Slide 10.1 Dave Chaffey, E-Business and E-Commerce Management, 4 th Edition, © Marketing Insights...

Slide 10.1

Dave Chaffey, E-Business and E-Commerce Management, 4th Edition, © Marketing Insights Limited 2009

Chapter 10

Change management

Slide 10.2


Learning outcomes

• Identify the different types of change that need to managed for e-commerce

• Develop an outline plan for implementing e-commerce change

• Describe alternative approaches to organizational structure resulting from organizational change.

Slide 10.3


Management issues

• What are the success factors in managing change?

• Should we change organizational structure in response to e-business? If so, what are the options?

• How do we manage the human aspects of the implementation of organizational change?

• How do we share knowledge between staff in the light of high staff turnover and rapid changes in market conditions?

Slide 10.4


Key change management issues

• Schedule – what are the suitable stages for introducing change?

• Budget – how much does the e-business cost?

• Resources needed – what type of resources do we need, what are their responsibilities and where do we obtain them?

• Organizational structures – do we need to revise organizational structure?

• Managing the human impact of change – what is the best way to introduce large-scale e-business change to employees?

• Technologies to support e-business change – the role of knowledge management, groupware and intranets are explored

• Risk management approaches to e-business led change

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Figure 10.1 Key factors in achieving change

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Figure 10.2 Digital marketing activities that require management as sell-sidee-commerceSource: Econsultancy(2005)

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Figure 10.2 Digital marketing activities that require management as sell-sidee-commerce (Continued)Source: Econsultancy(2005)

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Table 10.1 The 7S strategic framework and its application to e-business management

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Table 10.1 The 7S strategic framework and its application to e-business management (Continued)

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Table 10.2 Alternative terms for using IS to enhance company performance

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Scale of change

• Hammer and Champy (1993) defined BPR asthe fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in critical, contemporary measures of performance, such as cost, quality, service, and speed

• Fundamental rethinking – re-engineering usually refers to changing of significant business processes such as customer service, sales order processing or manufacturing

• radical redesign – re-engineering is not involved with minor, incremental change or automation of existing ways of working. It involves a complete rethinking about the way business processes operate

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Scale of change (Continued)

• dramatic improvements – the aim of BPR is to achieve improvements measured in tens or hundreds of per cent. With automation of existing processes only single figure improvements may be possible

• critical contemporary measures of performance – this point refers to the importance of measuring how well the processes operate in terms of the four important measures of cost, quality, service and speed

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Figure 10.3 The main challenges of managing sell-side e-commerce(n = 84)Source: Econsultancy (2005)

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Figure 10.4 Challenges of web project management (n = 527)Source: Econsultancy (2007)

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Figure 10.5 Success factors for web project management showing percentage ofrespondents who demonstrate theseSource: Econsultancy (2007)

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Figure 10.6 Stages in developing an e-business solution

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Figure 10.7 An example web site development schedule

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Figure 10.8 Typical structure and responsibilities for a large e-commerce teamSource: Econsultancy (2005)

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Figure 10.9 Summary of alternative organizational structures for e-commercesuggested in Parsons et al. (1996)

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Figure 10.10 Options for location of control of e-commerceSource: Econsultancy (2005)

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Figure 10.10 Options for location of control of e-commerce (Continued)Source: Econsultancy (2005)

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Table 10.5 Facilitating organizational change through a transition modelSource: The middle column is based on a summary of the commentary in Hayes (2002)

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Table 10.5 Facilitating organizational change through a transition model (Continued)Source: The middle column is based on a summary of the commentary in Hayes (2002)

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Knowledge managementSaunders (2000)

Every day, knowledge essential to your business walks out of your door, and much of it never comes back. Employees leave, customers come and go and their knowledge leaves with them. This information drain costs you time, money and customers

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Knowledge management

What is knowledge?

• Ref. The top paragraph on p. 591. Do you agree to this definition?

• What’s difference between data, information, and knowledge?

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Figure 10.11 Knowledge management framework

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IDC – objectives of KM

• Improving profit/growing revenue (67%)• Retaining key talent/expertise (54%)• Increasing customer retention and/or

satisfaction (52%)• Defending market share against new entrants

(44%)• Gaining faster time to market with products

(39%)• Penetrating new market segments (39%)• Reducing costs (38%)• Developing new products/services (35%)

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Differences between knowledge management, data processing and information management

• Consider a retail manager analyzing their sales figures

• Raw data on sales figures consist of figures in each individual store for a given month. IS can present this data within the context of sales compared to previous months as information

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Differences between knowledge management, data processing and information management (Continued)

• This information is of little value if the manager does not know how to act in response to it. Managers apply their knowledge to decide how to respond if the sales in one region are much lower than others, or if one store is underperforming against budget

• Thus, knowledge is the processing of information and is a skill based on previous understanding, procedures and experience

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Explicit and tacit knowledge

• Knowledge management – Techniques and tools for capturing and disseminating knowledge within an organization

• Explicit – details of processes and procedures. Explicit knowledge can be readily detailed in procedural manuals and databases. Examples include records of meetings between sales representatives and key customers, procedures for dealing with customer service queries and management reporting processes

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Explicit and tacit knowledge (Continued)

• Tacit – less tangible than explicit knowledge, this is experience on how to react to a situation when many different variables are involved. It is more difficult to encapsulate this knowledge, which often resides in the heads of employees

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Implementing KM

• It is impossible to achieve full benefits from knowledge management unless individuals are willing and motivated to share their knowledge or unless organizations lose their structural rigidity to permit information and knowledge flow (IDC, 2000)

• Knowledge can only be volunteered – it cannot be conscripted (Snowden, 2002)

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Binney – classes of KM applications

1. Transactional. Help desk and customer service applications

2. Analytical. Data warehousing and data mining for CRM applications

3. Asset management. Document and content management

4. Process support. TQM, benchmarketing,BPR

5. Developmental. Enhancing staff skills, competencies – training and e-learning

6. Innovation and creation. Communities, collaboration and virtual teamwork

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Tools for KM

• Many tools are available for different types of activities in KM

• Intranet• Web and Web 2.0

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Risk management

1. Identify risks including their probabilities and impacts

2. Identify possible solutions to these risks

3. Implement the solutions targeting the highest impact, most likely risks

4. Monitor the risks to learn for future risk assessment

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Activity – identify risks for e-business project

Risk Probability Impact Solution

Insufficient senior management commitment

5 7 Education/training/lobbying by e-business manager to achieve buy-in

High staff turnover/key staff leave

6 5 Use monetary incentives and improve working environment

Project milestones not met, overrun budget

8 6 Appoint experienced project manager and provide support and resources needed. Manager will perform risk management such as this

Problems with new technology delaying implementation (bugs, speed, compatibility)

8 8 Allow sufficient time for volume, performance testing

Staff resistance to change 4 4 Education, training identification of change facilitators amongst staff

Problem with integrating with partner’s systems (e.g. customers or suppliers)

6 8 Tackle these issues early on, identify one contact point/manager for each of the partnerships

New system fails after changeover (too slow or too many crashes)

9 See solution to delayed implementation

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Table 10.6 Organizational risk exposure factors

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Case Study

Read the Case Study 10.2 on pp. 596-598 and be prepared to discuss the questions on page 598

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