E-procurement Abstract

Illustrate your essay with specific examples.

This report deals with the effectiveness and benefits of e-procurement with supply chain management techniques towards the business goals. E-procurement in SMEs will be evaluated by analysed using some of the strategies and techniques reviewed during this project. The data used for analysing these techniques will be provided by the BCT company which is a UK based small medium sized (SME) company who supplies construction materials. This data will be used as an evidence to justify any conclusions or recommendations made at the end.
The report starts with the basic introduction on management and e-procurement to build the foundation of the project. This is followed with a background to the case study company, which will be used as a focus for the research as it will be used as a tool for evaluating aforementioned technique. The literature review about the management, e-procurement and ERP techniques especially Supply Chain Management, MM (Material Management), CRM (customer Relation Management) techniques and their usefulness are outlined in the next section. The application of these techniques is analysed to get thorough understanding of how they affect a business and its growth prospects. The next part will throw some light on the research business methodologies and outlines their usefulness towards the growth in terms of capital data. This will be followed up by an evaluation of these techniques in terms of how they have helped the companies in excelling their business and achieving its goals.
At the end, some of the recommendations will be provided based on the results, carried out during this project. The answers to some of the problems and questions will also be addressed by the end of this report.

1. What is the E-procurement solution and How is it beneficial to SMEs and why?
2. How ERP, SCM and techniques help is addressing these mentioned issues?
3. How the data was gathered for supporting any conclusions or evaluations made?

“E-Procurement within the Supply Chain in the SME sector- Benefits and Problems”

1. Introduction

1.1 Aim

The aim of this project is to determine the benefits provided by e-commerce solutions paying particular attention to the existing status of, and future plans for e-procurement in the supply chain of SMEs. The project will take a detailed look at the following areas:

1. The methodologies and technologies used for e-procurement.
2. The critical requirements and factors for e-procurement within the SME supply chain.
3. The capabilities of the techniques and tools for implementation in SMEs.

The overall aim of the project is to construct a best practice e-procurement model. This can help to improve the existing methods used by many SMEs. The dissertation critically evaluates potential take-up and evaluates associated issues to provide guidance for further development.

1.2 Problem

There are two problems to be solved by the completion of this project. Owing to the fact of the internet has been as revolutionary as we have been lead to believe, a great number of SMEs all over the world have rushed to establish websites for online retailing. Yet the proven successful ones are only a small percentage. Organisations have been over enthusiastic about the returns that online retailing can bring, and ignored a far more critical aspect of the e-commerce part, the business-to-business (B2B) e-procurement. For instance, E-Business take-up and success in Europe among engineering businesses is low. There are successful, well-documented case studies that demonstrate the level of benefit that can be achieved [1] but considering the level of investment; overall achievement is still relatively modest. For instance, focussing on on-line sales, one of the key means for Small/Medium size Enterprises (SMEs) to benefit from the Internet, the eEurope 2004 benchmarking report admits that “only 14% of SMEs make on-line sales and in only 7% of SMEs do on-line sales constitute more than 5% of their overall sales” [2]. The vast majority of companies still continue to rely on old trusted methods of doing business even though outsourcing to lower cost regions and countries is a major threat to many engineering SMEs in Europe.
PriceWaterhouseCoopers [6] “has indicated that businesses are using e-commerce mainly to communicate more effectively with suppliers they already know”. Only 22 % of companies purchasing on-line choose new suppliers. However, it is increasingly recognised that gaining full benefit from e-business requires companies to transact with partners they have never met [7]. It is very important for engineering SMEs to exhibit a level of capability, confidence and trust that will encourage them to be chosen on-line for supply of their products, but also for partnership in new opportunity ventures.

2. Case Study Background

BCT is a UK based trading company who supplies construction materials including curtain walling and cladding, elevators, marble and granite products, brassware and so on. The products are mainly from China as the purpose of the company is to bring Chinese products and materials into the UK and European market.
Brassware retail is one of the major businesses of the company; currently the company uses the web based online selling platform – eBay as the major retailing channel, and is also developing online retailing over its own website. The eBay platform provides product listing with bidding system and one-off price sale, BCT receives orders and queries from eBay users. Presently the stock control is managed on the base of eBay reports and MS excel. The brassware products are ordered periodically from the supplier in China and a large portion of the products are ordered repeatedly time by time. The order process is handled by a member staff manually sending emails and use phone calls or faxes, and the payments are sent through banks using director signed faxes.
such As for the construction material supply, the product range varies greatly, the company has a number of fixed suppliers who have successfully supplied certain products for a period of time, and for products bought infrequently, they source suppliers through the internet using sourcing sites such as www.alibaba.com or www.chinasourcing.com . Normally the deals are discussed through phone calls and emails with the suppliers, and invoices / orders are sent through emails, and then printed and filed. The same procedures apply to the received orders from construction developers. The transportation of products is separately managed by contacting shipping agents. The order process can often take quite a few days of negotiation with suppliers and sourcing new suppliers can always delay the process. Products are manufactured in China and delivered to the UK, the shipping schedule often gets in the way as it normally takes 25-30 days for containers to arrive to UK, and therefore other delays have to be reduced to minimum. It would be considered helpful to devise a system that can handle the procurement more efficiently and reduce the time and costs wasted on processes, and bring certain automatic processes such as stock control. Some of this information is confidential and thus there may be security or data protection implications of such a system.

2.1 Research Question – Is an E-Procurement system useful in this situation?

There is a question of whether e-procurement systems is appropriate for developing and improve the procurement system. "Research indicates that 40% of the total cost of purchasing materials comes from transaction costs associated with processing and managing the order" (Neef et al., 2001).
However, there are a number of issues that concern the companies regarding the implementation. According to the Price Waterhouse Coopers survey, "the senior business leaders in the UK, Germany, France and the Netherlands, security and truest issues were cited as the most important factor holding back e-procurement progress" (Neef et al., 2001). This makes sense especially in the case of e-procurement of mission critical materials, where issues concerning security and delivery reliability of newly developed suppliers could make buyers hesitate to change the paper-based process conducted with trusted and long-term based suppliers. Thus, does an e-procurement system provide suitable time and cost saving, and reliability; or does it insist on the completion of endless paper-based transactions. It is difficult to find one methodology that exactly suits a project and therefore there is the problem of whether an E-Procurement system is useful especially for SMEs.

3. Literature Review

3.1 Introduction – Procurement Concept

It is very important to find out the fundamental concept of procurement to avoid future misapprehends. Traditionally, corporate procurement consists of direct and indirect procurement. Direct procurement is generally considered that materials purchased are related to the production of finished goods or directly for sales, and the vendors include manufacturers and distributors. These materials tend to be ordered in large volume or periodically, a firm's forecasting and planning capacity seriously affect the accuracy and effect of procurement. For instance a brassware manufacturer would know that they need to buy certain quantities of copper at certain times during the manufacturing process. Machinery manufacturers know they will need switchboxes, wires and other components. And because of the predictability and high volume, direct procurement normally accounts fewer transactions, but can take a great percentage of a manufacturer's total procurement expenditure.
Indirect procurement on the other hand has no direct relationship with the products, the term Operating Resource Management (ORM) is used to describe the daily necessities of a company, such as paper, pens, furniture and other office appliance, or business travels. Another term is Maintenance, Repair and Operations (MRO), which is often used for product replacements or repairing, and relates to a manufacturer's stock system as critical parts cannot be missed at anytime during the manufacturing process, thus safety stock of those parts may have to take place. In general, indirect procurement is materials that tend to be low cost and can be purchased frequently and in high volume. In most companies, indirect procurement accounts a large proportion of the company's transactions.

