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Anything that reduces human efforts and makes human task simpler may be termed as a machine. Computers have evolved into modern computers in few generations, each generation has its own importance and has made a significant role in developing and creation of this modern technology used within manufacturing process, the internal layout of computing system or the programming system.
The Z1 is considered to be the first electric binary programmable computer which came into being in 1936 to 1938, ABC & ENIAC were the first digital computers which were being invented at that period, However because the ABC was never fully functional we consider the first functional digital computer to be the ENIAC which came into completion by 1946 (Fig 1).
(Fig 1: The ENIAC (Electronic Numerical Integrator and Computer). Until the
ENIAC, the word computer referred to the human, not the machine.)
With the fast moving technology of computers it became quite obvious that the computer system would profoundly affect the change in the years to come. For many years after 1960, Desktops were quite popular for personal and business use. Research in computer technology continued giving rise to the development of Laptops, Palmtops and PDA's. In short this one word instrument does affect our lives no matter how much we discuss about it (Fig 2 ; Fig 2.1)
(Fig 2: Dell Inspiron; Base Model) (Fig 2.1: Dell Studio)
Every business plan should include market analysis, the one that's limited to your existing customer. The market for computers includes homes, schools, businesses, and government organizations.
"We gather requirements directly through tens of thousands of customer interactions daily, organized events, social media venues and customer panels. The mission is to deliver innovative and cost-effective solutions that meet today's real-life customer challenges and work seamlessly in existing environments and with other products to understand the potential market for PC's".
(Michael Dell - founder of Dell)
Offline (Traditional Commerce) -
Expansion is the apt word for the rising trend in the marketplace for computers since the time it was first incorporated in 1946. These days, be it a Desktop, Laptop, PDA's, Netbook all are easily available. One can actually notice the wide range of products manufactured by different companies and displayed in traditional commerce marketplace or storefronts. As there is demand for this product more and more vendors are entering this type of market with the invent of retail storefronts.
Generally all major computer companies have their storefronts set up in all the potential marketplace where they think that they would get their target customers and where the taste and preference of the customer are met. Some companies have also provided franchise and therefore this benefits the direct sales where the company during different period provide offers like discount coupons, free gifts and other offers. The consumer can visit franchise storefronts so that they can feel the product, check the configuration, fulfilling their needs and then making a decision of purchasing the product of their choice.
The offline market looks forward to provide satisfaction to all potential customers and therefore it operates on business to customer or business to business to customer type of market. The customer can come into the distributor storefront and visually distinguish the product, the pros and cons and compare the product not only with the same brand but also with different competitive brand as to what other companies are offering. The traditional commerce marketplace allows the customer to purchase the product there and then and gives the customer the bargaining power over the vendors before purchasing the product. The consumers can search along the marketplace before making a decision as to which product he should buy from which retail store, because being such a competitive market and consumer oriented the storefronts tend to keep the prices of the product in accordance with their customers that suit their needs
A computer storefront must be a reputed store, staffed by knowledge that are there to sell the best system and are not only concerned with the house brand of machines but what the potential market demands from them.
Online (Partial Electronic Commerce) -
Each and every computer company has its product listed on its website which brings about awareness to billions of people about what new is being offered by the company and to update the customers with what it was previously offering. Electronic commerce brings about a change in the buying behaviour of the customers as the customers no longer have to stand in a queue to purchase a product, they get all the information all the benefits by just a click of the mouse, one can complete its shopping sitting at home.
Statistics show that less than one-quarter of all households in Europe have PC's as compared with about half in the USA.
(Computer Industry Almanac, 1999; ET Forecasts, 2000, Pg.: 15)
Many companies like Dell, Sony offer their products in their website and also deliver the products to their customers for free locally. Customers can check the best type of computers, their operating system and their price, and can compare it with the other brand before actually investing in the product. Apart from the home site of the company there are many other site that offer the same product to customers like www.amazon.com, www.ebay.co.uk etc. they provide Desktops and Laptops at a much cheaper price.
Online shopping saves customers the time and also the transportation cost. Manufacturers are now able to sell directly to customers there by cutting off retail intermediaries and passing the cost savings to consumers. Online stores are able to offer low prices only because they do not require staff, retail store and this ends to benefit the customer.
