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Question Paper
E-Business (MB351IT) : July 2008
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. Union Bank uses separate systems for the collection of data across the world. The bank is finding difficulty in consolidating the data. Which of the following will help the bank in consolidating the data across disparate systems?
I. Data warehousing. II. Data mining. III. Data dictionary.
(a) Only (I) above
(b) Only (II) above
(c) Only (III) above
(d) Both (I) and (II) above
(e) All (I), (II) and (III) above.
2. PricewaterhouseCoopers has identified various distinct phases of e-business. Which of the following phase involves putting supply chain management processes online by linking suppliers with the enterprise, using extranets and intranets? (a) First phase
(b) Second phase
(c) Third phase
(d) Fourth phase
(e) Fifth phase.
3. In e-buying and as well as e-selling certain steps are carried out in the sequence. Which of the following is the correct sequence? (a) Provide e-catalog, determine price, accept order, configure solution, check inventory, process order, order tracking, payment
(b) Configure solution, provide e-catalog, determine price, accept order, check inventory, process order, order tracking, payment
(c) Provide e-catalog, determine price, check inventory, accept order, configure solution, process order, order tracking, payment
(d) Provide e-catalog, configure solution, determine price, accept order, check inventory, process order, order tracking, payment
(e) Configure solution, provide e-catalog, determine price, check inventory, accept order, process order, order tracking, payment.
4. Computers cannot communicate with each other directly over telephone lines because they use digital pulses whereas telephone lines use analog sound frequencies. What is the name of the device which permits digital to analog conversion at the start of a long distance transmission? (a) Modem
(b) Repeater
(c) Bridge
(d) Router
(e) Switch.
5. Which of the following is defined as a process in which companies change the established boundaries between industries in their attempt to achieve new competitive advantages?
(a) Channel enhancement
(b) Reverse engineering
(c) Convergence
(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.
9. Which of the following type(s) of e-business projects are undertaken by companies that are trying to explore new markets or new business opportunities?
I. Incremental. II. Breakthroughs. III. Platform.
(a) Only (I) above
(b) Only (II) above
(c) Only (III) above
(d) Both (I) and (II) above
(e) All (I), (II) and (III) above.
The justification for the project should be substantiated from some dimensions. Which of the following dimensions should elaborate on how enterprise applications will influence the competitive position of the company?
(a) Strategic justification
(b) Operational justification
(c) Technical justification
(d) Financial justification
(e) Cultural justification.
“A firm should have a variety of products offering and it should take care that a large number of products do not affect the quality”. Which of the following key principles of operational excellence relates to the above sentence?
(a) Optimization of resource utilization
(b) Integration of supply chain operations
(c) Management of market information
(d) Management of control systems
(e) Customer expectation.
The discount brokerage firm Charles Schwab categorizes its customers in many ways. According to this firm, the customers who need a stable financial service provider and are interested in technical analysis are known as
(a) Life goal planners
(b) Serious investors
(c) Hyperactive traders
(d) One stop shoppers
(e) Two stop shoppers.
Which of the following are the principles guiding continuous innovation?
I. Risk-oriented management style. II. Mergers and acquisitions. III. Market education style. IV. Encourage innovation.
(a) Both (I) and (II) above
(b)
(b) Value Added Suppliers (VAS)
(c) Commodity Suppliers (CSs)
(d) Non-strategic Service Partners (NSPs)
(e) Network Operations Partner (NOP).
The various levels in a public key infrastructure are as follows:
I. Encryption entities. II. Root central facility/Policy approval. III. Local registration authorities. IV. Digital signature entities. V. Certification authorities/Cybernotaries. VI. User certificates/Digital signatures.
Which of the following represents the correct sequence of hierarchy?
(a) I, VI, III, II, IV and V
(b) II, V, III, I, IV and VI
(c) III, I, VI, II, V and IV
(d) IV, II, VI, III, V and I
(e) V, III, VI, IV, I and II.
Which of the following standards on the internet refers to a common set of business requirements or a framework for business-to-business internet commerce solutions and is suitable for high volume low cost transactions?
(a) Secure electronic transaction
(b) One-time password authentication
(c) Open buying on internet
(d)
Joint electronic payment initiative
(e) Open financial exchange.
Which of the following RFC is titled as “The recommendation for the IP next generation protocol (IPv6)”?
