internet and other technologies

94 SREERAM ACADEMY (FORMERLY SREERAM COACHING POINT)

INTERNET AND OTHER TECHNOLOGIES

Internet

Internet is the short form of International Network. It is an interconnection of numerous computers from

various parts of the world. Though it has a very short history almost 40% of the world population makes uses

of the benefits of Internet. No other mode of communication has in fact attracted man as fast as Internet.

The History of Internet

The Internet grew out of funding by the U.S. Advanced Research Projects (ARPA), later renamed as

Defense Research Projects Agency (DARPA), to develop a communication system among government

and academic computer- research laboratories. The first network component, ARPANET, became

operational in October 1969. With only 15 nongovernmental (university) sites included in ARPANET,

the US National Science Foundation decided to fund the construction and initial maintenance cost of a

supplementary network, the Computer science Network (CSNET).

Objectives of ARPANET:

The network should continue to work even if one or many of the computers or connections

in the network fail.

The network should be usable in different hardware/ software platforms.

The network had to automatically re-route the traffic around non functioning paths of

network.

The network has to be a network of networks and not network of computers.

In 1990, Tim burners- Lee and others at CERN (European organization for nuclear research) developed

a protocol based on hyper text to make information distribution easier. In 1991 this protocol enabled

the creation of the World Wide Web and its system links among user- created pages. A team of

programmers at the US national center for supercomputing applications, Urbana, Illinois developed a

program called a browser that made it easier to use the WWW, and a spin-off company named

Netscape Communications Corp. was founded to commercialize that technology.

Netscape was an enormous success. The web grew exponentially, doubling the number of users and

the number of sites every few months. URL became part of daily life and use of Email became common

place. Increasingly, business took advantage of the Internet and adopted new forms of buying and

selling in CYBERSPACE (Science fiction Author William Gibson popularized this term in the early

1980s). With Netscape so successful, Microsoft and other firms developed alternative web browsers.

Originally created as a closed network for researchers, the Internet was suddenly a new public medium

for information. It became the home of virtual shopping malls, bookstores, stock brokers, newspapers

and entertainment.

It soon became apparent that new software was necessary to take advantage of the opportunities

created by the Internet. Sun Microsystems, maker of powerful desktop computers known as

workstations, invented a new object oriented programming language called JAVA. Meeting the design

needs of embedded and networked devices, this new language was aimed at making it possible to

build applications that could be stored in different locations and moved to run in a single device.

JAVA is one of the more effective ways to develop software for smart cards, plastic debit cards with

embedded computer chips that could store and transfer electronic funds in place of cash.


IP addresses

Since computer processes numbers more efficiently and quickly than characters each machine directly

connected to the Internet is given an IP address.

An IP address is a 32- bit address comprised of four 8 bit numbers (28) separated by periods. Each of

the four numbers has a value between 0 and 255.

Example of an IP address: http://134.68.140.1/

IP addresses Vs URL

While numeric IP addresses work very well for computers, most humans find it difficult to remember

long patterns of numbers.

Instead, humans identify computers using UNIFORM RESOURCE LOCATOR a.k.a Web Addresses.

When a human types a URL into a browser, the request is sent to a DOMAIN NAME SERVER (DNS)

which then translates the URL to an IP address understood by computers.

The DNS acts like a phone book.

Anatomy of a URL

http:// www. cs. Iupui. Edu/ index. Html

Protocol machine name sub-sub domain sub domain domain name file name

How TCP/ IP work?

1. TCP breaks data into small pieces of number bigger than 1500 characters each. These pieces are

called packets.

2. Each packet is inserted into different IP Envelopes. Each contains the address of the intended

recipient and has the exact same header as all other envelopes.

10101101010

10010101010

10101010101

1010101

1010101 1010101

1100110

1

1100001

0101010


134.68.140.247 134.68.140.247 134.68.140.247

3. A router receives the packets and then determines the most efficient way to send the packets to the

recipient. After travelling along a series of routers, the packets arrive at their destination.

4. Upon arrival at their destination, TCP checks the data for corruption against the header included in each

packet.

If TCP finds a bad packet, it sends a request that packet be retransmitted.

Types of Internet servers

1. File Server: It manages requests from clients for files stored on the servers local disk. A central file

server permits groups and users to share and access data in multiple ways. Central file servers are

backed up regularly and administrators may implement disk space quotas for each user or group of

users.

2. Mail Server: Mail server is the most efficient way to receive and store electronic mail messages for a

community of users. A central mail server runs 24 hours a day. It provides a global mail directory for all

community and school users as well as e-mail gateway and relay services for all other mail servers in

the district.

3. Domain Name Service (DNS) server: It is an internet wide distributed database system that

documents and distributes network-specific information.

4. Gopher server: Gopher is an internet application that uses multiple gopher servers to locate images,

applications and files stored on various servers on the internet. Gopher offers menu choices to prompt

users for information that interests them, and then establishes the necessary network connections to

obtain the resource.

5. Web server: A web server serves static content to a web browser by loading a file from a disk and

serving it across the network to the users web browser. Web browsers present information to the

user in hypertext format.

6. File Transfer Protocol (FTP) server: It is an internet wide standard for distribution of files from one

computer to another. The two most common ways to transfer files are with anonymous FTP, where

anyone can retrieve files from or place files on a specific site and log file transfers, where an individual

must login into the FTP server with an ID and Password.

7. New server: This server acts as a distribution and delivery source for thousands of public news groups

currently accessible over the USENET news network. USENET is a worldwide bulletin board system that

can be accessed through the internet or many online services. USENET contains more than 1400

1010101

0101010

1

10101010

1010101

10101010

1010101


forums which is called newsgroup that cover every imaginable interest group. This is used by millions

of people around the globe daily.

