Chapter 12 Building E-Commerce Applications and Infrastructure

1
Chapter 12Building E-Commerce Applications and
Infrastructure
2
Learning Objectives

• Describe the landscape and framework of EC
  application development
• Describe the major EC applications and list their
  major functionalities
• Describe the EC architecture development process
• List the EC application development options and
  the approaches for option selection

3
Learning Objectives (cont.)

• Describe the major activities in system analysis
  and design
• Describe the role of application service
  providers (ASPs)
• Describe catalogs, Web servers, carts, chatting,
  and telephony for EC

4
Learning Objectives (cont.)

• Understand the issue of connecting EC
  applications to databases, other applications and
  networks, and to business partners
• Describe site usability and management
• Describe the process of storefront development
• Build a simple storefront using templates

5
Basic Understand

• There is a large variety of EC applications
• EC applications keep changing over time
• There are several options for developing EC
  application
• Building a complex applications from components
  is a viable strategy
• One EC application may have many component from
  several different vendors
• EC application may involve several business
  partners, including consultants
• The web sites and application can be developed
  in-house, outsourced or a combination of the two

6
EC Application Development Process
7
Landscape and Framework of EC Application
Development

• Development process
• Step 1 EC architecture creation--systems
  analysis approach
• Step 2 Select a development option
• Step 3 Installing, connecting, and more
• Step 4 Deployment
• Step 5 Operation and maintenance

8
Landscape and Framework of EC Application
Development (cont.)

• Project management
• Development process is complex and must be
  properly managed
• Team formed to manage the process and vendors
• Collaborations with business partners is critical
• Appropriate management includes periodic
  evaluations of system performance

9
Major EC Application

• Storefronts (Sell-side)
• E-procurement (Buy-side)
• Auctions
• Enterprise portal

10
Major EC Functionalities

• A storefrontbuilt on sellers server
• B2C storefronts The Buyer needs
• Discover, search and compare products
• Select product ad negotiate price
• Aid in evaluation of products and services
• Payment of purchase and order processing
• The seller needs
• Order confirmation
• Guest book for comments and contacts
• Credit verification system
• Arrange delivery (tracking)

11
Major EC functioalities

• The Seller needs (cont.)
• View a personalized page with a record of past
  purchase
• Verify that the product has been shipped using a
  tracking system
• Request postsale support or feedback
• View all lists in a secure user-friendly
• Provide content update
• Connect to inventory management module

12
Storefront subsystems

• Research from DeWire, 1998 proposed that EC must
  containt at least
• A merchant system (storefront) that provides the
  merchants catalog with
• Products
• Prices
• Promotion
• A transaction system for processing orders,
  payments and other aspects of the transaction
• A payment gateway that route payment through
  existing financial system(for credit card and
  settlement)

• Include shopping cart

13
Major EC Applicationsand Their Functionalities
(cont.)

• A storefrontbuilt on sellers server
• Suppliers sell-side in B2B
• Personalized catalogs
• B2B payment gate
• Electronic contract negotiation
• Product configuration
• Ability to use m-commerce
• Affiliate program capabilities
• Integration with corporate back-end systems

14
Major EC Applicationsand Their Functionalities
(cont.)

• E-procurement and reverse auctions
• Reverse auction (tendering system)
• Catalog of items to be tendered and content
  management
• Search engine
• Personalized pages for potential large bidder
• Reverse auction mechanism or real-time
• Facility to help for providing RFQs
• Collaboration with trading partners
• Standardization RFQs
• Automatic business process workflow
• Automatic matching of suppliers with RFQs
• Automated language translation
• Ability for bidding via m-commerce

15
Catalog requirements for e-procurement

• Search engine
• Comparison engine for alternative vendors
• Ordering mechanism
• Budget and authorization feature
• Usage comparison (among various department)
• Payment mechanism

16
Major EC Applicationsand Their Functionalities
(cont.)

• Enterprise portals

• Personalized pages
• Security and privacy protection
• Integration capabilities
• Searching and indexing
• Modularity

• Performance caching
• Openness
• Polls and evaluations
• E-mail service
• Servers

17
Major EC Applicationsand Their Functionalities
(cont.)

• Exchanges

• Collaboration services
• Community services
• Web-automated workflow
• Integrated business process solutions
• Data mining
• Transaction flow

