The features of e-commerce have enticed most businesses to integrate its use into their operations. These businesses have developed platforms that are best suited to their needs and conduct follow-ups to ensure that they remain relevant. They also make certain that all operations are in accordance with current laws and legislation in order to prevent excessive fines and penalties. As a result, it is critical that IT professionals in businesses become acquainted with the laws of their respective countries. The increasing diversity of e-commerce has led to insecurities such as cyber thefts and malwares which impose on firms hence the need of security considerations while designing and maintaining websites.
The increasing growing needs of consumers and producers in the market has necessitated the use of electronic commerce. Incorporating e-commerce in a businesses' activities accrues many advantages to the latter thereby increasing its efficiency. With relatively more organizations venturing in e-commerce, it is advisable that other competing firms to do the same so that they can be exposed to the same working environment; feasible for fair competition. Companies have to discover the best e-commerce model which is most suitable for their structure in order to reap maximum benefits. This paper is an official business report specifying the best e-commerce model that the Bank of Plenty can adopt. It shows the bank how it can design and maintain its website in accordance to the available e-commerce legislation.
Background
The changing needs of consumers and producers in the market has led to divisive strategies to achieve optimal results for the benefit of all economic agents. The evolution of electronic commerce provides a variety of advantages to organizations and enables them to compete on a common ground. Firms not involved in e-commerce are disadvantaged since they cannot perform their activities at the same level as those initiating it. E-commerce has therefore proved to be imperative and firms should determine the best model to adopt to maximize benefits. E-commerce is however susceptible to privacy violations and firms should take the necessary precautions against this. National governments have formulated policies and regulations to ensure that the business environment is conducive for all its participants, especially that the latter's rights are not infringed.
Methods
This report was compiled based on the results of various qualitative and quantitate research done by other scholars to determine various business structures and how each operates, the best e-commerce model to adopt the advantages and disadvantages relating to each model and the measures that should be taken to ensure that the e-commerce model chosen is effective and efficient. A cost benefit analysis is done to determine the best approach to take given Bank of Plenty's structure and position in the market. Security considerations are also reviewed.
Findings and discussion
The findings of the study will be presented in five categories: - Structure and aims of business organizations - Importance and impact of e-commerce - Design and maintenance of a website - Security considerations - E-commerce legislation
Structure and aims of business organizations
The two most fundamental aims of business enterprises are to maximize profits and minimize costs. All other objectives such as attaining huge market shares, brand building and maximizing shareholders' income all fall under the major objectives. Organizations' structures are influenced by factors such as external and internal environmental factors thus dictating the two major types of structures; centralised and decentralised structures (Tran, 2013, 229). Studies show that businesses operating in risky environmental factors characterized by political instability and inflexible and strict legislation tend to have decentralised management. Decentralised structures in this case, involve delegation of power and decision making duties to lower parts of an organization. According to Tran, decentralised structures are the most advantageous since they consider factors such as types of markets, competition, comparative advantage, customer satisfaction and levels of innovation (2013,232). Different market types have different consumers with varying tastes and preferences, delegating power to lower organization staff in these different markets promotes specialization in that, each branch can produce tailor-made products basing on the markets preferences hence achieving high consumer satisfaction. This also increases producer-consumer interaction since the producer-consumer ratio has decreased thereby creating an opportunity for consumers to be heard out and served well by the management. This enables them to take advantage of favourable conditions and pay close attention to more demanding jurisdictions so that they can avoid paying unnecessary fines and penalties. All managers delegated with power are expected to report to an overall manager. Considering the fact that Bank of Plenty has forty branches in UK and one head office, it has a decentralised structure. Its e-commerce model should therefore, work best in a decentralised structured enterprise.
Importance and impact of e-commerce
E-commerce involves the buying and selling of commodities via the internet. It facilitates product promotion through the creation of a platform within which an organization can advertise the goods and services it sells. Some websites encourage consumer interaction by enabling them to rate the services rendered and even participate in publicity whereby a satisfied customer encourages potential customers to purchase a product. Consumer interaction enables producers to produce tailor-made products hence e-commerce facilitates customization of products over a relatively short period of time since producers do not have to meet consumers directly and waste time. E-commerce promotes cost minimization through facilitating information sharing mechanisms which are less costly as compared to the dependence on telephones, postage costs and meeting face to face. It also saves a significant amount of time by encouraging fast transmission of information from the recipient to the receiver enabling both parties to get immediate feedback and act on it as soon as possible. All these advantages accruing to enterprises using e-commerce increase its competitive advantage in the market since it has relatively lower advertising costs, responds to clients at shorter periods of time and designs their products to suit the needs of the market. It also facilitates doing business with people all over the world regardless of their locations hence a wider market (Wen, 2001, 6).
E-commerce is only appropriate for products that do not require buyers and sellers to build personal relationships with each other due to unguaranteed privacy (Gangeshwer, 2013, 191). It is therefore, imposes on firms selling products such as life insurance packages to limit their use of e-commerce to product promotion purposes only. Such firms are required to encourage their clients to make personal visits to their offices for them to get efficient services. Our concern, Bank of Plenty is not imposed since it provides banking services to clients and very few cases of privacy issues may arise.
