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How can e-commerce be applied to a traditional, noncommercial environment such as a university?

Authors:

Abstract

E-commerce is becoming increasingly important in all sectors of society. Yet, although educational institutions have been early adopters of information and telecommunications technology, few have taken on e-commerce as a secure way of doing business transactions. Most institutions see e-commerce only for business environments. Thus they miss noting that even nonbusiness entities can benefit from e-commerce, as they also produce goods and deal with buyers and suppliers. We investigate how e-commerce may be used in a traditional, noncommercial environment such as a university, and we investigate the benefits of adopting this technology. The use of e-commerce in universities is a logical extension to the broader issue of the use of IT in educational institutions. In this sense, it includes both "traditional" IT functions and goes beyond it.
HOW CAN E-COMMERCE BE APPLIED TO A TRADITIONAL, NON-COMMERCIAL ENVIRONMENT
SUCH AS
A
UNIVERSITY?
J-M. Bancilhon and Ian Kennedy
University
of the Witwatersrand, South Africa
Keywords
-
higher education, students, environment, technology, universities, activities, on-line, electronic commerce
Abstract
-
E-commerce is becoming increasingly important in all sectors of society. Yet, although educational
institutions have been early adopters of information and telecommunications technology, few have taken on e-
commerce as a secure way of doing business transactions. Most institutions see e-commerce only for business
environments. Thus they miss noting that even non-business entities can benefit from e-commerce, as they also
produce goods and deal with buyers and suppliers.
We investigate how e-commerce may be used in a traditional, non-commercial environment such as a university, and we
investigate the benefits of adopting this technology. The use of e-commerce in universities is a logical extension to
the broader issue of the use of IT in educational institutions. In this sense, it includes both "traditional" IT functions
and goes beyond it.
WHAT IS
OUR
DREAM?
We have a dream. A dream for an efficient,
affordable university.
Today,
E-commerce
is the buzzword in business. It is
often maintained that the very survival of companies
depends on their adoption
of
electronic commerce.
Porter says "the greatest threat to an established company
lies in either failing to deploy the Internet or failing to
deploy it strategically." This threat is due to the advances
in communications and information technology,
especially the Internet and deregulation, allowing
businesses to compete globally. The impact of e-
commerce is vital to various sectors of the economy. The
present study investigates the impact
of
e-commerce in
higher education, focussing specifically on the university.
The educational sector itself is in turmoil, and is now
competing globally within a "new economy" where
different business models
are
replacing traditional ones
or, as Porter puts it, an old economy that
is
empowered
by new technology.
E-learning
is but one of the
examples of the use of
e-commerce
in the university
environment.
Our
main focus centres on the use of e-
commerce as a supporting tool for the management and
administration of a university.
Generally, successful e-commerce ventures have been
from organizations that already existed as physical
entities and which each developed a parallel e-commerce
platform. Pure "dot-com" companies, without any
backend processes have often failed.
So
we embrace the
term
electronic
business
to highlight that electronic
commerce is firstly about business. Also, electronic
business is the
integration
of business principles and
communications
,
technology rather than just a
technological solution to the problems of business. Porter
says that we need to
"see
the Internet for what it is: an
enabling technology
-
a powerful set of tools that can
be used, wisely or unwisely, in almost any industry and
as part of almost any strategy." Our work investigates
how e-commerce can be used to enable the university to
perform its manifold activities in a more efficient and
economical way. We examine which of the university's
activities are amenable to the use of e-commerce and
which are best left as they stand.
WHAT IS KNOWN ABOUT E-COMMERCING
THE UNIVERSITY?
The use of technology in teaching was, and still is an
important topic. However, discussions have tended to
focus on the provision of on-line teaching material, and
not on the use of technology to run a university in a
business sense. The literature has tended to investigate
an
e-university. (This is an electronic or virtual university.)
However, the present investigation relates to a brick
&
mortar university that is to be "e-commerced". The
obvious parallel is with that of a dot-com that only has
virtual
existence. It can be compared to an electronic
university. Contrariwise, a brick and mortar business
which is also developing an e-commerce platform would
be equivalent to the existing Corinthian column
&
cement university which decides to use the technology to
perform and enhance some of its activities.
