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__Case #1__ Fed Ex and UPS and its leading competitor UPS have many similarities to how they invest in IT. One of the differences is that Fed Ex has always invested in information technology and according to the text, UPS started investing significally recently. Fed Ex’s focus is revenue-generating, customer satisfaction-generating, and strategic advantage technology. Fed Ex invest $1 billion dollars per year in Information technolgy.(43) Fed Ex focuses on innovating more ways to improve service and get greater results while UPS and other competitors usually copy and gives Fed Ex the strategic advantage. UPS only offers tracking for one package at a time. I think that fed Ex has the better strategy because they are trying to make things easier for the customer. The Insight program allows you to view all packages coming to your adress and helps the customer prepare for them. UPS is the bigger company so Fed Ex kinda has a chip on their shoulders. UPS is generally just spending lots of money to copy fed ex strategies to keep up instead of creating better ideas. It sounds to me that UPS is holding on by its name because Fed Ex really seems to be trying to offer the best services. Ups generally focuses on operations instead of quality, the usual problem with bigger companies.

 **Part II**
 * Is FedEx's "move, communicate, and shoot" IT strategy a good one for its competitive battle with UPS? Why or why not? Is it a good model of competitive IT strategy for other types of companies? Defend your position.

 **  FedEx’s , "move, communication, and shoot" strategy does have potential for its competitive battle with UPS. The strategy essentially means that if they don’t move, they will be surpassed by UPS. If comfort sets in at FedEx, and they don’t remain one step ahead of their primary competitor, UPS, then they will lose the battle. As an example, even if FedEx did come out with the recent Insight product that UPS does not have, it does not mean that they can afford to stop research and development of future products. UPS is always lagging slightly but it will not take long for them to catch up or perhaps even come out with a product that steals FedEx’s customers. With that in mind, the innovative employees at FedEx must always strive to be cutting edge in their industry and implement improvements of already existing ideas within the company in order to win their competitor.

Effective communication is essential when implementing new ideas within an organization. Once the idea has been thought of, the first thing that needs to happen is to get feedback in order to assess the feasibility of it. This will address whether or not the idea is possible, cost effective, and how the customers would react to it. Obtaining opinions from various departments that have a variety of experts and also management about the ideas is at the beginning of putting the ideas into motion. Great ideas have been known to be shot down if poorly understood or badly presented do management. This means that without full understanding and support, it will be difficult for the new product or service to be successful or reach its potential in the market.

Finally, "shoot" is an accurate depiction of the last step required when implementing a new products or service that will keep FedEx winning its battle against UPS. Similar to the "move" aspect, if the idea lingers before being implemented, then its possible UPS will have already come out with their own version by the time FedEx has their ducks in a row. For that reason, in this case the best strategy is just to go for it and waste no time. If there is good communication and the idea is well thought out, there’s nothing you can lose by launching the idea in hope to land ahead of your competitor in the race.   A good example of what happens if a large market leader similar to FedEx doesn’t remain at the top of its game in regards to growing its organization and innovating would be the case with the company Seagate. It is a hard disk technology company that recently decided that the best way to progress was to shrink its research and development budgets and turn its focus towards lowering operating costs in order to increase profits. Nevertheless, this drastic change in policy proved to be an unwise one. Its main competitor, Western Digital was focused on improving their products drive capabilities. This allowed for 1TB, 1.5TB and 2TB drives a reality for customers while Seagate watched their success happen from an instant and distant second place with its 500GB and 750GB drives that customers were no longer interested in. After Seagate lost the density race to their competition over this product, Seagate then reevaluated its business strategy. This mistake cost millions in potential revenue all of which the CEO was responsible. AMD also took a similar hit when it was not prepared for the transition to multi-core processors. The same thing happened to ATI when NVIDIA continued to push boundaries on innovation in the high performance graphics industry. However, unlike these examples, FedEx has actively held tight onto the importance of innovation mind frame. This strategy has allowed FedEx to remain in first place and sometimes make significant gains over UPS.

