TECHNOLOGICAL ASPECTS OF ELECTRONIC COMMERCE

By | February 9, 2018

Ngai and Wat (2002) outline six categories of technological issues related to electronic commerce. These six categories—security, technological components, network technology/infrastructure, support systems, algorithm/methodology, and other technical issues—cover the entire IT spec- trum. Of these, both SCM and eCRM rely heavily on security, network technology/infrastructure, and support systems for their day-to-day operations. eCRM, in particular, utilizes supporting systems for its overall success. The collection of customer information online presents several problems from an online marketing point of view. These problems include creating the proper Web interface to collect the information, determining how much information to collect, and prop- erly validating and filtering information that is collected online. Berson and fellow researchers (2000) also assert that the way a company uses customer information is fundamental to the suc- cess of CRM. They also define the primary tools for processing information, such as marketing automation, data warehousing, and data mining, which work only as part of the larger business process.

Croteau and Li (2003) find that possessing knowledge management capabilities was the most

 

 

significant critical success factor affecting CRM impact. They further state that the relationship between technological readiness and knowledge management capabilities is also significant. One can certainly make the case that SCM relies on such knowledge management technologies as well for its ultimate success. Judicious partnering with both suppliers and customers requires the man- agement of both internal and external knowledge of the organizations involved. Kenyon and Vakola (2003) utilize a survey of businesses in the grocery retailing area to determine the importance of data collection and use for CRM. They find that this critical function ranked second in importance for overall success, trailing only “maintaining a competitive advantage.” One can certainly argue that a company can maintain a competitive advantage through the collection of use of the right customer data. In fact, with the electronic version of CRM, its potential for building an advantage is greatly increased, owing to inherent efficiencies in data collection and dispersal.

A number of information technology/systems-related factors also influence the success of SCM, but technology cannot overcome poor communication. Arminas (2002) details “real-world” SCM problems due to communication problems. A major stumbling block for e-collaboration is described, involving a prime contractor and its first-tier suppliers and the poor communication between purchasers, engineering departments, and suppliers. This example points out the impact of poor communication on SCM, noting that the successful application of IT/IS cannot assure SCM success, but a poor application can most certainly achieve failure.

Another aspect of technology is technological drift. Ciborra (2000) defines “technological drift” as the gap between intent and outcome with respect to how a modern knowledge-based organization carries out its implementation of technology to manage itself. This term describes a common problem that must be overcome in the implementations of both SCM and eCRM. Ide- ally, eCRM, and CRM in general, propose three benefits for their implementation in a knowl- edge-based company (Bygstad 2003):

 

  • gives each worker the tools to manage contacts, activities, documents,
  • provides a tool for dialog marketing, allowing the company to individualize marketing ac- tivities
  • represents a synergic potential for the company, as information can lead to new products and markets

 

To achieve these intended outcomes, a company must struggle with the process of conflict and resolution between different actors, including the technology itself. Such a process is only par- tially controllable in a modern organization with empowered employees (Ciborra 2000; Bygstad 2003). A successful implementation of SCM faces the same conflict process. Angeles and Nath (2003) define the factors involved in this “technological drift” from their analysis of a survey related to EDI:

 

  • strategic commitment of top management
  • readiness for high-level EDI
  • joint partnering
  • communications
  • EDI infrastructure
  • trading partner flexibility

It should be obvious from this list that all involve some form of conflict, whether between top and middle management or between the partners in the supply chain. “Technological drift” aptly

describes what an organization must deal with when choosing the appropriate level of technology for either SCM or eCRM. Often cost/benefit analyses do not readily lend themselves to the evalu- ation of such technologies, owing to the intangible benefits described earlier. With a dearth of “hard numbers” for such analyses, this conflict process results.

 

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