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Organizations have commerce as one of their crucial day-to-day activities irrespective of their industry of operation. Commerce involves the exchange of services and goods between consumers and suppliers or manufactures. In this process, communication and information flow is vital. In this extent, electronic business technology is essential.
According to Beynon-Davies (2004), e-business refers to “application of information and communication technologies (ICT) to support all activities of business” (p.23). It is concerned with the deployment of ICT in helping to build relationships coupled with supporting various activities of business with other businesses, groups, and individuals (Westfall, 2010).
Due to the challenges of cyber attacks, E-business faces a number of security challenges. The aim of this research project is to analyze some of the threats that influence the progress of E-business as a tool for making commerce effective and efficient by using Amazon.com as a case example.
The purpose of the research project is to create awareness that, even through e-business presents an advantage to global traders, organizations using it to reach global buyers must appreciate that it also presents a substantial disadvantage about which they must remain vigilant.
Migrating from the traditional systems of doing business implies that organizations have found an alternative way of doing similar business activities in more efficient and effective ways. E-business systems are one of these ways.
Even though e-business helps to resolve the challenge of effectiveness and efficiency associated with the traditional systems, Timmers (2000) maintains, “E-Business systems naturally have greater security risks than traditional business systems” (p.31). This claim means that proactive strategies need to be deployed to ensure that systems of the e-business are secure against various risks to which they are susceptible.
E-business systems engage and enhance repeated contact with other business systems more than traditional systems (Timmers, 2000). Hence, employees, customers, and even suppliers among other people use business systems of organizations on a daily basis to give their confidential information to facilitate completion of transactions including money transfer through credit cards.
While they do so, they always anticipate that confidentiality of their information would be maintained (Westfall, 2010). On the other hand, hackers are keen on tracking the transactions made by people with the intention of conducting malicious attacks.
Conceptualization of likely risks while conducting commerce via e-business is concerned about maintaining the information of customers safe, private, and confidential. Effort is also made to ensure that the information provided by an organization is authentic possessing high levels of integrity.
Unfortunately, malicious people focus on destroying the reputation of an organization by interfering with these two essential qualities for any data provided by an organization to its clients as the basis of making commerce decisions.
Fickes (2006) identifies, “physical security measures, as well as data storage, data transmission, anti-virus software, firewalls, and encryption” (p.37) are some of the methods of ensuring that the customers’ information remains secure. The method also helps in securing e- business (Fickes, 2006).
There is rich scholarly research documenting a number of security risks associated with e-commerce. Asare (2011) pin points confidentiality and privacy as one of these risks. According to Asare (2011), in the context of e-business security concerns, confidentiality refers to “the extent to which businesses make personal information available to other businesses and individuals” (p.312).
Therefore, it is imperative that an organization, which conducts its business electronically such as Amazon.com, strategically focuses on ensuring that information gets to the intended persons only.
Unfortunately, this challenge is incredible particularly where transactions conducted online will involve the transfer of data in the form of files and records, which must be shielded from unauthorized access (Fickes 2006) in terms of ensuring safe transmission coupled with storage of the data.
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According to Westfall (2010), in an e-business environment, firewall and encryptions help to facilitate these concerns. However, authenticity remains a significant challenge in execution of e-commerce.
Electronic information can easily be copied and altered. This challenge makes e-business transactions present immense challenges in the establishment and maintenance of authenticity of information (Fickes 2006). The goal of checking the authenticity of people engaged in an e-commerce is to determine that parties are actually the people they claim to be.
From the end of the consumers, they need to be sure that, when they make an order accompanied by an electronic payment, the selling company will actually honor the transaction and or deliver the goods and or services in both the right time and the right quantity and quality.
To enhance this requirement, Westfall (2010) argues that limiting access to the e-business system or information sharing between trusted parties via strategies such as deployment of VPN (visual private network) technology can incredibly aid in fostering authenticity of information communicated in an e-business environment.
Amazon.com utilizes other strategies such as digital signatures that require input of credit cards number, PINs, and passwords to limit access into its e-business system.
Efforts to enhance security of e-commerce systems are aimed at enhancing reliability of e-transactions as the easiest ways embracing the roles of technology in enhancing the way people conduct businesses across geographically disjointed regions. It is for this purpose that the European Union launched a plan branded “European information society” (Meier & Stormer, 2008, p.45).
This action plan stipulates that internet resources and technologies are central to broadening the ability of organizations to function as individuals in the sense that they foster exchange of relations and transactional contacts.
Thus, it is vital for “opportunities and risks of electronic means of communication to be weighed against each other with the protection of intellectual property and private sphere being maintained” (Meier & Stormer, 2008, p.78). With this requisite, risk of proper information flow is an essential aspect for consideration in execution of e-business transactions.