It is a good business vision for FedEx because FedEx is competing with UPS which is a bigger corporation then FedEx. In order to survive in the market you have to keep up with the technology and satisfying the costumers with better service. Nowadays technology is a big issue in the global business which can improve the service of the company and expend the size of the company. According to Carter who is (CIO) Chief Information Officer said “we spend more than 1 billion a year on technology” which has helped the company to grow and improve internationally. So the IT is helping FedEx outspending with this huge budget but still they are not as big as their competitive enemy the UPS which Carter called them the brown guys. FedEx IT system has helped the company to provide a tracking number to the customers to show them where the package actually is, however UPS also has that type of service so FedEx is trying to come up with something new so they cannot be beating in technology and customer satisfaction. In addition FedEx IT system protects the United States and the rest of the world on the war on the terror by scanning the packages and sending some of other suspicious packages.  Discussion # 2 How could a business use information technology to increase switching cost and lock in its customers and suppliers? Use business examples to support your answer When a business uses Cost Leadership Strategy, and Innovation Strategy it may help them to lock in customers. Cost Leadership Strategy can be defined as a way to make your products or services cheaper or somehow keeping the cost cheap for your customers and suppliers. Another strategy would be causing your competitors prices to go up. The use of IT to reduce prices when using an innovation strategy is vital to increase switching cost and locking in its customers and suppliers. Innovation Strategy is defined as [1] finding new ways of doing business. This strategy may involve developing unique products and services or entering unique markets or market niches. It may also involve making radical changes to the business processes for producing or distributing products and services that are so different from the way a business has been conducted that they alter the fundamental structure of an industry. Creating certain strategies for business will ensure a longer relationship with your customers and suppliers. Customers and suppliers may become reluctant from leaving your business because you have an edge over the market. To give an example when Federal Express crated their online package tracking and flight management, it gave customers the opportunity to know where their products were, and when to expect them. If customers become use to this type of service, they may not want to leave because they know that it would be hard to find anywhere else. Investments in a company’s IT can help them to lock in customers and suppliers, which will allow them to create barriers. By building a business relationship with customers and suppliers it will create a loyalty to that business. When a business builds a relationship with customers and suppliers, it may seem impossible to abandon their IT System. Always updating and making little effective changes will also give customers and suppliers a threshold on the IT system, preventing them to find another business because they have Become so use to the IT system that they are using. These IT systems that are created, focuses on improving the quality of service to customers and suppliers and making relationships stronger. By doing this, the Differentiation Strategy is implemented. [2] Developing ways to differentiate a firm’s products and services from its competitors’ or reduce the differentiation advantages of competitors. This strategy may allow a firm to focus its products or services to give it an advantage in particular segments or niches of a market. For example, when Dell Computer created their strategy in cost Leadership, it allowed customers to do online build to order, online seller bidding, and online auctions, which created a Low cost, and it will set a standard for customers competing in the market. Finding different ways to create switching cost in relation to a business and its customers or suppliers will help lock them in. The switching cost creates an inconvenience for customers or suppliers to switch to another firm. Using the example presented in the book, [3] companies have begun to follow Wal-Mart’s example by extending their networks to customers and suppliers and adopting continuous inventory replenishment system that serve to lock in business. These interenterprise information systems use the Internet and other networks to link the business processes of a company electronically with its customers and suppliers, resulting in new business alliances and partnerships. Most business know that people do not like to learn certain things over again. To learn a new system that you are unsure of working better than your old system, could seem like a hassle and an inconvenience.
 * __Case # 3__**

[1] O’Brien pg 47 [2] O’Brien pg 46 [3] O’Brien pg 47

How could a business leverage its investment in information technology to build strategic IT capabilities that serve as a barrier to new entrants into its markets? According to the authors of the introduction to information systems text book, purchasing new and improved information technology acts as a barrier to block or delay the entry of other organizations. The investment would typically help the business maintain and enhance their position within their respective industry. The new information system would improve the efficiency of its current processes. Once a better method of doing regular business is established, the company can begin to offer new products and services that they could not offer before the information technology was incorporated into the business procedures.
 * __Discussion Question #3 __**

