1. EC Strategy, Globalization, and SMEs
Chapter 14
EC Strategy, Globalization, and SMEs

2. Learning Objectives
1. Describe the EC strategy phases. 2. Describe the need for justifying EC investments. 3. Evaluate the issues involved in global EC. 4. Describe the reasons for success and failure of EC. 5. Describe how small and medium-sized businesses can use EC. 6. Describe the major components of EC implementation. 7. Discuss the steps in developing an EC system. 8. Describe the major EC development strategies.

3. Organizational Strategy: Concepts and Overview
The Impact of the Internet
Strategic Planning for IT and EC

4. The Strategy and Performance Cycle and Tools
*Strategy Initiation—Goals
Improved performance
Gain of competitive advantage
Increased sales and revenue
Improved customer and partner service and relationships
Generation of new business models and facilitating innovation

5. The Strategy-Performance Cycle

6. The Strategy and Performance Cycle and Tools
*Strategy Formulation
Specific activities and outcomes from this phase include:
Business opportunities
Cost–benefit analysis
Risk analysis, assessment, and management
Business plan
*Strategy Implementation
The major specific activities and outcomes from this phase include:
Project planning
Resource allocation
Project management

7. The Strategy and Performance Cycle and Tools
*Strategy Assessment
Performance Improvement and Innovations
Major Tools for Strategic Planning

8. Figure 14.2 The performance assessment process
Strategy, Tactics, Plans, Implementation
Balanced Scorecard
Performance Metrics
KPIs
Monitoring Performance
Compare Performance to Metrics
Analytics,
Web Analytics
Reports and Dashboards
Figure 14.2 The performance assessment process

9. WHY JUSTIFY E-COMMERCE INVESTMENTS? HOW CAN THEY BE JUSTIFIED?
Increased Pressure for Financial Justification
Companies are careful with EC expenses and budgets
The demand for expanding or initiating e-business projects is high

10. WHY JUSTIFY E-COMMERCE INVESTMENTS? HOW CAN THEY BE JUSTIFIED?
Other Reasons Why EC Justification Is Needed
EC projects must compete with other internal and external projects for funding and resources
Companies are required to assess the success of EC projects after their completion
The pressure by top management for better alignment of EC strategy with the business strategy
The success of EC projects may be assessed in order to pay bonuses to those involved with the projects

11. WHY JUSTIFY E-COMMERCE INVESTMENTS? HOW CAN THEY BE JUSTIFIED?
EC Investment Categories and Benefits
IT infrastructure provides the foundation for EC projects or applications in the enterprise
EC applications are specific projects and programs for achieving certain objectives
How Is An EC Investment Justified?
Cost–benefit analysis*
Cost–Benefit Analysis and the Business Case

12. WHY JUSTIFY E-COMMERCE INVESTMENTS? HOW CAN THEY BE JUSTIFIED?
What Needs to Be Justified? When Should Justification Take Place?
The following are cases where formal evaluation may not be needed:
When the value of the investment is relatively small for the organization
When the relevant data are not available, are inaccurate, or are too volatile

13. WHY JUSTIFY E-COMMERCE INVESTMENTS? HOW CAN THEY BE JUSTIFIED?
Using Metrics in EC Justification
Metrics, Measurements, and Key Performance Indicators (KPIs)*

14. Figure 12.1 How Metrics Are Used in Performance Management

15. Processes & Efficiency
Financial & Fiduciary
Processes & Efficiency
Capacity & Knowledge
Customers & Stakeholders
Strategy
KPIs/Targets
Figure 14.4 The balanced scorecard approach

16. WHY JUSTIFY E-COMMERCE INVESTMENTS? HOW CAN THEY BE JUSTIFIED?
Web Analytics*
The Process of Justifying EC and IT Projects
Establish an appropriate basis for analysis with your vendor, and then conduct your ROI
Investigate what metrics to use and be sure about their accuracy
Justify the cost-benefit under appropriate assumptions
Verify all data used in the calculation
Include strategic benefits, including long-term ones
Make data as realistic as possible, and include cost avoidance and risk analysis
Commit all business partners, as well as suppliers and major customers to your plans
Justifying Social Networking and the Use of Web 2.0 Tools

17. WHY JUSTIFY E-COMMERCE INVESTMENTS? HOW CAN THEY BE JUSTIFIED?
Web Analytics*
The Process of Justifying EC and IT Projects
Establish an appropriate basis for analysis with your vendor, and then conduct your ROI
Investigate what metrics to use and be sure about their accuracy
Justify the cost-benefit under appropriate assumptions
Verify all data used in the calculation
Include strategic benefits, including long-term ones
Make data as realistic as possible, and include cost avoidance and risk analysis
Commit all business partners, as well as suppliers and major customers to your plans
Justifying Social Networking and the Use of Web 2.0 Tools

18. A STRATEGY FOR GLOBAL E-COMMERCE
Deciding whether to “go global” is a strategic issue
Benefits and Extent of Global Operations
A major advantage of EC is the ability to conduct business at any time, from anywhere, and at a reasonable cost
Globalization and Social Networking

19. A STRATEGY FOR GLOBAL E-COMMERCE
Barriers to Global E-Commerce
Cultural Differences
Language Translation
Machine Translation
Legal Issues
Geographic Issues and Localization
Web Localization
Payments in Global EC Trades
Economic and Financial Issues
E-Commerce in Developing Countries

20. A STRATEGY FOR GLOBAL E-COMMERCE
Breaking Down the Barriers to Global E-Commerce
Be strategic
Know your audience
Localize
Think globally, act consistently
Value the human touch
Clarify, document, explain
Offer services that reduce trade barriers

21. E-COMMERCE STRATEGY FOR SMALL AND MEDIUM-SIZED ENTERPRISES
E-commerce can be one of the most effective business strategies for small and medium-sized enterprises (SMEs)
The potential for SMEs to expand their markets and compete with larger firms through EC is enormous
Globalization and SMEs
Resources to Support SME Activities in EC

22. THE IMPLEMENTATION LANDSCAPE
The Major Implementation Factors
Justification/Economics
Acquire or Self Develop Your E-Commerce or Social Media Management System
Organizational Readiness and Impacts of E-Commerce
How to Succeed

23. Figure 14.5 The elements in EC and social media implementation

24. DEVELOPMENT STRATEGIES FOR E-COMMERCE AND SOCIAL MEDIA PROJECTS
In-House Development: Insourcing
Insourcing with Applications or Tools
Advantages and Limitations of Software Solutions
Outsourcing Development and Implementation
Selecting a Development Option

25. Factors that Determine E-Commerce and Social Media Success
OPPORTUNITIES FOR SUCCESS IN E-COMMERCE AND SOCIAL MEDIA AND AVOIDING FAILURE
Factors that Determine E-Commerce and Social Media Success
E-Commerce and Social Media Failures
E-Commerce and Social Marketing Effectiveness
E-Commerce and Social Media Successes
Cultural Differences in EC and Social Media Successes and Failures

26. Managerial Issues
What is the strategic value of EC to the organization?
Why do we need an EC and social media planning process?
How do you relate the EC or social media activities to business objectives and metrics?
How can EC and social media go global?
What can small businesses do to remain competitive?
How can we plan for successful implementation?

27. Summary Strategy concepts and competitiveness.
The need for EC and social media justification.
Issues in global EC and social media.
Reasons for EC and social media success and failure.
Small and medium-sized businesses and EC and social media.
The major components of EC and social media implementation.
The major EC and social media development strategies, along with their advantages and disadvantages.