integrated marketing strategies

Differences Between Business Oriented and Social Oriented Networks

Introduction

This paper will discuss the difference between business-oriented networks and enterprise social networks. What makes up a social-networking site and what makes up a business-oriented social networking site and why are they different?

Another topic concerns why do organizations need a business continuity plan? Why is it important to determine what business will do if a disaster, man-made or natural, strikes? Three issues that a business continuity plan should cover concern identifying assets, controlling the flow if information, and determining who is in charge, what is the line of succession?

Many companies have created profitable businesses from selling small amounts of products previously sold in bigger chunks. Music and books are two such products. The market started asking to buy single songs and not the whole album; so how do you serve that market and still make a profit? Micropayment systems seemed to have come up with an answer, and it serves more than just the entertainment industry. This paper will discuss how this system works and how it is expanding beyond music and books.

How business-oriented networks and enterprise social networks differ

A social network is defined as a place where people can create a personalized homepage writing about events in their lives, post pictures of the family, short video’s, music, post and exchange thoughts and ideas, and link to their friend’s websites; in essence, they create their space on the internet. They can even tag, or create hashtags (#thisisme) for their content, add keywords, so the content is searchable. Others can comment, like, or share your content should you allow them to do so (Turban, 2012).

Mobile devices play a big role in social networking; enter mobile social networking. Users can let their social network know that they’re checking in at a local restaurant for dinner, or they’re at a favorite watering hole watching a live band. They can even post pictures as well as live videos of the event. Many entertainers encourage people attending these events to share their experience as it is free advertising and helps to increase sales of their products such as music or films. Data has shown that mobile social networking has increased subscribers by substantial amounts; the number of mobile subscribers accessing Facebook increased over 100% in one year from2009 to 2010 (Stackpole, 2012). Two basic types of mobile social networks exist; companies are partnering up with wireless carriers such as Yahoo and MySpace via AT&Ts wireless network, and companies that do not have such relationships with cell companies; they use other means in which to attract users such as mobile apps. Examples of these include Classmates.com and Couchsurfing.com.

Business Oriented sites, also known as professional social networks, primary objective are to foster business relationships amongst its members and subscribers. Examples of these sites include LinkedIn, ViaDeo, and Zing.

Many businesses are increasingly using these sites to increase their business contacts, especially in a global economy. Social networks make it easier to maintain contact with colleagues around the world. Companies can advertise businesses services and products. They can show expertise in their field using multiple media including educational presentations, articles, videos; all at virtually no cost to host. This low cost is especially beneficial to small companies. The small business can contact potential customers on the other side of the world. This type of connection was impossible ten years ago. This type of cross-border networking makes globalization available for the individual and the small business (Turban, 2012).

The need for a business continuity plan

The number one reason for a company to have a formalized disaster plan in place is to ensure ongoing business activities that provide business continuity with the least amount of disruption and costs for the business. Many businesses have failed due to a lack of disaster recovery planning because they could not guarantee business continuity that would allow them to survive an unexpected disaster (Turban, 2012).

Part of a company’s security efforts involve preparing for man-made or natural disasters since these may occur without any warning at any time. It is best to prepare an actual plan that will work effectively in the face of calamity. The most important part of this plan is the business continuity plan. It addresses the question of how the business is going to operate should an unexpected disaster occur. Most likely a disaster will be localized; if it’s a worldwide disaster, a plan would be unnecessary.

A disaster recovery plan confronts two issues: one how does the business recover from a disaster; two, how does it continue to operate should a disaster affect the business. This continuity is especially true for global businesses since, as stated earlier, a disaster is usually a localized event, and the business will want to ensure the rest of the business continues as those operations will help to pay for the cost of recovery. It is imperative for a business to have a disaster recovery plan in place to obtain insurance that covers the cost of recovery from the disaster. Disaster recovery describes the events linking the business continuity plan to safeguarding and ensuring recovery.

The purpose of a business continuity plan is to keep the business running after a disaster occurs. All functions and departments need to have in place an effective recovery plan. Part of that plan includes asset protection and recovery, even replacement. The plan needs to detail who makes the decisions, even to the point of secession. The plan needs to concentrate on total recovery from a total loss. The plan needs to be kept current due to changes in technologies, circumstances, even personnel. Critical applications need identifying. And the plan needs to be kept in a safe and accessible place.

A disaster recovery plan needs to cover many areas sufficiently to ensure recovery. It includes identification of assets and their value; including people, buildings, hardware, software, data, and supplies. A threat assessment needs to be conducted to include man-made and natural threats from inside or outside the business. Conduct a vulnerability assessment, and calculate the probability for exploitation, and evaluate all policies and procedures.

Micropayment Systems

The music and book industries today allow consumers set up accounts allowing them to buy single songs, even individual chapters in a book at very low prices. Accumulation of single-item purchases occurs until the amount makes it cost-effective to submit the payment to the credit card company. These systems are known as closed-loop systems. The credit card companies are not enamored with these systems because it has caused them to lower their fees to capture what is becoming a huge industry. Much of this type of business was unimaginable 15 years ago. Today, transactions worth billions of dollars are being handled daily (Schonfeld, 2009))

The shopkeeper gathers all the purchases subscribers make until they are sufficient enough to submit to the credit card company to be cost effective. It’s much like gathering all the days sales at a cash only business and depositing the money in the bank at the end of the day. The problem is the shopkeeper risks waiting a long time on some low volume customers. By aggregating these purchases together, the shopkeepers lower their costs per transaction to the credit card company enabling to operate profitably.

Other industries that are successfully taking advantage of micropayments include mobile banking and microfinancing to poor, underdeveloped areas of Africa; M-Pesa has been successfully operating in Kenya and Tanzania, and has spread to India and Afghanistan as well. Cell phone technology has allowed people in remote areas to apply for and receives loans as small as $100.00 allowing them to finance business operations and providing electricity to their homes using solar powered generators (Mutiga, 2014).

Conclusion

The difference between business-oriented networks and enterprise social networks occur in the area of concentration addressed by the individual sites and how they meet their subscriber needs. FaceBook addresses the need for their subscribers to interact on a social basis, sharing thoughts, family news and photos, opinions are important to this group. LinkedIn allows for sharing contact information, providing specifications on products, showing expertise, getting a job. Mobile devices have played a big role in both businesses oriented as well as the social networking sites so that people can share and talk with each other at anytime from anywhere.

The need for a disaster recovery plan must include a business continuity plan. With a business continuity plan, the business will find it difficult, if not impossible, to find the resources needed to recover from a man-made or natural disaster. Business continuity ensures that the business has continual incoming resources adequately funding the recovery.

Micropayment of become successful because it addressed a need and demand in the marketplace for services otherwise unavailable without it. The market was demanding the ability to be supplied with goods and services on a smaller scale rather than previously available; especially with entertainment and finance products. Entrepreneur’s stepped up and began to determine that if they aggregated their sales receipts and submitted them in bundles rather than individually, they could cut their costs while also serving their customers. The rest of the market, mostly the credit card industry, had to change to meet the demand.