(a) RFC 1636
(b) RFC 1752
(c) RFC 2048
(d) RFC 2311
(e) RFC 2574.
Which of the following type of comparative buying takes place when buyer chooses between vendors of the same product?
(a) Competitive buying
(b) Non-competitive buying
(c) Complex buying
(d) Non-complex buying
(e) Collaborative buying.
Which of the following software programs change the functions of keys in a key board with disastrous consequences?
(a) Logic bombs
(b) ANSI bombs
(c) Trojans
Only (II) above
(c) Both (I) and (II) above
(d) Both (I) and (III) above
(e) All (I), (II) and (III) above.
Which of the following objectives of cryptography provides the proof that the document came from the sender even when the recipient tries to deny that?
(a) Authentication
(b) Confidentiality
(c) Integrity
(d) Non-repudiation
(e) Time stamping.
Which of the following major PKI product is a customizable, scalable product that supports high level application programming interfaces and provides robust security to many commercial applications?
(a) Entrust
(b) Baltimore
(c) Verisign
(d) Xcert
(e) TrustPoint.
Which of the following types of digital certificate are used to authenticate e-mail, name and identity and are globally interoperable?
(a)
Type 0
(b) Type 1
(c) Type 2
(d) Type 3
(e) Both type 2 and type 3.
Which of the following is false about hash function?
(a) The value of hash function is not unique for hashed data
(b) The hash function takes an input message of arbitrary length and output a fixed length code.
(c) A distilled version of the message to be signed is created by the hash function and hash output is encrypted to generate digital signature
(d) MD4 is a hash algorithm
(e) The algorithm that is considered cryptographically suitable for a hash function should possess consistency, randomness, uniqueness and be unidirectional.
The client and server will perform various functions in a client/server architecture. “The client applications are serviced by a pool of servers”.
Which of the following functions relates to the above statement?
(a) Screen scraping
(b) Data validation
(c) Split application logic
(d) Server specific
(e) Back-end database.
Process Outsourcing. “It means I don’t have to deal with the server and security issues”.
Other companies, too, are looking to SR Info Solutions to extend their EDI systems via the Internet, rather than forcing smaller trading partners to build traditional, expensive EDI systems that require users to send the standards- based forms over a private network. SR Info Solutions is able to attract companies looking for outsourcing because they have lower entry costs and offer better service than their competitors. If a company performs all functions, it will not be able to concentrate on core processes where its competitive advantage lies.
The system is also appealing to some companies that don’t use EDI. The system is also a time-saver. Previously, a staffer needed at least 15 minutes to process a bill. Now he or she can process 65 vouchers in less than two hours.
END OF
CASELET 1
Caselet 2
Read the caselet carefully and answer the following questions:
4. In how many types the products and services offered by the bank on internet are divided? Discuss.
( 6 marks )
5. If you are the manger for Brahmaputra Commerce Bank (BCB), how do you foresee the future of the e-banking?
marks )
6. What are the e-banking strategies that Brahmaputra Commerce Bank (BCB) might have developed in order to attract and retain the customers?
marks )
Brahmaputra Commerce Bank (BCB), a leading development and financial institution of India, promoted BCB Bank to mark the formal foray of BCB into commercial Banking. This initiative has blossomed into a success story with BCB Bank achieving a front ranking position in the Indian Banking Industry. BCB Bank has been rated as the fastest growing company in the country by Business World, India. The bank which began with an equity capital base of Rs.1000 million (20 M USD) in November 2000, today has 160 branches and over 350 ATMs spread across 95 cities.
In January 2004, following a change in the top management of the bank, the strategy of the bank was redrawn. The bank felt a strong need to upgrade the technology platform, which would enable the bank to transform itself to meet the challenges of the future.
BCB Bank had started operations as a bank catering primarily to corporate clientele. This strategy was redrawn in early 2004 to focus on the exciting arena of Retail Banking. Seen in this light, 53 branches and 79 ATMs (Automated Teller Machines) nationwide just didn't seem enough. The need of the hour was to have a technology platform that would seamlessly scale up and at the same time enable BCB Bank to reach out to its customers through multiple delivery channels. On-line banking is important that helps the customers in managing savings and checking accounts, apply for loans, or pay bills quickly and easily. Scalability was important because of the expected explosion in transaction volumes, customer accounts, etc. that accompany consumer banking business and seamless offering of delivery channels was important because customers need and demand not just access but also unified view of their interactions with the bank through multiple delivery channels. In short the need was to have a completely integrated solution, which would cater to consumer banking requirements while providing comprehensive business banking functionalities to cater to the bank's corporate customers. However, to meet its new strategic initiatives and specific thrust on retail banking, this core banking system needed to be replaced.
