EVALUATING THE COST-BENEFITS OF E-GOVERNMENT PROJECTS: Rationale for Going beyond Objective Financial Measures

Year 2011, Volume: 3 Issue: 1, 109 - 119, 01.06.2011

Muhajir Kachwamba Iddi Makombe

Abstract

The assertion that e-government has myriad benefits exists in the plethora of egovernment literature. However, the fact that e-government implementation is costly can not be ignored too. In order to match the two, there have been efforts to suggest models from which the costs and benefits of e-government projects could be assessed to justify their implementation. Since Project Management profession has a unique role for the successful implementation of e-government projects; models for project evaluation in Project Management are also relevant for evaluating e-government projects. Hence, financial measures of project evaluation such as Net Present Value (NPV), Payback period and Cost-Benefit ratio are normally recommended for evaluating e-government projects. We argue however that though financial models are important objective measures, they are maligned in the following grounds. Firstly, while cash flow is a requisite data input for computation of financial measures; not all e-government project benefits can be measured in monetary values. Secondly, not all e-government projects are aiming at profit maximization. Thirdly, the benefits of e-government projects can not be assessed within a single domain because of multiplier effect to other social, political and economic entities. In this paper, authors provide a framework which indicates the broad benefits of e-government in which financial models have limitations in evaluating such e-government projects. A multi-weighted score technique is recommended as a subjective measure to complement financial models in order to nurture those broad benefits of e-government projects during the early phases of selecting viable projects

Keywords

Net Present Value, Payback Period, Multiplier Effect, Egovernment, Multi-Weighted Score

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