Literature shows little evidence that e-commerce is used
in the higher education sector. The
main
effort is in the
UK,
and is a special concern of the Joint Information
Systems Committee
(14).
In the
US,
the university of
Texas
(15)
has a presentation on "eBusiness for Student
Services and Beyond" where a student portal
is
developed
to
cater for the needs
of
students. The reasons
0
2002
The
Institution
of
Electrical Engineers
Printed and published
by
the IEE, Savoy Place, London
WC2R
OBL,
UK
341
for this lack of evidence of work may be partly due to a
lack
of
consensus on the term "e-commerce", as there
is
often confusion between the use of Internet technology
and e-commerce.
Regionally, it does not seem that any e-commerce
ventures are happening at South African universities,
whether in the academic
or
administrative functions of
the university. The focus at universities has tended to be
on the use of e-commerce technology for online learning
rather than
on
applying it to different departments and
activities.
In an e-commerce survey of
76
higher education
institutions, Aird found that only
6%
of the finance
departments of these institutions were involved in the
development of e-commerce in higher education
-
the
majority of initiatives
(60%)
came from Web
staff, followed by academic departments
(13%).
This is a
surprising result that needs further research to assess
whether the same is true in South African universities. A
possible reason for his findings could be the novelty of
Internet technologies, and that the main drivers are
coming from Information Technology (IT). This poses
certain problems. The development of an e-commerce
solution for a university driven mainly by IT, usually
views the problem
as
primarily a technological one. A
better approach is one that involves the integration of IT
and
sound business principles within the organization's
overall strategy. Otherwise the approach may result in a
"dot-ac or dot-edu failure", to coin a phrase.
Furthermore, the whole issue of the commercialisation of
the university is itself a controversial subject.
WHAT ARE THE PROBLEMS AND PRESSURES
IN HIGHER EDUCATION?
Increasingly, universities need to become competitive to
survive. As business entities, universities are now
competing in a global environment. The threats are
coming in from two sides: from distance learning
institutions and other universities.
Government policies
and declining subsidies are forcing universities
to
increasingly operate along business lines.
Eurich (in
Michael) says "perhaps even more formative than
economic aspects in influencing higher education
systems is the political structure and stance
of
the
government".
Traditional business processes such as marketing, are
now playing an increasingly important role in the running
of the university.
At the University of the Witwatersrand, the increased
student numbers in
2001
can be attributed to an
aggressive marketing campaign conducted in
2000.
For
example, all first year engineering students entering with
more than
30
points have their first year fees waived.
Furthermore, the diversification of offerings to our
students and the response of the University to changing
needs is important in attracting students. At the
University
of
the Witwatersrand, we now see innovative
degrees appearing, such as the BSc in Electrical
and
Information Engineering, the part-time BA for
business,
and an MA in biography, which has proved very popular,
especially amongst more mature students.
The educational environment has also changed: student
demographics are changing. More mature students who
are also holding jobs are going back to university
to
upgrade their skills. There
is
increasing emphasis
on
continuous and lifelong learning and professional
development.
So
the role that the university plays, and
the university itself needs to adapt and accommodate
these new students. It does this through the provision of
part-time classes, Web-based course instruction such as
WebCT or a mixture of different modes of teaching. The
changes do present challenges and opportunities to the
university, which is now forced to rethink itself and its
traditional role. The competitive environment is
ubiquitous: it is both international and local in various
forms. The competition is not just from other
universities, but also from educational institutions that
are managing to become accredited and
are
sometimes a
direct competitor to universities. The competition is
especially strong when they offer education that is timely
and directly relevant to the requirements of the
job
market. Many of these changes have been mainly due to
rapid advances in
IT
and the advent of the Internet. If a
reputable university offers an h4BA on-line, students
might very well prefer to enrol at this prestigious
university from the comfort of their home rather than
attending a residential local university.