References:

Mutiga, M. (2014, January 20). Kenyaâ’s Banking Revolution Lights a Fire – The New

York Times. Retrieved from http://www.nytimes.com/2014/01/21/opinion/kenyas-

banking-revolution-lights-a-fire.html?_r=0

Schonfeld, E. (2009, March 25). Spare Change On Track To Process $30 Million In

Micropayments On Social Apps This Year | TechCrunch. Retrieved from

http://techcrunch.com/

Stackpole, B. (2012, August). Business case for enterprise social networks: Better

collaboration. Retrieved from http://searchcontentmanagement.techtarget.com

Turban, E. (2012). Electronic commerce 2012: A managerial and social

networks perspective. Upper Saddle River, NJ: Pearson Prentice Hall.

eCommerce Security & Payments Systems

It’s funny how the supposed secure RFID chips on credit cards are less secure than the magnetic stripe cards are. According to Chase Bank and American Express, the chips are built with 128-bit encryption and Triple-DES (Data Encryption Standard) protecting the data on the chip. Furthermore, the chips, theoretically, send a unique, single-use code with each transaction that does not match the number on the card (Johnson, 2009). And now wallets are available at Amazon that contains shields within your wallet preventing the reading of the card chips by portable readers of RFID chips.

Part of the problem with fighting computer criminals is that once companies have developed the means to fight the latest virus or DoS attack, computer criminals have developed another way to attack. Anti-virus software is only as good as the last known virus. A computer virus, phishing scams, Trojan horses, and DoS (Denial of Service) is used to get information, prevent the use of your computer, gather the information that can be used illegally or sold for illegal use. The biggest threat to computer security has been found to be the user. In the early days, users would write their passwords on a sticky note and post it on their monitors. You may laugh at this notion, but it’s very true. The problem with fighting computer crime is the inability of many people to understand that they’re being spammed or phished. They download a file containing a Trojan horse virus thinking it’s from their best friend, or they’re gullible enough into believing that their child, who is standing next to them, is badly injured in a Nigerian hospital and needs emergency help. The file they download carries a code that will allow their computer to be used in a vast network of other computers to infect many more computers. These computers provide enough power to cause heavy-duty denial-of-service attacks on many well-known companies or government services (Brumfield, 2015)

Grameen Koota set up micro-finance and is part of Grameen Bank in Bangalore, India. It provides small loans to poor or low-income clients. One of the problems that Grameen Koota was trying to bridge by developing a mobile loan and payment system was the inability of the poor to grow their way out of poverty. They didn’t have access to the means of capital they needed to provide even for necessities of life. Grameen Koota had a desire to grow their business. Since business and government were unwilling to set up the needed infrastructure due to the heavy costs of that infrastructure, and the people had a need, and the people owned the means; an abundance of cell phones, the opportunity to provide easy banking and financial services presented itself (Turban, 2012).

M-Pesa has been providing mobile banking and micro-financing to poor, underdeveloped areas of Africa; Kenya, and Tanzania since 2009, and that has since spread to India and Afghanistan. Many people with just a simple flip phone can apply for and receive loans as small as $100.00 to finance providing electricity to their homes using solar-powered generators. And the system allows the borrower to pay the bank using the phone. Grameen Koota had a problem with providing loans when it came time to collect payment; his collectors became victims of armed robberies while returning to the bank with the day’s receipts. One can only imagine the immensity of such a change to a rural area that has never had electricity. And the ability to be able to communicate directly with buyers anywhere in the world, versus just in their local area, allowing these people to sell their products allows them to work their way out of poverty and live a better life (Mutiga, 2014).

References:

Brumfield, J. (2015, April 13). Verizon 2015 Data Breach Investigations Report – About Verizon

Enterprise Solutions. Retrieved from http://news.verizonenterprise.com/2015/04/2015-data-

breach-report-info

Johnson, J. (2009, September 30). RFID Credit Cards and Theft: Tech Clinic. Retrieved from

http://www.popularmechanics.com/technology/security/how-to/a1142/4206464/

Mutiga, M. (2014, January 20). Kenyaâ’s Banking Revolution Lights a Fire – The New York Times.

Turban, E. (2012). Electronic commerce 2012: A managerial and social networks perspective. Upper

Saddle River, NJ: Pearson Prentice Hall.

Starbucks. Netflix and Social Media Marketing

Introduction

Today’s post will explore the success of Starbucks and Netflix on the Internet, particularly with Social Media. It will explore why Starbucks puts so much emphasis on social media like Facebook and Twitter and how these sites compare to their homegrown site. The question for Netflix is whether or not the Cinematch search tool is responsible for NetFlix’s success as a business or is it due to them moving to total streaming of movies and TV shows that created their success?

Starbucks

Starbucks, according to some people, makes great coffee. Their staffs of baristas are friendly, and their stores located just about everywhere in America. They even have stores in China. They’re known for their killer social media strategy (Huff, 2014).

Here are some of the stats:

● 36 million Facebook likes

● 12 million Twitter followers

● 93K YouTube subscribers

Those numbers are very impressive. There’s no doubt Starbucks is big on social media, but, why do they do it? Starbucks focus is on its customer base. Their customers are young, social media savvy, and affluent. They’re into the latest thing. On Facebook, the Starbucks management doesn’t post too often; they let their fans do all the talking. But when management does post, it’s usually fun things like contests, tips on things, as well as low-key sales pitches. Starbucks also allows customers to reload their Starbucks mobile card from Facebook. It’s all about creating relationships with existing customers to increase sales and add new customers. Free advertising from existing customer from their feedback adds on new customers at virtually no cost.

On Twitter, Starbucks connects with followers who want to catch up on the latest news and updates and the staff uses Twitter as a service reaching out to customers who are talking about their experiences with the stores and products. The staff checks out Twitter all day long to help keep satisfied customers satisfied and to settle any problems quickly before they get out of hand.

The similarities between Starbucks homegrown site, http://mystarbucksidea.force.com/, And Facebook or Twitter is that while getting customers is good, keeping them is even better. With over 23,000 stores, the company has reached a point where advertising on TV or radio has only so much impact. It no practices f-Commerce where developing social relationships online becomes critically important to keep customers (Turban, 2012). There are similarities on each of the social media sites that Starbucks has a presence, such as encouraging ideas for new drinks are food, attending social events at a nearby store. But each of these sites serves a different clientele. Facebook, for instance, is more family oriented than Twitter, which is more individualistic. All have a love for coffee which is the commonality of this community. Starbucks needs to use these other social media outlets so that it captures every possible customer. And the relationship needs to be tailored to fit the audience, a time-honored tradition in sales. The message can be the same, only stated differently for each audience (McNamara & Moore-Mangin, 2015).

