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Implementing eBusiness without tech-savy employees Conclusion

Contrasting approaches to a shortage of tech-savvy staff are shown in the table below. This table was referenced in an earlier lesson.
Approach Goal Success factors
Internal Specialist eBusiness unit Educate the existing business Transfer its knowledge and ultimately its resources to the business-as-usual areas over a finite period Expect that the new unit will have a tendency to delay its ultimate demise Clearly establish the principle of transfer at the outset Ensure that the transfer is understood by all concerned
External separate eBusiness unit Grow the business as a separate unit, to promote the unit as a separate business Initiate a possible eventual separation from the parent group Ensure that the existing business recognizes this split of responsibilities Anticipate and avoid later duplication of effort and cost

Ecommerce Business Model

E-business Solution Cost and Benefit Estimation

The primary means of mitigating risk is to allocate more time and skilled resources to advanced preparation and planning in the initial stages of the project. This requires the expenditure of additional labor and its associated costs in an accelerated delivery and budget conscious environment. Many firms resist these initial phase investments and accordingly, many projects fail to reach their full potential. Those organizations that fail to recognize the potential complexity of an e-business solution deployment and the need for additional planning to support it almost always incur unanticipated costs while they learn to integrate and subsequently use these systems in daily operations.
Even with the capable tools to supplement their estimating efforts, many firms simply do not accurately perform cost and benefit analyses nor do they interpret the resulting data correctly. Jupiter Research reports that most firms that perform ROI analysis on their IT projects do so with staffs that provide either an inherent bias to their analysis or that have not been properly trained to fully recognize the many aspects of this type of analysis Staffed assigned from the Information Technology departments to perform an analysis may understand the technical details of their projects but seldom have access to information regarding the financial impacts of their projects on the company. Conversely, finance and accounting departments can determine the impacts of the expended costs and perform detailed "historical evaluations" of a project if the needed data is collected but seldom have complete or sufficient data for accurate ex ante evaluations. The key mitigation of this potential failing is training individuals in the use of the tools and methodologies that are provided to them for estimating purposes. This includes estimate preparation as well as simulation output interpretation.
The process that facilitates the collection of estimates must recognize that both the benefits and the costs contain many tangible and intangible elements. The detailed quantification of those elements is often difficult to accomplish. Intangible costs[1] or benefits should be considered carefully before they are included as quantified values within a simulation. E-business solution analysis requires the creation of a simulation that reflects an organization’s approach to business, the quantification of many variables, both known and estimated, and a use methodology that provides consistent valuations between solutions.
[1]Intangible costs:An intangible cost is a cost that can be identified but cannot be quantified or easily estimated. Common intangible costs include loss of employee morale or brand damage. While directly measurable, intangible costs can have a very real impact on a company's bottom line.