Emerging Modes of Business

NCERT Solution

Short Answer Type

Question 1: State any three differences between e-business and traditional business.

Answer: Following are the three differences between e-business and traditional business:

Formation of a traditional business is difficult, while that of e-business is simple.
Operating cost in a traditional business is very high, while it is very low in case of e-business.
Opportunity of inter-personal touch is high in traditional business, while it is low in e-business.

Question 2: How does outsourcing represent a new mode of business?

Answer: This involves outsourcing mainly non-core business processes to a third party. Outsourcing helps in better focus on core activities; in terms of finances and manpower. It helps in saving of money because processes are done by experts in their field. It also helps in inter-organisational learning. Thus, outsourcing has revealed a new mode of business which is different from traditional mode in which everything was done in-house.

Question 3: Describe briefly any two applications of e-business.

Answer: Following are two applications of e-business:

B2C Commerce: Business to customer commerce is taking place through e-business at a larger scale than ever. This involves a producer selling its product through its own or other’s e-commerce platform.
B2B Commerce: B2B commerce involves business transactions between business organizations. Many business organizations interact with their suppliers and buyers through this mode.

Question 4: What are the ethical concerns involved in outsourcing?

Answer: There are various ethical concerns involved in outsourcing. For example; Nike was embroiled in court cases because its manufacturing facilities in some East Asian nations used child labour. It is important to note that child labour is banned in USA. So, Nike was found to be following unethical practices by allowing child labour in those countries where rules are lax. Similarly, a company may be outsourcing some processes from countries where there could be rampant wage-discrimination on the basis of gender.

Question 5: Describe briefly the data storage and transmission risks in e-business.

Answer: Computer network is all about sharing of data among many computers which may be spread all over the world. While doing transaction in e-business one needs to transmit lots of data. Some data can be highly sensitive; such as credit card information. The data can be stolen and misused by a hacker. This presents a big risk. For example; if someone steals user name and password from your parents’ bank account, he may siphon off all the money. This is a big risk in e-business. However, software developers are coming with new tools to protect sensitive data.