Netflix

Was the reason for Netflix’s success due to implementing the Cinematch search engine on its system? Yes, it was a major contribution because of its ability to conduct extensive data mining; this software agent uses data mining apps to sort through a database of more than 3 billion films and customers’ rental history. Cinematch suggests different movies to rent to the customer. It’s a personalization similar to that offered by amazon.com when it suggests different book titles customers. The basis of the recommendation is a comparison of the individual’s likes and preferences, comparing them to people with similar tastes. With this type of suggestive system, Netflix tells subscribers which movies they probably would like and shows a comparison of what other similar people are watching.

Netflix has already successfully moved from just DVD rentals to streaming video. They have, in fact, been offering television series shows that has drawn in an even larger audience that has helped to increase their revenues beyond what just renting movies could do (Cohen, 2013).

Conclusion

Both Starbucks and Netflix have successfully moved into the Web 2.0 world using social media and search tools effectively to meet their customer’s needs and demands. Netflix moved successfully from being a DVD movie rental business doing mail-order only business, to becoming the preeminent streaming entertainment company with millions of subscribers. Both companies managed to take current technology and develop systems that meet the customer’s needs and making themselves very profitable with bright futures.

References:

Cohen, P. (2013, April 23). Forbes Welcome. Retrieved from http://www.forbes.com/sites/petercohan

/2013/04/23/how-netflix-reinvented-itself/#61f9c77d74ea

Huff, T. (2014, August 23). How Starbucks Crushes It on Social Media | Social Media Today. Retrieved

from http://www.socialmediatoday.com/content/how-starbucks-crushes-it-social-media

McNamara, T., & Moore-Mangin, A. (2015, August 3). Starbucks and Social Media: It’s About More than

Just Coffee – EContent Magazine. Retrieved from

http://www.econtentmag.com/Articles/Editorial/Commentary/Starbucks-and-Social-Media-Its-

About-More-than-Just-Coffee-103823.htm

Turban, E. (2012). Electronic commerce 2012: A managerial and social networks

perspective. Upper Saddle River, NJ: Pearson Prentice Hall.

Social Commerce & Marketing

Introduction

Amazon.com has numerous elements that allow customers to personalize and customize features and products. The question to ask is how effective are the various elements? Do they cause a customer to buy more products? Wal-Mart, too, has similar elements built into the eCommerce (EC) site. Is it effective and will it be a cause of concern for Amazon? Will Amazon continue to be the dominant force in etailing or will Wal-Mart, being the economic juggernaut that it is, prove to be a force to be reckoned with? Wal-Mart, after all, does have a history of displacing so-called leaders in the market when it opens a new store. This paper explores these questions to help better understand the dynamics at play here in eCommerce.

Personalization

Three personalization items to note are “Wishlists,” “Featured Recommendations” and “Recently Viewed.” Wish Lists allow the customer to create separate lists of items they might like to buy at some future time for themselves or someone else. An interesting thing about these lists is that if the customer waits long enough, they could see a significant drop in price. Amazon provides a way for me to schedule recurring orders for products that I use on a regular basis. The “Recommended for me” and “Recently Viewed” are Amazon’s way of suggestive advertising to see if the customer would consider buying more. It’s much like add-on products or like accessorizing; adding a matching pair of shoes to the dress you just bought (Amazon, 2016).

Where the real personalization takes place is with meeting the customers’ needs and one of the things that Amazon is known for is being a pioneer in personalization. Their use of data mining technology to make the consumer shopping experience much more memorable and exciting is being mimicked by all others, including Wal-Mart. Amazon uses the data gathered on its customer’s activities, besides to make the shopping experience more memorable to the shopper, it informs sellers what they should carry in inventory, how much they should carry in inventory, and what times of the year they should carry this suggested inventory (Rao, 2013).

Customization

Something to take note of is the types of customization in question here; one is for customizing products to meet consumer’s needs; much like what Dell Computers does for example. Secondly is for customizing web experience such as in allowing consumers to choose what they would like to see on their “page” and what the website shows you based on your previous activity. A customizable product would be difficult for Amazon to do since they’re an eTailer and not a manufacturer like Dell Computers for instance; that doesn’t prevent Amazon from aligning with manufacturers, like Dell to provide the consumer the ability to buy customizable products through Amazon. Amazon would certainly have to ensure a good fit since Amazon is a destination and most people wouldn’t consider Amazon to be a destination for buying a car, for instance. But Amazon does, to somewhat the same extent as Dell, provide available customization on some products, for instance, golf clubs or purchasing dress shirts. But it’s limited to what the manufacturer is willing to offer, much the same as Dell does, for instance. As for customization of the interface of either Amazon or Wal-Mart’s websites, there is no evidence that either allows for such customization (Amazon, 2016).

Amazon versus Wal-Mart

Will Wal-Mart be able to beat out Amazon online? Likely it will be an interesting battle, especially since Amazon recently became bigger than Wal-Mart with a market cap of $246 billion versus $230 billion respectively. Even though Wal-Mart’s overall sales are still greater than Amazon’s, Amazon is smoking Wal-Mart in eCommerce (D’Onfro, 2015). Amazon’s EC shopping has been seeing bigger and bigger sales percentage increases than Wal-Mart’s EC and brick-and-mortar combined, with the share of EC percentage of total sales rising from a mere 0.6% to 7% from 1999 to 2015 showing quarterly increases almost triple that of brick and mortar.

But other numbers spell out a clearer picture of the differences between Amazon and Wal-Mart: Wal-Mart has far more employees: 2.2 million to Amazon’s 154,100. Net sales are clearly a victory for Wal-Mart coming in with $482.2 billion versus Amazon’s $88.988 billion. But the following is where the difference is: Amazon’s year over year growth versus Wal-Marts has been 20% to 1.9%. Amazon’s product offerings equal 250 million versus Wal-Marts mere 4.2 million. Amazon adds 75,000 new products per day while Wal-Mart opened 115 new supercenters last year, and Amazon reaches 244 million active users with 154,000 employees versus Wal-Mart’s 2.2 million employees. The numbers tell the story (Peterson, 2015).

Avatars

In EC avatars have become quite common. They’re used extensively in eLearning and customer support. These are referred to as picons (personal icons), but that has long since stopped. Avatar as a word is derived from Hindu and is stands for the “descent” of a deity in a terrestrial out of body form (Avater-Wikipedia, 2015). Using an avatar can certainly be more efficient for the company since it doesn’t have actually to pay an actor or hire an actual human to interface with a customer; it seems that some people could be turned off from using one. It’s much like going through an automated answering system when you call your insurance company, very frustrating. Since the company using the avatar has to try to predict what the customer is going to ask commonly, it makes it difficult for that customer who asks a question that doesn’t quite fit the mold.

