Change Management in Organizations- Essay Solved
Getting Ready for the Electronic Marketplaces
A 21-page research that examines the nature of Electronic Marketplaces. This paper looks at what e-business means, what is B2B and B2C and its difference. It also looks at the challenges and changes brought about by the transformation of business into technology-based ventures.
A case-study of Covisnit website was conducted. And since technology is our main concern, further research was done using e-books and those conventional books as well. Previous research materials were also referenced.
Table of Contents
– Welcome to the World of Electronic Marketplace 4
– e-commerce or e-business? 4
– B2B and B2C 5
Why Electronic Marketplace is important 6
– How to assess with B2B 7
Change Management 10
– Challenges of e-business change 10
New Business Models 12
A Mini-case study 14
Volume and Context of the Assignment 17
– Rules for success 17
Welcome to the World of Electronic Marketplace
Understanding technology often is more a matter of attitude than of complex abstractions. Ongoing technical education helps keep workers aware of what technology can offer them, as well as how to use it.
The aim of this paper is to demonstrate how marketing efficiency and effectiveness can be improved through the use of the electronic marketplaces particularly the subject of B2B.
e-Commerce or e-Business?
There are many definitions of e-Commerce. The narrowest refer to it simply as the buying and selling of goods online. treats e-Commerce as a subset of e-Business because the former does not include intra-business functions such as the processing of a purchase order. He quotes the following definition of e-Business: When a business has fully integrated information and communication technologies (ICTs) into its operations, potentially redesigning its business processes around ICT or completely reinventing its business model … e-Business, is understood to be the integration of all these activities with the internal processes of a business through ICT (2002).
defines e-Commerce much more broadly: the sharing of business information, maintaining business relationships, and conducting business transactions by means of telecommunications networks ( 1998). In its broadest form, therefore, e-Commerce can be regarded as synonymous with IBM’s expression ‘e-Business’, which is a holistic concept covering the full range of business functions and structures effected by the Internet, and this is the approach taken in this book. Given the marketing perspective of the book, the more general terms ‘Internet strategy’ and ‘Internet marketing’ are also used extensively here. Agonizing over definitions is probably a waste of effort, because all these terms are likely to be transitory as the Internet becomes an integral part of business activity. In fact, such terms can be likened to early descriptions of the motor car as a ‘horseless carriage’.
B2B and B2C
As illustrated in Figure 1.1 below, business to consumer (B2C) refers to the selling of goods and/or services directly to consumers by businesses. The classic example is Amazon (). Business to business (B2B) refers to the selling of goods and/or services by one company to another as part of their supply chain, and is likely to contribute to at least 80 per cent of the growth of e-Commerce in the next five years. An example is Marshalls ().There are also some more recent arrangements:
– Consumer to consumer (C2C) refers to the selling of goods and/or services between individuals; see, for example, the auction house eBay ().
– Consumer to business (C2B) refers to consumers generating trade with businesses. For example, www.letsbuyit.com allows consumers to come together and aggregate their purchasing power to command discounts normally reserved for large organizations. It can also cover individuals such as lawyers or accountants offering their services to businesses.
Figure 1: The relationship between business to business (B2B) and business to consumer (B2C)
Why Electronic Marketplace is important
Since no one really knows when B2B exchanges will get their act together, now is a good time to take stock of internal systems capabilities, the quality and quantity of technical support staff and the technological literacy of the workforce. Without that, companies will not be ready to benefit from B2B. Taking shortcuts with technology can be dangerous if a device or system is used in a way the designer didn’t intend. It is highly recommendable to establish and maintain a positive company attitude toward the use of technology and give employees regular opportunities to share their views on what works, what doesn’t and why. You see, some companies that did not get what they want from B2B exchanges are at least partly to blame for not committing themselves to make the internal technological and cultural changes necessary to collaborate with external parties online.
How to assess B2B
The word is out – many believe that there are good times ahead for B2B exchange — the electronic marketplaces that seek to bring manufacturers, service providers and their customers together in maximum-efficiency virtual trading environments. Some observers are in contrast however, saying that the short-term prospect for cost savings and expanded markets from B2B exchanges is grim, overshadowed by a suddenly gloomy economy. But regardless of how long it takes for exchanges to begin delivering real value to customers, technologically savvy companies stand to profit.
While the surviving B2B exchanges regroup, organizations that develop the skills and infrastructure necessary to do business online will earn immediate dividends in the form of increased productivity, better interdepartmental coordination and more flexibility in dealing with external entities, including business partners. And that can only translate into a competitive advantage.
Any company having systems that don’t communicate with each other, limited technology staff or a technologically illiterate workforce should take the time to perform a thorough needs assessment and address any such shortcomings swiftly and decisively. They should at least be guided towards a greater and more effective use of technology. Also, there should be an emphasis on the importance of careful and thorough planning. But first, the company managements should determine whether new technology really is, necessary and how it will interact with any existing systems. The following checklist explains how to accomplish that and points out other ways companies improve its use of technology.
