The Business Forum

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ELECTRONIC COMMERCE EXPLAINED

Contributed by Microsoft Corporation

 

Electronic commerce is doing business online.  It is about using the power of digital information to understand the needs and preferences of each customer and each partner to customize products and services for them; and then to deliver the products and services as quickly as possible. 

Personalized, automated services offer businesses the potential to increase revenues, lower costs, and establish and strengthen customer and partner relationships.  To achieve these benefits, many companies today engage in electronic commerce for direct marketing, selling, and customer service; online banking and billing; secure distribution of information; value chain trading; and corporate purchasing.

While the benefits of electronic commerce systems are enticing, developing, deploying, and managing these systems is not always easy. In addition to adopting new technology, many companies will need to reengineer their business processes to maximize the benefits of electronic commerce.

Microsoft’s electronic commerce strategy helps deliver a technology platform, a portal for online services, and a professional expertise that companies can leverage to adopt new ways of doing business.

Platforms are the foundation of any computer system. The Microsoft® commerce platform is a foundation of technologies and products that enable and support electronic commerce. With it, businesses can develop low-cost, high-value commerce systems that are easy to grow as business grows. The Microsoft commerce platform's breadth is unmatched, ranging from operating systems such as Microsoft Windows NT® Server to application servers such as Microsoft Site Server Commerce Edition and Microsoft SQL Server™ to applications infrastructure and development tools such as the Microsoft Visual Studio® development system. The Windows® Distributed Network Architecture (Windows DNA) provides tight integration and easy programmability across this platform, helping businesses implement commerce systems quickly and with reduced risk.

Portals are the crossroads of the Internet, where consumers gather and where businesses can connect with them. More than 40 percent of Web users in the United States visit the MSN™ network of Internet products and services each month. Through MSN, Microsoft can help any business generate an awareness of demand for its products and services.

Partners provide customers with a wide range of choices for professional implementation services and tightly integrated software for Microsoft commerce solutions. Independent software vendors (ISVs) have created specialized commerce software components that extend the platform. Microsoft Certified Solution Providers, systems integrators, and Internet service providers deliver the expertise companies need to develop, deploy, and host commerce systems. To ensure success, the Microsoft Solutions Framework provides guidelines and best practices for how these partners and businesses can work together to implement these solutions.

Microsoft’s combination of platform, portal, and industry partners can help any company implement highly effective, low-cost, electronic commerce systems. This paper details Microsoft’s strategy and priorities for electronic commerce, and also describes how the platform, portal, and partners are critical to solving business problems in the four most common areas of electronic commerce: direct marketing, selling, and service; value chain integration; corporate purchasing; and financial and information services.

WHAT IS eCOMMERCE

Doing Business on the Internet

Businesses communicate with customers and partners through channels. The Internet is one of the newest and, for many purposes, best business communications channel. It is fast, reasonably reliable, inexpensive, and universally accessible—it reaches virtually every business and more than 100 million consumers. Doing business online is electronic commerce, and Microsoft has identified four main areas where companies conduct business online today: direct marketing, selling, and service; online banking and billing; secure distribution of information; and value chain trading and corporate purchasing.

Direct Marketing, Selling, and Service

Today, more Web sites focus on direct marketing, selling, and service than on any other type of electronic commerce. Direct selling was the earliest type of electronic commerce, and has proven to be a stepping-stone to more complex commerce operations for many companies. Successes such as Amazon.com, Barnes & Noble, Dell Computer, and the introduction of e-tickets by major airlines have catalyzed the growth of this segment, proving the reach and customer acceptance of the Internet. Across consumer-targeted commerce sites, there are several keys to success:

  • Marketing that creates site visibility and demand; targets customer segments with personalized offers; and generates qualified sales leads through observation and analysis of customer behavior.

  • Sales-enhancing site design that allows personalized content and adaptive selling processes that do more than just list catalog items.

  • Integrated sales-processing capabilities that provide secure credit card authorization and payment, automated tax calculation, flexible fulfillment, and tight integration with existing back-end systems such as inventory, billing, and distribution.

  • Automated customer service features that generate responsive feedback to consumer inquiries; capture and track information about consumer requests; and automatically provide customized services based on personal needs and interests.

This business-to-consumer electronic commerce increases revenue by reaching the right customers more often. Targeted and automated up-selling and cross-selling are the new fundamentals of online retailing. Sites that most frequently provide the best and most appropriate products and services are rewarded with stronger customer relationships, resulting in improved loyalty and increased value.

