We are going through an awareness curve, which will Cater turn into

[earning curve and an implementation curve

AND
SUGGESTIONS
 Section-I
Summary
In this chapter, an attempt has been made to highlights the summary of results
and further concludes it by suggesting the strategies on the basis ofproblems identified
by the present study for the successful implementation of e-commerce in India. This
chapter has been divided into three sections. Section I, deals with the summary of results.
Section II discusses the strategies suggested by the researcher for the successful
introduction and implementation of e-commerce in India. Suggestions have been made
for business organizations, customers and government; and Section III concludes the
study.
The pervasiveness of information and communication technologies (especially
Internet and its enabled technologies) in the last few years has revolutionized almost
every aspect of our lives by making the things easier, faster, cheaper and more efficient
than the past. It is not only changing the way of life, but also changing the face of
business worldwide. The growth of Electronic Commerce (popularly known as
E-Commerce) as a business technology in last decade is the result of such IT driven
development, which is revolutionizing the business world. E-Commerce has produced a
revolutionary new way for businesses to communicate and interact with the customers
(B2C). E-Commerce technologies are also driving increase interactions among customers
(C2C), businesses (B2B) and between customers and businesses (C2B). It has power to
expand the businesses beyond the global boundaries by giving them a competitive edge
in the global marketplace. Businesses around the world are embracing this technology
with great zeal as they realize the potential it offers. The result has led to the emergence
of e-commerce as a major business strategy.
No industry in the world history has achieved a rapid growth in as short time as
e-commerce. Though only a few years old, e-commerce has taken off at an
unprecedented speed despite much skepticism and some initial hesitation. It is universally
accepted that world is in the grip of an e-commerce revolution. But, the hyper growth of
e-commerce is still an American and European Countries phenomenon and e-commerce
has not taken off in other parts of the globe, although some countries like Japan,
Australia, Canada, New Zealand etc. are rapidly joining the bandwagon. India is one of
the countries where this trend seems to be catching on. Indian companies are fast jumping
into the e-commerce boom, and adopting e-commerce as a business technology in the
same manner as in other parts of the world. The dawn of new era has already begun in
India and the driving engine is information technology.
In India, history of e-commerce is just a decade old. First initiative was taken by
Ministry of Commerce in 1994, by setting up of EDI (Electronic Data Interchange)
Council. The EDI Council has promoted the introduction of EDI and e-commerce in the
trade processes of various vital trading partners responsible for the regulation and
facilitation of international trade. But, a revolution came in the Indian history of
e-commerce when VSNL (Videsh Sanchar Nigam Limited) launched India’s first dial up
Internet access service in August 1995. But, Internet and e-commerce age did not really
dawn in India till 1997. A landmark came in the Indian history of e-commerce, when, in
November 1998, the government ended VSNL’s monopoly and allowed provisioning of

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Internet services by private operators; and then Indian Parliament passed the Information
Technology Act, 2000 to boost e-commerce and e-governance. By then, the net had
changed everything. Indian companies started realizing the applications of ICTs and
Internet and using these technologies as a part of their business strategy. Year 1999 and
2000 can be considered as a boom period of the Indian e-commence and dotcom
companies. During this period many Indian companies went online and many launched
their website to play pure electronic game. And, today almost every Indian company has
web presence.
As a result, e-commerce has registered rapid growth in India. Further, the studies
revealed that e-commerce has very bright future in India. In India, most revenue from
e-commerce transactions is generated by B2B and B2C models of e-commerce1. Thus,
the new business philosophy is here to stay and it is evolving rapidly, creating a wave of
change for the Indian businesses and organizations. Therefore, the present topic
(E-Commerce: Business Applications, Strategies, Challenges and Opportunities in India)
is quite interesting to study because of its relative newness and exploding growth rate in
India.
The review of literature also highlights that this particular field need
comprehensive study regarding many aspects of e-commerce pertaining business
applications, challenges, opportunities and strategies in India. Therefore, the researcher
has decided to work under the title “E-Commerce: Business Applications: Strategies,
Challenges and Opportunities in India”. The present study has made an attempt to
overcome almost all the limitations of the existing studies by taking into the
consideration: all types of industries; all level of management; both primary and
secondary data; and combination of behavioral, technical and managerial aspect of
e-commerce. Above all, the study has followed a macro approach by studying economic
implications of electronic commerce, electronic payment and security system and
E-Commerce infrastructure, so that the results of this study can be generalized in Indian
context. The broad objectives and hypothesis of the present study are as under:

Objectives of the Study

• To discuss the conceptual framework of e-commerce.
• To find out the various business applications of e-commerce in India
• To study the present status of e-commerce infrastructure in India.
• To discuss the framework of electronic payment systems and study the security
schemes to secure electronic payment.
• To find out the opportunities and challenges of e-commerce in Indian business
scenario.
• To study the economic and social implications of e-commerce.
• To find out as how e-commerce improves the quality of work
• To study the important aspects of e-commerce while entering in the world of
e-commerce.
• To study the satisfaction level of Indian online customers towards the services of
Indian dot com companies.

1 For details, please see, Section II of Chapter 1.

185
 Hypotheses of the Study
• There is no problem in the introducing/adoption of e-commerce in Indian firms.
• Adequate number of trained staff is not available to take care of e-commerce
technology and transactions in Indian firms.
• There is relationship between e-commerce and economic development.
• The small-scale industry is going to be benefited more as the technology size is
neutral.
• E-commerce will prove to be beneficial for the businesses, customers, employees,
society and economy as a whole.
• Customers are not satisfied with the services provided by the Indian dot com
companies.
Research Methodology2
The present research is mainly of quantitative nature, as most of the findings of
the present study are based on quantified measures. However, the researcher also
manipulates the causality and consequences, which also represents a sign of qualitative
research. In the present study, mainly exploratory research design has been adopted, as
the main purpose of this study is to gain familiarity with the various aspects of
e-commerce in Indian companies and to achieve new insights into it. Further, the study
formulates more precise research problem by developing hypothesis. Since the scope of
the study is very vast, the present study also represents some characteristics of descriptive
research design. In the present study, both types of sampling techniques have been used.
The selection of the units has been made on the basis of non-probability sampling
technique, viz, ‘convenience' sampling. To obtain the information from the various
respondents within the organizations (Top Management, Middle Management and Lower
Management), stratified sampling, which is the form of probability sampling, has been
used. Information from the customers has been collected by using non-probability
convenience sampling, though mainly the use of mall intercept survey. The present study
largely utilizes the primary data. Primary data has been collected3 through the well-
structured comprehensive questionnaire. Sets of two questionnaires were prepared which
have been given in Appendix I and II.
For analyzing the data, both simple and advanced statistical tools have been used.
In some cases simple statistics like average, percentage and weightage average scores,
mean score. The study also utilizes descriptive analysis to explain the selected variables
and cross tabulation to examine the relationship between variables. Exploratory research,

2 For details, please see, Section 2 of Chapter 2.

50 units, (manufacturing, trading, and services industries) with the representatives from large scale,
medium scale and small scale industries using e-commerce technology located in Haryana, Delhi and
Noida were chosen. Some of these industries were highly advanced in the use of IT, while many others
were not. The main respondents targeted were from the top management (President, Vice President, Chief-
Executive Officer, Managing Director or other top most authority of concerned organization), middle
management (Chief Information Officer, Chief Operation Officer, Head of Information Technology or
other top authority which comes in the hierarchy) and lower management (employees involved in the
process of electronic transactions, payment and handling e-commerce technology etc.). Total 150
concerned people were surveyed form the different type of organidsations.
The survey targets a sample population drawn from consumers who have experienced online purchasing in
India. To collect the information from the customers, 200 respondents were selected from Delhi, Haryana
and Noida.

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require some advanced tools; therefore to test the various hypothesis of the study,
non-parametric statistical tests based on Chi-square have been used. A five point Likert
scale has been used to measure the intensity of respondent’s attitudes towards the
selected attributes. Likert scale is qualitative in nature; a scoring system was adopted to
quantify them. The analysis has been also done by using SPSS statistical package.

Summary of Results
The present study provides a comprehensive view of e-commerce in India. The
study provides an innovative application framework that guides the migration from a
traditional business model to electronic commerce business model. It also provides a
picture of opportunities and challenges of e-commerce that the Indian firms face. The
study also incorporates the latest strategies and techniques gained from the experience of
the first generation of e-commerce. Further, study discusses some integral aspects of
e-commerce, like, business models of e-commerce, electronic payment and security
systems and e-commerce infrastructure. An attempt has also been made to study the
economic and social implications of e-commerce. The major strengths of the present
study is the way it has put together everything one might wish to know about the
e-commerce.
The main goal of the present research work was to study the ‘business application,
strategies, challenges and opportunities of e-commerce in the Indian context’. To attain
this goal, the present study carried 9 objectives and 6 hypotheses. A summary of results
(objective-wise) obtained is given as under:

I
Concept and Business Applications of E-Commerce in India
Op To discuss the conceptualframework of e-commerce
• As a fairly recently adopted term, E-Commerce is interpreted differently by
different experts and organizations. On the basis of review of various definitions
of e-commerce, it is revealed that for most experts and organizations, e-commerce
is: the electronic mode of buying and selling goods and services with or without
the help of the Internet. To them, e-commerce is more about technology, than the
business strategy. But, in reality e-commerce is more than that. The researcher has
made an attempt to define electronic commerce in a comprehensive manner.
According to the present study, e-commerce is lot more than computer, Internet,
software etc. In fact, it is a part of how you run your business. Thus, definition
that is likely to be acceptable by people involved in electronic commerce can be
as followed: The use of electronic communication resources (telex, facsimile,
electronic mails, telephone, computer, EDI, EFT, Internet etc.) especially Internet
and its enabled technologies to engage in the exchange, including buying and
selling of products and services requiring transportation, either physically or
digitally from location to location, usually for money. In a very broad sense,
e-commerce also refers to the effects that the electronic exchange of commercial
information may have on the institutions and processes that support and govern
the commercial activities. These includes organizational management,
commercial negotiation and contracts, legal and regulatory framework and
financial settlement arrangements among many others. But all these activities

