Business Skills for E-Commerce: Monster Cookie - Assignment Example

 Business Skills for E-Commerce: Monster Cookie 1. Structure & Aim of Business Organization 1.1 Core Functions of MCC & Impact on the E-Commerce Site Monster Cookies (later referred to as MCC in this essay) is a small cookies manufacturer that employees around 25 employees. They manufacture various shapes and sizes of cookies, in different colors as an attraction for the customers. MCC generates sales by supplying to the high street shops. The core function of the business is manufacturing cookies. Manufacturing cookies is a specialized core business function, and it can be safely assumed that the 25 workers employed at MCC are related to this core operation. On the other hand e-commerce is a specialized activity in itself, requiring unique expertise not just pertinent to basic information technology but much beyond. Prior to discussing the requirements of e-commerce, the most fundamental point is the application of e-commerce i.e. where does it apply? According to Erickson (2009), the enhancement of IT over the years has moved the world from a room size computer to a hand held and laptop, and made the internet so much accessible and viable that it’s everywhere now. These enhancements have led to the advent of e-commerce. Brennan (2002) states that these initiated from B2B (Business to Business), moving to the B2C (Business to Consumer) setup, and finally having its routes in C2C (Consumer to Consumer) businesses as well – showing that virtually everything can be traded. A number of businesses use e-commerce as the whole and sole mode of interacting with their clients. There are e-commerce consultancies all over the world that facilitate the process of firms going online for their trading activities. Adding e-commerce to the organizational functions would be similar to adding a whole new function to the organization. It would need a new team altogether with a vision along the lines of the organizational vision at present. However, prior to this, there needs to be estimates and forecasts pertinent to the expected enhancement of sales. Accordingly, more staff needs to be recruited to ensure that any jump or spike in sales figures is not missed due to lack of capacity. 1.2 Evaluation of Aims & Co-relation with Stakeholders The aim of MCC is to develop profits with least costs i.e. have cost effective operations. With the intent to enhance sales proposition, the business is planning to grow using e-commerce as their mechanism for extending their business. It relates to the organizational aim for being cost effective, the details of which shall be discussed in the proceeding section of this report. The fundamental proposition or value addition created by e-commerce is extending the reach and richness of a business. In the context of stakeholders, the impact they receive is significant. According to Aaker (2007), there are two forms of stakeholders i.e. the internal and external ones. Internal stakeholders include employees of the organization, and the management. Both, employees and management would have a positive influence to and from this expansion plan because it would not just bring more revenues (management perspective), but also create more jobs and enhance the job scope (employee perspective). External stakeholders include competitors, suppliers, and customers – in a broader sense. For competition, it would be an enhanced value proposition – none of the competitors are into e-commerce at the moment. Thus, it would be a first mover advantage and alongside, if successful, the competition may adapt to similar IT solutions. For suppliers, expansion would imply increased order placements and more sales values; while for the customers, it would imply that MCC becomes virtually very close to the customers, and literally at just a click away. 2. The Impact of E-Commerce 2.1 Impact & Risks of E-Commerce at MCC Doole (2005) states that e-commerce is a growing field in the IT sector today; adding it to the operations is a strategic decision, and may involve significant impacts and risks. Impact, i.e. the influence an e-commerce project may develop on an organization can either be external or internal. Externally, it would invite the competing arena to establish and deploy similar IT solutions, if MCC succeeds at breaking through the market with this solution. Internally, there would be structural changes associated to the deployment of this project. There would be cross functional teams that would assist in analyzing the requirements and proceeding forth with the deployment of the project. There would be excessive workload for the employees but at the same time, it would be beneficial in the long run. For example, the order placement (e-commerce) system can be inter-linked to the supply chain system, reducing work-load and enhancing time-saving propositions. Gale (2006) states, that the deployment of a new system altogether has inter-linked risks involved. The primary risk is the risk of failure; MCC is not a very huge firm, but the investment in e-commerce is definitely on the higher side. MCC needs to write out all possible risks that can lead to failures. Since e-commerce requires extreme automation in the processes, appropriate training of the staff is required to avoid any mishap; this is an indication of strong potential failure. Reluctance of employees is another major risk, because by far the company is not as such technology oriented. At the same time, job threat and job security would also be major risks since the employees are not well versed with technology as such. Mitigation of these risks is extremely critical to ensure successful deployment of the e–commerce project. At the same time, having the right and clear vision about what the organization wants from this project implementation is also critical. 2.2 Global Impact of E-Commerce – MCC’s perspective Grant (2010) states that globally, e-commerce has brought about a new life style altogether for consumers across the world. Not just letting consumers make purchases from the comfort of their homes, e-commerce also removes the restrictions of geographical boundaries allowing cross-border purchases; e.g. many online shopping stores allow delivery all across the world. In a nutshell, e-commerce has brought about comfort to the shopping aspect of consumers. On a broader scale, when referring to B2B (Business to Business) transactions, e-commerce there too plays a significant role as organizations tend to integrate their buying processes using e-commerce technology whereby the process of order placement to delivery and final payment is controlled via the ‘e’ medium. When the impact of e-commerce is studied from the MCC perspective, e-commerce would allow reaching the bigger masses. MCC’s primary model would be online order placement primarily targeting the bulk buyers, re-sellers, and catering community. Non-bulk ordering may not add much of a value to MCC’s business proposition. Currently, MCC caters only to some high-street stores, but once gone online, MCC can enhance its target market and reach out for and explore more revenue generating avenues. If successful, MCC may end up in a major expansion project. 