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Unit 4: Electronic Commerce and the Digital Organization

Notes
Figure 4.2: Business-to-Business Business Models

4.4.3 Systems for Improving B2B E-Commerce

Business-to-business e-commerce is still in a state of flux as enterprises learn how to leverage
information technology in general and the Internet in particular into systems that help them
more efficiently and effectively does business. Observers are looking at several.
 First, to make business-to-business e-commerce worthwhile, systems need to evolve to
handle not only simple transactions but complex ones as well. To facilitate this need,
standards will need to be developed and put into place.
 In addition, as markets become more competitive, transaction fees will most likely decrease
or even disappear. Among other implications, this means that providers will need to shift
from dealing in transactions to offering more comprehensive solutions to business needs.
For example, products can be bundled with related information and services in an effort to
forge customer loyalty and long-lasting relationships.
New business-to-business models will continue to appear as technology continues to evolve
and enterprises seek creative solutions.
Among new business-to-business e-commerce models that are beginning to emerge are the
mega exchange that maximizes liquidity and sets common transaction standards, the specialist
originator that deals with complex and relatively expensive products, the e-speculator model
that has a high degree of product standardization and moderate to high price volatility, the
solution provider in which product costs are only a small portion of the overall costs, and the
sell-side asset exchange with high fixed costs and a relatively fragmented supplier and customer
base.

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