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 cannot be measured exactly in term of money. Therefore, all such activities
cannot be covered under the concept of e-commerce, in a strict sense because
transactions should be usually in terms of money. This is the basic condition for
both traditional as well as e-commerce.
• After studying the various definitions of e-commerce, it is also observed that
concept of e-commerce in India is same as in other parts of the world and Indian
business organization is using e-commerce as a business technology in much the
same manner as in many other developing and developed countries. However, a
developing country like India has its own harsh reality regarding the implications
of e-commerce in India, and these aspects definitely have direct or indirect impact
on the mind of individuals and organizations, thereby on the meaning of
e-commerce. As far as concept of e-commerce is concerned researcher can
conclude that, India is neither far behind from other countries nor advanced; we
are fully able to understand this new business technology and able to keep pace
with time and technology.
• Like traditional forms of commerce, there are variety of different types of
e-commerce and many different ways to characterize these types. Studies
suggested that there are at least nine different categories of e-commerce models.
These are: These are: (I) B2B (II) B2C (III) C2B (IV) C2C (V) G2B (VI) B2G
(VII) G2C (VIII) C2G and (IX) G2G. Among all, B2B is the most popular model
(in the terms of total volume) of e-commerce. In fact, it is the oldest forms of
e-commerce business models. B2C is the second most popular (in terms of total
volume) and number one (in terms of number of transactions) forms of
e-commerce business models. The B2B and B2C forms of e-commerce covers 95
per cent of global volume and C2B and C2C forms of e-commerce cover very
insignificant 5 per cent of global commerce.
• Firms are interested in e-commerce because, quite simply, it can help increase
profits. All the advantages of e-commerce can be summarized in one statement:
e-commerce can reduce costs, increase sales and profits. These advantages are the
principle drivers of e-commerce adoption in the modem business organizations.
• In India, companies from various segments have actively prompted Internet
usage and e-commerce application. B2B e-commerce in India has registered a
very rapid growth in India within few years. This market is reinventing new
business models and has already begun to offer end-to-end e-commerce platform
for the entire buy cycle to business users. At the same time end users are also
forcing vendors to expand their service mix and to adopt new business models.
The growth of B2C is comparatively slow than the growth of B2B Model of
e-commerce. But, this is not to say that B2C e-commerce scenario has been bad in
India as heavily successful players like e-bay, indiatimes, naukri, shaddi,
makemytrip, rediff, yahoo, indiabulls, ICICI Direct and Indiamart has already
proved their potential. Growth in IT enabled sector like online stock trading,
online advertisings and BPO has been remarkable.
• On the basis of survey results, it is revealed that e-commerce is in its emerging
stages in India. More than half (52 per cent) of the surveyed firms introduced
e-commerce technology in their firms during the period of 1999-2002. Thus, in
real sense, this period is said to be the starting period of e-commerce in India.

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 Study also revealed that, most of the surveyed firms (78 per cent) introduced
e-commerce technology in a formal manner. Thus, for most of the Indian firms,
adoption of e-commerce is a formal process. Further, the study also concluded
that, for most of these organizations (64 per cent), introduction of e-commerce
was a process of between 6 to 18 months. It is observed that it is not only the sizes
of firms, which can be held responsible for the time taken into introduction of
e-commerce technology, but also the other factors like: nature of adoption, level
of adoption and overall capacity of the firm to launch e-commerce in their
organsations.
II
Business Applications of E-Commerce in India
O2'. To find out the various business applications of e-commerce in India
Section II and section III of the questionnaire I, included several questions
regarding the adoption/introduction and business application of e-commerce among the
surveyed firms. To identify the present status and application level of e-commerce in
India, several key parameters were gathered on the basis of literature review and experts
opinions. The responses to these parameters were collected, coded, tabulated and
analyzed. A summary of the results obtained from the analysis of data is give as under.
• Transactions Level: Most of the surveyed firms (44+22=66 per cent) reported
that, the level of e-commerce transactions has increased in the comparison to the
year of introduction of this technology in their firms. This growth lie in between
the 0-20 per cent and 20-40 per cent in the ratio of 2:1. The study also identified
the ranges of e-commerce transactions in Indian firms. It is revealed that, most of
the Indian firms (80 per cent) transact electronically between the ranges of 0-25
per cent of the total commercial transactions. One interesting result can be drawn
that, larger the size of the firms, more the electronic transactions. During the
survey it was found that large firms have more capacity to conduct business
electronically, as e-commerce requires huge investment and manpower to handle
e-commerce technology and transactions. And generally, it is out of the capacity
of the especially medium and small firms.
• Key Reasons: To increase the sale, lowering the overall costs of operations and
accessing and expanding the market reach are found key reasons behind the
adoption/applications of e-commerce in Indian firms. But, this is partially true in
the context of MNCs. To them accessing and expanding the market reach are the
most important reasons behind the adoption of e-commerce. Lowering the costs of
operations is found less important for MNCs as compared to the other types of the
firms.
• Participation levels of MNCs are highest (89 per cent) in using e-commerce
technologies. Participation levels of Indian large-scale companies are found high
(about 72 per cent). Middle scale firms are poorly participating (36 per cent) and
participation level of small-scale firms are very poor (only 19 per cent). An
overall participation level of Indian firms in these facilities is 48.66 per cent.
Based on the intensity of usage of these facilities, it is revealed that FAX, which
is the most traditional technology for conducting business electronically, is highly
used among all types of firms. 90 per cent of the surveyed firms having this
facility. Internet (70 per cent) and e-mail (68 per cent) is followed by FAX.

189
 Participation level towards the advance technologies like: ERP,
Video/Teleconferencing and Shopping Cards/Interactive Chat are most poorly
used facilities among medium and small-scale industries. No surveyed firms from
small-scale sector participate in these technologies. Participation levels in these
technologies among MNCs are good and encouraging among the Indian large-
scale firms.
• Applications Level: The study revealed that, MNCs are having very high level of
applications (99 per cent) of e-commerce technologies. Application level is found
high (76 percent) among the Indian large-scale firms. Medium scale firms are
having poor application level (29 per cent) and small-scale firms are having very
poor application level (13 per cent). An overall application level of these
technologies is 47.6 per cent.
Further, individual intensity of various parameters were measured and it is found
that, displaying the catalogue of online products and services (64 per cent) is the
major business applications for Indian firms. Exchanging data and information
(58 per cent) is again a very important business application of e-commerce. B2C
and B2B applications of e-commerce are followed by the exchanging data and
information. 56 per cent sample firms are using e-commerce for B2C and 54 per
cent are using e-commerce as B2B mode. It is also revealed that medium and
small-scale firms are poorly engaged in the advance applications like electronic
payment system, electronic order to from suppliers and C2B.

Ill
E-Commerce and Working Efficiency
O3: To find out as how e-commerce improves the quality of work
• The study revealed that, e-commerce improves the quality of work mainly by
cutting down of meetings, saving time and energy and providing better quality
information. It is also revealed that e-commerce is less helpful in improving the
management functions like specialization, directing, co-coordinating and
controlling.
• Further, it is identified, if not implemented properly, the results may be adverse.
Based on the opinion of surveyed firms, reduced level of working efficiency has
been observed. However, very few firms reported that e-commerce has negative
impact of the working efficiency. These firms reported very low level of (0-5 per
cent) negative impact of e-commerce technology on the working efficiency. The
firms belong to this category was mainly from the small scale.
• On the basis of survey result, it is also revealed that majority of the respondents
(53 per cent) did not experience any problems while working with e-commerce
technology.
• The study also identified the problems of employees while working with
e-commerce technology. High costs of operations of e-commerce technologies,
lack of skilled manpower to handle e-commerce technology and transactions, lack
of secrecy and lack of availability of quality devices are the major problems
identified by the study.

190
 • While studying the e-commerce facilitators, it was identified that e-commerce
improved the overall business process flow and save time. Improved internal
functions were also identified as important facilitators.
• During the survey it was observed that improving the quality of work is the most
important aspect of electronic commerce, and one of the main reasons behind the
adoption of e-commerce in any organizations. But, this aspect of e-commerce is
not gaining very popularity, due to the lack of concept of money measurement.

IV
E-Commerce Infrastructure in India
04: To study the present status of e-commerce infrastructure in India
To facilitate the proliferation of e-commerce, sound infrastructure, which mainly,
consists of technical, telecom and legal are required. Thus, with an objective to study the
present infrastructure of e-commerce in India in a systematic manner, e-commerce
infrastructure has been divided into three categories:
• A number of technologies are have converged to facilitate the proliferation of
e-commerce. Networking, computing, messaging and electronic payment systems
are at the core of e-commerce, where the most commonly used infrastructure is
Internet, Intranet, Extranet, Firewalls etc. However, these technologies are not
sufficient for e-commerce proliferation. Proper management of enterprise
information security resources is the need of hour. It is important to note that
technologies used in e-commerce are almost same in all the countries, however
does vary because of the availability of telecom infrastructure and adoption level
of e-commerce in any organization.
• Telecom infrastructure has registered rapid growth in India, within few years. No
doubt, government policies have had a very positive impact on the development
of e-commerce telecom infrastructure. However, still, even among many
developing courtiers, India’s telecom infrastructure is very poor. This is especially
true in the context of Internet penetration. In the world’s pie our share is almost
negligible. Even with the tremendous growth of telecom infrastructure, India still
lagged behind even among the Asia-Pacific Countries. But, the poor status of
telecom infrastructure also indicates that India has significant scope to grow,
where many other countries do not have so much. To maximize the efficiency of
every possible medium of transmission, including copper cable, fiber optic cables,
radio, Internet, telephone and satellite communications, the whole purpose of
enabling telecommunications need to be reexamined.
• India is among the first few countries, which have passed a separate law enabling
e-commerce and other IT enabled services. The IT Act, 2000 is quite
comprehensive and well defined. But there are many important issues of
e-commerce (e.g. Intellectual Property Rights, Data Protection, Domain Names
Disputes, Electronic Payment System, Data Protection, Protection of
E-Consumers, Privacy and E-Taxation), which are important for the development
of this new business technology, but not covered by the IT Act 2000. Added to
these issues, the Act is a set too far, the over complex provisions relating to
contract formation, the ties to particular technology in the regulation of digital
signatures, the over elaborate mechanisms for controlling certification authorities