Financial and Information Services

A broad range of financial and information services are performed over the Internet today, and sites that offer them are enjoying rapid growth. These sites are popular because they help consumers, businesses of all sizes, and financial institutions distribute some of their most important information over the Internet with greater convenience and richness than is available using other channels. For example:

  • Online Banking. Consumers and small businesses can save time and money by doing their banking on the Internet. Paying bills, making transfers between accounts, and trading stocks, bonds, and mutual funds can all be performed electronically by using the Internet to connect consumers and small businesses with their financial institutions.

    •

  • Online Billing. Companies that bill can achieve significant cost savings and marketing benefits through the use of Internet-based bill-delivery and receiving systems. Today, consumers receive an average of 12 bills a month by mail from retailers, credit card companies, and utilities.      
        

  • Secure Information Distribution. To many businesses, information is their most valuable asset. While the Internet can enable businesses to reach huge new markets for that information, businesses must also safeguard that information to protect their assets. Digital Rights Management provides protection for intellectual and information property, and is a key technology for secure information distribution.

The Internet offers tremendous time and cost savings for corporate purchasing of low-cost, high-volume goods for maintenance, repair, and operations (MRO) activities. Typical MRO goods include office supplies such as pens and paper, office equipment and furniture, computers, and replacement parts. The Internet can transform corporate purchasing from a labor- and paperwork-intensive process into a self-service application. Company employees can order equipment on Web sites; company officials can automatically enforce purchase approval and policies through automated business rules; and suppliers can keep their catalog information centralized and up-to-date. Purchase order applications can then use the Internet to transfer the order to suppliers. In response, suppliers can ship the requested goods and invoice the company over the Internet. In addition to reduced administrative costs, Internet-based corporate purchasing can improve order-tracking accuracy; better enforce purchasing policies; provide better customer and supplier service; reduce inventories; and give companies more power in negotiating exclusive or volume-discount contracts.

Value Chain Integration

No other business model highlights the need for tight integration across suppliers, manufacturers, and distributors quite like the value chain. Delays in inventory tracking and management can ripple from the cash register all the way back to raw material production, creating inventory shortages at any stage of the value chain. The resulting out-of-stock events can mean lost business. The Internet promises to increase business efficiency by reducing reporting delays and increasing reporting accuracy. Speed is clearly the business imperative for the value chain.

Unfortunately, speed can be costly. Today, approximately 50,000 businesses exchange business documents such as orders and invoices with their trading partners through a standard communication and content protocol called Electronic Data Interchange (EDI). Most EDI implementations use leased lines or Value Added Networks that require significant integration for each trading partner. Network design, installation, and administration can be costly in terms of hardware, software, and staff. In fact, these costs are the key reason that EDI is most widely deployed only in larger companies.

Moving forward, all companies will be able to take advantage of value chain integration through the low cost of the Internet. Open standards for electronic document exchange will allow all companies to become Internet trading partners and function as suppliers, consumers, or both in this business-to-business electronic commerce. This integrated trading will tighten relationships between businesses while offering them greater choices in supplier selection.

Issues in Implementing Electronic Commerce

Although it is simple to describe their benefits, it is not nearly as easy to develop and deploy commerce systems. Companies can face significant implementation issues:

  • Cost. Electronic commerce requires significant investments in new technologies that can touch many of a company’s core business processes. As with all major business systems, electronic commerce systems require significant investments in hardware, software, staffing, and training. Businesses need comprehensive solutions with greater ease of use to help foster cost-effective deployment.

  • Value. Businesses want to know that their investments in electronic commerce systems will produce a return. Business objectives such as lead generation, business-process automation, and cost reduction must be met. Systems used to reach these goals need to be flexible enough to change when the business changes.

  • Security. The Internet provides universal access, but companies must protect their assets against accidental or malicious misuse. System security, however, must not create prohibitive complexity or reduce flexibility. Customer information also needs to be protected from internal and external misuse. Privacy systems should safeguard the personal information critical to building sites that satisfy customer and business needs.

  • Leverage Existing Systems. Most companies already use information technology to conduct business in non-Internet environments, such as marketing, order management, billing, inventory, distribution, and customer service. The Internet represents an alternative and complementary way to do business, but it is imperative that electronic commerce systems integrate existing systems in a manner that avoids duplicating functionality and maintains usability, performance, and reliability.

