Management Consulting/E-Commerce

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Question
Dear Sir,

Please help me on the below, need answer for any three question

1.   Explain B2C E-Commerce of a customer reserving airline tickets from his home or place of work. Compare and contrast B2B and B2C and give examples.  
2.   "Internet has emerged as a competitive advertising media." Discuss. Evaluate the effectiveness of various models of Internet Advertising.
3.   "With the adoption of E-Commerce by business houses, organization structures are also likely to change." Discuss the above statement with help of suitable examples.   
4.   (a) What is E-banking? Discuss the banking activities where E-banking has been accepted by the public.
(b) What is public key encryption? In what way is it different from private key encryption? Why is it important in E-Commerce?

Answer
1. Explain B2C E-Commerce of a customer reserving airline tickets from his home or place of work. Compare and contrast B2B and B2C and give examples.

B2C e-Commerce involves the business between an individual and an
organization.
For the case given in question, the customer has to visit the site of the travel
agency or a broker and get the status of the availability of tickets. If ticket is
available he/she will book the ticket and input the credit card details. He/She
will be given the details of delivery of ticket.
The list  below depicts the total process

Customer Website of travel agency
Travel agency’s bank A/C
Credit Card companies computer
Customer’s Bank

(1)   Request Service
Customer >>>>>>>>>>>>> Website of  travel agency
(2) Display information on various flights
(3) Places order with credit card details
(4) Credit card details
(5) Ok’s Credit card
Travel agency’s bank A/C     Credit Card companies  Computer

(7) Debit advice giving credit card no
(8) Credit to travel agency’s A/C
(8) Bill to Customer
(8) Acknowledge order and sends ticket
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2. "Internet has emerged as a competitive advertising media." Discuss. Evaluate the effectiveness of various models of Internet Advertising.

Internet advertising has proven to be a targeted approach to reaching your customer base, and is easily the most cost effective and measurable method of obtaining new customers.

It's an ideal way to reach potential customers with a solution that's cost effective, offers precise targeting and easy to understand tracking tools. Online search advertising reaches over 94.5% of Australian internet users who use search engines to find products or services online.

Each one of these users is interested in the search keywords they have entered, which makes the web such an effective way to connect with prospects interested in your business.
Benefits for your Business
•   Being found first in search results
•   Gaining an advantage over your competitors
•   Attaining the highest rate of traffic to your website
•   Taking your position as your industry's leader
•   Attracting more quality sales leads
•   Increasing business revenue
•   Improving business sustainability
There are quite a few ways to use online marketing to advertise your business, but that doesn’t mean that you should. Start by developing a strategy that answers why before you determine the how. That being said, here are ten different ways to advertise online:
1.   Local Listings: These are free and are a must for local businesses. More than likely, your business already has a listing that just needs to be claimed. Most of this type of content was provided by larger Yellow Pages like companies like InfoUSA that have been collecting this information for years. Make sure your Google Places and CitySearch listings are claimed, updated, and have as much information as possible.
2.   Search Advertising (aka Pay-Per-Click Advertising): Picking and choosing when to display ads for your product or service based on potenetial customers’ search keywords has turned the advertising world on it’s head. Never before have you been able to target just those who are in the market for what you sell. Even better, this advertising model only charges you when someone clicks your ad, so the more targeted you make your marketing message, the better.
3.   Contextual Advertising: You’re finding new customers who already know they need your product, but what about those who don’t? Contextual advertising gives you the ability to target a specific demographic (i.e. women ages 25-40) who fit your customer profile. Specify your criteria and find websites that match your customer profile to find new customers.
4.   Display Ads: Display ads are featured in various ad sizes throughout website and utilize many of the targeting options mentioned in this list. Display ads can be static images, flash, video and expandable.
5.   Geotargeting: Sell a generally needed product to a specific area? You might be successful utilizing geotargeted advertising which can be targeted down to the zip code of the online viewer.
6.   Group Buying: Sites like LivingSocial and Groupon have become extremely popular, literally guanteeing customers for businesses. However, these “deal sites” come with a price and often result in very few long-term customers. These can work for certain businesses, but do your research and tread with caution here.
7.   Mobile Marketing: Mobile is becoming a bigger market for targeted advertising as phones and tablets with iOS and Android mobile operation systems become more popular. Mobile marketing can include SMS messaging and mobile targeted ads. You should start collecting your customers mobile phone numbers and permission to send them announcements now, even if you don’t have a strategy in place.
8.   Social Networking: Facebook and Twitter have opened the door for the rise of the virtual “Word-of-Mouth” referral, which is a large factor in many consumer buying decisions. Companies should be building a social media strategy that involves use of networks (large and small) that make sense for their industry.
9.   Affiliate Marketing: Affiliate marketing can be a great way to make sales, as it effectively is the outsourcing of a sales staff to users who are selling your product for a small commission per sale.
10.   Online Videos: Video is a great way to make your product or service even more real to those who are visiting your website. Customer testimonials, product overviews, and demos all work nicely and properly titled videos can drive SEO based traffic.

