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E-commerce and flexibility

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  1. Preliminary Features
  2. The human toll
  3. Political risk
  4. The real economy: Economics and Debt
  5. Economic Policy
  6. The external accounts and debt

The late 90s brought about a turning point in the e-commerce sector. According to the Benchmark group, the number of commercial sites on the internet increased from 200 in 1997 to 120,000 in 1999. How can the passion behind this explosive growth be explained? The answer is quite simple. The flexibility offered by e-commerce forms the heart of information systems and this is what has led to this growth.

To understand the growth of e-commerce and its flexibility, we will have to first understand the rigidity of Taylorism, which was being used extensively by enterprises. Taylorism is a management theory, whose main objective is to improve economic efficiency. Taylorism had flourished in a few nations, during the First World War, when the US had supplied weapons to its allies. This concept, in combination with Fordism and had lasted in these countries for thirty glorious years. But, the changing economic structure rendered this system ineffective as the Taylorist model was too rigid.

The appearance of a differentiated marketing system had highlighted the failures of the industrial system, which until then, had been based only on a production apparatus. This industrial system was also not aligned with the demands of the customers. Since the 70s, it has become mandatory for companies to adapt to the changing economic environment and changing demands by being flexible. The evolution of markets, competition, globalization, changing consumer behavior, changing consumption pattern, new technologies and the life cycle of a product are a few uncertain factors, which have made it mandatory for a business to adapt, and be flexible, in order to survive in the market. Flexibility of an enterprise can be defined as its ability to adapt to unanticipated changes in the environment.

E-commerce is a classic example of this phenomenon. After the internet was made accessible to the public, it has become an electronic distribution channel, where businesses and consumers interact to sell or buy goods and services. The internet was initially designed for military use and the universities, and was not meant for online trading. This transformation into an online trading system has happened very fast, and the internet has now become a must-shop space.

A process is a set of activities or operations held in sequence or in the network, which are implemented resources, methods and equipment to create value (process of production, distribution etc) to have a flexible means, being able to adapt to the variety of products or services and to fluctuations in demand. There was talk of "heavy" productivity for companies that produces standardized scale. Today, companies must adapt and be able to offer a wide range of diversified products. A process is more flexible as it is less specialized. In fact, this specialization is less clearly a source of adaptation to the variety of products.

In this case, the own e-commerce is a wide variety of products and will be able to offer all and sell them to users. Large-scale production, provides a large quantity of various products while maintaining a quality responsiveness and are major challenges of electronic commerce.

Tags: E-commerce; Flexibility; flexibility of an enterprise; Taylorism-theories of management;

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