A Framework for E-Business Quality Modeling Based on Process Interaction

Qin Sul, Zhao Li', Shan Chen'

School of Management, State Key Laboratory for Manufacturing System Engineering, Xi'an Jiaotong University, Xi'an, 7 10049 China

School of Business Administration, North China Electric Power University, Beijing, 102206 China { qinsu@mail.xjtu.edu.cn, lizhao@mailst.xjtu.edu.cn}, * shansmile@ 12cj.com

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Abstract- Among the factors that block e-business' development, quality of e-business is a critical problem to be resolved. Scientific quality modeling of e-business is important to improvement of e-business. Compared with traditional business, the shift of business interaction manner is the essential character of e-business. Constructing interaction model of e-business transaction process and then making quality analysis is a good way to improve the quality of e-business. In this paper we will develop a framework to deriving customer perceived quality model of e-business, which is based on the dynamic interaction process of e-business transaction,

Keywordr: e-business; quality modeling; dynamic interaction

I. INTRODUCTION As a new business mode, e-business developed very

rapidly with the evolution of Internet technology and network construction in recent years. But China's e-business development is relatively underdeveloped compared with the developed country, both in theory research and practice. Seen from statistic data, only less than 2% web users do business directly with Intemet, such as web shopping and stock exchanging, in China"'. Among the factors that block e-business' advance in China, such as consumption tradition, the construction of credit system and logistics system, the quality of e-business transaction process is the vital problem to be resolved. To improve the e-business process quality, it needs expert knowledge from quaIity management, service management, marketing and web technology, and it must be implemented using systematic method. Foremost, scientific quality modeling of e-business can help t? understand what constitutes a high-quality e-business system and to provide useful instruction for improving quality of e-business. Various quality modeIs have been deveIoped on prior researches; i.e. models based on the website evaluation (Webqual?, SITEQualL3') and total quality model implementing TQM

Compared with traditional business, the shift of business interaction manner is the essential character of e-business. To complete a transaction online, business actors need to dynamically interact with each other several times and in multimode. Such interactions can be both virtual acts (e.g. information communication) and materia1 exchanges (such

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This research was supported by the National Natural Science Foundation of China under G m t Nos.70472037 and 70072023.

as delivery of products or transfer of money). The quality factors, which influence the dynamic interaction process, are of critically important for assuring the e-business quality. However, few of the existed quality models are based on analysis of dynamic interaction in e-business transaction. Constructing interaction model of e-business transaction process and then applying quality analysis is a good way to improve the quality of e-business. In this paper, we will develop a framework to deriving customer perceived quality model on the analysis of interaction process of e-business transaction. Firstly, we develop a multiphase model for the interaction process of e-business on the base of Business Action Theory (BAT). Then FMEA are applied on the interactions of each phase to get key quality attributes. By analyzing and classifying the quality factors into different quality dimension, we get a multi-dimension e-business quality model.

The rest of this paper is organized as follows: section 2 briefly reviews prior researches on e-business quality. Section 3 introduces the theory basis of our research. The modeling method and results are formulated in section 4. In section 5 , we present conclusions and comment on future work.

11. REVWW OF PRIOR RESEARCHES E-business transaction is performed mainly on business

websites and some other assistant services by different actors. So many former researches focus'on the website quality. Business websites are apt to apply the complicated m-function system of application oriented to satisfy the customers' all kinds of demanding. For that reason, some matured theories and models in IT and software quality domain were adapted to the study of e-business quality, including website hardware efficiency research, and information evaluation theory.

Lam & Matthew (1999) 16] studied the contributing factors about usage of electronic commerce website. They pointed out that speed of webpage upload, security, and efficiency of navigation are the major quality attributes that affect customers.

Jeong & Lambert (1999) ['I made experiment study on quality of website and concluded that the quality of website composed of info veracity, integrality, relativity, legibility, ease of use, and navigation quality. Their study results were

very similar with the results by Miller (1996) in classifying the information quality., Barnes & Vidgen (2000)[9’ studied the quality of four English business colleges’ website, and got a website information quality evaluation model named WEBUAL. This model was revised and improved by many researchers in the following years, and a suit of WEBQUAL model is formed which could evaluate almost all kinds of website quality.

Based on the experience of Technology Acceptance Model (TAM) ‘“I in the field of MIS, many researchers applied TAM to e-business quality studies. Loiacono et aI. (2002)[”] used Theory of Reasoned Action (TRA) and TAM for reference, apply empirical measure by focus group and developed a website quality model WEBQUALlhz with 12 quality dimensions. This study put emphasis on theory basis, and the process is normative and precise. Thus WEBQUALTM is well recognized and applied by many researchers.

