This report proposes the various issues that Mt. Helen MedTech should consider in its pursuit for a high competitive advantage by integrating e-commerce in its operation. The report focuses on the critical issues that the firm’s management team should consider in the process of implementing e-commerce.
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First, the most effective e-commerce model that the firm should take into account is identified and evaluated. The report proposes that the revenue model, applications security, and e-marketing requirements should be integrated. The sales revenue model is identified as one of the most effective models that should be adopted.
Moreover, the report proposes the various measures that should be implemented in order to enhance the security of the implemented e-commerce technologies.
Other issues that are evaluated relate to the payment method, privacy issues, customer service issues, legal issues, and how the firm can utilise web analytics in improving the effectiveness and efficiency of its e-business activities.
Mt. Helen MedTech is a small and medium sized retail enterprise that is based in Mt. Helen, Victoria. The firm retails a range of surgical and medical assistive technologies. In addition to retailing, the firm also operates a wholesale export business. However, its core business entails selling surgical and medical assistive technologies to domestic healthcare providers in Australia.
The firm has undergone significant growth since its inception. The firm’s capitalisation is estimated to be $A 10 million, while its annual sales volume is estimated to be $A 6 million. The firm’s annual sales revenue is growing at an annual rate of 10%, while the net profit is estimated to be 10% of the total sales.
Despite the firm’s growth, Mt. Helen MedTech is experiencing a number of challenges emanating from the external business environment. Some of these challenges relate to increment in the intensity of competition, changing economic environment, and change in consumer behaviour, which pose a major threat to the firm’s survival.
Mt. Helen MedTech management team has an obligation to enhance the firm’s competitive edge. One of the avenues through which the firm can develop its competitiveness is by integrating electronic commerce. Gangopadhyay (2002) defines e-commerce as “the trade of goods and services by electronic means” (p. 200).
The emergence of e-commerce has enhanced businesses’ competitiveness by enabling them to venture into the international market. Furthermore, businesses have improved their capability to attract and retain customers by addressing their service and product needs more efficiently and effectively.
This report proposes how Mt. Hellen MedTech can improve its competitive advantage by integrating e-commerce. The report evaluates the issues that the firm has to take into account in order to ensure that e-commerce is incorporated successfully in the firm’s operations.
According to Canzer (2006), many businesses that have incorporated e-business in their operation have done so depending on their customer focus. For example, some businesses utilise the Internet in undertaking their operations with other businesses.
Mt. Helen MedTech core business entails selling surgical and medical assistive technologies to other healthcare providers. The firm’s management team should consider integrating business-to-business (B2B) electronic commerce model.
According to Canzer (2006), B2B business model is critical in developing a strong relationship between companies, which might be dispersed geographically. Incorporating B2B e-commerce model will improve MedTech’s ability to interact with its institutional customers via the Internet.
B2B business model will play a critical role in minimising the costs involved in developing customer relationships. For example, the firm will not be required to develop annual purchase orders in addition to eliminating the cost associated The firm will be in a position to develop and sustain a strong network of institutional customers.
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Considering the nature of its business operations, Mt. Helen MedTech should consider incorporating two main B2B systems, which include Electronic Data Interchange [EDI] and the Enterprise Resource Planning [ERP].
EDI refers to a form of e-business system that is used in the process of exchanging electronic documents between trading partners through private or value added telecommunication lines. According to UNCTAD (2006), EDI is based on codes, which are agreed upon by the trading partners.
Incorporating EDI will allow Mt. Helen MedTech to improve the effectiveness with which business transactions are conducted. For example, EDI will lead to the elimination of paper-based purchasing processes.
The second aspect that the firm should consider relates to the implementation of ERP. Canzer (2006) defines ERP to include “the back-office accounting software systems that handle data entry, purchasing, invoicing, and inventory control” (p.21).
Implementing the ERP technology will improve the efficiency with which the firm undertakes it data exchange processes with the customers. Incorporating EDI will enable the firm to develop an efficient customer response, hence improving its supply chain (Kalakota & Robinson, 2000).