BCB Bank wanted to have a solution that would not only be quick and easy to deploy but also provide the bank the flexibility to launch new products and services easily. The bank was keen to choose a solution that gave it a time-to- market advantage. They needed to choose a technology partner who had a track record of deploying core banking solutions significantly faster. Furthermore, along with the speed of implementation, an extremely robust
solution was required. Achieving technology driven business agility was one of the key drivers for the bank.
After a detailed and rigorous evaluation on BCB Bank, IVR Soft set up the retail and corporate banking, trade finance, as well as consumer and business e- banking operations in a record time frame of 5½ months across the entire bank. BCB Bank have come with the information consisting of all the deliverables customer expects on day one like cheque book, Internet and Phone banking access details etc. This has enabled BCB Bank to open accounts on the fly unlike other banks where the customer needs to wait for a week or more to get these.
END OF CASELET 2
END OF SECTION B
Section C : Applied Theory ( Marks)
This section consists of questions with serial number 7 - 8. Answer all questions. Marks are indicated against each question. Do not spend more than 25 - 30 minutes on Section C.
7. Discuss some of the errors that limit the success of database marketing in the organization.
marks )
8. Explain the layered architecture approach in detail. ( 1 0
marks )
END OF SECTION C
END OF QUESTION PAPER
Suggested Answers
E-Business (MB351IT) : July 2008
Section A : Basic Concepts
Answe r
Reason
1. A Data mining is a technique designed to detect patterns in the data (financial data). Data warehousing is used to consolidate the data across disparate systems. Data dictionary stores information about information that is essential to management as a business resource.
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2. B Second phase involves putting supply chain management processes online by linking suppliers with the enterprise, using extranets and intranets.
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3. D In e-buying some steps are carried out in the sequence. The sequence is as: provide e-catalog, configure solution, determine price, accept order, check inventory, process order, order tracking, payment.
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4. A Modem permits digital to analog conversion at the start of a long distance transmission.
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5. c Convergence is defined as a process in which companies change the established boundaries between industries in their attempt to achieve new competitive advantages.
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6. A The key drivers of convergence are: technology, deregulation of markets, increasing expectations of customers, competitive imperatives. Regulation of markets is not the key driver of convergence.
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7. b Indirect procurement involves purchasing of items not related to production and these items may be related to repair and maintenance activities.
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Section B : Caselets
1. EDI has the following benefits: EDI is a quick, inexpensive and relatively safe method to transmit invoices, purchase orders, custom documents, shipping notices and other business documents between different firms. When these documents are transferred from computer to computer, the delay and cost incurred for re-keying the information is saved. Errors will be reduced to nearly zero percent. Reduced paper based system Since EDI transactions are from system to system, a company is saved from maintaining a large number of records, paper related systems, stationary and personnel required to maintain them. Improved problem resolution and customer service Inter-business problems caused due to erroneous data entry can be eliminated using EDI. EDI helps in quick transfer of documents, invoices quick filling of orders, shipping notices, etc. which ultimately improves customer service. Enhanced partnership If a supplier accepts the manufacturers request and becomes EDI enable he can move up in the relationship chain from the supplier to the partner. When evaluating the capabilities of suppliers, manufacturers prefer the suppliers who are EDI enabled. Even the ability to implement EDI can also be plus point in evaluation.
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2. The most important factors taken into consideration while selecting an EDI software are:
Number of installations: A firm, which goes for buying the software, should inspect the popularity of the software with regards to the sectoral break down of installations. This is because some software may be good for some sectors like transportation, freight forwarding etc, but may not be so good for others. Financial stability of software house: The software vendor should be able to support the software and execute maintenance contracts. This is of great importance because the software would have to be upgraded periodically to meet changing business needs. Ease of use of software: The software selected should be user-friendly so that valuable man hours are not lost in providing specialized and long training to the personnel. For example, the package could be Windows based or menu driven for ease of use. Hardware compatibility: The software should be compatible with different platforms. If a user wants to change its operating platform, the EDI software should be scalable to the new platform. Ease of upgrade: The EDI software should be able to accommodate future changes that will arise as the EDI trading relationships of the company mature. Network connectivity: The software should be checked whether it is providing connectivity to all other major EDI networks. Multi-standards capability: When a firm sends messages to different partners with different standards, the EDI software should be able to accommodate them also.
