14.3 Difficulties in measuring and justifying e-commerce investmentsJustifying EC (and IT) projects can be complex, and therefore, difficult to justify. Let us see why.The EC justification processThe EC justification process varies depending on the situation and the methods used. However, in its extreme, it can be very complex. As shown in Figure 14.3, five areas must be considered in the justification of IT projects. In this section,We discuss the intangible and tangible areas. In chapter13, we discussed some strategic and tactical considerations.In addition to the complex process, one may face other difficulties in conducting justification.Difficulties in measuring productivity and performance gains.One of the major benefits of using EC is increases may be difficult to measure for a number of reason.Data and analysis issuesData, or the analysis of data, may hide productivity gains. Why is this so? In manufacturing, it is easy to measure outputs and inputs. For example Toyota produces motor vehicle a relatively well defined product that shows gradual quality changes over time. It is not difficult to identify the resources used to produce these vehicles with reasonable accuracy. However, in services, or health care delivery, it is more difficult to define what the products are, how they differ in quality, and how they may be related to corresponding benefits and costs.Other generic factors are: EC productivity gains in one area may be offset by losses in other areas
Hidden costs and benefits
Incorrectly defining what is measured
Relating EC and its expenditures to organizational performance
It may be difficult to find the relationship between EC investment and organizatil performance.
The reason is that the relationship between investment and performance may be indirect; factors such as shared EC and IT assets and how they are used can impact organizational performance and make it difficult to assess the value of an investment.
Other difficulties
The long time lags between investment and profit realization may throw off productivity measurements.
Intangible costs and benefits.
In many cases EC projects generate intangible benefits, such as faster time-to-maker, and increased employee and customer satisfaction. These are very desirable benefits, but it may be difficult to place an accurate monetary value on them. For example, it is generally known that e-mail improves communications, but it is difficult to measure the value of this improvement.
Tangible costs and benefits
The costs involved in purchasing hardware, soft-ware, consulting, and support services usually are tangible, as are the costs of telecommunication services, maintenance, and direct labor. These costs can be measured through accounting information systems (from the general ledger). Similarly, tangible benefits, including increased profitability, improved productivity, and greater market share, can be measured with relative ease.
In tangible costs and benefits
When it comes to intangible costs and benefits, organization must develop innovative metrics to track these as accurately as possible. Intangible costs may range from the inclusion of some vague costs such as those resulting from the learning curve during of the incorporation of an EC system, to better respond to customer inquiries. Another intangible cost may result from the need to change or adaption of certain business processes such as building and operating an inventory tracking system. An additional difficult is separating EC costs from the costs of routine maintenance of inventory and other relevant IT systems.
Managing intangible benefits
The first step in managing intangible benefits is to define them (see the opening case of Telstra), and if possible, specify how they are going to be measured.
A simple solution is to make rough estimates of the monetary values of all the intangible benefits and then conduct an ROI or similar financial analysis. The simplicity of this approach is appealing, but in many cases, the simplification assumptions used in these estimated are questionable. If the estimates were too high, a wrong investment may have been made. An estimate that is too low may result in disregarding a good investment and potentially losing a competitive advantage. Intangible costs and benefits may be approached in a number of different ways. Several of the methods presented in section 14.4 also can be used to evaluate intangible benefits, for more on intangible costs and benefits, see Ritter and RO ̈ttgers (2008).
One way to deal with intangible benefits is to develop a balanced scorecard (chapter 13) for the proposed investments, this approach requires listing both tangible and their measures. For an example of how this works, see Asefeso (2014)
These difficulties can cause many companies not to measure the value of IT and EC projects which can be a risky approach. For those companies that conduct a formal justification, we present a number of methods in Sections 14.5 and 14.5.
đang được dịch, vui lòng đợi..