2012
Homework Spring No. 1 Guideline
This is a solution guide; in certain cases it may not show the complete details, and in certain
cases there can be other answers which are also correct.
(2) Answer and submit (via BB) your answers to the following questions:
a) Read about types of information systems and about strategic information systems for organizations.
(i) Explain briefly five methods by which IT can support the organizations strategy.
1- Cost Leadership Strategy: IT can enable corporations to save on multiple costs, such as transport
costs for products. If an IT system in a store can be linked to the point of sale terminal, it can record
number of sales made and tally it with the number of products left to be sold. That would give
inventory managers exact knowledge of when a new batch or stock of product is to be ordered,
instead of calling for it despite having stocks.
2- Differentiation Strategy: IT can allow a company to distinguish itself from competitors and others
in the market. For example, Vons Grocery Store delivers groceries at customers door step and people
find it very convenient to place orders on the internet instead of taking the trouble to come to the
store. Customers appreciate the additional facility.
3- Innovation Strategy: Adding existing features to the set of products and services a company
offers can often be an effective strategy. For example, IT enables Sports Companys like WILSON to
display their product details and pricing online. Customers can view their desired product and its
specification sitting at home. It saves them time and efforts, it also requires the company to hire less
sales representatives.
4- Operational effectiveness Strategy: This improves the manner in which internal business
processes are carried out and contribute to the overall efficiency in one manner or the other be it
productivity or better quality. The simple transition of drafting in opposition to usage of CAD can be
taken. If an architecture firm drafts its floor plans it consumes a lot of time and caters to less
customers. Whereas if CAD is used, greater accuracy is enjoyed and simultaneously a greater market
share is earned by serving more customers.
5- Customer Orientation Strategy: making the customers Happy. Quite a few companies have online
surveys and customer feedback forms on their websites which allow customers to express themselves,
be it opinions, suggestions or complaints regarding products or services. This greatly helps the
company improve but also gives the customer a sense of importance. Needless to mention that it can
only be done through use of IT.
(ii) Illustrate some of these methods as applicable specifically for the case of an organization such as
Santa Cruz Bicycles (pp. 31-3).
As in the case of Santa Cruz Cycles, I would like to point out the applicability of two strategies in
particular.
Spring 2012
1 The Operational effectiveness Strategy: Taking on and adapting to the use of better simulation
and CAM software, product specifications were much Improved and adjustments were also made
without causing trouble and time delays to other functional areas in the business. This change in IT
could have also opened gateways to customized production services.
2- Differentiation Strategy: No one in the market currently offered this sort of a distinguishe d product
with an efficient suspension system, although the idea was previously pioneered by a bicycle
company, greater accuracy and mass production of a unique range of bicycles enabled by efficient
simulation software would distinguish Santa Cruz Bicycles from all other companies in the market.
They would build themselves an identity based on the unique feature of their product.
(iii) In the case of Santa Cruz Bicycles, explain the problems and their IT solutions.
In the specific case of Santa Cruz Bicycles, they experienced several problems. First of all, it took far
too long to render new designs, even with using computer-aided design software. Secondly, it took
even more time to have parts machined by outside shops, making the full design-to-prototype
sequence take about 7 months of design.
To improve this, the company used two important IT solutions. The first was selecting a Product
Lifecycle Management (PLM) software package, which provided them with more powerful analysis
and modeling capabilities. It allowed computer testing of certain parts, as well as stress analysis to
figure out the points most likely to fail on the bike. The second was the purchase of a rapidprototyping Haas Automatic Toolroom Mill, which allowed the company to do a large portion of
prototype fabrication by themselves.
These two IT solutions helped to reduce the time from design to shipping from 28 months, to around
12-14 months, an 50% decrease.
(iv) List the basic components of an information system in a table (see example below), and
identify which of them is (are) applied in each of the solutions you explained in (iii).
SANTA CRUZ BICYCLES
INFORMATION SYSTEM COMPONENT APPLIED
Problem
Solution
Hardware
Software
Network
Procedures
People
Dissatisfactory
Company
Growth
Differentiation
strategy;
Purchasing a
software for
product
development
Simulation and
modeling
software
Yes ; used
to run and
operate the
new
software
Yes
Yes ; used to
share the
work done
on software
To an extent ;
procedures
were used to
operate
software
Yes ;The
software
adapted was
run by
people
Yes ; used
to view
modeling
and
simulations
Yes
Used to
share and
pass on
instruction
regarding
product
The procedure
of
manufacturing
bicycles was
conveyed with
use of IT
People
operated the
software.
