MELJUN CORTES
Electronic CommerceCOMP3210
Session Objectives1,2,3   The objectives of this session are:       To describe how to prepare a simple business        ...
Business Plans   What is a business    plan?   Why should I create a    business plan?   What are the sections    of a ...
What is a Business Plan?   A business plan is a document which    highlights (for the given year):       A plan of how t...
Why Should I Create a Business Plan?      A business plan forces a business to assess       the market place      It for...
The Sections of a Business Plan   There are seven essential sections of a business    plan. These are the:       Executi...
Executive Summary   The executive summary follows the title page of    the business plan   The purpose of the executive ...
Executive Summary Cont’dThe key elements of an executive summary are: 1. The business concept      What is the business y...
Executive Summary Cont’d4. Current business position     This includes any relevant information about      the company, i...
Business Description   This section often begins with a short description    of the industry, its present outlook and fut...
Business Description Cont’d   Describe the product or service you intend    to market   Show how your business will gain...
Define Your Market   Define the entire market for your industry       in terms of size, structure, growth prospects,    ...
Define Your Market Cont’d   After defining your market you must:       Estimate your market share for the period of     ...
Define Your Market Cont’d   After researching the market, the    information gained should be used to:       Identify ob...
Identify and Analyse Your Competition       Determine who your competitors are       What strategies are they using to s...
Design and Development Plan   The design and development plan allows    investors to understand:       The design of you...
Design and Development Plan Cont’d     The sections included in the development plan      include:         Product devel...
Operations and ManagementPlan   Describes how the business functions       It explains business logistics:           Th...
Financial Statements   The three common financial statements are:       The balance sheet           A statement of your...
Planning E-commerce Initiatives   A successful business    plan should include    activities that:       Identify object...
Identifying Objectives   Objectives businesses strive to achieve using e-    commerce include:       Increase sales in e...
Types of Objectives   Objectives vary with the size of the organisation,    for example:       Small companies might wan...
SMART Objectives   Objectives must be:       Specific       Measurable       Achievable       Results-based       Ti...
An Example GIST                  To create a comprehensive testers guide                       for the Icon Income system....
Linking Objectives to BusinessStrategy   After identifying objectives a company    must:       identify business strateg...
Linking Objectives to BusinessStrategy Cont’d   Businesses can use downstream strategies    to improve the value that the...
Linking Objectives to BusinessStrategy Cont’d   E-commerce can inspire businesses to partake in    activities such as:   ...
Linking Objectives to BusinessStrategy Cont’d   E-commerce can inspire businesses to partake in    activities such as:   ...
Measuring Benefit   Some benefits are tangible and easy to measure,    for example increase sales, decrease cost   Other...
Measuring Benefit Cont’dBuild brand         Surveys or opinion polls                    that measure brand                ...
Measuring Benefit Cont’dReduce cost of     Quantity and type (telephone,after-sale support fax, e-mail) of support activit...
Managing Cost   IT projects are often difficult to estimate    and control       E.g. web development technologies chang...
Total Cost of Ownership   The project budget must include       Hardware and software cost       Costs of hiring, train...
Total Cost of Ownership Cont’d   The total cost of ownership (TCO) includes       Cost of hardware (servers, routers, fi...
Change Management   Every project involves change   Change management is the process of    helping employees cope with c...
Change Management Cont’d   If change is not properly managed,    employees feel       Uncomfortable       Inadequate   ...
Opportunity Cost   Opportunity cost is the benefit that will be    lost if a company chooses not to initiate an    e-comm...
Web Site Costs   The cost required for a large company to    build an entry-level e-commerce site is    US$1 million    ...
Web Site Costs Cont’d   The cost required for a large company to build a    site that is comparable to leading sites is U...
Web Site Costs Cont’d   A small company can put a Web site online for    US$5000   For a business with full transaction ...
Web Site Costs Cont’d   Web site costs include       Start-up cost       Ongoing costs (between 50% - 200% of        in...
Web Site Costs Cont’d   The cost for a full portal magazine site       To build: US$2.4 million       US$4.3 million pe...
Web Site Costs Example   Kmart (http://www.kmart.com/)       >US$140 million to create online retail        website    ...
Web Site Costs: A Final Word   The high cost of creating e-commerce Web sites    can serve as a discouragement to small b...