Online advertising, also known as online advertisement, internet marketing, online marketing or e-marketing, is the marketing and promotion of products or services over the Internet.
Online advertising is a form of promotion that uses the Internet and World Wide Web to deliver marketing messages to larger audience.
Examples of online advertising include contextual ads on search engine results pages, banner ads, blogs, rich media ads, social network advertising, interstitial ads, online classified advertising, advertising networks, dynamic banner ads, cross-platform ads and e-mail marketing, including e-mail spam. Many of these types of ads are delivered by an ad server.
Online advertising is a form of promotion that uses the Internet and World Wide Web to deliver marketing messages to attract targeted customers.
Competitive advantage over traditional advertising
One major benefit of online advertising is the immediate publishing of information and content that is not limited by geography or time. To that end, the emerging area of interactive advertising presents fresh challenges for advertisers who have hitherto adopted an interruptive strategy.
Another benefit is the efficiency of the advertiser's investment. Online advertising allows for the customization of advertisements, including content and posted websites. For example, AdWords, Yahoo! Search Marketing and Google AdSense enable ads to be shown on relevant web pages or alongside search results. Although the overall return is not quantifiable as many Internet users either use ad blocking software or simply do not respond to online adverts as they regard them as an invasive platform.
Online advertisement
The internet has become an ongoing emerging source that tends to expand more and more. The growth of this particular medium attracts the attention of advertisers as a more productive source to bring in consumers.
A clear advantage consumers have with online advertisement is the control they have over the product, choosing whether to check it out or not.[11]
Online advertisements may also offer various forms of animation. In its most common use, the term "online advertising" comprises all sorts of banner, e-mail, in-game, and keyword advertising, including on platforms such as Facebook, Twitter, and MySpace. Web-related advertising has a variety of ways to publicize and reach a niche audience to focus its attention to a specific group. Research has proven that online advertising has given results and is a growing business revenue.[12] For the year 2012, Jupiter Research predicted $34.5 billion in US online advertising spending.
Types of Internet marketing
Internet marketing is broadly divided in to the following types:
Display advertising: the use of web banners or banner ads placed on a third-party website or blog to drive traffic to a company's own website and increase product awareness.
Search engine marketing (SEM): a form of marketing that seeks to promote websites by increasing their visibility in search engine result pages (SERPs) through the use of either paid placement, contextual advertising, and paid inclusion, or through the use of free search engine optimization techniques also known as organic result.
Search engine optimization (SEO): the process of improving the visibility of a website or a web page in search engines via the "natural" or un-paid ("organic" or "algorithmic") search results.
•   Social media marketing: the process of gaining traffic or attention through social media websites such as Facebook, Twitter and LinkedIn.[15]
•   Email marketing: directly marketing a commercial message to a group of people using electronic mail.
•   Referral marketing: a method of promoting products or services to new customers through referrals, usually word of mouth.
•   Affiliate marketing: a marketing practice in which a business rewards one or more affiliates for each visitor or customer brought about by the affiliate's own marketing efforts.
•   Content marketing: the process of creating specialized content such as infographics, blog articles and ebooks to attract more customers.
•   Inbound marketing: involves creating and freely sharing informative content as a means of converting prospects into customers and customers into repeat buyers.
•   Video marketing: This type of marketing specializes in creating videos that engage the viewer into a buying state by presenting information in video form and guiding them to a product or service[citation needed] Online video is increasingly becoming more popular among internet users and companies are seeing it as a viable method of attracting customers.[16]
Internet marketing is associated with several business models:
•   E-commerce: a model whereby goods and services are sold directly to a consumer or business.
•   Lead-based websites: a strategy whereby an organization generates value by acquiring sales leads from its website.[citation needed] Similar to walk-in customers in retail world. These prospects are often referred to as organic leads.
•   Affiliate marketing: a process wherein a product or service developed by one entity is sold by other active sellers for a share of profits. The entity that owns the product may provide some marketing material (e.g., sales letters, affiliate links, tracking facilities, etc.); however, the vast majority of affiliate marketing relationships come from e-commerce businesses that offer affiliate programs.
Revenue models
The three most common ways in which online advertising is purchased are CPM, CPC, and CPA.
•   CPM (Cost Per Mille) or CPT (Cost Per Thousand Impressions) is when advertisers pay for exposure of their message to a specific audience. "Per mille" means per thousand impressions, or loads of an advertisement. However, some impressions may not be counted, such as a reload or internal user action.
•   CPV (Cost Per Visitor) is when advertisers pay for the delivery of a Targeted Visitor to the advertisers website.
•   CPV (Cost Per View) is when advertisers pay for each unique user view of an advertisement or website (usually used with pop-ups, pop-unders and interstitial ads).
•   CPC (Cost Per Click) or PPC (Pay per click) is when advertisers pay each time a user clicks on their listing and is redirected to their website. They do not actually pay for the listing, but only when the listing is clicked on. This system allows advertising specialists to refine searches and gain information about their market. Under the Pay per click pricing system, advertisers pay for the right to be listed under a series of target rich words that direct relevant traffic to their website, and pay only when someone clicks on their listing which links directly to their website. CPC differs from CPV in that each click is paid for regardless of whether the user makes it to the target site.
•   CPA (Cost Per Action or Cost Per Acquisition) or PPF (Pay Per Performance)
•    advertising is performance based and is common in the affiliate marketing sector of the business. In this payment scheme, the publisher takes all the risk of running the ad, and the advertiser pays only for the number of users who complete a transaction, such as a purchase or sign-up. This model ignores any inefficiency in the seller's web site conversion funnel. The following are common variants of CPA:
o   CPL (Cost Per Lead) advertising is identical to CPA advertising and is based on the user completing a form, registering for a newsletter or some other action that the merchant feels will lead to a sale.
o   CPS (Cost Per Sale), PPS (Pay Per Sale), or CPO (Cost Per Order) advertising is based on each time a sale is made.
•   eCPM: Effective CPM or eCPM calculated through other conversion events such as Cost per Clicks, Cost per Downloads, Cost per Leads etc. for example when an advertiser getting $2 per download and for 100,000 impressions you received 10 downloads worth $20, in this case your effective CPM or eCPM will be 2*20*1000/100,000= $0.4
•   Fixed Cost: Advertiser paying fixed cost for delivery frame by campaign flight dates without any relevance to performance
•   Cost per conversion Describes the cost of acquiring a customer, typically calculated by dividing the total cost of an ad campaign by the number of conversions. The definition of "Conversion" varies depending on the situation: it is sometimes considered to be a lead, a sale, or a purchase.
Online advertisement as Digital Promotions for Television
Online advertisement can also be classified as Digital Promotions. Digital promotion in connection to the television industry is when networks use authentic digital resources to promote their new shows in a growing vast range of venues. Television networks development of digital off air promotional strategies allowed digital promotion to remain significant to the advertisement advancement in the television.
Examples of television online digital promotions: The Sci Fi network for loaded a special recap episode of Battlestar Galactica onto Microsoft’s Xbox online gaming service; this gave the audience additional opportunities to sample content if they may or may not be familiar with the show.] Another example of digital promotion in television is when network CBS incorporated new digital technologies of Bluetooth-enabled mobile devices that were able to download a thirty-second clip of a new show on their devices; consumers standing in range of a billboard don’t need an internet link to download the show’s content.[21] These non-linear viewing opportunities provided as a valuable tool for gaining audiences; and to encourage them to intersect with the linear audience.[