8. Chat server: It enables a large number of internet users to exchange information in an environment

similar to internet newsgroups that offer real- time discussion capabilities. Real time means occurring

immediately. Operating system that respond to input immediately are real-time operating systems.

Most general purpose operating systems are not real- time because they take few seconds or even

minutes to react.

9. Caching server: A caching server sits between the client computer and the server that would normally

fulfill a clients request. Once the clients request is sent, it is intercepted by the caching server. The

caching server maintains a library of information requested from internet in recent past by users on

the network. If the same is desired again by any user, it is provided from the caching server rather than

going to internet again. In this way, the overall traffic to and from the internet is reduced.

10. Proxy server: A proxy server is designed to restrict access to information on the internet. It operates on

a list of specific forbidden sites, while other proxy software examines the content of a page before it is

served to the requester. If certain keywords are found in the requested page, access to it is denied by

the proxy server.

World Wide Web (WWW)

WWW is a global hypertext system, which uses the Internet as its transport mechanism. It can be defined as

collection of all the web pages all over the globe. It is a component of the internet that provides access to large

amount of information and many services available on the internet.

WWW is a hyper text system, which means that a web page contains hyper links which allows the user to

navigate by clicking the hyperlinks, which displays another document containing another hyperlink. The web

document or web page which is a text document contains links to other web pages, graphic, audio files and

other Internet services. These web pages are created using Hypertext Markup Language (HTML).

Internet surfing refers to hopping from one computer to another computer for search of information. A server

on the internet provides information, specializing on a topic or subject, which is required by users. User may be

looking for such information and for that he goes to many servers until the desired information is reached.

WWW links the computers on the internet, like a spider web facilitating users to go from one computer to

another directly. This search from one computer to another is called surfing or internet surfing.

Tools available to protect information in network against intrusion / misuse

1. Firewall :

Firewalls are system which control the flow of traffic between the Internet and the firms

internal LANs and systems.

They are packaged as turnkey hardware/ software packages and are set up to enforce the

specified security policies that are desired.

A firewall is a person and effect means of protecting the firms internal resources from

unwanted intrusion.

2. Encryption: Encryption allows information to transmit to the internet while being protected from

interpretation by eavesdroppers. The two approaches to encryption are:-


a. Hardware encryption devices: If the internet is being used to exchange information among branch

offices for instance, use of hardware encryption can ensure that all traffic between these offices is

secure.

b. Software Encryption devices: It is employed in conjunction with specific application. For example,

certain electronic mail packages provide the facility of encryption and decryption for message

security.

3. Message authentication:

a. Message authentication ensures that message is really from whom it purports to be and

that it has not been tampered with.

b. Clearly defined internet security policies and procedures should always be part of any

corporate internet security strategy.

4. Site Blocking:

a. Site blocking is a software based approach which prohibits access to certain websites that are

deemed inappropriate by management.

In addition to blocking sites, companies can also log activities and determine the amount of time spent on the

internet and identifies the sites visited.

Internet and Intranet

Basis Internet Intranet

Reach Internet is a global network of interconnected computer networks formed by various educational, commercial, governmental, and non- profit and military organizations.

Intranet is a network of computers within an organization. It facilitates communication within the organization, among widely spread departments, divisions and regional locations.

Ownership These networks are individually owned and operated that are all interconnected.

Networks owned by organizations of companies.

Databases There are thousands of databases containing information of all sorts in addition to facilities like e-mail, chatting, games, message boards and free software.

There are only few databases and that too only for business use and applications.

Browsers used Access to information on internet can be through various browsers like Netscape navigator, Internet explorers, etc.

Access to information on the Intranet can be through only one or same browser.

Users Internet used for business, educational, governmental, military, personal purposes.

Intranet used only for business purposes, like supplier management, inventory distribution and channel management.


Extranet: An extranet is an extension of an Intranet that makes the later accessible to outside companies or

individuals with or without an intranet. It is also defined as collaborative made available to customers, or

business partners or specific applications. The Extranet is thus an extended Intranet, which isolates business

communication from the Internet through secure solution. Extranet provides the privacy and security of an

Intranet while retaining the global reach of the Internet. An Extranet extends the Intranet from one location to

another across the Internet by securing data flows using cryptography and authorization procedures, to

another Intranet of a business partner.

Groupware

It is the name given to software used in a group DSS, in which several people jointly solve a problem. Such

internet service vendors as Netware and such Groupware vendors as IBM/ Lotus are adding features to their

products that are aimed at using the Net for collaborative problem solving.

Types of Internet Connection

1. Analog (up to 56k): Also called dial-up access, it is both economical and slow. Using a modem connected to

your PC, users connect to the Internet when the computer dials a phone number (which is provided by your ISP) and connects to the network.

Dial-up is an analog connection because data is sent over an analog, public telephone network. The modem converts received analog data to digital and vice versa. Because dial-up access uses normal telephone lines the quality of the connection is not always good and data rates are limited.

Typical Dial-up connection speeds range from 2400 bps to 56 Kbps. 2. ISDN:

Integrated services digital network (ISDN) is an international communications standard for sending voice, video, and data over digital telephone lines or normal telephone wires.

Typical ISDN speeds range from 64 Kbps to 128 Kbps.

3. B-ISDN: Broadband ISDN is similar in function to ISDN but it transfers data over fiber optic

telephone lines, not normal telephone wires.


SONET is the physical transport backbone of B-ISDN. Broadband ISDN has not been widely implemented.