3.2 Why E-Procurement?

Since the entering of B2B e-procurement, the traditional difference between direct and indirect procurement began to blur. E-procurement is the business-to-business purchase and sale of supplies and services through the Internet as well as other information and networking systems, such as electronic data interchange (EDI) and Enterprise Resource Planning (ERP). According to (IT World Ltd., 2004), "the extent of ERP and APS software has shown that buyer's purchasing chain has extended outside the internal system and connects to various suppliers, and is expected to be integrated within a computerised supply chain management".
E-procurement is a supplier exchange method could be seen as "using the internet to operate the transactional aspects of requisitioning, authorising, ordering, receipting and payment processes for the required services or products" (IT World Ltd., 2004). In this case, E-procurement software may make it possible to automate some buying and selling, and companies would expect to control inventories more effectively, reduce purchasing overheads, and improve manufacturing or selling cycles.
Using electronic based systems within a traditional procurement environment introduces complexity and that means a system developed in an ad hoc manor is more likely to fail. E-procurement implementations used to facilitate catalogue-based buying of indirect materials such as office supplies, due to that the purchasing process of high-volume and low unit cost goods can be easily automated than the complex MRO or direct materials. However, with the participation of ERP and APS, e-procurement has moved step forward to both direct and indirect procurement, through data warehousing tools that interrogate ERP and other internal company systems, all information regarding suppliers and products can be captured and connected, and allow companies to access and organise all transactional purchasing information, and relationship information of products and suppliers include their delivery and financial history. E-procurement can then deliver a series of effects – better productivity, faster processing, greater visibility, and the elimination of unplanned, ad hoc buying – can have a much higher Return on Investment (ROI) than what can be achieved by saving a few pennies off the buying price.
E-procurement can be broken down to the following sectors:

1. Web-based ERP (Electronic Resource Planning): Create and approve purchasing requisitions, place purchase orders and receive goods and services by using an e-procurement software system based on web servers of software developers.
2. E-MRO (Maintenance, Repair and Operating): The same as web-based ERP apart from the goods and services ordered are not directly linked to products.
3. >E-Sourcing: Identify new suppliers for a specific category of purchasing requirements by searching over the internet through different portals.
4. E-Tendering: Send requests for information and prices to suppliers and receive responses of suppliers via the internet or use online platforms.
5. E-Reverse auctioning: Purchase goods and services from a number of known or unknown suppliers, "it is a type of auction in which the role of the buyer and seller are reversed, with the primary objective to drive purchase prices downward." (Wikipedia)
6. E-Informing: Gather and distribute purchasing information both from and to internal and external parties by use the e-procurement software system.

3.3 E-Procurement VS Traditional Procurement

Traditional procurement within an organisation often goes for cost-cutting strategies; with ORM (Object Relational Mapping) control e.g. on reduces furniture, stationery or business class flights. Savings mainly generated from sales negotiations, discounting or price reductions. However, there have always been certain degrees of poor planning, inconsistent product quality, and unpredictability of the relationship between buyer and seller (Chaffey, 2004). The main purpose of e-procurement is to drive inefficiency out of the supply chain. The traditional procurement process can be shown as in table 3.3.
E-procurement on the other hand tends to automate the process and reduce human labour through computerised systems. Under e-procurement, the traditional process can be automated at certain level and reduce the human intervention.
A typical e-procurement system should include the following functions:

1. E-Sourcing & select goods: System provides customised products from e-catalogues with corresponding supplier details. Identify new suppliers based on purchasing requirements using Internet technology. Comparative product and price, together with the direct web-link to supplier's website, and provide user friendly negotiation tools.
2. Approval System: Email generated along side the selection of product or supplier, automatically sends to the manager with customised and prioritised according to the required date. And if no response is received, the email automatically sends to the next decision maker to ensure no time is wasted.
3. Purchase Order management: The ordering, approval, invoicing, and receiving processes should be automated. As the system automatically notifies buyers of approvals and accounts payable, paper based invoices against requisition forms can be eliminated. The information on costs spent is recorded instantly against orders and requisition status.
4. System Integration: All purchases made are directly linked to the company's ERP or other operating systems, stocks can be updated accordingly and delivery status can be monitored.
5. Reporting System: Different format of reports can be provided by the system, and purchase trends and estimate costs and negotiation potentials can all be analysed and judged for future procurement.
6. Payment System: Payments have always been the most difficult and critical part of ERP or e-procurement systems, since B2B payments are much more complicated than consumer transactions on websites. Electronic Bill Presentment and Payment (EBPP) is one of the common ways to settle B2B payments, it is "the electronic delivery and presentation of statements, bills, invoices, and related information sent by a company to its customers. Certain EBPP applications also provide the ability to electronically settle payment for goods or services. The internet and phone/IVR provides customers of banks and billing companies with methods to remit payments with convenience, as well as access billing information." (Wikipedia)

3.4 E-Procurement Models – Architecture

According to (Chaffey, 2004), there are three e-procurement models, buyers would focus on the purchase side and suppliers would focus on the sell side, the system can be divided according to whether the organisation have a one-to-many focus or a many-to-many focus.

3.4.1 The Sell Side Model

In the sell side, it is often a one-to-many model. Sellers create their website that allows different buyers to search and purchase their products online, and provides real-time or contract-specific purchasing. They can make their product catalogues available online and also through affiliates and real contracts in their partner's website as recommended suppliers. This method is focused on selling rather than purchasing.
The advantage here is that suppliers can create and maintain their catalogues online, and extend the opportunities for more buyers to purchase goods. Whilst the disadvantage to the system is that the online system is a common portal, it used to be difficult to integrate adequately with the buyer's system especially the financial system. In this case the buyers may find it not being an automatic system as they still have to locate the website, log on and manually enter orders through the web order form. For companies who have hundreds of suppliers, this is virtually impossible, thus this model only suits small buyers or small quantity of transactions.

3.4.2 The Buy Side Model

what The buy side model works on the reverse way of supply side, the buyer maintains the product catalogue internally and the catalogue connects to the database of suppliers' goods and services. The suppliers send all the updated information including price, specifications and availability electronically to the buyer, in this case the buyer stays as the host, and take control of all the purchase orders and payments through electronic invoices and funds transfer at their desktop computers. The procurement is tied with the internal ERP system and therefore the change of stock and price or other criteria are always managed up to date. The buyer can find the products they need to purchase from their own system within all the updated product information from the suppliers, rather than log on to all suppliers' website to find out what products are available and in what price.
Although this model provides great convenience to the buyer, a number of procedures need to be executed before establishing such a system, there is significant efforts required in the initial negotiation and collaboration between buyer and supplier, because the responsibility is on the buyer side to manage the product catalogue and all the detailed information such as lead time and price. Such collaboration requires the support from the buyer side's upper management and the willingness of the supplier as well as their technical knowledge.