But in virtual world websites like in Second Life, the blend of virtual-world EC and the real world creates opportunities for creative marketers. Companies like MacDonald’s and Dell have created few instances of selling real-world products in virtual worlds to real-world customers and delivered them to their real-world addresses (Hemp, 2006)

Banner Advertising

A banner ad is an advertisement usually displayed across the top of a web page or along the side of the page and is commonly served up by an ad server. This advertising form is embedded into the web page. Its intention is to attract traffic to an advertiser’s website accessible because the ad hyperlinks to the advertiser’s website. Web banners function much like traditional advertisements in print media function: they serve to attract immediate attention to whatever the advertiser is selling in the hopes the viewer will be attracted and enticed enough to click on the ad. Interestingly, this data can be tracked from the ad: how many times the ad displayed; how many clicks; how far those who clicked went into the hyperlinked website from clicking in and out to actually purchasing the product (Web Banner-Wikipedia, 2015). What makes any ad popular? Banner ads are a quick and easy way to place your wares in front of millions of people all at once. Traditional full-page newspaper ads don’t even get that kind of coverage. Tracking a web page banner ad is certainly far simpler than tracking an ad in the yellow pages. And you can advertise just about any product from automobiles to children’s toys to food. Banner ads are much like billboard advertising because people are likely only taking a quick glance; makes it so they’re more appropriate for brand reinforcement than for unique product advertising.

Conclusion

As you can see, Amazon doesn’t need to fear Wal-Mart running it over in the EC world anytime soon. In fact, Wal-Mart needs to pick up the pace a tad bit it would seem (Peterson, 2015). Judging from the numbers, it seems Wal-Mart’s cost per sale is higher than Amazon’s. After all, Amazon is doing much more overall with a lot less personnel than Wal-Mart.

Avatars and banner ads certainly have their place in the EC world. Baner ads placement or use is limited: banner ads are placed somewhere in whatever medium happens to be popular at the moment. It used to be newspapers and magazines; now it’s the internet. Avatars are useful in areas like eLearning or introducing potential customers initially to a product or a service. The hope here, like banner ads, is that you click to exploring further into the connected website and possibly buy.

References:

Amazon.com: Online Shopping for Electronics, Apparel, Computers, Books, DVDs & more. (2016, February 13). Retrieved from https://www.amazon.com

Avatar (computing) – Wikipedia, the free encyclopedia. (2015, October 28). Retrieved February 13, 2016, from https://en.wikipedia.org/wiki/Avatar_%28computing%29

D’Onfro, J. (2015, July 25). Wal-Mart is losing the war against Amazon. Retrieved from http://www.businessinsider.com/wal-mart-ecommerce-vs-amazon-2015-7

Hemp, P. (2006, June). Avatar-Based Marketing. Retrieved from https://hbr.org/2006/06/avatar-based-marketing

Peterson, H. (2015, July 13). The key differences between Wal-Mart and Amazon in one chart. Retrieved from http://www.businessinsider.com/amazon-vs-wal-mart-in-one-chart-2015-7

Rao, L. (2013, August 31). How Amazon Is Tackling Personalization And Curation For Sellers On Its Marketplace | TechCrunch. Retrieved from http://techcrunch.com/2013/08/31/how-amazon-is-tackling-personalization-and-curation-for-sellers-on-its-marketplace/

Web banner – Wikipedia, the free encyclopedia. (2015, December 30). Retrieved February 13, 2016, from https://en.wikipedia.org/wiki/Web_banner

eGovernment & Technology

Introduction

eGovernment use of technology has grown over the years from using totally internal systems open only to government workers to today’s internet based systems that allow citizens to interact with their government. Government services today allow citizens to pay local utility bills online, pay taxes, and seek out government services to assist with building a business to getting a road repaired. Citizens can even read the minutes of the last board meeting and download a copy if they wish. Much of this interaction between government and its constituents can be done 24 hours a day, seven days a week, 365 days a year (Joseph, 2015).

But there will be a mix of ePortal style government sites in use for the foreseeable future. Much of this is due to the cost of creating and maintaining these web properties. Most local governments are ill-positioned to spend the tax dollars. Nor do they have the qualified personnel to manage the current system or to change to an internet based system. And, a basic mistrust on the part of local governments in using an internet based system; mostly with the security of such a system and their ability to control it. This post will explore various aspects of eGovernment and m-Commerce.

eGovernment Portal or Social Networking

The advantages of changing eGovernment from an ePortal system to a social networking system are in improving the efficiency over of the current system of paper-based work. It reduces the need for manpower needed in dealing with the bulk of paper-based work. Thus, it allows for involvement of the process by fewer employees, quicker service, and, therefore, leading to reduced operations cost (Tolley & Mundy, 2009). Other benefits include an increased participation by citizens in the activities of the government due to more information being literally at your fingertips. There is greater transparency in how the government operates and less chance for corruption to occur (Andersen, 2009).

Will government switch from an ePortal, or even paper based, system to a social networking system? The answer is an unequivocal yes. The reasons are that the technology will force the change. Society will force the change. Other levels of government will force the change. Changes in support for equipment, as well as the expense of maintaining the equipment, will cause local governments to switch to cloud-based applications. Constituents will make demands for information or assistance that requires easy access 24 hours a day.

Internal Initiatives

Internal initiatives provide tools that make government operations efficient and effective. Such applications as e-Payroll can consolidate dozens of different payroll systems into one easily managed system where employees can input their time worked, and the system automatically deposits their paycheck into their bank account. Other initiatives include records keeping, training of personnel, litigation case management, procurement management, personnel management and equipment management (Turban, 2012). All of these different apps run on an enterprise system very similar to what is used in many corporations today. All of these systems run across the enterprise on the internet successfully and securely.

The Role of Wikis and Blogs

Wikis and blogs serve the system by allowing groups and departments to collaborate on solving issues and problems. Many of these problems are cross-functional, and wikis allow the participants to be able to share information quickly and at less cost than having to make numerous copies for everyone. Wiki’s allow everyone to access all documents needed to hold a meeting. Wikis and blogs are valuable tools for sharing information and making decisions in government.

Strategic Advantage of m-Commerce

The strategic advantage of m-Commerce includes increasing the geographic area in which even a small company can sell a product. Many companies that make it big on the internet wouldn’t have done so if the internet didn’t exist because it would force them to sell in a smaller geographic location. These companies may be selling a specialized service or product which locally there isn’t much interest, but worldwide there is a huge market. The strategic advantage these companies have is the ability to reach those customers using m-Commerce that they would otherwise have to employ other methods such as advertising in national publications or on television; both very expensive alternatives. m-Commerce is growing by leaps and bounds every year. Two years ago sales for smartphones was greater than sales for laptops. Forecasts have sales for Ipads and tablets overtaking laptop sales by 2016 (Blodget, 2013).

m-Commerce provides true personalization because it provides the means to access personal information immediately from the palm of your hand. Medical Insurance companies such as Blue Cross Blue Shield, and Medical providers such as Advocate Health Care, provide mobile apps that provide immediate access to patient information. Patients become more involved with their care, and the portals provide information, such as what medicines they take and in what doses, upon request.

