E-commerce Quantitative Performance Management Tool - Balanced Score Card (BSC)
GUANGZHOU, China, Oct. 24, 2012 /PRNewswire/ -- Internet-based e-commerce has been developing at an astonishing speed since the turn of the millennium, heavily influencing almost all industries and breeding huge business opportunities. SooBest, lured by these potential opportunities, has invested big in e-commerce to better support the Company's advantages in charm jewelry, women's clothing, men's clothing, and chic watches, hoping to raise its enterprise value and enhance its competitiveness. However, the planning and implementation of an e-commerce strategy is a highly complex system management project. Inevitably, many enterprises, when assessing the implementation of the latent value of the e-commerce strategy will face the same problem as traditional performance evaluations. That is, the intangibility of some potential value makes it hard to quantify evaluations.
An e-commerce strategy must find a proper management tool to help it reach its full potential. The e-commerce BSC, specially designed for e-commerce strategies, departments and projects, is a qualified tool to fulfill this job.
E-commerce does not change the nature of business activities, and it has things in common with traditional business, so we can use BSC to evaluate its performance. However, the platforms where e-commerce is based, and the methods e-commerce deals with are done very differently from that of traditional commerce, which means e-commerce BSC must differ from common enterprise BSC.
E-commerce BSC services a particular department or project and evaluates the service and the performance of e-commerce, and this makes it different from traditional enterprise BSC. If we take a general framework of the latter for reference, and focus on the evaluations and supervision of the specific functions of an e-commerce department/project, then e-commerce BSC also contains four aspects: financial performance, user orientation, internal business and future orientation.
Accordingly, to implement e-commerce BSC, the four aspects play different roles, have different goals and specific indicators respectively. User orientation indicators are used to assess customers who use websites and back office systems and enterprise clients. Financial performance indicators aim to gain the commercial values created by e-commerce investments. The subjects of internal business indicators are the e-commerce processes and applications that provide specific services, and the indicators future orientation indicate personnel and technical resources an e-commerce project needs.
The assessment objectives of financial performance mainly include items to help fit the budget, ensure the completion of the e-commerce strategy, and achieve the commercial value of the e-commerce project.
The assessment objectives of user orientation, on the other hand, mainly contain customer satisfaction, customer retention rate, obtaining new customers, and effective online marketing. In other words, they depict an enterprise's achievements in gaining, keeping customers and in sales volume.
The assessment objectives of internal business mainly cover the completion processes of the business, availability of the e-commerce system, and improvement of system development and security. Internal business, as the name indicates, concentrates on the internal environment of an enterprise. The subject of the completion process of business is the internal operation process that supports the e-commerce project, while the other three objectives oversee the IT process that also supports the e-commerce project.
The assessment objectives of internal business mainly include the professional e-commerce skills of developers, the effectiveness of e-commerce personnel management, dependency on consulting, and the credit of software providers.
Future orientation evaluates an enterprise's ability to make full use of and improve all functions of an e-commerce project both at present and in future. Since this ability mainly relies on the professional skills and experience of IT staff, a series of IT staff-centered measures come into being. The indicators to measure a developer's e-commerce skills include training days, skill level and mastery of the latest e-commerce solutions.
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