The Implications of an Extranet on the Business Model

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The Implications of an Extranet on the Business Model

(graphics not available) Purpose of the Report

The purpose of this report is to provide the strategic implications of an Extranet on my company's business model over the next three years. It is understood that the present business model utilizes an Intranet system.

Background of the Topic

When discussing Web-based technologies, we need to consider three distinct variations: the Internet, the Intranet and the Extranet.

Internet

The Internet is a public, global network of networks which is based on Internet Protocol (IP) and related standards (http://www.teleshuttle.com/media/extradef.htm). The Internet was designed to provide a standard means of interconnecting networks so that any system could communicate with any other system, regardless of physical location. It operates as a confederated network of networks (an "internet"), and offers universal accessibility (http://www.teleshuttle.com/media/extradef.htm).

Intranet

An intranet is a private application of the same internetworking technology, software, and applications within a private network, for use within an enterprise. It may be entirely disconnected from the public Internet, but is usually linked to it and protected from unauthorized access by security firewall systems (http://www.teleshuttle.com/media/extradef.htm). An intranet provides access to data across all functional areas of an organization. These functional areas including Sales and Marketing, Manufacturing and Production, Finance and Accounting, and Human Resources. Addtionally, Intranet applications have been developed for each of the aforementioned functional areas (see Figure 1 Above).

Extranet

While an intranet is private and is protected from public visits by firewalls, an organization can create an Extranet to allow authorized suppliers/distributors and customers/shareholders to have limited access to its internal intranet. An Extranet, or extended Internet, is a private business network of several cooperating organizations located outside the corporate firewall. An Extranet service uses existing Internet interactive infrastructure, including standard servers, email clients and Web browsers. This makes the extranet far more economical than the creation and maintenance of a proprietary networks. It enables trading partners, suppliers and customers with common interests to form a tight business relationship and a strong communication bond (see Figure 2).

Extranet Security

A typical Extranet site is partitioned into open and secure segments. Access security is the corner stone of the Extranet concept. Secure connections using Virtual Private Networks (VPN) between computers create a virtual tunnel, using inexpensive and ubiquitous public lines (see Figure 3). (Management Information Systems, pg. 291) Tunnel technology can also be used to individualize the Extranet site, providing access only to the features that a particular user is entitled to.

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