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 and the attempts to define the technology stand in stark contrast to more
minimalist approaches adopted in other jurisdictions. Unless all these legal issues
are dealt with, e-commerce cannot really take off in India.
• On the basis, of responses of 150 respondents, it is revealed that the present status
of e-commerce infrastructure is of average level (52 per cent). In reality, Indian
government has taken number of initiatives to boost e-commerce infrastructure
and most of them were successful.
• Further, the study identified that the role of Indian government in boosting
e-commerce is active and supportive (58 per cent). But, it is poorly cooperative
with the market conditions.
IV
Challenges and Opportunities of E-Commerce in India
O5: To find out the opportunities and challenges of e-commerce in Indian business
scenario
As the present study identified that e-commerce is still a new phenomena, Indian
firms faces many challenges regarding the introduction and successful
implementation of e-commerce in India. Some of the challenges identified by the
present study are:
• It is identified that, planning regarding the introduction of e-commerce is not any
easy task among the surveyed firms. The study identified that, financial burden
(36 per cent) and psychological barriers (32 per cent) barriers are the major
challenges in the planning of e-commerce initiative. Lack of advice regarding the
planning of e-commerce initiative (14 per cent) is also identified as a major
problem in the planning of e-commerce initiative.
• Despite high perceived benefits and optimism, the level of adoption of
e-commerce by the Indian is very low. This could be due to a number of
constraints and barriers faced by them such as: lack of knowledge, security and
privacy, stringent requirement of the technology skills. To test this assumption
empirically, a null hypothesis was formulated. The responses to this hypothesis
was gathered and tested empirically by applying Chi Square (% ) Test. The result
is given as under:
Hypothesis 1; There is no problem in the introducing/adoption of e-commerce in
Indian firms.
Calculated Value of %2 : 40.56
Table Value of %2 at 5 % Level : 3.84
Degree of Freedom (df) : 1
Result: Since the calculated value of % (40.56) is much larger than the table value of %
at 5 % level of significance for 1 degree of freedom (3.84), therefore the null hypothesis
is rejected and it is concluded that: there is problem in the introduction/adoption of
e-commerce in Indian large scale, medium and small scale firms.
Further to study the association between level of management and problems of
e-commerce, %2 Test was applied on the responses of different levels of management. The
result is given as under:

192
Hypothesis 1 (a): There is association between the level of management and problems of
e-commerce.
Calculated Value of x2 : 1.535
Table Value of %2 at 5 % Level : 5.99
Degree of Freedom (df) :2
Result: Since the calculated value of x (1.535) is smaller than the tabulated value of % at
5% level of significance for 2 degree of freedom (5.99), therefore, the hypothesis is
rejected and it is concluded that: there is no association between the level of management
and problems of e-commerce. Thus, the problems of e-commerce exist in all level of
management. It is not specific to any particular level of management.
From the analysis of data, it is concluded that, there is problem in the introduction
of e-commerce technology in the Indian organizations. To identify the most dominating
inhibitors in the introduction/adoption of e-commerce in the Indian firms, 15 key
parameters were identified on the basis of literature review. The responses to these
parameters were gathered, coded, tabulated and weightage average of each parameter has
been calculated.
From the ranking of the weightage average score in the table, top five inhibitors
factors are identified. These are: (1) Difficulty in keeping pace up with changing
technology; (2) Difficulty in shifting mindset in using e-commerce technology; (3)
Difficulty in assessing tangible benefits accrued by e-commerce mode of transactions; (4)
Overall poor IT infrastructure and (5) High set up cost of e-commerce system. Low level
of readiness of major e-commerce institutions and long implementation time has been
identified as least inhibitor factors in the implementation of e-commerce in the Indian
firms. It is interesting to observe that, three main problems (which are ranked at number
1, 2, and 3) are more psychological than the technological or strategical. Further it is also
revealed that security and privacy is not the major issue of concerns for these firms.
• Studies indicate that availability of trained staff to handle e-commerce
transactions and technology is also a considerable problem for the Indian firms.
To test this assumption empirically, a Null Hypothesis was formulated. The
responses to this hypothesis was gathered and tested empirically by applying Chi
Square (%2) Test. The result is given as under:

Hypothesis 2: Adequate number of trained staff is not available to take care of

e-commerce technology and transactions in Indian firms.
Calculated Value of x2 : 2.16
Table Value of %2 at 5 % Level : 3.84
Degree of Freedom (df) :1
Result: Since the calculated value of %2 (2.16) is less than the table value of %2 at 5 %
level of significance for 1 degree of freedom (3.84), therefore the null hypothesis is
accepted and it is concluded that: adequate number of trained staff is not there to take
care of e-commerce in Indian firms.
Further to study the association between the level of management and problems
availability of staff, % Test was applied on the responses of different level of
management. The result is given as under:

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Hypothesis 3 (a): There is association between the level of management and problems of
availability of trained staff
Calculated Value of %2 : 3.084
Table Value of %2 at 5 % Level : 5.99
Degree of Freedom (df) :2
Result: Since the calculated value of %2 (3.084) is less the table value of %2 at 5 % level
of significance for 2 degree of freedom (5.99), therefore the hypothesis is rejected and it
is concluded that: there is no association between level of management and problems of
availability of trained staff.
From the analysis of data it is revealed that there is lack of trained staff in the
Indian firms to handle e-commerce transactions and technology. To identify the most
responsible factors behind this problem, 7 parameters were gathered on the basis of
literature review. Responses to these parameters were gathered from top management;
middle and lower management. Their responses were gathered and analyzed.
On the basis of ranking, 5 key reasons were identified behind the poor availability
of trained staff to handle e-commerce transactions and technology. These are: (1) high
cost of training; (2) staff is not qualified enough to adopt and learn new technologies (3)
reluctance of staff to adopt latest technologies; (4) low stability ratio of trained staff and
(5) problems in keeping up pace with the changing technology.

Opportunities of E-Commerce
In the present study, e-commerce opportunities have been studied in section IV of
questionnaire I. Several past studies revealed that, e-cornmerce can offer huge
opportunities for the Indian corporate sectors in the coming year and predict that
e-commerce is expecting to have bright future in India. Based on this assumption, several
key parameters were identified and responses to these parameters were gathered, coded,
tabulated and analyzed. A summary of the results obtained from the analysis of data is
given as under:
• From the ranking of the mean scores, three key reasons can be identified behind
the opportunities offered by e-commerce among the Indian firms are : (1) More
and more customers are shifting to the Internet/other ICTs for buying (2) Internal
benefits of using e-commerce technologies are motivating Indian firms to reap the
benefits of e-commerce and (3) Greater reach and easy accessibility of Internet
and other electronic communication resources will help Indian companies tap the
untapped Indian market. It is also found that encouragement of government is
least important reasons behind the opportunity offered by e-commerce in India.
• In order to analyze the key facilitators behind the adoption and implementation of
e-commerce in Indian firms, 20 facilitators from the review of literature and
experts opinions, were used and data from 150 respondents were gathered on a 5-
point Likert scale. From the ranking of the mean scores, top 5 e-commerce
facilitators were identified. These are: Improved overall business process flow
and save time (D3); reduced sales costs (A2); reduced marketing and distribution
cost; (A|); pressure and insistence for Electronic Commerce/mode by competitors
and foreign buyers (Ci) and improved internal functions (A5). Readiness of
concerned government agencies is found the least important facilitators behind the
application of e-commerce among all 20 facilitators.

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 • In order to identify the dominating cluster of facilitators, these facilitators were
divided into 4 broad categories. These are: cost reduction facilitators (A) market
facilitators (B) community and process driven facilitators (C) and technology and
organizational driven facilitators (D). From the ranking of the total mean score of
each cluster, it is identified that the cost reduction facilitators is the most
dominating facilitator behind the application of e-commerce among the Indian
firms. Technology and organizational facilitators is followed by cost driven
facilitators. In short, it is concluded application of e-commerce is facilitate more
by cost driven facilitators than the others.
• Past studies revealed that e-commerce is more beneficial for the small scale firms
as compared to the other types of firms. To test this assumption empirically, a
hypothesis was formulated. The responses to this hypothesis was gathered and
tested empirically by applying Chi Square (%2) Test. The result is given as under:
Hypothesis 3: The small-scale industry is going to be benefited more as the technology
size is neutral
Calculated Value of %2 : 0.96
Table Value of %2 at 5 % Level : 3.84
Degree of Freedom (df) :1
Result: Since the calculated value of %2 (0.96) is smaller than the table value of %2 at 5 %
level of significance for 1 degree of freedom (3.84), therefore the hypothesis is rejected
and it is concluded that: small scale industry is not going to be benefited more over the
other types of industry as the technology size is neutral
Further, to identify the areas where small scale firms can enjoy the benefits of
e-commerce over the other industries, 10 key parameters were identified on the basis of
literature review. The responses to these parameters were gathered on 5 point scale.
• From the ranking of the mean score, top 5 parameters were identified, where the
small scale firms can enjoy the special benefits over the other industries. These
are: (1) Making it Easier for the Artisans to access B2C World Market; (2)
Disintermediation (3) Increase Turnover; (4) Stay Ahead of Competitors and
(5)Reduced Working Capital and Inventory Requirement.
• The present study identified that; e-commerce has bright future in India, as he
number of internet users are growing rapidly and customers and companies are
shifting to the Internet for buying and selling. It is concluded that Indian firms are
very optimistic regarding the future opportunities of e-commerce in India. Highest
51 per cent respondents reported that e-commerce is expected to offer huge
business opportunities in the coming five years. It is also observed that MNCs and
Indian Large Scale firms are more optimistic regarding the future opportunities of
e-commerce in India. However, the observed (expected by the respondents)
growth level is not very attractive. Highest 61 per cent respondents reported the
future growth of e-commerce between the range of 0-25 per cent to the current
transactions.
• B2B (56.66 per cent) and B2C (33.33 per cent) model of e-commerce is expecting
to offer huge business opportunity in the coming five years. It is really very
interesting to note that Small Scale Firms are expecting high growth opportunity
in B2C models of e-commerce compared to MNCs, Indian Large Scale and
Middle Scale Firms.