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3. Outsourcing non-core processes is essential to create a virtual enterprise. A true e-business is company is not asset intensive but knowledge intensive. If a company performs all functions, 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.
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4. The products and services offered by the banks on the Internet can be divided into three types:
Information Kiosks: These provide information regarding various products and services offered by the bank, to its customers and others in general. The bank's site receives and answers customers' queries through e-mail. Basic Internet Banking: This type of service enables customers to open new accounts, check account balances and pay utility bills. E-Commerce Banking: Here, banks function as electronic marketplaces (e- marketplaces) enabling customers to use their accounts for money transfers, bills payment, purchase and sale of securities, and online real time purchases and payments.
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5. E-Banking is about electronic banking transactions, is meant to at least partially replace, is a expanding sales channel for banks, is a dynamic high tech channel, highly competitive, international and customer oriented, the basis for STP processing, bank access 24 x 7 on a worldwide scale. If I am the manger for Brahmaputra Commerce Bank (BCB), in order to expand the services of the bank in the market, I would go with the following: As in the case of e-banking, security is the prime issue in the wireless environment as well. If mobile handsets are to be positioned as transactional devices, their success will depend on the security standards they follow. Both the sender and the receiver should be certain about secure information transfer. Another trend in e-banking is a shift of focus of BCB from being product-centric to customer- centric. Access to the Internet has transferred wealth management decisions and demand-side technology to customers' hands, and they can dictate the types of products and services they require. While the Internet has enabled BCB to deliver the desired products/services more quickly and cheaply, the challenge for BCB is to improve customer relations using e-channels. Another opportunity is emerging in the form of mobile banking or m-banking. M-banking is both an additional opportunity for BCB to offer their services online and an additional channel from which to access new customers and cross-sell to existing customers. It gives BCB the opportunity to significantly expand their customer base provided they position themselves effectively. BCB can go beyond their traditional role as a channel for banking/financial services and can become providers of personalized information, BCB can successfully leverage m-banking to: Provide personalized products and services to specific customers and thus increase customer loyalty in terms of acquisition, retention and cross-selling. Exploit additional sources of revenue from subscriptions, transactions and third-party referrals. Mobility is a factor that increases convenience in transacting business. Several financial transactions, particularly those that are time-critical, can be carried out using mobile handsets. Customers are readily conducting banking transactions through mobile devices. The focus is now on advanced e-banking features. These features include new authentication solutions for end users, fraud detection and mobile functionalities. And at the same time we continue on automation of business processes, for example payments as well as the account opening process in a multi-channel environment. Customer is using his handheld personal computing device to do his banking business operations on buying products. He arranges to move money from his account to the manufacturer from whom he is buying the product. Meeting the challenges will require mastery of core technology and effective use of the Internet. Today’s banking platforms need to cope with continuously changing business environments, and a continuous flood of new requirements, while staying sufficiently agile. Access: Available “around the clock”, failsafe Trust: Authentity, Integrity, Identity, Confidentiality Adaptability: multi protocol capability, multi language capability, Staged attacks, affecting the bank and/or customers Examples Phishing – 0 0 1 F deceive customers to provide personal IDs (PIN), passwords and transaction numbers (TAN) Trojans – capturing security-relevant information via malicious code (in the end user’s PC or on the bank server) Trojans – creating fake transactions Further considerations I would take are: Just using firewalls and virus scanning software is not enough. The BCB system needs to be flexible, to allow easy integration of new security technology All business transactions need to be centrally logged Business Intelligence functionality to improve security, eg., data mining, blacklist generation etc. to combat fraud. I would consider the following operational characteristics: Central security administration Central tracking facility for business transactions
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The assumption that once the database has been set up, database marketing starts delivering results: Setting up a database is just the starting point for database marketing. The real test of marketing skill lies in the successful application and use of databases. The database should be used effectively for providing better customer service. Complex and Costly Data Warehouses: One-to-one marketing helps in strengthening the organizations relationships with its customers. This requires the maintenance of a database by the company to store and use information about customers. Generally, a data warehouse - a central repository of data from different databases within the company - is used for this purpose. The data warehouse has to be updated regularly, and this is a costly and complex task. Excessive Targets: Through its database marketing initiatives, an organization may witness an increase in sales in the short term. However, in the longer term, sales do not increase at the same rate. Hence, organizations should not set over 0 0 1 F ambitious targets that cannot be accomplished, based on the rise in sales in the short term. Acceptance of database marketing initiative within the organization: This is the most critical factor for the success of any database marketing initiative in an organization. Employees must be convinced of the benefits of database marketing for goals to be successfully met. Absurd loyalty bonuses: The goal of database marketing is to improve the frequency of purchases, strengthen customer relationships and increase customer share. Hence, offers and bonus schemes to the customers that boost up the sales temporarily are not relevant in the context of database marketing. Indirect means of data collection: Very often companies collect data about customers through indirect sources such as credit card companies and data services agencies. These actions may offend customers and hamper relations between customers and the company.
