In order to gain further software development experience during postgraduate studies, contact was made contact with the Chester University careers department and a placement organised. A placement was allocated with a free lance web developer. The project allocated by the web developer consisted of developing a social shopping website to a minimum viable product (MVP) level. Some of the pre requisites of the website were to integrate Facebook, Twitter and real time messaging. It was intended that the website offered bulk buy discounts which customers can group together and buy. The social media integrated within the website intended to give users the ability to discuss and encourage others to add the product to their shopping cart. When the required amount of customers added the product to their cart, meeting the discount criteria, the product value was then debited and an order is placed through the website to the retailers. If a product was not available on the website a wish list could be utilised customer notified when the item became available on the website. This concept was similar to other group buying websites such as Groupon and TipToken. However instead of daily deals been offered, customers could choose the products they want.
This report aims not discuss technical development of the placement project, but the considerations that should be taken into account in developing such a system. An information system is described by (Beynon-Davies, 2002, p. 4) as
“… a system of communication between people. Information systems are systems involved in the gathering, processing, distribution and use of information. Information systems support human activity systems.”
A comparison of the placement project description and Beynon-Davies description of an information system strongly indicates that the placement project was an information system development project. To successfully meet the objectives of the work placement by developing an effective information system, the informatics model described by (Beynon-Davies, 2002, p. 3) would be used as a reference template. Figure 1.1
Figure 1.1 The Informatics Model. Taken from (Beynon-Davies, 2002, p. 3)
Three key factors influencing the development of such an Information System will be focused on during the report (Retailers, customers and Social media). In addition to this the direction that ecommerce could potentially take over the next three to five years was discussed. This discussion was based on the views and opinions of professionals within the field of ecommerce and payment gateways, made during a technology seminar at the Daresbury Science and Innovation Campus during December 2010.
It would be fair to say that a number of retailers have realised the advantages available in ecommerce over the last decade, twenty four hour consumer access and being able to extend business activities globally, rather than being restricted by geographical location being but some of the advantages (Kendall, 1992). Retailers can also benefit from adopting ecommerce through increased trade, and improvement/ transformation of their business processes (Office for National Statistics, 2008). The advantages of product purchasing, research and comparison that ecommerce can bring from any location with an internet connection has also been embraced by consumers (Chan, Lee, Dillon, & Chang, 2001). During 2010 an estimated £100 billion pounds worth of sales accounting for 7.2% of the United Kingdoms (UK) gross domestic product (British Broadcasting Corporation, 2010) was through ecommerce. Data gathered by (Interactive Retail Media Group, 2010) also identified an estimated online sales growth rate of 13% during 2010. These figures may be in part influenced by the current economic climate; however it does highlight the current prevalence of ecommerce in the United Kingdom and identifies the market that the new information system would be operating in.
Social media information systems support group human interaction. In the context of this report social media information systems are best defined in text by (Clicky Media, 2010)
“…user-generated content that allows users to share, discuss and participate the conversation. It also allows people or businesses to become both readers and publishers of content. ”
In essence this statement identifies the key role of social media being communication between users. This communication can take a number of forms such as text, images, videos and audio (Clicky Media, 2010). Of a top twenty list of most frequently visited websites for the week ending 08th January 2011 produced by (Hitwise Pty. Ltd., 2011) Facebook, YouTube and Windows live mail were identified within the top 5 with Google in first place. This popularity is not just limited to the United Kingdom but spans the globe, highlight by sources such as (Qualman, 2009). In fact a brief Google search for “Social Media” returns 722,000,000 results comparable with 425,000,000 results for the search term “God”.
During a series of presentations held by Technology, entertainment, design (TED) in Sydney, (Botsman, 2010) discussed the subject of collaborative and sharing through the use of network technologies, how it may change business and consumerism. During the discussion a move from 20th century hyper consumption to 21st century collaborative consumption was identified. Based on personal observations and reflection of social media such as Facebook and Twitter this argument could be considered true. The reasons in part for this recent change in consumption have been identified as pressures from four different sources:
- The renewed belief in community
- A torrent of peer to peer networks and real time technologies
- Pressuring unresolved environmental concerns
- A global recession that has shocked consumer behaviour
List taken and adapted from (Botsman, 2010)
During the speech by (Botsman) three types of collaborative consumption systems were also identified based on a series of case studies:
- Redistribution markets (Reusing items)
- Collaborative life styles (Sharing resources, money and time)
- Product service systems (Paying for benefits of a product without owning it outright)
In a recent research report (Fetherstonhaugh, 2010) argues that businesses/ retailers have not yet fully adapted the new “infosphere” of social media. Traditional face to face high street sales processes are similar to the process identified in figure 1.2.