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 Further, it is also revealed that B2B model of e-eommerce is going to offer huge
business opportunities for the manufacturing sector, as majority of the
respondents (48 per cent) reported the same. Service sector is followed by
manufacturing sector, ranked at number 2. It is also observed that MNCs are very
positive in all sectors, as little variation is noticed in their opinions. But high
variations is noticed in the opinions of Small firms, and it is observed that
manufacturing firms are expecting huge opportunities in B2B models of
e-commerce compared to service and other types of industries.
• In B2C model of e-commerce, highest opportunity is expected in the
Airline/Railway Tickets Reservations sector. It is ranked at number 1. This is
followed by Books, ranked at number 2. Musical products (CDs, Cassettes and
online music) are also expected to offer good opportunity in the coming years, for
the firms especially engaging in the B2C model of e-commerce. It is interesting to
observe that Videos/DVDs/Games, which are generally considered to offer huge
opportunity in the coming year, are ranked at number 7. Computer hardware and
software is also expected offer good opportunity in the coming years.
• Generally, it is stated that e-commerce is beneficial not only for the businesses,
but also have very positive impact on the other sector of society. To test this
assumption empirically, a hypothesis was formulated. The responses to this
hypothesis was gathered and tested by applying Chi Square (%2) Test. The result
is given as under:
Hypothesis 4: E-Commerce will prove to be beneficial for the businesses, customers,
employees, society and economy as a whole
Calculated Value of %2 : 6.82
Table Value of %2 at 5 % Level : 3.84
Degree of Freedom (df) : 1
Result: Since the calculated value of % (6.82) is much larger than the table value of % at
5 % level of significance for 1 degree of freedom (3.84), therefore the hypothesis is
accepted and it is concluded that: e-commerce will prove to be beneficial for the
businesses, customers, employees, society and economy as a whole.
From the analysis of data, it is concluded that respondents feel that e-commerce
will prove beneficial for the businesses, customers, employees, society and whole
economy. To identify the segment of Indian economy, where the positive impact of
e-commence can largely be noticed, 5 key parameters were gathered on the basis of
review of literature. The responses to these parameters were gathered on the 5 point scale.
From the ranking of the mean score, top three segments were identified. Theses
are: (1) E-commerce will prove to be beneficial for the businesses; (2) E-commerce will
prove to be beneficial for the customers and (3) E-commerce will prove to be beneficial
for the whole economy.
V
Economic and Social Implications
06: To study the economic and social implications of e-commerce
• The present study idenfied that, the emergence and rapid growth of Internet and
E-Commerce has strong implications on economic and social actitivities. It is
quite possible that these new technologies might transform the future of economic
and social landscape. At the economic front, there is a clear evidence that

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 E-Commerce and Internet techonolgy have positive impact. To study the
economic implications of e-commerce, few areas of economy (transportation,
Intermediation, Agriculture, Labour Market, Taxation, Cost, Price and
Competition, and money) has been selected. On the basis of various studies it is
revealed that e-commerce technology have strong economic implications. At the
general level, there are two types of potential economic gains from the use of
E-commerce and IT enabled technologies. First, are the gains in efficiency, both
in static and dynamic. Static gains are one-time, and come from more efficeint use
of scarce resources, allowing higher consumption in the present. Dynamics gains
come from higher growth, potentially raising the entire future stream of
consumption and population. Efficiency gains of e-commerce also come about
through the enabling of new digitized goods and services. The second type of
potential benefits comes from cost reduction. Studies indicates that e-commerce is
helpful in reduction of search cost, administration cost, distribution cost and even
the labour costs.
• However, all these opportuities are yet to materlize in to profitability i. e. in
agricultural sector, benefits of e-commerce exists, but, only theortically; not
practically, as the implemetnation of e-commerce technolgy in agricultural sector
has certin challenges. Addes to this, e-commerce based economic models has also
posed number of challenges before the concerned people and community. The
area of e-taxation is one of the best example and most controversial issue all over
the world. As e-commerce transaccends the barriers of geographical boundaries,
the concept like the place of transactions and place of consumption become
immaterial. With the emergence and growth of digital money in the economy, the
chances of frauds have also incresased. Another most difficult issue is the
planning regarding the adoption and implemetation of e-commerce technology in
the various economic activities. In nutshall, with the e-commerce based economic
models, there is little to lose and more to gain.
• At the social front, e-commerce and ICTs can definitely empower the poor, give
them a voice and connect them to the global world. These technologies can also
help in attaining a minimum level of education, health and nutrition. The ability to
participate in democratic decision making can also fall into this category. But it is
difficult to predict the extent to which these technologies will transform the
developing countries. On the basis of various studies, it is observed that, there is
very high costs and relatively low benefits of the direct Internet and e-commerce
technolgies to the poor or the other needy people. Access to radio and telephone
services show a higher benefit cost ratio and lower the overall costs as the
alternatives to and intermediaries for the Internet and e-commerce in poverty
alleviation and other social upliftment programmes.
• In a developing country such as India, it is of particular interest whether such
benefits can reach to the poor and even help directly or indirectly reducing the
deprivations assosciated with poverty. For example, better access to education,
agricultural market, information or to government services may be relatively more
valuable for the poor people who cannot afford to use the tradtional mehtods or

197
 communications media, or to pay for the services of tradtional facilitaing
intermediaries.
• In short, development of e-commerce and IT has great singinficance not only in
the economic growth, but also in human and social development. It boost social as
well economic infrastructure, generate revenue, provides employment and many
more. But the development of these technologies would remain uncomplete,
unless the benefits of these technolgies reaches to the common man.
• These technological developments (especially Internet) not only open the barriers
to the business community, sociaty as well as the whole economy, they also create
a thousand areas where crimes can proliferate. But, net can not be held
responsible for the cybercrime. In fact, it is the first global communication that
can be exploited in various ways. However, studies indicates that there is positive
correlation between the growth of Internet and crime, but, in reality poor security
system, lack of awamess, and poor legale system is the most responsible factors
for the growth of cyber crime. Therefore, there is a strong need for a dedicated,
continuous, updated training of the cyber law enforcement agancies. At the same
time it, it is necessary to train a pool of expertise so that necessary skills are
developed by all those who have to grapple with the problem fo cyber crime
including the policy maker, framers the judges, the lawyers and the
administravtive. All the more, the change will come only with awarness.
• Literature review strongly indicated that there is relationship between
e-commerce and economic development. To test this assumption empirically, a
hypothesis was formulated. The responses to this hypothesis was gathered and
tested empirically by applying Chi Square (%2) Test. The result is given as under:

Hypothesis 5: There is relationship between e-commerce and economic development

Calculated Value of %2 : 4.50

Table Value of x2 at 5 % Level : 3.84

Degree of Freedom (df) : 1
Result: Since the calculated value of x2 (4.50) is larger than the table value of %2 at 5 %
level of significance for 1 degree of freedom (3.84), therefore the hypothesis is accepted
and it is concluded that: there is relationship between e-commerce and economic
development..
From the analysis of data, it is concluded that there is relationship between
e-commerce and economic development. To identify the areas of Indian economy where
the relationship between these two factors can largely be seen, 12 key parameters were
gathered on the basis of literature review and experts opinions. The responses to these
parameters were gathered on 5 point scale.
From the ranking of the mean score, top five areas of Indian economy were
identified, where relationship of these parameters with e-commerce can largely be seen.
These areas are: (1) Reducing the Role of Intermediaries; (2) Export Opportunities; (3)
Development of Economic Infrastructure; (4) Overall Improvement in Economic
Efficiency and Productivity and (5) Increase in Employment Opportunities.

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 VI
Electronic Payment and Security Systems
O?: To discuss the framework of electronic payment system and study the security
schemes to secure electronic payment
• The present study revealed many electronic payment systems and broadly these
electronic payment systems can be grouped or classified into four categories: (1)
Online Credit Card Payment System (2) Online Electronic Cash System (3)
Electronic Cheque System and (4) Smart Cards based Electronic Payment
System. These payment systems have numbers of requirements: e.g. security,
acceptability, convenience, cost, anonymity, control, and traceability.
• Credit card is the most popular methods of payment over Internet. Internet
buyers seem to prefer credit cards to other electronic payment system that have
been made available to them. One reason may be the simple familiarity with the
credit card, as it is the oldest form of electronic payment system.
• On the basis of analysis it is concluded that, smart cards based electronic
payment system is best. It has numerous advantages over the other electronic
payment systems. It is expected that in the future smart cards will eventually
replace the other electronic payment systems.
• Monetary value, convenience, authorization, security, authentication, non­
refutability, accessibility and reliability and anonymity are the most desirable
properties of any electronic payment system. Functionally, money technologies
also need to achieve these operating characteristics: privacy, reliability,
scalability, ease of use, personalize-able, seamlessness, interoperability, and
cost effectiveness.
• It is also observed that different countries prefer the different forms of
electronic payment system. For most of the Indian online customers credit card
was the most used methods of payments, which is ranked at number 1. Debit
card was also highly used method of payment after credit card. Cash-on-
Delivery was also found very popular among the Indian online customers. In
short, it is revealed that for online buying, most of the customers use electronic
method of payment. Cash-on-Delivery is most popular method of payment
among the non-electronic payment methods.
Security Schemes/Systems
• Security of electronic payment in the e-commerce is the biggest issue of concern
not only for the developed world where most of the payment are made though
Internet; but also for the developing countries like India where very few people
are using electronic payment tools like credit cards etc. In the developed world
problem of security exists mainly due to high technological advancement whereas
in the developing country it is due to the lack of secure technologies and poor
awareness among the user and the companies.
• As the chances of risks are high and many in electronic payment system; it is
quite impossible to eradicate security breaches mainly because of majority of
them are as a result of human malice, error or lack of awareness. But this can be
minimized by introducing different layers of security in an organization to ensure
that, once all the measures are in place, if one layer is breached then the next layer

199
 will stand up and so on, until either the impact of the breach is at best detected
and disarmed or at worst cause minimum damage.
• Survey reports and personal experience repeatedly shows that many of the
security breaches that occur are as a result of people and most of the time they are
from the inside of company. Therefore, a general observation regarding the
behavior of employees should be considered as important tool of security.
However for the best result consumers (users), businesses, software developers
and government have to work together to make this new form of payment a
reality.
• An appropriate legal framework is very important for the development of this new
form of payment. Most of the counties of the world still do not have any law
regarding the protection of consumers in the age of e-commerce. Fortunately we
(India) do have, but our Information Technology Act, 2000 is silent about the
issue of electronic payment system. Therefore there is strong need to introduce
new laws regarding electronic payment and amendment is required in the existing
laws to create the trust among the users of new payment tools, which is the
fundamental condition for security. As there is no boundary in electronic
transactions (payments), action at international level is also needed to make the
electronic payment a reality all over the world.