3.4.3 Independent Online Trading Portals

An independent portal site provides the platform for buyers and suppliers to find each other electronically and setup business transactions instantly or potentially. It is normally a website available to all buyers and sellers with the searchable product information and company briefs, a subscription fee may be required to access all available information, or a percentage of the to be done deals can be charged.
The main advantage of these portals are the sourcing convenience provided for the buyers since it is not always easy to find certain products or suppliers, as it often takes days and months to complete the sourcing tasks. The information on these portals are always updated by the suppliers and managed by the portal moderator team. The buyer can search the products they need to purchase or outsource the tasks to the available suppliers through the portal.
The disadvantage is that the payment system is difficult to manage as the currency and accounting policies varies from different countries, for B2C or C2Cs, the payment terms can be simple, as eBay proved the success, but for B2B clients, the amount can be large and the term varies especially for direct purchases, products have not been manufactured yet, deals can be split into several payments. Although there is not a B2B portal as successful as eBay so far, but the existence of independent portals is un-doubtly a boost for online trading and e-procurement, and the technology is developing day by day.

3.4.4 Benefits and Barriers

The idea of automating the procurement process adds competitive value to many organisations' buyers and other operating officers. If properly implemented, E-procurement systems will provide an organisation with opportunities to achieve the following conditions:

1. Reduce price of materials and transaction costs;
2. Identify and prioritise organisation requirements for sourcing goods and services;
3. Improve efficiency and reduce labour costs, eliminate manual and paper based processes;
4. Gather significant and accurate data on spending to assist cost analysis and provide decision support;
5. Consummate the supply chain by internally integrate process and systems, and externally manage supplier relationships and collaborations;
6. Coordinate inventory and improve operational control;
7. Overall develop the business by agreeing strategic goals and cost saving programmes.

However, although develop e-procurement systems can provide the benefits identified, whether the implementation can be successful still involve risks, as a number of barriers can often occur during the implementation process.

1. Internal barriers: Companies who are investigating e-procurement solutions are likely to emphasis on issues regarding company culture and business processes. Firstly, to automate a number of processes could result in change in the behaviour of the management and buyers. Previously adopted processes may be slow and costly but can be effective in certain ways such as the convenience of negotiation and change orders, the orders not generated by an automatic system can be modified or confirmed at the latest stage, whilst in an automatic system, changes may result in delete the generated order and restart a new order. Certain companies and management may not like everything to be automatic but prefer to control them in hand as its part o the company culture. Secondly, the technological issues involve IT spend and system compatibility. An existing manual system may still have account management software; whether the new e-procurement system could integrate the account system is an important issue for managers, as they do not want to mess up the financial information. A good e-procurement system may cost highly as both hardware and software are required and plus the training cost, and it may take months to transfer the old information and adopt the new processes, during this transferring period, losses in trading and current system, and the worst, failure in reforming the system, could all happen.
2. External Barriers: The success of an e-procurement project is strongly linked to the use by suppliers of the system. The key reasons for supplier resistance to system are listed as follows:
   • Shortage of technical expertise;
   • Hardware and software compatibility;
   • Budget
   • Concerns of long term relationships and trust.

   As we can see that the first three reasons are quite similar to internal barriers but here they refer to the supplier side rather than the buyer side, thus they can also be classified as common barriers. The most critical issue is that e-procurement system requires partnership or certain types of system connections to be established between buyer and supplier; this partnership, SME suppliers would firstly consider whether trust and long term collaborations are built with the buyer, and consider the cost secondly, whilst for large corporations, they would prefer to have cost-effective methods by adopting such a system and small suppliers would have no choice but have to collaborate by implement corresponding systems as otherwise they lose their competitive edge easily.

3. Common Barrier -Technological Issues:Details of this common barrier is understood as the below issues:
   • Data integrity: Internally, organisations will need to consider and address the risk of integrate previous data with the newly formed system, as the data system could be different and training is required to ensure security and system smoothness. Externally, the supplier may change details of the original specifications, in this case the data and documents would need to be synchronised.
   • System Compatibility: Standards need to be agreed and implemented to ensure internal departments use the same version of key software and they are compatible with the version that suppliers use.
   • Firewall and Virus: Many organisations' existing firewalls restrict certain file types such as jpeg, exe or even zip files in order to prevent the spread of viruses. In this case, the submitting of documents between buyers and suppliers can also be restricted.
   • File Size: Some organisation restrict the file size that can be submitted. Solutions on split documents for review and evaluation and submitting to suppliers are required.

   In the modern business world, procurement is not just recognised as a strategic factor in business planning, but a major driver for the whole supply chain. "There are many reasons for its popularity. Specific drivers may be traced to such areas as trends in global sourcing, emphasis on time to market, product quality based competition, customer uncertainty and the need to improve bottom-line costs" (Kalakota et.al, 2001). Procurement officers may be forced to handle errors in ordering, costing and invoicing; which were often time consuming and costly to trace. E-procurement is introduced to improve the traditional procurement processes, however, owing to the risks and barriers identified, the following questions need to be analysed before taking the decision to adopt e-procurement systems:

   1. Is the value of purchasing high or low? If a company makes large purchases of raw materials or components and if the deals are over multimillion-pounds, such deals can often negotiated over weeks and months, and arranging for supplies for up to a year ahead. In such environments, e-procurement may not add value and can even be an obstacle.
   2. Is the product substitutable or not? If the materials can be substituted easily, the significance of e-procurement is little, as suppliers can often be changed and it is pointless to establish partnership with them.
   3. Is the competition strong or not? Strong competition often force companies to execute a series of plans, if the competitors are all improving their systems and efficiencies, the competitive edge may disappear if staying in the traditional way.
   4. How efficient are the internal processes? Internal surveys and investigations should be carried out to find out the efficiency, with time and costs being the main issues.

   The problems have now been highlighted and discussed. The next stage of this project is to consider the design and development a new system to solve the problems highlighted for the case study company.

3.5 E-Commerce Strategy (EC)

This section outlines the topics that are used in formulating an EC strategy. The prime focus of the report is on the B2B and B2C solution design categories but more in-depth research is done to explore and evaluate the options that could be used to used to evaluate EC strategy for a small-medium sized enterprise BCT.

