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Chapter 10 E-commerce: Digital Markets, Digital Goods 435

consult books devoted to just this topic (Laudon and Traver, 2013). The two
most important management challenges in building a successful e-commerce
presence are (1) developing a clear understanding of your business objec-
tives and (2) knowing how to choose the right technology to achieve those
objectives.

PIECES OF THE SITE-BUILDING PUZZLE

Let’s assume you are a manager for a medium-sized, industrial parts firm of
around 10,000 employees worldwide, operating in eight countries in Europe,
Asia, and North America. Senior management has given you a budget of $1
million to build an e-commerce site within one year. The purpose of this site
will be to sell and service the firm’s 20,000 customers, who are mostly small
machine and metal fabricating shops around the world. Where do you start?
First, you must be aware of the main areas where you will need to make
decisions. On the organizational and human resources fronts, you will have to
bring together a team of individuals who possess the skill sets needed to build
and manage a successful e-commerce site. This team will make the key deci-
sions about technology, site design, and social and information policies that
will be applied at your site. The entire site development effort must be closely
managed if you hope to avoid the disasters that have occurred at some firms.
You will also need to make decisions about your site’s hardware, software,
and telecommunications infrastructure. The demands of your customers
should drive your choices of technology. Your customers will want tech-
nology that enables them to find what they want easily, view the product,
purchase the product, and then receive the product from your warehouses
quickly. You will also have to carefully consider your site’s design. Once you
have identified the key decision areas, you will need to think about a plan
for the project.

BUSINESS OBJECTIVES, SYSTEM FUNCTIONALITY, AND
INFORMATION REQUIREMENTS

You need to answer this question when planning your Web site: “What do we
want the e-commerce site to do for our business?” The key lesson to be learned
here is to let the business decisions drive the technology, not the reverse. This
will ensure that your technology platform is aligned with your business. We
will assume that you have identified a business strategy and chosen a business
model to achieve your strategic objectives. But how do you translate your
strategies, business models, and ideas into a working e-commerce site?
Your planning should identify the specific business objectives for your site,
and then you must develop a list of system functionalities and information
requirements. Business objectives are simply capabilities you want your site to
have. System functionalities are types of information systems capabilities you
will need to achieve your business objectives. The information requirements
for a system are the information elements that the system must produce in
order to achieve the business objectives.
Table 10.8 describes some basic business objectives, system functionalities,
and information requirements for a typical e-commerce site. The objectives
must be translated into a description of system functionalities and ultimately
into a set of precise information requirements. The specific information require-
ments for a system typically are defined in much greater detail than Table 10.8

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