Approaches
One-to-one approaches
In a one-to-one approach, marketers target a user browsing the Internet alone and so that the marketers' messages reach the user personally. This approach is used in search marketing, for which the advertisements are based on search engine keywords entered by the users. This approach usually works under the pay per click (PPC) method.
Appeal to specific interests
When appealing to specific interests, marketers place an emphasis on appealing to a specific behavior or interest, rather than reaching out to a broadly defined demographic.[citation needed] These marketers typically segment their markets according to age group, gender, geography, and other general factors.
Appealing to specific users can be achieved through behavioral targeting which refers to the use of behavioral patterns and putting up the relevant content suitable to the viewer's interest obtained from the user through cookies and other tools and contextual advertising which refers to the publishing of advertisements and ads based on the context the user in. For example if the user is searching for coffee, the search engine publishes ads related to coffee.
Niche marketing
In conventional niche marketing, clusters of consumers (the niche) are identified in order to more economically and efficiently target them.[23] Similarly, niche internet marketing attempts to create a more direct advertising message for those who are seen as most likely to buy the product being advertised (see Target audience and Conversion rate).
Niche internet marketing focuses on marketing products and services which are, or can appear, tailor-made for a specific subset of consumers who are expected to buy the product or service with a specific motivation. The online advertising message (or product web site) can then be similarly tailor-made to target that assumed motivation. In combination with search engine optimization, the niche internet marketer can attempt to increase the likelihood that their product's advertisement (or site) will be seen by customers in the relevant niche.
Geo-targeting
In Internet marketing, geotargeting is the methods of determining the geolocation of a website visitor with geolocation software, and delivering different content to that visitor based on his or her location, such as latitude and longitude, country, region or state, city, metro code or zip code, organization, Internet Protocol (IP) address, ISP, and other criteria.
•   Floating ad: An ad which moves across the user's screen or floats above the content.
•   Expanding ad: An ad which changes size and which may alter the contents of the webpage.
•   Polite ad: A method by which a large ad will be downloaded in smaller pieces to minimize the disruption of the content being viewed
•   Wallpaper ad: An ad which changes the background of the page being viewed.
•   Trick banner: A banner ad that looks like a dialog box with buttons. It simulates an error message or an alert.
•   Pop-up: A new window which opens in front of the current one, displaying an advertisement, or entire webpage.
•   Pop-under: Similar to a Pop-Up except that the window is loaded or sent behind the current window so that the user does not see it until they close one or more active windows.
•   Video ad: similar to a banner ad, except that instead of a static or animated image, actual moving video clips are displayed. This is the kind of advertising most prominent in television, and many advertisers will use the same clips for both television and online advertising.
•   Map ad: text or graphics linked from, and appearing in or over, a location on an electronic map such as on Google Maps.
•   Mobile ad: an SMS text or multi-media message sent to a cell phone.
•   Superstitial: An animated ad on a Web page from Enliven Marketing Technologies. It uses video, 3D content or Flash to provide a TV-like advertisement. Used to be known as Unicast Transitional ads as they were originally made by Unicast Communications but the company was acquired by Viewpoint Corporation in 2004, which then changed its name to Enliven in 2008.
•   Interstitial ad: a full-page ad that appears before a user reaches their original destination.
•   Frame ad: an ad that appeared within an HTML frame, usually at the top with the site logo. As the user browsed the site, the frame would not change.
In addition, ads containing streaming video or streaming audio are becoming very popular with advertisers.
E-mail advertising
Legitimate Email advertising or E-mail marketing is often known as "opt-in e-mail advertising" or permission marketing to distinguish it from spam.
Display advertising
Display advertising appears on web pages in many forms, including web banners. These banners can consist of static or animated images, as well as interactive media that may include audio and video elements. Display advertising on the Internet is widely used for branding. This is why metrics like interaction time are becoming more relevant. This may change in the future as display advertising is becoming much more targeted to users, much like how search engine ads can be extremely relevant to users based on what they are searching for. Display advertisers use cookie and browser history to determine demographics and interests of users and target appropriate ads to those browsers. Banner ad standards have changed over the years to larger sizes, in part due to increased resolution of standard monitors and browsers, in part to provide advertisers with more impact for their investment. The standards continue to evolve. Banner ads can be targeted to internet users in many different ways in order to reach the advertiser's most relevant audience. Behavioral retargeting, demographic targeting, geographic targeting, and site based targeting are all common ways in which advertisers choose to target their banner ads.
Affiliate marketing
Affiliate marketing is a form of online advertising where advertisers place campaigns with a potentially large number of small (and large) publishers, who are only paid media fees when traffic to the advertiser is garnered, and usually upon a specific measurable campaign result (a form, a sale, a sign-up, etc.). Today, this is usually accomplished through contracting with an affiliate network.
Affiliate marketing was an invention by CDNow.com in 1994 and was excelled by Amazon.com when it launched its Affiliate Program, called Associate Program in 1996. The online retailer used its program to generate low cost brand exposure and provided at the same time small websites a way to earn some supplemental income.
Behavioral targeting
In addition to contextual targeting, online advertising can be targeted based on a user's online behavior. This practice is known as behavioral targeting. For example, if a user is known to have recently visited a number of automotive shopping / comparison sites based on clickstream analysis enabled by cookies stored on the user's computer, that user can then be served auto-related ads when they visit other, non-automotive sites.
Semantic advertising
Semantic advertising applies semantic analysis techniques to web pages. The process is meant to accurately interpret and classify the meaning and/or main subject of the page and then populate it with targeted advertising spots. By closely linking content to advertising, it is assumed that the viewer will be more likely to show an interest (i.e., through engagement) in the advertised product or service.
Social network advertising
Social network advertising is a form of Online advertising that focuses on social networking sites. Advertising on social media networks can take the form of direct display ad buys at the social networks, self-serve advertising through internal ad networks, and ad serving on social network applications through special social network application advertising networks.[27]
Advantages and limitations of Internet marketing
Advantages
Internet marketing is inexpensive when examining the ratio of cost to the reach of the target audience. Companies can reach a wide audience for a small fraction of traditional advertising budgets. The nature of the medium allows consumers to research and to purchase products and services conveniently. Therefore, businesses have the advantage of appealing to consumers in a medium that can bring results quickly.
Internet marketers also have the advantage of measuring statistics easily and inexpensively; almost all aspects of an Internet marketing campaign can be traced, measured, and tested, in many cases through the use of an ad server. The advertisers can use a variety of methods, such as pay per impression, pay per click, pay per play, and pay per action. Therefore, marketers can determine which messages or offerings are more appealing to the audience. The results of campaigns can be measured and tracked immediately because online marketing initiatives usually require users to click on an advertisement, to visit a website, and to perform a targeted action.
Problems of online advertising
Privacy

