20-751 ecommerce technology fall 2003 copyright © 2003 michael i. shamos ecommerce technology...
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20-751 ECOMMERCE TECHNOLOGY
FALL 2003
COPYRIGHT © 2003 MICHAEL I. SHAMOS
eCommerce Technology20-751
Lecture 1: Overview
20-751 ECOMMERCE TECHNOLOGY
FALL 2003
COPYRIGHT © 2003 MICHAEL I. SHAMOS
Course Administration
• Instructor: Michael Shamos ([email protected])
• Teaching assistant: Jie Hu ([email protected])
• Course web page: through Blackboard or http://euro.ecom.cmu.edu/program/courses/tcr751/official.shtml
• Slides posted on web page the night before lecture• 14 lectures, 4 homeworks, 1 final exam• Grading
– Homework 40% (10% each)– Class participation 10%– Final exam 50%
20-751 ECOMMERCE TECHNOLOGY
FALL 2003
COPYRIGHT © 2003 MICHAEL I. SHAMOS
Working Together• You may (and should) study together and discuss homework
• You should surf the Web to learn more about course topics
• BUT: ALL WORK YOU SUBMIT MUST BE YOURS ALONE• You must list the names of the people you worked with
• You must give credit for any material that is not yours
• If you need to include material from another source, state exactly where it came from (give URL, etc.)
• DO NOT ATTEMPT TO COPY MATERIAL FROM WEB PAGES AND SUBMIT IT AS YOUR HOMEWORKYou will be caught. Your career will end. Fast.
• Penalties for violation: zero credit, course failure, expulsion
• See University Policy on Cheating and Plagiarism
20-751 ECOMMERCE TECHNOLOGY
FALL 2003
COPYRIGHT © 2003 MICHAEL I. SHAMOS
What is Commerce?
• Middle French, from Latin commercium, fromcom- (together)+ merc- (merchandise) (1537) “The exchange or buying and selling of commodities on a large scale involving transportation from place to place.”
• Buying and selling ( transactions )• Large scale ( scalability )• Transportation ( supply chain )• Every business process in the world must be
re-engineered: “Can it be made electronic?”
NEED TECHNOLOGYTO SUPPORTALL OF THESE
20-751 ECOMMERCE TECHNOLOGY
FALL 2003
COPYRIGHT © 2003 MICHAEL I. SHAMOS
Commerce (8000 B.C.)
BUYERFINDS
SELLER
NEGOTIATION
PAYMENT
SALE
DELIVERY
POST-SALEACTIVITY
SELECTIONOF GOODS
INFORMATION
PHYSICAL+INFORMATION
20-751 ECOMMERCE TECHNOLOGY
FALL 2003
COPYRIGHT © 2003 MICHAEL I. SHAMOS
eCommerce
BUYERFINDS
SELLER
NEGOTIATION
PAYMENT
SALE
DELIVERY
POST-SALEACTIVITY
SELECTIONOF GOODS
SEARCH ENGINE
SHOPPING BOT
AGGREGATOR
ON-LINE CATALOG
AUTOMATED AGENTS
TRACKING AGENT
ON-LINE HELP
INTERNET TELEPHONY
CUSTOMER PREFERENCES
BARGAINING STRATEGIES
PRICE SENSITIVITIES
CREDIT/PAYMENT INFORMATION
ON-LINE PROBLEM REPORTS
FOLLOW-ON SALES OPPORTUNITIES
SOME TECHNOLOGIES USED: SOME INFORMATION GATHERED:
BROWSING BEHAVIOR
DELIVERY REQUIREMENTSE-PAYMENT SYSTEMS
CONFIGURATOR
RECOMMENDER AGENT
TRANSACTION PROCESSOR
DATA INTERCHANGE
CRYPTOGRAPHY
BROWSER SHARING
MARKET BASKET
PERSONAL DATA
CUSTOMER SATISFACTION
SEARCH BEHAVIOR
EFFECTIVENESS OF PROMOTIONS
INFORMATION
PHYSICAL+INFORMATION
Voice(IVR, ACD)
Voice(IVR, ACD)
E-MailE-Mail
Direct Interaction
Direct Interaction
SalesAuto.SalesAuto.
MarketingAuto.
MarketingAuto.
