Executive Summary
This paper explores the aspect of business that has been referred to as electronic commerce. A number of things are examined, for instance some of the important concepts in this subsector. They include for example the Internet and other networks that are important for this business to occur. A short history is given on the development of this form of electronic commerce to date.
The airline industry is then studied in relation to its uptake of electronic commerce and current industry developments. After that, Air Canada’s electronic commerce segment is used as examples for this paper. Some of the principles behind its design also discussed. The shortcomings of this electronic commerce site are then looked at and possible remedies suggested. The ethical issues that pertain to electronic commerce are then given as a way of concluding the paper.
Introduction
The name e commerce can be used in reference to not only the giving of legal tender in exchange for goods and service, but also the provision of services to customer through the Internet. This process also involves collaborating with other enterprises on a number of items over the internet, and teaching or passing of useful information using the same means.
A number of people came to understand the way businesses operate from their experience buying things in the usual traditional offline way which is off line. It is this experience that they bring with them as they begin using the on line system of buying and selling. The increasing use and connection that has been enabled through the Internet, has facilitated trade across the globe with ease. This form of trade is much more than just the electronic exchange of data between individuals as most people would think (Bidgoli 180).
It also involves communication through other means which are not that simple. These include the use of electronic mail and bulletin boards that are electronic. The exchange of data through the use of electronic means was initially meant for the exchange of large numbers of documents between individuals who were involved in trading between themselves. The format of these documents was however standardized and the network used was not private but rather public. This whole business process was automated (Bidgoli 182).
The e mail is a form of communication done electronically in the written form and is less structured. In all this process it is important to mention that the use of the Internet which is of great importance in this form of trading. The Internet refers to interconnected networks which enable different people to exchange information from different parts of the world. This huge connection of individuals electronically through the Internet is possible through the World Wide Web which is a collection of information that is availed on the Internet.
This process is not as simple as it seems, it involves many other things such as communication between different companies and the communication that goes on within the organization itself. Thus the trade that can be done electronically could be between a business to a consumer, one business to another and finally a business to an employee.
The trade that is electronic can also be carried out not only using the Internet, but also in other networks that are private. Included in this category are networks that are local, value added networks and even within the same computer. The use of a single machine in e commerce can be seen for example in the machines used for vending and for payments made using smart cards or by the use of cell phones (Van Duyne, Landay and Hong 77).
The implementation of the electronic system of doing commerce could be in several forms in the operations of a business. All this depends on how much of the digitization has been included in the operations of the business.
This could be in the need to satisfy aspect of the business, which is the product or service, the way in which the business carries out its operations and finally how their product or service gets to the individuals intended that is the client or consumer. A few organizations have got all the three aspects of their businesses digitized. For example the buying of an electronic book from an on line store such as Amazon (Stair, Reynolds and Reynolds 65).
The difference in the traditional businesses and the electronic ones, is that the latter are virtual while the former actually exist physically which is referred to as brick and mortar. However some companies have got both aspects of the business for example Walmart which has got an on line store and can thus be called click and mortar.
Much of the business for such companies is however done in the traditional way. For a long time now, the airline industry has been a trailblazer in the use of technology in the operations its business. The reservation system that utilized computers made it possible for these companies to tell passengers the seats that had not been booked. This system began in the year nineteen sixty two.
The pioneer in this system was the American operator Sabre. The following years saw the other companies in the industry follow suit. This system enabled an enhancement in efficiency as the amount of money generated could easily be tracked through the system (Stair, Reynolds and Reynolds 70).This was possible due to the system’s ability to record information on the amounts that passengers paid.
As the system went on to the year nineteen seventy eight, the companies that offered air travel were able to offer many types of fares. Their reason for doing this was so in order to maximize their profits from the variety of travelers were ready to pay for different amounts. In many instances it is the individuals who had the urgency to travel who were willing to pay more.
This group included for instance businessmen (Stair, Reynolds and Reynolds 71).It is this kind of traveler with a fixed schedule that the airlines wished to capture with their own kind of charges.
This method of reserving of airline tickets was however not without its challenges. In the nineteen eighties the different types of automated ticketing, owned by the different airlines. The airlines concerned in this case included American, Delta and United. Their systems were known as Sabre, Delta and United respectively.