VII
E-Commerce Strategies
• On the basis of the literature survey and experts opinions gathered during
interview, 12 management strategies were identified which were indicated as
primarily guiding e-commerce development in any organization. The response of
these strategies was gathered on a 5-point scale. From the ranking of the mean
scores, top 5 strategies were identified. These are:(l) E-commerce
implementation is perceived to increase organization’s competitive edge (2)
e-commerce implementation is determined by the top management (3)
e-commerce implementation is determined by the consultant (4) large investments
are made for e-commerce implementation and (5) e-commerce implementation is
determined by the middle management.
In order to identify the dominating cluster strategies, these strategies were divided
into 4 broad categories. These are: (1) CEO driven strategy (2) fall in line and
network driven strategy (3) middle management and customer driven strategy and
(4) investment driven and BPR driven strategy. From the ranking of total mean
score of each cluster, it is identified that CEO driven strategy are most used in the
Indian organizations which is followed by middle management and customer
driven strategy
• On the basis of literature of review and experts opinions, 10 internal factors of
strategic importance for the success of e-commerce were identified. The
responses to these factors were gathered from 5-point scale. From the ranking of
the mean scores, three key internal factors of strategic importance were identified.
These are: (1) security and privacy of payment and information; (2) human
resources and (3) quality of goods and services.

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 VIII
Online Shoppers Behaviors and Satisfaction
Og: To study the satisfaction level of Indian online customers towards the services of
Indian dot com companies
It is very important for the e-marketers to find out what factors make the
customers satisfied and what makes them unsatisfied. Keeping in view this aspect, an
attempt has been made in the present study to find out ‘whether the customers are
satisfied or not with the services of e-marketers’ and to study the level of'their
satisfaction and factors affecting their satisfaction. But, before going into the deep of this
discussion, it is also important to understand the ‘what Indian customer prefer to buy over
net?’ and what is their preferred method of payment?’. For this purpose a survey of 200
selected customers was administered. The results obtained from the survey are given as
under:
• Buying habits/pattems of customers’ across the globe is not same. In fact, it
widely varies with market. In order to study the most preferred items of purchase
over the Internet among the Indian customers, 15 items were identified on the
basis of literature review.
The study identified that airline/railway tickets is the most preferred items of
purchase over the Internet among the Indian customers.
Clothing/accessories/shoes are followed by purchase of airline/railway tickets. It
is also revealed that purchase of online subscription of journals and magazines is
high in India, which is ranked at number 3. Purchase of electronic equipment and
DVDs/Videos/Games are ranked equally.
• Several studies indices that online customers are not very satisfied with the
services of dot com companies. To test this assumption empirically, a null
hypothesis was formulated. The responses to this hypothesis was gathered and
tested empirically by applying Chi Square (%2) Test. The result is given as under:

Hypothesis 6: Customers are not satisfied with the services provided by the Indian Dot
Com Companies
Calculated Value of %2 : 7.22
Table Value of %2 at 5 % Level : 3.84
Degree of Freedom (df) : 1
Result: Since the calculated value of % (7.22) is much larger than the table value of % at
5 % level of significance for 1 degree of freedom (3.84), therefore the null hypothesis is
rejected and its is concluded that: customers are satisfied with the services provided by
the Indian Dot Com Companies.
Further to study the satisfaction level of customers regarding the services offered
by the dot com companies, 16 key factors were identified on the basis of review of
literature Factor one (A) is loaded on the first 7 variables. This factor can be labeled as
‘website design factors’, factor two (B) loaded on the next three variables. This factor can
be labeled as ‘reliability and fulfillment factor'. Factor three (C) is loaded on the next
three variables. This factor can be labeled as ‘customer services’ factor. Last factor four
(D) loaded on the last three variables and this factor can be labeled as ‘security and

201
privacy factor'. The responses to these factors ware gathered on the 5 point Likert scale.
Score 5, labeled, for the respondents who were strongly agreed; 4 for who were agreed; 3
for neither agreed nor disagreed; 2 for disagreed and 1 for strongly disagreed.
From the ranking of the mean score, top 5 factors were identified regarding which, the
India online customers were highly satisfied. These are: (1) the dot com companies
provides in depth information of product and services they offered (2) The company is
willing and ready to respond to customer needs (3) the website understands the customers
needs (4) online customers feel comfortable in surfing and (5) Enquiries are answered
promptly. It is also revealed that all three variables related to privacy security are having
least mean score. Therefore this problem is considered as most important. ‘The product
that came was represented accurately by the companies’ this variable is ranked at 15 on
the basis of mean score.
From the raking of the total mean score of each factor, following conclusion are
drawn. First, online Indian buyers rated the website design factors the highest mean
score, which implied that online buyers were highly satisfied with this area of service.
This factor (A) had very high mean score of 3.88 than the overall mean score of 3.785.
Second, website reliability and fulfillment factors rated at 3.77, which was slightly lower
than the overall mean score of 3.785. The satisfactions level regarding this factor is
ranked at number 3. Third, customer service factors rated at 3.83, which was slightly
higher than the overall mean score of 3.785, which implied that the customers are,
satisfied wit this area of service. Fourthly, compared with the perceived overall
perception of a website with a mean score of 3.785, online Indian customers rated the
website privacy and security factor at a considerable lower mean score of 3.66. The
considerably lower mean score of the privacy and security factor suggest that consumers
considered that factor to be possible obstacles in their online purchasing.

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 Part-II
Suggestions

The studies reviewed so far (Mukhopadhyay, 2002Arora and Banwet, 200312;

Sumanjeet, 20033; Sumanjeet, 20044; 5Arora, 1995'; Sawhney and Kaul, 20016; Lakshmi,
2001; Pani, 20027; Singh and Singh, 20048; Sengupta, 20049) and data revealed from
present study are able to indicate that e-commerce can offer huge opportunities for Indian
firms in the coming years. To capitalize these opportunities offered by e-commerce in
any organization requires sound e-commerce strategy, which may not be the same as the
traditional business strategy and further its successful implementation in any
organization. But, the successful implementation of e-commerce strategy is not an easy
task. Between 2001-02 several thousand Indian dot com companies died, mainly because
of the reason of poor implementation of e-commerce strategy and technology. In the
present study, the problems regarding the successful implementation of e-commerce has
been studied under two categories: (1) problems regarding
planning/introduction/initiation of e-commerce in any organizations (2) problems after
the introduction of e-commerce in any organization. Thus, two types of strategies are
needed for the success of e-commerce.
I
Strategies before the Introduction of E-Commerce
In the present study the researcher has made an attempt to suggest broadly two
types of e-commerce strategies. First is directed towards the strategies which one should
keep in mind before entering in the world of e-commerce and second is directed towards
the successful implementation of e-commerce technology after its introduction in any
organization. Some strategies, which one should keep in mind before entering in the
world of e-commerce, are given as under:
O9: To study the important aspects of e-commerce while entering in the world of
e-commerce.

1 Mukhopadhyay, Subrata (2002), “E-Commerce: Prospects, Problems and Policy", Vaanijya, Vol. 5, No.
2, pp 9-12.
2 Arora, Rajiv and Banwet (2003), “E-Commerce Implementation in India: A Study of Selected
Organizations", Asia-Pacific Development Journal, Vol. 10, No. 1, pp 69-95.
1 Sumanjeet (2003), ‘E-Commerce ’, M.Phil. Dissertation submitted to Department of Commerce, Maharshi
Dayanand University, Rohtak, Haryana.
4 Sumajeet (2004), "E-Business: Is India Ready for IT?", Journal of Commerce and Information
Technology, Vol. 4, No. 2, pp 89-95.
5 Arora, Rajiv (1995) "Electronic Data Interchange: Emerging Information Technology in the Area of
International Trade", Vision: MDI Management Journal, Vol. 8, January Issue.
6 Sawhney, Clifford and Kaul, Lakshmi (2001), "B2B- Redefining the Business Parameters", E-
Commerce, Vol. 1, No. 7, pp 7-12.
7 Pani, Ashish (2002), “A Roadmap for B2B Marketplace", Management and Labour Studies, Vol. 27, No.
3, pp 141-148.
8 Singh, Ranjit and Singh, Kawaljeet (2004), “Information Technology (IT) and IT-Enabled Services (ITEs)
as a Catalyst in Economic Development of India", Indian Journal of Applied Economics, Vol. 1, No. 1, pp
119-126.
9 Sengupta, Dipankar (2004), 1Exporting Through E-Commerce: How Indian Exporters Have Harnessed
the IT Revolution', CSH Occasional Paper, No. 8, pp 3-12.

203
 • The concept of electronic commence has just arrived in India; therefore there is
strong need to understand the concept of e-commerce in its real sense. To many
Indian firms e-commerce is just a technology. But in reality, e-commerce is lot
more than Internet, software and hardware or other technologies. In fact, it is all
about the way of conduction of any business with technologies. Remember that,
e-commerce is a true modern business strategy-the web or other technologies has
not changed the fundamental of business, but only expanded its scope. Therefore,
it is suggested, that any firm that wants to start business online must remember
that the e-commerce strategy is to use and expose existing systems and processes,
rather than build an isolated e-business system to do business online. Traditional
rules of commerce still apply and should be used within e-commerce, which
should be integrated with traditional business processes and must be seen as
technology helping to make the business more effective, efficient and easy to use.
• E-commerce can be more than technology, and if used as a strategic tool; it can
provide organizational benefits though gains in productivity, marketshare or even
bottom-line profitability. At the same time, if e-commerce is not suitable for a
company and yet it decides to maintain a presence, it can lead the firm to financial
ruin. Therefore before entering the e-commerce marketplace, a firm must
considered what business value it holds. To ascertain just how the e-commerce
technology fits, firms need to put in place sense making approaches that look
beyond the simplistic views and strategies of bubble years. They need to be able
to answer fundamental questions such as:
1. Does the Internet suit the nature of product and appeal?
2. Can the brand of firm attract customers to the website?
3. What are the savings in transaction cost?
4. What value added service and technologies can be used to encourage ‘lock
in’
5. What is required relationship between offline and online activities?
6. How to minimize the conflicts with traditional value chain partners?
7. How to establish the appropriate internal incentives for the online
businesses to flourish without damaging the existing business?
The crash of 2000 has provided welcome breathing space for established firms to
work out their answers to these and many other questions of e-commerce strategy. In
forming these strategies firms’ must focus more on traditional rules and theories of
business and pay less attention to traditional IT gurus and consultants.
• Slywotzky (2000)'° revealed that adoption of e-commerce is necessity for the
future business. In fact, it is a change and it will surely come. It is immaterial to
think that whether a firm likes it or not. It is necessary for the survival and growth
of business in the future. Therefore, the firm want to introduce e-commerce
should have a very positive attitude*11 regarding the benefits of e-commerce after
its introduction. The present study identified two major psychological barriers in
the planning/introduction of e-commerce. Such types of barrier should be

10 Slywotzky, J. Andrain (2000), "The Future of E-Commerce”, Harvard Business Review, January-
February, p 39.
11 Indian firms are not convinced with the benefits of e-commerce and it was difficult for the Indian firms
to change their mind for the change.

