Turban- 3e
Instructor’s Manual
Chapter 11
EC STRATEGY AND IMPLEMENTATION:
JUSTIFICATION, GLOBALIZATION, SMEs,
AND REGULATORY AND ETHICAL ISSUES
Learning Objectives
Upon completion of this chapter, you will be able to:
1. Describe the strategic planning process.
3. Describe EC strategy implementation including the use of metrics.
4. Describe the need for justifying EC investments, how it is done, and how metrics are
used to determine justification.
5. Understand the difficulties in measuring and justifying EC investments.
7. Analyze the impact of EC on SMEs.
9. Explain privacy, free speech, and defamation and their challenges.
11. Describe the importance of green EC and the major issues of concern.
12. Describe the anticipated future of EC.
Content
E-Strategy
11.2 Justification and Cost-Benefit Analysis
11.3 Difficulties in Measuring and Justifying E-Commerce Investments and Success
11.4 Global E-Commerce
11.6 Intellectual Property and Other Regulatory Issues
11.7 Ethics in E-Commerce
11.8 Privacy, Violation and Protection, and the Conflict with Free Speech
11.10 The Future of Electronic Commerce
Managerial Issues
Closing Case: Why Is Disney Funding Chinese Pirates?
Chapter 11
Page 2
Supplementary Videos for this Chapter
1. What every Businessperson should know about E-Discovery (9:11 min)
A tutorial about e-Discovery. Description of the process and the possible benefits when
Chapter 11
Page 3
Answers to Pause/Break Section Review Questions
Section 11.1 Review Questions
1. What is strategy?
2. Describe the strategic planning process.
The process is a cycle of assessment, initiation, formulation, and implementation.
3. Describe the four phases of strategic planning.
4. What is a business plan?
5. What is a business case? How is it different from a business plan?
6. Describe the process of deriving an EC strategy.
7. Describe issues in using Web 2.0 and social networks in EC strategy.
According to Ward and Peppard (2002), strategy setting begins with the business
Chapter 11
Page 4
Section 11.2 Review
1. List some of the reasons for justifying an EC investment.
2. Describe the risks of not conducting an EC justification study.
3. Describe how an EC investment is justified.
4. List the major EC investment categories.
One basic way to categorize different EC investments is to distinguish between
investment in infrastructure and investment in specific EC applications. Major categories
can include:
5. When is justification of EC investments unnecessary?
6. What are metrics? What benefits do they offer?
Chapter 11
Page 5
Section 11.3 Review
1.List the major difficulties in measuring costs, benefits, and success of EC.
2. Describe product characteristics in EC.
3. What are industry characteristics in EC?
4. What are seller characteristics in EC?
5. What are consumer characteristics in EC?
Section 11.4 Review Questions
1. Describe globalization in EC and the advantages it presents.
2. Describe the major barriers to global EC in each dimension of the CAGE framework.
3. What can companies practicing global EC do to overcome the barriers to global EC?
Section 11.5 Review Questions
1. What are the advantages of EC for small businesses?
2. What are the disadvantages or risks of EC for small businesses?
3. What are the CSFs for small businesses online?
4. How can one support EC in a small company?
Section 11.6 Review Questions
1. Why are laws subject to interpretation?
2. Define intellectual property.
3. Define personal and property rights.
4. Define copyright.
5. Define civil laws.
6. Define DRM. Describe one potential impact on privacy.
7. Define patents and relate them to EC.
Section 11.7 Review Questions
1. What does business ethics define?
2. Give an example of an EC activity that is unethical but not illegal.
3. Identify an employee activity that exposes a company to legal risk.
Student responses will vary.
4. List the major issues a code of ethics should include.
Chapter 11
Page 8
Section 11.8 Review Questions
1. Define privacy.
2. How is privacy colliding with free speech?
3. List some of the ways that the Internet can be used to collect information about
individuals.