3.5.1 Business to Business

B2B (business-to-business), also known as e-biz, is the exchange of products, services, or information between businesses rather than between businesses and consumers (Jones, 2001). It is classified as one of the category identified by the electronic commerce. The fig shows the overall picture of where B2B lies in relation to other categories (Chen, 2001).
B2B is normally carried out with higher volumes and takes automatic process transformation between the business organisations trading with each other. For example, an IT company selling services and experience to a bank. This business in this case is taking place between two companies, IT and bank. B2B allows for communication which is more frequent real-time, rapid and accurate. The B2B software can be used to force effectiveness in the manufacturing process. This business to business is seen as the supply chain process taking place between the following entities of the organisation a) Suppliers b) Producers c) Wholesalers d) Retailers and e) Brokers. The figure below shows a general architecture of a B2B concept. The customer and supplier company both have their own business processes but interaction between them takes place through the website at the supplier end. The interaction via website speeds up the business transaction and communication thus improving the operational efficiency.
The activities diagram in figure below shows the general operation when a transaction takes place between two business companies (Hogg et al. 2004). The major activities involving in an element of order processing are requesting a quote, receiving a quote, making an order, receiving and invoice and payment of the invoice which is usually following upon the receipt of goods.
The extranet and the internet are the prime means through which B2B executes and carryout its transactions. The Extranet provides with a facility that information can be shared between business partners as well as the customers. According to (Tan et al. 2000), "It connects multiple and diverse organizations online behind virtual firewalls, where those who share in trusted circles can network in order to achieve commercial oriented objectives". It extends the business enterprise to include strategic partners, suppliers, distributors, contracts and others that operate the physical walls of the organization but are nonetheless critical to the success of business operations.

3.6 Enterprise Resource Planning Systems

3.6.1 Introduction

ERP is the technology that integrates departments and functions across a company into one computer system. ERP runs off a single database, enabling various departments to share information and communicate with each other. ERP systems comprise function-specific modules designed to interact with the other modules, e.g. Accounts Receivable, Accounts Payable, Purchasing, etc. Some of the software modules which ERP addresses are described below.

3.6.2 Supply Chain Management

"Supply chain management (SCM) is the combination of art and science that goes into improving the way your company finds the raw components it needs to make a product or service and deliver it to customers" (Shaw, 2000) .
The following are five basic components of SCM (Clark & Lee, 2000).

1. Plan – This is the strategic component of SCM and allows forming a strategy for managing all the resources that leads to address the customer demands for the product or service. The main aim this phase is to develop of a set of metrics to monitor the supply chain so that it leads to efficient costs less and delivers high quality and value to customers.
2. Source – This phase allows choosing the suppliers that will deliver the goods and services needed to create the product. It develops a set of pricing, delivery and payment processes with suppliers.
3. Make – This step is called as manufacturing step. It helps in scheduling the operations for production, testing, packaging and preparation for delivery. It is the most intensive portion of the supply chain and measure quality levels & production output.
4. Deliver – This is the logistics phase that is responsible for the receipts of orders from customers, developing a network of databases, chooses the carriers to get products to customers and sets up an invoicing system to receive payments.
5. Return – It is most problematic part of the supply chain as it forms a network for receiving defective products back from customers and supporting customers who have problems with delivered products.

3.6.2.2 Benefits of Supply chain Management

The following are the main benefits which can be viewed based on the implementation of supply chain management.

• Improved visibility into demand fluctuations
• Reduced manual processing
• Improved visibility into the materials pipeline
• Reduced cost per transaction
• Reduced inventory cost
• Reduced VAN charges
• Improve customer service
• Expanded traded communities

3.6.3 Customer Relation Management

CRM is a continuing business related strategy that develops customer relationships based on the collected works and analysis of existing customer information across all interaction channels (Kim, 2006). According to (Wikipedia, 2006), "it's not a technology itself, but rather a holistic approach to an organisation's philosophy, placing the emphasis firmly on the customer". So, the CRM system should be able to identify the following important points (Wikipedia, 2006): –

• Significant client factors and customer based measures.
• Customer-oriented philosophy.
• Addressing customer complaints and providing customer support.
• Tracking customer's all aspects related to sales and services information.

The figure 6 shows a general CRM research framework. The diagram shows how all the five input variables are related and reflect the behaviour of CRM of the organisation. The combination of these five input variable categories captures the human participation, economic environment, strategic considerations, technical infrastructure, and intellectual capital components of e-CRM (Romano and Fjermestad, 2003).
As far as the architecture of the CRM is considered, it consists of three essential units namely a) Operational¬- this involves computerising the basic business operations b) Analytical- means implementing business intelligence to analyse the customer data and behaviour c) Collaborative- this involves client communication.
"Operational CRM (oCRM) describes the technology strategy of managing and interacting with customers across channels, through client-facing applications and integrated channel management. The oCRM applications are technologies that enable sales force, marketing and customer care automation" (Datamonitor, 2004)
"Analytical CRM is a consistent suite of analytical applications that help you measure, predict, and optimize customer relationships" (Sap White Paper, 2001).
"Collaborative CRM is an approach to customer relationship management in which the various departments of a company, such as sales, technical support, and marketing, share any information they collect from interactions with customers" (SearchCRM, 2003) .
To further get the understanding of these three CRM units and how they are linked with other on an organisation is represented in the figure 7 below (Sap White Paper, 2001). The diagram explains the customer life cycle management that can be used to improve the client/customer end of the organisation.
This can be of benefit to the E-commerce strategy which has to be developed as it directly deals with the customer satisfaction. This CRM package, as shown in the figure, not only manages the essential units of CRM architecture but also improves and maintains a record on the sales, services and the marketing functions of the organisation.

3.6.3.1 Uses of CRM

Below are some of the important benefits of customer relation management provided to organisation (Small Business Corner, 2006): –

• Employees can quickly assign, manage and resolve incidents with automated routing, queuing and service request rise.
• Provides a mechanism for correcting the deficiencies.
• Stores customer interests in order to target customers selectivity
• It helps to identify common support issues, evaluate customer needs, track processes and measure service performance.
• Employees can easily share sales and order information as well as support information and use it to identify top customers and prioritise service needs
• Tracks all contacts with the customers.
• Access to a centralised, customisable view of sales and support activity along with complete customer history either online or offline and from any location using a Web browser.
• Shorter sales cycles and improved close rates with tools that enable lead and opportunity management, workflow rules customisation for automated sales processes, quote creation and order management.
• Comprehensive reports that forecast sales, measure business activity and performance, track sales and service success, as well as identify trends, problems and opportunities.

3.6.4 Finance

Finance module addresses the ways in which individuals, businesses, and organizations raise, allocate, and use monetary resources over time, taking into account the risks entailed in their projects. The term finance may thus incorporate any of the following:

• The study of money and other assets
• The management and control of those assets
• Profiling and managing project risks

The activity of finance is the application of a set of techniques that individuals and organizations (entities) use to manage their financial affairs, particularly the differences between income and expenditure and the risks of their investments (Wikipedia contributors, 2007). In the case of a company, managerial finance or corporate finance is the task of providing the funds for the corporations' activities. It generally involves balancing risk and profitability. Long term funds would be provided by ownership equity and long-term credit, often in the form of bonds. These decisions lead to the company's capital structure. Short term funding or working capital is mostly provided by banks extending a line of credit (Wikipedia contributors, 2007). Financial Accounting Management is more concerned with the reporting of historical financial information, while the financial decision is directed toward the future of the firm and is thus called the Financial Accounting. It is the branch of accountancy concerned with the preparation of financial statements for decision makers, such as stockholders, suppliers, banks, government agencies, owners, and other stakeholders.
The fundamental need for financial accounting is to reduce principal-agent problem by measuring and monitoring agents' performance and reporting the results to interested users. It is also used to prepare accounting information for people outside the organization or not involved in the day to day running of the company. Managerial accounting provides accounting information to help managers make decisions to manage the business.

