ERP and E-Commerce
Over the last few years, e-commerce has become a common activity for many companies. Some of them dived into this challenge without taking into account the cultural changes that the situation involved, as well as the infrastructure necessary to continue with the initial project.
In order to begin to develop a Business in the electronic jungle, there are some points that need to be covered. It is necessary to establish a marketing strategy , to create a catalogue of products, define the costs and the sale prices, the target market, and shipping and handling.
Nowadays, most enterprises are willing to incorporate the development of e-Business. This new technology, which is based on the net, has arrived and will stay for a long time. But to set it up properly, it is necessary to rely on the good organization of the information and the processes. It is a challenge due to the fact that most companies do not have their own systems department to give support to solve their particular needs.
All the main departments of the companies are affected also, since there is a specific need of strategies and solutions that should be updated. Besides, it is relevant to have in mind the mission and vision of the enterprise and have an effective communication system for the strategic points. In order to visualize a proper development of this project, the same has to be accompanied by trained staff.
Starting the Development
The first step to follow is to select an Internet service provider. While it could be possible to use a solution or your own development, it would need to cover the basic needs of a catalogue of products, shopping carts, methods of payment with secure transactions, as well as order processing. There are two factors that will directly influence your work, therefore, it is very important that you should have a reliable hosting provider and reliable means of distribution.
Once these issues are decided, the location of the virtual shop would be the next step to bear in mind, and one of the options would be to go to a specific offer for the hosting of virtual shops.
It is essential to take into consideration the security part inside the shop and the transactions. There are two security standards designed especially for e-commerce: Secure Socket Layer (SSL) and Secure Electronic Transaction (SET).
The first one does not allow a third party to decode the document, through which it uses random keys, with a certification and a digital signature that has the specific function to guarantee that only the concerned user will be able to decode the message.
At the same time, SET is a security payment standard based on advanced encryption techniques in order to develop Internet transactions. It works with public and private keys protected by SSL, and it is designed to encrypt the transactions to a avoid indiscreet interference.
In regards to the necessary time to set up these applications, there is a huge offer in market. However, all the equipment like servers, routers, switches,… could be acquired directly with the manufacturer, or through an ISP or ASP.
The ASP has lately become indispensable for integrating the e-commerce, since they cover all the Business software including the sale and renting of equipment, links and web hosting among others.
The size of the developing Business is not important, for it would always need the guidance of an expert in the area, and depending on the place where it is based, this could mean selecting a more convenient service to hire in that location.
The IT executives of general industry with experience and implementation of ERP are now discovering the new rules of Business, and they are increasing demand for their clients due to this factor.
The users of Enterprise Resource Planning have improved their operations through the unification of the production systems and administration with other information technologies, and are now expanding this tools to their chain of supply for their clients.
The Benefits of ERP in E-Commerce
The solutions for electronic commerce are moved like the beats of the heart of Business strategies. Therefore, it is common for companies look for a proper way to firmly integrate their e-commerce engine with their transactional applications, but with dozens of ERP and Business application systems on the market, it is a waste of time to integrate a commerce engine to these systems.
The electronic commerce gives the possibility of facing the storage in real time in order to reach clients through the web. It combines the product information with the multimedia information, and manages the sales process from the beginning to the end, taking into account the orders and helping the enterprise to adapt its offer to the specific needs of the individual Business associates.
To describe the processes that involve the integration of ERP systems and electronic commerce, it could be described as the flow of operations that take part in the marketing between two companies. Initially, the availability of products are displayed in a catalogue, and the shipping orders made online are under subjection to the prices defined for the selected articles.
The conditions of the prices stipulated will be for the different clients. At the same time, the integrated systems could indicate online the availability and dates of delivery of the purchase.
The storage of information resulted from the purchase of products, and payment transactions are saved in databases of the trader. They could be emitted and supported in magnetic media or printed files. It could also exist as an interactive exchange of information if the companies involved in the purchasing use systems like SAP R/3.
For example, a company using that system can mark the clients that also use the same system with the objective of registering the online purchase orders. This transaction creates a document automatically in a system, and a sale order in the providers system, which reduces the quantity of details that both companies should enter, and reduces the risk of incorrect detail entry with the opportunity to reduce the costs of communication.
The marketing of products on a large scale is also benefited by the integration, since the catalogues of products are available in several languages. Currencies are seen by the whole world without having to be near the place of origin of the article, with no extra cost. Additionally, the publicity and marketing costs of the products are reduced.
E-Business, or Electronic Business is the new proposal for speeding up and improving the efficiency of the Business. Most clients are ready to receive better service than they were offered in the past. The experts state that taking an enterprise to the next level of ERP (to E-Business) will require not only the implementation in the intern systems, but also working with the associates in the chain of supply which is dealing with the flow via the Internet.
A new rule is becoming law for manufactures: an integrated chain of supply is the only way to absorb the demand of products.
The optimization of the operations will certainly reduce the costs of processing, administration and transport, and this is what leads to a new competitive advantage. Finally, the orientation of the implantation of these systems should be directed to the optimization of the companies’ operations, focusing on the premise to satisfy the clients’ needs.
The traditional concept of the modern enterprise is changing from a collection of internal functions to an integration of the relationship with clients and providers. With ERP systems, the companies have the ability to transcend the functional limits through the definition of their own Business processes.
However, the new developments based in e-Business models and electronic commerce have forced the companies to look for processes to allow the communication between themselves. The companies have showed an important interest in the alternatives, and this gives commercial profits in the administration of the supply chain, the electronic commerce and the automation of the salesforce, which has lead to the use of e-Business to reach the competitiveness in the market.
ERP systems like SAP R/3, People Soft, and J.D. Edwards offer e-Business solutions using tools like Web site developing, Intranet, and back-office sales. For that, they have selected software that includes Java, JSP, PHP, ASP, and HTML. In the particular case of SAP R/3, it also uses tools ITS (Internet Transaction Sever), which represents the link between the SAP R/3 system and the Web.
BAPIs (Business Application Programming Interfaces) allows clients and third party software vendors to integrate their components with SAP R/3; – IACs (Internet Application Components) provides the logical Business design of the web site and RFCs (Remote Function Calls). The interface series is implanted like libraries, which allows for the communication with other software programs.
Those solutions are integrated into the processes of customer service and operations management such as: materials, finances, human resources, distribution and sales. The unification of different functions could greatly benefit the manufacturing sectors, services companies, public and financial sectors.