1014 The Role of Web Sites and E-Commerce in the Development of Global Start-Ups The ability to differentiate the network opera- tors’ product offering, for example the incorpora- tion of e-mail facilities and second secure message facilities for secure contacts, will relative to the downloadable version also allow a premium price. End user pricing of the network provider is expected to be in the range of £9 to £12 a year. As well as repeat business for the network operators each time a user upgrades a phone the software application will generate considerable new revenue streams. It is also anticipated that the software, with time phased licence agreements and enhanced product differentiation, will enable network operators to increase their market share through regional exclusivity rights and to further LQFUHDVHUHYHQXH7DEOHVXPPDULVHVWKHSUR¿OH and background of the company. Development of the Web Site and E-Commerce MPS is offering the application for sale globally to customers through main Internet download Web sites for compatible mobile phones. This was FRQVLGHUHGLPSRUWDQWLQWKH¿UP¶VPDUNHWLQJDQG e-business strategy. The world wide market for mobile phones is over 800 million phone sales a year and the sequential licensing of software to phone providers and network operators will enable MPS to target markets with high growth rates. MPS has appointed legal experts to provide advice on patents since it recognises the importance of patent protection in all the major regional markets. In countries not covered by the International Pat- ent Cooperation Treaty network operators will be offered the software under licence to avoid delay that may result in infringements. The software source code has been encrypted to make piracy GLI¿FXOW7KHWUHQGWRVXSSRUWUHDOWLPHVKDULQJRI information using mobile devices involves many sectors and the software application’s ability to keep data secure will enable new public and private sector applications. On the basis of dual strategy and analysis of project payback, MPS can gener- ate a payback fundamental of between ten times the project cost for Internet sales and a potential 57 times for a licensed agreement with a major network operator. The network operators, through the creation of new revenue streams, should be attracted to incorporate and invest in their mobile devices for the new technology. Web Site and E-Commerce Support The main target markets are the data security product/service markets. Although the launch of the Web site will provide information on the software application for global markets there is a need to be careful not to mislead competitors with how the software is being developed. It is planned for there to be a product comparison on the Web site, comparing the product with competi- 7DEOH3UR¿OHDQGEDFNJURXQGPRELOHSKRQHVHFXULW\ 7DEOH3UR¿OHDQGEDFNJURXQG²mobile phone security %ULHIRYHUYLHZRIWKH¿UP¶VDFWLYLWLHVLWVPLVVLRQDQGIRFXV Industry Data security industry Technology Mobile phone technology Product/service Application software Market and targeted customers Global Company’s current mission and focus To develop the company in the data security industry over the next three years. 1015 The Role of Web Sites and E-Commerce in the Development of Global Start-Ups tors, but this will have to wait for the patent to be approved. The University School of Computing developed the company Web site, which is con- sidered to be exceptional and better than those of the competitors. The role played by the Internet and the Web site, in relation to competitors, will have particular importance in terms of revenue, SUR¿WQXPEHUV RI VWDII DQG FXVWRPHUV $JDLQ the company is moving from step 3 to step 4 of the e-commerce ladder. Pet Care 3UR¿OHDQG%DFNJURXQGWRWKH Company’s Web Site and E-Commerce Development The founder started-up as an incorporated com- pany in May 2004, using Spinout programme public support, with a new product that needed development following considerable research into the market. When the company was at the early development stage, there was a need for a manu- I D F W X U H U,W Z D V G L I ¿F X O W W R ¿ Q G H D UO \ V W D J H V X S S R U W since contacts were reluctant to provide backing and were cautious. The original idea arose from outside the University from a company formed by the founder in 1986. This produced waterbeds for pets and a cage system as a holding bay for animals before and after hospital. Collaborative work originally took place with another University. The bed, for use in animal hospitals, was new on WKHPDUNHWDQGZLWKWKLVSURGXFWLWZDVWKH¿UVW time the founder had started a company. From the experience of doing this the founder decided to start a company again. :LWKWKHSUHVHQWFRPSDQ\WKH¿UVWSURGXFWLV an outside cat cabin, which is being marketed on the company Web site. This has been developed following the founder’s experience of housing cats while at work. There is a clear demand aris- LQJIURPRZQHUVQRWEHLQJDEOHWRKDYHDFDWÀDS in a wall, or where the cost to replace a door is prohibitive (@ £800 in some cases). From this the idea for a cat cabin arose. Table 5 summarises the SUR¿OHDQGEDFNJURXQGRIWKHFRPSDQ\ Development of the Web Site and E-Commerce ,QWKH¿UVW\HDUWKHFRPSDQ\FRQFHQWUDWHGRQWKH UK and Irish markets. Since this was a challenge, it was decided to