3. An E-Commerce Solution for MCC 3.1 Market Potential E-Commerce is an economical way of offering the products and services to a wide variety of customers. The world of e-com is full of opportunities and potential. Similarly, the e-commerce solution holds tremendous market potential for MCC. Currently supplying to 25 stores, MCC can expand its operations via e-commerce and add value to its customers both at B2B and B2C level. There lies tremendous potential in the market for enhancing the cookies sale. Cookies are fast moving confectionary items, liked and eaten by individuals of all age groups. In particular, there is high potential in the bulk buying sector, whereby catering companies in particular buy various sorts of cookies for various functions; MCC having the unique point of having cookies made in different shapes and sizes, are definite to make an impact in the consumer segment as they have various events like parties, etc. Once MCC goes online, they can advertise their unique point of having various forms and shapes, thus, attracting the consumer base to prefer their cookies, at the same time, spreading the awareness amongst various vendors such as the event organizers, caterers, bakeries, etc. about their differentiating product line. At present, supplying to 25 stores is a very small number – there is a huge potential that is still untapped. 3.2 E-Commerce amongst Competition At present, competing brands are not using e-commerce system, while most competitors have their own websites and portals for displaying their products. These portals and webs are in turn serving as an advertising medium or a portfolio of products provided by these competitors. Thus, a very basic form of ‘e’ solution is present with the different competitors; however, none have a strong and complete e-commerce solution implemented. 3.3 An E-Commerce Solution for MCC At present, based on the capability and capacity of MCC, the business should not go for an extremely advance e-commerce solution to start of with. On the contrary, MCC should start off with a simple website or a portal that provides details about the business and its portfolio of products, along side prices if need be. Once established and awareness is spread, likewise amongst the competition, MCC can use this portal or website as a strategic marketing tool, and later add the e-commerce functionality to the same. The initial step involved would be establishing requirement analysis at an initial stage; the management needs to sit and analyze what exactly are the requirements. As a second stage, they would hire a professional e-commerce developer through their contacts or invitation for bids or request for quotation via newspapers and other media. Then there is the requirement analysis, prototyping and user feedback steps, whereby the service provider would take the management input about what they want, develop a model, and take the management feedback to revise the product. This cyclic process would continue till the product takes a final shape and is ready to be deployed. The solution or the product would then be deployed at a server, and expertise would be needed at MCC end to take regular care of it in terms of running it and its maintenance. 3.4 Financial Implications of E-Commerce Solution for MCC IT solutions are modular in nature – each module has a cost; the more modules a business adds, the cost increases accordingly. At the initial phase, it is strongly recommended that MCC moves with a basic module approach, as mentioned, deploying web portal and proceeding with its advertisement, and at a later stage, proceeding with e-commerce module for the IT solution. MCC does not need to purchase any extra ordinary software for it – even off the shelf implementation would turn up expensive. For MCC’s requirements, they can easily get a customized e-commerce solution for less than USD 5,000 as a fixed cost, and less than USD 500 as annual maintenance cost. A customized solution would be more viable because it would not just cater to the precise needs and wants of MCC, but at the same time, it would also release the burden of carrying the unnecessary modules of a heavy application and other licensing costs. With this investment or capital expenditure; most of the authors keep investment in IT as a capital expenditures in books of accounts, the business can generate excellent revenues and expand its reach to an unbelievable limit. 3.5 Suitability of E-Commerce for MCC At present, none of MCC competitors have an e-commerce solution deployed in their business, thus, the move made by MCC would be a unique and first mover advantage in itself. At the face of it, e-commerce does not sound a suitable solution to MCC’s expansion plans, however, moving forward, and coming up with a different idea, e-commerce would be a much cost effective solution for MCC to expand its business. The product would itself become very vocal and MCC would definitely yield tremendous profits out of its unique and amazing product line. The key to success would be that MCC does not compromise on its core values i.e. innovatively designed cookies. Conclusion The case above depicts that implementing an ecommerce solution would be a highly viable option for Monster Cookies. The organizations around the world have to face cut throat competition and implementing e-commerce solutions in such competition may prove to be highly advantageous for the organization. References Aaker, D & McLoughlin, D., 2007 Strategic Market Management. European Edition. John Wiley & Sons. Brennan, R., 2002. Business to business markets and marketing research. In America. Wiley, pp. 2-27. Doole, I. & Lowe, R. 2005. International Marketing Strategy. London: Thomson Learning. Erickson, G.S. & Rothberg, H.N., 2009. Intellectual capital in business-to-business markets. Industrial Marketing Management, 38(2), p.159-165.  Gale, B.T. & Swire, D.J., 2006. Value-Based Marketing & Pricing Value-Based Marketing & Pricing. System, (November), p.20. Grant, R., 2010. Contemporary Strategy Analysis: Text & Cases. UK: John Wiley and Sons. Read More