Risk management systems for e-commerce development

Abstract

Risk analysis has been widely used and applied in the context of financial and engineering problems, but not much to the development of electronic commerce (EC). This study identifies the potential risks associated with EC development. A classification framework to categorize the various sources of risk associated with EC development was proposed. An empirical study was conducted and a principal component analysis of the survey data reveals ten major dimensions of risk associated with EC development, namely (1) resource risk, (2) vendor's quality risk, (3) requirements risk, (4) client-server security, (5) legal risk, (6) managerial risk, (7) outsourcing risk, (8) physical security risk, (9) cultural risk, and (10) reengineering risk. The results empirically validated the proposed classification framework of potential risks to EC development. Based on the classification framework, a risk analysis model for EC development using fuzzy set was proposed. A web-based prototype fuzzy decision support system (FDSS) was designed and developed to incorporate the proposed risk analysis model that support risk assessment in EC development. The results of the prototype evaluation are satisfactory and support the contention that the prototype has performed its function as expected.