Comparing Benefits to CostsIdentify   Determine valuebenefits      of benefits                             Compare value  ...
Return On Investment (ROI)   Return on Investment techniques measure    the amount of income (return) that will be    pro...
ROI Hidden Benefits Example   CISCO systems created an on-line customer    forum to discuss product issues   The intende...
ROI Problems   If managers rely only on ROI incorrect    decision may be made       Due to biases towards short term cos...
Strategies For Developing E-commerce Web Sites   1994-1996: Static Brochures       Contact information       Logos and ...
Strategies For Developing E-commerce Web Sites Cont’d   1996 – 1999: Transaction Processing       Static brochures plus ...
Strategies For Developing E-commerce Web Sites Cont’d   1999 – Present: Full Range of Automated    Business Processes    ...
Internal Development v. Outsourcing     Definition:         Outsourcing is the hiring of outside support          to do ...
Internal Development v.Outsourcing Cont’d   Using internal people to lead e-commerce    initiatives helps to ensure that ...
Internal Development v.Outsourcing Example   Few companies are large enough or have    sufficient expertise to launch an ...
Internal Teams   In determining which parts of an e-project    to outsource first create an internal team       Include ...
Internal Teams Cont’d   Do not select a technical wizard as project    leader if he/she       does not have the necessar...
Internal Teams Cont’d   Set aside between 5-10% of a project’s    budget for       quantifying the projects value and me...
Internal Teams Cont’d   The internal team decides       Which part of the project to outsource       Who the parts will...
Types of Outsourcing   There are three types of outsourcing       Early outsourcing           E-commerce initiatives le...
Early Outsourcing   The initial site design and development is    outsourced in order to launch it quickly       An e-co...
Late Outsourcing   This is the more traditional way   The company’s information system professionals    do the initial d...
Partial Outsourcing   The company identifies specific portions of    the project that can be completely    designed, deve...
Partial Outsourcing Cont’d   E-commerce initiatives can benefit from    partial outsourcing   Partial outsourcing is als...
Partial Outsourcing Example   Many smaller Web sites outsource their email    handling and response functions   Electron...
Selecting a Web Hosting Service   The internal team should be responsible for    selecting the ISP to host the site     ...
Selecting a Web Hosting ServiceCont’d   The most important factors to use when    evaluating a hosting service are:     ...
New Methods for implementingPartial Outsourcing   In the past five years new ways of    implementing partial outsourcing ...
Incubators   A company that offers start-up companies a    physical location with offices, accounts and    legal assistan...
Incubators Cont’d   When the company grows and can obtain    venture capital financing or can publicly    offer stock, th...
Internal Incubators   Internal incubators are incubators that are    set up by a company (using internal staff),        ...
Internal Incubators Cont’d   A new internal incubator model has emerged    where the resulting technology is left under t...
Fast Venturing   An existing company that wants to launch an e-    commerce initiative joins with external equity    and ...
Fast Venturing Cont’dVenture              Equity partners   Operationalsponsor              Review and refine partnersDeve...
Managing E-Commerce Initiatives   Project management   Project portfolio    management   Specific staffing   Post-impl...
Managing Electronic CommerceInitiatives   To manage complex e-commerce    implementations formal management    techniques...
Project Management   A collection of formal techniques for planning    and controlling the activities undertaken to    ac...
Project Portfolio Management   A technique used to manage multiple    projects       Each project is monitored as if it ...
Staffing for E-Commerce   The internal team must determine the staffing    needs for the e-commerce initiatives   The ge...
Business Manager   Should be a member of the internal team   Sets objectives for the project   Responsible for implemen...
Project Manager   Specific training or skills in tracking costs    and accomplishing project goals   Certification might...
Account Manager   Keeps track of multiple Web sites in use by a    project   Or keeps track of projects that will combin...
Application Specialist   Maintain accounting, human resources, and    logistics software   Must maintain e-commerce soft...
Other Roles   Web programmers       Design and write code for Web site   Web graphics designers       A person trained...
Other Roles Cont’d   Customer service personnel       Help design and implement customer        relationship management ...
Other Roles Cont’d   Systems administrator       Responsible for system reliability and security   Network operation st...
Post-Implementation Audits   A formal review of a project after it is up    and running   Managers compare the the objec...
