Term Paper on "Internet Technology (It): Next Five Years"

Term Paper 15 pages (4429 words) Sources: 10

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Wal MartIT

The company chosen on which to conduct a mini case study for this paper is WalMart, and in particular the paper will attempt to concentrate on a number of issues that WalMart recently faced in regards to Information Technology and Systems, and how, if technology had been correctly implemented and used, could have likely saved Wal-Mart a lot of money, profits and a loss of reputation.

The case study will focus on a deciphering exactly what went wrong with Wal-Mart's attempt at expansion into Germany, and what role information systems should have, or did have, in the venture. The paper will also attempt to discern whether the prevailing perception that Wal-Mart owns a competitive advantage, in part due to the information system currently in use, is true. If it is discovered that such perceptions are prevalent then the paper will discuss what will happen to Wal-Mart's competitive edge if that if the system is not continually upgraded and enhanced.

In order to create a mini case study on a company the size of Wal-Mart it would be especially important to understand the exact issue the study should address. An international company the size of Wal-Mart would be an unlikely candidate for such a study if all the issues a company such as Wal-Mart faces on a daily basis were to be addressed in one paper. That is not the case of this particular paper, however, what is the case is that Wal-Mart, the behemoth international retailer, believed that expansion into a foreign market such as Germany would immediately lead the company to achieve the same type of success the company has experienced in the United States.

The decision was fra

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ught with peril, and ultimately Wal-Mart suffered defeat. An article in "The Times" on July 29, 2006 stated the following; "Wal-Mart, the world's largest retailer, abruptly pulled out of Germany yesterday....In a humbling admission of defeat, Wal-Mart said it would sell its 85 German stores to the rival supermarket chain Metro and book a pre-tax loss of about $1 billion on the failed venture." (Wal-Mart, 2006). A $1 billion loss for any company is huge, even if the company is Wal-Mart.

This scenario could likely have been avoided if certain initial strategies and concepts had been discussed, implemented and adhered to from the beginning. The entire situation leading to Wal-Mart's demise in Germany cannot be blamed on the lack of a good information technology system, but certainly a strong and viable system could have alleviated some of the problems experienced by Wal-Mart, and in the end could have been a deciding factor on whether the venture would (in the long run) be profitable or not.

A recent article touts the fact that "the development of E-commerce has revolutionized our way of doing business around the globe" (Victor, Jih, 2006, p. 68). Perhaps Wal-Mart could have foreseen the circumstances leading up to the debacle and changed the direction the company was traveling.

Another expert in the field of business recently stated, "learning how to build stronger relationships with customers is often recommended as a way of ensuring the survival of firms in the face of turbulent or highly competitive market conditions (Webster, 1992, p. 1).

Building relationships with existing clients is only part of the puzzle, but it seems to be a part that Wal-Mart did not take seriously enough in Germany.

Wal-Mart believed that it could buy its way into a market, instill its program on the citizens in that market and then proceed to dominate market share using the same approach, as well as the same technology, the same information systems and the same style of distribution that led to so much success in the United States and other markets.

In 1997-98 Wal-Mart entered Germany, which is the world's third- largest retail market by purchasing two discount retail chains. For $1.6 billion dollars Wal-Mart purchased Wertkauf and Interspar. Interspar was not a very strong retailer as their stores were mostly run down and located in areas that were not that great. Wertkauf, on the other hand, was a profitable chain that was well-known and liked in Germany. A distribution system to deliver product to these stores was already in place, although neither of the chains used an on-time delivery system. What Wal-Mart should have been considering is how to expand its retail business in Germany by using an approach that is both timely, efficient and cost effective, similar to the system currently in use in the U.S., and perhaps initially that is what was intended.

In the states, Wal-Mart epitomizes the excellence of a 'on-time delivery' system that is based on tracking the sale(s) of every solitary item at every single store. That information is then electronically transmitted to a home headquarters location.

From there the information is transmitted to various locations so that the product can automatically be replaced. One expert states however that, "These days, it's a rare company that isn't worried about how to get its products delivered on time. According to a new study, business are finding it harder and harder to meet on-time delivery promises to customers because of obstacles ranging from truck-driver shortages to soaring fuel prices" (Emigh, 2004). The article went on to espouse the fact that many business leaders are making changes in the technology they use in order to alleviate some of those problems. The article related how studies have shown that, "most current users of transportation management applications plan to extend their existing TMS (transportation management systems)" (Emigh, 2004).

It is reasonable to assume that Wal-Mart may have missed an opportunity in Germany by not having the proper system in place to take advantage of the business environment they would encounter there. It is also a fairly reasonable bet that Wal-Mart's competitors are watching as Wal-Mart makes forays into other markets, and most probably cheered the fact that Wal-Mart failed so miserably in Germany.

Many of those competitors are fearful that the competitive advantage that Wal-Mart has so successfully attained in the United States can be extended and enhanced as Wal-Mart grows ever bigger. What the competitors have noticed is that Wal-Mart's competitive advantage is dwindling, and that may give the competitors hope for the future.