4. What are cookies and spyware, what do they have to do with online privacy?
5. Describe the P3P privacy platform.
6. List four common ethical principles related to the gathering of personal information.
7. How does the USA PATRIOT Act expand the government’s reach?
Section 11.9 Review Questions
1. Define green computing. Why is it so important?
2. Describe the problems related to green computing, particularly in regard to data
centers.
3. Describe some solutions to green computing.
4. What is the purpose of global green regulations?
Section 11.10 Review Questions
1. Discuss the integration of marketplaces and marketspaces.
2. Describe mobile social networks.
3. List the major potential inhibitors of e-commerce.
Answers to EC Application Case Questions
EC Application Case 11.1: Strategic Planning at InternetNZ
1. Why would a nonprofit organization such as InternetNZ need a strategic plan or a
business plan?
2. What is the difference between a vision statement and a mission statement?
Chapter 11
Page 10
EC Application Case 11.2: Pierre Lang Expands Into Eastern Europe
1. Why was it necessary for Pierre Lang to look at fundamental changes in its business
model and information systems?
2. What have been the results of implementing mySAP at Pierre Lang?
3. Why is security so important to the company and how is it protected?
4. Enter fortinet.com and examine the capabilities of their FortiGate products.
EC Application Case 11.3: Is eBay a Store or a Bullentin Board?
1. In your opinion is eBay a store or an electronicboard? Why?
Students will have different opinions.
2. Can such conflicting court decisions happen in the same country? Why or why not?
3. Why is it said that a corporate strategy can help an EC vendor?
Students will have different opinions.
4. Some say that the jewelers are suing eBay because it interferes with their illegal price-
fixing practices. Comment on this issue.
Students will have different opinions.
Chapter 11
Page 11
Answers to Individual Discussion Questions
1. How would you identify competitors for a small business that wants to launch an EC
project?
2. How would you apply Porter’s five forces and Internet impacts to the Internet search
industry?
Student answers will vary.
3. Why must e-businesses consider strategic planning to be a cyclical process?
4. Discuss how writing an e-business plan differs from writing a traditional business
plan. (See the Online Tutorial.) Discuss the pros and cons of going global with a physical
product.
5. Find some SME EC success stories and identify the common elements in them.
Student searches and results will vary.
6. Enter businesscase.com and find material on ROI analysis. Discuss how ROI is related
to a business case.
7. What are some of the things that EC Web sites can do to ensure the safeguarding of
personal information?
8. Discuss the insufficient protection of opt-in and opt-out options. Which method do you
prefer?
Student opinions will vary.
Chapter 11
Page 12
Answers to Class Discussion Questions
1. A company is planning a wireless-based CRM system. Almost all the benefits are
intangible. How can you justify the project to top management?
Student answers will vary.
2. Privacy is the right to be left alone and free of unreasonable personal intrusions. What
are some intrusions that you consider “unreasonable?”
Student opinions will vary.
3. Discuss what the RIAA hopes to achieve by using lawsuits (civil law) against college
students for copyright infringement.
4. Many hospitals, health maintenance organizations, and federal agencies are
converting, or plan to convert, all patient medical records from paper to electronic
storage (using imaging technology). Once completed, electronic storage will enable
quick access to most records. However, the availability of these records in a database
and on networks or smart cards may allow people, some of whom are unauthorized, to
view another person’s private medical data. To protect privacy fully may cost too much
money or may considerably slow the speed of access to the records. What policies could
health care administrators use to prevent unauthorized access? Discuss.
Student opinions will vary.
Internet Exercises
(Note: URLs may change over time; please check the Internet Exercises on the
Turban Web site for possible updates: www.pearsonhighered.com/turban.)
1. Enter digitalenterprise.org and find Web metrics. Read the material on metrics and
prepare a report on the use of metrics for measuring advertising success.
Student reports will vary.
2. Visit website101.com and find some of the EC opportunities available to small
businesses. Also, visit the Web site of the Small Business Administration (SBA) office in
your area. Summarize some EC related topics for SMEs.
Student reports will vary.
3. Find out how Web sites such as tradecard.com facilitate the conduct of international
trade over the Internet. Prepare a report on your findings.
