ELECTRONIC COMMERCE UPDATE

July/August€1996

A Question of When, Not If

Electronic commerce has moved beyond the buzzword stage. It is no longer a technology people talk about using someday in the future; rather, it is a means of doing business that has either already been implemented or is in the process of being built into electronic business systems the world over.

But a certain trepidation hovers over the technology.

Despite repeated assurances from computer network personnel regarding the relative safety of conducting business over an intranet or the Internet, many still cringe at the idea of sending their sensitive and private information out over the ether. Visions of disheveled hackers greedily licking their chops in anticipation of yet another fresh credit card number or private business report to add to their growing international compilation come all too easily to mind in these days when the Internet is still a relatively new and somewhat mysterious method of communication to most.

Fortunately, the numbers don't support such a bleak perception. The number of people getting their credit card numbers ripped off from Web-based transactions don't even register in comparison to the number of credit card thefts taking place over the phone lines or by simply handing a card to the clerk in a store.

For the ensured future of electronic commerce, what remains is to continue shoring up confidence in the ever-evolving effectiveness of firewalls and other Internet security measures, and to devise means by which electronic transactions of all types are not only convenient, but friendly. To the technology's credit, businesses involved with EDI (electronic data interchange -- the automated transfer of standards-based, structured business data) are leading the way.

A study of 255 small and mid-sized EDI-enabled manufacturing firms, conducted by the Center for Electronic Commerce (CEC) at the Industrial Technology Institute in Ann Arbor, Mich., shows that those companies with more EDI-integrated business functions also exhibit the most positive business response in regard to improved customer relations, sales, expediting, production planning and labor usage. Even with the impressive results shown by this survey, however, CEC maintains that more steps need to be taken in order to put EDI, and therefore, electronic commerce, into a more advantageous position for business adaptation.

The following, summarized responses to a CEC EDI questionnaire show not only the steps necessary for EDI improvement, but also provide a handy checklist of capabilities an EDI-provider should be able to supply:

1) Specific, effective implementation methods must be supported by EDI support programs. Such tactics include meetings sponsored by the company requesting EDI, trading partner participation in pre-implementation planning, specification of particular transaction sets, specific target dates for implementation, implementation guidelines and manuals, a help desk, and consulting and technical assistance.

2) EDI support programs must help companies that are operating at many different levels of EDI maturity.

3) EDI integration assistance. Companies need help in moving from states of lesser integration to greater integration.

4) Help smaller companies establish EDI with their suppliers.

5) Aid in making effective use of information system expertise in support of EDI.

6) Help companies react to requests for EDI.

7) EDI support programs must be able to handle large volumes of business as more companies get involved.

While companies already involved with EDI have a multitude of doable plans in place for the future expansion of electronic commerce, much work needs to be done to make the technology viable for widespread use. One of the biggest obstacles in the path of worldwide electronic commerce lies in the restricted functionality of HTTP (hypertext transfer protocol) -- the language of the World Wide Web.

HTTP is a connectionless protocol. Each prompt by a user via his browser is a single, stand-alone action. HTTP has no capacity, as of yet, for grouping a set of requests. Such functionality is a critical element in performing transactions via the Web in relation to databases, through which many facets of electronic commerce will inevitably revolve.

There is no shortage of solutions for overcoming this protocol problem; the question lies in which path to take, which precedent to set. Will database vendors need to reconfigure their products to handle transactions of the type occurring over the Web? Or will HTTP be expanded to include the concept of transactions? Either one of these changes will take place, or an even better solution will arise.

Like the question regarding the proliferation of electronic commerce, the question is when it will happen, not if it will happen.

That is the mission behind Electronic Commerce Update: To bring you the latest news affecting the development and expansion of electronic commerce in all its varied forms. Electronic commerce has already inundated many areas of our lives, from instant banking to entry and retrieval of various information sources via the phone, and it will soon make an equally indelible mark in cyberspace.
The Web is poised to be the primary business environment not just of tomorrow, but later today, and electronic commerce will be the method by which we conduct our lives there.

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