Impact Of Global E-commerce Standards: A Literature Review

Important Research Variables

Discuss about the Impact of Global E-commerce Standards.

With increase in popularity and huge potential offered by internet in commercial application, it is no wonder that e-commerce has evolved as an immensely important and also interesting business platform. E-commerce has large effects on economy and almost every country largely depends on e-commerce as a process for conducting financial transaction online. E-commerce focuses on procedures by which all type of information gets exchanged. In today’s realms of corporate functions, e-commerce has very much a business to business affair with some focus on business to customer types of transactions. E-commerce cannot be confined to a clear cut meaning (Czinkota et al, 2009). The main aspect entails business transactions with the support of internet. This is also looked upon as a platform that incorporates application of technology for ensuring financial transactions effectively. Thus this popular process and platform involves participants who are business firms, individual persons and also government.  Way of doing business by many corporate is revolutionized by internet with convenience and fast operation as vital priorities. Organisations in Developed nations like UK and US are shifting to brick and mortar stores giving a thought that people in the countries are willing to shop online for enjoying flawless shopping experience (Da Costa, 2016). Ecommerce standards are vital for enabling business houses and their associates to automate business process especially, the buying as well as selling processes. The standards provide formats, rules and data patterns which are necessary for exchanging electronic procurement orders, shipping messages, and desires for quotes, repair orders and invoice and so on (Sohaib and Kang, 2012). This literature review is focussed on discussions of some e-commerce standards and their impacts. Opinions of several authors and their opinions with shades of arguments have featured in this literature review. 

B2B data standards    are well-liked tools which are considered useful for ensuring standardization within self-governing corporate. Generally these firms work together in supply chain so that to obtain maximum levels of effectiveness. The maximum useful aspect is that,     businesses among the firms get simplified by offering a general and common pattern of business system. Czinkota et al, (2009) stated that there are many functions for which they have been developed and the functions are quality assurance, production, and information technology and so on. Some challenging standards emerged with the improvement in technology and internet from late 90s and the standards were developed with the aim for supporting areas of e-commerce in business to business transactions (Solaymani, Sohaili and Yazdinejad, 2012). The internet popularity has brought about a model named ‘do it yourself’ which enables a company regardless of size, to develop own e-commerce standards. Da Costa, (2016) argued that due to this, the possible and likely happening was growth of many useful business standards being structured to mechanize business processes that are trade specific. This has created a riddle among many like which one is more vital and which one is least effective. It is obvious that in a value chain there are so many participants and  they, for the sake of business have the same opinion on a common standard, while most viable one sometimes do not get considered as stated by Doong and Ho, (2012). This is possibly due to existence of many standards being developed. A rather logical and meticulous selection of standards may benefit the companies, else the standards hardly get any justification. But confusion exists as pointed out by Gong, (2009) that if there an aspect is where having many standards hold back collaboration among companies in supply chain. Koh, Fichman and Kraut, (2012) stressed on “long tail” perception that introduces itself as a structure which measures the benefits and disadvantages too, meted out by growth of technical standards in the areas of supply chain processes.   Regarding this, Koh, Fichman and Kraut, (2012) expressed similar view as Doong and Ho, (2012) have.

Niche and Global E-commerce Standards – a Comparison

Long tail as a concept to know mass market performance- Behaviour of mass gets measured by this perception and Koh, Fichman and Kraut, (2012) suggested that a substantial portion of populace will embrace some of the manners which are most widely accepted and some other remaining population selects some niche approaches which are not popular as previously stated. Laudon and Traver, (2016) argued that the “long tail” exemplified how virtual business structures created by some pioneers have made a latest economic pattern for the industry in the field of internet.  