The use of online advertising has implications on the privacy and anonymity of users. Hosting the banner images on its servers and using third-party cookies, the advertising company is able to track the browsing of users across these two sites.
Third-party cookies can be blocked by most browsers to increase privacy and reduce tracking by advertising and tracking companies without negatively affecting the user's Web experience. Many advertising operators have an opt-out option to behavioral advertising, with a generic cookie in the browser stopping behavioral advertising.
Malware
There is also a class of advertising methods which are considered unethical and may even be illegal. These include external applications which alter system settings (such as a browser's home page), spawn pop-ups, and insert advertisements into non-affiliated webpages. Such applications are usually labelled as spyware or adware. They may mask their questionable activities by performing a simple service, such as displaying the weather or providing a search bar. These programs are designed to dupe the user, acting effectively as Trojan horses. These applications are commonly designed so as to be difficult to remove or uninstall. The ever-increasing audience of online users, many of whom are not computer-savvy, frequently lack the knowledge and technical ability to protect themselves from these programs.
Limitations
•   One of the challenges that Internet marketers face (as does the general public) is that many internet products are outright scams or promoted with deception making it difficult to know which one is worth buying. This is especially the case with products that are supposed to train or aid Internet marketers in making money. While the quality of products has improved in the past few years, ethics are often still missing in online marketing. Many so-called money making products are "empty boxes" in which there is essentially nothing there, yet a buyer is to make money by reselling this empty box to others. Pyramid schemes are also still prevalent.
•   The consumer is unable to physically feel or try on the product which can be a limitation for certain goods. However a survey of consumers of cosmetics products shows that email marketing can be used to interest a consumer in visiting a store to try a product or to speak with sales representatives; from here a purchase decision can be made [30]
•   The marketer will not be able to use personal interaction to influence the audience as the marketing is completely based on the advertisement and the information that the advertisement might lead to (websites, blogs and other channels).
Security concerns
  