Post-Implementation Audits Cont’d    The purpose is not to lay blame but to:        Provide project and business manager...
References[1] Tiffany, Laura, “Elements of a Business Plan”, March 2001. Online document      available at http://wwww.ent...
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MELJUN CORTES E Commerce 5

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  • Reference: Tiffany, Laura, “Elements of a Business Plan”, http://wwww.entrepreneur.com/article/print/0,2361,287355,00.html, March 2001 “ Purpose Of The Marketing Plan ”, Online Women's Business Center , http://www.onlinewbc.gov/docs/market/mk_plan_why.html , May 1997
  • MELJUN CORTES E Commerce 5

    1. 1. MELJUN CORTES
    2. 2. Electronic CommerceCOMP3210
    3. 3. Session Objectives1,2,3 The objectives of this session are:  To describe how to prepare a simple business plan  To describe how to develop objectives  To analyse strategies used to fulfil objectives  And to analyse methods used to manage e- commerce initiatives
    4. 4. Business Plans What is a business plan? Why should I create a business plan? What are the sections of a business plan? http://www.paragonventures.com/business%20plan%20d8dgvd8.gif
    5. 5. What is a Business Plan? A business plan is a document which highlights (for the given year):  A plan of how the company will be run  The goals of the company  The money required to meet those goals  The strategy employed to meet those goals (including marketing)
    6. 6. Why Should I Create a Business Plan?  A business plan forces a business to assess the market place  It forces a business to identify a clear marketing strategy  It also serves as a benchmark which the company’s performance can be measured against.
    7. 7. The Sections of a Business Plan There are seven essential sections of a business plan. These are the:  Executive Summary  Business Description  Define Your Market  Identify and Analyse Your Competition  Design and Development Plan  Operations and Management Plan  Financial Statements
    8. 8. Executive Summary The executive summary follows the title page of the business plan The purpose of the executive summary is to explain to the reader what the business wants The summary should be short and concise (maybe half a page, typically no longer than a page)  People do not have time to waste reading long documents
    9. 9. Executive Summary Cont’dThe key elements of an executive summary are: 1. The business concept  What is the business you are proposing, its products and the advantages over the competition 2. The financial features  Highlight the forecasted sales, profits, cash flows and return on investment 3. The financial requirements  What are the start-up costs and the cost of expansion. How will this money be used?
    10. 10. Executive Summary Cont’d4. Current business position  This includes any relevant information about the company, its formation date, its owners and key personnel5. Major achievement  Are there any developments which are essential to the success of the business? These may include prototypes, patents or crucial contracts
    11. 11. Business Description This section often begins with a short description of the industry, its present outlook and future possibilities  Include any products or developments that might affect your business State whether the business is new or already in existence; and the type of operation, e.g. is it retail, food service, manufacturing or service- oriented? State who your customers will be and how your product will be distributed and advertised
    12. 12. Business Description Cont’d Describe the product or service you intend to market Show how your business will gain the competitive edge Explain how the business will be profitable
    13. 13. Define Your Market Define the entire market for your industry  in terms of size, structure, growth prospects, trends and sales potential Define the specific market that you will be targeting (market segmentation) Define your niche in this market
    14. 14. Define Your Market Cont’d After defining your market you must:  Estimate your market share for the period of time the business plan covers  Position your business  Price your product  Determine the distribution strategy  Create a promotion plan  Estimate your sales potential
    15. 15. Define Your Market Cont’d After researching the market, the information gained should be used to:  Identify objectives  And develop strategies that will allow you to fulfil these objectives  This will be the focus of the next section
    16. 16. Identify and Analyse Your Competition  Determine who your competitors are  What strategies are they using to sell their products or service  What are their strengths and weaknesses
    17. 17. Design and Development Plan The design and development plan allows investors to understand:  The design of your product  How it is produced  How it will be marketed  The development budget required to allow the company to meet its goals
    18. 18. Design and Development Plan Cont’d  The sections included in the development plan include:  Product development  Market development  Organisational development  Each of these sections should be described from a funding point of view  Finally, identify measurable goals for the overall design and development plan
    19. 19. Operations and ManagementPlan Describes how the business functions  It explains business logistics:  The responsibilities of the management team  The task assigned to each company division  Capital and expense requirements related to the operation of the business  And the financial tables  The operating expense table  The capital requirements table  The cost of goods table