Conducting m-Commerce on Social Networks

The benefits of conducting m-Commerce on social network include increased sales because of being able to order from anywhere at any time. The ability for location-based sales benefit local business people, whose wares sell only in the local area; an example is a local restaurant that caters to the local community. M-Commerce provides a local channel for coupons providing a wider reach. It provides for improved customer satisfaction due to real-time apps providing direct information which helps increase sales. Reduces costs such as training and help-desk support staff. It improves the productivity of mobile employees such as service technicians repairing in-home appliances. iPads and tablets have been programmed to provide technicians with the tools in which to test or look up parts information; being able to place an order for parts saves time and money for both customer and supplier. Entertainment comes right to the user’s smartphone allowing them to watch a movie or television show any time of the day or night. Pizza can be ordered from your smartphone while on the way home from work, paid for using a credit card, and be on your table 20 minutes later. M-Commerce comes to users over a nationwide private communications network that the users do not have to maintain, yet regulated by the government for the good of all.

Conclusion

It stands to reason that what New Zealand is doing has helped to make their government run more efficiently because they’re sharing information across departments by using the various wikis and blog tools available. Internet technologies allowed them to share that information with the general public thus affording them valuable feedback that otherwise would have been cumbersome to gather. Many governments here in the US could certainly learn how to improve their m-Commerce sites by studying what New Zealand is doing today.

References:

Andersen, K. V., & Henriksen, H. Z. (2006). E-government maturity models:

Extension of the Layne and Lee model. Government Information Quarterly, 23(2),

236-248.

Blodget, H. (2013, December 11). Number of Smartphones, Tablets, and PCs –

Business Insider. Retrieved from http://www.businessinsider.com/number-of–

smartphones-tablets-pcs-2013-12

Joseph, S. (2015, September 1). Advantages and disadvantages of E- government

implementation: Retrieved from https://www.researchgate.net

Tolley, A., & Mundy, D. (2009). Towards workable privacy for UK e-government on the

web. IJEG, 2(1), 74. doi:10.1504/ijeg.2009.024965

Turban, E. (2012). Electronic commerce 2012: A managerial and social networks

perspective. Upper Saddle River, NJ: Pearson Prentice Hall.

eGovernment

eGovernment use of technology has grown over the years from using totally internal systems to internet based systems that allow citizens to interact with their government. Online services offered by local governments range from paying water/trash bills to paying taxes to read the minutes from the last board meeting. The government can run survey’s to get citizens opinions on the issues of the day and enables citizens to interact with all levels of government from Federal down to local levels 24 hours a day (Joseph, 2015).

One of the advantages of eGovernment is that of improving the efficiency of the current system of paperwork. It reduces the need for manpower to deal with the bulk of paper-based work. Thus, the process becomes more efficient and, therefore, leading to reduced operations cost (Tolley & Mundy, 2009). Other benefits include an increased participation by citizens in the activities of the government due to more information being literally at your fingertips. There is greater transparency in how the government operates and less chance for corruption to occur (Andersen, 2009).

A drawback to using eGovernment concern privacy issues. Potentially government information gathering may lead to a lack of privacy for civilians. There are very real concerns about turning over much information to the government by the citizens or businesses (Singel, 2007). The concern is that since the government is running the online system, the need for monitoring control will require very careful consideration.

Voting is one area of concern to using eGovernment. While voting on a touch screen can make voting easier, it can also be full of fraud since hacking systems are possible, and software can be coded fraudulently to favor one candidate over another. One answer to possible fraud is to have a paper backup of the ballot cast so that the vote count for both computer and paper has to match. Paper ballots with electronic readers are in use in elections in both Lake and McHenry Counties in Illinois.

RFID (Radio Frequency Identification) has been in use since WWII when the Germans used it to identify its returning aircraft from a mission (Roberti, 2005). Since that time RFID has expanded to allow literally for the identification of all kinds of products and services. Companies like Zebra Technologies, a leader in the development of bar code technology, has become a leader in RFID having developed passive and active RFID tags used today on drivers licenses. Companies, like Wal-Mart, use RFID exclusively to identify all products entering and leaving their system, and they require any company doing business with them to use the technology (Songini, 2006).

The government today is using RFID extensively on drivers licenses, and passports. The improvements in tracking the movement of people can occur in many areas of government. When traveling through airports, having a government issued ID can help quicken the check in through security since the TSA doesn’t have to type in every person’s name who comes before them. A quick scan provides all the information needed to identify the individual requesting admittance onto an airplane at the airport.

There are numerous limitations to m-commerce. First, the technology itself is limited. The use has to be within reach of a transmitting tower. Many parts of the world, many parts of the US, are not within reach of a cell tower. This inability to receive a signal limits the usage of the phone. There are limitations in the technology, especially when introducing new phones or when the signaling technology improves. While this may be good for manufacturers like Apple or Samsung, it creates havoc in the app world and for consumers who can either buy an upgrade or live with an inferior service (Lei, Chatwin, & Young, 2004).

References:

Andersen, K. V., & Henriksen, H. Z. (2006). E-government maturity models: Extension of the Layne and Lee model. Government Information Quarterly, 23(2), 236-248. doi:10.1016/j.giq.2005.11.008

Joseph, S. (2015, September 1). Advantages and disadvantages of E- government implementation: literature review (PDF Download Available). Retrieved from https://www.researchgate.net/publication

/281409802_Advantages_and_disadvantages_of_Egovernment_implementation_literature_review

Lei, P. W., Chatwin, C. R., & Young, R. C. (2004). Chapter 4: Opportunities and Limitations in

M-Commerce – Wireless Communications and Mobile Commerce. Retrieved from http://flylib.com /books/en/3.97.1.38/1/

Roberti, M. (2005, January 16). The History of RFID Technology – RFID Journal. Retrieved from http://www.rfidjournal.com/articles/view?1338

Singel, R. (2007, August 6). Analysis: New Law Gives Government Six Months to Turn Internet and Phone Systems into Permanent Spying Architecture – UPDATED | WIRED. Retrieved from http://www.wired.com/2007/08/analysis-new-la/

Songini, M. (2006, March 2). Wal-Mart details its RFID journey | Computerworld. Retrieved from http://www.computerworld.com/article/2562768/enterprise-resource-planning/wal-mart-details-its-rfid-journey.html

Tolley, A., & Mundy, D. (2009). Towards workable privacy for UK e-government on the web. IJEG, 2(1), 74.doi:10.1504/ijeg.2009.024965

Mass Customization in eCommerce

The idea behind mass-customization is to create specific products based on the customer’s needs and to deliver that product quickly. Personalization is where the customer’s preferences are aligned with the products being advertised.