The case of Amazon.com and e-business
Amazon.com started its online marketing business through specialization in book selling. The company then realized that there was inadequate leadership of the industry especially in stocking books that were out of print.
As Cosper (2012) asserts, “by converting his garage into a warehouse, Amazon.com founder Jeff Bezos was able to establish Amazon as an online bookseller while focusing on six core values he identified as customer obsession, ownership, bias for action, frugality, high hiring bar, and innovation” (Para.2). When online selling of books picked up, the company expanded into selling other products including DVDs.
The company uses two types of e-business commerce: B2B and B2C. For the business-to-consumer commerce (B2C), Amazon.com organizes its e-business around organizations (sellers) and consumers (individual buyers). B2C brings together an immense number of purchasers who make millions of transactions on a daily basis with a number of organizations (sellers).
Since Amazon.com is an online retailer, B2C works best for it. Therefore, the company has to ensure cute management of the large number of transactions while maintaining security, confidentiality, and integrity of the business information being shared by the company and its consumers.
This requirement has the impact of making B2C e-business for Amazon.com an incredibly complex and difficult task since every item bought by a customer must be shipped and delivered at the right time with optimal security. Through B2B (business-to-business) e-commerce strategies, Amazon.com organizes its online retailing business such that sellers and buyers are business organizations.
From the sale-side of B2B, Amazon.com deploys the e-commerce strategy to hike its sales level with reduced expenditure of ads. From the buy side model, the company obtains the products it needs for suppliers in an electronic manner. Both strategies entail massive transfer of information between consumers, Amazon.com, and suppliers.
Amazon.com deploys information systems to conduct almost every aspect of its business functions. From marketing and sales systems point of view, Amazon.com uses information systems to market and sell its products to many people who are distributed randomly across the globe.
Through the systems, the organization is able to monitor various trends that influence sale efforts of its products, plans for new distribution networks, and monitoring of the operations of its competitors. Marketing and sale information systems are also central to the operations of Amazon.com since they support a marketing research of the company.
They help it to analyze strategies such as marketing and evaluation of sale performance and pricing decisions since all information on historic trading trends are contained in a single database.
Through interactions with customers on a single platform, the company is able to locate more and prospective customers in a bid to provide services such as customer support to existing customers. In all these functions, Amazon.com has to handle and share a myriad of information with its customers. Issues of security risks are one of the things that the company has to address.
Conclusion and recommendations
In conclusion, Amazon.com developed its business model in the early 1990s. The main aim of the models was to facilitate utilization of web technology to perform business transactions including payments and ordering of products. Although the model picked slowly, consumers were able to replace ordering through physical documents to ordering via mouse clicks.
The model has seen Amazon.com make massive returns on investments in the industry of online clearinghouse. This success has been realized amid the hefty investments of online security systems including firewalls and VPN strategies among others. From this perspective, the paper focused on introspection of the literature review on issue pertaining to e-business security concerns.
This subject was found indispensable in the paper since conducting business in an online environment exposes information systems of organizations into risks of unauthenticated access often leading to loss or even alteration of the confidential information for specific clients as it pertains to placement of orders and or exchange of monetary transactions.
Even with the heavy concern on cyber security of the information systems of the company. Amazon.com has often been caught up as a victim of online hacking. Based on this argument, the paper recommends that one of the substantive issues that Amazon.com has to incorporate in its strategic decisions for growth is a mechanism of enhancing security of its e-commerce systems.
Such a strategy would help to enhance the integrity and confidentiality of information flowing between the Amazon.com, consumers, and suppliers.
Asare, S. (2011). B2B and B2C E-commerce Security Concerns for SMEs: a case study of two African countries. International journal of knowledge and research in management and commerce, 1(2), 312-356.
Beynon-Davies, P. (2004). E-Business. Basingstoke: Palgrave.
Cosper, A. (2012). Description of how Amazon uses e-business and e-commerce for B2B and B2C. Retrieved from https://smallbusiness.chron.com/description-amazon-uses-ebusiness-ecommerce-b2b-b2c-36453.html
Fickes, M. (2006). B2B security. Access Control and Security Systems Integration, 43 (10), 37-40.
Meier, A., & Stormer, H. (2008). E-Business and E-Commerce: Managing the Digital Value Chain. New Jersey, NJ: Springer.
Timmers, P. (2000). Electronic Commerce – strategies & models for business-to-business trading. New York, NY: John Wiley & Sons, Ltd.
Westfall, J. (2010). Privacy: Electronic Information and the Individual. Santa Clara: Markkula Center for Applied Ethics.