  • Interoperability. When systems from two or more businesses are able to exchange documents without manual intervention; businesses achieve cost reduction; improved performance; and more dynamic value chains. 

Failing to address any of these issues can spell failure for a system's implementation effort Microsoft's commerce strategy is designed to address all of these issues to help customers achieve the benefits of electronic commerce.

Microsoft’s vision for electronic commerce is to help businesses establish stronger relationships with customers and industry partners. Microsoft’s strategy for delivering this vision is described by three elements—platform, portal, and industry partners—each backed by comprehensive technology, product, and service offerings. 

Microsoft has a strong history of developing platform products. The MS-DOS® platform fueled the PC revolution and the Windows operating system has done the same for 32-bit computing. From these past experiences, Microsoft has developed a great understanding of what a platform should deliver—a foundation for building solutions that are easy to develop, manage, and grow, and compliant with open standards. Microsoft’s electronic commerce platform accomplishes these goals with several key building blocks: Windows-based clients for consumer and business access to the Internet; Windows NT Server and the BackOffice® family for server applications; and Visual Studio for applications development. Across these elements, the Windows Distributed Network Architecture provides the infrastructure for integrating and extending these platform elements and for leveraging investments in existing systems.

Windows and Commerce Clients

Windows provides consumers and businesspeople with access to Internet-based commerce applications. A variety of Windows-based initiatives are expanding the market for electronic commerce by widening the range of options and lowering the price for consumer Internet access. For example, the Microsoft WebTV® Network service provides rich Internet access over conventional televisions at a price much lower than over personal computers. The Microsoft Windows CE operating system delivers Internet access for a number of consumer devices. The Microsoft Smart Cards for Windows platform provides secure storage for personal and payment information. Across this wide range of form factors, the Windows platform helps ensure secure, private, and inexpensive consumer access to the Internet. Specific examples of these benefits include:

  • Browsing Security. Consumers’ privacy for Internet communications is enhanced when Web sites take advantage of Windows support for Secure Sockets Layer (SSL). SSL is an Internet standard for encrypting information shared between browsers and Web sites.

  • Payment Security. The Passport wallet service facilitates e-commerce by making it faster, easier, and safer for consumers to exchange credit card and address information with participating merchants from anywhere in the world. The server-side wallet enables consumers to enter their information once, and then provide that information to merchants at the time of purchase conveniently and securely. The Passport wallet service supports all common browsers and the consumer does not have to download or install any additional software.

Merchants can use the Passport wallet service without installing any new software on their site. All they need to do is include a Passport wallet button or link and POST data to streamline the shopping experience at their site for millions of customers.  The Passport wallet also supports the new Electronic Commerce Modeling Language  (ECML) universal format for exchanging commerce information between digital wallets and merchant Web sites. ECML uses a set of standardized field names that streamlines the process by which merchants collect electronic information for shipping, billing, and payment. 

Passport uses the Triple DES algorithm to encrypt consumers' credit card numbers in the database.  Passport members can send wallet information to participating sites only by using SSL encryption.

  • Privacy. Personal user information can be shared securely using the Windows support for the Platform for Privacy Preferences (P3P). P3P is a new standard designed to enhance and encourage business-consumer personal information sharing by giving Web users the ability to control how their private information is shared online.

  • See:  

http://www.microsoft.com/windowsce

http://www.microsoft.com/wallet

http://www.microsoft.com/smartcard

http://www.webtv.com
 

Back Office

The Microsoft BackOffice server-application platform provides a wide range of products for implementing electronic commerce systems. The platform’s commerce features—its ease of use, integration, and ability to interoperate with existing systems—are all the best of breed. The BackOffice products central to building scalable, robust commerce systems are: Windows NT Server for applications server and Web sharing; Site Server Commerce Edition for commerce site management; and Microsoft SQL Server™ for storing a company’s product and customer information.

Windows NT Server is the foundation for Microsoft commerce applications. It delivers the ease of use and low cost those are the hallmarks of all Microsoft products. In addition, it offers the scalability and robustness required to support mission-critical commerce applications. Some of the world’s largest online businesses—Dell Computer Corporation, for example—have implemented their electronic commerce systems on Windows NT Server.

