You have been asked to design and install an information system for medium-size

Question

You have been asked to design and install an information system for medium-size toy making organization with 150 employees. The organization is departmentalized into Finance and Accounting, Human Resource, Sales and Marketing, Production, Research and Development. Provide an appropriate solutions to these problems:

a. For the effective running of the organization, what various functions would your information system perfrom?(4 marks)
b. Breifly explain how you would design your Customer Relationship Management function of your information system and state your value proposition for this function.(8 marks)
c. Consider an organization's mediating factors in its relationship with technology and explain (in no less than a page) how you would mitigate conflict between the organization and your information system(6 marks).
d. Supposing you were to pitch an idea to include online sales as part of your IS package, what unique features/advantages od e-commerce would you employ to convince the organization to build an e-commerce website? (8 marks)
e. Explain how transaction cost would be reduced for both the organization and their customers by introducing e-commerce.(4 marks)

Explanation / Answer

a).For effective running of the organisation we will employ a management information system(MIS) to store records of all the employees and also the customers who will be ordering the toys. It will also include the transaction processing when the customer will pay for products online. The following are the functions:

Management information system, produce fixed, regularly scheduled reports based on data extracted and summarized from the firm’s underlying transaction processing systemsto middle and operational level managers to identify and inform structured and semi-structured decision problems.

b) The customer relation management system that will be eomployed will perform the following functions:

The idea of CRM is that it helps businesses use technology and human resources to gain insight into the behavior of customers and the value of those customers. With an effective CRM strategy, a business can increase revenues by:

The type of CRM to be employed will include an E-CRM(electronic ) web based so that transactions can take place online along with orders,payments and dispatchments can be done in the shortest time possible.

As the internet is becoming more and more important in business life, many companies consider it as an opportunity to reduce customer-service costs, tighten customer relationships and most important, further personalize marketing messages and enable mass customization.

Today's customers are a fast-moving, demanding crowd. They are looking for products and services that are proven yet innovative. They want information at their fingertips. With the right CRM solutions in place, we can help organizations to build and nurture lasting one-on-one relationships with customers. Thus, it enhances the business efficiencies and profitability.

Different levels of eCRM

In defining the scope of eCRM, three different levels can be distinguished:

Foundational services

This includes the minimum necessary services such as web site effectiveness and responsiveness as well as order fulfillment.

Customer-centered services

These services include order tracking, product configuration and customization as well as security/trust.

Value-added services

These are extra services such as online auctions and online training and education.

Self-services are becoming increasingly important in CRM activities. The rise of the Internet and eCRM has boosted the options for self-service activities. A critical success factor is the integration of such activities into traditional channels. CRM activities are mainly of two different types.

Reactive service is where the customer has a problem and contacts the company.

Proactive service is where the manager has decided not to wait for the customer to contact the firm, but to be aggressive and contact the customer himself in order to establish a dialogue and solve problems.

We can include all the above services in our E-CRM.

c)Conflicts can arise in a company due to changing needs of softwares and the employees maybe reduced depending on the growth of business. As a result information system may require some changes or updates or maybe a complete change depending on the conditions since conflict can arise between organization and the performance of the current information system.

1) Employees should discuss the matter about the latest technologies to promote more orders and at the best prices and if the information system is lacking then maybe upgrade it .

2) If some employees are unhappy with the sales reports and the automation processes then they should have a meeting with the Ceo and try to find a solution regarding how to automate in the best possible way. Sometimes a few changes to softwares of system can help in increasing and making the business better.

3) Talking and listening to each other is important for employyes. Approaches like many to one can be applied.Just like ebay does .It handles many customers simultaneously and performs transactions and taking orders.

4)If the information is too slow with very poor outputs then a trained software profession should be hired to design the information system and replace the existing one.

5)The best way is to either to make the system better by working on it and not complaining about it and hiring better people to create the change and making this possible.

d) The following advantages would be employed to build an e-commerce website:

Advantages to Organizations

Using E-Commerce, organization can expand their market to national and international markets with minimum capital investment. An organization can easily locate more customers, best suppliers and suitable business partners across the globe.

E-Commerce helps organization to reduce the cost to create process, distribute, retrieve and manage the paper based information by digitizing the information.

E-commerce improves the brand image of the company.

E-commerce helps organization to provide better customer services.

E-Commerce helps to simplify the business processes and make them faster and efficient.

E-Commerce reduces paper work a lot.

E-Commerce increased the productivity of the organization. It supports "pull" type supply management. In "pull" type supply management, a business process starts when a request comes from a customer and it uses just-in-time manufacturing way.

Advantages to Customers

e)Transaction cost will be reduced by ecommerce in the following ways:

1)Reduced Customer Costs

24x7 support. Customer can do transactions for the product or enquiry about any product/services provided by a company any time, any where from any location. Here 24x7 refers to 24 hours of each seven days of a week.

E-Commerce application provides user more options and quicker delivery of products.

E-Commerce application provides user more options to compare and select the cheaper and better option.

A customer can put review comments about a product and can see what others are buying or see the review comments of other customers before making a final buy.

E-Commerce provides option of virtual auctions.

Readily available information. A customer can see the relevant detailed information within seconds rather than waiting for days or weeks.

E-commerce transactions make shopping cheap and easy for the customer, which can increase your net revenues accordingly. To get to a toy store requires a customer to travel to your location, put gas in the car that gets them there and arrive only during the hours the store is open. This inconvenience and expense can keep customers at home. Particularly if you offer free shipping for orders over a certain dollar amount, ordering from your e-commerce site reduces the cost of the shopping experience to the few minutes it takes to place items in the shopping cart and type in a credit card number. That encourages impulse purchases that increase your revenues without a corresponding increase in expenses.

2)Reduced Overhead

When determining transaction costs, businesses have to factor in expenses required to maintain and process the activities. An e-commerce operation doesn’t require a salesperson to woo the customer, a cashier to ring up the sale or a brick-and-mortar store for customers to visit. While e-commerce operations aren’t free -- businesses should have a professional design and maintain them -- they require fewer resources than traditional TOY stores.

3)Inventory and Distribution

E-commerce also can reduce transaction costs by streamlining supply-chain management and distribution. If a store expands its product selection online, more orders can be shipped from the warehouse or wholesaler directly to the customer. The store can now serve lucrative niche markets. It doesn't have to stock a lot of hard-to-find parts in its showroom, for example: its customers can order the parts online and ship them to their door.

4)Integration

Stores that have both e-commerce andtoyoperations can combine the two to make the ordering process more efficient. Customers can order and pay for products online and pick them up at the store. This allows a store's toy operation to prepare the products when in-store traffic is less busy and streamlines the process for the customer. It also requires less space for toys to market its merchandise when the Internet serves a similar role.

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