4. DSL: DSL is also called an always on connection because it uses existing 2-wire copper

telephone line connected to the premise and will not tie up your phone as a dial-up connection does.

There is no need to dial-in to your ISP as DSL is always on. The two main categories of DSL for home subscribers are called ADSL and SDSL.

5. ADSL: ADSL is the most commonly deployed types of DSL in North America. Short for

asymmetric digital subscriber line ADSL supports data rates of from 1.5 to 9 Mbps when receiving data (known as the downstream rate) and from 16 to 640 Kbps when sending data (known as the upstream rate).

ADSL requires a special ADSL modem. 6. ADSL+2:

ADSL+2A is an extension to ADSL broadband technology that provides subscribers with significantly faster download speeds when compared to traditional ADSL connections.

ADSL+2 works in the same fashion as ADSL a special filter is installed on a subscriber's telephone line to split existing copper telephone lines (POTS) between regular telephone (voice) and ADSL+2.

ADSL2+ service is most commonly offered in highly-populated metropolitan areas and subscribers must be in close geographical locations to the provider's central office to receive ADSL2+ service.

7. SDSL: SDSL is still more common in Europe. Short for symmetric digital subscriber line, a

technology that allows more data to be sent over existing copper telephone lines (POTS).

SDSL supports data rates up to 3 Mbps. SDSL works by sending digital pulses in the high-frequency area of telephone wires and cannot operate simultaneously with voice connections over the same wires. SDSL requires a special SDSL modem.

SDSL is called symmetric because it supports the same data rates for upstream and downstream traffic.

8. VDSL: Very High DSL (VDSL) is a DSL technology that offers fast data rates over relatively

short distances the shorter the distance, the faster the connection rate. All types of DSL technologies are collectively referred to as xDSL. xDSL connection speeds range from 128 Kbps to 8 Mbps.

9. Cable: Through the use of a cable modem you can have a broadband Internet connection that

is designed to operate over cable TV lines. Cable Internet works by using TV channel space for data transmission, with certain

channels used for downstream transmission, and other channels for upstream transmission. Because the coaxial cable used by cable TV provides much greater bandwidth than telephone lines, a cable modem can be used to achieve extremely fast access.

Cable speeds range from 512 Kbps to 20 Mbps.


10. Wireless Internet Connections: Wireless Internet or wireless broadband is one of the newest Internet connection

types. Instead of using telephone or cable networks for your Internet connection, you use radio frequency bands.

Wireless Internet provides an always-on connection which can be accessed from anywhere as long as you geographically within a network coverage area.

Wireless access is still considered to be relatively new, and it may be difficult to find a wireless service provider in some areas. It is typically more expensive and mainly available in metropolitan areas.

11. T-1 Lines: T-1 lines are a popular leased line option for businesses connecting to the Internet and

for Internet Service Providers (ISPs) connecting to the Internet backbone. It is a dedicated phone connection supporting data rates of 1.544Mbps.

A T-1 line actually consists of 24 individual channels, each of which supports 64Kbits per second. Each 64Kbit/second channel can be configured to carry voice or data traffic.

Most telephone companies allow you to buy just one or some of these individual channels. This is known as as fractional T-1 access.

12. Bonded T-1: A bonded T-1 is two or more T-1 lines that have been joined (bonded) together to

increase bandwidth. Where a single T-1 provides approximately 1.5Mbps, two bonded T1s provide 3Mbps

or 46 channels for voice or data. Two bonded T-1s allow you to use the full bandwidth of 3Mbps where two individual T-1s can still only use a maximum of 1.5Mbps at one time.

To be bonded the T-1 must run into the same router at the end, meaning they must run to the same ISP.

T-1 Lines support speeds of 1.544 Mbps Fractional T-1 speeds are 64 Kbps per channel (up to 1.544 Mbps), depending on

number of leased channels. Typical Bonded T-1 (two bonded T-1 lines) speed is around 3 Mbps.

13. T-3 Lines: T-3 lines are dedicated phone connections supporting data rates of about 43 to 45

Mbps. It too is a popular leased line option. A T-3 line actually consists of 672 individual channels, each of which supports 64 Kbps T-3 lines are used mainly by Internet Service Providers (ISPs) connecting to the Internet

backbone and for the backbone itself. Typical T-3 supports speeds ranging from 43 to 45 Mbps.

14. OC3: Short for Optical Carrier, level 3 it is used to specify the speed of fiber optic networks

conforming to the SONET standard. OC3 is typically used as a fiber optic backbone for large networks with large voice,

data, video, and traffic needs. Speeds are 155.52 Mbps, or roughly the speed of 100 T1 lines.


15. Satellite: Internet over Satellite (IoS) allows a user to access the Internet via a satellite that

orbits the earth. A satellite is placed at a static point above the earth's surface, in a fixed position.

Because of the enormous distances signals must travel from the earth up to the satellite and back again, IoS is slightly slower than high-speed terrestrial connections over copper or fiber optic cables.

Typical Internet over Satellite connection speeds (standard IP services) average around 492 up to 512 Kbps.

Uses of Internet

1. Online interactive communication- It is the major facilitator for any business. Business needs a lot of

interaction internally among their executives and externally with business associates. When many

persons have to contribute to discussions. This is normally achieved by arranging meetings and

conferences for which people travel from different locations to meet at one place. This many to many

communications can be handled on the internet quite effectively without any difficulty. At pre-defined

timing those have to communicate together can be online through internet and have electronic

conferences.

2. Bulletin board- Through internet, many discussions can be done through a forum where people post

messages for each other and respond to them periodically. This is similar to having a bulletin board on

everyone posts messages.