Windows NT Server integrates technologies that simplify the development and deployment of commerce systems that, in turn, facilitate the integration of commerce systems with existing back-end commerce applications. Consequently, Windows NT Server promotes the interoperation of commerce systems with the trading applications of business partners. For example:

  • Component Object Model (COM) is the Microsoft software architecture for component-based computing and is one of the richest, easiest to use, and most widely implemented component model. Components are programming constructs that represent real-world entities such as customers or products. Developers can create and customize them and then assemble them into applications. The Microsoft Windows platform is built on a foundation of components, which delivers COM benefits such as simplified maintenance, easy customization and extensibility, and code reuse to applications built and executed in a Windows environment. COM development encourages best practices in distributed and Web-based application design, and provides businesses the flexibility they need to change their electronic commerce systems when business conditions change.

  • Microsoft Transaction Server (MTS), a service of Windows NT Server, ensures the integrity of electronic commerce transactions. Significantly, MTS provides the technology to create and manage a scalable, shared, multi-user, multiserver-processing environment. MTS can virtually eliminate infrastructure coding and significantly reduce administrative overhead. As a result, electronic commerce systems can be developed more quickly and provide better performance, scalability, and reliability at run time.

  • Microsoft Message Queue (MSMQ) is a Windows NT service that provides guaranteed, transactional, asynchronous communication of messages between distributed programs. Like MTS, MSMQ reduces coding and administration. MSMQ can shorten the time needed to develop electronic commerce systems, especially those that implement value chains.

  • SNA Server 4.0 is a BackOffice product that integrates applications for Windows NT with an IBM mainframe and AS/400 applications. SNA Server implements the complex program-to-program, program-to-data, and program  to terminal protocols of IBM’s System Network Architecture. The product insulates developers from the details of these protocols, simplifying communication between Windows NT, IBM MVS and AS/400 systems. 

  • Microsoft COM Transaction Integrator for CICS and IMS (COMTI) builds on the connectivity and communication of SNA Server and the distributed transaction-processing capabilities of MTS, providing access from Windows NT-based applications to applications deployed within the two most popular mainframe transaction-processing (TP) environments—CICS and IMS/TM. COMTI insulates developers from the complexities of these environments, making their programs appear as the COM components that constitute native MTS transactions. COMTI enables the integration of Windows NT-based electronic commerce applications with existing CICS and IMS applications through drag-and-drop techniques. Together MSMQ, SNA Server 4.0, and COMTI help businesses leverage existing systems when deploying electronic commerce solutions.

  • See: http://www.microsoft.com/ntserver for more information.

Database systems are the engines that manage the volumes of information required to run businesses online. Microsoft SQL Server performance, scalability, and tight integration with Windows NT Server and Site Server Commerce Edition make it very well suited for powering electronic commerce systems. For example, the SQL Server full-text search and English query give shoppers the power to search for products while using plain English, consequently enhancing their shopping experiences. SQL Server online and incremental backup and restore capabilities improve system availability and reduce management costs. Businesses can mine customer data by using the SQL Server Decision Support Server with Online Analytical Processing (OLAP). In addition, Site Server Commerce Edition provides sample sites that are distributed in SQL Server format. These sample sites are the building blocks for many operational commerce sites, and can be used as learning aids, templates, and reusable components to speed site deployment.

Note that databases that store and manage electronic commerce information complement but do not replace a company’s existing database systems. No conversion or migration of existing systems is required.

 

Site Server 3.0 Commerce Edition

Microsoft Site Server 3.0 Commerce Edition is the comprehensive commerce server for conducting business online. It provides the business intelligence for doing business online. Site Server Commerce Edition manages customer profile information and site personalization; supports marketing and ad campaigns; runs storefront operations (including catalog management and shopping cart functionality); and provides analysis tools to understand consumer behavior. Behind the scenes, Site Server Commerce Edition controls how all parts of a commerce system interoperate, managing Web site content, sending instructions and information to a database server, and exchanging key business documents with trading partners. Because Site Server Commerce Edition is designed around the Windows Distributed Network Architecture as a set of COM component frameworks and uses the building blocks of Windows interoperability: COM, MTS, MSMQ, COMTI, and SNA Server, it is the easiest platform for corporate developers to integrate into their existing systems.