HOW CAN E-COMMERCE BE APPLIED TO A
TRADITIONAL, NON-COMMERCIAL
ENVIRONMENT
SUCH
AS A UNIVERSITY?
Within the changing environment we have outlined
above, universities need to be competitive to survive.
One way of doing this is to streamline university
activities through the use of technology.
In line with the
principle of running a university along sound
business principles, it
is
hypothesized that the
university has a lot
to
learn
from
e-commerce.
Many
of the activities
of
the
university
are
similar
to
those of
businesses,
so
electronic commerce can
be
used to
streamline existing activities, add value through greater
efficiency
or
cost savings, and further support the
university's quest for innovation and competitiveness.
Greater efficiency will result from the automation of
existing processes as well as in the university's
communication with its students. In business, customer
relationship management occupies a central role, and the
benefits of this area need to be encouraged in the
university environment. Universities have often tended to
see students as a nuisance ("The enemy"!). Today's
thinking places the students first, recognizing that they
3412
are
the lifeblood of
the
continuing functioning and
financial viability of the university.
WHAT
ARE THE BENEFITS OF E-COMMERCE
TO THE
UNIVERSITY?
Here are some of the activities where e-commerce is of
benefit to the university:
The use of e-commerce in the library: Prescribed
material, for instance in the form of overnight
photocopies, can be allocated for students
registering for particular courses, and be down-
loadable in a format where they can view the
material online or print it. The costs savings here are
obvious: a single copy of the material can be
scanned instead
of
multiple copies which
are
bound
and which need to be checked for missing pages or
for vandalized material. The cost savings relate to
savings on labour required to produce the material;
shelving; unbinding and photocopying the material.
In addition there
are
issues of efficiency involved.
The material is always available and does not need
to
be reserved; it can be available from a remote
terminal anywhere in the world, provided it uses
secure e-commerce technology to ensure the
protection of copyright by ensuring that only
registered students have access to the material.
Conference registration and booking can take place
seamlessly using a platform that integrates
reservations, choice of accommodation and credit
card payments.
Educational courseware can be provided to remote
students or to students with disabilities. This
material can also be provided in a variety of formats
(for example, transcriptions in Braille or audio) from
a secure platform. Web-based learning is
immediately marketable to postgraduates. There is a
need for it for more mature students and for business
degrees such
as
the MBA where students go back to
get qualified after a few years of work experience.
There is also a market for certificate courses and
short courses provided by universities that are
directly relevant to the job market. Here, again,
business schools come to mind. Another instance is
practising lawyers who need to upgrade their
qualifications or do short courses
-
for example in
the area of Internet Law and international copyright.
With the worlds boundaries shrinking, it is not far
fetched to think that some South African lawyers
trained in Roman-Dutch law will also need to
know
about European Community legislation for instance.
Another benefit of electronic courseware is that it
allows students to learn at their
own
puce
and in
their
own
space.
This allows students to register at
any time during the year
-
something that has
already
started
happening
on
a small scale at the
University of the Witwatersrand.
4.
5.
6.
7.
8.
9.
Alumni shops can be put on-line, giving news of
alumni activities or for selling alumni goods.
Fund-raising can be effected.
The university can market its facilities and services
nationally, regionally or internationally.
The university can hire out the consulting time of its
leading academics.
University administrative activities can be
facilitated, This includes activities such as those
which involve its ordering equipment from its
suppliers etc.
Student records can be seamlessly integrated. There
would be
a
student portal that integrates the different
aspects of their student life
from
registration to
contact with their lecturers, on-line timetables, and
on-line exams, where applicable. Secure payment of
fees could occur. Bursary administration between
the bursary donors, the university and the students.
For example, the renewal of a bursary is often
dependent upon the student's passing each year, and
an integration of the various databases could ensure
direct payment to the student's academic and
residence account.
10. In the same way,
staff
benefits such as a staff profile
where medical aid payments, pension, salary
advances, leave and staff loans
are
all integrated and
can be applied for on-line in a secure way.
11. Taxation requirements and the revenue office of the
university may be integrated with related
applications.