    20. 20. Financial Statements The three common financial statements are:  The balance sheet  A statement of your assets, liabilities and equity  The Income statement  Reflects when sales are made and expenses are incurred  The statement of cash flows shows  The amount of cash required to meet obligations, when it is required and from where it will come
    21. 21. Planning E-commerce Initiatives A successful business plan should include activities that:  Identify objectives  Link objectives to business strategy
    22. 22. Identifying Objectives Objectives businesses strive to achieve using e- commerce include:  Increase sales in existing markets  Launching out into new markets  Improve service to existing customers  Identifying new vendors  Coordinating more efficiently with existing vendors  More effective recruiting
    23. 23. Types of Objectives Objectives vary with the size of the organisation, for example:  Small companies might want to build a Web site to encourage customers to do business using existing channels.  A site offering only product or service information is less costly to design and implement  Larger companies that might want to build sites that offer transaction handling, bidding, communication and other capabilities have to pay much more
    24. 24. SMART Objectives Objectives must be:  Specific  Measurable  Achievable  Results-based  Time-bound
    25. 25. An Example GIST To create a comprehensive testers guide for the Icon Income system. SCALE Percentage completed at the specified milestone PLAN 50% (Icon* 5.01), 100% (Icon 5.02). MUST 25% (Icon 5.01), 75% (Icon 5.02). ACTUAL 10% (Icon 5.01), 25% (Icon 5.02)*In this example, Icon is the name of a software product.
    26. 26. Linking Objectives to BusinessStrategy After identifying objectives a company must:  identify business strategies that will help to realise these objectives  e.g. a small company’s objective might be to become a global player within a year and as a result one of its activities might be to build its brand
    27. 27. Linking Objectives to BusinessStrategy Cont’d Businesses can use downstream strategies to improve the value that the business provides to customers Or can pursue upstream strategies that focus on reducing cost or generating value by working with suppliers or inbound shipping and freight service providers
    28. 28. Linking Objectives to BusinessStrategy Cont’d E-commerce can inspire businesses to partake in activities such as:  Building brands  Enhance existing marketing programs  Sell products and services  Sell advertising  Develop a better understanding of the customer’s need  Improve after sales support and service
    29. 29. Linking Objectives to BusinessStrategy Cont’d E-commerce can inspire businesses to partake in activities such as:  Purchase products and services  Manage supply chains  Operate auctions  Build virtual communities However, these can not be done in an ad hoc manner. It is important to measure the benefit and cost of each activity
    30. 30. Measuring Benefit Some benefits are tangible and easy to measure, for example increase sales, decrease cost Others are intangible thus difficult to measure, for example increased customer satisfaction Managers need to try to set objectives that are measurable even for intangible benefits  E.g. increased customer satisfaction might be measured by counting the number of first-time customers who return to the Web site and make a purchase
    31. 31. Measuring Benefit Cont’dBuild brand Surveys or opinion polls that measure brand awarenessEnhance existing Change in per-unit salesmarketing program volumeImprove customer Customer satisfactionservice surveys, quantity of customer complaints
    32. 32. Measuring Benefit Cont’dReduce cost of Quantity and type (telephone,after-sale support fax, e-mail) of support activitiesImply supplier Cost, quality and on-timechain operation delivery of materials or services purchasedHold auctions Quantity of auctions, bidders, sellers, items sold, registered participants, dollar value of items soldProvide portals Number of visitors
    33. 33. Managing Cost IT projects are often difficult to estimate and control  E.g. web development technologies change rapidly, thus it is difficult for managers to estimate cost  These cost include hardware and software Even though hardware costs tend to decrease, new software often demands new hardware, thus increases costs
    34. 34. Total Cost of Ownership The project budget must include  Hardware and software cost  Costs of hiring, training and paying personnel  Web site designers, developers, content providers, operators and maintainers Organisations tend to track costs by activity
    35. 35. Total Cost of Ownership Cont’d The total cost of ownership (TCO) includes  Cost of hardware (servers, routers, firewalls and load balancing devices)  Cost of software (licenses for operating systems, Web server software, database software, and application software)  Cost of outsourced design work  Salaries and benefits for employees  Cost of maintaining the site once operational A good TCO will include cost of future redesign
    36. 36. Change Management Every project involves change Change management is the process of helping employees cope with change Change management techniques include  Communicating the need for change  Inclusion in the change decision process  Inclusion in the planning for the change
    37. 37. Change Management Cont’d If change is not properly managed, employees feel  Uncomfortable  Inadequate  Stressed which leads to reduced work performance  Unable to do the job properly  Powerless
    38. 38. Opportunity Cost Opportunity cost is the benefit that will be lost if a company chooses not to initiate an e-commerce initiative This is of great concern to management and accountants
    39. 39. Web Site Costs The cost required for a large company to build an entry-level e-commerce site is US$1 million  79% is labour cost  10% software cost  11% hardware cost  Source: International Data Corporation and Gartner Inc.