3. Storehouse of information- It is a storehouse of information and is able to cater to a very wide range of

information needs. Through databases information can be made accessible to other users on the

internet. Users only have to search for information sites, qualify and retrieve useful information.

4. Information about products & services- Business can set up their own websites or home pages which

will facilitate information on their products and services available to others (e.g. their clients).When

the potential clients and others visit the site or the home pages they will have the option to send E-

mail immediately indicating their interests or queries.

i. A common location for information is an assembled manner on business and services.

ii. Information access at reasonable costs.

iii. Feedback mechanism for users.

iv. Information delivery costs internally and externally reduced.

v. Employees access to significant information enhanced.

vi. An efficient means of updating and discriminating current information to customers and

internal staffs is provided.

vii. Customized information to consumers is delivered.

E-Commerce

E-Commerce refers to the use of Internet for business to- business and business-to-customer transactions. It

is the process of doing business electronically. It automates business-to-business and business-to-consumer

transactions through reliable and secure connections.


E-Commerce is a composition of technologies, processes and business strategies that foster the instant

exchange of information within and between organizations. It is application of various technologies of

communication to provide the automated exchange of business information with internal and external

customers, suppliers and financial institutions.

Reasons for Internets dramatic impact on the scope of E-Commerce are:-

1. Universality Business to-Business interactions are possible using internet. Any business can interact

with any other business.

2. Reach- Internet has global reach i.e. to cities and towns throughout the modern and developing world.

3. Performance- the Internet provides its users with a high- function window to the world, in addition to

handling every day networking tasks such as electronic mail, visual images, audio clips, video clips and

other large electronic objects.

4. Reliability- Internet technology is highly robust, reliable and secure way of communication.

5. Cost- Internet costs are lower than other alternative electronic networking technologies.

6. Momentum- Millions of people are already connected to the internet and business of it is increasing at

a dramatic rate.

Working of E-Commerce

Following is a step by step online transaction processing in an e-commerce environment:

1. Order placed: Customer places order through secure connection on website, or merchant manually

keys in transactions.

2. Authorization request: Payment gateway receives the transaction through the secure internet

connection, encrypts it, and submits an authorization to the credit card issuing bank.

3. Authorization response: Credit card issuing bank either approves or declines the request and sends a

response back through the payment gateway to the website.

4. Order fulfilled: Once approved the merchant processes and ships the customers order.

5. Settlement request: The payment gateway sends a settlement request to the merchant account

provider each day that transactions are processed

6. Settlement deposited: The merchant account provider deposits the amount for each settlement into

the merchants bank account. Usually takes 24- 48 hours.


Benefits of E-Commerce

1. Reduced costs: Due to increased competition between suppliers who compete in an electronically

open market place, the costs to buyers have reduced. Even suppliers can electronically access on-line

databases of bid opportunities, on-line abilities to submit bids, and on-line review of rewards, thereby

reducing their costs.

2. Reduced time for business transactions: There is a reduction in time to complete a business

transaction, particularly from delivery to payment.

3. New Markets: It creates new markets through the ability to easily and cheaply reach the potential

customers.

4. Errors and Overhead costs: Reduced errors, time and overhead costs in information processing by

eliminating requirements for re-entering data.

5. Entry to New markets: There is an easier entry to new markets especially geographically remote

markets, for companies of all sizes and locations.

6. Inventory control: There is reduced inventories and reduction of risk of obsolete inventories as the

demand for goods are electronically linked through just-in-time inventory and integrated

manufacturing techniques, hence providing better control over inventory.

7. Overhead costs: Reduction in overhead costs through uniform automation and large scale integration

of management process. There is also a reduction in advertising costs.

8. Delivery, Design and Manufacturing costs: Reduction in delivery cost especially of goods that can be

electronically delivered and also a reduction in design and manufacturing costs.

9. Global Programs: Companies are able to undertake major global programs in which the cost and

personnel needed to manage a non-automated system would be unreasonable or prohibitive.

10. Access: Use of public network- based infrastructure can level the playing field for both small and large

companies. This allows companies of all sizes to extend their reaction to a broad customer sector.

The benefits of corporate wide implementation of E-Commerce are many but with benefits also come

risks. Therefore, the companies should not leap blindly into E-commerce, but rather first develop an E-

Commerce strategy and then organize a corporate wide team to implement such strategy to gain the

best of results.

Types of E-Commerce

There are four general classes of e-commerce applications:

a. Business to-Business (B2B): Short for business-to-business, the exchange of services,

information and/or products from one business to another, as opposed to between a

business and a consumer

b. Business to-Consumer (B2C): Short for business-to-consumer, the exchange of services,

information and/or products from a business to a consumer, as opposed to between one

business and another

c. Consumer-to-Business (C2B): Consumer directly contact with business vendors by posting

their project work with set budget online so that the needy companies review it and

contact the customer directly with bid. The consumer reviews all the bids and selects the

company for further processing. Some examples are guru.com, freelancer.com


d. Consumer- to- consumer ( C2C): It is an internet facilitated form of commerce that has

existed for the span of history in the form of barter, flea markets, swap meets, yard sales

and the like. Most of the highly successful C2C examples using the internet take advantage

of some type of corporate intermediary and thus are not strictly good examples of C2C.

B2b - Intel selling micro processors to Dell

- Heinz selling ketchup to Mc Donalds

B2C - Dell selling me a laptop

- Mc Donalds selling me a Big Mac

C2C - Mary buying an iPod from Tom on eBay

- Me selling a car to my neighbor

C2B - Me selling my old school books to a second hand book shop

Different types of payment systems in E-Commerce

There can be various electronic payment systems proposed or already in practice for E-commerce. But they

can be grouped into three categories, based on what information is being transferred online:

1. Trusted third party payments- This third party maintains all sensitive information (such as bank

account and credit card numbers) for its clients, which include both buyers and sellers. When there is a

transaction, order information is transmitted along with information about payment confirmation and

clearing, all of which do not include sensitive information. In effect, no real financial transaction is

done online e.g., first virtual.