Design and maintenance of a website
There are two major types of website designs; communication orientated and transactions orientated design (Wen, 2001,7). The communication orientated design complements an organization's activities and is mostly used to create product awareness and for product promotion whereas the transactions orientated design takes over the role of the organization by facilitating trade. Both designs have various e-commerce models which can be adopted basing on the objectives and capabilities of a firm. Communication oriented design has four models, cost reduction, product promotion, "info-mediary and brand awareness and image building model". An e-commerce model that specializes in creating brand awareness inform existing and potential customers the products they offer and how they give back to the society for instance through environmental preservation projects and advocating for human rights programs such as reebok; its websites stipulates the importance of exercising and the activities it has volunteered to improve individuals' health.
A product promotion website model specializes in advertisements and uses gifts to win over potential clients to visit the website hence see the prices and qualities of available products. Kodak for instance, provides demonstrations and tutorials for customers to be able to use their products with ease. Infomediary e-commerce models enable producers to get detailed information concerning consumers' buying habits in exchange for unlimited internet connectivity. This is the most beneficial model since consumer buying habits are vital in designing the products, determining the location they should be sold from and the quantity to be produced. It helps firms to cut down on the costs of producing excess products such as excess factors of production and inventory costs. The transactions oriented strategy on the hand involves "brokerage, retail, mall, subscription, customization, manufacturer" and product promotion models (Wen, 2001,10). These models are mostly used by huge corporations that intend to facilitate transactions through connecting different buyers and sellers and even advertising products mostly at a fee.
Bank of plenty can adopt both website designs, specifically the infomediary, product promotion and retail models since they are most applicable to small enterprises seeking to strengthen their brand name through brand awareness and convenient alternative services to the ones provided by their competitors.Since Bank of Plenty is most likely going to have a transactions website, the staff in the IT department are required to do several follow ups to ensure that the website is performing as expected. Website publishing ensures that the information available on the website in question is up to date (Diffily, 2006, 7). This calls for assignment of duties to staff in such a way that information is reviewed for accuracy, reliability, compliance with the existing laws and its appeal to the target audience. This promotes high quality data since the staff responsible is aware that data will be reviewed preceding its release. The website should then be accessed for conformity to the firm's standards. This is done through gathering information that can be scrutinized for quality such as absence of grammatical errors, broken links, and absurdly large pages. Errors are then listed in an issues log and forwarded to the editing team to make necessary corrections. The website should also be checked whether it gives accurate and prompt responses to customers hence its performance and whether the infrastructure it uses is efficient (Diffily, 2006, 22). It should be affordable and convenient.
Security considerations
According to Smith, e-commerce is highly susceptible to cybercrimes (2011, 8). Cybercrimes are hazardous to businesses since they cause the loss of confidential information and even trust of clients in the business. Website assurance services enable firms to maintain and attract new customers by assuring them of the safety of their personal data and even investments in the companies. Organizations are advised to register their websites with these assurance providing firms since the latter give members certificates that prove their legality and genuineness (Smith, 2011, 11). They also inform users of the personal information they have concerning clients, its use, and with whom it may be revealed to, with specified conditions.
E-commerce legislation
E-commerce laws are enforceable in a court of law if broken. They ensure that factors such as privacy and honesty are considered while making transactions, advertisements, and other promotion activities via internet (Anil, 2001, 94). Contract law, for instance, requires producers/suppliers to inform their customers of all the terms pertaining to these contracts and any changes whatsoever. This indicates that online based contracts are subject to the same terms and conditions as other contracts. Businesses engaging in e-commerce should be covered by the privacy act to ensure that they are aware of the law's requirements as per the act. This act requires them to maintain confidentiality on personal information of clients and employees, failure to do so will be punishable by law. The spam act requires organizations to ensure that promotional electronic messages are not sent to individuals without their consent. Breaching these acts may lead to fines and penalties, termination of business licenses, and even imprisonment (Klimt, 2003, 35).
Conclusion
Bank of Plenty should adopt both the communication and transactions orientated website designs so that its e-commerce model would incorporate the creation of brand awareness, advertising, and information mediation. These models are most efficient since Bank of Plenty is a new entrant in the market hence will require investing in advertisements and product promotions to increase its market share. These models will enable the bank to achieve these objectives at a relatively lower cost compared to newspaper and television advertisements. Information mediation will enable the organization to cut down on the costs of producing unnecessary surplus products. The bank's IT officials should also do regular check-ups to ensure that the website remains relevant and conforms to e-commerce regulation. Security measures should also be taken against cyber threats and viruses.
References
Anil, S., 2001. Electronic commerce in Asia: The legal, regulatory and policy issues. International Journal of Law and Information Technology, 9(2), pp 93-144.
Diffily, S., 2006. The website manager’s handbook. Lulu.com, pp 1-28.
Gangeshwer, D. K., 2013. E-commerce or internet marketing: A business review from Indian context. International Journal of u- and e- Service, Science and Technology, 6(6), pp 187-194.
Klimt, S., Symthe, N., Clark, S.S and Shailer, J., 2003. Protection of personal data. The Australian perspective. Def. Counsel. J., 70, P. 106.
Smith, K. T., 2011. Consumer perceptions regarding e-commerce and related risks. Business Quest, pp 1-22.
Tran, Q., and Tian, Y., 2013. Organizational structure: Influencing factors and impact of a firm. American Journal of Industrial and Business Management, 3, pp 229-236.
Wen, H. J., Chen, H. G. and Hwang, H. G., 2001. E-commerce website design: strategies and models. Information management & computer security, 9(1), pp.5-12.