EDI or electronic data interchange has its dominion and others cater to niche section. The functionality of EDI was like building capacity of business to exchange information with another electronically applying standard format described by joint working group like government-industry participants (Eames et al, 2014). But as observed and stated by Koh, Fichman and Kraut, (2012), EDI application was mainly concentrated among large corporate while relatively small business could not afford it due to large expenditures associated with the data transmissions. For e-commerce in B2B segments, technology and economics had a changed paradigm. Hyper text transfer protocol and file transfer protocol invigorating e-commerce and freeing it from conventional networking models applied in EDI (Büthe and Mattli, 2011).  XML came into effect as an open standard for allowing information sharing among trade applications.  With the growth and popularity of XML at the beginning of this decade, some other standards also grew. According to Mehta and Shah, (2011), E-commerce standards in B2B were in use in major industries along with some sub-sectors. In sub sector like poultry and meat, creator of XML had a notion that this subsector needs a separate norm as these products have uneven weights that very often creates inconsistent measurements of packaging and highly custom-made price structures (Yunis et al, 2012). According to Koh, Fichman and Kraut, (2012), PIES became a standard that is product information exchange standard for cataloguing parts of cars by electronic means. Suppliers distribute catalogues by electronic means and retailers in automotive aftermarket find this convenient to upload these on the system for ordering parts.

Lee and Carter, (2012), argued that flexibility in technology along with industry specialization would not have been achievable by conventional EDI  and only new XML norms are useful, while Mehta and Shah, (2011) stressed that XML standards are not successful to be an effective substitute of EDI. Some left over B2B transactions are on the basis of EDI. Global financial service segment finds a standard which is non XML and is called SWIFT FIN message format as useful and noteworthy to be utilised. Comparatively small sized business partners use other standards in some sectors.  Lee and Carter, (2012), argued in favour of the new XML standards by stressing that traditionally EDI is hardly of any help to support framework of e-commerce to facilitate cooperation among business houses.

Consumer packaged goods- In between suppliers of goods, materials and packaging and manufacturers of consumer packaged products, four separate models of order fulfilment get used. While the models could be controlled by EDI, still it is decided by the industry that a different standard for customisation is of importance and requirement.  

High technology- PIPs are template called partner interface processes and some new variants of PIPs for end of life notifications for product are useful and with EDI, such specific templates were not realistic as asserted by Laudon and Traver, (2016).  Niche standards also require a review and have some downsides.   Although within a particular market segment, green coffee XML has effectiveness but possibilities are also high of this, to cause the e-commerce more complex. According to Thomas, (2010) from the perspectives of business associates in neighbouring sector. In B2B, EDI is used by government agencies that charge tax on importing as well as exporting activities. Corporate that deals in consumer packaged goods, freight carriers in ground and ocean use EDI. Thomas, (2010) suggested that, when it comes to complete value chain then as a separate standard, Green coffee XML is not the realistic one. 

Difference of standards through sectors has impact beyond only making technology management more complicated. While competing standards are in use among sellers and purchasers then business relationships build up and transactions get delayed lot of times thus keeping business and inter relationship vulnerable many times. Purwati, (2011) viewed that large retail and automobile companies with purchasing capacity dictates standards for B2B to their suppliers. Recently there is consolidation of some standards like Global standards1 that supports   specification in package labelling like RFID and bar codes. Laudon and Traver, (2016) stated that industry like pharmaceuticals and health care has achieved focus of GS1.

Amidst many existing standards like EDI and XML and non XML, new consolidated standards like Global standars1 and OAGI called as Open Application Group have achieved noteworthy appreciation in some industries. OAGI is merged with CIDX that harmonize standards among numerous industries which reap the benefits of the standards. Lee and Carter, (2012) argued that although these standards are popular but still their fruition in field of ecommerce is not beyond confusion in full measures.

Multiple standards when keep corporate in the dilemma to choose most viable one and puts pressure on them to cope properly. Sometimes businesses lose to reap advantage of framework of ecommerce designed for their specific sectors. Eventually they fall in a position to apply simplified standards to ensure interaction with their associates in different sectors. Sometimes these efforts become costly for the companies. Thomas, (2010) suggested that, by these activities firms can achieve competitive advantage which comes through niche standards whilst keeping up a large level of interoperability among industries. B2B e-commerce has somewhat become complex for rise of many standards in the last decades. Firms face more challenges to cooperate by electronic means in industries. This requires companies to spend more time to share information among them using varied standards and this sometimes become hugely cumbersome as stated by (Zhu and Thatcher, 2010).