Wal-Mart's price advantage is one factor in their growth although one retail-marketing consultant recently reported that, "Key competitors are finding ways to narrow the price gaps enough to render them largely unnoticeable, said Chris Hoyt, a Scottsdale, Ariz., retail-marketing consultant" (Neff, 2007, p. 61). A strong, viable Wal-Mart has been a fact in the business world for a long time, and many of its competitors would love nothing more than a crack in the Wal-Mart armour that could be their opening.

From Wal-Mart's perspective it is likely imperative to discover what went wrong in Germany, what the company could have done to sidestep any mistakes, and perhaps most importantly if implementing any information systems or technology different than what is currently in use could have alleviated any problems or concerns. To discover this information, research will have to be conducted that will allow for analyzing a variety of different factors in order to determine how those factors affected Wal-Mart's objectives and business plan regarding expansion into Germany.

These factors can include a variety of items. As was mentioned earlier, perhaps Wal-Mart was unable to coordinate an 'on-time' delivery system efficient enough to ensure that the most popular selling items were always on hand, or perhaps there were areas that could have been outsourced that were not. A number of companies have been successful in outsourcing services that can be accomplished in a more cost effective way by doing so. Many of these same companies implement a core team concept.

The core team concept has been shown to provide significant savings, reduced downtime, increased production and improved efficiency while maintaining high quality and safety standards" (Maintenance 2007-page 28).

A core team concept allows for a small permanent force to handle all problems on-site, including the integration of outsourcing and the technology required, not only by those outsourcing entities but by the various departments as well. The core team concept can be used to ensure that the it experts all speak the same technological language while at the same time designating responsibility for the different operations. Using a core team concept also alleviates some of the fears that employees face when learning of potential outsourcing, especially since outsourcing has received so much bad publicity in the media as of late.

One expert said that strategically outsourcing other activities "including many traditionally considered integral to any company - for which the firm has neither a critical strategic need nor special capabilities" (Quinn 1995) was a good idea, and it probably is a concept that Wal-Mart could have used in Germany, and may consider in any future ventures.

There is a prevailing perception that outsourcing is a bad thing and therefore it might behoove Wal-Mart to emphasize to their employees the benefits derived (by the employees)… READ MORE

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Quoted Instructions for "Internet Technology (It): Next Five Years" Assignment:

“

Important Notes:

ô€‚™ It is your responsibility to familiarise yourself with the NCC Education Academic

Dishonesty and Plagiarism Policy.

ô€‚™ Any thoughts, ideas or quotations which don*****t belong to you must be fully attributed to their

sources using the appropriate in-text citation and bibliography using the Harvard

Referencing System. Authors***** work that is used in your assignment and not referenced is

plagiarism.

At Diploma level work omitting either citations or bibliography will be limited to a

maximum 50%; at Advanced Diploma level to a maximum 45%; at Honours and PgD

level to a fail.

ô€‚™ You must sign the Student Declaration as detailed in the *****˜Statement and Confirmation of

Own Work***** found at the back of every NCC Education assignment. You must attach the

signed and completed form to your assignment.

ô€‚™ If you gain an unfair advantage or collude in any way whatsoever (other than on joint

assignments) you are liable to be disqualified. Cheating is an offence.

ô€‚™ You could lose marks if you exceed the recommended word count by more than 10%.

ô€‚™ A digital copy as well as a paper copy must be submitted (on disk or similarly acceptable

medium). Media containing viruses, or media which cannot be run directly, will result in a

FAIL grade being awarded for this module. Electronic media will also be checked for

plagiarism so beware!

Award:

Postgraduate Diploma in Strategic Business IT

Module Title:

IT: The Next Five Years

Assignment Title:

Case Study

Examination Cycle:

March 2008

Candidate Name:

NCC Education

Candidate No:

Submission Date:

Marker's comment:

Moderator's comment:

Mark: Moderated Final

Mark: Mark:

IT: The Next Five Years JK March 2008 14/08/2007 Final Â©NCC Education 2007

Important Notes:

ô€‚™ It is your responsibility to familiarise yourself with the NCC Education Academic

Dishonesty and Plagiarism Policy.

ô€‚™ Any thoughts, ideas or quotations which don*****t belong to you must be fully attributed to their

sources using the appropriate in-text citation and bibliography using the Harvard

Referencing System. Authors***** work that is used in your assignment and not referenced is

plagiarism.

At Diploma level work omitting either citations or bibliography will be limited to a

maximum 50%; at Advanced Diploma level to a maximum 45%; at Honours and PgD

level to a fail.

ô€‚™ You must sign the Student Declaration as detailed in the *****˜Statement and Confirmation of

Own Work***** found at the back of every NCC Education assignment. You must attach the

Postgraduate Diploma in Strategic Business IT IT: The Next Five Years

IT: The Next Five Years JK March 2008 6/08/207 Final Â©NCC Education 2007

Introduction

This one assignment within the module will address all of the module*****s learning outcomes. You

are required to address the questions in the four Tasks below that will produce a mini case study

made up of four main sections.

