Benefits of e-Business (Essay Sample)

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E-business: The Benefits to the World
Web-based retailing has rapidly gained acceptance by American Internet users as a valid retail outlet CITATION Kin04 \l 1033 (King, Sen, & Xia, 2004). An increasing number of households have started to connect to the Internet, and as a result the potential for shopping on the Internet have become larger than ever. The spread of global Internet connectivity, the lowering of unit costs, the internationalization of the markets for goods, labor, and information, e-commerce is said to offer businesses in developing countries a chance to access global markets easily, operate efficiently, and compete fairly CITATION Mol05 \l 1033 (Molla & Licker, 2005). Many e-commerce principles were pioneered in the airline industry CITATION Bar01 \l 1033 (Barry, Gunther, Rao, & Ratliff, 2001). These include the first business-to-business electronic information exchange and industry wide electronic market place. Airlines have continuously expanded their use of information technology for reservations systems and created an infrastructure that facilitates the application of e-commerce related technologies.
Researchers and practitioners assert that e-commerce has many benefits for retailers CITATION Zhu03 \l 1033 (Zhuang & Lederer, 2003). Among them are increased sales, lower costs, better customer awareness of products, access to new markets, better customer service, improved operational effectiveness and efficiency, better control of data, shipment tracing, and streamlined inventory replenishment CITATION Zhu03 \l 1033 (Zhuang & Lederer, 2003). Such e-commerce benefits as increased profitability and market share are of paramount importance, but they are not the only benefits of e-commerce and are not necessarily easy to measure and attribute to e-commerce. The realization of Back-end Efficiency, Market Expansion, Inventory Management, Cost Reduction, and Customer Service benefits would be expected to produce improved productivity and increased sales, and thus greater profitability and overall performance with improved competitive position as the eventual outcome CITATION Zhu03 \l 1033 (Zhuang & Lederer, 2003). Providing sellers with an opportunity to reach a wider audience, Web-based sales channels also give them better control of their sales and marketing activities CITATION Kin04 \l 1033 (King, Sen, & Xia, 2004). Perhaps more specifically, Back-end Efficiency, Inventory Management, and Cost Reduction benefits would improve productivity, whereas Market Expansion and Customer Service benefits would increase sales. In any case, the benefits would be expected to predict performance of these industries, such as the airline industry.
Airlines, being one of the industries that pioneered on the use of e-commerce realize the importance of such technologies and strategies that are incorporated to marketing points of e-commerce. From a period in which Airline employees used binoculars to read flight availability, the entry of computer technology allowed airlines and there employees were able to resolve the problem after applying computer technology.
"It was the first real-time business application of computer technology, an automated system with complete passenger records available electronically to any agent connected to the Sabre System”
CITATION Bar01 \l 1033 (Barry, Gunther, Rao, & Ratliff, 2001).
The particular advantage of e-commerce indirectly related to market output is the increase of the operational effectiveness of the employees CITATION Blo05 \l 1033 (Blount, Castleman, & Swatma, 2005). As customers move toward self-service technologies such as what e-commerce provides, employees need to cope-up to the changes and have to adapt to the changing environment. Having applied e-commerce strategies, high levels of employee commitment had contributed to its success in interaction with customers CITATION Blo05 \l 1033 (Blount, Castleman, & Swatma, 2005). The adaptation and the application of technological advancements allowed airline companies not only to increase their sales, but also allowed a much more comfortable environment, both for the customers and the employees. In the part of effectiveness, from a long period of 45 minutes to file a reservation it was brought down into just 3 seconds, allowing an increase of passenger-reservation transactions to increase up to 1.2 million reservations per day during the period of 1999 (Blount, Castleman, &am...