Product design
wasnt
successful
Spring 2012
design
Need areas
Enterprise
resource
planning for
communication
among
functional ( or
other software
enabling
sharing)
#
Problem
Solution
1
Defective
frame
2
Long
producing
time and
high cost
Pro/Engineer 3D
to model factors
and use color
graph to improve
the research and
development
process.
Haas Automation
Tool-room Mill
Yes ; used
to view
shared files
and
documents
Yes ;
software
enables
exchange of
information
between
business
units
1:Hardware&Soft
ware
Yes, this is a
software and it
needs to work on
a computer, that is
a hardware.
Yes, this
manufacturing
machine also
needs an operating
system to control.
Used to
share and
pass on
instructions
and
feedback
Included and
applied.
People use
the software
and upload
information
for
exchanging
purposes
2:Network
3:Procedures
4:People
Yes, this design
system would
share the
information with
other
department of
the company,
Yes, it will be
connected to the
company's
control center.
Yes, there will
be different
steps before
they get the
final design.
Yes, this software
is not automatic,
there should be
engineers to
operate.
Yes, there will
be different
steps to
manufacture a
bicycle part.
As users and
supervisers.
b) Enter the web-site of UPS (www.ups.com) and
(i) describe the package tracking functions;
Several package tracking functions exist throughout UPS. Options to track by number or InfoNotice
number, by entering up to 25 tracking numbers, as well as tracking by reference, which is where a
person can track by destination country and zip code as well as shipment type and shipper account.
There is also an option to track by e-mail, accessed by sending up to 25 of a persons tracking numbers
in an e-mail message to [e-mail]. There is an option to import tracking numbers as well as
tracking by SMS.
(ii) compute the cost of shipping a 10X25X30 box weighing 26 Lbs. from your hometown to Purdue;
Spring 2012
(iii) what were UPS objectives in providing these functions?
The package tracking system serves multiple objectives and can be looked upon as a management
information system. Firstly it is a convenience and an additional facility offered to customer by which
they can keep track of their packages and whether or not they have been received. UPS employees
can focus on other important work rather than answering customer queries regarding their package
status. Customers feel safer choosing UPS because of this facility offered. It helps in organization of
data and reduces human effort.
Similarly the online pricing system is similar to an electronic commerce system. It enables customers
to enjoy the facility of obtaining price quotes sitting at home or work. This reduces time and effort
UPS employees and customers can help themselves. As a result UPS requires less employees to
attend to customers. It helps customers make decisions themselves. It also assists employees in
processing transactions and giving price quotations at sale centers.
c) Identify and briefly explain for each of the following cases the type (or types) of information support it
involves:
Spring 2012
(i) Checkout at a department store point-of-sale: this requires a transaction processing system that is
able to send data and transport data in a business. This means that data from the counter is sent to the
store to see which things are being bought. This also uses a little management information system
because it shows the customers how much data they have, which means how much they have bought
in total.
(ii) CAD system: A computer aided design system uses many information support systems such as
application programs that are computer programs that help support a specific task. Also, a CAD also
requires the components of an IS (hardware, software, database, network, procedures, and people). A
CAD system also uses dashboards to manage an organization as well as Business intelligence
systems that are computer-based that help make decisions for the workers. The CAD system also
uses expert systems which help duplicate the work of experts and by this use it in computers and
designs.
(iii) Assembly robot in a factory: this use computer aided design systems to develop the product in a
well manner; expert system to mimic human expertise in constructing and assembling a robot;
electronic commerce system to buy the supplies needed to construct the robot in the factory.
(iv) Porters value chain model: this uses many specific systems such as automated warehousing
systems, which are used to control quality; computer-controlled machining systems, which are used
for packaging and production control; automated scheduling systems, which help dispatch and
deliver products; computerized ordering systems, which help with the management of customers and
the taking of orders and creating promotions; customer relationship management systems, which
help with maintenance and education, and many more systems that involve the production and
service of a company and the information systems that accompany it.
(v) BlackBoard: this does require various information support systems. In a way, BlackBoard uses a
transaction processing system to monitor, collect and storage data from different classes available to
teachers and the students that take the class. In another way, BlackBoard requires Dashboards and
business intelligence systems because the dashboards somehow allow direct aces to information
(such as homework to students) and business intelligence system is also shown in a way because it
allows a person to perform their own data analysis. This can be observed as a student downloading
data and uploading homework (in this example the homework can be observed as the data analysis).