Personalization is quite common on Social Media like Facebook or Google. If you mention on FaceBook that you’re thinking about buying a car, you will begin to see ads for cars on your FaceBook site. Likely you will also see those ads on Google as they see what topics I’m searching. What is interesting about personalization is not that neither Google nor FaceBook really care, nor does the advertiser, who you are, they just care that you’ve expressed an interest in a topic. The advertiser has bought certain keywords from either Google or FaceBook so that when those keywords are used that advertisers ads will appear. The FaceBook user is unknown to the advertiser until the user decides to let the advertiser know their identity.

Knowledge of your interests can be kept in on a cookie that contains as a user profile and is put on your hard drive of your computer, frequently without you knowing about it or without your permission (Turban, 2012). Some sites do it differently. Amazon, for instance, uses your past buying history to determine the ads or suggestion you see. Google just simply relies on current information as you’re browsing. Personalization also extends to cell phones, tablets, and other forms of digital media (Personalization-Wikipedia, 2016).

Mass-customization is where the customer gets to order a product based on their preferences and it is usually delivered within a short period of time (McCarthy, 2004). Dell Computers is a prime example of a company that has mass-customization down to a science (Mass-Customization-Wikipedia, 2016). The customer will place an order for a laptop that contains certain features they prefer. The customer pays for the order via credit card; Dell sends the order to the factory which produces the ordered laptop. The laptop is then shipped to the customer, usually within 1 week. Mass customization aims to deliver customized products while using the efficiency of mass production (Chen, 2009). The idea is to be to control the costs of production while also meeting the demands of the market.

Amazon’s critical success factors are in its basic challenge: How does it sell consumer goods online and show a profit and decent return on investment. Amazon sells in three basic categories: media, electronics, and other products including Kindle, office supplies, cameras, and toys (Turban, 2012). Amazon has to ensure that it is the innovator in the field constantly staying ahead of the competition in offering a broad variety of products, make it easy to buy from them and even allow the customer to easily return products when not satisfied. This is a good strategy as it makes it a one stop shop online. One just needs to look at Wal-Mart or Target to see the success of one stop shopping. By making it easy to do business with them, Amazon makes it the destination of choice whenever one is shopping, wherever one is shopping. The shopper can access Amazon via their smartphone in Wal-Mart and do comparison shopping right on the spot; even buy it while standing in the store. All of this makes it so that Amazon will continue to grow into the foreseeable future (Amazon-Wikipedia, 2016).

Having recently bought an iPhone 6S+ I was able to go to the Apple website and view the phone, see the different features, and weigh various price breaks. From their website I was able to make the decision between the smaller versions versus the bigger versions by viewing the differences online. But full trust in what I was buying didn’t occur until I went to the Apple store to actually touch and feel the product.

One way that online retailers have solved the problem of trust is by allowing shoppers to buy and easily return, satisfaction guaranteed. Zappos is a prime example of where a customer can buy several sizes of the same shoe, try them on, and return those items that don’t satisfy (Zappos-Wikipedia, 2015). Online trust is difficult to achieve due to the fact that a potential customer cannot touch or examine the product. Without a good return policy, many people will simply not buy the product. Another good policy is allowing customers to rate the product. Amazon encourages and publishes customer opinions on their purchases because they know it encourages others to buy.

References:

Amazon.com – Wikipedia, the free encyclopedia. (2016, February 11). Retrieved February 11, 2016, from

https://en.wikipedia.org/wiki/Amazon.com
Chen, S., Wang, Y., & Tseng, M. (2009). Mass customisation as a collaborative engineering effort.

International Journal of Collaborative Engineering, 1(1), 152.

Mass customization – Wikipedia, the free encyclopedia. (2016, January 4). Retrieved February 11, 2016,

from https://en.wikipedia.org/wiki/Mass_customization

McCarthy, I. P. (2004). Special issue editorial: the what, why and how of mass customization. Production

Planning & Control, 15(4), 347-351. doi:10.1080/0953728042000238854

Personalization – Wikipedia, the free encyclopedia. (2016, February 11). Retrieved February 11, 2016, from

https://en.wikipedia.org/wiki/Personalization

Turban, E. (2012). Electronic commerce 2012: A managerial and social networks perspective. Upper Saddle

River, NJ: Pearson Prentice Hall.

Zappos – Wikipedia, the free encyclopedia. (2015, December 15). Retrieved February 11, 2016, from

https://en.wikipedia.org/wiki/Zappos

How can Electronic Commerce be a business pressure and an organizational response?

Introduction

How can eCommerce (EC) be a business pressure and an organizational response? Has EC somehow lost the human interaction or touch? Why do businesses change their business models in the digital age? How has EC affected dynamic and fixed pricing of products or services? What are the risks of using Web 2.0 tools? These questions are the gist of this paper and they will be discussed briefly herein.

Business Pressure and Organizational Response

With ever-changing business climates, globalization, technical advancements, changing governmental rules, and societal factors are creating a highly competitive business environment. Many of these factors can change quickly and unpredictably (Turban, 2012). Business must be nimble and agile in order to respond to the circumstances. Electronic Commerce (EC) can be the means in which a company responds effectively to an ever-changing business environment.

These business pressures are divided into a market (economical), societal, and technological categories. The market or economic, pressures include stronger competition, much from a global economy; includes regional trade agreements, such as NAFTA, and low wages in many third world nations. Societal pressure includes the changing workforce, government regulation/deregulation, shrinking governmental subsidies or increasing subsidies, and rapid political changes including terrorism. Technical pressures are due to the rapid change in technology almost on a daily basis including product obsolescence and rapid advancement.

The question of how EC can be a business pressure and an organizational pressure can be seen in having to respond to the various changes that occur in the marketplace, in society, or in government changes that occur. An example would be when Sarbanes-Oxley Act of 2002 (SOX) was passed by the Federal Government in response to gross accounting irregularities of companies like Enron and WorldCom. The law imposed stringent requirements on accounting reporting and management’s responsibility for the information contained therein. The business pressure was the SOX requirements and how could EC provide the answer to meeting those requirements. Today there are many accounting applications businesses can use that are readily accessible from the cloud such as Intuits QuickBooks.

Elimination of Human Touch

Some claim that digital business eliminates the “human touch”. The loss of human contact with the digital age is likely a tad overblown. While there have been significant changes in manufacturing due to automation, there has also been a significant increase in the number of ways in which we are able to reach out and touch someone. When you get down to it, EC has really created much more ways for humans to interact with the world around us (NSF, 2015)

The coming of digital technology has certainly changed the way people interact and do business. For example, people used to talk with each other face-to-face. We had to go to the local store in order to buy a loaf of bread. Of course, that type of communication took place in a very limited manner and it was with people who lived within your local community. Today millions of people across the world are interacting via Facebook. One can call a friend living in Holland from the US at little to no costs and talk for hours using Skype. Our local community has become worldwide. Just because we use Facebook for better than three hours a day on average doesn’t relinquish the requirement to build trust and lasting friendships (Fuller, 2014). We still need that human contact as a species.