12.
An
online bookstore can be built where students can
order and purchase prescribed and recommended
books, or the university and the book suppliers can
integrate.
13.
A recruitment platform can be erected, where the
university can advertise jobs and candidates can
submit their
CVs
securely.
14. People can subscribe to electronic journals that are
published by the university press.
15. Minutes of meetings can be circulated
only
amongst
the specific committees concerned, with due regard
being taken for the varied degrees of confidentiality
required.
16. Joint ventures can be provided and reciprocal
agreements between pairs of universities can be
implemented. For example, modules from other
universities can be linked. This can allow experts to
3413
be brought in to teach certain online modules in
specific fields, either integrated with the core
modules provided by the university, or as part of
interdisciplinary studies. Students can also take
enhancement courses and gain credits at other,
similar co-operating universities.
17.
An
electronic platform can be created for all
IT
related purchases. Transactions occur between the
computer centre of the university and outside
suppliers and the different university departments.
Other departments may
also
find that they need to
set up an electronic shop to deal with the university
community
-
for example in
the
provision of
stationery to the university.
18.
Online booking and payments of university events
and functions can be expedited. For example
bookings for the university theatre or concerts can
all be linked and seamlessly integrated with the
individual staff or student's record with the
applicable discount.
19.
Travel arrangements can be made on behalf of staff
members and be integrated to the staff portal.
20.
The buying offices and functions of the university
can be incorporated, One can even envisage an
electronic bidding platform for companies to tender
or for the university to get rid of excess assets
-
for
example when university vehicles
are
sold.
HOW
DOES
THE UNIVERSITY FUNCTION?
The university is characterized by a specific culture, and
the academic and administrative functions of the
university may
see
the problem very differently and the
traditional fear of commoditising the university can be a
real one with a fear that academic excellence is solely a
function of economics. As OBrien and Deans correctly
point out, the most fundamental difference between
industry and academe is one of values. (Wagner in
O'Brien
&
Deans) says "the business approach to
measuring output -value added- can only be applied
with difficulty to higher education. At its heart is the
treatment of the student, who is both input, output and
part-consumer.'' Michael points out that there are two
opposing philosophies governing higher education,
one
about consumerism, and one named as
"professiorialism". "Consumerism", he says, is an
ideology of the business world
-
an ideology that
defines the consumer as the "king". Under this
philosophy, the identification of a need, the
conceptualization of a product or a service in response of
the need, the design and marketing of the product or
service are dictated by information obtained from the
consumers. Indeed, the survival of a business
organization depends solely on the continuing
satisfaction of its consumers." Later, he talks about
"professiorialism"
as
"an ideology of the academic world
-
an ideology that defines the academic as the "king".
Under this philosophy, the faculty or professors
determine what to offer, how to offer, and when to offer.
The professors decide the kmd of services to provide and
what constitutes quality service."
WHAT ARE THE POTENTIAL PROBLEMS AND
PITFALLS?
This paper now envisages how far solutions that have
worked in a commercial environment
are
applicable in a
non-commercial environment such as a university. For
example, one of the reasons attributed to the slowness of
adoption of e-commerce in the commercial world is the
lack of trust and the security implications of trading
online with one's credit card. In a university
environment, on the other hand, this may not be
applicable.
As
Aird points out in his survey of
UK
higher
education, these institutions already have a high degree
of intemational credibility and that "no one suspects that
a British University is going to steal your identity or
defraud your credit card..
."!
The process needs a high level of investment in the
technological infrastructure. There are no guarantees in
these early days of educational technology and the use of
e-commerce
in
a university environment.
WHAT ARE THE RECOMMENDATIONS FOR
FURTHER RESEARCH?
The first author of this paper has the subject of this paper
for his MCom research. A draft questionnaire for the
study is in the Appendix. Issues for research are:
1.
Which separate endeavours, which could be
classified as e-commerce activities, already exist in
isolation at the University?
2.
How far is the University along the road to the
technological implementation of e-commerce? This
relates to security issues, digital certificates etc.