Since these were the only companies that owned such systems, whenever a travel agency used any of the systems to check for available spaces, it is the company that owned the system which was considered first. It did not matter whether their type of travel package was the one most preferred by the customer or not. However this was later taken care of by laws that sought to promote fare trade (Burrow, Everard and Kleindl 95).
As time went by and the nineteen nineties began, the aviation industry operators implemented the method of selling tickets and other services on line. At this point in time, they had the background knowledge gained through the electronic data collection that they had established. The infrastructure that could be used in this new method of selling was also available from the mainframes that had already been acquired.
This meant that the new system would encounter very few problems. The information about the available flights would for once be available for everyone and not limited only to the travel agencies, the airline or by making a phone call. The increase in the use of this new method has been impressive, if we are to take the example of delta airlines, which has achieved an eight percent growth in the number of tickets sold on line for the period between nineteen ninety six to two thousand and one(Burrow, Everard and Kleindl 98).
Today the aviation industry players are encouraging more and more people to use this method in their transactions. In an effort to achieve this, airlines are using a number of methods. There are a number of incentives that they are offering for those who make their ticket purchases on line, for example the cheapest fares can be bought using only this mode. Some have even resorted to surcharging customers who use the phone for making their purchases.
A number of things can be done on line by the customer, they are the checking and printing of boarding passes, notifications sent through short message text concerning the cancellation or delay in a flight (Burrow, Everard and Kleindl 120).There is much more that is expected from the electronic mode of conducting business, in as much as certain users of services may not like them.
Among some of the electronic commerce concepts that began in the airline industry include the exchange of business information electronically from one business to the other. This information could also be shared in the industry as a whole among the other players.
Through the use of this information that was provided, much research on the appropriate methods of carrying out operations in the aviation industry was made. For example as from the year nineteen eighty five to eighty three, aviation industry operators got data from shopping outlets to determine the probable demand for service in the industry and the likely choice of consumers. This they achieved by using simulations of some of these situations using information got from the Internet (Hanson 85).
Even though the airlines may choose electronic commerce as their most preferred mode of transaction, they have to understand that many things especially technology have got their own ups and downs. Many of the models that are available for use by airlines have got a number of limitations if we are to look at their benefits later.
One of these is the needs for the targeted user who is the customer; these needs are not usually well addressed. Another shortcoming of these electronic commerce systems available have got much data that is yet to be processed into information, thus it may take some time to process this information in case it is needed.
The systems are limited in the ways in which they could be utilized to minimize costs and bolster profitability, if competition from other industry players with similar product offering is to be encountered. These systems have just created a platform for the customers to air their needs, in the process the actual requirements of the customers are not effected as they may desire (Hanson 97).
It is important to note however that these electronic commerce systems have resulted into advantages that surpass their short comings. For example they are available for access by the customer at any time. This can be interfered only by issues that are usually out of the control of this system such as the speed of the network being used, and the number of people using it. In this way individuals keen on being served can access the service at their own convenience.
Secondly, the technology in use for this kind of network is large scale and of a low cost which justifies its use and improves competitiveness. Since it is a network of worldwide inter-connection, the airlines can access information from all parts of the world concerning customers. As a result of their digital nature, the electronic commerce systems provide ease in the transmission, storing and processing information among many other things that can be done to information (Hanson 100).
Much of the information in the electronic commerce can be availed in a number of ways which is advantageous. Through the use of the Internet electronic commerce systems are now more interactive. Individuals in both ends of the transaction are able to communicate in a more personal way.
Through electronic commerce, there is an increase in the amounts of sales that have been made directly, since the hours of accessibility customers are increased. Research concerning what the customer needs and even habits can be got from information available from the electronic commerce systems.
The electronic commerce systems also enables the generation of cash for the business through adverts and sponsorship arrangements for other organizations. Finally there is the integration some of the airline’s operations as a result of the electronic commerce systems, this is enabled through a single process that enables the customer to acquire information(Hanson 120).In this way the airlines can get information by going through a single step.
Many organizations have got different principles that they use in their commerce operations. In this essay the business that will be examined is Air Canada. This business which is state owned and is in the aviation industry is among the companies that we can call click and mortar. In this sense it also has got the traditional aspects of doing business in its operations.