    40. 40. Web Site Costs Cont’d The cost required for a large company to build a site that is comparable to leading sites is US$2 - $5 million To build a Web site that is noticeably better than competitors will cost a minimum of US$15 million 10 of the top 100 e-commerce sites spent over US$10 million for Web site development and implementation Source: International Data Corporation and Gartner Inc
    41. 41. Web Site Costs Cont’d A small company can put a Web site online for US$5000 For a business with full transaction and payment processing capabilities, it is difficult to keep it under US$10,000 per year Construction of new Web sites for small businesses actually averages US$140,000 Minimum amount to open a complete e- commerce Web site is US$150,000
    42. 42. Web Site Costs Cont’d Web site costs include  Start-up cost  Ongoing costs (between 50% - 200% of initial cost)
    43. 43. Web Site Costs Cont’d The cost for a full portal magazine site  To build: US$2.4 million  US$4.3 million per year to maintain with a staff of 35 people The cost for a more limited site  To build: US$150,000  US$270,000 per year to maintain with a staff of 2 people
    44. 44. Web Site Costs Example Kmart (http://www.kmart.com/)  >US$140 million to create online retail website  Much of the site’s cost is hidden from the user  Cost of customising middleware that connects the Web site to Kmart’s vast inventory and logistics databases
    45. 45. Web Site Costs: A Final Word The high cost of creating e-commerce Web sites can serve as a discouragement to small businesses Smaller organisations can control costs by:  Using a combination of third party hosting services and packaged e-commerce software  Sign up for mall-style service providers This provides low initial cost and controls annual TCO, however cost of related activities can not be ignored, e.g. creating and maintaining a product catalog
    46. 46. Comparing Benefits to CostsIdentify Determine valuebenefits of benefits Compare value of benefits to value of costIdentify Determine value costs of costs
    47. 47. Return On Investment (ROI) Return on Investment techniques measure the amount of income (return) that will be provided by a specific expenditure  ROI requires that all costs are stated in a dollar amount  ROI focuses on benefits that can be predicted  Many benefits are often hidden  ROI tends to emphasise short-term benefits over long term benefits
    48. 48. ROI Hidden Benefits Example CISCO systems created an on-line customer forum to discuss product issues The intended benefits were to  Reduce customer service costs  Increase customer satisfaction regarding the availability of product information Additional (hidden) benefit  Cisco engineers were able to get feedback on new products
    49. 49. ROI Problems If managers rely only on ROI incorrect decision may be made  Due to biases towards short term cost and benefits rather than long term
    50. 50. Strategies For Developing E-commerce Web Sites 1994-1996: Static Brochures  Contact information  Logos and or other branding  Some product information  Financial statements
    51. 51. Strategies For Developing E-commerce Web Sites Cont’d 1996 – 1999: Transaction Processing  Static brochures plus  Complete product catalog  Shopping cart  Secure payment processing  Other information queries  Shipment tracking
    52. 52. Strategies For Developing E-commerce Web Sites Cont’d 1999 – Present: Full Range of Automated Business Processes  Transaction processing, plus  Personalisation  Interactive capabilities  Frequently updated content  Customer relationship  Management tools
    53. 53. Internal Development v. Outsourcing  Definition:  Outsourcing is the hiring of outside support to do all or part of a project  E-commerce site development problems can not be avoided by outsourcing  Success depends on how well the e- commerce initiative is integrated into and supports business activities
    54. 54. Internal Development v.Outsourcing Cont’d Using internal people to lead e-commerce initiatives helps to ensure that the companies specific needs are addressed and that the plan fits the culture  Outside consultants are seldom able to learn enough about the culture (in the contract period) in order to accomplish all the objectives
    55. 55. Internal Development v.Outsourcing Example Few companies are large enough or have sufficient expertise to launch an e- commerce project without external help  E.g. Wal-mart (with annual sales of $150 billion) in 2000 hired another company for outside support
    56. 56. Internal Teams In determining which parts of an e-project to outsource first create an internal team  Include people:  With technical know-how about the Internet  Creative thinkers  Already successful employees
    57. 57. Internal Teams Cont’d Do not select a technical wizard as project leader if he/she  does not have the necessary business skills  Is not well-known and respected by the operating function managers  Is not creative
    58. 58. Internal Teams Cont’d Set aside between 5-10% of a project’s budget for  quantifying the projects value and measuring the achievement (e.g using metrics) More and more companies are realising the importance of their staff’s knowledge about the business and its processes  These resources do not appear in companies financial statements