Changing Business Models

Why do companies frequently change their business model? What are the advantages and disadvantages? Companies frequently change their business models when it becomes either advantageous or necessary to do so. Advantageous because the business stands to gain financially from making an EC change that would make them more competitive. Necessary because if the business doesn’t change they will be less competitive and perhaps out of business as a result.

An example would be when many companies like Sears and JC Penney decided to quit producing their old line print catalogs in favor of producing an online catalog of the goods they sell. By producing the catalog online they were able to see huge cost savings and an increase in sales. Plus, each company was able to reach out to many more potential customers by using social media, email, and online advertising to draw people to their online catalogs (Turban, 2012).

Effects on Dynamic and Fixed Pricing

Discuss the advantages of dynamic pricing over fixed pricing? What are the potential disadvantages of dynamic pricing? Dynamic pricing is based on supply and demand of a given product. The pricing is considered dynamic as it fluctuates depending on the circumstances of supply and demand. The process could include a company posting a bid to buy or sell a product, a forward/reverse auction; buyers/sellers see the offers/bids online and they interact in real time competing with the other buyers/bidders but they may not whom they are competing with. Many variables have to come into play in order for the transaction to be completed such as price, time, location and other variables before the transaction is completed (Turban, 2012). The advantages are numerous for these types of interactions. It is easier to conduct an auction online than it is at a physical location; one has to actually secure a location, hire people to help run the auction, bring the product to the location. EBay, for instance, conducts auctions on hundreds of thousands of products daily without a physical structure in which to show all of these products. Everything is shown in the customer’s living room on their computers. These customers can view the products at their leisure when they want to. They can watch the bidding in real time, they know what they’re buying, and thus eBay is not losing customers due to the fast nature of live auctions.

Fixed pricing means the price is set, the only negotiating may be quantity price breaks or sales deals of the moment. Many companies offer the opportunity for the consumer, mostly on the retail side, to do comparison shopping so they can see if they’re getting a good deal at a good price.

Web 2.0 Risks

Web 2.0 tools include social media, wikis, blogs, Business Intelligence Analytics, dashboards, chat rooms and much more than can be listed here. The ability of Web 2.0 to change our lives has been tremendous and exciting. One of the main risks with Web 2.0 is that it has opened us up to the possibility of fraud. Craigslist is an example of where the possibility of fraud exists as there have been numerous complaints of illegal ads and other practices (Wikipedia, 2016). Security issues abound, especially with credit card usage. Hackers have the ability to access transactions as they occur, especially at ATM’s. The government realizes the benefits of using Web 2.0 technology, but they also understand the risks (Uthayasankar, Zahir, & Vishanth, 2015). Today we see the proliferation of anti-virus software like Norton, or the growth of cybersecurity companies like Palo Alto, Inc. Many companies, when considering using Web 2.0, have to weigh the benefits with the risks. They have teams of developers that concentrate on areas that help to secure the benefits being delivered.

Conclusion

Has EC had a profound affect on our lives. Yes, it has, even for those who claim it hasn’t. Everywhere we go we see the effect of Web 2.0 technology being used even if we don’t realize it. Business are constantly changing the way they do business. People are communicating more and sharing more than at any time in human history. Just look at Facebook for proof of sharing. Does it all have its downside? Of course, it does. Jobs have been eliminated due to changes in technology. Just look at the coal industry as an example; in 1920, almost 785,00 people were working in the coal industry. Today around 80,000 are employed in the production or use of coal. The cause of the decline is due to modernization (SourceWatch, 2015). Is it risky to use Web 2.0 technology, yes it is. But the benefits outweigh the risks. Just looking at the effect on dynamic pricing activities shows how much more efficient the whole system works is proof of the positive effect on society Web 2.0 has had.

References:

Coal and jobs in the United States – SourceWatch. (2015, June 26). Retrieved from

http://www.sourcewatch.org/index.php/Coal_and_jobs_in_the_United_States

Craigslist – Wikipedia, the free encyclopedia. (n.d.). Retrieved February 5, 2016, from

https://en.wikipedia.org/wiki/Craigslist

Fuller, E. (2014, March 20). Are we losing touch in this age of digital communications? Retrieved from

http://www.forbes.com/sites/edfuller/2014/03/20/are-we-losing-touch-in-this-age-of-digital-

communications/#13c6589963e7

NSF (2015). The Internet, Changing the way we communicate. (n.d.). Retrieved from https://www.nsf.gov

/about/history/nsf0050/pdf/internet.pdf

Turban, E. (2012). Electronic commerce 2012: A managerial and social networks perspective. Upper Saddle

River, NJ: Pearson Prentice Hall..

Uthayasankar, S., Zahir, I., & Vishanth, W. (2015, October 4). Evaluating the use and impact of Web 2.0

technologies in local government. Retrieved from http://www.sciencedirect.com/science/article

/pii/S0740624X1500076

Applying the work breakdown structure to the project management lifecycle

A Critique of

Shelly A. Brotherton, PMP

Robert T. Fried, PMP

Eric S. Norman, PMP, PgMP

Article

“Applying the work breakdown structure to the project management lifecycle”

Table of Contents

Abstract

Introduction

WBS Structure

Work Packages

Aligning with Scope

Going from WBS to Scheduling

Conclusion

Abstract

To some the Work Breakdown Structure (WBS) can be a burdensome chore. To others it is a necessary tool in which to define the tasks, and only the tasks needed, to complete a project successfully. Today, project managers are discovering the high value associated with creating work breakdown structures (WBS) early in the course of project management and a projects success may be attributed specifically to use of a WBS.

Project Managers know that many things can and do go wrong with projects. Much of the failures can be attributed directly to poor planning, and especially with poor development of a WBS. Ms. Brotherton, Mr. Fried, and Mr. Berman article discusses in detail the concepts and usage of a deliverable-oriented WBS in project management. This paper discusses their views on using a WBS in a project, its development and usage throughout the project, and compares their analysis with the goals of the class syllabus.

Introduction

The Work Breakdown Structure (WBS) is used in project management to identify and organize the tasks needed in which to complete a project successfully. It only calls for those tasks needed, and only those tasks needed, in which to reach a successful outcome (PMBOK, 2013).

The WBS can be very basic or it can be very sophisticated. WBS’s can be simple, perhaps too simple. The Project Manager (PM) has to be careful not to create a WBS that is too simple that it fails to adequately identify and describe the tasks needed to complete the project. This poorly developed WBS causes misunderstanding, rework, and leads to costly delays. It can also make it difficult to identify when problems arise due to an inability to identify what needs to be done and in what order.

The WBS can also be over-complicated, from decomposing work packages too much so that it over defines how the work is to be done, to having so many work packages with short durations it makes it difficult, if not impossible, to manage.