The E-marketplace provide a forum for customers to be able to compare the computers and make a contrast of the different brand they can purchase, their favourite Laptops by just using their credit card or debit card and the product is delivered at their door step. On site like www.homedirect.com, www.auctionwatch.com also provides the consumer with E-auction facility where the consumer can buy the product by means of auction and as a result E-auction is another best way of reaching the product to its customers.
Comparison between online and offline marketplace:-
Point of Difference
Point of Difference
In an online business geographical location does not have much importance because only one common website have to be compiled with, throughout the world for a particular brand to bring about an awareness about the brand and its products and therefore it minimises the cost as well.
An offline storefront is expensive and finite and as a result is largely affected by the place where it is set up. It is therefore an expensive affair and has to be well maintained and has to be widespread to all the various location so that it brings about awareness.
Universal standards have to be maintained in an online business as the company has one common website and as a result it cannot distinguish between its customers and therefore the service that is provided is the same to all customers visiting the site.
In a mall or a storefront the uniformity cannot be maintained because it is largely affected by the geographical location and henceforth the prices does tend to fluctuate whereby the consumers end up paying a higher amount, therefore the prices of computer in a storefront would always differ from place to place.
A computer is such a product where the information that is provided should be apt and online market is the place where a consumer would get the right information for any type of computers at any time. Buying computers online one is rest assured of getting information about all the relative aspect that he or she feels before investing in PC's.
Storefronts are a place where one gets the right information about computers but not a complete one. Storefronts have limited stock and therefore they tend to keep information on that stock only so sometime missing out on key elements.
"selling on the web can create an opportunity to reengineer a business - rethink relationship with customers, distribution system, even the nature of the product". (C. Wilder, An Electronic bridge to customers, Information Week, 1995)
In storefronts a customer has an opportunity to ask the employee the queries he has but if the employee does not have a solution he has to refer to the company to provide the customer with the right information.
In an online market for computers the customers will be able to customise the product according to their needs and requirements.
In an offline marketplace the customer has to call the company for any detailed personalisation of the product
Time of Delivery
A computer is such a product where companies adopt different policies of delivering the product, some companies perform the function in a week or two and some take a month where the consumer finally gets its product.
In a computer storefront the customer physically see the product and receives the product at that instance, from the particular storefront he is purchasing his computer from.
Safety is the main concern to all customers in an online business, because lot of fraudulent takes place and as a result more and more potential online buyer are reducing.
In a storefront safety is the first thing that is kept in mind and therefore if any fraud is committed there is track of it. Customers feel safe while purchasing goods from these storefronts.
Value Creation in E - Business:-
Every firm is a collection of activities that are performed to design, produce, market, deliver and support its product. All these activities can be represented using a value chain (Fig 3). A firm's value chain and the way it performs individual activities are a reflection of its history, its strategy, its approach to implementing its strategy and the underlying economics of the activities themselves.
(Competitive Advantage - Michael E. Porter, 1985; Pg.: 36)
(Fig 3: Value chain analysis can be divided into two broad type, primary activity and support activity.
Primary activities are activities involve in the physical creation of the product while the support activity support the primary activities by providing purchasing input, technology, human resource and various firm wide functions.)
(Competitive Advantage - Michael E. Porter, 1985; Pg.: 37 &38)
Genetic Value chain analysis for computers
Primary value chain activities
There are five generic categories of primary activity involved in completion in any industry, each category is divisible into a number of distinct activities that depend on the particular industry and firm strategy:
(Competitive Advantage - Michael E. Porter, 1985; Pg.: 39)
Inbound Logistics: - Inbound logistics in reference to computer are associated with receiving, storing, inventory control, material handling, transportation etc. The computer dealers do not need to keep loads of stock at their warehouse thus reducing the cost to the great extent.
Operations: - In case of computers when we emphasise on desktops to obtain a final product lots of component are required and therefore assembling, testing, facility operation are some of the associates that are required to get the final product form. While in case of other forms of computers like laptops, netbooks, PDA's machining, equipment maintenance and packaging are the key elements to look at.
Outbound Logistics: - Distribution of the computers to the buyers is an important process and for that the most important factor that has to be kept in mind is that the delivery vehicle distributes the product to the customer till their doorstep, as the manufactured product are kept in the warehouse till the date of delivery.