Mobile Sales(Prod. CFG)
Mobile Sales(Prod. CFG)
FieldServiceField
Service
Portal/Portal/ExtranetExtranetPortal/Portal/
ExtranetExtranet
EDIEDIEDIEDI
E-MailE-MailE-MailE-Mail
Financ.DM
Financ.DM
HRDMHRDM
Prod.DM
Prod.DM
DWDW
Closed-Loop Processing(EAI Toolkits, ETLM Tools, Embedded Mobile Agents)
Closed-Loop Processing(EAI Toolkits, ETLM Tools, Embedded Mobile Agents)
Cust.DM
Cust.DM
OrderDM
OrderDM
S2SS2SS2SS2S
Co
llab
ora
tive
SC
M
Co
llab
ora
tive
CR
M
Operational
SCMSCM ERPERP CRMCRM
Conf.Conf.
WebStorefront
WebStorefront
Collab.Collab.PlanningPlanningCollab.Collab.
PlanningPlanning
Conf.Conf.Conf.Conf.
Mfg.Mfg.Exec.Exec.Mfg.Mfg.
Exec.Exec.
WHWHMgmt.Mgmt.
WHWHMgmt.Mgmt.
Trans.Trans.Mgmt.Mgmt.Trans.Trans.Mgmt.Mgmt.
Demand Demand PlanningPlanningDemand Demand PlanningPlanning
Trans.Trans.PlanningPlanningTrans.Trans.
PlanningPlanning
Distrib.Distrib.PlanningPlanningDistrib.Distrib.
PlanningPlanning
SupplySupplyPlanningPlanningSupplySupply
PlanningPlanning
Mfg.Mfg.PlanningPlanning
Mfg.Mfg.PlanningPlanning
KM/CMKM/CM
Analytical
Svc.Auto.Svc.Auto.
LogisticsLogisticsLogisticsLogisticsHRHRHRHRMfg.Mfg.Mfg.Mfg. FinanceFinanceFinanceFinance
EmployeeEmployeeSystemsSystems
EmployeeEmployeeSystemsSystems
Industry-Industry-Specific Specific SolutionsSolutions
Industry-Industry-Specific Specific SolutionsSolutions
Strategic Strategic PlanningPlanningStrategic Strategic PlanningPlanning
LegacyLegacySystemsSystemsLegacyLegacy
SystemsSystems
Employee Employee SSSS
Employee Employee SSSS
Fact. HH Fact. HH DevicesDevices
Fact. HH Fact. HH DevicesDevices
ProductProductMgmt.Mgmt.
ProductProductMgmt.Mgmt.
OrderOrderMgmt.Mgmt.OrderOrderMgmt.Mgmt.
Web/Web/IntranetIntranet
Web/Web/IntranetIntranet
SOURCE: META GROUP
THE ELECTRONIC ENTERPRISE
ACD = AUTOMATIC CALL DISTRIBUTORCFG = CONFIGURATIONDM = DATA MININGDW = DATA WAREHOUSEETLM = EXTRACT, TRANSFORM, LOAD & MANAGEHH = HAND-HELDIVR = INTERACTIVE VOICE RESPONSE
SUPPLY CHAINMANAGEMENT
ENTERPRISE RESOURCEPLANNING
CUSTOMER RELATIONSHIPMANAGEMENT
20-751 ECOMMERCE TECHNOLOGY
FALL 2003
COPYRIGHT © 2003 MICHAEL I. SHAMOS
Manufacturers
Customers
LogisticsProviders
WholesaleDistributors
Suppliers
LogisticsProviders
ContractManufacturers
VirtualManufacturers
SupplierExchanges Logistics
ExchangesCustomerExchanges
Information Flow
Goods Flow
SOURCE: AMR RESEARCH (2000)
Internet-Connected Supply Chain
20-751 ECOMMERCE TECHNOLOGY
FALL 2003
COPYRIGHT © 2003 MICHAEL I. SHAMOS
Why eCommerce? Why Now?