• Language translation
• Central coordination of global logistics
• Integration services
• Negotiation mechanisms
• Comprehensive links

18
Developing an EC Architecture

• The 6 steps of development are (Koontz 2000)
• Step 1 Define business goals and vision
• Step 2 Define the information architecture
• Indentify the information available on each goal
• Which information need to be digitized
• Use a tool eg. DNA (Microsofts distributed
  internet architecture)
• Step 3 Define data architecture
• What data and information needed to get from
  customers
• Investigate all information that flows among the
  businesses

19
Developing an EC Architecture

• The 6 steps of development are (Koontz 2000)
• Step 4 Define your application architecture
• Define the components that meet the data
  requirements from step 3
• To interface with legacy systems eg. ERP
• Step 5 Define the EC technical architecture
• Examine the specific hardware and software to
  support the analysis in the previous step
• Examine the middleware, language needed
• Step 6 Define the organization architecture
• Human resources and procedures required

20
Development Strategies forEC Applications

• Buy the applications (turnkey approach)

• Disadvantages
• Software doesnt exactly fit needs
• Loss of control over improvements and versions
• Difficult to integrate
• Vendors may drop product or go out of business

• Advantages
• Availability of many off-the-shelf packages
• Saves time
• Requires few dedicated personnel
• Not the first and only user

21
Development Strategies forEC Applications (cont.)

• Lease
• Types of leasing vendors
• Lease the application from an outsourcer and
  install it on company premises
• Use an application system provider (ASP)
• In-house development insourcing
• Development approaches
• Build from scratch
• Build from components
• Prototyping methodology

22
Development Strategies forEC Applications (cont.)

• Other development options
• Join an e-marketplace or exchange
• Join a third-party or reverse auction
• Joint ventures
• Join a consortia
• Hybrid approach

23
Outsourcing and Applications Service Providers

• Outsourcing For a small company with a few IT
  staff and smaller budget using outside contractor
• Internet malls common look-and-feel mall
• ISPs hosting, secure transaction
• Telecommunication companies hosting
• Software houses from IBM-gtariba (agent)
• Outsourcers and others eg. EDS, EC services

24
Applications Service Providers

• ASP agent/vendor who assembles the functions
  needed by enterprises and packages them with
  outsourced development, operation, maintenance
  and other services (Kern and Kreijger,2001)
• Benefits to the ASP vendor
• Companies generate revenues from sources other
  than connectivity and transport
• Lucrative Web site hosting
• Web design consulting
• Hosted applications with access charges

25
Applications Service Providers (cont.)

• Benefits to the leasing companies
• Saves time and various expenses in the initial
  development stage (i.e., labor costs)
• Reduces software maintenance, upgrading
  applications, and training time
• Reduces time-to-market
• Enhances ability to adapt to changing market
  conditions
• disadv. Protection, theft of confidential
  information, virus

26
Benefits and Risks of Using an ASP
27
Criteria for Selecting a Development Approach

• Criteria

• Functionalities of development packages and
  criteria of choice
• Information requirements
• User friendliness
• Hardware and software resources
• Installation
• Maintenance services

• Security
• Vendor quality and track record
• Estimating costs
• Measuring benefits
• Personnel
• Forecasting and planning for technology evolution

28
Criteria for Selecting a Development Approach
(cont.)

• Criteria (cont.)

• For ASP vendor
• Database format and portability
• Application and data storage
• Scope of service
• Support services
• Integration ERP, CRM, SCM, accounting

• Scaling
• Sizing
• Performance
• Latency time(time to complete the task)
• throughput
• Reliability
• Security

29
System Analysis Activities and Tools

• Requirements analysis
• Methods for determining requirements
• Joint Application Development (JAD) by key
  users, managers, EC users, business partners via
  brainstorming-gtprototype
• Modeling approaches may be based on
• Activity/process
• Use case/object-oriented
• Interprocess

30
System Analysis Activitiesand Tools (cont.)

• Component-based development
• Components evolved from objects of
  object-oriented methodology
• They are much larger than objects and now serve
  as plug-and-play building blocks for developing
  large complex systems
• Reasons for using components
• Code reusability
• Support for heterogeneous infrastructures and
  platforms
• Rapid assembly of new business applications

31
Components defined

• Component is an executable unit of code that
  provides physical black-box encapsulation of
  related services or functions which can be
  accessed only through a consistent, published
  interface that includes an interaction standard.
  A component must be capable of being connected to
  other components to form an application (Allen
  and Frost, 1998)
• E.g. user interface icon, a GUI, online ordering
  tool(business component), Intranet component
  includes search engines, firewall, web server,
  browser and telecommunication protocol.