Information security is important both to companies and consumers that participate in online business. Many consumers are hesitant to purchase items over the Internet because they do not believe that their personal information will remain private. Some companies that purchase customer information offer the option for individuals to have their information removed from their promotional redistribution, also known as opting out. However, many customers are unaware if and when their information is being shared, and are unable to stop the transfer of their information between companies if such activity occurs. Additionally, companies holding private information are vulnerable to data attacks and leaks. Internet browsing privacy is a related consumer concern. Web sites routinely capture browsing and search history which can be used to provide targeted advertising. Privacy policies can provide transparency to these practices. Spyware prevention software can also be used to shield the consumer.
Another consumer e-commerce concern is whether or not they will receive exactly what they purchase. Online merchants have attempted to address this concern by investing in and building strong consumer brands (e.g., Amazon.com, eBay, and Overstock.com), and by using merchant and feedback rating systems and e-commerce bonding solutions. All these solutions attempt to assure consumers that their transactions will be free of problems because the merchants can be trusted to provide reliable products and services. Additionally, several major online payment mechanisms (credit cards, PayPal, Google Checkout, etc.) have provided back-end buyer protection systems to address problems if they occur.
Ethics
Online advertising encompasses a range of types of advertising, some of which are deployed ethically and some are not. Some websites use large numbers of advertisements, including flashing banners that distract the user, and some have misleading images designed to look like error messages from the operating system, rather than advertisements. Websites that unethically use online advertising for revenue frequently do not monitor what advertisements on their website link to, allowing advertisements to lead to sites with malicious software or audience-inappropriate material. The ethical propriety of advertisers that use web searches for competitors' brands to trigger their own ads has been questioned.[31]
Some argue that website operators who ethically use online advertising typically use a small number of advertisements that are not intended to distract or irritate the user, and do not detract from the design and layout of their websites.[32] Many website owners deal directly with companies that want to place ads, meaning that the website linked to by the advertisement is legitimate.
The use of technologies like Adobe Flash in online advertising has led to some users disabling it in their browsers, or using browser plug-ins like Adblock or NoScript. Many sites use centralized advertising services whose advertisement may be blocked as a side effect of security and privacy measures, because the services require JavaScript and cross-site requests to function, while such features are often not necessary to use the sites and are a potential source of vulnerabilities.
Some companies perform customer engagement studies in online marketing to insure consumer satisfaction, through the use of online compliance centers, building and deploying fraud detection tools, while inspecting websites and publishers to insure website pages offer the highest degree of information security and compliance with Can Spam Requirements.[
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Usage trends
Technological advancements in the telecommunications industry have dramatically affected online advertising techniques. Many firms are embracing a paradigm that is shifting the focus of advertising methodology from traditional text and image advertisements to those containing more recent technologies like JavaScript and Adobe Flash . As a result, advertisers can more effectively engage and connect their audience with their campaigns that seek to shape consumer attitudes and feelings towards specific products and services. Some new trends for internet marketing are inbound marketing, mobile marketing and improved usage of analytics. Inbound marketing refers to content and design, is the information and display relevant and attractive enough to entice your audience. Mobile marketing is huge, with over 75% of the world having access to a mobile devices, it's imperative that companies go mobile. Analytic improvement can now discover sentiment to forecast emerging trends in the industry, giving companies the knowledge they need to determine best strategies for increasing sales.[
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3. "With the adoption of E-Commerce by business houses, organization structures are also likely to change." Discuss the above statement with help of suitable examples.