The success of e-business is dependent on the effectiveness with which a firm develops the revenue model. Manzoor (2010) defines revenue model to include the process through which a firm intends to make money from its business operations. Businesses can implement different revenue models including transaction fee, subscription model, affiliate model, and sales model.
One of MedTech’s objectives is to maximise its level of profitability via improving its sales capability both in the local and in the international market. The sales revenue model entails integrating measures aimed at generating sales revenue by providing information, offering services to clients, and selling goods (Jawadekar, 2013).
Given that the firm deals with tangible products, it is imperative to consider implementing a merchant model as its core sales revenue model. Therefore, the firm will be required to develop an electronic storefront.
The firm can achieve this goal by implementing and effecting information-technology infrastructure. The infrastructure should be integrated in its official website. Moreover, the website should have the capacity to receive and process the customers’ orders (Shaw, 2001).
For successful implementation of the e-business, it is imperative for the firm to implement effective e-commerce applications. The firm can consider a number of applications. One of the applications relates to procurement application.
The application will improve the effectiveness with which customers purchase medical and surgical products from the company. For example, the procurement application will improve the effectiveness with which the firm identifies the customers’ needs by interacting with them through the company website.
Moreover, the firm’s customers will solicit bids and proposals hence providing the firm with an opportunity to evaluate the bids effectively. Subsequently, the firm will be in a better position to deal with the customers’ purchase orders.
It is also imperative for the firm to integrate effective online marketing and advertising applications. One of the ways through which the firm can achieve this goal is by conducting comprehensive marketing campaign through Internet-based mediums such as search engines and e-mail marketing.
Moreover, it is imperative for the firm to consider adopting the concept of electronic publishing to create sufficient level of market awareness regarding the firm’s operations amongst the healthcare providers in both the local and the international market.
In addition to the above applications, it is imperative for the firm to implement an effective e-banking application. This application will improve the effectiveness with which customers pay for goods and services.
Some of the e-banking applications that the firm should consider include Internet banking and mobile phone banking. Integrating effective an e-banking application will make it effective for both onshore and offshore customers to pay for the goods purchased efficiently.
It is imperative for the firm to understand that the Internet exposes both businesses and customers to numerous risks. Jawadekar (2013) emphasises, “The vulnerability of the e-business systems, applications, and processes increases due to the very nature of its openness to both internal and external individuals” (p. 109). Subsequently, the firm should implement effective security measures.
The security measures should aim at protecting the software and hardware on which the implemented applications run. This move will play a critical role in safeguarding the firm’s reputation, hence improving the level of trust amongst the customers in the course of involving themselves with various online activities such as e-procurement.
In a bid to enhance the security of its e-business activities, Mt. Helen MedTech should focus on integrating a number of security measures.
First, the firm should ensure that only authorised persons are allowed to access the e-business network. The firm should also consider integrating digital certificates such as credit cards to ensure that only authorised parties can access the firm’s applications.
Other security measures that should be implemented include effective antivirus software, intrusion detection systems, firewalls, and encryption. The firm should also undertake a penetration testing in order to gauge the security level of its e-commerce applications.
The effectiveness of Mt. Helen MedTech in its e-business activities will be determined by how well it undertakes it e-marketing activities. In order to maximise its sales revenue, it is fundamental for the firm to consider a number of factors. First, the firm should implement optimal Internet capabilities.
One of the ways through which the firm can achieve this goal is by developing effective intranet and Internet capabilities. The intranet capabilities will provide the firm an opportunity to exchange business information with its customers.
The firm will be required to hire qualified and experienced web and Internet marketing developers to aid in optimising the benefits associated with online marketers. For example, marketers will effectively design and post the necessary online marketing content on the firm’s website for clients to view.
MedTech should train its marketing workforce on how to optimise on the benefits associated with the Internet. This aspect will improve the likelihood of the firm maximising its sales revenue.
In addition to the above requirements, the firm should also consider implementing an online performance measurement. Subsequently, the firm will be in a position to evaluate the effectiveness of the implemented e-business activities.
In a bid to develop sufficient e-business capabilities, MedTech has to provide customers with an opportunity to pay for the goods purchased effectively and efficiently. Consequently, the firm should implement an effective e-payment system.
