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Chapter 5 E-business strategy 297

For ‘viability’ the metrics are:
Market value potential (return on investment)
Time to positive cash flow
Personnel requirement
Funding requirement.
Econsultancy (2008a) also recommends a form of portfolio analysis (Figure 5.17) as the
basis for benchmarking current e-commerce capabilities and identifying strategic priorities.
The six criteria used for organizational value and fit (together with a score or rating for their
relative effectiveness) are:
Business value generated (0–50). These should be based on incremental financial benefits of
the project. These can be based on conversion models showing estimated changes in
number of visitors attracted (new and repeat customers), conversion rates and results
produced. Consideration of lifetime value should occur here.
Customer value generated (0–20). This is a ‘softer’ measure which assesses the impact of the
delivered project on customer sentiment, for example, would they be more or less likely to
recommend a site, would it increase their likelihood to visit or buy again?
Alignment with business strategy (0–10). Projects which directly support current business
goals should be given additional weighting.
Alignment with digital strategy (0–10). Likewise for digital strategy.
Alignment with brand values (0–10). And for brand values.
The cost elements for potential e-business projects are based on requirements for internal
people resource (cost/time), agency resource (cost/time), set-up costs and technical feasibil-
ity, ongoing costs and business and implementation risks.

P3. Medium
priority: P1. High priority:
Internal people resource (cost/time) (0-20) High Reduce scope Implement
viability or defer
Agency resource (cost/time) (0-20)
Set-up costs and technical feasibility (0-20)
Ongoing costs (0-20) Resourcing P2. Medium
P4. Low priority: priority:
Business & implementation risks (0-20) Low Don’t implement Reduce scope
or defer or defer

Low High
Organizational value and fit
Business value generated (0-50)
Customer value generated (0-20)

Alignment with business strategy (0-10)
Alignment with digital strategy (0-10)
Alignment with brand values (0-10)

Matrix for evaluating e-business strategy alternatives
Figure 5.17
Source: Econsultancy (2008a)