Assignment

You are required to produce a mini strategy case study (between 4750-5000 words) on an

organisation mutually agreed by you and your tutor. The case should be capable of illustrating your

understanding of how the competitive environment and internal capabilities of the company have

combined to influence their IS strategies and development.

Your choice of organisation must also be capable of demonstrating how the use of technology has

related at least in part to the development of competitive advantage. The case should be written in

the style of a mini case similar to those presented in many of the strategy texts.

The mini case must not be just a brief history of the business; instead it must clearly focus on

specific strategic IT/IS issues e.g. competition, changes in customer preferences, increased use of

technology in processes to increase competitiveness, technological innovations, threat of new

entrants to market, outsourcing of activities to improve cost efficiencies *****¦ the list could be endless.

However, you need only to address the most important issues. You are also required to identify

how the external IT/IS environment impacts on the internal workings of the organisation you have

selected.

The following steps should help you in the process of writing the mini case:

Select the organisation or company you wish to write the case on. You are advised strongly to

consider carefully your choice of organisation. Large well-known companies e.g. Mcdonalds,

Coca-Cola, Body Shop, Vodaphone etc*****¦ may be difficult to examine or illustrate with sufficient

clarity in a mini case given their size and complexity, and you would certainly have to narrow this

down to particular Strategic Business Units within the company. Your tutor must agree your choice

of organisation.

Bear in mind that you will need to gather data on the organisation. If the organisation is a large

company, you may want to consider which part of the company, SBU or particular strategic issue(s)

you want the case to explore.

Decide on the specific strategic issues relating to competitiveness the case is going to address. This

should make some reference to external issues or factors and the internal capability of the

organisation. Your case should not require in depth knowledge of the inner workings of the

company, but highlight particular issues of strategic significance. However, remember a mini case

study is NOT simply a description of the company taken from various sources e.g. company web

pages!

Postgraduate Diploma in Strategic Business IT IT: The Next Five Years

IT: The Next Five Years JK March 2008 6/08/207 Final Â©NCC Education 2007

Task 1 - 20 Marks

Context *****“ this will be the first section of the case study. Here, define the aims and scope of your

case study. Briefly critique the method of enquiry you will adopt. Identify any assumptions you will

be making in conducting your research. You may provide some descriptive narrative that gives

brief background information on the organisation and an account of the circumstances or situation

of the organisation. The case might focus on providing a discussion of particular issues, and/or

managerial actions.

Approximately 1000 words.

Task 2 - 25 Marks

In this section, using quality sources of reference provide a summary of external drivers that are

influencing the case under examination to make more use of IT.

You are required to undertake an external environmental analysis of the industry the organisation

operates within; what competitive pressures exist within the industry? How does IT/IS impact their

positioning for competitive advantage? What changes in IT/IS are likely to affect the organisation

in the future? The important point is that analytical tools (e.g. SWOT, PESTEL etc.) are properly

used and included in the appendices. The use of information technology/systems in the sector

should be appraised and possible future technological innovations examined. Ensure all source

material is acknowledged in the case study, including citations within the main body of the text.

Approximately 1500 words.

Task 3 - 30 Marks

The third section, using consequence analysis tools, will provide discussion on the likely impact of

IT/IS on the case under examination. This section should focus attention on the internal resources/

competencies and capabilities of the company; for example, what are they doing that is either

helping or hindering them in the use of IT/IS?

This analysis should be drawn from the *****˜effect/probability/action grids***** (to be included in the

appendices). In this section of the case study, the focus will be on the internal process,

management and strategy of the organisation.

Approximately 1500 words.

Task 4 - 25 Marks

Drawing on the previous two sections, the fourth section of the case study should provide an

overview of key issues that are directly linked to systems development. The aim in this section is to

show how the external and internal environment of the case under examination influences systems

development. Your discussions should focus on the initial stages of the SSM (feasibility, analysis

and design aspects).

Approximately 1000 words.

Format/Requirements of the case study

These sections require you to demonstrate your analytical skills and give justifications for your

answers.

Note: Any models or diagrams you wish to show as supporting analysis or information should be

included in the appendices and does not count in your word count. Clarity and brevity, given the

word count, is important.

You must, of course, provide references for the sources you have used to write the mini case and

commentary using the Harvard referencing system (not included in the word count).

Guidance

Consult with your tutor if you are uncertain about any aspects of the assignment.

Submission Requirements

To pass the assignment candidates must:

*****¢ Complete all the four sections of the case study.

*****¢ Submit their work in a single word-processed document of no more than 5000 words, excluding

appendices.

*****¢ Produce clear and specific reasoning and argument to justify answers.

*****¢ Make appropriate reference to relevant concepts, techniques and theories

*****¢ Appropriately cite all information sources.

*****¢ Include all tools used in the appendices.

*****¢ Provide a reference page.

The document should submitted both in paper form and digital form on a disk.

Warning: All media must be virus free!

Media containing viruses, or media which cannot be run directly, will result in a FAIL grade being

awarded for this module.

All candidates must read and understand NCC Education*****s policy on *****˜Academic Dishonesty

and Plagiarism***** and complete the attached form *****˜Statement and Confirmation of Own

Work*****. You must attach the completed form to your assignment.

*****

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