The Commerce Interchange Pipeline (CIP) is perhaps the most significant new feature of Site Server 3.0 Commerce Edition. The CIP provides an environment for the automated exchange of business documents (purchase orders, invoices, receipts, shipping notices, for example) between a company and its trading partners. CIP is implemented as a set of COM components that perform key message exchange functions—encryption, authentication, data transformation, auditing, and data transfer. The CIP is a framework that facilitates and simplifies the tasks required to develop interoperable trading applications.

Visual Studio

Investments in development expertise are highly valuable to most corporations. Microsoft has made great efforts to protect these investments by standardizing programming environments across many languages. Visual Studio is the cornerstone of this effort and is of prime importance when developing electronic commerce applications. Visual Studio helps programmers get up to speed more quickly and transfer code and knowledge across applications more easily. Its strengths lie at the heart of commerce system development needs—Web content customization and management; user interface design; data access; integration with existing systems; and inter-application communications. Visual Studio includes the Visual Basic®, Visual C++®, Visual FoxPro®, Visual InterDev™, and Visual J++™ development systems. Visual Studio ensures that developers always have the right tools to meet their commerce development needs.

Portal

Standard Initiatives

Standards lower costs, increase choices, and simplify integration and interoperability for businesses implementing electronic commerce systems. Microsoft is active in standards initiatives that address security; secure payments, privacy, and data interchange. For example:

  • The next version of Microsoft Wallet http://www.microsoft.com/wallet will implement Secure Electronic Transactions (SET), a standard for secure, authenticated transmission of payment information.

  • Windows supports Platform for Privacy Preferences (P3P), a software specification of the World Wide Web Consortium designed to help ensure the protection of consumers’ privacy. 

  • Microsoft has helped lead the industry in establishing Extensible Markup Language (XML) (http://www.microsoft.com/xml), a powerful means of representing structured data to support interchange of business information between companies.

  • For corporate purchasing, Microsoft supports the Open Buying on the Internet (OBI) standard, designed to standardize transactions between buying organizations and suppliers.

  • For information on the Microsoft platform euro currency symbol handling, see http://www.microsoft.com/euro for details.

MSN - The Microsoft Network

Markets are where customers and vendors meet. One of the most well traveled markets on the Internet is the MSN network of Internet products and services. MSN gives consumers the ability to do online research, shopping, and buying for a wide range of products and services, all from one convenient location. Because more than 40 percent of Web users in the United States visit MSN each month, MSN can help any business generate awareness and demand for products and services with a large and qualified target audience. MSN advertising, partnership, and small business services help companies reach, build, and strengthen relationships with their customers. The Microsoft Online Sales Team can work with any company to find the best online opportunities to meet specific marketing goals.

Advertising and Sponsorship

Businesses of all sizes and in all industries can generate demand through MSN by advertising their goods and services within its content. The six commerce sites of MSN offer significant advertising and sponsorship opportunities.

  • MSN CarPoint™ online automotive service helps consumers research, buy, and maintain a car, helping them save time and money, and avoid hassle.

  • MSN Expedia™ travel service helps customers search for and obtain a host of travel options including air travel, rental car reservations, and hotel reservations.

  • MSN HomeAdvisor™ online real estate service offers a complete guide to the home-buying process and provides comprehensive tools for finding homes and loans on the Internet.

  • MSN MoneyCentral provides complete one-stop personal finance resources from investing, to saving for college, to planning for retirement.

  • MSN allows consumers to shop for a host of top-quality products from some of the most popular online merchant sites. This commerce site is divided into 16 departments including books, music, clothing, computers, and gifts.

These commerce sites, in addition to other MSN network services, provide access to a large base of potential customers that can be segmented to match target markets based on rich demographics. For example, CarPoint tends to serve a young male audience, and young couples frequent HomeAdvisor. Recent data from @Plan shows that MSN users are more likely to make a purchase online than the rest of the Web population. In fact on some MSN sites, they are twice as likely to do so. The reach of MSN and the purchase behavior of its users demonstrate the business value of the Microsoft portal in generating demand and increasing sales.

Some examples of companies that leverage The Microsoft Network
 to generate demand online are: 1-800-Flowers, barnesandnoble.com,
First USA, Eddie Bauer, and John Hancock, etc. etc.

Recently, LinkExchange joined The Microsoft Network of Internet services. The LinkExchange flagship product, Banner Network, is an advertising network of more than 400,000 Web sites that reaches more than 21 million online consumers. The addition of the LinkExchange network expands MSN to include the hundreds of thousands of high-quality smaller sites that represent the heart of the Web.