2. Fund transfer It is an extension of notational fund transfer. In credit card or cheque transactions,

sensitive information is exchanged online. Hence, the information is encrypted because consumers are

familiar with this system and current payers have vested interest in extending that system to the

internet. Cyber cash and VISA/ Master cards SET- based transactions are examples of this system.

3. Digital cash, Electronic money, etc- This system includes variation of digital cash, electronic payment,

coins, etc. What distinguishes these systems from other two is not simply the animity they afford, but

the fact that what is being transferred is value or money itself. With second type, someone can

commit fraud by lifting the message (e.g. credit card number) by running up the charge on the users

account. With digital currency, intercepting a message is an outright theft of users property, not just

information.

Supply Chain Management

In words of council of Supply Chain Management Professionals (CSCMP) , supply chain

management (SCM) encompasses the planning and management of all activities involved in

sourcing and procurement, conversion and all logistics management activities.

It includes coordination and collaboration with channel partners, which can be suppliers,

intermediaries, customers, etc.


Thus SCM is a process of planning, implementing and controlling the operations of supply chain

with a purpose to satisfy the needs of customers.

It integrates supply and demand management within and across companies and spans all

movements and storage of raw material, work in progress inventory and finished goods from point

of entry to point of consumption.

SCM addresses the following problems:

1. Information: It integrates systems and processes through the supply chain to share valuable

information which includes demand, forecast, inventory, etc.

2. Inventory: It deals with the problem relating to inventory management such as quantity and location

of raw material, work in progress and finished goods.

3. Distribution of network configuration: It includes problem relating to number and location of suppliers,

production facilities, distribution centers, customers, etc.

4. Distribution Strategy: It address the various problems relating to distribution strategy such as whether

the distribution system should be centralized or decentralized, pull or push strategy, third party

logistics, cross docking or direct shipment.

Bull whip effect in SCM

Meaning: The Bullwhip Effect or Whiplash Effect is an observed phenomenon in forecast driven distribution channels. Forecasting demand: a. Customer demand is very unstable. So, organisation must forecast demand in order to arrange for inventory and other resources. b. Forecasts are based on statistics, and they are rarely perfectly accurate. So, Companies generally maintain additional inventory called safety stock. Safety stock: c. Moving up the supply chain from end consumer to raw materials supplier, each supply chain participant has greater observed variation in demand and thus greater is the need for safety stock. d. During the periods of rising demand, down-stream participants will increase their orders. e. During the periods of falling demand, orders will fall or stop in order to reduce inventory. f. Due to this the variations in demand are further amplified. Forecast driven Vs. demand driven supply chain: Supply chain experts have recognized that the Bullwhip Effect is a problem in forecast driven supply chains. g. The alternative is to establish a demand driven supply chain which reacts to customer orders.


h. The result is near-perfect visibility of customer demand and inventory movement throughout the supply chain. i. Better information leads to better inventory positioning and lower costs throughout the supply chain. j. Barriers to implement a demand driven supply chain include - investments in information technology and creating a corporate culture of flexibility and focus on customer demand. Factors contributing to the Bullwhip Effect: a. Forecast Errors b. Lead Time Variability c. Batch Ordering d. Price Fluctuations e. Product Promotions f. Inflated Orders g. Methods intended to reduce uncertainty, variability, and lead time: h. Vendor Managed Inventory (VMI) i. Just In Time replenishment (JIT) j. Strategic partnership (SP)

Bluetooth Technology

1. Bluetooth is an industrial specification that describes how mobile phones, computers and personal

digital assistants (PDAs) can be easily interconnected using short- range wireless connection.

2. Bluetooth provides a way to connect and change information between devices like mobile phones,

laptops, PCs, printers, digital cameras and video game consoles over a secure, globally unlicensed short

range radio frequency.

3. Bluetooth specifications are developed and licensed by the Bluetooth special interest group.

4. Bluetooth is based on low cost trans- receiver microchips in each device.

5. It is a radio standard and communications protocol primarily designed for low power consumption,

with a short range.

6. Bluetooth enables the devices to communicate with each other when they are in range.

7. These devices use a radio communications system so that they do not have to be in line of sight of

each other and even be in other rooms, so long as the received transmission is powerful enough.


Electronic Data Interchange (EDI)

Definition: The term EDI has many definitions. American National Standards Institute (ANS) has defined it as: Electronic Data Interchange is the transmission, in a standard syntax, of unambiguous information of business or strategic significance between computers of independent organizations. The users of EDI do not have to change their internal database. However, users must translate this information to or from their own computer system formats, but this translation software has to be prepared only one EDI refers to the electronic exchange of business documents and paper like invoices; bills purchase orders,

shipping notices, etc.

It is a three- step process:

1. Data from the application is translated into a standard format.

2. It is transmitted over communication lines to the trading partner.

3. At last, it is re- translated by the trading partys applications.

The process works in reverse when the trading party wishes to send the EDI transactions.

The three components of EDI are:-

1. Communication To function the EDI, one should have a communication software, translation

software and access to standards. Communication software moves data from one point to another and

flag the start and end of the document. Translation software helps the user to build a map and shows

him how the data fields from his application corresponds to the elements of EDI standards. It also

converts data back and forth between the application format and the EDI format.