Digital information technology has reduced the cost, inconvenience and time involved in communication within and outside an enterprise. A 2000 study by Bresnahan, Brynjolfsson, and Hitt titled " IT, Workplace Organization and the Demand for Skilled Labor: A Firm-level Analysis" found that "firms that adopt decentralized organizational structures and work structures do appear to have a higher contribution of IT [information technology] to productivity." The advent of the personal computer and digital communication technology has led to flatter, less hierarchical organizational structures in business, particularly in e-business. Flatter organizational structures are less centralized, allowing greater workplace innovation and distributing decision-making authority throughout all levels of the organization.
Organizational Structure
There are many organizational structures, but they can be simply categorized into being either centralized or decentralized and either tall or flat. The organizational structure reflects the way information flows within a company, how tasks are assigned and supervised and the degree of control that top management exercises over the entire enterprise. A tall organizational structure is a centralized organization with all decision-making authority at the top and information flowing down the hierarchy. A bureaucracy is a tall, centralized organization. A flat, or horizontal, organizational structure is more decentralized, with a two-way flow of information between management and staff.
Fast
An e-business operates at a greater speed than a traditional business prior to the popularization of digital technology and commercialization of the Internet. Brick-and-mortar business transactions are characterized by the customer traveling to the store, entering the store, talking with a sales person and, if the desired item is in stock, purchasing it and then traveling back to his home or office. An e-business transaction takes much less time, as the customer simply finds an online retailer, selects the product, pays with a debit or credit card and awaits delivery in a day or two. Before the customer exits the website, the money is already paid and the goods ordered out for shipping. This rapid transaction time requires a quick operational response and often presents problems or questions that must be settled immediately. A flat, decentralized structure is better suited to the rapid response requirements of e-commerce.
Flexible
Many e-commerce companies maintain inventory at warehouse locations far from their transaction centers. These transaction centers may also be located at different places around the globe. The rapid interplay of financial transactions, fulfillment and customer service across distances and different business cultures requires flexibility in an organizational structure. Decisions must be made at the point where a problem arises, not delayed until top management gets around to them. For this reason, a tall, hierarchical structure is ill-suited to e-business needs.
Innovative
E-business is also characterized by innovation -- a characteristic that thrives in a flat or horizontal organizational structure because of the wide distribution of decision-making authority. In a tall organizational structure, rules and standardized processes and procedures control operations so innovation must be approved at the top of the hierarchy before application in operations. This takes time and discourages the personal initiative that results in innovation.
 
•   The e-Business Advisory Committee (EAC) establishes the vision and mission and is responsible for the overall success of the ATA e-Business Program.
•   The e-Business Steering Group (ESG) is responsible for setting the strategic goals and managing the working groups, project teams and change requests to achieve the vision and mission.
•   Functional Interest Groups (FIG) are communities of subject matter experts that are centered around a particular business area and are responsible for specific sections of the specifications.
•   Integration Working Groups (IWG) are teams of technical experts that provide the technical foundation and best practices that are applied across all functional areas and specifications.
•   Project Teams (PT) are temporary teams formed as needed to focus on specific specification development tasks. Participation on Project Teams may be drawn from several FIGs and/or IWGs as required.






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4. (a) What is E-banking? Discuss the banking activities where E-banking has been accepted by the public.

E-banking) allows customers of a financial institution to conduct financial transactions on a secure website operated by the institution, which can be a retail or virtual bank, credit union or building society.
To access a financial institution's online banking facility, a customer having personal Internet access must register with the institution for the service, and set up some password (under various names) for customer verification. The password for online banking is normally not the same as for telephone banking. Financial institutions now routinely allocate customer numbers (also under various names), whether or not customers intend to access their online banking facility. Customer numbers are normally not the same as account numbers, because a number of accounts can be linked to the one customer number. The customer will link to the customer number any of those accounts which the customer controls, which may be cheque, savings, loan, credit card and other accounts. Customer numbers will also not be the same as any debit or credit card issued by the financial institution to the customer.
To access online banking, the customer would go to the financial institution's website, and enter the online banking facility using the customer number and password. Some financial institutions have set up additional security steps for access, but there is no consistency to the approach adopted.
Online banking facilities offered by various financial institutions have many features and capabilities in common, but also have some that are application specific.
The common features fall broadly into several categories
•   A bank customer can perform some non-transactional tasks through online banking, including -
o   viewing account balances
o   viewing recent transactions
o   downloading bank statements, for example in PDF format
o   viewing images of paid cheques
o   ordering cheque books
o   download periodic account statements
o   Downloading applications for M-banking, E-banking etc.
•   Bank customers can transact banking tasks through online banking, including -
o   Funds transfers between the customer's linked accounts
o   Paying third parties, including bill payments (see, e.g., BPAY) and telegraphic/wire transfers
o   Investment purchase or sale
o   Loan applications and transactions, such as repayments of enrollments
o   Register utility billers and make bill payments
•   Financial institution administration
•   Management of multiple users having varying levels of authority
•   Transaction approval process
Some financial institutions offer unique Internet banking services, for example
•   Personal financial management support, such as importing data into personal accounting software. Some online banking platforms support account aggregation to allow the customers to monitor all of their accounts in one place whether they are with their main bank or with other institutions.
Security