204
 removed. This can easily be done by understanding the financial and non financial
benefits of e-commerce; top management by convincing their employees about
the advantages of e-commerce at their work and by motivating lectures to adopt
new technology and above all by providing training12 to use these technologies.
Therefore, it is suggested for the firms to remove all the psychological barriers
before introducing e-commerce. This problem looks simple, but the consequences
are very real because unless you have faith you can not believe and unless you
believe, you can not work for that.
• Today, the question for the Indian business is no longer whether or not to do
e-commerce, but how to do e-commerce the right way. And what is the right way?
The answer is a solid business planning. A crystal clear planning is needed for the
success of e-commerce. Before introducing e-commerce, identify the need13 for
an online presence. Figure out the long-term goal14 and always keep that in mind.
After the goal fixation, a firm needs to decide what are the available options? A
company may decide: (1) not to go in for e-commerce, at least for the time of
being (2) to use the web just as a means of advertising15 (3) to open online web
stores complement existing stores (4) to establish a separate online division within
the company and (5) to dissolve their regular business and go for a full online
business operation. The choice depends not only on the nature of business, but
also on the environment it operates in, internal resources available and the
company’s position and initiatives. Thus, before introducing e-commerce, a firm
should identify which of the five options best suited to the overall company
vision. Thus, planning, clear thinking are important to the success of e-commerce
initiative.
• Once the aims and objectives for e-commerce are clear, the company needs to
carry out a feasibility study and analyze that is it possible for the organization to
offer online services with the available resources. It is suggested for the firms that
want to introduce e-commerce technology to examine the financial, human as
well as technological aspects, looking at the benefits of e-commerce and
analyzing the risks and pitfalls. Financial factors16 should be given due
consideration as introduction of e-commerce technology require huge funds.
Added to this, such high tech and innovative ideas are basically risky in nature

12 Training is the best way to realize the employees about the advantage so e-commerce.
Studies revealed that businesses that lose track of the business, reasons behind an e-commerce strategy
never have a fast or easy time going.
14 The goals behind an e-commerce strategy should include some or all of the following.
• Expand geographical reach
• Expand into new markets
• Increase revenue and market share
• Improve customer services and interaction
• Increase brand awareness and awareness of the company
• Reduced operating costs
• Compete with bigger rivals
• Be seen as innovative and progressive company though being an e-commerce leader.
15 This option is quite popular as it involves low costs, no costs of security, payment web hosting etc.
16 In the present study, financial burden was identified as a major barrier in the introduction of e-commerce
in any organsations.

205
 (Sumanjeet, 2005)17. Therefore, a firm should think very cautionally before
investing their funds in e-commerce. For this a company should carry out SWOT
analysis. By mapping out the weakness and opportunities, risks can be identified
and action planned to reduce the risks so that advantage can be taken of the
opportunities.
• Coordination and integration is the key. It is complex and involves virtually every
group with business from IT to marketing and sales to HR to accounting. To roll
out an e-commerce strategy that is effective from the start, all internal functions of
the business must be coordinated, both with respect to the process and timing.
Companies must also decide whether to create a separate unit for e-commerce or
try to infuse it into all company operations. Many companies are blending both
approaches in order to build speed and agility while maintaing corporate unity.
Thus, companies’ with a bricks-and-mortar presence wanting to offer e-commerce
must consider that it is not sufficient to have a world beating website18.
Organizations must ensure the whole business functions in an integrated manner
with the visible front end.
II
Strategies after Introduction of E-Commerce Technology
Ideas, plans and strategies are one thing-implementation is something entirely
different. In other words, a strategy is nothing without implementation. Implementation
of e-commerce strategy is neither straightforward nor cheap, for example it comprises a
complete rethinking of traditional modes of behavirour. There is need to involve internal
staff and external suppliers and customers rights from the conceptual stage, need to
re-valuate a company’s core competences and substantial investment in IT. Many of the
advantages of e-commerce will be lost if it is implemented in isolation. On the basis of
the problems identified by the present study, some suggestions towards the successful
implementation of e-commerce are given as under:
• Present study identified that most of the Indian firms are not generating value
from e-commerce investment that they could be. The companies that manage
their e-commerce investments most successfully generate returns than those of
their competitors. While a number of factors distinguish these top-performing
companies, most important is the senior managers take a leadership role in a
handful of e-commerce decisions. By, contrast when senior management
abdicates responsibility for those decisions to e-commerce implementation,

17 Sumanjeet (2005), "Venture Capital Financing in Indian perspective”, Journal of Social and Economic
Development, Vol. XVI, No. 2.pp 115-129.
18 A good website should include some or all of the following qualities:
• Website should give professional appearance. Expert web development, striking graphics and
logos, economic layout, planning colour schemes and professional web design add up to a
motivating shopping experience for the online customers.
• Electronic payment system should be safe, secure and reliable.
• Slow loading web pages will derive online shoppers away in droves. Optimum pages for fast loads
and choose state of the art hosting.
• Streamlined, intuitive navigation is essential. Solid design means clear business.
• From the mission statements to the product descriptions, compelling, clear professional written
copy is utmost important.

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 disaster often ensues. To help the senior managers avoid e-eommerce disaster-
and more important, to help them generate real value from their e-commerce
investments, the researcher offer a list of six decisions for which they would be
wise to take leadership responsibility. The first three have to do with
e-commerce strategy; and last three relate to the execution. Each is a decision
that IT people of people concerned with e-commerce should not making-
because in the end it is not their job. it is the job of senior managers. These are:
1. How much one should spend on e-commerce technology19
2. Decisions regarding which e-commerce initiatives will and will not be
funded20
3. How good do e-commerce services really need to be
4. What security and privacy risks will accept
5. What IT capabilities need to be company wide
6. Whom to blame, if e-commerce initiative fails
The present study reveals that, e-commerce firms in India are facing a talent
crunch, the problems of lack of skilled manpower and experienced
professionals, and high attrition. Best way to manage the knowledge workers
is to provide them lots of freedom and same time load them with challenges
and problems. Style of total transparency and knowledge transfer and social
focus can ensure the knowledge workers to dedicate them to the
organizational goals. Respect and provide the best to employees and
colleagues (tech knowledge and financial benefits), create value for
customers, create employment for the needy people and follow the rules and
be ethical. It will make the employees more productive and their jobs more
rewarding with immediate access to corporate customers and personal
information and improved work process. To make the existing employees
more loyal to the organization and to attract the skilled ■ymanpower,
•y
use the
concept of employees’ relationship management (ERM ). Further, follow

19 The best strategy as some companies follows is that first they determine the strategic role that
e-commerce will play in their organizations, as only then do they establish a company wide funding level
that will enable technology to fulfill these objectives.
20 A lack of focus overwhelms the IT unit, which tries to deliver many projects they may have little
company wide value or can not be implemented well simultaneously.
21 An overemphasis on security and privacy may inconveniencies customers, employees and suppliers; an
underemphasize may make data unlnerable.
22 Sharing and creating knowledge motivates employees to learn and think in terms of a learning
community. Collective learning fosters coping skills and builds change-resilience skills in a fast changing
new environment. ERM is a system and a collection of tools that:

• Strengthen corporate communication and culture

• Foster learning - about company products, services and customers in a single personalized and
easily accessible format through an enterprise portal.
• Help customer-facing employees become more competent to handle customer interactions
• Establish new communication channels - mail, shared folders, mail filters, web mail, calendar and
mailing lists.
• Newer communication methods like open talk forum management
• Enables efficient project management

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 socially motivated HR Policy to retain people and keep the attrition much
lower than the industry standards.
• Trust is the essential for the successful implementation of e-commerce. A key
reason for the people’s lack of willingness to provide information or shop
online is ‘the fundamental lack of trust/faith between most businesses and
customers on the web23’. Thus, trust is essential24 for ‘online relationship
exchanges’ involving personal and financial information, which take place in a
virtual environment characterized by uncertainty, lack of control and potential
opportunism. Hence, a key question for e-commerce success from a human-
computer interaction perspectives: How can e-commerce technology be
engineered to inspire consumer trust? There are some suggestions to build trust
among the companies and between companies and customers.
To build the trust, consumer satisfaction is utmost important. ‘Consumer’
concerns with payment security and information privacy are two key hurdles
identified by the present study25. To overcome these hurdles, website design
should help to create and establish a climate of the trust. With regard to website
content, the literature has highlighted guidelines that help foster consumer trust.
These are:
1. Provide identity of company (Integrity)
2. Disclose performance history (Competence)
3. Post a clear Security and Privacy Policy (Integrity)
4. Provide comprehensive and accurate information of product and
pricing (Integrity)

• Smooth workflow management - Forms creation, process management that links applications and
processes
Real time access to company training
• Targets information to employees based on their interests and needs - User personalization
• Reduces time spent in searching for information - unified search tools
• Streamlines performance management
• Manages resources creatively
• Encourages loyalty and commitment from employees
• Frees HR department to concentrate on more strategic tasks
• Raises productivity
• Encourages innovation levels
• Reduces turnover

Lack of trust is directly concerned with the problems of security and privacy. Not only present, but may
other past studies (Hoffman e al., 1999; Bhattacherjee. 2002 and Keen, 1997), revealed that directly or
indirectly lack of trust between businesses and customers is the most significant long term barriers for the
e-commerce.
24 This finding is also supported by the study of Hoffman. Novak and Peralta, 1990.
Hoffman, D.L.; Novak, T.P. and M. Peralta (1990), “Building Customers Trust Online", Communications
of the ACM, Vol. 42. No. 4, pp 80-85.
25 These two hurdles are also identified as major problems in the successful implementation by the study of
Cox, 1999; Ernst and Young, 2001 and Swaminathan, 1999.
Cox, B. (1999), “Security, Privacy Remains Top Consumer Concerns”, Inter/News.com accessed on
http://www.internews.com/ec-news/article.php/4_95031.
Ernst and Young (2001), “E-Security and Privacy: The Role of Web Seals on the Internet'', accessed on
http://www.ey.com/global,vault.nsf/international/e-Security&Privacylowerslocked.co,.Pdf.