In the early 198O’s, the Finnish scholar Gronroos presented the conception of customer perceived quality in the field of service quality study for the first time. Recently some scholars see e-commerce as the extension and revolution of traditional service management. The SERVQUAL “*I put forward by Parasurman is often cited. But more researchers only adopt the concept af perceived quality and reconstruct an e-commerce quality evaluation model, such as Yo0 (2001)‘’31. Seeing e-business as processes of providing service to online customer, Parasuraman, Zeithaml, and Malhotra extend their famous SERVQUAL model in recently years. The new evaluation model adapted to e-business circumstance they got is named E-SERVQUAL’141. In E-SERVQUAL, they still stand on the customer’s view. E-SERVQUAL composed of seven quality dimensions: efficiency, reliability, fulfillment, privacy, responsiveness, compensation, and contact.

Many other researches follow the philosophy of Total Quality Management (TQM), and analyze the key quality characters throughout whole e-business transaction process. They identify the quality dimensions based on the view of making e-business continually improvement. Selz & Schubert (1998) ‘”I analyzed the quality characters of online consumer process from customers’ viewpoint. They divided the total transaction process into information phase, agreement phase, transaction performing phase and after-sale phase. In a further research, Schubert & Dettling (2002) 1161 vertically summed up the quality characters into three dimensions: ease of use, usefulness and trust, using the extend web assessment method (EWAM) as tool. They utilized both horizontally and vertically quality characters to totally evaluate the electronic commerce, From the viewpoint of Internet enterprise operation, Ho and Wu (1999)‘41 and Youlong Zhuang (2003)‘L71 analyzed the traits of web shopping. They proposed models comprises of logistics support, customer service and background efficiency, etc.

As we can see, some researchers focus their studies on the

technical quality of the Website itself while others refer to the service quality provided to customers through the Web site or the whole transaction process. Though these existed various quality models using different methods, most of these models are validated to be fine by empirical studies. This is because there is not common defmition of e-business quality. Different researchers may have various perceptions of it and start their researches from different views. So it’s important to address what e-business quality is at fmt. We think quality of e-business is quality of all cues occurs before, during, and post the &saction, not only including service customers received but also the products and perceived value customers get. For lack of interaction with “live” salesman, online customers are “do by oneselr’ to a great extent. So the quality of e-business largely depends on how effectively online enterprises interact with. its customers and aid customers in completing online transaction. However, few of the existed researches focus on analyzing interaction process of e-business. As viewed from assuring high-quality interaction process of e-business, a new quality modeling method is proposed in following sections.

111. THEORY BASIS AND lMETHOD

A. Business Action Theory (BAT) In people communication studying field, several theories

are presented within a language/action (LJA) tradition; i.e. theories based on speech act theory (Austin, 1962; Searl, 1969) and communicative action theory (Habermas, 1 984)[201. On the base of U A theories, researchers advanced theories and methods especially adapted to business interaction, including Business Action Theory (BAT). Goldkuhl introduced business Action Theory at the middle of 1 9 9 0 ~ ’ ~ ’ ’ ~ ~ ~ ~ . BAT has two main theoretical foundations: communicative action theories and business relationship theories. BAT is a generic business interaction model, which describes the inherent business logic when suppliers’ and customers perform business’ with each other. It makes in-depth study of business transaction process, and divide the transaction process into six generic phases: 1) business prerequisites phase, 2) exposure and contact search phase, 3) contact establishment and proposal phase, 4) contractual phase, 5 ) fulfillment phase, and 6) completion phase. This model emphasizes the importance of dynamic attributes of interaction, There exist interactions almost in all of the phases, mainly include business communications and exchanges of value. BAT holds that business interaction is not restricted to business exchange; it can also influence the relationship between the different business roles, such as satisfaction and customer loyalty.

There are some similar models and methods as Action Workflow approach ‘231 and DEMO approach ‘241. The reason why we select BAT as a starting point of our research is that BAT is more especially adapted to business process and supports the business process modeling and evaluation in web environment, With BAT model, we can understand

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transaction process and business interaction more exactly.

B. Failure Mode and Effect Analysis (FMEA) FMEA is a method of Hazard Analysis. Hazards mean the

situations in which there are actual or potential dangers to people and to environment. Every hazard will bring certain risk, that is the likelihood of hazard event occurring and its consequences [=I. Once the hazards are identified and analyzed, the system can be more reliable with improved quality. By applying FMEA, we can inspect every module and subprocess in the system for various kinds of latent hazards (or called failure modes in FMEA). FMEA firstly considers modules or sub-processes, and tries to identify all the latent failure modes. Then the causes and effects of each failure mode are analyzed in order to adopt corresponding remedy actions to avoid hazards occurring. There are also various hazards existing in the e-business process; i.e., not providing detailed information of goods or not responding to the customers’ demand timely. These latent hazards in e-business may result in abandon of the online transaction. If hazards in e-business are identified, the related quality attributes of e-business system can be modified to avoid the risk, and to improve the total quality and reliability.

