The report is based on the assumption that the company is a budget airline which has online booking facilities and a call centre, these being the basic requirements for this type of organisation. There are various elements that can be seen as contributing to profitability and competitiveness in the e-business paradigm. For example, the company should inspire confidence from the supplier to the customer, be more easily available than would be possible in the physical world, and have the ability to protect data integrity in order to ensure future growth.
There are various ways in which these objectives can be achieved. For instance using the e-business model removes ticket and travel agencies from the chain of supply, which enables the company to create a direct personal link with the customer. Selling directly to the customer in this way means that profitability can be increased: at the same time the price to the customer can be reduced, thereby increasing competitiveness in the market as a whole.
Overheads are also reduced, thus increasing efficiency and providing a faster service response. However, this does not mean that the e-commerce model is automatically superior to any other, since it introduces additional overheads and concerns which must be addressed regarding security and customer confidence. Reduced prices and quicker response time will obviously be severely undermined if security issues mean that customers do not have confidence that their transactions will be safe, and this is an increasing concern as more and more businesses adopt the e-commerce model, with concomitant reports of security breaches in their technological systems.
Customer confidence is the foundation of business survival and should therefore be seen as paramount. When looking at security issues in terms of coding for the system, as Simes (2003) points out, one must follow the principle of...