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... eating textbooks to college students over the Internet since students are quite comfortable using it. Varsity Books. com's sales are purely online; however, they also market their products with a strong peer referral program. Varsity Books. com recruited more than 2, 000 student leaders at over 500 colleges and universities nationwide to work as on-campus student marketing representatives.
Today, Varsity Books. com sells over 350, 000 titles of textbooks, study / reference guides, and best-selling fiction and non-fiction. According to Student Monitor (the only nationally syndicated market research study of the college student market), Varsity Books. com is the most-visited and most often-visited Web site for the college market (Wilner, 2000). Wal-Mart is another company that capitalized on WAN technology. Aquilano, Chase, & Jacobs explain Wal-Mart's history of Point of Sale (POS) systems.
Wal-Mart started in 1987 with their award winning Satellite Network. It maintained real-time sales and inventory information and supported data, voice, and video. They implemented electronic data interchange in 1990 that issued electronic purchase orders and received invoices to / from their vendors. In 1991, Wal-Mart installed Retail Link, which enabled vendors to see real-time POS data. Vendors could then make improved forecasts and manage inventories better. Retail Link also included e-mail and Microsoft Excel to facilitate other supply activities (1998).
Not surprisingly, Wal-Mart has been a very successful company. As these examples show, WANs are influencing the operations of a variety of companies. They impact service companies like the airlines and hotels, established companies like JCPenney, new companies like Varsity Books. com, and industry giants like Wal-Mart. Why is the impact of WANs on business so significant? One part of the answer to that question is "leverage." More specifically, "strategic leverage." Hunt and Vargo define "strategic leverage" as the use networks and information technology (IT) to increase the advantage from an organization's strengths, and to capture opportunities not available without the use of use networks and IT.
Integrating networks and IT can help ensure organizations successfully respond to customer requirements with quality products and services in a competitive business environment (1996). Another part of the answer to question is "advantage." Successful integration may yield a competitive advantage over the organization's primary competitors. Results can include the creation of new business opportunities, improved responsiveness, and minimized weaknesses. Look at what JCPenney has done in the previous example to gain a competitive advantage over those that have not capitalized on Internet sales.
WANs can help organizations attain a competitive advantage, but nowadays, use of WANs is almost mandatory just to stay in business. The cost savings associated with communication, marketing, transactions, and other business activities make the use of WANs a "must have" in order to ensure efficient financial management and competitive in their respective industries. Hunt and Vargo state, "A company in the travel industry cannot remain competitive without access to networks" (1996, p. 41). This can be applied to other industries too. Again, JCPenney's entry in the Internet market gained a competitive advantage over their competitors that didn't, but they also maintained their competitiveness with those that did. To gain an understanding of the incredible growth and impact WANs are having on the economy, the following statistics and forecasts are provided: - Americans online is expected to be 194 million (68 %) in 2005, from 122 million (44 %) in 2000 - U.
S. workers with Internet access at work is expected to be 85 % in 2005, from 63 % in 1999 - U. S. business-to-business e-commerce will rise to $ 6. 3 trillion in 2005, from $ 336 billion in 2000 - U. S.
consumer e-commerce is expected to rise to $ 269 billion in 2005, from $ 45 billion in 2000 - E-commerce this holiday season is expected to rise to $ 11. 6 billion, from $ 7 billion in 1999 - Online small businesses with e-commerce are expected to be 49 % in 2003, compared to 34 % in 2000 - E-commerce is expected to represent 4. 4 % of the U. S. gross domestic product by 2002 (Carr, 2000). As the statistics and forecasts show, WANs and associated applications will continue to grow and significantly impact our business and economic environments. To account for the expected growth and range of use, the Internet Corporation for Assigned Names and Numbers (ICANN) recently added seven new web address suffixes to the existing dot-com, dot-net, dot-org, dot-edu, dot-mil, and dot-gov. The new ones are dot-biz, dot-aero, dot-coop, dot-info, dot-name, dot-pro, and dot-museum (McDonald, 2000).
Businesses can not ignore these trends. Use of WANs and e-commerce via the Internet is becoming the industry standard for companies to become and remain competitive. This essay attempted to provide a brief description of the impact of wide area networks on business. A definition of a WAN was provided and various business applications were described.
Communication methods such as the telephone and email were addressed along with marketing and financial applications. Real world examples from the travel and retail industries were also discussed. We saw how WANs were utilized by an established company like JCPenney to maintain its competitiveness, and how a new company like Varsity Books. com gained a competitive advantage and a piece of the college textbook market. Finally, we looked at the underlying concepts behind the success of WANs.
Strategic leverage was explained and how it can result in gaining a competitive advantage and / or simply maintaining a company's competitiveness. The future of WANs is bright. A. J. Strickland III and Arthur A. Thompson, Jr.
provide a succinct description of the current trend. They state, "Internet entrepreneurs are currently leading a revolution to revamp the value chains for providing traditional mail services, providing all sorts of information to businesses and households, for conducting meetings via cameras and computers while the attendees sit at their desks in their offices, for providing long distance telephone services via the Internet, for shopping for goods and services, for trading stocks, and on and on. They are employing "virtual value chains" and exploiting the new economics of doing business in the market space of the World Wide Web and commercial on-line services" (1999). Their choice of words seems accurate. We are employing "virtual value chains", there are "new economics of doing business in the market space", and we are experiencing a "revolution." The statistics revealed earlier support this.
The bottom line here regarding the Internet and WANs is that usage is becoming more prevalent and diverse every day, so you better gone on board or you will be left behind! Bibliography: References Aquilano, Nicholas J. , Chase, Richard B. , & Jacobs, F. Robert. (1998). Production and Operations Management: Manufacturing and Services (Eighth Edition). Irwin/McGraw-Hill Blakey, Elizabeth. (2000). "Exclusive Interview: JCPenney. com. " E-Commerce Times.
November 19, 2000 < web stories / success -jcpenney. shtml > Blanchard, Kenneth H. , Hersey, Paul, & Johnson, Dewey E. (1996). Management of Organizational Behavior: Utilizing Human Resources (Seventh Edition). New Jersey: Prentice Hall. Carr, Laura. (2000). " 100 Numbers You Need to Know. " The Standard. com.
November 19, 2000 < web > Hunt, Ray, & Vargo, John. (1996). Telecommunications in Business: Strategy and Application. Irwin/McGraw-Hill McDonald, Tim. (2000). "New Internet Domain Names Approved. " NewsFactor Network... November 19, 2000 < web > Strickland, A.
J. III & Thompson, Arthur J. Jr. , (1999). Strategic Management: Concepts and Cases (11 th Edition).
Irwin/McGraw-Hill. Wilner, Joshua. (2000). " Small Business Success Story: Varsity Books. com. " E-Commerce Times. November 23, 2000 < web stories / success -varsitybooks. shtml
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