Partners

More than 7,200 partners work with MSN today. MSN offers three types of vertical industry-specific commerce opportunities. These opportunities are linked to MSN's six electronic commerce sites.

  • First, MSN's electronic commerce sites generate qualified leads for partners. Initial shopping activities are conducted on the network’s electronic commerce sites. When consumers are ready for more serious shopping or are ready to make a purchase, MSN content directs them to partners’ sites. For example, on the HomeAdvisor real estate commerce site, home shoppers are linked to partner real estate brokers once they have selected the geographic location where they want to begin home buying in earnest.

  • Second, MSN can function as a direct channel for partners’ goods and services. For example, the Expedia travel commerce site sells tickets for airlines and makes reservations for hotels, rental cars, and a range of other partners in the travel industry.

  • Third, partners can provide their data or services to MSN's electronic commerce sites. Several of the electronic commerce sites integrate data and services from partners in order to provide the consumer offering. For example, MoneyCentral includes financial data from partners such as Standard and Poors and Comstock, and CarPoint provides used vehicle pricing from Kelley Blue Book.

All three of these partner opportunities take advantage of the wide reach of the MSN network of Internet products and services, the richness and attractiveness of its content, and the commerce services that it provides. With MSN, partner opportunities can lower the cost of implementing and maintaining electronic commerce systems and enhance their value.

See http://www.microsoft-online-sales.com for more information about advertising, sponsorship, and partnership.

Small Business Services

MSN LinkExchange delivers services to help Web site owners and small businesses generate demand and increase online revenues. More than 800,000 customers have used one or more of the following MSN LinkExchange services:

  • Express Store. Small businesses and Web site owners increase traffic by buying online ad campaigns that fit their budgets ($50 to $1,000) on leading Web sites. 

  • Submit It! Site owners increase online exposure by quickly and easily submitting their Web sites to their choice of more than 400 search engines.

  • ClickTrade. Small businesses create their own affiliate programs to expand revenues through referrals from other Web sites. 

  • Merchant Planet. Small businesses easily create an online store and accept credit cards to sell merchandise online.

See http://www.linkexchange.com for more information.

 

TransPoint

TransPoint is a joint venture between Microsoft and First Data Corporation that offers an Internet-based bill delivery and payment service called TransPoint e-Bills. TransPoint e-Bills is designed to make the payment process faster, simpler, more efficient, and less costly for companies of all sizes in industries that perform billing. Financial institutions of all sizes that support consumer and small-business customers can also use this service. For a fee per bill that is approximately the same cost as postage for paper-based billing, TransPoint delivers electronic versions of bills, and then returns payment and remittance information.

For billers, TransPoint can produce significant savings. Costs for sending bills and receiving payments can be reduced by 50 to 75 percent compared with the traditional paper- and mail-based billing approach. In addition, TransPoint graphically rich bills can be tailored to provide personalized, interactive marketing mechanisms for billers.

Microsoft commerce partners are a critical element of the Microsoft commerce strategy. They provide customers with essential products and services for implementing commerce solutions on the Microsoft platform and portal. Customer choice and competitive pricing are the hallmarks of the Microsoft partner channel, the deepest and broadest partner channel of any software vendor. Commerce partners are no exception to this rule, and they provide support in four important areas: independent software development, Web development, enterprise development, and commerce hosting and operation.

Independent Software Vendors

Today, more than 100 independent software vendors are working to extend and integrate the Microsoft commerce platform. They are building and delivering horizontal and vertical industry-specific applications that provide special functionality (such as international tax calculations or shipping rates) or assist with integration (such as interfaces with popular ERP packages). The range of these solutions is extensive and includes payment, tax, shipping, logistics, procurement, accounting, enterprise resource planning, and EDI.

The Value Chain Initiative (VCI) demonstrates the independent software vendor momentum behind Microsoft’s commerce efforts. VCI was created to establish a technology and standards framework for trading between business partners over the Internet. It has become a cooperative effort of 180 companies including systems integrators, hardware vendors, universities, standards bodies, and most significantly, the companies using VCI technologies and products. The VCI framework is based on the Microsoft commerce platform: a COM architecture, Windows NT Server, Microsoft SQL Server, Microsoft Transaction Server, Microsoft Message Queue, and Site Server Commerce Edition. The key technology for the VCI is Site Server Commerce Edition Commerce Interchange Pipeline. VCI complies with key industry standards for commerce and also establishes relationships with other prominent standards organizations such as Automotive Industry Action Group (at http://www.AIAG.org), Association for Retail Technology Standards (ARTS), RosettaNet (an IT industry standards effort, at http://www.Rosettanet.org), and Voluntary Interindustry Commerce Standards (at http://www.VICS.org).