• Computers are faster– 1973: 1 million instructions/sec– 2003: 2 billion instructions/sec
• Have more main memory– 1973: 0.125 megabytes– 2003: 512.0 megabytes
• Cost less– 1973: $4,000,000– 2003: $1,000
• Speed/size/cost improvement factor: 32 billion
20-751 ECOMMERCE TECHNOLOGY
FALL 2003
COPYRIGHT © 2003 MICHAEL I. SHAMOS
Progress of Technology
• Have more disk storage– 1973: 10 MB
– 2003: 120,000 MB (soon 1 terabyte = 1000GB)
• Higher communication speeds– Human speech: 30 bits/sec
– 1973 Modem 300 bits/sec
– 2003 Modem: 56,000 bits/sec
– T1 line: 1,544,000 bits/sec
– DSL (high end) 7,000,000 bits/sec
– Internet 2: 1,000,000,000 bits/sec
– Optical 10,000,000,000,000 bits/sec in 1 fiber (entire U.S. telephone traffic)
IMPROVEMENT: 12000 x
1973-2003IMPROVEMENT:
30 BILLION x
20-751 ECOMMERCE TECHNOLOGY
FALL 2003
COPYRIGHT © 2003 MICHAEL I. SHAMOS
eCommerce Technology Topics
• Infrastructure • Electronic payments • Wireless • Databases• Web Architecture • Mass personalization, CRM,
Data Mining• Search engines • Privacy Technology• Cryptography • Enterprise Resource Planning • Network security • Intelligent agents
• Data interchange
20-751 ECOMMERCE TECHNOLOGY
FALL 2003
COPYRIGHT © 2003 MICHAEL I. SHAMOS
eCommerce Infrastructure
• What worldwide structure is required to support eCommerce?
• Network + communications– Required course: Communications and Networking (20-770)
• Machines• Software
– Required course: Core Java for eCommerce (20-753)
• Protocols• Security• Payment
– interface to banking systems
20-751 ECOMMERCE TECHNOLOGY
FALL 2003
COPYRIGHT © 2003 MICHAEL I. SHAMOS
The Internet
• The fundamental technology linking business and people around the world in less than 1 second– Nothing competes with it
• How does it work?• How big is it?• Who owns it? Who governs it?• How does it grow? How big can it get?• What architecture allows this?• What are the limitations?
• Required course: The Internet (20-755)
20-751 ECOMMERCE TECHNOLOGY
FALL 2003
COPYRIGHT © 2003 MICHAEL I. SHAMOS
Wireless Technologies & mCommerce
• Can’t get (much) away from radio• Differences between wireless and wired communication• Cells, frequency allocations• Shared medium: SDMA, FDMA, TDMA, CDMA• 1G, 2G, 2.5G, 3G, 4G• Wireless LAN: IEEE 802.11• Bluetooth• WAP, iMode• Universal Wideband (UWB)
• Elective Course: Mobile eCommerce (20-863)
20-751 ECOMMERCE TECHNOLOGY
FALL 2003
COPYRIGHT © 2003 MICHAEL I. SHAMOS
Web Architecture
SOURCE: INTERSHOP
How are web sites constructed?
TIER 1TIER 2Server
TIER 3Applications
TIER 4Database
Elective Course: eCommerce Web Application Development (20-860)
20-751 ECOMMERCE TECHNOLOGY
FALL 2003
COPYRIGHT © 2003 MICHAEL I. SHAMOS
Search Engines
• Finding web pages– Crawlers, spiders, bots
• Query interfaces• Retrieval methods
– Indexing– Document ranking– Artificially altering retrieval order
• Document clustering• Multilingual issues• Multimedia retrieval
• Required Course: Web-Based Information Architectures (20-760)
20-751 ECOMMERCE TECHNOLOGY
FALL 2003
COPYRIGHT © 2003 MICHAEL I. SHAMOS
Cryptography• Secrecy
– Information cannot be used if intercepted
• Authentication– We’re sure who the parties are
• Integrity– Data cannot be altered
• Non-repudiation– Sender cannot deny sending the message
• Cryptography– Symmetric encryption (DES, Rijndael)– Public key cryptosystems (RSA)– Digital signatures & certificates, public key infrastructure (PKI)
20-751 ECOMMERCE TECHNOLOGY
FALL 2003
COPYRIGHT © 2003 MICHAEL I. SHAMOS
Network Security• Access control
– authorization / authentication• Authentication
– something you know: passwords– something you have: smart card– something you are: biometrics– someplace you are: GPS
• Network protection, firewalls, proxy servers• Intrusion detection• Denial of service (DOS) attacks• Viruses, worms
• Required course: Computer Security
20-751 ECOMMERCE TECHNOLOGY
FALL 2003
COPYRIGHT © 2003 MICHAEL I. SHAMOS
Data Interchange
• How can sites exchange information without prior agreement?– What do the data fields mean? price, extended price, unit
price, prix, цена, τιμή, 가격 , X’AC12’
– XML: Extensible Markup Language
