Objectives of knowledge management

Cost/efficiency drivers
1 
Increasing speed with which supplies can be obtained
2 
Increasing speed with which goods can be dispatched
3 
Reduced sales and purchasing costs
4 
Reduced operating costs
Competitiveness drivers
5 
Customer demand
6 
Improving the range and quality of services offered
7 
Avoiding losing market share to businesses already using e-commerce
More recently, in interviews with Australian businesses, Perrott (2005) identifies four key 
areas driving performance: cost– benefit, competitive pressures, market advantage and value- 
adding, i.e. improving customer satisfaction while building strong relationships.
When reviewing potential benefits, it is useful to identify both tangible benefits (for which 
monetary savings or revenues can be identified) and intangible benefits (for which it is 
more difficult to calculate cost savings). The types of potential benefits are summarised in 
Table 1.2.
Doherty 
et al
. (2003) researched the drivers and barriers to retailers’ adoption of Internet 
technologies to determine the most important factors. Table 1.3 summarises the rank-
ing in importance for different degrees of Internet adoption from static 
brochureware 
(A), 
through an active website containing product information (B) to a transactional site where 
items can be purchased (C). You can see that the two most important factors which corre-
late with adoption are ‘Internet target segment’, i.e. customers in their market are typically 
adopters of the Internet, and ‘Internet strategy’, i.e. a defined Internet strategy is in place. 
This suggests, as would be expected, that companies that do not have a coherent Internet or 
digital business strategy are less likely to use higher levels of Internet services. Many larger 
organisations that have responded to the challenge of digital business have created a separate 
Brochureware
Brochureware describes 
a website to which a 
company has migrated 
its existing paper‑ based 
promotional literature 
without recognising the 
differences required by 
this medium.
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Chapter 1
Introduction to digital business and e‑commerce
e-commerce plan and separate resources to implement it. This book covers what needs to go 
into such a plan and the issues to consider when implementing it.
Case study 1.2 illustrates the benefits of setting up an online operation for an SME. It also 
highlights some of the challenges of managing an online business and highlights the need for 
continued investment to refine online services and the marketing needed to attract visitors 
to the website.
Table 1.2
Tangible and intangible benefits from e‑commerce and digital business