208
 5. Disclose all aspects of customer relationship up-front (Integrity and
Benevolence)
6. Reliable and secure technology (Integrity)
7. Timely and professional website design (Integrity and Competence)
8. Use third party services (Integrity)
• Despite some renowned success stories, a lot of Indian firms and private clients
are still very reluctant to venture into e-commerce. The present study identified
the lack of apparent security as main barriers. It is important to mention that
some of these security doubts are justified, others are exaggerated. During the
survey, it was identified that for most of the Indian firms’ security means
technology, use of latest software and techniques. But, in reality security
begins with the employees. Many of the attacks taking place today feed on
employees and their lack of knowledge about security. Security should be a
critical part of employees’ education process. Employees should understand
different methods of intrusion, what security risks they may be presented with,
and how to eliminate the chance for intrusion. Existing security infrastructure
must be severely scrutinized in order to prevent the infiltration of viruses and
hacker intrusions into corporate networks. In addition, a well documented
security procedures plan should be developed.
• Keeping up pace with the changing technology is another most important
challenges identified by the present study. There is need for a continuous
upgrading of technology. It is necessary for the Indian firms to be aware of
changing technology and methods. Such information sourced on the web
should be addressed from specialist websites and portals, and should be specific
to individual sectors. Use e-mail and the web to contact with the specialist
organization. To keep pace with the changing technology, few companies,
especially large scales can afford to develop internally all the technologies that
might provide an advantage in the future. But, ideally, a mix strategy is needed.
Some technologies can be purchased from other companies; others can be
acquired from licenses, partnerships and alliances; and still other critical
technologies should be developed internally. Getting the right balance is again
very crucial for the success.
• With the large investments in e-commerce technology, and critical risks
involved, there is growing necessity for the senior executives and boards of the
directors to put e-commerce firmly on the boards’ agenda. Boards and
executive management need to explode governance to e-commerce technology.
E-commerce governance26 entails several activities for the board members and
executive management, such as being informed of the role and impact of IT on
enterprises assigning responsibilities, defining constraints within which to
operate, measuring performance, managing risks and obtaining assurance. At
its core, e-commerce is concerned about two responsibilities. First, e-commerce
technology must deliver the value to the business and second, e-commerce risk

26 The objectives of the e-commerce governance are to help board and management understand the issues
and strategic importance of e-commerce to ensure the enterprise can sustain its operations and to ascertain
if they can implement the strategies required to extend the enterprise in future.

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 should be mitigated. Both of these areas need measurement. The board must
direct management to deliver measurable value through:
1. Delivering on time and in budget
2. Enhancing reputation, product leadership and cost efficiency
3. Providing customer trust and competitive time-to-time market.
The board should also drive business alignment by:
1. Ascertaining that e-commerce strategy is aligned with business
strategy.
2. Ascertaining that e-commerce delivers against the strategy though clear
expectations and measurement.
3. Directing e-commerce strategy to balance investments between
systems that support the enterprise as is, transform the enterprise or
create an infrastructure that enables the business to grow and compete
in new arenas.
4. Making considered decisions about focus of e-commerce resources:
break into new markets, drive competitive strategies, increase overall
revenue generation, improved customer satisfaction, assure customer
retention.
• There is big difference between spending money on customers and products
making it all work27. As many businesses are shifting their marketing battle
from traditional commerce to electronic commerce, certain issues of creating
satisfied customers, retaining the customers and more importantly building the
loyal customers are emerging. Therefore, every business, B2B or B2C must
focus on the needs of its customers and practice effective customer
relationship management. The e-CRM is just what the e-commerce business
needs28. E-CRM is premised on the belief that developing the relationship
with the customers is the best way to get them to become loyal and loyal
customers are more profitable than the non-loyal customers. In fact, it is an
excellent concept if implemented successfully. It is a part of e-commerce
strategy and therefore requires the direction and engagement of the senior
management to be successful. Senior management must have a broad
understanding of the capabilities of these technologies and than translate them
into specific opportunities that leverage the competitive advantage. Further,
e-CRM can not be operated in an institutional vacuum, it requires
development of a set of integrated software applications with all aspects of
customer interaction i.e., e-mail management, interactive voice responses,
knowledge management, instant online querying through chat, call centers etc.
Indian e-commerce firms must carefully calculate and understand the benefits

27 Managing customer relationship effectively and efficiently boosts customer satisfaction and retention
rates (Richheld, 1996; Jackson, 1994 and Levin, 1993)
Reichheld, F.F. (1996), “ Learning from Customer Defections", Harvard Business Review, March-April, pp
56-59.
Jackson, D. (1994), "Relationship Selling: The Personalization of Relationship Marketing", Asia-Australia
Marketing Journal, August, pp 45-54.
Levine, J. (i 993), "Relationship Marketing”, Forbes, 20"' December, pp 232-234.
28 For details, please see, Sumanjeet (2005), “E-CRM: Building the Loyal Customers in the Age of
Electronic Commerce", Pakistan Management Review. Vol. XLII, No. 3, pp 45-54.

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 they will gain and must realize that CRM and e-CRM investments may not
show quantifiable benefits in the short term. A healthy balance of hard and
soft benefits is a sign of a well thought out justification for pursing e-CRM.
• In this rapidly changing competitive scenario, where companies are fighting
for a higher market share and margins, e-marketing is the frontline of any
corporate strategy. Smith and Chaffey (2001)29 found that internet technology
can be used to identifying, anticipating and satisfying the customers’ needs.
Therefore it is suggested to have a sound e-marketing strategy. There are
some suggestions one need to consider when market product or services
online. There are:
1. Study the online demand for the firm’s product and where that demand
lies. One can be pretty certain that specific demographic group can be
easily located on the internet using the expertise developed over years
of market research. In short, a firm should know their customers and
give them the product they want.
2. The most important e-marketing related issues are pricing. There are
different models of pricing goods on the Internet. An interesting model
of pricing for goods sold over Internet is through offers made by
customers30. As the price is extremely important for e-commerce, firms
engaged in e-commerce must also develop value based pricing
strategies, which call for increasing perceived value and then setting
the price at a level compatible with the value.
3. Besides registering catchy and memorable domain names consider
brand and visual image. Think about attractive logos, visual imagery,
web design formatting, packaging, and business cards anything that can
transmit a memorable message about your internet business presence.
4. Once the company gets the customers to website keeps bringing them
back with dynamic content, rotating product promotions, freebies and
contest etc., and one owns content-rich company newsletter.
5. For e-marketing mix, a firm can think of six ‘I’s framework that
summaries how IT can impact the marketing functions, and hence
provides a basis for identilying opportunities and predicting future
changes. These six ‘I’s shows the levers that are available for the
e-marketing manager to pull through the use of IT. It may be necessary
to pull all the levers in even situation. The six ‘I’s are: (1) Integration
(2) Interactivity (3) Individualization (4) Independence of Location (5)
Industry restructuring and (6) Intelligence.
• Creating the customers is the most important objective of the companies. In
fact, customers are the most valuable assets of any company. Therefore, it is

‘ Smith, P.R. and Chaffey, D. (2001), E-Marketing Excellence at the Heart of E-Business, Butterworth:
Oxford. Further, Smith and Chaffey also provide 5 Ss as a useful mnemonic for how the internet can be
applied by all organizations or for different e-marketing tactics. The 5 Ss are: Save (Save the Costs); Sell
(Grow Sale); Serve (Add Value); Speak (Get Closer to the Customers) and Sizzle (Extend the Brand
Online).
j0 www.priceline.com allows buyers to request their own price for airline tickets, hotel reservations, cars
and financing.

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 the responsibility of every company to protect their customers and make their
online transactions safe and secure31. There are some guidelines for the
e-commerce firms to make their online customer safest and happiest.
1. Clear and sufficient information should be provided so that
consumers can make an informed choice.
2. Advertising should be clearly identifiable. Business should respect
consumers’ choice not to receive e-mail they don’t want. Businesses
should take special care when targeting children and others who
may lack the capacity to understand the information as presented.
3. Payment system needs to be secure and easy to use.
4. Personal information of the customers should be protected.
5. There should be access to fair, timely and affordable method to
resolve transaction problems.
6. No spam
7. The confirmation process for a sale should give the consumer a
chance to see what hew/she has agreed to buy and to change his
mind if he/she wants before the purchase is completed.
8. Online disclosures should include complete and accurate
information about the business, about the goods or services for sale
and about how the transaction is made.

Ill
Suggestions for Online Customers
E-commerce poses some genuinely new challenges regarding consumer protection. It
enables consumers to purchase from a remote, and may be unknown location, which
is not under the human control during the course of transactions, opening up new
possibilities for errors, flaws and fraud. Consumers require a level of certainty, which
gives them confidence in the process used, bona fides of the apparent trader, and the
underlying security of their data and money. Indeed there is high risk in online
shopping and law alone cannot remove all the risks. Add to this, in developing
countries like India laws are not strong enough to tackle the problem of consumer
protection in the electronic commerce age. Thus, again principle of Caveat Emptor
applies on online shopping. So consumers can, and should alert to these risks. There
are some general guidelines for the consumers for a safe and satisfying online buying
experience:
1. Read the privacy statement of vendors, especially in the case where
consumers are not familiar with the vendor, verify the validity of information,
as well as reputation of the company. A privacy statement is the legal binding
document that describes the personal information and dissemination practices
of a web site.
2. Before revealing personal identifying information online, find out how it will
be used and by whom.

’ In the present study security and privacy factors are identified as major barriers in the successful
implementation of e-commerce. Indian customers were least satisfied about this factor.

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 3. Many e-commerce sites require a password for online buying. If consumer
have accounts at more than one site, make sure each password is different. For
maximum security do not use password such as, (1) consumer’s telephone
number (2) birth date and (3) any other easily identifiable attribute. Finally,
consumers should not share his/her password with any other. Change the
password frequently and memorize them.
4. Make a print out of all the web pages or e-mail directly related to purchase, so
that the consumer will have complete records on the event of any problem. It
would be advisable to print out copies of web pages that include product
identification and descriptions, return policies, completed transaction forms,
and confirmation notices. Be sure that the print outs include the date and time.
5. Understand all the terms of sale. If consumer is unsure or uncertain of any
details, call or e-mail the company and ask question. If the consumer is not
satisfied with the answer or response, shop elsewhere.
6. Consumer should give credit card details only over a secure connection.
Consumer can check this in three ways: first, the address will be given in https
rather than http. Second, a padlock symbol will appear at the bottom of the
browser window. Third, a message will pop up when consumer switch
between a secure and a insecure site, although this can be disabled. Never
send credit card details by e-mail. Pay attention to credit card billing cycles,
and follow up with creditors if bills do not arrive on time. This could be a sign
that someone has changed the address or other information from consumer file
to hide illegal changes from consumer.
7. When shopping online, check the lock or key icons on the screen to make sure
that the site is secure. A broken icon indicates that the site is not secure.
8. The order form that consumer submit should reliably secure.