– The company management must run through a needs assessment of its technology infrastructure (hardware, software and technology services, such as communications lines) and its workforce’s technological skills. Using reliable data about company operations, managements can help prioritize contemplated improvements as “needed now,” “ultimately necessary” and “desirable.” The company then can use available funding to address these objectives in order, scheduling repeat assessments at regular intervals.
– Wherever possible, the management should encourage the company to use the five major categories of applications software (word processing, spreadsheets, databases, communications and graphics) to automate business processes. It should help establish certain brands of applications and operating system software as company standards and ensure all employees use the same versions. The management should also not upgrade to newer versions unless the additional features they offer are necessary.
– To grow, companies need internal and external communications capabilities, and they should be able to install local area networks (LANs) even if they have only a few PCs. Today’s “lite” versions of LAN operating systems and hardware make the cost and administration manageable. And a LAN enables multiple users to share expensive high-speed communications lines for Web access, spreading their benefits and lowering their per-unit cost.
– A company’s relationship to other professionals, such as technology consultants, can be particularly valuable to a target customer. Those connections can make it easier to engage one or more competent advisers to evaluate the company’s technology plan. The extra expense and effort will pay off in the form of a better, more swiftly implemented plan.
– Once management selects a technology to support the company’s business objectives, they should be encouraged to follow through on its choice by resolving obstacles to employees’ consistent, effective use of that technology.
– Since most management belong to a group of professionals, they know the benefits of membership and should encourage their clients or employers to participate in a computer users association’s special interest groups (SIGs) that focus on applying technology to meet the business needs of the company, its clients and other business partners.
– Perhaps most important, the management should stress to employees the need to encourage a positive and constructive attitude toward technology. Holding regular staff meetings to discuss the effectiveness of installed technology is one way to accomplish this. To boost the usefulness of such meetings, designated employees–volunteers, if possible–can apprise management and their peers of recent developments in technology.
Taking steps such as these increases the odds mat when B2B exchanges make a comeback, a company will be ready to work with them in a way that best capitalizes on whatever benefits they can deliver.
Challenges of E-business change
Traditionally, change management involves moving an organization from one environment to another, taking the path of least resistance from the perspective of those affected by the change. In the technology environment, for instance, a key component of implementing an enterprise resource planning (ERP) system is a concurrent change management program designed to move users of the system from one technology environment to another while, at the same time, allaying their fears about how the system will affect their daily work. Such a program requires awareness, education, and specific training.
Change management focuses on helping employees move emotionally from an “as is” to a “to be” environment which, at the beginning of an undertaking, is merely a vision. In many instances, this involves moving from paper-based to PC-based operations, from individual work to teams, and/or from work performed within strategic business units (SBUs) to work accomplished within shared services. This model focuses on discrete changes. Although many elements might be rolled into the effort, it is executed as a single program (an event or series of events) designed to accomplish a single change.
In many technology implementations, people assigned to use the system have not previously been competent PC users, and moving from paper- to PC-based processes is, for them, a daunting task. The majority of users who have PC skills learned them through formal training or on the job; very few, if any, have “grown up” with computers as part of their daily lives. Corporate instructors have to lead large classes through step-by-step lesson plans that introduce both general PC concepts as well as aspects of the particular system. Such training is required to ensure user buy-in, the lack of which is often cited as a major roadblock to successful technology implementations.
Information generated in such change-management efforts is often static and specific to the underlying programmatic changes occurring in the working environment. Because it does not apply to broad, systemic organizational change, much of this information is lost when the project is completed.
Finally, change management is seen either as a cost or budget issue. Because it is viewed as a program with measurable outcomes to be carried out within a finite time, change management could be costed on a per-day or per-person basis. Funding is generally low and terminates with the successful implementation of the system. This means that day-to-day changes that occurred after the new system is operational—that is, after “go-live”—are often treated haphazardly because the change management team has been disbanded. A change management program requires a number of resources, including experts in human resources, project management, process management, quality assurance, marketing, training, and, in the case of systems implementations, information technology (IT). To communicate change, management makes presentations to groups of employees and individuals receive a number of communications via company mail, desk drops, telephone follow-up and voice mail, email, and the company’s intranet. These tools are adequate for static information—information that does not really live much longer than the time it takes to send it. In addition, such tools are disparate, forcing employees to look for change communications in many locations. Often, different regions, departments, or business units favor different tools, resulting in information that is not globally accessible and that different business units cannot leverage. In short, much of this material is out of date even before it hits the employee’s inbox. A typical change-management program has four parts:
(1) Organizational change
(4) Reward and recognition
While these elements are similar in any change management program, we discuss them here in the context of an ERP implementation in order to make a clear comparison between a project-oriented systems implementation and the holistic change necessary when moving to a workplace.