3.6.5 SWOT Analysis

SWOT Analysis is a simple but powerful framework for analyzing company's Strengths & Weaknesses, and the Opportunities & Threats that it faces (Mind Tools, 2006). This helps the organisation to focus on important significant strengths, minimize its threats, and take the maximum possible advantage of opportunities available through the analysis. A scan of the internal and external environment is important part of strategic planning process. "The environmental factor usually internal to the organisation can be classified as Strength (S) and Weaknesses (W), and those external to firm can be classified as Opportunities (O) and Threats (T)" (QuickMBA, 2004). This process of formulating these four features is called SWOT analysis. The figure 8 presents the SWOT analysis diagrams and explains how it fits into the strategic planning scheme.
So, an organisation has to monitor the internal environment and external environment in order to successfully execute the SWOT analysis. In the internal environment, all the strength and weaknesses should be carefully noted down. This is the most important factor for the business organisation in order to excel its plans and goals and achieve milestones. The accurate formulation of strengths and weaknesses makes the business to be confident and prosper in right direction. Factors that can be evaluated across the organisation in this area are (NetMBA, 2006): –

• Company culture
• Company image
• Organisational structure
• Key staff
• Access to natural resources
• Operational Efficiency
• Operational Capacity
• Brand Awareness
• Market share
• Financial Resources
• Exclusive contracts
• Patents and trade secrets.

The external analysis allows organisation to determine the opportunities and the threats posed by the external environment. Like threats, opportunities can also arise whenever there is a change in the external market environments. The factors that cab be responsible for the changes in the external environment can be (NetMBA, 2006): –

• Customers
• Competitors
• Market trends
• Suppliers
• Partners
• Social changes
• New Technology
• Economic and Political environment

3.6.6 Critical Success Factor Analysis

This is one of the top-down approaches which could be used for clear identification of the objectives and the business process activities in terms of key information needs of the organisation. The Rockart (1979) defines critical success factors as being "for any business the limited number of areas in which results, if they are satisfactory, will ensure successful competitive performance for the organization". So, based on these critical success factors it is possible for the managers to concentrate on the key resources for developing the new the system successfully. According to Butler and Fitzgerald (1999), critical success factors are the functional areas where things must go right to ensure successful competitive performance for an organization. The figure below shows the framework of the critical success factors for e-commerce markets (Li and Li, 2005).
The framework consists of three factors that help in evaluating the success of the organisation in addition with some other tangible input variables. The Functional factors include facilitation of customization of the product, bidding or negotiation support, and access to a similar interest user community (Li and Li, 2006). The Strategic factor helps in targeting the product for buyer and seller and allows features to apply such as brand establishment, customer focus, and outsourcing. The Technical factors address the issues of QoS (quality of service), response time, technical performance features leading to satisfy the needs of E-Commerce strategy (Li and Li, 2006).

3.6.7 Knowledge Management

Knowledge management has been described as a process of creating, capturing and using knowledge to enhance organisational performance at the organisational, rather than the individual, level of analysis (Edwards et al. 2005). Edwards et al. (2005) presents the figure that states what knowledge can be used that inform the business. The Strategy, Market including the customer information & benchmarking, Technology, Finance, People, Operations and other information like partners and regulations reflects the knowledge of the business and its behaviour.
The diagram shows in percentage about the contribution provided towards reflecting the knowledge of the organisation. The knowledge doesn't mean merely data and statistics about the previous records rather is more than that. The simple collection of data is not called the information and similarly just collection of information is not called knowledge. For this, an explanation using the diagram is provided to help associates understand the pure knowledge underlying the organisation. According to (Fleming, 1995), this diagram shows how data rise up in relation to understand to become the knowledge of the system.
The main conclusion deduced from this by Fleming (1995) was that:-

• A collection of data is not information.
• A collection of information is not knowledge.
• A collection of knowledge is not wisdom.
• A collection of wisdom is not truth.

The knowledge management system is very important as it resolves lot of issues without any external help in the system. It gives the system with a power to excel its business process operations. Majority of the firms that fails to succeed have a common reason of not understanding the real knowledge underlying their own system.

3.6.6.1 Uses and Benefits of Knowledge Management

Below are some of the uses of and benefits of Knowledge Management system that makes it attractable to various organisations.

• Increase relevant information access
• Facilitate collaboration & knowledge sharing
• Retain institutional knowledge
• Overcome organizational & geographical boundaries
• Lower cost of doing business
• Higher quality products, decisions & recommendations
• Increased productivity

3.6.7 Data Warehouse

The data warehouse is the main repository of the organization's historical data, its corporate memory. The term data warehouse architecture is primarily used today to describe the overall structure of a Business Intelligence system. Other historical terms include decision support systems (DSS), management information systems (MIS), and others.
According to (Wikipedia contributors (b), 2007), the data warehouse architecture describes the overall system from various perspectives such as data, process, and infrastructure needed to communicate the structure, function and interrelationships of each component. The infrastructure or technology perspective details the various hardware and software products used to implement the distinct components of the overall system. The data perspective typically diagrams the source and target data structures and aids the user in understanding what data assets are available and how they are related. The process perspective is primarily concerned with communicating the process and flow of data from the originating source system through the process of loading the data warehouse, and often the process that client products use to access and extract data from the warehouse

4. Research Methodology

The following systems development approach progresses through the e-procurement methodology outlined earlier, giving explanations where appropriate. The development of the project begins with the system being initiated with a project initiation document. All the tools and techniques associated with the e-procurement procedures have been taken from (a number of websites and books, will be clarified later).

4.1 Project Initiation Document

1. Design a computer based system that stores all forms of queries and orders between BCT purchasing department and suppliers.
2. The system should store all correspondence between potential suppliers and the purchasing team. Including letters, and emails.
3. The system shall be more efficient than the present paper based system, in the fact that all information about products and suppliers can be found easily and quickly.
4. The system should improve the current supply chain efficiency by speed up processes and eliminate unnecessary procedures.
5. The scope of the project, in terms of people, includes selected people from BCT and suppliers.
6. It is required that e-procurement is used for the analysis and design of this system.
7. Identify human and technical issues and the implications may carry and consider the possible solutions. Including system compatibilities as further as international procurement and collaborations.
8. Some Information may have data protection or security risks that will need to taken into account during the systems development.

This section provides the methodology of the empirical study and gives the details concerning case study. According to Marshall and Rossman (1999), a methodology chapter serves to describe the research design and research method. Although the choice of research method and practices depends upon the research problem and research questions that are asked, it should also reflect the researcher's scientific positioning.