2. Mapping- To build a map the user first selects the EDI standard for the kind of data he wants to

transmit. Usually the trading party tells about the kind of standards to be used. Next, he edits out parts

of the standards which do not apply to his application. Next, he imports a file that defines the fields in

his application and finally he makes the map to show where the data required by the EDI standards is

located in his application. Once the map is built, the translator will refer to it during EDI processing

every time a transaction of that type is sent or received.

3. Profile- The last step is to write a party profile that tells the system where to send each transaction and

how to handle errors or exceptions. Whereas, the user needs a unique map for every kind of

document to be exchanged with a party, he should only have to define party information once.

For example, let us see how EDI works in a retail environment

The retailer will initiate the process with an electronic transmission of an electronic Purchase

Order (850). The supplier will receive the order, case it and print UCC-128 labels. Then,

the order is packed and the UCC-128 labels are placed on the cartons. The cartons are then

shipped to the retailer and the supplier electronically transmits an Advanced Ship Notice

(856). After the shipment has been sent, the supplier transmits an electronic Invoice (810) for

the goods. These electronic documents are sent in a standard Electronic Data Interchange

(EDI) format.


Advantages offered by EDI are enumerated below: -

1. Purchase orders: Most purchasing transactions are routine and therefore they can be handled

automatically. Use of EDI for processing purchase orders frees the operating staff that can be utilized

for more demanding and less routine tasks.

2. Increased sales: EDI ensures easy and efficient processing of quotations, estimates, and order entry

and invoicing, which ensures that information is available immediately. This facilitates faster sales

processing and increased sales order.

3. Faster Payments: Since invoices received electronically are reconciled automatically, they are

earmarked for payment sooner. This in- turn strengthens the position of the purchase department to

negotiate for better terms including faster payments.

4. Minimize locked up capital: For manufacturing organizations with a just- in- time strategy, the right

balance is crucial but every organization stands to benefit from reducing order lead times. There is also

a reduction in capital locked up in inventories.

5. Paperless office: Since letters and memos are handled by an electronic mail system, and do not follow

rigid rules for formatting, they are easier to handle and the organization can progress towards

paperless office.

6. Decreased Inquiries: Direct online inquiries on product availability or other such non- sensitive

information can be handled quickly and efficiently by the EDI.

7. Better business relationship: Data arrives much faster and there is an automatic acknowledgement.

There is also strict discipline among users that facilitates data transmission and enables more informed

decision- making. This finally improves the relation between the trading partners.

Customer Relationship Management (CRM)

CRM is a corporate level strategy which focuses on creating and maintaining good relationships for a long

period with its customers. There are software packages available to support CRM strategy. Changes should

be made in the organizations at all levels including policies and procedures. The CRM process needs to be

integrated end to end across the marketing, sales and customer services. A good CRM program needs to:

1. Identify customer success factors

2. Create a customer based culture

3. Adapt customer based measures

4. Develop an end to end process to serve customers


5. Recommend what questions to ask to help a customer solve a problem

6. Recommend what to tell a customer with a complaint about purchase.

7. Track all aspects of selling to customers and prospects as well as customer support.

There are three parts of application architecture of CRM

1. Operational: Automation is provided to the basic business processes like marketing, sales, services.

2. Analytical: Support to analyze customer behavior, implements business intelligence alike technology.

3. Collaborative: Ensures the contact with customers like phone, Email, Fax, web, SMS, post, in person.

Purposes of CRM

CRM means managing all interactions and business with customers. A CRM program will allow a business

to acquire customers, services to customers increase the value of the customers to the company retain

good customers and determine which customers can be retained or given a high level of service. It can

improve customer service by facilitating communication in several ways:

1. Provide product information, product use information and technical assistance on web sites.

2. Identify how each individual thinks about the quality.


3. Provide a fast mechanism for managing and scheduling follow up sales.

4. Provide to track all points of contact between the customer and the company.

5. Help to identify potential problems quickly before they occur.

6. Provide a user friendly mechanism for registering customer complaints.

7. Provide a fast mechanism for correcting service deficiencies.

8. Use internet cookies to track customer interests and personalize product offerings accordingly.

9. Use the internet to engage in collaborative customization or real time customization.

10. Provide a fast mechanism for managing and scheduling maintenance, repair and ongoing support

(improve efficiency and effectiveness)

11. The CRM can be integrated into other cross functional systems and thereby provide accounting and

production information customers to customers when they need it.

E- Mail

E-mail (electronic mail) on internet provides quick transfer of messages, memos, and letters on computer

to other E-mail users worldwide. This is probably one of the fastest and most convenient ways of

communication. At the present all internet subscribers in India get the E-mail facility free with each

subscription. E-mail account can be accessed by the subscriber from any part of the world. People use E-

mail because:

1. It is cheap: It is typically cheaper than faxing, postage, long- distance telephone charges.

2. It is fast: Email messages are delivered within a few minutes or even seconds.

3. Convenient to communicate: with E-Mail, people may write on computer and then send the message

on its way with a few key strokes- no paper, no postage and no problems.

4. It is confidential: for most practical purposes, email is completely private and confidential.

Features of an E-mail:

1. Composing messages: Internet browser helps in composing messages in an attractive way with the

help of various fonts.

2. Replying to the E-mail received: Reply facility on the browser helps in replying to the mail received.

Same reply can be sent to all the recipients of the original message.

3. Address book- this is an electronic form of address book which contains the name, full name, e-mail

addresses, etc of the various persons.

4. Transfer of data files: An important use of the Email is the ability to send/ receive data files from a

client.

5. Hard copy of message: It makes possible to keep hard copy of any message. It facilitates the user to

read all the messages when the user is offline.