New Business Models
(1999) categorizes a number of new types of online business model, as shown in Table 1. below. In practice, many of these categories overlap, and some are just electronic versions of existing business models, but the table provides a useful demonstration of the range of e-Commerce activities, some of which are still at an early stage of development. By the time you read this, no doubt there will be more!
Table 1: Online business model typology
|e-Shop/e-retailer||Usually with a B2C focus such as www.whsmith.co.uk|
|e-Procurement||Online business purchasing of goods (B2B)|
|e-Malls||A grouping of e-tailers that can be compared with a traditional shopping centre; see, for example,|
|e-Auctions||B2B or B2C customers bid for goods; for example,|
|Virtual communities||Groupings of customers or businesses with similar interests; for example,|
|Collaboration platforms||Enable collaboration between customers or businesses; for example,|
|Third-party marketplaces||Intermediaries bringing together buyers and sellers; for example,|
|Value chain integrators||Offer a range of services across the value chain; for example, the online events booking service|
|Value chain service providers||Provide functions for a specific part of the value chain, for example the logistics company|
|Information brokerage||Provide information for consumers or businesses, such as price comparisons:|
|Trust and other services||Provide kitemarks authenticating online service quality,|
A Mini-case study
In February 2000, General Motors, Ford and Daimler-Chrysler formed Covisint LLC, a B2B exchange made in their own image. Its purpose was simple: to drive down their procurement costs by forcing suppliers to use the Covisint Web site.
Yet, more than a year later, with all the purchasing power of the Big Three auto makers behind it, Covisint’s future is uncertain, mainly because no one has yet figured out how the giant site can make enough money to support itself and, at the same time, satisfy participants’ needs. Experts say this is true of every B2B exchange and companies of all sizes interested in participating in them.
The challenge is familiar to Ravi Kalakota. As former CEO of hsupply.com, a B2B exchange that served hotels and their suppliers until it recently shut down, he lived through the B2B sector’s ups and downs.
An exchange’s evolution consists of three phases, he says. First, buyers and sellers have to be connected to each other. Next, their business processes have to be integrated with those of the B2B exchanges they use. And third, all these systems’ inefficiencies have to be eliminated. “We’re only in the very beginning of phase one,” he emphasizes.
Kalakota knows B2B exchanges can be their own worst enemies. “They talk [as if they’re delivering the optimal efficiency of] phase three, but their rhetoric doesn’t match what they actually offer,” he says. Nevertheless, he is convinced that the exchanges one day will offer their customers great cost savings and expanded market reach. He now pursues that vision as CEO of e-Business Strategies, an intellectual property company that creates B2B strategies and looks for investment partners to implement them.
When venture capital dried up earlier, the exchange he had founded failed. “Like everyone else, hSupply.com ran out of money,” he says. “We had built our own technology to connect buyers and suppliers, and integrating their systems was next on our list. But the financial markets don’t give you time to build these things in an orderly fashion; they want everything done today.” And that leaves unmet the needs of many would-be participant companies–of all sizes–deterring them from joining an exchange.
That doesn’t surprise Glen L. , CPA, a professor of accounting and information systems at the California State University, Northridge, who says Covisint proves the theory that a B2B exchange needs more than capital to succeed. For example, finds it enlightening to evaluate exchanges from a supplier’s point of view. “Their gross margin probably will go down if they join an exchange and bid in a public forum,” he says. Add to that the high fees to install the software necessary to communicate with the exchange, the transaction fees and the one-time or annual membership fees.
On the upside, says, is the potential for increased sales and reduced payroll expenses if automation savings materialize. But these are just possibilities while the expenses are quite real. In his eyes, the exchanges now present a less than compelling value proposition.
If the exchanges create better links to participants’ systems and, in the process, increase efficiency and help lower expenses, he thinks more companies will join and some of the ballyhooed cost savings and expanded marketing reach will materialize.
points to eBay to illustrate his meaning. Even though it’s a consumer-oriented Web site, the same challenges and solutions apply. “When eBay began doing business, only people with a high-risk tolerance participated. But now millions feel comfortable with the process of bidding and selling to strangers online. People still sue eBay once in awhile over transactions that went awry. But overall, the company has worked those problems out and moved ahead.” thinks B2B exchanges could produce the same good result if they met their participants’ needs as well as eBay has.
Articulating such B2B concepts and helping clients convert them into practical benefits is the CPA’s stock in trade. Whether a company is implementing basic or advanced technology, it needs the CPA’s expertise to align its technology plans and resources with its business needs and goals. Without his or her objective analysis, the employer or client often is trapped between its own lack of knowledge and vendors’ often biased recommendations. But companies’ dire need for help in this area reflects the richness of the professional opportunities the world of B2B holds for CPAs.