Student reports will vary.
4. Use a currency conversion table (e.g., xe.com/ucc) to find out the exchange rate of
$100 (U.S.) with the currencies of Brazil, Canada, China, India, Sweden, the European
Union, and South Africa.
Student reports will vary.
5. Conduct research on small businesses and their use of the Internet for EC. Visit sites
such as microsoft.com/smallbusiness/hub.mspx and uschamber.org. Also, enter
google.com or yahoo.com and type “small businesses + electronic commerce.” Use your
findings to write a report on current small business EC issues.
Student reports will vary.
6. Enter businesscase.com and review their products. What are the benefits of
CaseBuilder to people conducting e-commerce strategy development?
7. Enter languageweaver.com and find the product they have for language translation.
Student reports will vary. The firm offers a variety of automated translation options.
8. Enter alinean.com and find information that explains Alinean’s approach to measuring
return on IT. You can download two free e-books from the site that relate to this chapter.
Summarize your findings in a report.
Student reports will vary.
9. Enter nucleusresearch.com. Go to “Research,” search for the file titled “Market
Scorecard: Hosted CRM” for a review of hosted CRM vendors. Summarize your findings
in a report. (Note: Use Google to find this information.)
Student reports will vary.
10. Go to google.com and search for articles dealing with the ROI of RFID. List the key
issues in measuring the ROI of RFID.
Chapter 11
Page 14
11. Enter citrix.com, sharkfinesse.com, and search
marketing.yahoo.com/calculator/roi.php. Review their calculators. Write a report.
Student reports will vary.
12. You want to set up an ethical blog. Review “A Bloggers’ Code of Ethics” at
cyberjournalist.net/news/000215.php. Make a list of the top 10 ethical issues for
blogging.
Student reports will vary.
13. Use google.com to prepare a list of industry and trade organizations involved in
various computer privacy initiatives. One of these groups is the
World Wide Web Consortium (W3C). Describe its Privacy Preferences Project
Student reports will vary.
14. Download freeware from junkbuster.com and learn how to prohibit unsolicited e-
mail. Describe how your privacy is protected.
Student reports will vary.
Team Assignments and Role Playing
1. Have three teams represent the following units of one click-and-mortar company: (1)
an off-line division, (2) an online division, and (3) top management. Each team member
represents a different functional area within the division. The teams will develop a
strategy in a specific industry (a group of three teams will represent a company in one
industry). Teams will present their strategies to the class.
Student reports will vary.
2. The relationship between manufacturers and their distributors regarding sales on the
Web can be very strained. Direct sales may cut into the distributors’ business. Review
some of the strategies available to handle such channel conflicts. Each team member
should be assigned to a company in a different industry. Study the strategies, compare
and contrast them, and derive a proposed generic strategy.
Chapter 11
Page 15
Student reports will vary.
3. Each team must find the latest information on one global EC issue (e.g., cultural,
administrative, geographical, economical). Each team will offer a report based on their
findings.
Student reports will vary.
4. Survey google.com and isworld.org to find out about EC efforts in different countries.
Assign a country or two to each team. Relate the developments to each country’s level of
economic development and to its culture.
Student reports will vary.
5. Compare the services provided by Yahoo!, Microsoft, and Website Pros Inc. to SMEs
in the e-commerce area. Each team member should take one company and make a
presentation.
Student reports will vary.
6. Enter whatis.techtarget.com or similar resource sites. Read about spam and splogs.
Find out how spam and splog filters work (also see ironport.com and other vendors).
Prepare a report and class presentation.
Student reports will vary.
End–of-Chapter Real-World Case Questions: WHY IS DISNEY
FUNDING CHINESE PIRATES?
1. Why is it difficult to stop pirated copyrighted material from showing up on the
Internet?
2. Why aren’t copyright laws useful in this situation?
3. Why has Disney invested in 56.com?
Chapter 11
Page 16
4. Why isn’t Disney fighting with 56.com?
5. Identify the legal issues in this case.