Performance Measurement In The eCommerce Industry

Abstract

The Balanced Scorecard framework (BSC) developed by Kaplan and Norton (1992) has been widely accepted by most academics and adopted by numerous practitioners in industry. Despite being widely accepted by practitioners in industry, little extant research has focused on the BSC and little empirical analysis has focused on validating the model. This paper first develops performance measures specifically designed for the eCommerce industry by drawing on the BSC and other measures developed by practitioners. Next, the paper reports evidence of the utility of the BSC framework in measuring and monitoring the performance of e-commerce companies. The study utilizes an integrated Data Envelopment Analysis (DEA) model to examine and evaluate the relative efficiency of the measures identified within the BSC framework for measuring the performance of eCommerce companies. Finally, the study examines the effectiveness of the BSC framework in predicting the success or failure of eCommerce companies by focusing on three successful eCommerce and three eCommerce companies that subsequently failed.