4.2 Research Purpose

Classifying business research on the basis of purpose allows us to understand how the nature of the problem influences the choice of research strategies. Referring to Zikmund (2000), the nature of the problem will determine whether the research is exploratory, descriptive or causal. Accordingly, Reynolds (1971) and Yin (2003) mentioned that scientific research has three purposes: exploratory, descriptive or explanatory.
Exploratory studies are used to clarify and define the nature of a problem. They are used to analyze a situation, to gain a better understanding of the dimensions of a problem. The purpose is however not to determine a particular guideline. Exploratory research is instead conducted with the expectation that subsequent research will be required to determine the proper course of action. According to Yin (2003), the purpose of this kind of research is to gather as much information as possible about a specific subject. It is further common to use many different sources to gather this information. The technique that is best suited for information gathering when performing an exploratory research is interviews. Unlike exploratory studies, descriptive research is based on some previous understanding of the nature of the research problem. The purpose of descriptive studies is to describe the characteristics of a complex phenomenon or population. Even though the answer to the question why is never given, descriptive information in many cases enough to solve business problems.
naMoreover, descriptive research is often used when a problem is well structured and there is no intension to investigate cause/effect relationship. Causal or explanatory research is often preceded by exploratory and descriptive research. Causal studies refer to research conducted to identify cause-and-effect relationships among variables where the research problem has been identified narrowly.
Research with the purpose of inferring causality should according to

1. Establish the appropriate causal order of events;
2. Measure the concomitant variation, i.e. the occurrence of two phenomena that varies together, between the presumed cause and effect;
3. Recognize the presence or absence of alternative reasonable explanations or causal factors.

According to Yin (2003), the objective with an explanatory research is to analyze cause-effect relationship, explaining what cause produces what effects. Based on our research question, our study is preliminary descriptive due to the fact that we intend to describe the area of research and try to explain the collected data in order to investigate the differences and similarities with our frame of reference. Beside that, it is also our intention to explain casual effect on relationships by evaluating answers to the research questions. Therefore, it makes our study somehow explanatory.

4.3 Research approach

The purpose of the study and the accompanying research questions determines the best approach for a study. According to Guba and Lincoln (1994), two approaches or methods – quantitative and qualitative – are available to researchers. The qualitative approach implies an emphasis on processes and meanings that are not measured in terms of quantity, amount, intensity or frequency. The qualitative approach provides a deeper understanding of the phenomenon within its context. Moreover, qualitative researchers stress the socially constructed nature of reality that states the relationship between the researcher and the phenomenon under investigation. On the other hand, quantitative researchers emphasize the measurement and analysis of causal relationships between variables, not processes.
As stated by Sullivan (2001), the distinction between qualitative and quantitative approaches depends primarily on two factors:

1. The state of our knowledge on a particular research topic.
2. The researcher's assessment regarding the nature of the phenomenon being studied.

According to Sullivan (2001), when there is little theoretical support for a phenomenon, it may be impossible to develop precise hypotheses, research questions, or operational definitions. In such cases, qualitative research is appropriate because it can be more exploratory in nature. Characteristics of qualitative studies are that they are based largely on the researcher's own description, emotions and reactions. The qualitative approach also includes a great closeness to the respondents or to the source that the data is being collected from. It is characterized by gathering abundant information and to investigate several variables from a few numbers of entities. To make use of the possibility to gather high quality data, the most common way to do this is with the use of case studies and interviews where no set answering alternatives are being offered.
Based on our research questions and above discussions, we choose the qualitative approach, because we need to investigate the area of research very closely and we are seeking in-depth materials/answers in order to gain deep understanding of procurement subject and its new concept. Also we do not intend to quantify and generalize the data.

4.4 Research strategy

"The strategy is a road map, an overall plan for undertaking a systematic exploration of the phenomenon of interest".
There are many possible strategies available to a researcher. Yin (1994) has identified five strategies; experiments, survey, histories, analysis of archival information, and case studies. Each of these strategies is a different way of collecting and analyzing empirical evidence. Usually, case studies are considered appropriate for the exploratory phase, while surveys and histories fit the descriptive phase, and experiments are the only way of doing explanatory or causal inquiries. However, according to Yin (1994), this hierarchical view is incorrect and each strategy can be used for all three purposes: exploratory, descriptive, or explanatory. He distinguishes strategies on the basis of three conditions:

1. The type of research questions posed
2. The extent of control an investigator has over actual behavioral events
3. The degree of focus on contemporary as opposed to historical events

5. Data Analysis

In order to view the effects of the accounting techniques, a simple calculation was made based on the data given from the company. A simple scenario was used to compute the effectiveness of the new technique. The instrument used for carrying this scenario was the activity based costing and the methodologies used in ABC. Time splits, time driven and time capture costing are the three methodologies that ABC uses in calculation. But before actually analysing the scenario and data, some basic principles of the ABC should be kept in mind.

5.1 Principles of ABC

1. Activities consume resources: -The more an activity is performed, the more resources will be consumed by it (Business Objectives, 2006).
2. Activities have a cause: – All activities are performed for a reason or cause. The causes can be external or internal based on the problem. The external causes can be because of customers, products, or distribution channels and internal ones can be because of internal support activities carried out in personnel or IT functions (Business Objectives, 2006).
3. Different levels of activities: – Traditional costing methods, such as standard or absorption costing, allocates base costs directly to products, customers, or distribution channels. These methods ignore the principle that resources are actually consumed by activities, and not by the products, customers, and channels. ABC allocates costs to customers, products, and channels in line with the proportion of activities they actually consume (Business Objectives, 2006).

The Figure below illustrates resource cost allocation to activities. This allocation is done based on the proportion of the appropriate driver volumes they use. For some activities, defining a sensible causal link to customers and products is not obvious, or may indeed not be a sensible thing to do at all. For example, most of the activities carried out by an organization's CEO would probably not be attributable to particular products or customers. The "non-specific costs" that cannot be attributed to an activity have no relationship with customers or products are shown in the below which generally includes expenditure on corporate branding etc (Business Objectives, 2006).
Let's take a scenario which helps in determining these ABC methodologies better. The scenario is based on one of the department of the organization that carries out two activities processing applications and late payments. The department processes 5,000 applications and chases 1,000 late payments per month approximately.

Resources

There are four people in the department who work seven hours per day in approximately 20 working days during the month. This means 560 hours (33,600 minutes) of available capacity. The supervisor spends 60% of her time managing this department, and the remainder of her time managing another department.

Cost

The expenses i.e. salary, benefits, etc. incurred by running the department each month is $16,800 (approx). The supervisor's costs are around $5,600. The estimation drawn by the supervisor is that 60% of his time is spent on "process applications" activity and 40% on chasing late payments. The additional $4,200 is assigned to the department each month to cover indirect costs such as facilities, IT, and human resources. These indirect costs are split across the two activities based on the resources they consume. The "late payments" activity involves making extensive outbound phone calls. As a result, this activity receives a bigger assignment of the cost at 70%, while the "process applications" activity receives 30% (Business Objectives, 2005).

Time Splits Methodology

These are the simplest ABC methodology where managers are simply surveyed to identify what proportion of their time is spent on various activities. This split is then used to allocate expenses to activities.