Figure 1.2 the sales process model. Taken from: (Better Sales and Selling, 2009)
(Fetherstonhaugh) suggested a six point guide for businesses/ retailers as a guide to changing their business/ sales models:
- Adapt to the new buyer journey
- Use online content as digital bait
- Develop new listening skills (digital footprints)
- Future proof marketing skills with behavioural economics
- Learn a new way to sell: Social selling
- Sales and marketing as partners not opponents
List taken and adapted from (Fetherstonhaugh, 2010)
Featherstonhaugh identified a new framework within the report for businesses/ retailers to incorporate, based on the six point guide. See figure 1.3.
Figure 1.3 taken from (Fetherstonhaugh, Speed Summary | OgilvyOne Report on The Future of [Social] Selling, 2010)
These two arguments suggest that there was a shift in consumer consumption taking place during the writing of this report. Businesses and retailers were in a process of adapting to the changes in consumer orientation; however they still needed to adapt their information systems and business/ sales models on order to take advantage of the opportunities presented.
The development of an information system to meet the criteria of the assigned placement project should take the above discussions into consideration. This would ensure current and relevant issues from professionals within the field of social media and ecommerce are taken into account during the information system development. Since the orientation of consumer consumption is arguably still taking place, an information system addressing the issues highlighted by Fetherstonhaugh’s guide would produce a level of future proofing, assuming that the consumer orientation continues to follow the same direction.
There are various system analysis and design methods and techniques which could be incorporated into the development of the new placement information system. During a recent literature review of two articles sourced from “Information system journal”, Work by (Chiasson, Germonprez, & Mathiassen, 2008) entitled “Pluralist action research: a review of the information systems literature” discussed an exploration and findings into how Information Systems researchers practice action research (AR), through the review of a sample of journal articles published between 1982 and 2005. The second article by (Cordoba, 2008) entitled “Critical reflection in planning information systems: a contribution from critical systems thinking”. Presented, tested and drew conclusions on a framework for information system planning based on inspiration from Critical System Thinking (CST). CST takes critical awareness, emancipation and methodical pluralism into consideration during the development of social systems.
Both articles made use of literature resources in order to support their arguments. The articles argued that a mixed approach to information system development was a valid method. This is further supported in work by (Moon & Moon, 2004). However the articles did have different approaches in coming to this conclusion. Since both articles were credible, supported by a wide variety of references and case studies it would be reasonable to conclude that either approach could be used. On reflection the correct method should be based on the scenario and context of the information system. During further reading (Dennis, Wixom, & Roth, 2006) discussed Rapid Application Development (RAD). RAD was a system development methodology established in the 1990’s to overcome limitations experienced in structured design methodology (Dennis, Wixom, & Roth, 2006, p. 12). This methodology was identified as being suitable for the development of the work placement information system, due to the sometimes unclear expectations of requirements (must have and would like features) whilst taking into account the development time frame. See figure 1.4 for a comparison of development methodologies.
Figure 1.4 taken from (Dennis, Wixom, & Roth, 2006, p. 18)
The form of RAD suggested to the placement sponsor was prototyping, this iterative development technique focuses on key must have features first, with the development of would like features during later iterations and feedback. Figure 1.5
Figure 1.5 taken from (Dennis, Wixom, & Roth, 2006, p. 14)
The work placement sponsor was open to the suggestion of development methodology. Due to the social nature of the information system being developed, a mixed approach was suggested taking into account CST discussed by (Cordoba, 2008). In particular the opinions and awareness of the information system users were taken into account. A blog developed by (Court & Georgeson, 2011) along with notifications produced using social networks were used in order to encourage feedback and discussion in order to determine customer understanding of the proposed information system under development.
Further discussions were held in development meetings with the workplace sponsor. A major concern identified and discussed was data security and how to safely handle/ store electronic customer data, in particular sale transaction data. This concern had to be addressed and the solution incorporated into the proposed information system infrastructure from the outset.
Hugh Jenkins (Enterprise marketing director for Dell UK) discussed the subject of electronic data laws and their impact on information system infrastructure in an online article for (BCS, 2011). Hugh Jenkins acknowledged that UK businesses can find electronic data laws and their legal requirements a “… challenging and expensive task” and that businesses and organisations based in the UK must ensure all trade, transaction and accounting data is accountable for auditing purposes. Some of the data handling laws currently governing UK based business are listed below:
- FE Strategic Review
- Data Protection Act 1998
- Freedom of Information Act 2000
- Intellectual Property Rights (Copyright)
- Electronic Communications Act
- Regulation of Investigatory Powers Act
- The Electronic Commerce Directive
- Sarbanes Oxley Act
- International Financial Reporting Standards
- Basel II
List taken from (In-Form Consult, 2004)
The ramification of this was described as business IT infrastructure must now be able to store data over long periods, keep it secure in its original format and be easily recoverable. Failure in doing so can result in litigation and criminal penalties. Data can have a high value to criminals through fraud. This was highlighted in a BBC news report (British Broadcasting Corporation, 2007) where two computer discs containing unencrypted details of 25 million people from the child benefit database were lost in transit between HM Revenue and Customs and the National Audit Office. The estimated value of the data to criminals was £1.5 billion. Based on the results of Dell UK’s research Hugh Jenkins stated that one tenth of annual technology budgets in UK businesses were spent on legislation compliance during 2006.