Marketing and Sales: - The main focus of marketing and sales is to encourage customers to buy the product. Computer company in order to sell their product take up activities like advertising, promotion, sales force, where the buyers are encourage to purchase their product. Pricing of the product also helps in marketing and sales.
Services: - In the Computer industry service is something that plays a vital role as it helps in building a brand name for the company as well, all major companies tries to improve the quality of after sales services which enhance the value of the product. In this sector a company can only function if they keep their customer satisfied with their services like parts supply and product adjustment.
Support value activities involved in competing in any industry can be divided into four generic categories:
(Competitive Advantage - Michael E. Porter, 1985; Pg.: 41)
Firm Infrastructure: - Firm's infrastructure consists of a number of activities including general management, planning, finance, government affairs and quality management. Infrastructure unlike other support activities usually supports the entire chain and not just individual activities. Many infrastructure activities occur at both the business unit and corporate levels, however firms infrastructure is sometimes viewed only as "overhead", but can be a powerful source of competitive advantage.
Human Resource Management: - Human Resource Management involves in activities involving in the recruitment, hiring, training, development, and compensating all type of personnel. Human resource management supports both individual primary and support activities and the entire value chain.
Technology Development: - Technology development consists of a range of activities that can be broadly grouped into efforts to improve the product and the process. In case of computers we have seen a large change or growth in the technology and henceforth it supports the entire chain of e-business.
Procurement: - Procurement refers to the function of purchasing inputs in the firm's value chain, not to the purchased inputs themselves. Purchased inputs include raw materials, supplies and other consumable items as well as assets. Like all value activities, procurement employs a technology such as procedures for dealing with the vendors, qualification rules and information systems.
The internet allows customers to customize their product, but after placing the order for a particular desktop or laptop of a particular brand the company should adopt a method to provide service in the minimum span of time. The companies can adopt a method whereby the product could reach the customer from the nearest outlet of that particular brand which saves time and also satisfies the customer.
A customer while purchasing a desktop or any form of computer has several queries in mind before actually buying the product so company should conduct a meaningful dialog with the customer, obtaining information that answer their questions quickly, accurately and personally.
Many companies are not able to provide the customers the right type of configuration which the customers are looking for and as a result the customer has to be satisfied with something less than what he expects. In case of computers this is one issue that should be dealt with the configuration that the customer requires, as most companies try to target a particular segment of people.
Most of the computer company are adapting the dell's model to increase their sale as the company had used the adapting model as it focuses on low cost business model to offer customised products at a low cost and high quality and since many companies are trying to implement this strategy they are deviating from what customers want.
As there are many players in the field of computers, there is ought to be cut throat competition between all the leading brands. To make things more organised and authenticated websites must be ranked, so that customers are not cheated and fraudulent is prevented.
Reference # 1
Michael E. Porter (1985)
Creating and Sustaining Superior Performance
Publication: Free Press
New York, Collier Macmillan
A Division of Simon & Schuster, Inc.
Published in 1985'
Reference # 2
(Computer Industry Almanac, 1999; ET Forecasts, 2000, Pg.: 15)
Stuart Barnes and Brian Hunt (2001)
E - Commerce and V - Business
Business Models for Global Success
Publication: Butterworth Heinemann
A Division of Reed Educational & Professional Publishing Ltd.
Published in 2001'
Reference # 3
(C. Wilder, An Electronic bridge to customers, Information Week, 1995)
Elaine Lawrence, Brian Corbitt, Alan Tidwell, Jo-anne Fisher, John R. Lawrence (1998)
Digital Model for Business
Publication: John Wiley & Sons Australia, Inc.
Published in 1998
Reference # 4
Rensselaer; CSCI. 4210, Operating System Fall, 2009': Introduction, History of Operating System. (Fig 1: About ENIAC and its history)
Accessed: 12th October 2010'
Reference # 5
Michael Dell - Founder of Dell; Fig 2: Dell Inspiron - Base Model, Pc's with flat screen monitor; & Fig 2.1: Dell Studio
Available from: http://www1.euro.dell.com/content/products/features.aspx/deals5?c=uk&l=en&s=dhs&cs=ukdhs1&~ck=mn
Accessed: 15th October 2010'/Frequently