Security token device for online banking.
Security of a customer's financial information is very important, without which online banking could not operate. Financial institutions have set up various security processes to reduce the risk of unauthorised online access to a customer's records, but there is no consistency to the various approaches adopted.
The use of a secure website has become almost universally adopted.
Though single password authentication is still in use, it by itself is not considered secure enough for online banking in some countries. Basically there are two different security methods in use for online banking.
•   The PIN/TAN system where the PIN represents a password, used for the login and TANs representing one-time passwords to authenticate transactions. TANs can be distributed in different ways, the most popular one is to send a list of TANs to the online banking user by postal letter. The most secure way of using TANs is to generate them by need using a security token.[citation needed] These token generated TANs depend on the time and a unique secret, stored in the security token (two-factor authentication or 2FA). Usually online banking with PIN/TAN is done via a web browser using SSL secured connections, so that there is no additional encryption needed.
Another way to provide TANs to an online banking user is to send the TAN of the current bank transaction to the user's (GSM) mobile phone via SMS. The SMS text usually quotes the transaction amount and details, the TAN is only valid for a short period of time. Especially in Germany, Austria and The Netherlands, many banks have adopted this "SMS TAN" service as it is considered very secure.
•   Signature based online banking where all transactions are signed and encrypted digitally. The Keys for the signature generation and encryption can be stored on smartcards or any memory medium, depending on the concrete implementation.
Popular services covered under E-Banking ↓
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The popular services covered under E-banking include :-
1.   Automated Teller Machines,
2.   Credit Cards,
3.   Debit Cards,
4.   Smart Cards,
5.   Electronic Funds Transfer (EFT) System,
6.   Cheques Truncation Payment System,
7.   Mobile Banking,
8.   Internet Banking,
9.   Telephone Banking, etc.

