IMPACT OF E-COMMERCE TOWARD INDONESIAN SILK INDUSTRY : THE CHANGING VALUE CHAIN OF SMALL MEDIUM ENTERPRISE IN SOUTH SULAWESI MUNICIPALITIES

The advent of the internet and information technology has revolutionarized the way small medium enterprise do business, particularly those that in the silk industry. This preliminary research will look at the definitions of e-commerce by various authors including Turban et al (2002) and Nezu (2001). A definition of commerce will be suggested that takes into account all the areas in e-commerce including business-to-business e-commerce and intrabusiness e-commerce which are usually not mentioned in many definitions of e-commerce.The new types of products i.e. digital products as well as the new business models which include content, affiliate and customization will be mentioned. The impact of technology on the value chain in particular disintermediation and cybermediation with relevancies from the Indonesian Silk Industry will be discussed.The theory of Diffusion of Innovation will be stated used to understand the evolution of the internet and the adoption of web technologies by SME.Finally, the future of e-commerce which includes the lessons learnt from start-up failures and the way that click-and-mortar industries can be successful will be discussed.