Advantages and Disadvantages of the Information System as a Result of the Globalization of Business

globalization-of-businessManagement information systems are used by organizations to track, store, handle and distribute appropriate information to people when needed. Information management systems support business decision making by providing management with critical data. They are destined to improve communication within the organization, reducing human labor, supporting the short and long term objectives of the business and distribution of complex information.

Electronic commerce, commonly known as e-commerce, being trading or facility when it comes to marketing of products or services using computer networks such as the Internet. Electronic commerce is based on technologies such as mobile commerce, electronic remittances, management of the supply chain, marketing and internet by processing online transactions, electronic data interchange(EDI), systems of management through inventory, and automated data collection systems. Modern electronic commerce, typically uses the World Wide Web for at least a part of the transaction lifecycle, although it can also use other technologies such as e-mail.

E-commerce business can use one or more operations

– Online shopping web sites for retail sale directly to consumers;

– Providing or participating in online markets;

– Business-to-business buy and sale;

– Collecting and using demographic data through web contacts and social media;

– Business-to-business electronic data interchange;

– Marketing for potential cliens planned by email or fax;

– Commitment for launching new products and services.

Electronic commerce can be defined as the entire set of processes supporting business activities of a network also involving and analyzing information. These activities run product

information and display events and providers’ services, consumers of advertising, transaction support, brokering systems for a variety of services and activities, transactions security, user’s authentication, etc.

There have been several similar electronic technologies in the past, for example, electronic data interchange (EDI) and electronic funds transfer (EFT), used for over 20 years. While many of these trading electronic technologies had as radical effects in their own markets and created their fair share of publicity, none has attracted its explosive level to be approved by suppliers in recent years of economic transformation to the extent that e-commerce was appreciated.

Electronic commerce saw a boom due to the convergence of these technological developments, the telecommunications provider and the computing industry, and the business climate. A pervasive digital infrastructure provides an effective means of communication and information exchange that presents an extremely attractive environment to the new e-commerce.

Electronic commerce involves multidisciplinary problems, both technical and non technical. They are of a complex nature and they significantly overlap with each other. Technical research issues overlap with other areas of technical research. For example, finding and filtering information is a fundamental requirement of a system of electronic commerce, but it can also be a service as important for a digital library.

The objectives of e-commerce are involved in increasing the speed and efficiency of operations and business processes, and improving customer service. Also e-commerce should:

– reduce total costs through a more competitive process;

– contribute to a decrease in the duration of production cycles;

– allow businesses to operate with remote partners, in the same way that it does with adjacent partners;

– create new services and businesses;

– help to expand the horizon of participants.

Unlike emerging areas of electronic commerce stalled in the same form for about 20 years, with positive and negative effects of EDI (electronic data interchange) industrial structures have positive effects. A real cost-benefit analysis of the effects may be difficult to assess, however, costs are easier to quantify than the benefits. Reducing staff costs for data entry and shortening collection cycles are all measurable benefits needed in order to configure and maintain the implementation of traditional EDI.

E-commerce in the United States is regulated by the Federal Trade Commission (FTC). Carrying out these activities include the use of commercial e-mails, online advertising and consumer privacy. CAN-SPAM Act of 2003 establishes the national standards for direct marketing via email. Federal Trade Commission regulates all forms of advertising by this act, including online advertising and requires advertising to be truthful.

In Australia, there are guides that offer tips on electronic commerce, regulate and give advice about online business, give specific recommendations in case things go wrong.

In China, electronic commerce regulations also mark its entry into the stage of rapid development by legislation on electronic commerce.

Modern electronic commerce involves everything, from ordering “digital” content for immediate online consumption, for ordering conventional goods and services, to services of “meta” to facilitate other types of electronic commerce.

In addition to traditional e-commerce, it has also been used the m-commerce (mobile commerce) term and t-commerce.

In 2010, the UK had the largest e-commerce market in the world, that being measured as the amount spent per inhabitant.

Since 2013 the Czech Republic was the European country to which ASP provides the largest contribution to total revenues. Almost a quarter (24%) of the country’s total turnover is generated through the online channel.

Among emerging economies, China’s presence in e-commerce continues to grow each year. With 384 million Internet users, China’s online shopping sales increased to $ 36.6 billion in 2009 and one of the reasons behind the enormous growth has been the increasement in the level of confidence for buyers. Chinese retailers have been able to help consumers feel more comfortable about online shopping. E-commerce transactions between China and other countries have increased by 32% to 2.3 billion yuan ($ 375.8 billion) in 2012 and accounted for 9.6% of China’s international trade. In 2013, Alibaba had a market share of 80% of e-commerce in China, according to the research done by a firm based in Beijing.

Transactions made mostly by overseas companies through online orders made in China, accounted for 95% of cross-border trade and Chinese consumers often buy from external websites.

The market continues to grow at high speed and will reach 6.5 billion yuan ($ 1.1 trillion) by 2016, representing 19% of total import and export volume in China. E – retail is about 5% of cross-border e – commerce total in 2012, which is 115 billion yuan ($ 18.8 billion).

More than 90% of cross-border e-commerce transactions in 2012 were exports from China to other countries. US acquired most goods from China (17.2% of total), including both purchases by businesses and by consumers. Europe was next with 16.3%, followed by Hong Kong (15.8%), South Asia (10%), Japan (7.4%), Korea (4.3%) and India (2.3 %). The most popular categories of cross-border e-commerce include electronics, sportswear, etc.