    59. 59. Internal Teams Cont’d The internal team decides  Which part of the project to outsource  Who the parts will be outsourced to  Which partners the company needs to hire for the project
    60. 60. Types of Outsourcing There are three types of outsourcing  Early outsourcing  E-commerce initiatives lend themselves more to early outsourcing  Late Outsourcing  Partial outsourcing
    61. 61. Early Outsourcing The initial site design and development is outsourced in order to launch it quickly  An e-commerce site can rapidly become a source of competitive advantage for a company Outsourcing team trains company information system professionals in the technology and hands over the operation of the site It is best for the company’s own information systems people to work closely with the outsourcing team and develop ideas for improvements as early as possible
    62. 62. Late Outsourcing This is the more traditional way The company’s information system professionals do the initial design and development work, implement the system and operate it until it becomes a stable part of the business After the competitive advantage is gained, the system is outsourced, allowing the team to pursue new technology projects
    63. 63. Partial Outsourcing The company identifies specific portions of the project that can be completely designed, developed, implemented and operated by another firm that specialises in a particular function  In both early and late outsourcing a single group is responsible for the entire design, development and operation of a project
    64. 64. Partial Outsourcing Cont’d E-commerce initiatives can benefit from partial outsourcing Partial outsourcing is also called component outsourcing
    65. 65. Partial Outsourcing Example Many smaller Web sites outsource their email handling and response functions Electronic payment systems  A company may use an external vendor to take care of payment processing  When the customer is ready to pay, he/she is taken to another site and then returned to the original site  The most common part of an e-commerce project that is outsourced is the web-hosting activity
    66. 66. Selecting a Web Hosting Service The internal team should be responsible for selecting the ISP to host the site  For smaller e-commerce projects teams can consult an ISP dictionary (for ISPs, web hosting services or ASPs (application service provider))  Larger companies should use consultants or other firms that rate service providers
    67. 67. Selecting a Web Hosting ServiceCont’d The most important factors to use when evaluating a hosting service are:  Functionality  Reliability  Bandwidth and server scalability  Security  Backup and disaster recovery  Cost
    68. 68. New Methods for implementingPartial Outsourcing In the past five years new ways of implementing partial outsourcing have been created  Incubators  Fast venturing
    69. 69. Incubators A company that offers start-up companies a physical location with offices, accounts and legal assistance, computers, and Internet connections at a very low monthly cost  Some also offer seed money, management advice and marketing assistance In exchange the company gives 10-50% ownership of the company to the Incubator
    70. 70. Incubators Cont’d When the company grows and can obtain venture capital financing or can publicly offer stock, the Incubator sells all or part of its interest and re-invests in a new incubator candidate Example:  Idealab (www.idealab.com/) was one of the first Internet incubators and helped www.carsdirect.com/home
    71. 71. Internal Incubators Internal incubators are incubators that are set up by a company (using internal staff),  e.g. Kodak internal venturing program of the 1980s Most of these were unsuccessful because employees found it difficult to maintain an entrepreneurial spirit when what ever they developed would be taken away and controlled by the parent company
    72. 72. Internal Incubators Cont’d A new internal incubator model has emerged where the resulting technology is left under the control of the team, who form a company The parent company and the new company then become strategic partners This new internal incubator model promises to be more successful than the traditional model
    73. 73. Fast Venturing An existing company that wants to launch an e- commerce initiative joins with external equity and operational partners that can offer the experience and skills that can scale up the project rapidly  Equity partners are usually banks or venture capitalist that can offer money or expertise  Operational partners are firms, such as system integrators, consultants and Web portals who have the experience in moving projects along and scaling up prototypes
    74. 74. Fast Venturing Cont’dVenture Equity partners Operationalsponsor Review and refine partnersDevelop ideas. ideas. Turn ideas into aStaffs internal Provide advice. business plan.team. Evaluate prototype. Provide financial,Create prototype. Provide contacts technical andProvide all or (including operations expertise.most of the start- operational Provide industry bestup funds. partners). practice knowledge. Scale up prototype to an operating model.
