Explain tangible costs and benefits. Explain intangible costs and benefits

Question

What will be an ideal response?

Answer 1

Tangible costs are those that are easy to measure and quantify and that relate directly to a specific investment. The costs involved in purchasing hardware, software, consulting, and support services usually are tangible, as are labor costs. These costs can be measured through accounting information. Tangible benefits are direct benefits such as increased profitability, improved productivity, and greater market share, and can be measured with relative ease. Intangible costs are indirect costs that may include the learning curve of the firm's customer service employees to incorporate an EC system to respond to customer inquiries. Another intangible cost may involve having to adapt other business processes or information systems, such as processing items returned by customers or building and operating an inventory tracking system. In many cases, EC projects generate intangible benefits, such as faster time-to-market, increased employee and customer satisfaction, easier distribution, greater organizational agility, and improved control. These are very desirable benefits, but it is difficult to place an accurate monetary value on them.