It can clearly be seen based on Hugh Jenkins comments to BCS that the implications of electronic data laws can be major concern for all UK businesses. After a period of reflection of possible solutions within the development of the work placement information system, it was concluded that the integration of existing industry recognised and compliant information systems would be a practical secure solution addressing the problem of data security. Implementing Amazon web services for storing databases would ensure a stable, scalable and secure (ISO 2700 certified) data storage service (Amazon Web Services, 2010). Another suggestion made was to implement the PayPal third party payment gateway service for handling and storing customer transaction data through use of an Application Programming Interface (API). The way in which the API is incorporated into an information system does depend on the information system requirements; however the overall generic process is identified in figure 1.6.
Figure 1.6 Image taken from: (Web Merchant Services Ltd, 1997)
The proposed suggestions for handling and storing sensitive electronic data was agreed on as being suitable, lower risk solution for the proposed information system by the work placement sponsor, compared with the alternative of developing an “in house solution” taking liability for any instances of data security breaches.
In addition to managing the work placement information system development considerations already identified within this report three, other management considerations also needed to be addressed.
- Information management – General planning, regulation and coordination of information policies within the organisation
- Information systems management – Planning, execution and operation of information handling applications
- Information Technology management – Maintenance of the organisation infrastructure
List Taken and adapted from (Beynon-Davies, 2002, p. 433)
In essence information management can be described as the ability to capture, manage, preserve, store and deliver the right information to the right individuals at the right time (Association for Information and Image Management, 2010).
The work placement undertaken would be considered as a small start up business. The three forms of management relevant to informatics identified by (Beynon-Davies, 2002, p. 432) had not been considered to any great extent. The placement sponsor was approached and the following recommendations were made:
To develop and implement a strategy for identifying and organising key data elements used within the business and the relationships between the data.
Information Systems Management
To develop and implement a business policy outlining how information collection, storage, dissemination and use will take place within the business.
Information Technology Management
To develop and implement a framework for maintenance of the existing information system and development of new software and additional infrastructure that supports the business information system.
Benefits of adhering to the proposed suggestions through all levels of the business from directors to employees would be acknowledging and retaining relevant information as a corporate asset. Identifying and organising information by business and department need, making the information available to the relevant individuals, development of an information organisation, retention and archiving. Recognising these benefits would aid in the development of a business continuity policy (Association for Information and Image Management, 2010). Potential problems that may arise from ignoring the suggestions could be, decentralisation of data within the business, leading to increased chances of data loss and misplacement. Poor data storage and archiving policies leading to lowered business efficiency and being unable to successfully comply with auditing and electronic data laws discussed earlier within the report.
During the work placement an opportunity arose to attend a conference from professionals within the ecommerce industry. The presentations were held at the Daresbury technology and innovation centre on the 13th December 2010 organised on the behalf of Techelerate (Ranaweera, 2010). The presentations were considered as an excellent opportunity to gain further understanding about the direction that ecommerce information systems were viewed as potentially taking over the next 3-5 years.
Three representatives from the mobile phone and payment gateway fraternities were sourced to take part in the presentations:
- Keith Curran – Yes Telecom (sold to Vodafone)
- John Lunn – PayPal, Head of Platform and Integration
- Paul Johnson – Founder & CEO – MPP Global Solutions
Each presenter “cloud” and identified the current influence and power of smart phones such as the Apple I phone, Blackberry and Google Android phones in modern society. These points coupled with John Lunn’s interesting examples of PayPal concept systems, did indeed make a very compelling argument for the eventual decline of the wallets in our pocket. John Lunn also gave the example of a trial PayPal system in the United States of America that allowed customers to purchase Costa Coffee via mobile phones. John Lunn discussed a recent PayPal survey to highlight the impact of mobile technology information systems on society, the question was posed “If you had to leave your house for 24 hours and could only take one of these three items (wallet, keys or mobile phone) which item would you take?” 60% of individuals said they would take the mobile phone.