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Advantages of E-Banking ↓
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The main advantages of E-banking are :-
1.   The operating cost per unit services is lower for the banks.
2.   It offers convenience to customers as they are not required to go to the bank's premises.
3.   There is very low incidence of errors.
4.   The customer can obtain funds at any time from ATM machines.
5.   The credit cards and debit cards enables the Customers to obtain discounts from retail outlets.
6.   The customer can easily transfer the funds from one place to another place electronically.
Internet Banking Security
Bendigo Bank is very conscious of the security of all Customer information. We have taken steps to protect the confidentiality of your accounts. All Online banking transactions sent over the Internet are specially encrypted using 128-bit encryption to maximise Internet Banking security.
Only registered users can access e-banking. When you register, you will receive a unique Access ID number and a temporary PIN. The first time you use the service, you are asked to select a PIN of your choice. Therefore no-one else can access your information, and you must keep these numbers confidential.
e-banking includes a special service called 'Secure Email' which allows you to communicate with us throughout your Online banking. This is provided in a secure environment to protect your information. To protect your privacy, we recommend you do not use standard Internet email when communicating information about your accounts.
For more information about Internet Banking Security, click here.
e-banking Security Tokens
You are required to enter your Access ID and secret PIN to begin your e-banking session. As a second level of protection, Bendigo Bank provides all customers the option of Security Tokens. You will be required to have a Security Token if you are authorising payments to third parties.
It looks like a key ring with a digital number display. At the press of a button, it generates a six-digit number called an Authentication Key. A different number will be generated every 36 seconds and each number can only be used once. This reduces the risk of criminals conducting any unauthorised activity as they will not have the Token to access the Authentication Key.
We strongly recommend you activate your e-banking Security Token to protect your details at each of the following stages of your banking session:
•   Your online banking logon
•   Making changes to your payee list
•   Making online banking payments (this is compulsory)
We will activate your Token before sending it to you so you will be protected from the moment you begin.
For more information about e-banking Security Tokens, click here.
Internet Banking Fees
There are some transaction fees associated with e-banking and these fees may vary depending on the type of account you are transacting on. Further details are available in the individual account descriptions or in our Schedule of Fees & Charges and Transaction Account Rebates.
Account inquiries are free.
Personal e-banking
Personal e-banking provides a range of convenient online banking services.
•   Account Balances - for all of your Bendigo Bank accounts.
•   Interest and Charges History provides a summary of the interest and charges (by account) for the financial year.
•   Funds Transfer - transfer between your accounts today, set up a future transfer or a regular recurring transfer.
•   Bill Payment - of all your bills which display the BPAY logo.
•   BPAY View - is a service to receive, view and pay your bills online.
•   Pay Anyone - transfer funds to any account with any Australian financial institution.
•   Telegraphic Transfers – Domestic and overseas funds transfers in Australian & foreign currencies.
•   Transaction History - an online list of your transactions with a convenient search option.
•   Transaction Download – download a file of transactions to your computer and import it into a number of popular accounting package formats
•   Order a Statement - order a copy of a previous statement.
•   Order a Cheque Book - you can choose to collect your cheque book from a branch or have it mailed to you.
•   Secure Email - contact us confidentially online for requests and advice.
•   Account Notifications - you set a $ amount on your account and we notify you if your balance falls below or rises above this level.
•   Online advice - need help or advice? Email one of our friendly staff by clicking here, or by using your Secure Email.
Business e-banking
Businesses large and small will appreciate Bendigo Bank's additional business e-banking facilities.
•   24 hours a day, 7 days a week - the convenience of doing your business banking wherever you want, whenever you want, on any Internet connected computer.
•   Multiple Signatories - an authorisation system that allows a number of persons to authorise a payment at the touch of a button. No more office run-around.
•   Bill Payment - of all your bills which display the BPAY logo.
•   BPAY View - is a service to receive, view and pay your bills online.
•   Pay Anyone - because funds can be transferred to any account at any Australian financial institution, you can pay creditors direct.
•   Telegraphic Transfers – Domestic and overseas funds transfers in Australian & foreign currencies.
•   Bulk Payments - manage a small payroll with funds transfer to any financial institution.
•   One System - an all-in-one banking system that combines your personal and business e-banking on the one screen.
•   Funds Transfer - transfer funds between your Bendigo Bank accounts.
•   Online advice - need help or advice? Email one of our friendly staff by clicking here, or by using your Secure Email






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(b) What is public key encryption? In what way is it different from private key encryption? Why is it important in E-Commerce


public-key encryption
A cryptographic system that uses two keys -- a public key known to everyone and a private or secret key known only to the recipient of the message. When John wants to send a secure message to Jane, he uses Jane's public key to encrypt the message. Jane then uses her private key to decrypt it.
An important element to the public key system is that the public and private keys are related in such a way that only the public key can be used to encrypt messages and only the corresponding private key can be used to decrypt them. Moreover, it is virtually impossible to deduce the private key if you know the public key.
Public-key systems, such as Pretty Good Privacy (PGP), are becoming popular for transmitting information via the Internet. They are extremely secure and relatively simple to use. The only difficulty with public-key systems is that you need to know the recipient's public key to encrypt a message for him or her. What's needed, therefore, is a global registry of public keys, which is one of the promises of the new LDAP technology.
Public key cryptography was invented in 1976 by Whitfield Diffie and Martin Hellman. For this reason, it is sometime called Diffie-Hellman encryption. It is also called asymmetric encryption because it uses two keys instead of one key (symmetric encryption).
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a private or secret key is an encryption/decryption key known only to the party or parties that exchange secret messages. In traditional secret key cryptography, a key would be shared by the communicators so that each could encrypt and decrypt messages. The risk in this system is that if either party loses the key or it is stolen, the system is broken. A more recent alternative is to use a combination of public and private keys. In this system, a public keyis used together with a private key..
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Public and Private Key Encryption Systems
Private and public keys are used in two main encryption systems: Symmetric and Asymmetric.
Symmetric Encryption
This system uses only private keys. This requires the private key (code) to be installed on specific computers that will be used for exchanging messages between certain users. The system works pretty much like two best friends using a decoder ring to send secret messages to each other. Both friends know which code they are using and thus, only they will have the key to crack and encode secret messages.
Asymmetric Encryption
The Asymmetric Encryption system uses both the private and public keys. The private key is for yourself and the public key is published on line for others to see.
They use the public key to access the encryption code that corresponds to your private key. So, if you are sending an encrypted message to Susan which you do not want others to see, you would use her public key to encrypt it. She will be able to decrypt it with her own corresponding private key. Likewise, if she sends a message to you, she uses your public key to encrypt the message and you would use your private key to decrypt it.
Digital IDs are ideal because they can't be easily forged. They allow for a more electronically secured communication line because they enable you to make use of these encryption systems. By applying them to your PDF files, you are ensure their security.
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