• How can machines communicate without humans?• How can data formats and structures be
communicated?– XML schemas– Ontologies
20-751 ECOMMERCE TECHNOLOGY
FALL 2003
COPYRIGHT © 2003 MICHAEL I. SHAMOS
eCommerce Data Exchange Needs
Ship Notices
Bills of Lading Electronic Payments
Purchase Orders
Invoices
RFQs Catalogs Quotations
Letters of Credit
20-751 ECOMMERCE TECHNOLOGY
FALL 2003
COPYRIGHT © 2003 MICHAEL I. SHAMOS
Electronic Payments• Forms of money
– token (cash), notational (bank account), hybrid (check)
• Credit-card transactions– Secure protocols: SSL, SET
• Automated clearing and settlement systems– PayPal
• Smart cards, electronic cash, digital wallets
• Micropayments
• Wireless payments
• Electronic invoice presentment and payment– Moore
• Required course: Electronic Payment Systems (20-763)
20-751 ECOMMERCE TECHNOLOGY
FALL 2003
COPYRIGHT © 2003 MICHAEL I. SHAMOS
Databases
• The relational database model• Query specification: SQL (Structured Query Language)• Database management• Databases in eCommerce• Data warehousing
• Required course– Database Management (Heinz School)
20-751 ECOMMERCE TECHNOLOGY
FALL 2003
COPYRIGHT © 2003 MICHAEL I. SHAMOS
Mass Personalization & Data Mining
• Treating each user as an individual– key is INFORMATION
• How to acquire and store information about customers– Cookies– Question and response– Clickstream analysis– External databases. Allegheny County
• How to use information effectively and instantly• Personalization technology• Customization: Lands’ End
20-751 ECOMMERCE TECHNOLOGY
FALL 2003
COPYRIGHT © 2003 MICHAEL I. SHAMOS
Data Mining
• Extracting previously unknown relationships from large datasets
• Discovery of patterns• Predicting the future
– past behavior as predictor of future purchasing• Market basket analysis
– diapers/beer
20-751 ECOMMERCE TECHNOLOGY
FALL 2003
COPYRIGHT © 2003 MICHAEL I. SHAMOS
Data Mining Tools• Visualization (“seeing” the data) Table Lens• Predictive Modeling• Database Segmentation
– Classify the users
• Link Analysis– Association discovery
• Neural networks– Systems that learn from data
• Deviation Detection– Are any of the data unusual? Fraud detection
• Elective course: Data Mining (20-852)
20-751 ECOMMERCE TECHNOLOGY
FALL 2003
COPYRIGHT © 2003 MICHAEL I. SHAMOS
Privacy Technology
• Digital privacy & privacy threats• Technology
– P3P– EPAL
• Anonymity– Mediation– Digital pseudonyms
20-751 ECOMMERCE TECHNOLOGY
FALL 2003
COPYRIGHT © 2003 MICHAEL I. SHAMOS
ERP (Enterprise Resource Planning) & SCM (Supply Chain Management)
• The supply network• Collaboration models
– Vendor-managed inventory– Scan-based trading
• ERP functions and architecture• EAI (Enterprise Application Integration)• Web Services
• Required course: Supply Chain Management 46-866
20-751 ECOMMERCE TECHNOLOGY
FALL 2003
COPYRIGHT © 2003 MICHAEL I. SHAMOS
Agents and Electronic Negotiation
Programs to perform tasks on your behalf• Avatars (characters in human form) • Metasearchers, shopping bots, news agents, stock
agents, auction bots, bank bots• How to make agents “intelligent”
– Rule-based systems– Knowledge representation
• Agents that learn– Inductive inference
JULIA from CONVERSIVE
Cooperating Agents
Semantic Web
Lucy’s agent retrieves informationabout Mom’s prescribed treatment
from the doctor’s agent.
Lucy’s agent looks up providers,checks for distance, authorization
and rating.Schedule a treatment plan using only authorized providers within a 20-milesand a rating of excellent or very good.
Lucy’s agent formulates a schedule of appointments for therapists thatfits into Pete and Lucy’s schedule.
SOURCE: WILLIAM HOLMES, LOCKHEED-MARTIN
Pete
Lucy
Doctor
20-751 ECOMMERCE TECHNOLOGY
FALL 2003
COPYRIGHT © 2003 MICHAEL I. SHAMOS
M2M Commerce & Auction Models
• How can machines do business with other machines?• Electronic discovery• Electronic negotiation
– Auction strategy• The semantic Web
• Two elective courses:– Intelligent agents (Katia Sycara) 20-854– Electronic Negotiation (Tuomas Sandholm) 20-853
20-751 ECOMMERCE TECHNOLOGY
FALL 2003
COPYRIGHT © 2003 MICHAEL I. SHAMOS
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