All presenters supported the argument of the eventual decline and obsolescence of the wallet as we currently know it. However based on example of United Kingdom banking system phasing out the out of the cheque book as an example, this prediction may not happen immediately. This may be because successful management of change requires five key phases to be addressed:
- Awareness of the need to change
- Desire to participate and support the change
- Knowledge of how to change (and what the change looks like)
- Ability to implement the change on a day-to-day basis
- Reinforcement to keep the change in place
List taken from (Change Management Learning Center, 2007)
The five phases identified are based on the ADKAR model published by Prosci in 1999. Figure 1.7
Figure 1.7 Taken from (Change Management Learning Center, 2007)
It is suggested that based on the principle of the ADKAR model that change can take place in two dimensions. The business dimension and the people dimension. Successful change requires simultaneous change to take place in both dimensions (Change Management Learning Center, 2007). Figure 1.8
Figure 1.8 Taken from (Change Management Learning Center, 2007)
The guest speakers however predicted that around 60% of all mobile phone users would be using smart phones within the next two years, equating to 3-5 years in their opinion before the wallet becomes obsolete.
The guest speakers envisaged that large retailers such as Tesco’s, Marks & Spencer’s and Sainsbury’s may start their own banks (they have all currently branched out into finance and insurance (Tesco Personal Finance plc, 2010) ). It was suggested that customers wages could be paid directly to the afore mentioned banks, a widget on a smart phone could then be used to purchase food, clothes, entertainment and of course shopping which could be delivered to the home. An interesting concept and one that doesn’t seem to be outside the realms of possibility the technology exists and many of the information systems required are already in place. An example of this would be that some smart phones have the ability to read barcodes and search the internet for item descriptions. One of the large retailers mentioned (Tesco) has already used its databases alongside a publically available mobile phone application to add items to an online shopping cart. This service is currently being marketed on UK television.
On reflection it seems as though the people dimension and the five key phases identified as an influencing factor within the ADKAR model may be in part a reason that consumers have not yet fully embraced mobile ecommerce. (Botsman, 2010) And (Fetherstonhaugh, 2010) both suggest there may be a shift taking place during the writing of this report from high street retailers to collaborative ecommerce. Mobile ecommerce could be viewed as the next phase of evolution from this point however it may take a period of time before consumers adapt to the new changes within the information systems. All presenters at the Techelerate conference admitted that consumers trust in mobile security was a contributing factor to the delay in the changes, and that finding a balance between ease of use and security was currently an point of discussion in the mobile payment industry.
The report was based on a work placement organise through the University of Chester careers department. The placement consisted of planning and developing an information system that facilitated human interaction in order to the goal of group purchasing products at a discounted price. In order to meet the placement objectives research was undertaken into understanding the current environment the information system would be placed in. Three external factors that would directly influence the information system (Retailers, customers and Social media) were identified and researched. An informatics model identified by (Beynon-Davies, 2002, p. 12) was used a template to base the information system development around. A selection of views and opinions were taken into consideration for determining the appropriate methods to apply in the information system development. RAD in the form of prototyping and CST were chosen as the most appropriate methods of development. Electronic data laws were considered as a potential issue surrounding the systems development and a solution to this problem was found in the form of integrating API’s and secure data storage solutions into the system to handle sensitive data. Information management was also taken into consideration and a set of recommendations were made to the placement sponsor, highlighting potential benefits and possible repercussions of not taking appropriate courses of action. An opportunity arose to attend a conference in which industry professionals were discussing ecommerce and the potential future of mobile commerce and how it may take place. A hesitation in consumer acceptance was identified during the presentations. This consumer hesitance was compared with the ADKAR model to better understand possible causes.
Through out the work placement project, observation and research into current issues governing human activity aided in placing the analysis and development of the information system into a more informed context. This allowed for an appropriate development method to be identified and applied to the information system. (Chiasson, Germonprez, & Mathiassen, 2008) and (Cordoba, 2008) both presented arguments for mixed method approaches in information system development. The facts presented within their discussions facilitated the development of a mixed method approach using RAD and CST to be appropriately applied to the information system. The information system was under development using the mixed method approach during the writing of this report. Feedback from key stakeholders suggested the development methodology was meeting the requirements of the project and they were please with the progression of the project. Through researching a wide selection of sources, a shift in consumer orientation was identified from ecommerce to collaborative consumer ecommerce. This is supported by arguments presented by (Botsman, 2010) and (Fetherstonhaugh, 2010). Based on discussions form the “Wallet in the cloud conference” organised through (Ranaweera, 2010) the direction that mobile payment information systems may take in the future was discussed. However an element of reluctance by consumers to embrace the technology was identified, possibly due to the five key phases of ADKAR model not being fully realised by consumers.