8. Layered Architecture
The layered architecture approach includes the client server architecture and n-tier architecture. These are discussed below. Client/Server Architecture A software component plays a role of either a client or a server. Client requests are serviced by the server. A many-to-many relationship exists between the client and the server. That is, a server may service requests from multiple clients and a client may forward a request to multiple servers. Clients and servers are dependent on protocols for communication. The protocols used for communication between clients and servers may be standardized or customized. The Client/server architecture is commonly known as two tier application. Though the term client/server refers to a pair of systems, it may also refer to a pair of role designations. Hence, this term has been changed to two tier application to refer to both dual systems and dual roles. Client/server architecture uses a communication centric approach. Because of this approach: The client and the server do not have to share a common platform. The client and the server may be remotely distributed. The client and server may perform various functions. Some of the functions are described below: Screen scraping: The client provides a Graphical User Interface (GUI) that is connected to an application server. This can be used for standardizing screens and hiding functionality in mainframes. Data validation: This is an extension of screen scraping. It allows the client to validate the data entered by the users. Split application logic: The application functionality is split between the client and the server. Systems that use database triggers and stored procedures use this functionality. Server specific: The client applications are serviced by a pool of servers. Back-end database: The client and server are used merely as data storage and retrieval devices. The screen scraping functionality is one of the constraints of client/server architecture. It does not help in improving the functionality or flow of applications. From the point of view of design, screen scraping lacks flexibility and manageability. This is so because the system is tightly linked to previous solutions. Thus, screen scraping may bring about superficial changes to the system without any value addition. Screen scraping imposes technical constraints on network traffic, which may adversely affect the performance of the system.
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This is especially true when a large amount of data transfer across networks takes place within a limited bandwidth. This limitation can be overcome by locating the application logic on high capacity servers with links to the database engine. The random separation of back- end and front-end functions adversely affects business. In this type of architecture, data stored at the lower layers is accessed by applications at the upper layers. The components of two tier architecture are tightly integrated, thus causing a reduction in the adaptability and flexibility of the system.
Niter Architecture
The widespread use of hierarchical databases, relational databases, and object oriented programming places a burden on two tier architecture. To overcome this problem, one more level was added to the architecture. This architecture is popularly known as three tier architecture or nTier architecture.
In two tier architecture, the logical data models are done away with after the tables and the code have been designed. But in the case of three tier architecture, the logical data model is built-into the software. The intermediate layer translates the user input into a machine readable format so as to separate the data from the application. By so doing, the intermediate level is able to construct queries that are encapsulated from the client application.
In due course, the three tier architecture got transformed into five tier architecture. This five tier architecture consisted of a user interface, application, business, data access and database. This architecture is important when there is need for a middle layer between the user and the shared data. Organizations that understand the implications of using sharable business objects opt for this architecture. The best example of layered architecture is the architecture used for the networking of computers. In this model, the lower layers contain the definition of bits and their transmission across links. The higher layers deal with the packaging of bits and the structuring of information. The prerequisites of layered architecture are defined responsibilities, stable interfaces, and encapsulation within levels. The OSI is a popular layered architecture. The layered approach leverages the benefits of abstraction. Abstraction refers to the concealment of internal details from the end user. The layering approach
Helps the system model complex solutions. Helps the system carry out several activities simultaneously.
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