3.
How eager is the University to adopt
the
new
technology? Who are the main stockholders and how
do they feel about it? Who are the main drivers?
4.
How ready are the leaders and the staff for
E-
commerce?
5.
What are the ventures of other local and
intemational universities, and what can be learnt
from them?
6.
Contrariwise, which areas of the university cannot
benefit from
the
use of e-commerce?
7.
What has already been done around the world
(literature survey) and what can be learnt from those
places?
3414
8.
What import do different schools and departments
place on
the
e-commerce in a university
environment, and which specific activities will
benefit from this implementation? In which ways
will e-commerce enhance the existing university
activities? What
are
the possible negative
consequences of moving traditional processes to
an
electronic commerce solution?
9. How can the current business model for the
University be adapted and modified to incorporate
e-
commerce?
10. What would be the costs to implement e-commerce
at a university?
WHEN
HAS
THE
PROCESS
GONE
TOO
FAR?
It is important to realize that
our
aim is not to turn the
university into a shop, with its "products" as educational
consumables and its "customers" as its students. This
paper is not about the electronic version
of
a traditional
university but about the ways in which Communication
and Information Technology can enhance the existing
activities of the traditional university and help it to adapt
to a changing and competitive environment.
Our
theme is
to use what is best in those activities that can be
commoditised. Non-corporate universities do value
education as an invaluable good. In no way do we wish
to
reduce education to a commodity. The issue
of
the
commoditising of the university has caused a lot of
controversy. Fears include the fear of the university
losing its autonomy, the increasing power of IT in
academia, redundancy
of
academia and the fear
of
the
"classroom turning into a boardroom" (Noble, 1998) and
the issues surrounding the commoditising
of
education
(Moore, 2000; Taylor, 1998).
There are many
areas
where the university can benefit
from e-commerce and our aim has been to articulate
these areas clearly and explicitly.
REFERENCES
1.
2.
3.
4.
5.
6.
7.
8.
Aird, A.,.
2000,.
"E-commerce in Higher Education:
can we afford to do nothing?" [Online] Available
Fcrolrw:
http://www.ariadne.ac.uk/issue26/e-
commerce/
Joint Information Systems Committee,
[Online]
Available WWW: http:ll
www.iisc.ac.uk/curriss/general/strat
01 05/e com
Moore,
J.
W.,
2000,.
"Education: Commodity,
Come-on, or Commitment?"
Journal
of
Chemical
Education.
77
805.
[Online] Available WWW:
http:l/ichemed.chem.
wisc.edu/JoumaYIssues/2OOO/J
ulJabs805.html
Noble,
D,
F.,
1998,. "Digital diploma mills: the
automation
of
higher education."
First Monday.
[Online] Available WW:
htt~:l/www.firstmonda~.dWissues/issue3
l/noble/
O'Brien,
E,
M., Deans,
K,
R.,
1996,. "Educational
supply chain: a tool for strategic planning in tertiary
education?"
Marketing Intelligence
&
Planning.
14,
2,33-40
Porter, M.,
2001, "Strategy and the Internet",
Haward Business Review.
March issue, 63-78
Taylor,
K.
S.,
1998, First Monday. "Higher
education: From craft-production to capitalist
enterprise"
?
First Monday.
[Online] Available
m:
htt~:l/www.firstmonday.dk/issues/issue3
9/tavlor/
University
of
Texas,
2001, "eBusiness for Student
Services and Beyond", [Online] Available
WWW:
http://www.utexas.edule-Universitvipresentl
3415
APPENDIX A: QUESTIONNAIRE
.
Was your experience positive or negative and why?
What do you understand by e-commerce?
What do you understand by e-commerce technology?
Do
you think that the university can benefit from the
use of e-commerce? Why, how and in which areas?
.
Is
your department involved in any e-commerce
activity? Which ones
are
they?
Which functions or areas of your department do you
think could be e-commerced?
What, in your opinion,
are
the main obstacles to the
implementation of e-commerce technology in a
university environment?
Do
you trust
the
security
issues (such as credit card
payment) using e-commerce?
