Integrated with business processes; e. G. Order taking and fulfillment. Example – Any customer order Is transformed to a computerized Inventory Check. Customized Catalogs Assembled specifically for: -A company – An individual shopper Customization systems can: – Create branded, value-added capabilities – Allows user to compose order – May Include Individualized prices, products, and display formats – Automatically identify the characteristics of customers based on the transaction records.
Electronic Catalogs at Base Cascade Bose Cascade Office Products–$3-billion office products wholesaler of over 200,000 different Items – They had a 900-page paper catalog that was mailed once each year; mini catalogs tailored to customers’ individual needs – The company placed its catalogs online in 1996 (. COM). Sales through the Web site: -?20 percent _1999_30 percent -?80 percent (expected) Production of a single paper catalog took 6 weeks/production of Web catalog takes 1 week Major advantage of customized catalogs is pricing Electronic orders cost 55 percent less to process than paper-based orders Bose Cascade (can’t. ) SEC application case 2 Question 1 : When comparing performance during the first five months of 2004 with performance in 2003, which warehouse shows the most improvement?
SST. Louis is the only one showing any improvement, using cost per unit shipped as the performance criterion. The cost for the first five months of 2003 was $9. 97 and for the first five months of 2004, it fell to $9. 07. Question 2: When comparing performance during the first five months of 2004 with performance in 2003, which warehouse shows the poorest change in performance? The worst change is the company’s own warehouse (located in ), where costs per unit shipped increased 31%.
Among the public warehouses used, Denver was the worst in terms of cost per unit handled. It is also the most expensive public warehouse that Brand uses. Question 3: When comparisons are made among all eight warehouses, which one do you think does the best Job for the Brand Company? What criteria did you use? Why? Using the cost per nit handled criterion, SST. Louis does the best Job, closely followed by Chicago. Question 4: J. Q. s aggressive and is going to recommend that his father cancel the contract with one of the warehouses and give that business to a competing warehouse in the same city. J. Q. Feels that when word of this gets around, the other warehouses they use will “shape up. ” Which of the seven should J. Q. Recommend be dropped? Why? Denver has the lowest volume and highest unit costs among all the public warehouses used. In addition, it had been closed by a strike which must have inconvenienced the Brand Company.
It may be that the warehouse workers’ unions are strong in the Denver area. J. Q. Should probably check out rates and productivity measures of other Denver warehouses before deciding to drop its current warehouse there. Advantages of e-catalog and sales volume evolution Online catalog benefits week Major advantage of customized catalogs is pricing. Electronic orders cost 55%less to process than paper based orders. Sales through the Web site SEC application Case 2. Search Engines, Intelligent Agents and Shopping Carts engine – Computer program that can access a database of Internet resources, (intelligent) agent – Software that can perform routine tasks that require intelligence shopping cart – Order-processing technology that allows customers to accumulate items they wish to buy while they continue to shop 2 JUST-IN-TIME IN Question 1: Total annual cost: Gas range: Toilet: pump: Refrigerator (large): Refrigerator (small): [(95+1 5/(1 Foam cushion: 500/(1 DVD player (type D): Dome light: Awning brackets:
Insect screens: So: Current system’s total annual cost= 918892 Question 2: Refrigerator (large): (1 Refrigerator (small): (85+1 Foam cushion: so: SIT system’s total annual cost=295516 Question 3: If Challenger use SIT system, he need to spent extra cost of buying equipment. It need about between $500,000 and $1,000,000. This cost is not necessary for current system. On other hands, using SIT system will save annual cost. The current system total annual cost is $918892, however, SIT system Just need $295516. The former minus the latter is $ 623376.
So if Challenger using SIT system will reduce his cost it equal to improve the benefits. Question 4: If using the SIT system, there are some items needs to maintained safety stocks. It included Pump, small refrigerator, foam cushion, dome lights, awing brackets, and insect screens. The reason why they should be maintained is the average number of huge gap between these numbers easy to due to shortage of resources. Therefore, it should maintained safety stocks. I believe that the number of safety stocks should achieve half of the average number of units used each week.