6. Storage: The message is stored in the auxiliary storage of the receiving computer and a signal is

displayed on the screen of the receiving computer indicating the receipt of the electronic mail. The

user then displays the message.

7. Notification: When message is displayed the communication software notifies the sender that

message has been viewed.


Voice messaging

Meaning: Voice messaging is similar to E- mail except that it is an audio message that is processed.

Software: Computer should be equipped with the software to store the audio messages in digital

form and then convert them back in an audio form upon retrieval by the user.

Working of voice messages: A sender speaks into a telephone rather than typing; giving the name

of the recipient and then message and that senders voice signal is then digitized and stored. The

system can then either deliver the message at a specified time in the future or it can be retrieved

from a database by the recipient. The message is reconverted back into its analog format when it

is delivered or retrieved so that the recipient hears it as the original senders voice on the

telephone.

Advantages:

Sender does not have to type.

Voice mail also makes it easy to include people in the firms environment in a

communication network.

WiFi

Wifi means Wireless fidelity which describes the underlying technology of wireless local area network based

on IEEE 802.11 specifications. WiFi is used for mobile computing devices, Internet and VOIP phone access,

gaming applications, consumer electronics, public transports and mobile commerce, etc.

Wi-Fi Certification

It means its safe to buy. The color coded standard Indicator Icons (SII) on product packaging is the only

assurance that a product has met rigorous interoperability testing requirements to ensure that compatible

products from different vendors work together.

Tele-conferencing

It is an electronic meeting of people who are at different physical sites. Telecommunication technology system

allows meeting participants to interact with one another without travelling to the same location.


It enables people at remote to see and talk to each other and share charts and other visual meeting materials,

without the need for time consuming and expensive travel. Three different types of teleconferencing exist;

audio teleconferencing, video teleconferencing and computer teleconferencing:-

1. Audio Teleconferencing It is the use of voice communication equipment to establish an audio link

between geographically dispersed persons. The conference call was the first form of audio

conferencing and is still in use.

2. Video Teleconferencing- It is the use of the television equipment to link geographically dispersed

conference participants. The equipment provides both sound and picture. Life audio conferencing,

Video conferencing also does not require a computer.

With video conferencing the participants can see each other and also hear. There are three possible

video conferencing configurations:-

i. One way audio and Video

ii. One way Video and Two way audio

iii. Two way video and audio

3. Computer conferencing- Computer conferencing contemplates use of a networked computer through

which participants with some same or similar interest exchange information on any particular topic.

Computer conferencing can be called as a disciplined form of email since both use the same hardware

and software. It can consist of large numbers of participants. It differs from audio and video

conferencing because it can be used within a single geographical site.

Multimedia

Multimedia is the combination of sound and image with text and graphics. It is one of the most exciting

and appealing uses of computer today.

A computer with multimedia capabilities is composed of the following components:

A PC with high capacity memory (at least 8 Mb) and a high resolution monitor.

Compact Disk Read only memory (CD-ROM)

Built in sound card and speakers

Multimedia support software

Multimedia application software (usually recorded on the CD-ROM)

Optionally: Micro phone and a Digital Video camera.

Multimedia applications allow the users to interact with the system by text, high- resolution

graphics, motion video, animation and sound.

Multimedia is most commonly used in education, publication music, movies, games, arts and other

entertainment. Multimedia is used in application development for business involving:

a. Presentation

b. Directions and directories using touch screen to find information about cities, company,

products, etc.

c. Tutorials, computer based training (CBT) and computer based edition (CBE).

d. On-line references: Replacing manuals, product information booklets, encyclopedia, etc.

e. Interactive publication; books, magazines, newspapers, etc.


Webcasting / Push Technology

Webcasting is a way of receiving broadcast information by the users instead of searching the web

actively. Push technologies primarily relates to information that is pushed to ones web page, as

opposed to ones computer getting the information from the web.

This technology allows the users to choose from a menu of sources, specifying what kind of

information they want to receive. Once selected, the information is automatically forwarded to the

users. However, to use this service or technology requires Webcasting software and an ISP that can

hose ones webcast server.

Push Technology differs from the traditional use of internet. The internet, is for the most part a full

environment where a user open a browser application and searches for information, this is time

consuming and frustrating. Push technology eliminates this frustration.

An example of Push Technology is Internet news services, which deliver the days activities to the

users desktop.

Electronic Fund Transfer (EFT)

EFT represents the way the business can receive direct deposits of all payments from the financial

institution to the company bank account. Once the user signs- up, money comes to him directly. It is fast,

safe and means that the money will be confirmed in users bank account quicker than he had to wait for

the mail, deposit the cheque and wait for the funds to become available. Following are some examples of

EFT systems in operation.

i. Automated Teller machines (ATMs): These machines are used with a debit or EFT card and a code,

which is often called a personal identification number or PIN.

ii. Point- of sale (POS) transactions: Some debit or EFT cards (referred to as check card) can be used

when shopping, to allow the transfer of funds from the consumer A/c to the merchants.

iii. Pre- authorized transfer: Under this method funds are automatically deposited or withdrawn from

an individuals account, when the account holder authorizes the bank or a third party to do so.

iv. Telephone transfers: Funds can be transferred from one account to another from saving to

checking e.g. can order payments of specific bills by phone.


