(b) System should be replicated in several locations
(c) Ability of system to handle numerous users concurrently and allow them to complete transactions in minimum time
(d) Single view of the organization to customers
(e) Centralized storage of customer and product information to develop sound strategies.
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8. Which of the following is/are not an e-business model(s)?
I. B2B. II. B2C. III. C2C. IV. C2B.
(a) Only (IV) above
(b) Both (I) and (II) above
(c) Both (II) and (III) above
(d) Both (II) and (IV) above
(e) All (I), (II), (III) and (IV) above.
< Answer >
9. Which of the following is not a benefit of B2B marketplace?
(a) Effective management of inventory
(b) Quick response to customer demand
(c) Efficient and fast product launch
(d) Control over fraudulent Purchases
(e) Increased cost of paper work.
< Answer >
15. Which of the following is not considered as an important qualities needed for a CRM execution plan in e- business development process?
(a) Speed
(b) Efficiency
(c) Quality
(d) Flexibility
(e) Short time.
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16. What is/are the major phase(s) in the evolution of e-market places?
I. Commodity exchanges. II. Value added services. III. Knowledge networks. IV. Value trust networks.
(a) Only (I) above
(b) Both (I) and (II) above
(c) Both (II) and (III) above
(d) Both (III) and (IV) above
(e) All (I), (II), (III) and (IV) above.
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17. Which of the following activities is/are important in organizations to develop e-business?
I. Information capture. II. Information storage. III. Information dissemination.
(a) Only (I) above
(b) Only (III) above
(c) Both (I) and (II) above
(d) Both (II) and (III) above
(e) All (I), (II) and (III) above.
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18. What is/are the parameter(s) required for managers to build a business case for long term sustainability of an e- business?
I. Customer requirements that need to be fulfilled. II. Size of the target market segment. III. Range of products and services to be offered. IV. Revenue model for each strategy.
(a) Only (I) above
(b) Both (I) and (II) above
(c) Both (III) and (IV) above
(d) Both (II) and (III) above
(e) All (I), (II), (III) and (IV) above.
< Answer >
19. In e-business, the electronic exchange of business transaction documents between the trading partners is termed as
(a) Electronic Funds Transfer
(b) Electronic Data Interchange
(c) Electronic Market Places
(d) Electronic Application Integration
(e) Electronic Logistics.
< Answer >
20. Of which of the following, the primary objectives are to reduce supply costs, improve product margins, increase manufacturing throughput and improve return on investment.
(a) Enterprise Resource Planning
(b) Supply Chain Management
(c) Material Requirement Planning
(d) Decision Support System
(e) Customer Relationship Management.
< Answer >
21. Which of the following is a way to ensure that an electronic document is authentic in e-business transactions?
(a) Digital certificate
(b) Digital signature
(c) Cryptography
(d) Password
(e) Compression.
< Answer >
22. Which of the following is essentially deals with organizational learning and business know-how?
(a) Knowledge Management
(b) Online Analytical Processing
(c) Bussiness Process Reengineering
(d) Artificial intelligence
(e) Total Quality Management.
< Answer >
23. If Knowledge management deals with capturing, storing and disseminating knowledge, then What is Explicit Knowledge?
I. Knowledge which resides with the employees. II. Knowledge about processes and practices in the organization. III. Clusters of knowledge present with in the organization.
(a) Only (I) above
(b) Only (II) above
(c) Both (I) and (II) above
(d) Both (II) and (III) above
(e) All (I), (II) and (III) above.
< Answer >
(a) Only (I) above
(b) Only (II) above
(c) Both (I) and (II) above
(d) Both (II) and (III) above
(e) All (I), (II) and (III) above.
29. Which of the following software is not required to achieve business integration of an organization in e-business?
(a) Middleware
(b) Message Oriented Middleware
(c) Data Integration Middleware
(d) Remote Procedure Middleware
(e) Web Server.
< Answer >
30. Which of the following technology is used to connect different electronic devices over a wireless network?
(a) WAP
(b) Bluetooth
(c) I-Mode
(d) Biometric technology
(e) Sniff mode technology.
< Answer >
END OF SECTION A
Section B : Caselets (50 Marks)
- This section consists of questions with serial number 1 – 5.
- Answer all questions.
- Marks are indicated against each question.
- Detailed explanations should form part of your answer.