concentrate on one product. In the second year the company sold into the European, United States, and Chinese markets. The Chinese market is a large window of opportunity since the majority of homes have a cat and therefore there is an immense market. Since the cat house is a unique shape representing the head of cat at the entrance it looks good. It is therefore functional VLQFHWKHFDWKHDG¿WVLQWRWKHJDUGHQDVDSLHFH of furniture and appears as an attractive product to customers on the company Web site. This was taken into account in the overall marketing and e-business strategy. Web Site and E-Commerce Support )RUWKH¿UVW\HDURXWOHWVZHUHHVWDEOLVKHGLQFOXG- ing selling through the company Web site, pet stores, local shops, and large chain stores like Argos in the UK. The founder has also approached other outlets such as mail order catalogues. When a retailer sees a picture of the product they usu- ally want to sell it. This has been the case with a large Irish retailer. There has been a good re- sponse and there appears to be a global market. Once the initial market has been established the company will consider other products in order to diversify and sell internationally. The role being played by the Internet and the company Web site LVKDYLQJDVLJQL¿FDQWLPSDFWRQUHYHQXHSUR¿W and the numbers of customers. Since the company is selling its products through the Web site it is at step 6 of the e-commerce ladder. 1016 The Role of Web Sites and E-Commerce in the Development of Global Start-Ups Under Grad 3UR¿OHDQG%DFNJURXQGWRWKH Company’s Web Site and E-Commerce Development Under Grad is a company, which provides a scheme that encourages companies to employ the best engineering and technology students through the company’s Web site. The co-founders started the company about four years ago in January 2003 with public support through the Spinout programme. The idea for the company arose due to the national decline in the number of students gaining employment in the areas of engineering and technology. Following this being recognised as an opportunity in 2002, a limited company ZDVIRUPHGLQ-DQXDU\2I¿FHVSDFHZDV provided at the University spin-off premises with the help of the Head of the University Commercial Services. The ambition of the founders is to help the University and other universities (like minded RUJDQLVDWLRQVDQGGHSDUWPHQWVWR¿QGLQGXVWULDO employment for their engineering and technology students. The two founders are both employed by the University in the School of Technology and when they formed the company they were WKHWZRGLUHFWRUV2I¿FHVSDFHVXSSRUWVWDIIDQG facilities are provided in the School, as well as the RI¿FHVSDFHDWWKH8QLYHUVLW\VSLQRIISUHPLVHV 7DEOHVXPPDULVHVWKHSUR¿OHDQGEDFNJURXQG of the company. Development of the Web Site and E-Commerce The company was developed within the Uni- YHUVLW\¶V6FKRRORI7HFKQRORJ\7KH¿UPSODFHV undergraduate students at a host company while studying part-time for a degree using the Web site. Two days are spent by trainees at the University and the rest of the week at work. Complex systems have been developed to support the scheme, by a franchise centre, through innovative support systems with the award of the ISO 9000:2000 accreditation of the work. Originally work was aimed at higher education institutions in Britain, EXWIROORZLQJPRGL¿FDWLRQRYHUVHDVFROOHJHVDQG a private European training organisation have become involved. Franchise centres deliver key VNLOOV PRGXOHV DW OHYHO WKURXJK WR ¿YH\HDU supported programmes. The company provides valuable work experience to students during their university course, with no fees and a bursary up WR %XVLQHVVHV EHQH¿W IURP PRWLYDWHG undergraduates studying at university, working 7DEOH3UR¿OHDQGEDFNJURXQGSHWFDUH 7DEOH3UR¿OHDQGEDFNJURXQG²pet care %ULHIRYHUYLHZRIWKH¿UP¶VDFWLYLWLHVLWVPLVVLRQDQGIRFXV Industry Pet products Technology Pet care technologies Product/service Specialised pet care products—cat house, pet bed, and animal warm mattress. Market and targeted customers 8.LQWKH¿UVW \HDU²SHWVXSHUVWRUHVPXOWLSOH UHWDLOHUVSHW shops, privately owned high street outlets, veterinary surgeries. Europe (second year). North American market (third year). Company’s current mission and focus Through the development and sale of pet products, the company will establish itself in the UK market and progress to the European and United States markets. 1017 The Role of Web Sites and E-Commerce in the Development of Global Start-Ups with the businesses, and they become competent and experienced company members. Franchise centres are cost effective. These have been very successful and have helped to reverse trends in GHFOLQLQJQXPEHUV DQG HQWU\ TXDOL¿FDWLRQV IRU engineering and technology students. There have also been follow-on efforts such as the retention of students. Through students being more aware of potential debt, and the incentive of a bursary and work experience they are attracted to the scheme. Web Site and E-Commerce Support Flexibility is a key factor and franchises are avail- able for fees and maintenance fees with three levels of participation. Level 1, which is the placement class, is the entry level developed for overseas partners. The company provides the means to develop industrial contacts for customers through its Web site and many businesses are willing to have