CBSE Class 11th Business Studies Notes - n5

Business Studies - Class 11th (CBSE) - Chapter 5 (Emerging Modes of Business)

Here are the quick details:
  • Subject: Business Studies
  • Class: 11th (CBSE)
  • Chapter Number: 5
  • Chapter Name: Emerging Modes of Business

Definition of E-business

  • E-business may be defined as the conduct of industry, trade, and commerce using computer networks.
  • The most commonly used network is the internet.

E-business versus E-commerce
E-business E-commerce
E-business is a more elaborate term and comprises various business transactions and functions conducted electronically, and e-commerce is just a part of e-business. E-commerce involves buying and selling goods over the internet, and e-business involves buying and selling and other functions like product development, accounting, finance, inventory management, etc.
Scope of E-business
Type Explanation
B2B (Business to Business)

Here, both parties involved in e-commerce transactions are business firms using Electronic Data Interchange (EDI) technology. It involves various transactions through computer networks, such as:

  1. Placing orders
  2. Monitoring production
  3. Delivery of components
  4. Sending and receiving orders

For example: The manufacturer of an automobile requires the assembly of a large number of components, which in turn are manufactured elsewhere.
B2C (Business to Customer)

As the name implies, B2C (Business-to-Customer) transactions have business firms at one end and customers at the other end.

It is commonly known as online shopping. Also, B2C enables a business to be in touch with the customer on a 24-hours-a-day, 7-days-a-week, 365-days-a-year basis. It provides the following benefits:

  1. The transactions are conducted at a lower cost but with high speed. For example: ATM speeds up the withdrawal of money.
  2. It ensures convenience in delivery and payments.
  3. It enables a business to be in touch with its customers on a round-the-clock basis.
C2C (Customer to Customer)

Here, business originates from the consumer, and the ultimate destination is also the consumer.

It provides a market for dealing in goods for which there is no established market. For example: Selling used books or clothes, OLX, eBay, etc.
Intra B

Intra B involves transactions within a given business firm. It involves the use of the internet for managing interactions and dealings among various departments.

For example: Through a computer network, the marketing department can easily interact with the production department to provide information regarding new products. It includes transactions like interaction among departments, training of employees, selection, etc. It provides the following benefits:

  1. It facilitates 3D graphic communication and even multimedia among departments.
  2. It ensures a quick flow of decisions and information, a speedy workflow, and better coordination.
  3. It helps companies in personnel recruitment interviews, selection, and training.
  4. It also facilitates employees in sending their field reports by e-mail.
Benefits of E-business
Benefit Explanation
Global Reach/Access
  • The internet is truly without boundaries. On the one hand, it allows the seller access to the global market.
  • On the other hand, it provides freedom to the buyer to choose products from almost any part of the world.
Ease of Formation and Lower Investment Requirements
  • The formation of an e-business is relatively easy compared to other businesses.
  • Also, the amount of investment required to start an e-business is very low.
Movement towards a Paperless Society
  • Use of the internet has considerably reduced dependence on paperwork and the attendant “red tape”.
  • Even government departments and many companies are increasingly moving in this direction. Regulatory authorities have allowed electronic filing of returns, reports, etc.
Convenience
  • The internet offers the convenience of a 24-hours-a-day, 7-days-a-week, 365-days-a-year business that allows a customer to go shopping even after midnight.
  • E-business offers the advantage of accessing anything, anywhere, anytime.
Speed
  • The transmission of information through the internet is very fast.
  • The time taken from the origin of demand to its fulfillment has been reduced, especially in the case of information-intensive products like movies, music, e-books (PDFs), software, etc.
Limitations of E-business
Limitation Explanation
Increased Risk Due to Anonymity and Non-traceability of Parties
  • Internet transactions occur between cyber personalities. Therefore, it becomes difficult to establish the identity of the parties.
  • Also, one doesn’t know the location from which the parties are operating, which makes it riskier.
Incongruence between Order Taking/Giving and Order Fulfillment Speed
  • Information can flow at the click of a mouse, but the physical delivery of the product takes time. This incongruence may play on the patience of the customers.
  • Sometimes, due to technical reasons, websites take an unusually long time to open. This may further frustrate the user.
Low Personal Touch
  • No doubt, e-business involves high technology, but it lacks interpersonal interactions.
  • Hence, it is relatively less suitable in the case of products like garments, shoes, etc.
Ethical Fallouts
  • This business lacks ethics. The company keeps track of the e-mail accounts of its employees, computer files used by them, and websites visited by them.
People Resistance
  • The process of adjusting to a new technology and a new way of doing things causes stress and a sense of insecurity. That is why people resist entering into e-business.

The End

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A List of Notes:
Chapter 1  |  Chapter 2  |  Chapter 3  |  Chapter 4  |  Chapter 5  |  Chapter 6  |  Chapter 7  |  Chapter 8  |  Chapter 9  |  Chapter 10  |  Chapter 11  |  Chapter 12

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