Ch. 12 Planning for Electronic Commerce

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Ch. 12Planning for Electronic Commerce

• Kevin Lyles

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Learning Objectives

• Planning electronic commerce initiatives
• Strategies for developing electronic commerce web
  sites
• Managing electronic commerce implementations

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Planning Electronic Commerce Initiatives

• OBJECTIVE
• 1

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Identifying objectives

• Increasing sales in existing markets
• Opening new markets
• Serving existing customers better
• Identifying new vendors
• Coordinating more efficiently with existing
  vendors
• Recruiting employees more effectively

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Linking Objectives to Business Strategies

• Downstream strategies- improve the value that the
  business provides to its customers
• Upstream strategies- focus on reducing costs or
  generating value by working with suppliers or
  inbound shipping and freight service providers

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Linking Objectives to Business Strategies

• Building brands
• Enhancing existing marketing programs
• Selling products and services
• Developing a better understanding of customers
  needs
• Improving after-sale service and support
• Purchasing products and services
• Managing supply chains
• Operating auctions
• Building virtual communities and web portals

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Measuring Benefits

• Tangible- easy to measure. Sales and costs for
  example
• Intangible- difficult to measure. Increased
  customer satisfaction
• Online Surveys
• Metrics- measurements used to assess the value of
  benefits

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Managing Costs

• Total Cost of Ownership- everything
• Change Management- process of helping employees
  cope with impending change
• Opportunity cost- Best use?
• Web-site costs-79 labor, 10 software, and 11
  hardware
• 10 of top 100 spent over 10,000,000

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Managing Costs
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Comparing Benefits to costs

• Capital Projects- major investments in equipment,
  personnel, and other assets

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Return On Investment

• ROI return divided by the investment
• ROI requires all costs and benefits be stated in
  dollars
• ROI focuses on benefits that can be predicted
• Cisco example

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Strategies for Developing Electronic Commerce
Websites

• Objective
• 2

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Internal Development vs. Outsourcing

• The internal team
• Knowledge
• Creative Thinkers
• Credibility
• Success should be measurable

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Early Outsourcing

• Initial site design and development for quick
  launch
• Internal IT should be involved

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Late Outsourcing

• Design is internal
• Maintenance is external
• Electronic commerce lend themselves more to early
  outsourcing

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Partial Outsourcing

• A.K.A. Component outsourcing
• Outsource specific portions
• Examples e-payment, e-mail systems, Web-hosting

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Selecting a Hosting Service

• Functionality
• Reliability
• Bandwidth and server scalability
• Security
• Backup and disaster recovery
• Cost

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New Methods for Implementing Partial Outsourcing

• Incubators Idealab! Was an incubator for
  Carsdirect.com, Overstock.com, and Tickets.com
• Fast Venturing

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Managing Electronic Commerce Initiatives

• Objective
• 3

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Project Management

• Developed by US military in 1950s
• Project Plan Cost, schedule, and performance
• Project management software
• Microsoft Project
• Primavera Project Planner

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Project Portfolio management

• Each project is monitored as if it were in an
  investment portfolio

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Staffing for Electronic Commerce

• Business Managers
• Project Managers
• Account Managers
• Applications Specialist
• Web Programmers
• Web Graphics Designers
• Content Creators

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Staffing for Electronic Commerce

• Content Managers and Editors
• Customer Service
• Systems Administrator
• Network Operations
• Database Administrator

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Post Implementation Audits

• Formal Review
• Did we meet our objectives?
• Comprehensive report