Calculated Example of Costing Using Time Splits

The department manager needs to provide only three numbers: the proportion of time spent processing applications; the proportion spent chasing the late payments, and a figure for any excess capacity. According to the manager the activities are fairly split up into 66% for processing applications and 33% for late payments (Business Objectives, 2005).

Calculation

The calculation is split into two stages: first we assign resource costs to activities, and then we assign activity costs to cost objects. In step 1, time splits are used to assign resource costs to activities. In step 2, volume drivers are used to calculate activity unit rates (Business Objectives, 2005).

Time Capture Methodology

Time capture is particularly useful for determining how staff members split time between projects and customers. Time capture is particularly useful when applied to functions such as R&D, IT, or in professional service organizations.

Calculated Example of Costing Using Time Capture

The amount of time employees spend on each activity could be captured from the systems they are using which can be a specific time capture application or various time sheets. In this case, figures show 336 hours spent on processing applications, 168 hours on chasing late payments and 56 hours as excess capacity (Business Objectives, 2005).

Calculation

The actual hours used to assign resource costs to activities in step 1 are shown in figure below. But in step 2, volume drivers are used to calculate activity unit rates.

Time-Driven ABC Methodology

Time-driven ABC requires estimates of only two parameters:

1. The unit cost of supplying capacity and
2. The time required to perform a transaction or an activity.

The volume of transactions is fundamental to the calculation of time-driven costing. For instance, the number of purchase orders processed, the number of inbound phone calls answered, and the number of deliveries made.

Calculated Example of Costing Using Time-Driven ABC

The processing system provides the average duration time for processing applications and the phone systems provide the average duration driver for the time needed to chase a late payment (Business Objectives, 2005).

Calculation

As the resource consists of a team of four working seven hours per day for 20 days, the supervisor has tracked holidays and sickness and has calculated the available time should be reduced by 10% in order to accurately reflect the true resource (Business Objectives, 2005).
By performing this analysis, managers can easily estimate operate on estimations and other cost predictions and calculations and could easily cut loose unnecessary activities which ultimately affect the business growth and profits.

5.2 E-commerce Technology Rationale

The e-commerce strategy chosen for the tourism company is B2C model which has its main drive force as CRM (customer relation management). B2C e-commerce is considered to be fastest emerging commerce model where business companies and consumers interact electronically or digitally in some way. The majority of the strategy will use the B2C model but it has to use a bit of B2B model as well at the booking of transport or hotels end. Because the company has majority of its dealings with customer so a CRM package would be excellent. As far as B2B is considered it is only used at the transport or hotel booking end as the transaction deals with other business company which is completely dedicated to the transport or hotel purposes.

5.2.1 Why B2C?

Below are some of the basic functions that may have contributed towards the selection of B2C as the main package for the company.

1. Browser based access i.e. http://
2. Ability to upload and download with ftp: //
3. Ability to incorporate email through SMTP
4. If not entirely standalone, at the backend:
   • Payment systems linking to banks online
   • Possibly interface to in-house systems of site owner
   • Possibly integration with systems of other businesses that may be required for offering (e.g. www.tourkerala.com )
   • This may use http, web services and XML or others.
5. Faster transactions and more convenient.
6. Offers and costs can be altered at any time.
7. Easy Integration with websites.
8. Enhancement in buying experience via telecommunications

Benefits of CRM package which is the drive force of B2C environment: –

1. Is able to identify the following: –
   • Significant client factors and customer based measures.
   • Customer-oriented philosophy.
   • Addressing customer complaints and providing customer support.
   • Tracking customer's all aspects related to sales and services information
2. Employees can quickly assign, manage and resolve incidents with automated routing, queuing and service request rise.
3. Provides a mechanism for correcting the deficiencies.
4. Stores customer interests in order to target customers selectivity
5. It helps to identify common support issues, evaluate customer needs, track processes and measure service performance.
6. Employees can easily share sales and order information as well as support information and use it to identify top customers and prioritise service needs
7. Tracks all contacts with the customers.
8. Access to a centralised, customisable view of sales and support activity along with complete customer history either online or offline and from any location using a Web browser.
9. Shorter sales cycles and improved close rates with tools that enable lead and opportunity management, workflow rules customisation for automated sales processes, quote creation and order management.
10. Comprehensive reports that forecast sales, measure business activity and performance, track sales and service success, as well as identify trends, problems and opportunities.

6. Strategy Development/

The section develops the strategy which was chosen for the system.
The figure 15 shows the strategy architecture of the company which involves both the B2C and B2B model. At the customer end, the B2C model is applied as this end has customer dealings with company. Customer at this end searches for the nice suitable interactive package and navigates through the package.
The customer needs to make their profile on the website in this view as then only they will be considered as the registered user and their data will be stored for some period of time. This storing of customer details can be useful as to form a good customer relationship by forwarding some very cheap exciting offer packages to the customer address without actually asking customer.
Once the package is selected and the payments are received by the company, the rest bookings for transport and hotels as per the package details are booked by the company using the B2B model. This model will allow company to make transaction and deals directly with other companied using the business to business package. The B2C view is shown in figure and is outlined using the red line whereas the B2B view is outlined using the green line. The databases between the two business companies are shared and thus form the extranet. Based on this architecture, many features and functions can be measured and evaluated to check the overall prosper of the system. The figure below shows the features and functions that can be measured are a) resources b) success factors c) system measures d) business performance and internal & external environment (Chen et al. 2005). These can be evaluated on six monthly bases to see if the system is able to fulfil the needs and requirements for prospering of the position.
The resources are the various systems and subsystems that constitute the overall functionalities and services in a trade centre. On the other hand, success factors are closely associated with the business nature of an intelligent trade centre. As per Chen et al. (2005), "these take into consideration the environment, both internal and external to an organization, in which the system operates". The internal environment includes functional units e.g. management, finance, human resources, warehouse and IT/IS department where as the external environment includes the existing international standards and national policies with which the new system should conform. The performance measurement can be visualised using the market-quality based approach which is effective to describe and assess the functioning of market institutions rather than using traditional revenue based systems. The Organizational performance is defined as the long-term competitive advantage a firm can gain over its competitors (Chen et al. 2005).
The implementation of e-commerce based B2C model will also bring about the changes in the business expectations, business perceptions and business compliance (Cash et al. 2004). These three changes are responsible for driving a variety of sub-changes in the ways e-commerce projects are conducted, which in turn have driven changes in the proficiency requirements of IS professionals engaged (Cash et al. 2004).
On the other hand, CRM which is the prime driving force for the business to consumer model will help in maintaining the customer satisfaction and will provide full support. This being the essential requirement of the project will certainly improve the work and speed up the transaction processes thus enhancing the efficiency of the system. The figure below shows how CRM software will be able to communicate between the customers to provide support. The CRM will software not only helps business to improve relations with the customers but will also provide help to other general features of the system. It will make the promise, keep the promise and will accept the promise. This means issues regarding marketing & sales, order fulfilment and electronic services will be taken care off.
This CRM will be beneficial to the E-commerce strategy at it will be developed with direct relation to the customer satisfaction. This CRM package, as shown in the figure 7, not only manages the essential units of CRM architecture but also improves and maintains a record on the sales, services and the marketing functions of the organisation. This will be very important in case of the "Tour and Travel" company as the basic necessity and requirement is customer satisfaction.
Critical Success Factors/ Key Performance Indicators and SWOT Analysis
These can simply be evaluated at some scheduled plan time in order to identify in and outs of the system. This will give the management an idea that on which areas more emphasis should be given. These will ensure the achievement of goals and targeted milestones of the business. Critical Success Factors as being "for any business the limited number of areas in which results, if they are satisfactory, will ensure successful competitive performance for the organization". So, based on these critical success factors it is possible for the managers to concentrate on the key resources for developing the new the system successfully. According to Butler and Fitzgerald (1999), critical success factors are the functional areas where things must go right to ensure successful competitive performance for an organization.
KPIs on the other hand will help organisations achieve organizational goals through the definition and measurement of progress. The key indicators are agreed upon by an organization and are indicators which can be measured that will reflect success factors. The KPIs selected must reflect the organization's goals. These must be the "key" to its success and must be measurable.
The SWOT analysis is important part of the e-commerce strategy as in case of the Ideal Tour and Travel Company. This SWOT analysis will help business to expand and achieve the goals and milestone easily as knowing the strength, weakness, Threats and opportunities and will boost the company against the other competitors who deal in same business.
This section outline the design solution based on which the interface for the Ideal Tour and Travel will be made. This interface will focus on the user-centered approach which could interact well with the customer. According to Norman (2002), the basic principles behind the good design are as follows:-