32
Using components
Business Process Improvement
Access business needs
Provide solution From services
Using components
Legacy system
Package Interface
Database
33
System Analysis Activitiesand Tools (cont.)

• Enterprise application integration
• Aims to integrate applications (including
  internal applications) that have been developed
  by different organizations
• If source code is unavailable (altering the
  application is not possible), EAI becomes the
  glue between the applications

34
Levels of Enterprise Integration
35
Basic of Integration
Presentation
Presentation
Common Presentation
Application Logic
Application Logic
Presentation
Presentation
Middleware
Middleware
Legacy application
Packaged application
Legacy application
Packaged application
Legacy application
Packaged application
Data
Data
Data
Data
Data
Data
Presentation Integration model
Data Integration model
Function Integration model
36
Electronic Catalogs, Shopping Carts

• Electronic catalogs, shopping carts, and merchant
  servers
• Templates or wizards for creating storefronts and
  catalog pages
• E-shopping carts
• Web-based order forms
• Database for maintaining product descriptions,
  etc.
• Integration with 3rd party softwaretaxes,
  shipping, etc.
• Electronic payment systems

37
Web Chatting, Webcasting,and Internet Telephony

• Webcastinginternet based broadcasting
• Text streams
• Ambient Webcasts clips transmitted at periodic
  interval
• Streaming audio
• Internet telephony
• Pc-to-pc
• Pc-to-phone
• Phone-to-phone

• Web chatting
• Communication centers
• Customer service
• Community discussion
• Video chat

38
EC Suites

• Suitecombined set of tools giving builder and
  users
• Greater flexibility
• Specialization
• Customization
• Integration
• Support for complete functionality

39
Open Market EC Server Architecture
Source Interworld,com/solutions
40
Commerce Suite
POS Marketplace
CAM
Content
Customer Service
Product Merchandising
Business Intelligent
information
Transaction
Fulfillment
Order management
SCM,MRP Warehousing
ERP
workflow
From interworld.com
41
EC Suites

• IBM WebSphere Commerce Suite
• Web server for catalog management
• Application server for security
• Reverse auctions
• Exchanges
• Contracts
• EC suite server sell-side ordering and auctions
• Database server
• HTTP interface

42
IBM WebSphere Commerce Suite

• Delivers an open, standards-based solution
  platform with integrated components for building
  e-marketplace
• Facilitates operational efficiency and high
  return on investment
• Uses Java and XML technologies to aggregate
  sellers catalogs
• Provides optimal customization and flexibility
• Incorporates e-marketplace functionality

43
Connecting to Databases, Legacy Systems, and
Business Partners

• Connecting to business partners
• Critical to success of EC, especially for B2B
  applications
• Issues to be dealt with
• Connectivity
• Compatibility
• Security
• Scalability

Critical!
44
Web to Database Connection
45
Integration example

• Build N-Tier,multitier, C/S application
• Browser tier presentation of information
• Application server tier execution of business
  rules
• Database server tier Companys data
• BEA, Inc. used JDBC(Java Database Connectivity)
  and ODBC (Open Database Connectivity)
• TIBCO TIB(The Information Bus)
• Microsoft ASP (Active Server Pages) use ODBC
  connect to variety of databases

46
Vendor and Software Selection

• Steps in selecting software package (Martin et
  al, 2000)
• 1 Identification of suitable packages
• 2 Determination of detailed evaluation criteria
• 3 Evaluation of candidate packages
• 4 Choosing a package
• 5 Negotiating the contract

47
Vendor and Software Selection (cont.)

• Identification of suitable packages
• Sources of information about packages
• Hardware vendors
• User groups
• Technical and trade publications
• Consultants experienced with an application area
  or industry
• Friends and competitors
• Preliminary evaluation criteria to eliminate all
  but a few of the most promising packages

48
Vendor and Software Selection (cont.)

• Determination of evaluation criteria
• Must determine in detail what one must know about
  the packages and how important each criteria is
• Characteristics of the vendor
• Functional requirements of the system
• Technical requirements the software must satisfy
• Amount and quality of documentation provided
• Vendor support of package