VCI is not just the specification for a framework, but also includes sponsorship of proof of concept demonstrations, pilot projects, and evaluation laboratories. These efforts prove the worth of Internet-based value chain integration and identify the best practices for complex integration and interoperation. VCI helps participating businesses reduce risk, costs, and time associated with implementing electronic commerce value chains.

Web Developers

Microsoft Certified Solution Providers (MCSPs) consult, design, develop, implement, and maintain some of the most well-known sites on the Web. For example, the Staples and Eddie Bauer Web sites were both developed by MCSPs. MCSPs build solutions based on Microsoft products and technologies, capitalizing on their experience and skills in addition to their relationship with Microsoft. More than 15,000 MCSPs worldwide help customers achieve their goals, and more than 100 specialize in implementing Microsoft commerce solutions.

Enterprise Developers

Microsoft’s systems integrator (SI) program is designed to help the largest companies implement electronic commerce solutions. Through relationships with the systems integrators that address this enterprise market and through investments in their market-focused initiatives, Microsoft seeks to provide replicable, high-end solutions by aligning its resources to support market-focused initiatives of these partners. More specifically, Microsoft has established relationships with 13 SIs and invested more than $300 million in programs for training and certification, solutions development, marketing and demand generation, and providing access to the resources of the Microsoft Consulting organization. Several SIs have created very attractive commerce-specific initiatives. For example:

  • Cambridge Technology Partners provides consulting services to implement solutions in the new business ecosystems/electronic commerce market. These services include the architecture, design, development, integration, deployment, and management of applications that enable an interacting community of business partners to leverage brand and Internet technologies to their business advantage.

  • Compaq Computer Corporation, the first Worldwide Prime Integrator for Windows NT, delivers Microsoft-based commerce solutions to many of the world’s most successful electronic commerce businesses today. Compaq's commerce portfolio includes a Site Server-based corporate purchasing solution, and the Complete Commerce storefront package, in addition to hardware, software, and services.

  • Amdahl and DMR Consulting are offering electronic commerce and Web-to-host solutions. Amdahl and DMR Consulting will work with customers to integrate commerce Web sites with legacy database and transactional systems by using Microsoft Site Server Commerce Edition and Microsoft Transaction Server.

  • Ernst & Young offers a program called eCommerce RapidStart that takes a quick practical approach to business-to-business commerce rather than the lengthy and expensive learn, study, evaluate, and pilot approach that is so common when large corporations contemplate new technologies.

  • KPMG Consulting offers business-to-business extranet solutions based on Site Server Commerce Edition. KPMG can deliver solutions supporting electronic storefronts, electronic financial services, electronic transaction processing, extended enterprises, and online services and information publishing.

  • NCR provides Customer Relationship Management (CRM) RightSTART. CRM RightSTART is a program based on NCR and Microsoft technologies and services that allows businesses to track their customers through every interaction—from a purchase over the Internet to a call to customer-service call, to a visit to a retail outlet by leveraging the NCR data warehouse.

  • USWeb provides business-to-business and business-to-consumer commerce solutions based on Site Server Commerce Edition. In addition, USWeb Electronic Services offers a set of externally managed, custom, and packaged Internet applications that extend the reach and capabilities of corporate IT.

Commerce Hosting and Operation

Internet service providers (ISPs) have traditionally provided Internet access and 24x7 hosting and operation facilities. Recently, these telecommunications companies, cable companies, and enhanced services providers have also begun to offer a range of commerce-related value-added services. These value-added services make it easier and less costly for businesses to implement and to conduct business-to-consumer electronic commerce.

A number of ISPs offering Microsoft solutions are available worldwide to help companies maintain and operate 24x7 online businesses. A few of these companies are:

·         AIS

·         Concentric

·         Digex, Inc.