    75. 75. Managing E-Commerce Initiatives Project management Project portfolio management Specific staffing Post-implementation audits
    76. 76. Managing Electronic CommerceInitiatives To manage complex e-commerce implementations formal management techniques should be used:  Project management  Project portfolio management  Specific staffing  Post-implementation audits
    77. 77. Project Management A collection of formal techniques for planning and controlling the activities undertaken to achieve a specific goal The project plan includes cost, schedule and performance Applications such as Microsoft Project and Primavera Project Planner help with project planning These type of projects (e-commerce projects) have a reputation for failing
    78. 78. Project Portfolio Management A technique used to manage multiple projects  Each project is monitored as if it is an investment in a financial portfolio  Each project is assigned a rank based on its importance to the strategic goals of the business and level of risk  E-commerce projects are viewed as investments in assets
    79. 79. Staffing for E-Commerce The internal team must determine the staffing needs for the e-commerce initiatives The general areas of staffing required are:  Business, project and account managers  Application specialists  Web programmers and graphic designers  Content creators, managers or editors  Customer service  System, and database administration  Network operations
    80. 80. Business Manager Should be a member of the internal team Sets objectives for the project Responsible for implementing the elements of the business plan and reaching the objectives set Develops proposal for plan revisions and funding Should have the required domain knowledge (e.g. retail knowledge if a retail Web site is being built)
    81. 81. Project Manager Specific training or skills in tracking costs and accomplishing project goals Certification might be useful (e.g. Project Management Institute) or MBA Skills in the use of project management software
    82. 82. Account Manager Keeps track of multiple Web sites in use by a project Or keeps track of projects that will combine to make a larger Web site The account manager supervises the location of specific Web pages and related software installations as they are moved from test, to demonstration, to production In smaller companies they handle the project and account management functions
    83. 83. Application Specialist Maintain accounting, human resources, and logistics software Must maintain e-commerce software, e.g. catalogs, payment processing
    84. 84. Other Roles Web programmers  Design and write code for Web site Web graphics designers  A person trained in art, layout, composition and understands how Web pages are constructed Content creators  Write original content Content managers/editors  Purchase existing material and adapt it
    85. 85. Other Roles Cont’d Customer service personnel  Help design and implement customer relationship management activities, e.g. issue passwords, design customer interface features, handle customer e-mail and telephone requests for service and conduct telemarketing for the site  Some companies hire a call centre to handle phone calls and e-mail
    86. 86. Other Roles Cont’d Systems administrator  Responsible for system reliability and security Network operation staff  Load estimation and monitoring, resolving network problems and managing network operations Database administration  Support activities such as transaction processing, order entry, inquiry management or shipment logistics
    87. 87. Post-Implementation Audits A formal review of a project after it is up and running Managers compare the the objectives, performance specifications, cost estimates, and scheduled delivery dates plans with the actuals
    88. 88. Post-Implementation Audits Cont’d  The purpose is not to lay blame but to:  Provide project and business managers to raise questions about the objectives and use the feedback in other projects  The audit should result in a comprehensive report that analyses the project performance, the administration, organisational structure and the performance of the project team  Some audits contain a confidential section which evaluates the performance of individual team members – to help when choosing teams in future
    89. 89. References[1] Tiffany, Laura, “Elements of a Business Plan”, March 2001. Online document available at http://wwww.entrepreneur.com/article/print/0,2361,287355,00.html[2] Online Womens Business Center, “Purpose Of The Marketing Plan”, May 1997.http://www.onlinewbc.gov/docs/market/mk_plan_why.html [3] Schneider, Gary, P., “Electronic Commerce: The second wave”, Thomson Course Technology, Fifth Annual Edition, 2004

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