IV
Recommendation for Policy Making
At the government front, there is also strong need to take some vibrant step.
The present study indicates that the role of Indian government is not very encouraging in
boosting e-commerce in India. However, government of India has taken number of
initiatives to boost e-eommerce in India. Among them most were successful, and in some
sense we have achieved significantly. But still the present status of e-commerce in India
is very poor. There are still number of areas and aspects of e-commerce, where the strong
concern of Indian government is needed. On the basis of present study, researcher is
recommending the following points to consider:
• The Indian government should develop a ‘National E-Commerce Policy’
without delay. Under this policy the government should help in creating
e-commerce driven opportunities in India by establishing a dedicated section
in the trade department to focus on opportunities presented by e-commerce;
create B2G portals allowing enterprises to tender online, thereby creating a
reason for Indian firms especially SMEs to become e-commerce enabled;
support the establishment of business oriented telecentres by means of
financial and technical assistance thereby fast tracking the rural connectivity

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 and link in with international initiatives such as that of the e-commerce
section of UNCTAD.
• To make e-commerce a reality in India, there is strong need to bridge the gap
of digital divide. The first step towards bridging the digital divide is to
understand the divide itself, what it is? where it it? How it is? and what are the
affects? The legislatures should formulate the Digital Divide Council of India
to ensure that citizens and business community have reasonable access to
technology. In addition, technology training is needed to develop the
knowledge and skills required to enhance the quality of life.
• Telecommunication infrastructure is the backbone of e-commerce. The
present study identified that India's telecommunication infrastructure is very
poor as compared to many developing and developed countries. Therefore it is
recommended that government of India should take some vibrant step in this
direction to boost e-commerce in India. In the Indian context following
strategies should be adopted to promote e-commerce infrastructure.
1. With a view to developing the ICT in the country; it is important that
the government plays an active role as ‘enabler’ of ICT
development. The government should focus on facilitating the entry
of smaller, underprivileged players into the marketplace and work on
public-private partnership for increasing investment in this sector.
2. The Indian telecommunications system continues to be governed by
the provisions of The Indian Telegraph Act (ITA) 1885 and the
Indian Wireless Act 1993. Substantial changes have been taken place
in the telecommunication sector since 1992. Therefore, ITA 1885
needs to be replaced with more forward looking policy/act. The new
policy framework should focus on creating an environment, which
enables continued attraction of the investment in the sector and
allows creation of communication infrastructure by leveraging on
technological development.
3. With a view to promoting indigenous telecom equipment
manufacturer for both domestic use and export, the government
should provide the necessary support and encouragement to the
sector, including suitable incentives to the service providers utilizing
indigenous equipment.
4. Human resources are considered more vital than physical resources.
Emphasis should be placed on the development of the human
resources for all fields related to the telecommunication and the
dispersal of this expertise to the related fields. Such expertise should
also be made available to the other countries.
5. Recognizing that telecommunications is a prime pre requisite for the
development of e-commerce, telecommunication related research
and development (R&D) activities should be encouraged.
Government should ensure that the industry invests adequately in
R&D for service provision as well as manufacturing.
• A facilitative legal framework is a sine qua non for the promotion and
development of technology like e-commerce. As e-commerce is gaining

214
 popularity in India; it is essential that all players know where they stand vis-a-vis
the law of land. The IT Act, 2000, has been addressed to a considerable extent the
legal questions involved in adoption the cyber mediums of communication,
contracts and commerce. But, still there are many important issues of e-commerce
in India, which are not covered by the IT Act, 2000. It is clear from the reading
various provisions of IT Act, 2000 that there is nothing in the Act to protect the
consumers from false and untrue advertisement or presentation of online
information to the consumer and redressal of consumer disputes arising out of
E-commerce transactions. The other important aspects of e-commerce in India are
certain financial issues such as customs and taxation in relation to the sale of
consumer goods. Added to these, many other important issues like electronic
payment systems, intellectual property rights, right and liabilities of domain name
holders, privacy, wap and mobile commerce are not covered by the Act. Such
issue needs to be resolved at the earliest to promote systematic growth of
e-commerce in India and for giving full effect to the provisions of the Act. For
this, there is strong need to amend the not only IT Act, but also other related laws
such as Intellectual property rights, Indian Panel Code etc. In short, keeping in
view the emergence, growth and growing ramification, this law will need constant
modification to be at par with the existing requirements of modem day post-
globalize world.
Last but not the least; government should create an e-commerce friendly
environment. In this direction first, there is need to promote a strategy to educate
people to become the knowledge worker and IT savvy citizens to take the advantages
of e-commerce. There is need to join the hands with international institution
(UNCTAD, World Bank and ITC) working in the direction to promote e-commerce.
Further, government of India should encourage content creation in the areas where
country like Indian has advantage such as traditional art, music software products.
Government should also create awareness about the benefits of e-commerce and
should also promote the Indian companies to join B2B at an international level.

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 Section III
Conclusion

The application of information technology in business has undergone a paradigm

shift since its evolution. Electronic Commerce (E-Commerce) is possibly the most
promising information technology application that enterprises have seen in the recent
years. The benefits of e-commerce have been recognized by the businesses throughout
the world. It has completely transformed how businesses join buyers and sellers, manage
supply chains and bring products and services to the marketplace without the hindrance
of time and distance. Further, it can reduce costs, increase sales and profits. Despite of
many challenges, e-commerce offers huge business opportunities, which are not
available through the brick-and-mortar. In fact, applications of e-commerce models have
become very important, not only for the growth of business, but also for the survival in
the liberalized, globalized and high-tech business environment. In short, e-commerce has
become an integral part of corporate strategy all over the world today and it will become
more critical in the days to come. India is one of the few countries where this trend
seems to be catching on.
In India, e-commerce is still in embryonic stage, while in the other parts of the
world it has already taken deep roots. It accounts for a very small proportion of business
even in those sectors where it is growing fastest. But, it is the rate of expansion; in many
areas it is growing exponentially. In India, most of the e-commerce transactions are
limited to the B2B and B2C models of e-commerce. Among the Indian companies B2B
is fast flourishing and registered rapid growth in India within few years. However, B2B
in the past few years was limited to the Indian buying sites of other countries, which
denotes the outflow of cash. As compared to B2B e-commerce, the share of B2C is very
small in India.
Today, e-commerce is becoming all pervasive and is having deep impact on the
Indian trading, services as well as manufacturing sector. But, perhaps nowhere else is the
impact of e-commerce in India felt as much as in the service sector. The e-commerce
technology has come up with many channels for service delivery, offered like never
before convenience to the customers. Therefore, Indian companies are also positioning
themselves as e-service companies. Online stock trading, which is most amenable to
e-enablement has registered very impressive growth in India. But, if we compare the
present situation of Indian e-commerce industry with other countries, the situation is far
below the level of satisfaction.
In short, e-commerce industry in India has not taken off as expected. Despite the
perceived benefits and optimism, e-commerce adoption was hindered by number of
constraints. Some of the most important challenges in the introduction and successful
implementation of e-commerce, as identified by the present study are: psychological
barriers; financial burden; lack of skilled manpower to handle e-commerce transactions
and technology and poor IT infrastructure. Added to these, certain technological, legal,
as well as economic constraints are impending the growth of e-commerce in India. The
study also revealed that ‘security and privacy concerns’ are not inhibitors for Indian
firms; but for the Indian customers. However, for Indian firms, this issue is always a
prime factor of internal strategic importance, followed by human resources and quality
of goods and services. Regarding the satisfaction of Indian online customers, study

216
revealed that Indian online customers are highly satisfied with ‘website design factor’
than the other factors like-‘website reliability and fulfillment’, ‘customer services’ and
website privacy and security factors’. Further on the strategic part, study identified that
‘CEO driven strategies’ are most used in Indian organizations, which is followed by
‘middle management’ and ‘customer driven strategies’.
In India, e-commerce represents tremendous challenges, but also great
opportunities for the growth and development. Though the sample firms felt that
e-commerce was beneficial to the business in general, they were uncertain as to how it
would benefit their actual business operations. The study identified the important
facilitators behind the adoption of e-commerce. Some of the most important are:
improved business process flow and save time; reduced sales costs; reduced marketing
and distribution costs; and pressure and insistence for electronic commerce mode by
competitors and foreign buyers. Further, study revealed that, in Indian firms,
e-commerce is more facilitated by ‘cost driven facilitators’ than the ‘technology’ and
‘organizational’. Study also suggest that small scale firms can enjoy the benefits through
e-commence technology by having an access to the international market;
disintermediation process; increase turnover and stay ahead of the competitors.
As far as future of e-commerce in India is concerned, it looks very bright;
however the observed ‘expected growth level’ of e-commerce in India is not very
attractive. But, still in a developing countries like India, where market size is very large,
transactional costs are high, customer services are poor, paper work is more, business
require huge investment, internet users are growing rapidly and where information and
knowledge based industries still needs to open, e-commerce has huge potential. The
study revealed that, following the past trend B2B and B2C model of e-commerce is
expected to offer huge business opportunities in the coming years. In B2B e-commerce,
highest opportunities are expected in the manufacturing sector, followed by services
sector. In B2C e-commerce highest opportunities are expected in the ‘airline/railway
ticket reservations’, followed by books and musical products. Further, the study revealed
that, e-commerce will prove to be beneficial for the business, customers, employees,
society and economy as a whole. Thus, the study revealed that e-commerce can offer
huge business opportunities for the Indian firms in the coming years. To capitalize these
opportunities offered by e-commerce in any organization requires sound strategy, which
may not be the same as the traditional business strategy and further its successful
implementation in any organization. Thus, if the Indian firms want to develop effective
strategies for competing in the new economy (digital economy), they must understand
the fundamental structure of the next generation of e-corporation built on the
interconnected web of the enterprise applications.
At the government front, Indian government has already taken number of
initiatives to boost e-commerce. But, there are many areas and issues where strong
concern of Indian government is needed. There is strong need to boost the IT
infrastructure and bridge the gap of digital divide. Further, there is an urgent need to
address the tedious issues relating to security of payment and information, e-taxation,
customers protection. Last but not the least; government of Indian should create an
e-commerce friendly environment. All the more, change will come only by awareness at
all levels.
In short, this is a substantive research effort. It should provide both qualitative
and quantitative insights for those embarking on or pursuing e-commerce in practices for
the years to come.
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