Regarding cross-border electronic commerce, a big part comes from Chinese customers by ordering from websites. Many of these buyers are young adults with relatively high income living in cities. The shopping frequency is low, but buying costs are high. Chinese consumers often buy electronics and luxury goods from online retailers.

The researchers published their estimates of sales on online retail in China compared to overseas buyers. Some Chinese companies have started to sell online for buyers from other countries, including sites operated by US.

In Brazil in 2013, e commerce has been growing rapidly, and retail sales grew at a healthy pace, doubling the turnover in 2014. By 2016, it is expected that Brazilian retail e-commerce

sales will reach $ 17.3 billion.

E-commerce in Brazil has increased steadily, fueled by the growth of the Internet and an increase in incomes of the population according to a new e-marketer report. Brazil’s economy slows, but sales of electronic commerce should be twice as large as the turnover this year, knowing that in 2016 will be the FIFA World Cup football tournament which stimulates the growth of domestic tourism and economic activity related to the event.

As in other countries, sales of digital travel played a major role in the development of e-commerce in Brazil. The trip represented almost a third of the total e-commerce sales of the country in 2012. The volume size was given in Brazil by the fact that air transport is needed to get from one place to another place, flights being expensive.

Digital travel sales in Brazil in the 2011-2016 period are estimated to be growing. In 2011 the income from e-commerce recorded 32.8% accountig for $ 13.8 billion. In 2012 the income from e-commerce has registered 21.9%, representing $ 16.27 billion, which is a decline. In 2013 the income from e-commerce has registered 16.5%, which is still declining, representing $ 19.26 billion. In 2014 the income from electronic commerce has registered 19.1%, decreasing and representing $ 23.53 billion in absolute amount.

In 2016 is expected a much higher volume decline of ecommerce revenues to 6.9% of foreign trade, representing $ 27.30 billion. From this analysis we found that the percentage total sales volume in electronic trade declined, while revenues have recorded a significant increase as we see in the figure below.

Although not as fast, it has been recorded an increase in sales in e-commerce and travel. Retail e-commerce sales in Brazil are likely to be growing at a healthy pace twice the 2014 turnovers. By 2016, e-marketer expects sales through ecommerce retailers to reach $17,3 billion. Retail sales will grow by using a greater number of Internet users who buy through digital channels. E-Marketer estimates that Brazil will have 26.7 million digital buyers in 2016, equal to 36% of internet users.

A study conducted by an institution of higher education stated that the middle class will represent 60.2% of the population of Brazil which seeks trading through e-commerce by 2016, at which time the group should include more than 120 million people. Several middle-income consumers will access more on the digital part and online retailers can expect to have more purchases made at much lower prices. The growing number of online buyers with average incomes also suggests that shopping will spread among consumers in Brazil and will increase further with time.

India has an internet users’ base of over 243.200.000 since January 2014. UserBase is the third largest in the world and despite the fact that internet penetration is low compared to markets in the United States, Great Britain or France, it is growing at a much faster rate, reaching around 6 million new customers entering each month. In India, the cash on delivery payment method is the most preferred, accumulating 75% of retail activities.

Worldwide, e-commerce has become an important tool for small and large enterprises, not only for selling to customers, but also to engage them.

 

Figure no. 1. E-commerce sales growth in 2011-2016 period

 e-commerce

Source: Author processing

 

Table no. 1.Advantages and disadvantages of the information technology

 

Some of the advantages of the information technology Some of the disadvantages of the information technology
Globalization – IT has not only brought the world closer together, but allowed the global economy to become a single interdependent system. This means that you can not only share information quick and effective, but it can also reduce barriers between linguistic and geographical boundaries. The world has become a global state with the help of information technology, which allows countries Chile and Japan, separated not only by distance but also by language to put into action the ideas and exchange information between them.

Communication – Using the information technology, communication has also become cheaper, faster and more efficient.

Reducing the cultural gap – the information technology has helped reduce the cultural gap, helping people from different cultures to communicate with each other. It has facilitated the exchange of views and ideas, so that it has led to raising awareness and reducing operating expenses.

Time – It made it possible for companies to be open 24 hours across the globe. This means a business that can be opened anytime and anywhere, making purchases from different countries much easier and more convenient. This also means that we can have goods delivered right to our door.

Creating new jobs – probably the best advantage offered by the information technology is the creation of new and interesting jobs. Programmers, analyzing systems, hardware machines, software developers and web designers are only a few of the many new jobs created with the help of the IT industry.

Unemployment – while the information technology can be simplified the created business process leads to job layoffs. This means that a lot of jobs of a low and medium level have caused the unemployment of many people.

Privatization – the information technology can be done for a faster, easier and more convenient communication to buy in confidentiality.

Lack of job security – industry experts believe that the internet has made job security a problem, due to the vast technology development, felt every day. This means that staff must adopt a lifelong learning, to be sure of job retention.

Source: Author processing

 

In 2012 e-commerce sales have exceeded $ 1 trillion for the first time in history. Mobile devices play an increasingly important role in the mix of e-commerce. In 2014, an estimate of the purchases made on mobile devices valued 25% of the market by 2017.

In 2014, it has been recorded a total of 600 million Internet users in China, twice more than in the US, making it the largest online market in the world.

In order to be successful an implementation of electronic data exchange, must be the direct cause of improvements in productivity and in internal operations, to create closer relationships with suppliers and customers, providing a competitive advantage on the market in opening the procurement process.

Dinu Octavian Nicolescu Assistant Lecturer and

PhD Candidate at Valahia University in Targoviste

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