Types of Electronic payments

Credit cards

In this transaction, the consumer presents preliminary proof of his ability to pay by representing his credit card

number to the merchant. The merchant can verify this with bankers and create a purchase slip for the

customers. The merchant then uses the purchase slip to collect the amount from the bankers. Credit cards can

be handled in two ways-

1. Sending unencrypted credit card number over the internet.

2. Encrypting the credit card details before any transaction is transmitted.

Manual Credit Card transaction: In a credit card transaction, the consumer presents preliminary proof of his ability to pay by presenting his credit card number to the merchant. The merchant verifies this with the bank and creates a purchase slip which is endorsed by the consumer. The merchant then uses this purchase slip to collect funds form the bank, and On the next billing cycle, the consumer receives a statement form the bank with a record of the transaction. Credit card transaction through internet: a. The same procedure is followed to make purchases over the internet. b. But on the Internet, additional steps must be taken to provide more security to the transactions and for authentication of both buyer and seller. c. Variety of systems are developed for using credit cards over the Internet. d. 2 main distinguishing features of these systems are: the level of security they provide for transactions, and the software required on both the customer and business sides of the transaction. e. Credit cards can be handled on line in two different ways: Sending unencrypted credit card numbers over the Internet, Encrypting credit card details before any transaction is transmitted. Unencrypted credit card information: A customer browsing the web might enter a credit card number in an order form and click a submit button to transmit the information to the merchants web server. Since the data is raw, anyone can intercept the transmission. So, there is no security for this type of transaction. On the other hand an unscrupulous merchant (or someone posing as a merchant) can use such unencrypted numbers for illegal charges.


Encrypting credit card details: Encrypting credit card transactions can also be subdivided according to what is encrypted. If the entire transmission between buyer and merchant is encrypted, the merchant has to decrypt at least the order details to complete the purchase. But sensitive information like credit card numbers will be visible to merchant and he/his employees may misuse such information. To protect against this, a trusted third party can be used to separately handle credit card and order data with a wallet as helper application. Such third party decrypts the credit card information for authorization of the purchase. Transaction Using Third Party Verification The market for handling credit card purchases on the Internet is yet to develop as a single way of doing things, or a single standard that allows the software from different vendors to work together. Due to lack of interoperability it is likely to slow down both consumer and business acceptance of using credit cards for making purchases on the Internet. However, there are 2 significant standards that will make the interoperability of electronic wallet and credit card transactions simpler, both for consumers and businesses.

Secured Electronic Transactions (SET)

SET is Secured Electronic Transaction Protocol developed by consortium led by Master card and VISA.

SET is a combination of protocol designed for use by other applications such as web and a standard for

handling credit card transactions over the internet. SET uses digital certificates to ensure the identities of all

parties involved in a purchase. SET also encrypts credit card and purchase information before transmission on

the internet.

Joint Electronic Transaction

The second standard is Joint Electronic Payments, led by World Wide Web Consortium and Commerce Net. JEPI is an attempt to standardize payment negotiations. On the buyers side, it serves as an interface that enables a Web browser and wallets to use a variety of payment protocols. On the merchants side, it acts between the network and transport layers to pass off the incoming transactions to the proper transport protocol (for e.g. e-mail vs. HTTP) and proper payment protocol (such as SET) Multiple protocols will be around for payment, transport and wallets. JEPI makes it easier for the buyer to use a single application and a single interface, in a variety of commercial situations.

Electronic Cheques

An electronic cheque has all the features as a paper cheque.

It acts as a message to the senders bank to transfer funds.

Like a paper cheque, the message is first given to the receiver who, in turn, endorses the cheque and presents it to the bank to obtain funds.


The electronic cheque can prove to be superior to the paper cheque in one significant aspect. The sender can protect himself against fraud by encoding the account number with the banks public key. Thus it is not necessary to reveal the account number to the merchant.

Similar to SET protocol, digital certificates can be used to authenticate the payer, the payers bank, and the bank account.

Credit card payments will undoubtedly be popular for commerce on the Internet. However, following 2 systems have been developed to use electronic cheques to pay Web merchants directly. 1. FSTC: The FSTC is a consortium of banks and clearing houses that has designed an electronic cheque. Designed in the lines of traditional paper cheque, this new cheque is initiated electronically. It uses digital signature for signing and endorsing. 2. Cyber Cash: This is an extension of wallet for credit cards, and it can be used in the same way to make payments with participating vendors. Cyber Cash will not serve as an intermediate party for processing the cheque. That function will be handled directly by banks. Extending electronic checks to existing payment systems: Electronic cheque can be delivered either by direct transmission over a network or by e-mail. In either case, existing banking channels can clear payments over their networks. This has lead to a convenient integration of the existing banking infrastructure and the Internet.

Smart cards

Smart cards are embedded microchip instead of magnetic strip. This chip contains all the information

a magnetic strip contains but offers the possibility of manipulating the data and executing the

applications on the card. There are three types of smart cards: -

Contact cards - Smart cards that need to insert into a reader in order to work, such as a smart card reader or automatic teller machines.

Contact les cards - Contactless smart cards dont need to be inserted into a reader. Just waving them near a reader is just sufficient for the card to exchange data. This type of cards is used for opening doors.

Combi cards- Combi cards contain both technologies and allow a wider range of applications.

Mobile commerce

It is about the explosion of applications and services. These are becoming accessible from Internet enabled

mobile devices. This involves new technologies, services and business models. M-Commerce is the buying and

selling of goods and services through wireless handheld devices such as cellular telephones and personal

digital assistances. These are known as next generation e- commerce. This is based on wireless application

protocol. Mobile devices are equipped with Web ready micro browsers. Using blue tooth technology smart


phones offer fax, email and phone capabilities all in one, giving the way for M-Commerce applications. The

industries affected by M-Commerce include:

1. Financial services

2. Telecommunications

3. Service and retail industry

4. Informational services

IBM and other companies are experimenting with speech recognition software as a way to ensure security

for M-commerce transactions.

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