1. Ch. 12 Planning for Electronic Commerce Kevin Lyles

2. Learning Objectives Planning electronic commerce initiatives Planning electronic commerce initiatives Strategies for developing electronic commerce web sites Strategies for developing electronic commerce web sites Managing electronic commerce implementations Managing electronic commerce implementations

3. Planning Electronic Commerce Initiatives OBJECTIVE1

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

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

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

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

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

9. Managing Costs

10. continued

12. Comparing Benefits to costs Capital Projects- major investments in equipment, personnel, and other assets Capital Projects- major investments in equipment, personnel, and other assets

13. Return On Investment ROI= return divided by the investment ROI= return divided by the investment ROI requires all costs and benefits be stated in dollars ROI requires all costs and benefits be stated in dollars ROI focuses on benefits that can be predicted ROI focuses on benefits that can be predicted Cisco example Cisco example

14. Strategies for Developing Electronic Commerce Websites Objective2

16. Internal Development vs. Outsourcing The internal team The internal team Knowledge Knowledge Creative Thinkers Creative Thinkers Credibility Credibility Success should be measurable Success should be measurable

17. Early Outsourcing Initial site design and development for quick launch Initial site design and development for quick launch Internal IT should be involved Internal IT should be involved

18. Late Outsourcing Design is internal Design is internal Maintenance is external Maintenance is external Electronic commerce lend themselves more to early outsourcing Electronic commerce lend themselves more to early outsourcing

19. Partial Outsourcing A.K.A. Component outsourcing A.K.A. Component outsourcing Outsource specific portions Outsource specific portions Examples: e-payment, e-mail systems, Web-hosting Examples: e-payment, e-mail systems, Web-hosting

20. Selecting a Hosting Service Functionality Functionality Reliability Reliability Bandwidth and server scalability Bandwidth and server scalability Security Security Backup and disaster recovery Backup and disaster recovery Cost Cost

21. New Methods for Implementing Partial Outsourcing Incubators: Idealab! Was an incubator for Carsdirect.com, Overstock.com, and Tickets.com Incubators: Idealab! Was an incubator for Carsdirect.com, Overstock.com, and Tickets.com Fast Venturing Fast Venturing

22. Managing Electronic Commerce Initiatives Objective3

23. Project Management Developed by US military in 1950s Developed by US military in 1950s Project Plan: Cost, schedule, and performance Project Plan: Cost, schedule, and performance Project management software Project management software Microsoft Project Microsoft Project Primavera Project Planner Primavera Project Planner

24. Project Portfolio management Each project is monitored as if it were in an investment portfolio Each project is monitored as if it were in an investment portfolio

25. Staffing for Electronic Commerce Business Managers Business Managers Project Managers Project Managers Account Managers Account Managers Applications Specialist Applications Specialist Web Programmers Web Programmers Web Graphics Designers Web Graphics Designers Content Creators Content Creators

26. Staffing for Electronic Commerce Content Managers and Editors Content Managers and Editors Customer Service Customer Service Systems Administrator Systems Administrator Network Operations Network Operations Database Administrator Database Administrator

27. Post Implementation Audits Formal Review Formal Review Did we meet our objectives? Did we meet our objectives? Comprehensive report Comprehensive report