The effective measurement of SME e-commerce performance in the Western Cape

Abstract

The importance of e-commerce for SMEs has been well established. However, it remains an area of strategic concern amongst organisations across all industries. Furthermore, there is distinct lack of strategic planning in the majority of SMEs. Performance measurement has been identified as an important mechanism for making strategic decisions and it has been suggested that organisations align their strategic planning with their performance measurement systems. However, a large percentage of SMEs have no formal performance measurement systems in place. This has therefore been identified as a potential growth area for SMEs on which the success of the informal sectors depends.Despite the importance of SMEs throughout all economies, to-date limited research has been conducted on SMEs and e-commerce performance measurement. The aim of the present study was to investigate the manner in which the lack of e-commerce performance measurement is influencing the effective management of SMEs in the Western Cape province of South Africa. To achieve this aim, an electronic survey, investigating various aspects of e-commerce performance measurement, was compiled and sent via electronic mail to SMEs of various industries in the Western Cape. A total of 31 SMEs responded. Results indicated that the majority (67.7%) of SMEs in the Western Cape were not currently measuring their e-commerce performance. It was, however, considered highly important to a large percentage of the respondents and 65% of the respondents indicated that they do plan to measure e-commerce performance in the future; however, they need to overcome a number of obstacles to do so. These obstacles were identified and a list of e-commerce performance measurement critical success factors was compiled to guide SMEs in future strategic planning.The present research has proved that SMEs in the Western Cape Province of South Africa are no different from the rest of the world in that they are lagging behind their larger counterparts in terms of e-commerce performance measurement and therefore are lagging behind in terms of strategic concern and the ultimate growth of the organisation is therefore at risk. E-commerce performance measurement is thus an important area that SMEs need to align with their organisations‟ strategy.