Among some upheavals that are sometimes obvious in the standards, the advantageous aspect of the overall e-commerce platform cannot be undermined and these necessitate the existence of the standards. Zhu and Thatcher, (2010), emphasised that business can enjoy rapid growth from the inherent scalability and flexibility of e-commerce. Business can quickly adapt to market demands to satisfy needs of their clients. Companies can ensure more transparency to their clients in terms of offers by them in comparison to offers made available by competitors (Bauer, N?mcová and Dvo?ák, 2010). Laudon and Traver, (2016) argued that marketers and customers earlier used to have little volume of knowledge about each other while customers had little knowledge about products and marketers rarely could understand the actual or potential customers. E-commerce is of usefulness in this facet. Da Costa, (2016) stated that few e-commerce standards are hugely accepted and bundled into modern procurement system. These standards are of some benefits to companies and this cannot be ignored in modern day business particularly in aviation industry. Businesses have requirement to have protection from diverse standards at the application level.  Zhu and Thatcher, (2010) stated that using the same procedure to e-commerce in the segment of  B2B, SAP and oracle the ERP vendors offer a collection of embedded maps which can transform data in and out of standard design. Thomas, (2010) argued that reverse trend come into existence as ERP vendors contribute to the growth of standards.

This literature review posits several ideas and arguments that have been put forth by several authors. Thus this literature review has got into a shape of argumentative article that sheds knowledge. The apparent knowledge summation does not have any gap, but still some gaps are somewhat obvious in this literature review and the gaps need to be mentioned here.  Czinkota et al, (2009) stated e-commerce takes its stride  to mould   virtual business with global standards packed in it, the very pace of this get hindered  due to several disadvantages which do not have always to do with standards. Nonetheless these needed a mention which got away to be included in this literature review.  Thomas, (2010) expressed concern saying that If security is not properly augmented then customers’ privacy can be intruded on. Thus customers need to be ensured by the companies regarding regulatory compliance for security of privacy. Products sometimes are demonstrated along with competitive offers repeatedly from big retailers and better price can be accessed. For this reason, sometimes retailers suffer as they cannot achieve as much sales as expected. Returns of products and fake complaints rate become higher as customers often order products online and at the time of receiving the products other than by visiting stores in person they change their mind and tend to return the products on the pretext of faulty products (Thomas, 2010). To put it basically, they try to take chance of return policies which is in actual framed for the convenience of the customers. Big companies generally do not face problems while the small and medium firms suffer a lot due to this. All these apart, skill gap among the people handling ecommerce from the back end render this entire platform and process too complex and difficult to be implemented and  even a most effective standard of e-commerce is of little help then.   

Conclusion

In modern times both sellers and purchasers are dependent on each others. Customers expect better products and knowledge of products before arriving at a purchase decisions and buyers depend on customers as sales volume depends on their final purchase decisions. Companies in ecommerce business also look for coordination that becomes easy at affordable cost with help of ecommerce. Ecommerce depends on several standards which govern the process. Existence of numerous standards often poses difficulties for business to select the most feasible option Purwati, (2011) stated that EDI had its dominance earlier and arguments prevail when it comes to efficacy level of the various standards. XML as an open standard enables knowledge sharing among business applications. B2B is vital ecommerce segments and looks for ideal set of standards in the field of ecommerce. Challenges due to the standards, crop up which need to be resisted at the application level. There are many useful aspects of e-commerce as economy has substantial dependence on the rising platform of trade and commerce (Zhu and Thatcher, 2010). Cooperation among business firms can ensue better results along with focus on standards to be more tailored to the needs of businesses and their applications. Ecommerce has just begun to rise to have more beneficial impact on businesses and existent standards and imminent if are any may be of great help with adequate focus for realistic application suited to business needs.

References

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