Ms. Brotherton, Mr. Fried, and Mr. Berman article, “Applying the work breakdown structure to the project management lifecycle” discuss in detail how a deliverable-oriented WBS is applied to a project and focuses on why the WBS is needed while also pointing out some of the pitfalls to be aware of. They point out that project success can be directly attributed to creating a well thought out WBS (Brotherton, 2008). Poorly developed or planned WBS can result in detrimental project outcomes including re-planning, rework, unclear work assignments, scope creep, increasing budget costs, missed target dates, unusable products and/or delivery features. Even worse, you have a very unhappy project sponsor.

WBS Structure

When planning a project the project manager needs to determine the work that needs to be done to complete the project successfully. He does this by creating a Work Breakdown Structure (WBS). A WBS is the process of subdividing the project deliverables and project work into smaller and smaller elements commonly referred to as work packages (PMBOK, 2013).

The WBS provides a common framework from which to organize all the work needed to complete the project. A WBS can be made up of different levels with the number of levels determined by the project needs. The first three levels will usually reflect the integrated efforts of the project. Level one, sometimes called the “home” level, concerns the authorization and release of work. Another rule to keep in mind is the 100% rule (Kerzner, 2009). The 100% rule represents 100% of the total work of the project. Each level below the previous level has to add up to 100% of the level above it. Level two is reserved for budgetary information; level three usually involves scheduling. Levels four and lower make up the work packages of the project. The sum of the work of the child level must equal 100% of the work at the parent level. Each level is planned in sequential order identifying dependencies and order of completion keeping in mind that some tasks can be done in parallel to others.

Work Packages

Each of these work packages need to be manageable, independent or have minimal interface with other ongoing elements, be Integratable and measureable. It has to have clearly defined start and end dates. All objectives must be linked to company goals. Responsibilities for each element is determined and assigned using a responsibilities assignment matrix (RAM). The focus should be on deliverables deriving tasks and organizing those tasks into work packages (Brotherton, 2008).

A work package represents a decomposition of the upper level deliverables into fundamental elements where the components are verifiable and measurable. Verifying the level of decomposition only requires doing the amount of work that is necessary and sufficient to complete the deliverable required by the project. Ideal packages are usually 80 hours or two to four weeks in length (PMBOK, 2013).

Aligning with Scope

One important aspect of a WBS is to ensure that each of the deliverables and associated tasks align with the goals of the project and the company. The PM can do this using a scope sequencing process to show dependencies between different elements identified in the WBS. Like in building a house, you need to show the sequence of the different parts of the deliverables identified in the scope of the project; first you need the foundation, then the walls, than the roof. The PM can show this relationship by using a dependency diagram (Brotherton, 2008):

Going from WBS to Scheduling

One issue bothersome to PM’s has always been taking the various levels of the WBS from definition to actual scheduling. Brotherton points out the PMBOK guide shows the PM specifically how to go from a deliverable-oriented WBS to scheduling in five easy steps (Brotherton, 2008).

First: The PM defines the activities. The tools used here are decomposition, rolling wave planning, and expert judgment (PMBOK, 2013)

Second: Sequencing the activities. As just stated, you need to set the order in which the activities are to be done. You do this by identifying the relationships and the dependencies between elements.

Third: Estimating the resources needed. How many people are needed for which task. This part of the process will help with determining the budget for the project.

Fourth: Estimating project durations. Here the PM, using tools like past history and expert judgment, determines how long each task should take. Combined with number three above a total budget can be estimated.

Fifth: Develop the project schedule. With all of the above information, a project schedule can be determined thus documenting the total time it should take to complete the execution portion of the project. Add in a start date and a completion date can be determined.

Conclusion:

The WBS is a very important piece of a project. It further defines the scope of the project so that by its completion the sponsor, the steering committee and the project team will have a fully approved understanding of what their project entails. It will provide a detailed description of all the tasks needed to complete the required deliverables within the scope of the project. It will show the sequence in which the work needs to be done. It will be a useful tool in determining the scheduling of the project and for being able to track those activities to ensure the project is on schedule and within the scope and cost of the project since everything within the WBS is trackable (Fleming, 2010).

References:

Brotherton, S. A., Fried, R. T., & Norman, E. S. (2008). Applying the work breakdown structure to the project management lifecycle. PMI. Retrieved from http://www.pmi.org/learning/applying-work-breakdown-structure-project-lifecycle-6979

Fleming, Q. W., & Koppelman, J. M. (2010). Earned value project management. Newtown Square, PA: Project Management Institute.

Kerzner, H. (2009). Project management: A systems approach to planning, scheduling, and controlling. Hoboken, NJ: John Wiley & Sons.

Project Management Institute. (2013). A guide to the project management body of knowledge (PMBOK guide), fifth edition. Newtown Square, PA: Author.

WBS Explained

WBS stands for “Work Breakdown Structure”. Simply put, it delineates the work required to complete the project. A WBS makes a Project Managers life easier, and it ensures a complete understanding of the work required to complete the task at hand. A WBS is the delineation of the scope into work packages and activities required to complete successfully. It represents total project scope as well as product scope.

I have witnessed during my time as a Project Manager many a practicing project manager not using the WBS correctly or at all. Many find it burdensome; others think it’s useless, and others just do not understand how it. What’s worse is when management sees no value in the exercise of putting a WBS together.

A WBS is easy to understand and quite easy to create. It has immense effectiveness serving as an anchor for many a successful completed project. There are numerous publications that can guide you in developing a WBS. I will focus on the importance of a WBS to the project and some detail on writing one.

A WBS takes time, thought, and collaboration. It should have a method for identifying the hierarchy in either a hierarchical chart or as an outline. It should include a WBS Dictionary that explains in detail how to complete each package/activity. The dictionary spells out the expectation of the deliverable.

A WBS can receive information from:
- The scope management plan
- The scope statement
- The requirements document
The WBS is related to:
- WBS dictionary
- Scope baseline
It provides information to
- Activity list
- Activity cost estimates
- Project budget
- Risk register
- Accepted deliverables

What is the difference between a deliverable and activity?
A deliverable is the result or outcome of series of activities. The activity represents a small portion of the total work package and deliverable.

Why is WBS important?

WBS is a hierarchical representation of the scope of a project; it represents the total scope of work required.
- A WBS represents the total scope and hence it can act as a checklist for the project.
A Project Manager can easily see the completed work and what is work remains in the project.
- The deliverable represented by the WBS is easily monitored and tracked.
- Each successive level of WBS provides a basis for more precise estimation of remaining effort, duration, resources and cost in which to complete the project.
A WBS can serve as a template for future similar projects – specifically for repetitive processes thus making future projects easier and faster to plan.
Activities are easily assigned to team members making accountability easier.

A WBS can reduce project risk.

Remember:

A WBS uses nouns and adjectives to define work.
The key is that we are talking about the nouns, the (mostly) tangible objects created through project work.
Always put deliverables in the first couple of levels
Only move from deliverables to tasks when you’ve pushed down several levels, and have gotten to packages that are reasonably small and estimable.
The tasks to be performed are always in support of a deliverable.