IV. THE PROPOSED METHOD FOR EdUSINESS QUALITY MODELING ’

E-business can be divided into several sub-modes, such as B2B, B2C and C2C; and there exist distinctions among different sub-modes. Even in the same sub-mode, transaction process may be changing as providing different type of goods and service, different payment and delivery manner. This paper take a B2C case as example to demonstrate the proposed modeling method, in. which online customers pay for their orders when goods are delivered to them.

Though BAT model adapts io general business transaction process, e-business is different from traditional business mode both in trading manner and interacting sequence. So the BAT model needs to be modified when describing e-business transaction process. When doing business online, the searching and selection of interested goods and negotiation between o n h e enterprises and customers are performed by information communication on Internet. This shift of interaction manner makes e-business more efficient and superior. In order to exactly express the interactions in e-business, we integrate the first three phases of BAT model into one phase named “Information contact phase”. The second phase is “contract establishment”. In this phase, customers have found interested goods information and some other information they want, such as delivery and payment policy, privacy policy, etc. If customer is satisfactory with evaluating these informaiton, he will give an order to the online enterprise and mutual commitment is given to each other also. That is, trade contract is established. Then customer can get back to the first phase to begin mother shopping, or get straight to end this online shopping experience. The next phase is “fulfillment” stage,

in which trade contract will be executed. In this B2C case, online enterprises deliver the ordered goods to customer (or this action maybe done by Third Party Logistics). Customer receives goods, and pay for the order and delivery if the contract is executed as expected. Otherwise, customer can ask supplier to exchange a purchase. The last phase is about services after sales, as named “services after sales” phase, Services after sales are greatly contribute to customer satisfaction and total perceived quality of e-business. It’s of great importance for online enterprise to contact with customers and inquire about their feeling of the online shopping experience. At the same time, customized marketing information is good for customer relationship maintenance and continuity of e-business. Although these last three phases remain the same sequence with BAT model; however, the interactions within each phase are revised according to e-business transaction. We model interactions in ‘the B2C transaction using UML process interaction diagram, see Fig 1.

This interaction model describes not only the inherent business logic when the B2C transaction is performed, but embodies the generic business actions within every phase of B2C. The transaction process is described mainly from two aspects: communicative flow and material exchange. Dealing actions, such as contact, negotiation, establishing contract and order, are accomplished on base of information communication, which are represented by information flow existed in all the phases of the model. But the transaction cannot be fulfilled only by information communication, even in e-business environment. It must include the material acts of delivering goods or services and paying.

Next, we apply FMEA on interactions within each of the above-mentioned phases for quality analysis. For example, there are mainly three interactions in “information contact” phase, namely search for goods information, search for detailed information, and send demand information to online enterprise. Customers cannot find detailed information is a hazard. It may cause customer to abandon the online shopping. This hazard may result from the incomplete Wormation provided by website. To avoid that happening, online enterprise should provide abundant detailed information about the goods to satisfy customer’s informatian requirement; or they should check whether information search engine is easy to use and efficient for users. So abundant detailed information and easy-to-use search engine are corresponding quality attributes related to this hazard. By doing that, the critical hazards and their causes in each interaction are identified. The causes of a hazard can be mapped to one or several quality attributes of the B2C process. Hazards will be avoiding when these quality attributes are well treated, and then online transaction process will be accomplished successfully with high customer satisfaction. For the limits of pages, we only take the “search for goods infomation” in “Information contact” phase as a case, see Table 1 :

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Fig. 1. Interaction model of B2C. It addresses the inherent interactive logic of a B2C transaction process. With this model, we can put emphasis on quality ataibutes of each interaction.

NO. Failure mode

Interested goods information cannot be found

Goods information is inaccurate

Technical errors occur

TABLE I : FMEA ON “SEAI Causes

@This goods information is not provided by the website at all @Customers do not know bow find information on the website @Efficient search tools are not provided

0 information e m @information is not up-to-date @information is not reliable @information is not easy to understand

@website can not be opened @webpage load too slowly @webpage linkages error mother technical errors

i FOR OOODS INFC

Local effects

Can not provide customer with interested information

Disturb the information communication between online enterprise and customers

dATl0”’ Effects to BZC

Likely to result in abandoning of online transaction

Likely to result in abandoning of online transaction

Likely to result in abandoning of online transaction

J Abundant information J Communication with

customers Provide o h e help

4 Provide i n f o d o n searching function 4 Reliable system JResponse time

4 Accurate information w‘ Update timely J Easy-bundentand

information 4 A p p m e t e ways to provide loformation

4 Reliable system J High-performance system Short response time

/Few technical errors

Having completed the quality analysis of all the the customers think important in their interactions with interactions respectively, we gather various quality attributes online enterprises, all these quality attributes are of e-business transaction process. For we aim to explore re-comprehended and reword in user’s perception. Then an what iterative process is conducted to synthesizing, and clustering

these attributes, according to their different roles in

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interaction of B2C online shopping process. Such3 process results in five themes pertaining to customers’ perceived B2C quality. The five quality themes are labeled as foIlows: . 1) Efficiency ’