Volume and Content of the Assignment
The assignment is 4186 in words. It includes all text: chapters, table of contents, references, or table of figures.
It has 7 sections and 6 sub-sections.
Rules for success
Whether they ultimately plan and manage e-business internally or externally, companies must be able to understand and master different rules for success in a newly complicated arena. To achieve “checkmate” in the increasingly challenging e-business game of chess, organizations must know how to:
Handle data. The most important–and challenging–part of moving into e-business is not designing a website with the shopping cart technology, search software, and other features to sell and communicate online. For large enterprises, the fundamental challenge–crucial to assuring a successful transformation-is data flow management. Every second, the profitability of e-business depends on the ability to complete electronic interactions based on data. Collecting, integrating, and managing this organizational data to keep the information current and maintain it despite continually increasing performance demands is the key and often-overlooked ingredient for maintaining e-business leadership.
Companies–especially those that are multinational–are often surprised at the millions of bits and bytes of electronic data that need to be gathered, integrated, and kept completely up to date. Information on inventory from the line operations needs to integrate with pricing established by the marketing department, product descriptions from communications, etc., and be represented completely and accurately over the Internet. Online customers–unlike those of mail-order catalogues, which routinely warn that advertised products may be unavailable–will be unforgiving if the posted price of a sweater they order is a week out of date or if the color they choose is temporarily out of stock. Even if the Internet business from which they order is known for hard-to-find specialty items, chances are they will be able to locate a competitor with just the click of a mouse, and terminate even long-standing relationships with their originally favored retailer.
Redefine reliability. In an e-business, shareholders judge results on more than traditional product- and process-related profitability measures. Reliability 24/7 is part of the new standard. E-businesses should put the person and machine power in place for continual monitoring of Internet site availability and on-the-spot problem resolution. Among the dangers of not doing so is tarnishing a gold-star reputation. As competition increases, the ability for customers to utilize other services becomes greater. Regardless of image, they will use those sites that they believe are reliable.
Besides “bandwidth” problems, common reasons for outages include failure to anticipate and manage continuing visitor demands properly, as well as peaks in usage. There need to be foolproof systems in place for assuring that customers never experience downtime as companies are completing a major site upgrade as people access the Internet storefront. The stakes in a supercompetitive marketplace are just too high.
Automate gradually. This advice seems contradictory given the need for immediate entry into the electronic marketplace. Organizations moving to e-business often seek to automate every operation immediately before considering the larger picture. More important than quick automation is learning from the actual operation. As the e-business becomes operational, they will learn a lot about what the customers want and what their expectations are. As they do this, they can gradually install automated processes that will support the customers’ needs.
Capitalize on visitor data to add customer value. Nowhere can more immediate and valid data be found on whether marketing and sales initiatives are working than on the Internet. Having an Internet business offers exceptional opportunities for monitoring what is most effective in building profitable customer relationships and immediately adapting an electronic “storefront” in response. The more adept companies are in changing their sites according to visitor buying behaviors, the more customers will perceive them as providing added value.
Maintain technological leadership. In the e-business world, maintaining website leadership is as essential as ongoing product leadership. E-business success depends on continually monitoring state-of-the-art Internet features to make sure a website incorporates them ahead of competitors’ sites–or uses them in particularly innovative ways. Also important is having up-to-date development expertise–either in-house or through an outside partnership. Developers need to be able to design and upgrade the back and front ends of their e-businesses using languages and tools that are universally accessible to a complete range of customers with varying operating systems, software, and Internet browsers.
Designate a project manager. Like a symphony orchestra, a company’s Internet business team includes experts of many types united by a common goal. In this case, the goal is providing complete, up-to-date, and continually accessible electronic data. The “conductor” is the project manager, who should oversee management of the Internet site and ensure that it integrates all relevant data (products, part numbers, inventory information, etc.) from the organization accurately, completely, in proper format, and in its most current form. Project managers must be able to gather data, information, and requirements from all company divisions while understanding what each piece means to the enterprise as a whole. They also need to understand how new Internet business sites may affect operation of back-end systems, and how to upgrade these systems if necessary.
Fully engage human resources. Especially when transformation to e-business begins, human resources should be a pivotal member of the team that redefines staffing structures, competency and training requirements, and successful performance. This maintains the kind of workplace that will attract and keep top intelligence technology (IT) talent. This is especially important given the large percentage of Gen Xers among IT professionals and their particular need for a positive workplace environment accompanied by exceptional salaries and benefits.
In today’s marketplace, it is recommended that transforming to e-business is increasingly mandatory. Whether outsourced or managed in-house, the change involves new operational, process management, technological, and training requirements. Effective management is essential for continued marketplace leadership. Mismanagement means eventual displacement by a new crop of e-business competitors.