students on short placements. This was taken into account in the overall and e-business strategy. A matching section of the company Web site provides a means to do this. Level 2 involves an innovative student attendance monitoring system. An essential element of the programme is to develop a mature student attitude towards their work and studies. Level 3 is full member- ship and includes the two previous classes plus a full package providing the franchise centre with training and support to develop a network of com- panies and students. Documentation is provided to support the running of the programme with the required resources. On the technical side, the company has developed its own Web site. This is found to be a necessity when recruiting French students, since this is undertaken online on the Internet. The Web site is, therefore, seen as an important international tool in terms of revenue, SUR¿WDQGFXVWRPHUV7KHFRPSDQ\LVDWVWHS of the e-commerce ladder. FUTURE TRENDS The key results, evidence, and experience from the empirical case study research highlight clear and precise reasons for the development of Web sites and e-commerce by the global start-ups. The limitations of the results are that in most of the cases they report early stage development of Web sites and e-commerce. Table 7 summarises the results of the global start-up case studies in terms of their step on the e-commerce stairway. Table 7 illustrates that the vendors of goods (LBP, MPS, and pet care) are on a higher step of e-commerce than the vendors of services (CS, 7DEOH3UR¿OHDQGEDFNJURXQGXQGHUJUDG 7DEOH3UR¿OHDQGEDFNJURXQG²under grad %ULHIRYHUYLHZRIWKH¿UP¶VDFWLYLWLHVLWVPLVVLRQDQGIRFXV Industry Employment Technology Student employment systems Product/service Employment service for companies to employ engineering and technology students. Market and targeted customers • Engineering and technology students • Companies • Universities Company’s current mission and focus To maintain and consolidate company activities in the employment of engineering and technology students over the QH[W¿YH\HDUV 1018 The Role of Web Sites and E-Commerce in the Development of Global Start-Ups EMS, and UG) over the Internet. Indeed, pet care, founded in 2004, has reached stairway level 6, while LBP and MPS, established contempo- raneously or before, have only reached levels 3 or 4 due to Pet Care developing the sale of its products through its Web site further than LBP and MPS. Since most of the global start-up companies are fairly young they have tended to report early stage development in terms of e-commerce. It is, therefore, planned to undertake follow-up inter- views in future years to develop a longitudinal study to reveal e-commerce developments. In order to do this a coherent structure for both the data and the analysis will be essential. CONCLUSION: THE E-COMMERCE STAIRWAY In the future, more entrepreneurs will gain access to the Internet at lower cost, but if concerns such as security are not addressed e-commerce may be slow to grow. If more secure ways of business are developed on the Internet, consumers and businesses will not consider themselves vulner- able with personal information. The number of SMEs using computers in their operations will increase considerably in the future. In particu- lar, the Internet is a quick and simple means of communication between SMEs and customers. Consequently, more companies in the future will be likely to use e-commerce. SMEs will be able to buy, sell, distribute, maintain products, and provide services over the Internet. This is shown by the global start-up case studies. By doing this, they will be able to achieve cost savings and have more customers with increased sales. Here, e-commerce will not replace traditional forms of shopping and business, but will provide a further option to the SME and the consumer. Business- to-consumer (b2c) development has been slower than business-to-business (b2b) e-commerce. For continued growth in online consumer sales there is a need for secure and cost effective mechanisms. Future consumers are likely to embrace e-com- merce in greater numbers than at present and this will help the development of e-commerce for SMEs. This chapter has revealed the important role of Web sites and e-commerce in the development of global start-ups. Although they are, in many cases, at an early stage of development the case studies show a critical need for e-commerce to develop international activities. In response to this the e-commerce stairway illustrates how a global start-up can progress up the steps of e- commerce activity. It appears that global start-ups adopt a proac- WLYHDSSURDFKWRHFRPPHUFHLQRUGHUWREHQH¿W from this medium. As they develop they need to keep pace with electronic developments as the international e-economy gathers momentum. Table 7. Steps for the global start-up companies on the e-commerce stairway Table 7. Steps for the global start-up companies on the e-commerce stairway Case Company Initials Step 1. Consultancy Services CS 3 2. Energy Management Systems EMS 3 3. Literary Book Publishing LBP 3-4 4. Mobile Phone Security MPS 3-4 5. Pet Care PC 6 6 Under Grad UG 3 1019 The Role of Web Sites and E-Commerce in the Development of Global Start-Ups There are therefore important implications of the e-commerce stairway for entrepreneurs, policy makers, practitioners, researchers and educators IRUWKHVSHFL¿F¿HOGRIHFRPPHUFHGHYHORSPHQWV for global start-ups. It is therefore apparent, from WKH¿QGLQJVRIWKLVFKDSWHUWKDWEHFDXVHRIWKH increasing importance of SMEs being able to sell their products and services over the internet, it is necessary for regional governments to develop an e-commerce policy, particularly as affects global start-ups, to ensure the future competitiveness of their regions. REFERENCES Arthur Andersen & National Small Business United (1998). Survey of Small and Medium-sized Businesses. Report, November. (pp.19-20). Autio, E., & Sapienza, H. J. (2000). 