- Do not spend more than 110 - 120 minutes on Section B.
Caselet 1
Read the caselet carefully and answer the following questions:
eBay Card Services, formerly American Express Bank International, the overseas operation of Bank One Corporation, entered a highly competitive market when it began to offer its low-cost credit cards to USA consumers in 2001.
1. What are the benefits derived by eBay and its customers with the implementation of e-CRM Architecture? Explain the e-CRM components essential while implementation.
(15 marks)
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2. In addition to providing e-CRM software, what were the other technologies eBay card services adopted for service, sales and support channels?
(5 marks)
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Operating from a call center in Herdon, Virginia, it differentiated its products on price and by its range of affinity schemes, partnering with organizations like Yahoo!, Washington DC, the World Olympics, and Simpson Lloyd Spa to offer attractive, co-branded cards.
By May 2002, the company had attracted thousands of credit card customers, but competition was becoming fiercer. To be able to continue competing on price, eBay Card Services needed to keep its operating margins down while maintaining a high level of customer service that would ensure its cardholders remained loyal. The solution was to embrace the Web as self-service sales and support channel.
In May 2002, eBay Card Services selected Synergy Software Co. to provide the e-CRM software for the self-service web front end. The new system would encompass a credit card application form for new customers and a facility for existing customers to view their account details and make online payments, as well as the underlying integration structure that would present customer information to eBay's Customer Service Representatives (CSRs) via the company's intranet. Additionally, the Synergy Software solution would interface to eBay Card Services USA legacy mainframe systems, which hold all customer account and product details.
A Tightly-Integrated e-CRM Architecture: Synergy Software was selected for its open and scalable architecture, which could easily integrate with eBay Card Services legacy systems, and for its ability to provide both a robust front- end and an integration framework that would ensure that CSRs would always have a single view of each customer. Synergy Software’s object-oriented architecture meant that it could be implemented quickly, an essential feature given that the project was scheduled to go live in just 12 weeks. Finally, eBay Card Services realized that Synergy Software Co. could be easily extended to support new sales and support channels should the company wish to expand in the future into WAP or digital TV.
Implementation and Integration: Work began in June 2001 with a team composed of representatives from Synergy Software Co., eBay Card Services. The eBay Card Services web site is hosted by Seibel Telecom (ST) on a Microsoft server. ST also provides the security for the web pages. Synergy developed Java servlets to run inside the Netscape Enterprise Server on the ST web server, to provide front-end login screens and an online application form, as well as to make cardholders account information viewable on the Web site. The Java servlets communicate with the Synergy server via VIOP. The Synergy server runs on two clustered HP 9000 N-series servers at eBay Card Services' Virginia headquarters. Synergy integrates tightly via IBM MQ Series message-queuing middleware with eBay Card Services IBM mainframe, which houses all customers, account and product data. This integration ensures that all information input by customers on the web site is stored in the mainframe, and also enables existing eBay Card Services card customers to view their balance information and recent transaction details on the eBay Card Services web site.
Online Payments: Running alongside the Synergy web application on the eBay Card Services site is an application provided by World Pay, which allows existing customers to pay their credit card bills over the Internet using a Switch or Delta card. World Pay provides payment reports daily to eBay Card Services. As well as being used by eBay Card Services customers on the web site, the Synergy system is also used by eBay Card Services fifty Cardiff-based CSRs, who have access to the system via the company's intranet. This means that when a customer phones in, they can call up that customer's account details and transaction history, regardless of whether previous interactions were by telephone or on the Internet. As Synergy Software Co. presents all customer information in one single view, customers receive informed and intelligent treatment from CSRs, ensuring a higher level of satisfaction. The system went live on time and on budget in September 2001, after a successful implementation period of just twelve weeks.
Caselet 2
Read the caselet carefully and answer the following questions:
In 2001, Varsha Corporation Limited (VCL), a leading player in the Indian petroleum industry, successfully implemented Enterprise Resource Planning (ERP). Implementation began in September 2003 after the company decided to integrate all its activities through the ERP package SAP R/3. The company hoped to speed up its decision-making and
3. Explain the concept of Enterprise Resource Planning (ERP), its evolution. What according to you is the rationale behind deployment of ERP?
(10 marks)
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4. Explain the steps involved in determining the success of ERP implementation.
