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E-Commerce and Executive Information Systems 111
The Internet is used to support interorganizational decision-making and provides
access to information outside the organization. Intraorganizational networked
decision support is achieved by the use of an intranet that allows people within an
organization to work with Internet tools and procedures. Many software and
hardware computing tools can be used to provide networked decision support.
These software tools are often known as groupware.
Networked computing allows organizations to conduct business electronically
among business partners. E-commerce is the execution of business via computer
networks. E-commerce means more than just another way to reach the market
since it also gives businesses the ability to share and manage knowledge, the most
valuable business commodity (Emery, 2001).
The Internet, intranets and extranets provide many benefits. The Internet’s
global connectivity, ease of use, low cost and multimedia capabilities can be used
to create interactive applications, products and services (Laudon & Laudon,
2000).
There is a popular misconception that e-commerce is merely having a Web
site. However, this is not the case. There are many e-commerce applications (e.g.,
banking, shopping in online stores, malls, finding a job, conducting an auction,
collaborating electronically on research and development projects) and in order to
execute these applications, it is necessary to have supporting information, organizational
infrastructure and systems. Applications of e-commerce may be divided
into three categories: (1) buying and selling goods and services. These are
commonly referred to as electronic markets; (2) facilitating inter- and
intraorganizational flow of information, communication and collaboration. These
are sometimes referred to as interorganizational systems (IOS); and (3) providing
customer service. Attention is now focused on IOS.
An IOS involves information flow between two or more organizations (Turban
et al., 2000). Its major objective is efficient transaction processing (e.g., transmitting
orders, invoices and payments) using electronic data interchange (EDI) or extranets
(Senn, 1996). An IOS is a unified system encompassing several business partners.
A typical IOS will include an organization and its suppliers and/or customers. The
most prominent types of IOS are:
• Electronic data interchange (EDI), which provides a secured B2B connection
over value-added networks (VANs). Before the introduction of the Internet,
e-commerce took the form of EDI over private networks (Mougayar, 1998);
• Extranets which provide secured B2B connection over the Internet;
• Electronic funds transfer (EFT);
• Integrated messaging - delivery of e-mail and fax documents through a single
electronic transmission system that can combine EDI, electronic mail and
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