Many customers tend to do e-business for its convenience and for saving time and energy of shopping, They are always purposeful when doing business online. So if the transaction

, process is efficient, customers will get more perceived quality and satisfaction. Efficiency is one of the advantages of e-business compared with traditional business, including ea’y to place an order, convenient to pay for the order, and timely respond to customers’ questions, etc.

2) Purchased gooddservice In essential, what the customers do e-business for is the

goods or service they want. The price, quality, and some other related issues of gooddservice would influence how online customers judge their perceived quality of total e-business transaction.

3) Website quality Website is the main platform on which bargainers interact

and do e-business with each other. Website quality will directly affect total quality of e-business transaction. It’s composed of three components: information quality, system performance, and ease of use. Each of these describes

different aspects of a website requirement when customers do business on it.

4) Security and privacy Security and privacy is a problem which customers are

always seriously concern about. Security pertains to conveying financial information online, privacy means to revealing personal information and dealing records. They are also basic requirements of customers to do business on Internet. This theme comprise of issues as whether it’s safe to do business with website, whether it’s safe to pay for the order, and whether privacy is well protected.

5 ) Reliability In B2C environment, customers can’t get face-to-face

interaction with online enterprises: So online customers seriously care about such issues as whether online enterprises provide goodslservices as description, delivery on time, and take recovery actions when problems arise. Reliability explores how well online enterprises will keep their promises. Reliability is cited to be important factor in e-business quality, for example Woifinbarger and GiIly (2003)[261found that reliable were the strongest predictor of online customer satisfaction and perceived quality.

Finally, we get the quality model of the B2C case discussed in this paper, see Fig. 2.

‘Easy to make a selection among similar gooddservice Easy to place an order Convenient to pay for the order Relatively fast delivery Provide various channels for customer support Can directly contact to employee Customer’s questions are responded quickly. Customer’s complaints are properly recovered timely Returning items is relatively straightforward

Competitive price Having satisfying quality

Provides abundant information Provides accurate information Provides upto-date information Provides understandable information Provides relevant information Provides tailored information Always ready to be connected Tailored communication channel

Provide after service

Reliable website system

Website quality

L Efficient website system

Easy-to-find website Easy-to-learn website Provides efficient search tools

Safe transaction with this website.

Website has adeauate securitv features

c Easy to navigate &ugh the website

I privacy I Private information is pro tech Safe way to pay for order

Correctly processing the order Provides confirm information of orders to online customer On time delivery The received goods is same with description Be sincere in helping customers. Recovery actions are taken timely when problems arise The online enterprise has excellent brand The online enterprise has good reputation

. The online enterprise always does as they promised 1

Fig.2. Quality model of BZC. Using this model can help companies understand, communicate, and share quality aspects of e-business. Further, it can be used as evaluating tools for e-business quality.

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Different with existed ones, this model fully takes into account of quality factors that interrupt customers’ interaction with online enterprises. Prior researches only focus on information interaction when referring to interaction,, such as interaction with website, information responsiveness, and information quality. Wile this model totally explore how and the quality of all the kinds of interactions in SZC. transaction process, including information interaction, goods exchange, capital exchange, and customer service interaction. For example, such issues as cost, quality assurance, after service of the goods exchange is considered in this model. Though e-business interactions are mainly Human-Computer Interaction, interactions with “live” people are absolutely necessarily in some cases. So this model also contains issues as whether such interaction ways are provided and the attitude of contact employee. Further, the influence of online enterprises’ reputation and brand on customers’ perceived quality is addressed in this model. It aims to assure successfully accomplishing online transaction process and enhance the continuity of e-business.

V. CONCLUSION In this paper, we take a B2C case as example to develop

a quality modeling method based on BAT model and FMEA approach. Firstly, BAT model are revised to model interactions in e-business transaction process. Then we apply FMEA on the interaction model to find key quality attributes. Integrating and categorizing these attributes into higher dimensions develop a quality model of B2C.

The proposed modeling method is instructive for assuring and improving quality of e-business process. But whether quality model, developed by the proposed method, can fully address quality aspects of e-business transaction still needs validated in practice. What’s more, validity and reliability are also to be validated, when using the proposed model to evaluating quality of e-business process. In further work, we will implement empirical stud-ies to verify validity of the proposed model.

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