Raising barriers to entry would discourage or delay other companies from entering a market when using IT systems. When a company makes investments in information technology, it will help improve its operations and promote innovation to make things easier for customers. Recognizing a higher standard for IT systems in their chosen market will delay or even prevent many companies from entering, due to little investments in their IT system. [1] Typically, these barriers increase the amount of investment or the complexity of the technology required to compete in an industry or a market segment. An example of this is [2] In 1983, Wal-Mart invested in an elaborate satellite network linking the point-of-sale terminals in all of its stores. In a few years, this system grew into a complex communication network that connected all Wal-Mart stores, its headquarters and distribution centers, and all its major suppliers. The most innovative aspect of the system was the facilitation of a modified just-in-time process of inventory control, a feat virtually unheard of in general merchandise retailing. When an Item is sold by a store, a message is immediately sent to the supplier of that item. Having all this set in place will allow any supplier of Wal-Mart to know when they should expect to send another shipment, and the date and time. It was also a lot easier to schedule another shipment, and to know what was not being bought. When any company raises a barrier such as this one, it can be difficult for a company to enter into it, because such an IT system as Wal-Mart had will take a lot of time to develop. A good example of a leverage investment strategy would be for companies to have a strategic plan to utilize the information technology in creative ways. This can be done through focusing specifically on marketing and customer service. A business needs to think at least two steps ahead of the competitor. This is because the gain from a new competitive edge doesn’t last long. When other businesses see that their not offering the same services as their competitors, the service becomes a necessity and the playing field becomes level after the service becomes common practice among all the businesses. If a business is consistent with their investments in information technology, they will continue to appear as pioneers of the creative services that they come to offer. In the gaming industry the slot machines and players club are constantly updated. This would be a prime example of a specific industry. The casinos must stay up to date with the technology and marketing strategies of other casinos. The old slot machines were barely utilizing information technology. Now, the slot machine can keep track of a player’s winnings and how long the player stays during their visit. The slot machines and player’s club cards work hand in hand to offer promotions such as random drawings and gambling incentives. The player’s club was once a new idea, but now it’s a necessity for casinos to offer. Many more information technology uses give casinos a momentary competitive edge, but as I stated before, this is a temporary advantage and will eventually become necessity. (47)

 [1] O’Brien pg 47  [1]    O’Brien pg 46

What strategic role can information play in business process reengineering? As explained in the text book written by O’Brien and Maracas, the process reengineering is aimed at coming up with new ways to improve quality, speed, and service processes of a business which result in a competitive edge in the industry. The authors also explain that reengineering also has risks or potential failure of the strategy. It’s noted that some companies experience failure, but many other businesses have benefited and prospered greatly. Needless to say, new processes in business are critical for organizations to stay afloat. Information technology will undoubtedly continue to play a vital role in the integration of the new ideas and processes that are planned. One of the examples of information technologies supporting ordering processes reengineering that are given by the authors of the text book include customer, product and order status databases accessed via intranets and extranets by the employees and suppliers. This would be useful for large warehouses that have a multitude of employees who are searching for the ordered products in the warehouse. If the information technology wasn’t a major role in this process, the warehouse would be filled with confusion and frustration due to lack of communication within the warehouse. The business would eventually need to reengineer the process of fulfilling the order if they were constantly running into the issue of having more than one employee working on fulfilling the same order when two orders could be fulfilled during the same period. Also, information technology supports the reengineering of a customer accessible websites. For example, Avon, a popular cosmetic company, used to be primarily a door to door sales business. Then Avon went through a reengineering process that involved setting up a website. Now customers can avoid the pressure of sales representatives and order directly from the company in the comfort of their own homes. This also changed the way Avon representatives gain new customers in the area. The new ordering process allowed customers the option of avoiding shipping costs by having a representative deliver the products to them. (p53) <span style="font-family: 'Times New Roman','serif';">
 * __<span style="font-family: 'Times New Roman','serif'; font-size: 12pt; line-height: 115%;">Discussion Question#5 __**

Discussion Question # 6

How can Internet technologies help a business form strategic alliances with its customers, suppliers, and others? Companies can form strategic alliances with customers and suppliers through joint ventures. Many companies do joint adventures to lower cost. In the business world, companies need to stay ahead of the game, or they could find themselves slipping through the cracks of an unprofitable company. In order to do this, companies need to have an Alliance Strategy. An Alliance Strategy is [1] establishing new business linkage and alliances with customers, suppliers, competitors, consultants, and other companies. [2] These linkages may include mergers, acquisitions, joint ventures, forming of “virtual companies,” or other marketing, manufacturing, or distribution agreements between a business and its trading partners. When entering into a joint Venture it will help split the risk of developing an IT system that customers will be able to use. A good example of a joint adventure is Cingular went on a joint venture with SBC and BellSouth. SBC later acquired AT&T so now Cingular is now AT&T wireless. This allows them to keep brand name and customers from both markets and to dominate a market through strategic alliance. Companies can form strategic alliances with customers and suppliers through the forming of Virtual Companies. When you have a Virtual company, it will allow you to work from anywhere on the earth, and you can update your company at anytime, 24/7 and that's a great advantage. You don’t need a showroom, and not having one will cause you to save a lot on overhead cost. One great feature about this that customers and suppliers would like is they don’t have to drive to come find your locations, because you are as close to them as a computer. Take for example Staples Inc. and Partners has an Online one-stop shopping that allows them to increase their market share. It’s also easy for them to communicate, update information, and change part of their site if they chose. This is the key for any company, to be able to change information at their chosen time. Staples Inc and partners has cohesiveness because at anytime of the day, they are able to communicate and update IT because it is only a click away.