(10 marks)
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5. Explain why VCL has decided to implement SAP R/3. What are the benefits derived by VCL with ERP implementation?
(10 marks)
< Answer >
Suggested Answers
E-Business (MB351IT) : July 2006
Section A : Basic Concepts
be integrated at depots with the help of SAP. We plan more retail disbursements through SAP once RBI’s payment disbursement norms are passed.” Before the successful implementation of SAP R/3 at VCL, the ERP market had been proclaimed dead by many analysts because of the number of failures of ERP implementation exercises. Experts hailed implementation as the revival of the ERP market in India.
END OF SECTION B
Section C : Applied Theory (20 Marks)
- This section consists of questions with serial number 6 - 7.
- Answer all questions.
- Marks are indicated against each question.
- Do not spend more than 25 -30 minutes on section C.
END OF SECTION C
END OF QUESTION PAPER
6. Increase in popularity of e-businesses has attracted many businesses to adopt it and evolve various business models. In view of this, Explain what is a Business Model and write short notes on various business models.
(12 marks)
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7. Network economy is creating new industries in electronic commerce, digital communications and ITeS. In view of this write short notes on the following :
a. Information systems and technology. b. Outsourcing. c. Mergers and Acquisitions. d. Wireless Technologies. (2 + 2 + 2 + 2 = 8 marks)
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- Answer : (e) Reason: Customer centric e-business is about transforming an organizination for information age, it is about improving employee productivity in organizations, it is to maximize customer satisfaction and loyalty, it offers significant potential to transform companies by creating new value chain and business processes. So option (e) is the answer.
- Answer : (e) Reason : Product management is not the reason for use of e-business in organizations..
- Answer : (e) Reason : Product centric is not the key characterstic of e-business.
- Answer : (e) Reason : The integration of suppliers and business partners into a single manufacturing entity is known as extraprise supply network. So option (e) is the answer.
- Answer : (e)
Reason : In segmentation of customers, E-Business technologies enable timely and effective customer segmentation, E-business helps organizations correlate information on different ustomers, Companies are able to segment customers on the basis of complex factors like channel preference. So option (e) is the answer.
- Answer : (c)
Reason : When huge amount of information is available in organizations,it is difficult to use it since it is scattered across different files in different formats and different locations. This is called as Silo effect. So option (c) is the answer.
- Answer : (c)
Reason : Ability of system to handle numerous users concurently and allow them to complete transactions in minimum time is called as Scalability. So option (c) is the answer.
- Answer : (a)
Reason : C2B is not the basic e-business model. So (a) is the answer.
- Answer : (e)
Reason : Increased cost of paper work is not a marketplace benefit of B2B. So option (e) is the answer.
- Answer : (e)
Reason : Clearing system is not a component of e-nabling sell site in e-business. So option (e) is the answer.
- Answer : (c)
Reason : Internet Protocol (IP) telephony technology is used in call centers to enable customers to talk to company employees/agents from its web site. So option (c) is the answer.
- Answer : (b)
Reason : The various types of partners in value network management are Strategic Service partners, Application Service Providers, Network operation partners, Value added suppliers..
- Answer : (e)
Reason : Collaborative filtering is not considered in convergence process in e-business. So option (e) is the answer.
- Answer : (d)
Reason : Chief Knowledge officers are not the key executives responsible for deployment of e-business case.
- Answer : (e)
Reason : Short time is not considered as an important qualities needed for a CRM execution plan as it is an implication of CRM execution plan. So option (e) is the answer.
- Answer : (e)
Reason: The major phases in the evolution of e-marketplaces are Commodity exchanges, Value added services, Knowledge networks, Value trust networks. So option (e) is the answer.
- Answer : (e)
Reason: Information capture, storage and dissemination are important activities in organizations to develop e- bisiness. So option option (e) is the answer.
- Answer : (e)
Reason: The parameters required for managers to buid a business case for long term sustainibility of an e- business are Customer requirements that need to be fulfiled,Size of the target market segment,Range of products and services to be offered,Revenue model for each strategy. So option (e) is the answer.
- Answer : (b)
Reason: The electronic exchange of business transaction documents between the trading partners over computer networks is termed as Electronic Data Interchange(EDI). So option (b) is the answer.
- Direct Marketing and fulfillment
- Customer support and service
- Field service operations
- Retention Management. (Students are advised to elaborate on above points) 2. In adition to provide e-CRM software the following were the technologies adopted by eBAY card services.