·         Data Return

·         GTE Internetworking

·         Icon CMT

·         NorthWest Nexus

·         USInetworking 

·         USWeb

·         UUNet

Please see http://www.microsoft.com/isn and link to Network Services Solutions and Commerce Hosting for more information about these and other Internet service providers.

CONCLUSION

Microsoft’s electronic commerce strategy—platform, portal, partners—enables businesses of all sizes in all industries to build solutions that strengthen customer and partner relationships. The strength of this strategy is reflected in how Microsoft customers are implementing electronic commerce solutions today in direct marketing, sales and service, financial and information services, corporate purchasing, and value chain management. The success of our customers is driven by how Microsoft’s strategy addresses the issues critical for successful electronic commerce implementations.

Cost

The Microsoft commerce platform reduces the costs of electronic commerce systems by delivering comprehensive functionality and integration capabilities. The flexibility of the Windows Distributed Network Architecture (Windows DNA) lowers the cost of future system changes. Windows is a well-known environment, which minimizes development and training costs. The Microsoft platform scales easily through the appropriate addition of hardware.

MSN provides a variety of services designed to deliver a high volume of customer access at a low price. Its demand-generation services lower the costs of acquiring new customers. TransPoint helps companies and financial institutions lower costs by delivering bills electronically.

Partners provide low-cost access to commerce expertise and custom software development for businesses implementing electronic commerce solutions. Independent software vendor products that plug in and extend the platform often eliminate the need for businesses to develop custom software. The expertise and experience of solution providers, systems integrators, and Internet service providers can be leveraged to deliver electronic commerce systems on time and on budget.

Value

The comprehensive functionality of the Microsoft platform provides excellent value. The platform enables businesses to achieve their goals with minimal additional development and technology acquisition. The flexibility and modularity of COM and products such as Site Server Commerce Edition allow businesses to make changes to their systems when the need arises.

MSN delivers value through its demand generation, online banking, and billing services, which companies can use instead of having to build their own systems.

Businesses can take advantage of the electronic commerce expertise of industry partners to help achieve their electronic commerce objectives. Industry partners can reduce the risk involved in implementing electronic commerce systems and provide real business value.

Security

Windows provides the security Web users need to privately transmit personal and financial information to online businesses. Windows NT security facilities and Microsoft’s standards initiatives address security issues for businesses deploying commerce applications. The platform supports P3P to ensure consumers’ privacy and to help businesses comply with the correct privacy policies.

As a provider of online commerce services, MSN is committed to protecting consumers’ privacy and developing technology that gives them the most powerful, safe, online experience available anywhere on the Internet. Microsoft is a premier sponsor of TRUSTe, an independent, non-profit initiative that exists to help consumers feel confident about using the Internet for their communication, shopping, research and living. TRUSTe aims to build this confidence by promoting the principles of disclosure and fair information practices among the Web sites that participate in the program.

Industry partners can help businesses build high-security electronic commerce systems by following best practices identified by Microsoft. Because security standards and practices are always changing, the expertise and focus of Solution Providers, Internet service providers, and systems integrators can ensure that electronic commerce systems protect a business’s assets and ensure consumers’ privacy.

Leverage Existing Systems

Commerce systems must harness, but not duplicate the functionality of existing applications and infrastructure. COM delivers a range of integration technologies across the Microsoft commerce platform through its modularity and language-independence.

Microsoft independent software vendors have built COM solutions that extend the commerce platform. These solutions demonstrate the platform’s many points of integration into existing systems. The skill and experience of Microsoft Certified Solution Providers and systems integrators reduce the time and the risk of integrating new electronic commerce systems with existing business systems.

Open standards for data exchange are the key to building systems that work together with little custom modification. The entire Microsoft platform is designed around supporting and growing with open interchange standards. The Microsoft Commerce Interchange Pipeline (CIP) helps business-to-business communications through standards including EDI and XML. The ISVs of the Value Chain Initiative have tested and proven new standards for exchanging value chain information by using the CIP. Microsoft MCSPs and Systems Integrators are on the cutting edge of deploying systems that use these new standards for electronic commerce.

The Future

Moving forward, all businesses will be affected by the global move to electronic commerce. Business operations will change, and new processes will be created. Companies that start learning in this new environment today will be leaders in the future. By providing the electronic commerce products and services needed to strengthen customer and partner relationships, Microsoft and its partners are ready to help businesses make these transitions.

Useful Links: 

www.microsoft.com/business      

www.microsoft.com/industry
 

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