Companies can form strategic alliances with customers and suppliers through the forming of Mergers and Acquisitions through IT. Acquisitions and Mergers are strategic Strategy’s that deal with buying and selling or acquiring different companies. Doing this can provide aid, or help a company grow without creating another business. This could also help create a dominant force in the market, and the uses of their IT system can benefit the merger by bring the best of both worlds, creating synergy. Synergy is the force of two, coming together to create one bigger force. For an example, when Verizon wireless decided to purchase Alltel, the company was allowed to acquire their customers, along with their IT systems.

[1] O’Brien pg 47 [2] O’Brien pg 48

Information technology can’t really give a company a strategic advantage, because most competitive advantage don’t last more than a few years and soon become strategic necessities that just raise the stakes of the game. Discuss. The chapter itself begins with a fundamental thought – that technology no longer is an afterthought in forming business strategy, but that it is the actual cause and driver. This idea cannot be stressed any further. The impact IT has had over businesses is common knowledge and is all the more evident from the examples given the chapter. IT quite simply changes the way businesses compete today. It infuses newer blood into the organization by introducing new technologies and strategies as well as business processes which are vital to succeed in today’s dynamic business environment. Advantage comes with newer technology. From FedEx in case one, to the Wal-Mart example later - which adopted the network which linked the point of sale terminals, to even GE in case two - the idea remains the same. Information Technology changes how one does business. IT has been integral in bringing about new products, services and capabilities. Information Technology can improve operations or even promote innovation, thereby deterring other newcomers into the market. It is the very crux of organizational efficiency today. As the world becomes increasingly flat, this can provide a business with a competitive advantage. What it also brings with it though, is the fundamental truth that every technology, no matter what it is, eventually becomes obsolete and has to be replaced. In other words, a business can’t expect to hold on to what it pioneered forever. What Wal-Mart introduced, with its elaborate satellite network linking the point of sale terminals, has now been adopted by others who have put continuous inventory replenishment systems in place themselves. An interesting thought worth mention here is the talk about copying versus innovation between Colvin and Carter in case one. Carter puts it aptly when he states that” it is easier to copy than it is to innovate. The only thing one can do then is to keep moving”. It can be thought of as an inevitable and continual cycle if you may, wherein a business moves from a position of competitive advantage to a position of competitive necessity to ultimately a state of competitive disadvantage with the technology it applies. It can be likened to the product life cycle where after one introduces a new product, it goes from being new and exciting, to a point where it reaches its peak, to where it finally becomes an old and tested product waiting to eventually be phased out. Many even contend that organizations should regulate their technology every two years. An advantage serves its purpose only until it is not understood or has not occurred to a competitor. Once competing firms figure out what and how it is done, they copy it and the advantage is lost forever. It then becomes a standard; a bar which every firm is then expected to be at if it expects to survive. Thus, such advantages are only short lived. The most important thing then is to keep learning, in a manner which is faster than your competitors.
 * __<span style="font-family: 'Times New Roman','serif'; font-size: 12pt; line-height: 115%;">Discussion Question # 9 __**<span style="font-family: 'Times New Roman','serif'; font-size: 12pt; line-height: 115%;">

<span style="font-family: 'Times New Roman','serif'; font-size: 12pt; line-height: 115%;">O’Brien James A., George M. Marakas. Introduction to Information Systems. 4th edition. 2008. McGraw-Hill Irwin. New York, NY.
 * __<span style="font-family: 'Times New Roman','serif'; font-size: 12pt; line-height: 115%;">Source used __**