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Retrieved November 8, 2006, from http://instat.com Wakkee, I., van der Sijde, P., & Kirwan, P. (2003). An empirical exploration of the global startup concept in an entrepreneurship context. Working Paper. Holland: GS Leuven. Williams, V., & Phillips B. D. (1999). E-commerce: Small businesses venture online5HSRUW2I¿FH of Advocacy, US Small Business Administration, Washington, DC. Retrieved July 1, 2006, from http://www.sba.gov/advo/stats/e_comm.pdf <DQ NHH*URXS<*<DQNHH*URXS¿QGV small and business market missing the Internet FRPPHUFHRSSRUWXQLW\0DUNHW8QVDWLV¿HGZLWK current Internet solution provider offerings, YG Communication, November 17. Retrieved from http://www.yankeegroup.com Zahira, S. A., Ireland, R. D., & Hitt, M. A. (2000). ,QWHUQDWLRQDOH[SDQVLRQE\QHZ¿UPV,QWHUQD- tional diversity, mode of entry, technological learning and performance. Academy of Manage- ment Journal, 43(5), 925-950. KEY TERMS E-Commerce: Buying and selling of goods and services over the Internet. E-Commerce Stairway: The step of e-com- merce an SME is on from a state of no e-commerce activity to a situation of advanced e-commerce trading. Entrepreneurial Orientation (EO): The extent to which enterprises are willing to take risks, compete with other enterprises and engage in innovation and change. Global Start-Ups: Enterprises which from their creation seek to exploit markets in other countries. High Tech Businesses: Businesses which develop new technologies. International Entrepreneurship (IE): Tak- ing business opportunities in other countries involving innovation and risk taking. Online Entrepreneurs: Entrepreneurs who run their business over the Internet through a Web site. Technological Innovativeness: The extent WRZKLFKVLJQL¿FDQWWHFKQRORJLHVDUHFUHDWHGE\ an enterprise. This work was previously published in Information Technology Entrepreneurship and Innovation, edited by F. Zhao, pp. 101- 121, copyright 2008 by Information Science Reference (an imprint of IGI Global). 1023 Copyright © 2009, IGI Global, distributing in print or electronic forms without written permission of IGI Global is prohibited. Chapter 4.3 Open Source LMS for Management and E-Business Applications Beatrice A. Boateng Ohio University, USA Kwasi Boateng Ohio University, USA BACKGROUND Advances in computer technology have led to the increase in the use of information technology in business (Barron, 2002). Computer-mediated communication in the form of the Internet of- fers unprecedented avenues for the exchange of information and the delivery of instructional materials globally and locally (NHDP, 2003; Robey, Boudreau, & Rose, 2000). Through the Internet and related technologies, people are able to acquire skills and knowledge, adapt learning experiences to their own needs, and assimilate information faster (Azad, Erdem, & Saleem, 1999; NHDP). An organization that is making use of such e- technologies for the advancement of e-business is the Advance Information Technology Institute’s .R¿$QQDQ&HQWHURI([FHOOHQFHIRU&RPPXQLFD- tions and Information Technology (AITI-KACE), established in 2003 in Ghana. The center is a col- laborative initiative between Ghana and India, and is aimed at bridging the gap between education and industry. This initiative was in response to Ghana’s recognition of the social and economic EHQH¿WVRILQIRUPDWLRQDQGFRPPXQLFDWLRQVWHFK- n o l o g i e s . T h e c e n t e r i s c o n s i d e r e d p a r t o f a n a t i o n a l initiative to educate Ghanaians and unleash their creative potential in the use of digital communica- tion technologies for business and education. It is a major skills-development and training institu- tion whose graduates can transition into industry immediately as employees or employers. Ghana’s main challenge is that computer education at all levels is inadequate, and businesses are struggling to incorporate computer applications in their operations. Despite the relative advances made in the adoption of e-technologies in businesses . readiness of small and medium sized enterprises: Approaches and met- rics. Internet Research: Electronic Networking Applications and Policy, 12(2), 139-164. 1020 The Role of Web Sites and E-Commerce. engineering and technology students. Market and targeted customers • Engineering and technology students • Companies • Universities Company’s current mission and focus To maintain and consolidate. debt, and the incentive of a bursary and work experience they are attracted to the scheme. Web Site and E-Commerce Support Flexibility is a key factor and franchises are avail- able for fees and