Sample Essay with the Popularity and rise in the various uses of the Internet Information and Communications Technology

Chapter 1: Introduction

1.1 Background of the Study

            With the popularity and rise in the various uses of the Internet, information and communications technology (ICT) emerged to provide support to various organizational functions. Internet-based networks resulting to quick information updates has affected business operations of industries and commerce as well as consumer’s opinion of the real world and human lifestyle. Through the wide-ranging interconnectedness fostered by the Internet, systematic derivation, analysis, use and management of information and information technology developed.

            E-business, which is the conduct of business using electronic channels cover a number of primary functions such as online advertisements, orders and payments, customer service delivery, distribution and delivery, financial assessment and market research (Smith 2001). E-business emerged as a broad term encompassing the use of Internet availability, convenience, and widespread reach to improve existing business operations or create a virtual business. As a broad term, e-business encompasses a number of functions such as online banking, web hosting, online transaction provision, and online purchases or shopping (2002) together with other electronic functions. This concept implies the wide scope of e-business since all electronic utilities are covered. All business activities or transactions involving electronic tools or processes fall under e-business. In relation to the study, the use and application of e-business in garments companies are expected to be diverse and context-based as e-business strategies depends upon the specific needs and objectives of individual garments companies. Although the adoption of e-business may be diverse, garments companies are considered to have integrated e-business in their operations by using electronic functions in the production process through networked warehouse and production monitoring, website operations for individual and industrial consumers, and marketing through purchasing and payment options.

            E-business works by allowing business firms and consumers to gain information, with business firms interested in gaining industry trends and market research and sending product, service and brand information while consumers are interested in gaining information on available products and services and sending their orders and payments in making actual purchases. In a way, e-business provides an alternative means of interaction between business firms and consumers that defy geographical distance and time zone differences. E-business constitutes a model that fits the operations of international businesses or business firms seeking market expansion. Transactions also occur online with business firms offering or advertising products online and consumers making purchases through website order, payment and tracking functions.

            Apart from information management and business-to-consumer (B2C) linkage functions, e-business also offers various other benefits to different industries or sectors.

 (2003) explain that ICT, which is a part of e-business, supports the implementation of strategic initiatives. Business firms gain the ability to derive industry and market information they need to develop, implement and adjust production and marketing strategies. Without accurate and up to date information, the ability of business firms to develop and apply business strategies is limited. Strategy development depends upon information on innovations and strategy implementation largely depends upon current internal and external information, which e-business functions provide.

            Porter (2001) adds that e-business results to organizational transformation because electronic tools and processes require efficiency-driven change in the business values, operating systems and processes, and rules and regulations, marketing activities, and management functions of business firms. In applying e-business, firms need to change corporate culture to facilitate the acceptance and cooperation of the members of the organization.

            Olson (2006) explains that e-business has also influenced the external business environment by developing a new business competency and changing consumer demands. Flexibility to e-business becomes a highly valued competence among businesses and engagement in e-business functions constitute added consumer demands.     Phan (2003) further explains that e-business constitutes a means of developing competitive advantage. Porter (2001) describes competitive advantage as falling under two general forms, which are cost leadership and differentiation. Cost leadership pertains to the ability of companies to implement cost-saving production processes that concurrently allows the business firm to lower the price of its commodities relative to its competitors. Differentiation refers to the ability of business firms to create and offer unique value to consumers so that even if the price may be different or higher than that of competitors, customers hold the view that the value they expect to receive is equivalent or higher than the price that they have to pay for the commodity. E-business can facilitate cost leadership by allowing business firms to save on mistakes or delays by providing a means of integrating production and supply chain processes at real time to ensure convenience and efficiency. E-business can also support differentiation when business firms have adopted or developed e-business functions that allow them to provide added value to their consumers.   

            The adoption of e-business models of individual business firms is important to experience these benefits. In the garments sector, e-business supports production, marketing and management operations to ensure that the garments firms are able to determine market demands, translate these into production and service delivery outputs, and increase their levels of profitability and revenue generation. China has a thriving garments sector that caters not only to the domestic but also to the international market. As such, e-business offers to improve the operations of garments companies in China to support their business internationalization and viability objectives.

            However, adoption of e-business in the garments sector in China is highly diverse, with some companies fully integrating e-business models into their operations while others remain manually operated. The difference is highly linked to the size or the business organization, scale of operation, and business values of the firms. Moreover, the development of e-business in China is beset with the complexities brought about by the clashes between traditional business values and practices and business innovations (People’s Daily, 2000).

            Nevertheless, the development or enhancement of e-business in garments companies in China has great potential. As of 2007, China has 172 million users of Internet with 4 million individuals engaging in Internet use every month. (2007) This indicates that the Chinese market alone is able to support e-business marketing functions such as website development and online shopping. Since garments companies face competition from international garments companies that have already established online linkages, e-business would also allow Chinese garments companies to acquire e-business function competencies necessary to compete locally and globally.

            The study seeks to investigate the importance of e-business among garments companies in China by looking at the extent that individual firms belonging to the sector have adopted e-business. Concurrently, the study also covers the investigation of the perception of garments companies on the concept, functions, models, and importance of e-business. By deriving this information, the study should be able to determine the need to enhance the importance of e-business for garments companies in order to experience the various benefits that this business model offers and recommend ways for business firms to successful adopt e-business in their operations to support their long-term sustainability and profitability goals and other specific business objectives.

1.2 Aims

            The main purpose of this research is to help Chinese garment companies realize the importance of e-business in their firms as the initial step towards their actual engagement in e-business functions as a competitive strategy. Helping Chinese garments companies recognize the significant of e-business requires an inquiry into the various aspects of e-business in the Chinese context.

1.3 Objectives

            To accomplish the aims of the study, the investigation should cover a number of areas including:

1. status of the introduction and development of e-business in China;

2. e-business in the garments sector in China;

3. importance and benefits of e-business in the garments sector in China;

4. problems or issues faced by garments companies in adopting e-business; and

5. strategies in effectively adopting e-business in the garments sector.