.
.
.
.
.
.
0.
Do
you think that security concerns are greater,
smaller, or the same in the use of e-commerce in a
university environment versus its use in a commercial
environment? Why?
1.
Do
you think that the use
of
e-commerce in
a
university environment will create job redundancy or
an increase in
the
number of jobs? Why?
2.
Do
you think that
a
university
should
be
run
as
a
profitable business? Why?
3.
What, if any, do you think are the implications of the
commercialisation of a university in relation
to
academic freedom and to issues such as excellence in
14.
'In your opinion, which department
or
departments
should be involved in the implementation
of
e-
commerce
at
the
university?
Why?
15.
What
do
you think would be the advantages
of
using
e-commerce in a university environment?
CONTACT
DETAILS:
1.
Jean-Marie Bancilhon, Manager:
Internet Services, Computer
&
Network Services,
University
of
the Witwatersrand, Private Bag
3,
P
0
Wits,
2050
Johannesburg. South Africa
Internet Services
Phone: International:
+27 (1 1) 717-1634
Send E-mail to
jean-marie@cns.wits.ac.za
2.
School
of
Electrical Electrical and Information
Engineering, University of the Witwatersrand, Private
Bag
3,
P
0
Wits,
2050
Johannesburg. South Africa
Ian
G.
Kennedy, Senior Researcher
Phone: International
+27 (1 1) 7 17-7228
Send E-mail to
z.kennedy@ee.wifs.ac.zu
3416
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Article
Many of the pioneers of Internet business, both dot-corns and established companies, have competed in ways that violate nearly every precept of good strategy. Rather than focus on profits, they have chased customers indiscriminately through discounting, channel incentives, and advertising. Rather than concentrate on delivering value that earns an attractive price from customers, they have pursued indirect revenues such as advertising and click-through fees. Rather than make trade-offs, they have rushed to offer every conceivable product or service. It did not have to be this way - and it does not have to be in the future. When it comes to reinforcing a distinctive strategy, Michael Porter argues, the Internet provides a better technological platform than previous generations of IT. Gaining competitive advantage does not require a radically new approach to business; it requires building on the proven principles of effective strategy. Porter argues that, contrary to recent thought, the Internet is not disruptive to most existing industries and established companies. It rarely nullifies important sources of competitive advantage in an industry; it off en makes them even more valuable. And as all companies embrace Internet technology, the Internet itself will be neutralized as a source of advantage. Robust competitive advantages will arise instead from traditional strengths such as unique products, proprietary content, and distinctive physical activities. Internet technology may be able to fortify those advantages, but it is unlikely to supplant them. Porter debunks such Internet myths as first-mover advantage, the power of virtual companies, and the multiplying rewards of network effects.. He disentangles the distorted signals from the marketplace, explains why the Internet complements rather than cannibalizes existing ways of doing business, and outlines strategic imperatives for dot-coms and traditional companies.
First MondayHigher education: From craft-production to capitalist enterprise" ? First Monday. [Online] Available m: htt~:l/www.firstmonday.dk/issues
  • K S Taylor
Taylor, K. S., 1998, First Monday. "Higher education: From craft-production to capitalist enterprise" ? First Monday. [Online] Available m: htt~:l/www.firstmonday.dk/issues/issue3 9/tavlor/ University of Texas, 2001, "eBusiness for Student Services and Beyond", [Online] Available WWW: http://www.utexas.edule-Universitvipresentl
do you think are the implications of the commercialisation of a university in relation to academic freedom and to issues such as excellence in 14In your opinion, which department or departments should be involved in the implementation of ecommerce at the university? Why?
  • What
What, if any, do you think are the implications of the commercialisation of a university in relation to academic freedom and to issues such as excellence in 14. 'In your opinion, which department or departments should be involved in the implementation of ecommerce at the university? Why?
South Africa Internet Services Phone: International: +27 (1 1)
  • Johannesburg
Wits, 2050 Johannesburg. South Africa Internet Services Phone: International: +27 (1 1) 717-1634