Online Payments: Running alongside the Synergy web application on the eBay Card Services site is an application provided by World Pay, which allows existing customers to pay their credit card bills over the Internet using a Switch or Delta card. World Pay provides payment reports daily to eBay Card Services. As well as being used by eBay Card Services customers on the web site, the Synergy system is also used by eBay Card Services' fifty Cardiff-based CSRs, who have access to the system via the company's intranet. This means that when a customer phones in, they can call up that customer's account details and transaction history, regardless of whether previous interactions were by telephone or on the Internet. As Synergy Software Co. presents all customer information in one single view, customers receive informed and intelligent treatment from CSRs, ensuring a higher level of satisfaction.
3. ERP is software driven business management system that helps to integrate all functions of a business including planning, manufacturing, sales, and marketing. The history of ERP has its roots in the inventory control systems developed in the 1960s to manage inventory according to traditional inventory concepts. Over the next few decades, as businesses became increasingly complex and global, companies came under pressure to improve their competitiveness by lowering operating costs and improving logistics. ERP aimed at helping the management for setting better business practices and equipping them with correct information for taking timely decisions. In the 1970s, the concept of Material Requirement Planning (MRP) emerged, which focused mainly on raw material requirement planning. In the 1980s, the concept of MRP-II (Manufacturing Resource Planning) evolved. MRP-II involved optimizing the production process of the entire plant. Though MRP-II evolved as an extension of MRP for shop floor and distribution management activities, it was gradually extended to areas like Finance, HR, Engineering and Project Management etc. This eventually gave way to ERP that covered cross-functional coordination and integration to support the production process. ERP initially targeted the manufacturing industry and dealt with functions such as planning and managing businesses like sales management, production management, accounting and finance. Later, these packages diversified into many different types of industries. The main modules in a typical ERP application were finance and accounting, customer order management, MRP, materials management and decision support/data warehousing. In the pre-ERP era, companies were largely confined to local markets and all managerial functions were managed by a single set of people. However, as businesses became global companies’ activities grew beyond local boundaries and more people were brought in to manage the businesses. While the departments within the companies grew, they also set up their own procedures and hierarchy. Within departments, information moved upward. Due to the upward movement of information, it was shared between departments at the top level only. ERP thus aided in effectively managing the resources of the organization. ERP packages were originally targeted at large corporations operating in multiple lines of business in several countries. Such companies employ a wide range of business management applications that often run on heterogeneous technology platforms. These applications may have been either developed in-house or purchased from multiple suppliers in the form of package applications. Package applications are ready-to- implement solutions. They are purchased by companies because they offer broad functionality and serve a specific business need. However, the applications purchased from different vendors are not easily integrated with other enterprise systems and pose problems in day-to-day operations. The applications serve as information islands and make it hard to move data from one system to another. Business managers find it difficult to get a composite view of the business, as they cannot obtain information from different systems at one place. Sometimes, the data of one system is re-entered in another system. The process is prone to errors. As a result, the quality of information deteriorates and business management becomes less effective. ERP solves these problems by facilitating integration between various functions. ERP software eliminates the need to obtain a different application for each of the business needs. It offers applications that consist of different functional modules that are well integrated and run on a single technology platform (e.g. a client/server architecture utilizing a Unix-based server platform combined with MS Windows on the desktop). The integration facilitates real-time updation across all the enterprise systems. In India, the need for ERP implementation was felt soon after the liberalization of the economy in the early 1990s. Indian companies realized the importance of customer focus, improving speed of delivery and cost
1990s. Indian companies realized the importance of customer focus, improving speed of delivery and cost competitiveness to compete with MNCs. It became increasingly important to provide improved quality at lower prices. The decision to implement ERP systems for improving business processes and gain the competitive edge in the new global environment thus had become essential.
