Difficulties in Measuring and Justifying EC Investments Difficulties in Measuring costs and benefits Tangible Costs and Benefits-are those that are easy to measure and quantify and that relate directly to a specific investment Intangible Costs and Benefits Costs may involve having to change or adapt other business processes or information systems Intangible benefits include faster time-to-market, increased employee and customer satisfaction, easier distribution, greater organizational agility, and improved control Electronic Commerc Prentice Hall 2006
Electronic Commerce Prentice Hall © 2006 16 Difficulties in Measuring and Justifying EC Investments • Difficulties in Measuring Costs and Benefits – Tangible Costs and Benefits—are those that are easy to measure and quantify and that relate directly to a specific investment – Intangible Costs and Benefits • Costs may involve having to change or adapt other business processes or information systems • Intangible benefits include faster time-to-market, increased employee and customer satisfaction, easier distribution, greater organizational agility, and improved control
Difficulties in Measuring and Justifying EC Investments Handling Intangible benefits The most straightforward solution to the problem of evaluating intangible benefits in cost-benefit analysis is to make rough estimates of the monetary values of all of the intangible benefits and then conduct a Rol or similar financial analysis Electronic Commerc Prentice Hall 2006
Electronic Commerce Prentice Hall © 2006 17 Difficulties in Measuring and Justifying EC Investments – Handling Intangible Benefits • The most straightforward solution to the problem of evaluating intangible benefits in cost-benefit analysis is to make rough estimates of the monetary values of all of the intangible benefits and then conduct a ROI or similar financial analysis