49
Vendor and Software Selection (cont.)

• Determination of evaluation criteria (cont.)
• Requirements for purchase (RFP) is developed
  including
• Information about the vendor
• How long the vendor has been in the EC software
  business
• Number of employees, financial and location of
  its sales and support offices
• First release date of system being considered
• Date of last revision
• List of companies using the software to contact
  as references

50
Vendor and Software Selection (cont.)

• Determination of evaluation criteria (cont.)
• Project team develops essential functional
  requirements the systems must satisfy (RFP)
• Mandatory requirements
• Desired features
• Stated as questions about the characterizes of
  the package
• Ease with which software can be tailored to fit
  companys current needs or enhanced in the future

51
Vendor and Software Selection (cont.)

• Evaluation of candidate packages
• RFP is sent to short list of qualified vendors
• Responses generate massive volumes of information
  for evaluation to determine
• Gaps between the companys needs
• Capabilities of the proposed application packages
• To help determine which package, may use a table
  (see Table 12-2)

52
Vendor and Software Selection (cont.)
Criteria Weights System A System B System C
Support for Java standards
XML
SSL
Shoppingcart
Catalogs
Taxation
Personalization

53
Vendor and Software Selection (cont.)

• Choosing the package once the short list has been
  prepared
• Determine how the packages might be modified to
  remove any discrepancies with the companys
  desired EC application
• Most important factor is additional development
  effort required to tailor the system
• To companys needs
• To integrate with companys environment

54
Vendor and Software Selection (cont.)

• Choosing the package (cont.)
• People are likely to have to adapt to the
  software
• Significant changes in how they do their jobs
• Commitment is necessary for the system to succeed
• Project team should verify that
• Users of the system support the decision to buy
  the selected package and agree to make it work
• IS people who will support the system agree that
  the system will work in their environment and
  that they can support is satisfactorily

55
Vendor and Software Selection (cont.)

• Contract negotiation (EC managers and/or IS
  department)
• Specifies the price of the software
• Determines the type and amount of support to be
  provided
• Integral part of purchase process
• Companys power is in being able to choose
  another vendors product
• Concessions from vendor must be negotiated before
  final decision on which package to buy

56
Vendor and Software Selection (cont.)

• Service level agreements (SLAs)
• Formal agreements regarding the division of work
  between a company and its vendors
• SLA can achieve facilitation and coordination by
• Defining the partners responsibilities
• Providing a framework for designing support
  services
• Allowing the company to retain as much control as
  possible over their own system

57
Vendor and Software Selection (cont.)

• Service level agreements (SLAs) (cont.)
• Four steps for establishing SLA
• Defining levels
• Dividing computing responsibility at each level
• Designing the details of the service levels
• Implementing service levels

58
Site Management and Usage Analysis

• Implementation of evaluation devices
• Collecting and analyzing statistics
• Hits per pageview
• What can you get from pageviews
• Pageviews by time bucket (time slot)
• Pageviews by customer logging status
• Pageviews by referrer
• Pageviews by visitors hardware platform, OS,
  browser
• Pageviews by visitors host

59
Site Management andUsage Analysis (cont.)

• Usability the measure of quality of a users
  experience when interacting with a product or
  system
• Ease of learning
• Efficiency of use
• Memorability
• Error frequency and severity
• Subjective satisfaction

60
Site Management andUsage Analysis (cont.)

• E-commerce management tools
• Patrol for e-business management
• Measures Web response time
• Firewall administration
• Application servers
• Patrol for Microsoft
• Open market
• Netscape

61
Site Management andUsage Analysis (cont.)

• E-commerce management tools (cont.)
• MainView for e-business management
• Manages mainframe-based EC applications
• Monitors mainframe network connections
• Systems administration
• Service assurance center for e-businessmethodolog
  y, products, and services designed to optimize
  performance and availability of business
  applications

62
Process of Storefront Development

• Issues to be addressed before choosing the proper
  solution include
• Customers
• Merchandising(kind of products)
• Sales service
• Promotion
• Transaction processing
• Marketing data and analysis
• Branding

63
Process of Storefront Development (cont.)

• Design guidelines

• Establishing credibility
• Offering personalized service
• Pre- and post sales support
• Realistic pricing

• Availability and fast loading
• Simplicity of site structure
• Use of shopping cart
• Good navigation
• Globalization
• Maximizing ways to order and pay