One of the ways through which the firm can achieve this goal is by implementing an effective Electronic Funds Transfer system. This technique will enable the firm to eliminate paper-based payment transactions. The firm should also consider designing payment cards.
However, the firm should ensure that optimal security measures are integrated in the cards so as not compromise the payment process. Moreover, the firm should also consider incorporating electronic money systems. Specifically, MedTech should integrate the software-based form of electronic money.
Botha, Bothma, and Geldenhuys (2008) define this form of electronic money as “a form of payment that operates through computer networks and the Internet, hence providing customers an opportunity to undertake remote payments” (p.234). Other payment techniques that the firm should consider include electronic cheques and electronic wallets.
Secondly, the firm should not share customers’ information with third parties. Moreover, the firm should desist from using technologies that can capture the customer’s confidential information. Such a policy will play an essential role in promoting the level of confidence amongst its customers.
The firm should be cognisant of the likelihood of encountering diverse legal issues. In order to safeguard itself from different legal issues, the firm should formulate a comprehensive set of online terms, policies, conditions, and laws. The firm should ensure that customers understand the prevailing terms and conditions of engaging in e-commerce activities with the firm.
Given that the firm intends to maximise its sales revenue by engaging in international marketing, it is imperative for the firm to understand the prevailing international issues. One of the issues that the firm should take into account relates to jurisdiction. The firm should also consider incorporating copyright and trademark.
Customer service issues
Optimal customer service is critical in businesses’ effort to maximise the sales revenue. The firm should focus on nurturing a high level of customer service. Considering the view that customer service in e-commerce is provided through automated technologies, it is imperative for the firm to ensure that a high level of customer satisfaction is developed.
This goal can be attained by providing customer service in three main stages, which include pre-purchase, during the purchasing process, and after the purchase.
Pre-purchase customer service should entail providing customers with electronic presentations and catalogues, while the purchase phase entails enhancing the customers’ purchase process through online payment systems, online order entries, and online negotiations.
With regard to post purchase level, the firm should address the issues raised by customers regarding their purchase process and product experiences.
It is important for the firm to integrate effective web analytic tools in order to understand the customers’ behaviours. The web analytic tools will aid in gaining insight on different issues.
Some of the metrics that the firm should track include the visitors’ trend, page views, referrals, bounce rates, keywords, and phrases. Subsequently, the firm will gain insight on how it can improve its site into sales. One of the analytics tools that the firm should consider is the Google Analytics.
Conclusion and recommendations
This report shows that Mt. Helen MedTech can improve its competitive advantage and hence its long term survival by implementing the concept of e-commerce. E-commerce will enable the firm to attain its cost minimisation objective by eliminating different operational challenges.
However, it is imperative for the firm to consider taking into account different issues, which include an effective e-commerce model, revenue model, e-commerce applications, security measures, and e-marketing requirements. Moreover, the firm should take into account payment, privacy, and customer service, analytics, and legal related issues.
Botha, J., Bothma, C., & Geldenhuys, P. (2008). Managing e-commerce in business. Cape Town, SA: Juta.
Canzer, B. (2006). E-business: strategic thinking and practice. Boston, MA: Houghton Mifflin.
Gangopadhyay, A. (2002). Managing business with electronic commerce: issues and trends. Hershey, PA: Idea Group Publishers.
Joseph, T. (2012). E-commerce: An Indian perspective. New Delhi, India: Prentice Hall.
Jawadekar, W. (2013). Management information systems: texts and cases; a global digital enterprise perspective. New Delhi, India: McGraw-Hill Education.
Kalakota, R., & Robinson, M. (2000). E-business 2.0: Roadmap for success. Boston, MA: Addison-Wesley.
Manzoor, A. (2010). E-commerce; an introduction. Saarbrucken, Germany: Lambert Academic Publishers.
UNCTAD: Information economy report: the development perspective. (2006). New York, NY: United Nations.
Shaw, P. (2001). E-business privacy and trust: planning and management strategies. New York, NY: John Wiley & Sons.