1. Visibility: –
   This means that by viewing user should be able to tell the state and actions of the system.
2. Conceptual Model: –
   This means that user should be able understand the operations and features of the system.
3. Mappings: –
   This means that user should be able to map the relationships between the actions and results, controls and their effects and system state.
4. Feedback: –
   This means that users should get full and continuous feedback about the results of the actions.

The figure 18 describes the design space of the interactive information retrieval system from the user-centered view (Mulhem and Nigay, 1996). The physical action here means the change in state of the device e.g. when the user is typing-in the query. The informational unit refers to when the system identifies the search criteria and the system action means the change in the behaviour of the system when a physical action is performed. The ability of the system to perform the relevancy based search is referred to system effect. The last step is the output physical action which means to successfully map the results on to the screen such that user can perceive and interpret

6.1 Navigational Model

The graphical user interface (GUI) for each online function should be implemented using one or more windows. The understanding of an overview for these windows is important before actually designing or building. It is important as it gives an idea of how the model can be designed to cover all the features and functions. According to (Weaver et al. 2002), when developing the window navigational model following points should be kept in mind: –

• Define frequent necessary exit points for the customer to quit or suspend.
• Mode should have consistency that can be checked against task model.
• Try to minimise the back & forth action on windows.
• Navigation for completing a task should be as low as possible.

Consistent structure dialogues.
A navigational model is generally composed of a navigational map (see Figure 19) that represents the global view of the system for an agent (user) in Object Oriented-Method ((Pastor et al. 2001). It is simply represented by a diagram where nodes are navigational framework and arcs are navigational links. A navigational framework represents the point of view that a user has on a subset of the object model. A navigational link allows navigating from one context to another (Pastor et al. 2001). So, in a store e-commerce application, when a request from a new user is received, the system can perform a service to create an instance of this user class and a service to assign him a shopping cart. When the system detects that this user has finished its session, a service to delete the shopping cart for unconfirmed purchases and a service to delete this agent instance will be executed.
This navigational framework also known as navigational context is further composed of three areas that are a) context definition area b) navigational area and c) advance features area. The context definition area specifies the type of context i.e. whether it is exploration (E) or sequence (s). The E context can occur at any time whereas the S contexts have to occur within a sequence of navigational links. "The navigational area is composed of a set of classes stereotyped with the reserved word «view»" (Pastor et al. 2001). These classes are called navigational classes and can be connected by two types of relationships. In fact, a navigational class can be defined as a projection (view) specified on a class of the object model which includes a given subset of its attributes and operations (Pastor et al. 2001).
The figure 20 shows the general skeleton notation for window navigation models and how these models work.
The diagram shows how the window control is transferred from one page to another using the button or icons. The diagram also shows the action names which are responsible for change in the status of the windows. The window can either move with removal of current window or without removal of the current as well. Based on this navigational format a model is designed for the Ideal Tour and Travel Company. This model will serve as the interface for the company and will be precisely used by the customers for searching and browsing to find the suitable and interactive packages for the company. The process starts at the customer end with a search or browse function provided for the customer. All the locations and for which tours are available will be structurally stored with the four major packages that are being currently provided by the company. These packages include: – Leisure Packages, Health Packages, Education packages and Farm Tourism Packages. Once the search process is completed either by specifying the criteria or just by exploring the pages, the package is added to the customer shopping cart as shown in the fig.
Here, three functions are available to the customer a) customer can still change his/her mind and can go back to search some different package b) customer can checkout to confirm the details and c) customer can all the way starts the search process again. Based on the selection, the process continues. Now, let us assume that customer checks out. There are two options for the customers either to match the details or to register a new account with the system so that all other simple steps for booking could be performed. If customer is the registered user then details can be matched and payment can be dome using the credit or debit card otherwise with some little personal information a new account will be opened by the customer followed by which payment could be done to book the package.
But before designing the prototype some sample window specifications should be made to see the working of the model. This will not only give an idea of how the model needs to be approached but also a prior evaluation is done.
The important things that should be considered while designing the windows are (Weaver, 2002):-

• Data entry fields- name, age, address, validation, optionality etc.
• The use of list boxes their contents, sort order etc.
• The behaviour of the window i.e. either Exploration (E) or Sequence (S)
• Tab sequences
• FAQs and Help functions.

7.0 Results and Conclusion

The results deduced from the data and the feedback received from the users during the evaluation stage states that the analysis done on the report explains that B2C is very highly appreciated and is recommended for the business which deals with the customer's satisfaction and communications between them when it comes to E-commerce technology. The B2C with CRM and execution of the CSF, KPI and SWOT analysis will make the excellent combination for the E-commerce strategy. The design solution prepared based on the windows navigational model is very helpful as it gives an idea of evaluation right at designing stage as well. The questionnaire and the practical testing allow users to test the usability of the system which proved to be good enough to interact with the users with no background of the computer interaction as well.
The technique used in the e-commerce strategy appears to work very well. The interface design is outstanding especially using the advance functions it proves to be very good Human-Computer Interaction prototype. The use of the window navigational model proved to be very useful as because of the clear idea given by it to design and develop the advance functions as well. These functions as per the results confirm that the model surely gives more meaning and is very easily communicable. The results produced by the interface based on the questionnaire, surveys and usability testing show that it's a very strong, proficient and well-organised model for building the tourism prototype and to achieve full success at the customer end. The strategy developed is seen as an excellent combination of E-commerce technologies for creating a tourism system.
Although the strategy is seen as useful and the design is evaluated to be very interactive and powerful but still good management is needed to maintain the success of the company. Plus, further work can prove to make this system as more solid as useful one.