Taking a look at some of these principles, they include, having their websites in languages that all their prospective customers in Canada can understand. This is because people from Canada speak two distinct languages and they are found in different regions of the country. Their other principle is to ensure that all the information that is provided in their website is up to date.
The accuracy of their website has also to be maintained to the highest standards. Their website only uses sources of information that can be categorized only as primary. All the individuals who are in charge of updating this website that is used in the electronic commerce business have to adhere to the standard practices of updating websites. In this electronic commerce website, aspects of social media such as face book and twitter have been incorporated.
These social media queries related to the company can be found in the respective social media pages (Van Duyne, Landay and Hong 89).The management of Air Canada’s electronic commerce site is considered a daily project and new ways of improving it are sought each time.
Another principle that is being used in the Air Canada electronic commerce website is that the advertisements that have been used in it have been kept to a minimum. This site is also user friendly, as it makes provisions for the searching of particular aspects of the customer’s transaction, for example the place they reside in, their age and even country of residence.
Also included are the keywords they can use to search for their queries in the website. The customers are also not forced to enter a code for promotional services but rather this is left optional. This is courteous to the customers who use this site and do not have the time or concern to participate in the other activities of the business such as promotions.
Other support services for the airline travelers have been included in the site, for example that for hotels, cars and vacations. This is very helpful for that traveler who may need this information. Included on the electronic commerce website is the segment for the news that concerns the company .This has been the principle of declaration since anything new happening in the company will be known by anyone who views the site to conduct business (Van Duyne, Landay and Hong 100).
Some of the principles used in the making of the site are however not good for the company. Some of what can be considered to be negative information appears hidden, which could make some of the customers suspicious. Some of this news includes flights that have been cancelled and advisory warnings on where to travel.
There is also some important information that has been put in very small print at the bottom of the page, for example information on the routes that people like the most, and that concerning the terms of service of the airline. There are some changes that can be made to this Air Canada electronic commerce site to improve it further, not to say that it is not good enough.
Some of the changes needed includes; increasing its futures on the social media such as face book and twitter so that it can become more interactive, rather than having to go back to the face book page. To enable its users know the personnel they are talking to about a problem with the services of the company. Finally the site does not provide for the inputting of information on the gender and name which could make the analysis of data from this site difficult (Stair, Reynolds and Reynolds 90).
As with all other sectors and industries there are ethics that govern the way the electronic business is done. These are not just stringent measures, but rather practical rules and regulations that when adhered to, would be fair play in this sub sector. Injury to a number of people can be caused if we do not follow the ethics required of us.
Since much of the electronic commerce is done on the web with actual physical contact, it is important that some level of trust is gained by most users of this method used for carrying out business transactions. Some of the activities that can be considered to be unethical in electronic commerce could include, getting information that is of a personal nature from the consumers.
The other could be unsolicited advertisements on a customer’s browser without their authorization. Deals or promotional offers that are not real and which mislead customers into buying goods from a particular site are another example of an unethical practice in the electronic commerce industry. The forgery of e mails so that the sender can gain the buyer’s trust into entering a transaction with them is also not ethical.
Electronic mail addresses forged are those that are known to be trust worthy to most individuals. Finally, another unethical practice in the field of electronic commerce the making of fake websites that imitates another that is well known and trusted to enable the proponent gain other people’s user names and passwords. This is also known as the hijacking of the URL (Campbell and Woodley 87).
Conclusion
Electronic commerce is an important aspect of business in the world. It is critical in the achievement of a globalised world. A company would thus benefit by paying attention to this aspect of its business because it is the future. Changes made by it in this aspect could make it or break it in the future.
Works Cited
Bidgoli, Hossein. Electronic commerce: principles and practice. New York: Academic Press, 2002.
Burrow,James, Kenneth Everard and Brad Kleindl. Business Principles and Management. New York: Cengage Learning, 2007.
Campbell, Dennis and Susan Woodley. E-commerce: law and jurisdiction. New York: Kluwer Law International, 2003.
Hanson, Ward. Principles of internet marketing. Los Angeles: South-Western College Pub, 2000.
Stair, Ralph, George Reynolds and George Reynolds. Principles of Information Systems. New York: Cengage Learning, 2009.
Van Duyne, Douglas, James Landay and Jason Hong. The Design of Sites: Patterns for Creating Winning Web Sites. New York: Prentice Hall Professional, 2007.