4. The following are the steps involved in determining the success of ERP implementation are:
Understanding Corporate Needs and Culture The primary requirement of ERP implementation is the organization’s readiness and its capability to implement change. It requires the active participation of the top management as well as employees of different departments. In many cases, organizations perceive the need for change but there is a lack of willingness to change. Sometimes the management does not anticipate the impact of change. ERP implementation results in changes in roles, authority and responsibility, and skill sets of employees, and some employees resist these changes. The management should educate the employees about the opportunities that can be leveraged by changing, and the costs of not changing. Then, employees’ resistance to change can be significantly reduced. The project leaders should be aware of the difficulties they will face in the process of change and be prepared to tackle them. They should be able to convince employees that change is not being enforced on them by the management, but that the business environment has made the change necessary. Complete Business Process Changes Before initiating the process of ERP implementation, the management should identify the changes to be brought about in business processes, and skills and attitudes of the workforce. The implications of change are often underestimated. It would be worthwhile for companies to engage in a brief business process redesign prior to ERP implementation. The management and the implementation teams should analyze the ERP package structure to ascertain that the organization’s requirements are satisfied by the solution. This will enable organizations to avoid failure. After the software is integrated, making modifications to the core capabilities of the system is difficult as well as expensive. It is always advisable to make informed decisions at the earlier stages rather than incurring costs on reconfiguration of the entire system after implementation. Communicate Across the Organization The support of the top management executives and their feedback on critical issues are essential in ERP implementation. Communicating the need for change should be a constant activity in the organization. A rigorous training program should be organized to communicate the importance of change to employees at different levels in an organization. An exercise that is very useful in this regard is realistic modeling of expectations. If the expectations are too high it could lead to undue stress and frustration, while unduly low expectations make employees complacent. Hence organizations should have realistic expectations from their employees too. Strong Project Leadership Project managers are instrumental in making ERP implementation successful. It is important for the project managers to understand, appreciate and apply factors that contribute to success. The managers should not limit their role to providing moral support for employees but should actually involve themselves in real time project implementation. If necessary, managers should undergo the required training course to understand the system and its applications. They should learn to use business process modeling tools and understand the limitations and the potential for improvement in the system. They should be able to use business process maps and obtain a broader view of processes. The managers should be able to find out even the minute details about the organization’s operations. If managers do not have a minimum knowledge of technical details of the system, they will lack command over the implementation team. To ensure success, project managers should develop a committed and competent team capable of handling change and redesigning processes. Efficient and Capable Project Leader The best way to implement ERP is by integrating organizational and IT skills for change management. Efficient project managers discuss the issues with the employees who are affected by the change. When employees are also involved in discussions, they become receptive to change. Earlier, IT change, business process change, organizational and individual change were viewed as separate areas with change as the common factor. However, it is observed that the change in one factor brings about changes in other factors. Hence, the term – 'integrated change' is now used to refer to a combination of all the three changes. Enterprise-wide integrated information systems make ERP projects more complex. The projects have to deal with changes in technology, business processes, organizational structure, standards and procedures – all of which affect the roles of individual employees. The project leader should be able to handle the impact of all these elements on the organization and its employees.
5. The ERP implementation was part of the company’s ‘Project CUSEC (Customer Service and Satisfaction),
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it will not be able to concentrate on core processes where its competitive advantage lies. Companies have to satisfy the demands of the customers as well as investors, customers demand the companies to be innovative and offer value to their money while investors expect returns. Thus they are compelled to keep their costs low by outsourcing and spend scarce resources on innovation, technology and brand development. To survive in this competitive world, more and more organizations are moving towards Business Process Outsourcing. However organizations should not outsource operations that are critical to execution of strategies formulated by top management. The organizations should setup proper control systems to monitor the work being done by the contractor to ensure that work is done with in the budget and quality.
c. Mergers and Acquisitions: Mergers and acquisitions have brought out dramatic changes through out the world in the recent past. The deregulation in telecommunication industry ended the monopoly of many large organizations. Companies have found that selling supply chain applications are helpful in communicating changes to customers in a cost-effective way.
d. Wireless Technologies: Wireless application protocol (WAP) is an application communication protocol. it is the standard for wireless technology for accessing the internet over client devices like mobile phones. it is based on internet standards like html,xml,tcp/ip. It was established by a forum in 1997 by Erickson, Motorola nokia. It uses wml technologies for presentation and wireless telephony application interface specification for interconnectivity. Bluetooth technology is used to connect different electronic devices like mobile computers and mobile phones over a wireless netwrk.it use radio links under 2.4 GHz frequency band. The technology has high data transfer rate up to 1 mbps. I-Mode technology offers web browsing and email access through mobile phones. it was introduced in Japan by DoCoMo’sinternetgateway.
