In this assignment author is producing a report which evaluates how external events influence IS strategy and design within ASDA Wal-Mart a food retail supermarkets. In task one author evaluate different modes of enquiry and give an overview of selected Multi-National Corporation. In task two author focus on the impact of online shopping technologies in ASDA Wal-Mart and finally author use some tools to analyze and reconcile external pressure and IS strategic planning and design. The rapid IT development has caused changes and impacts on a society. This report will evaluate how an organization use IT to remain competitive and how external events influence IS strategy and design within Multi-National Corporations (MNCs) from the food retail sector (e.g. ASDA, Sainsbury, Tesco)
TASK 1
1.0 MODES OF ENQUIRY
DIFFERENCES BETWEEN MODES OF ENQUIRY.
Enquiry is an action taken by an observer to find out the true reasons behind a failure or a problem situation. Or it can also be defined as an action for collecting the knowledge and information required for the same reasoning. There are three basic modes of enquiry which are then subdivided into further modes of enquiry as described below.
SIMPLE MODE OF ENQUIRY.
INDUCTIVE / CONSENSUAL.
Inductive enquiry technique is a simple technique in which solution to a problem is derived from a limited amount of observations. These observations which are directly related to the problem could be based on analogous, historical or multiple sourced data. Analogous data helps observers to specify a problem to be simpler than one but complex than the other. Historical data explains that what the solution of the problem or similar problems was in the past. And multiple sourced data is the average of advices from a group of experts regarding that particular problem.
ANALYTIC / DEDUCTIVE.
This technique shares many similarities to inductive technique discussed above and derives only one single solution or answer to a problem that could be a number or a truth. This technique breaks down the problem into its components, find a solution for each of those and extracts only one answer to the major problem.
COMPLEX MODE OF ENQUIRY.
MULTIPLE REALITIES.
In this mode of enquiry the observer places the observed data from the problem against his own theory which is unique to him and extracts multiple answers towards the solution of problem based on different theories. The result is many different aspects of the problem itself including many different solutions to those problems which can be implemented. But the person who is responsible for decision making is having difficult situation in front because of many options that are available and many routes of action that could be taken. Just because of this fact there is definitely a risk factor involved in this method of enquiry.
DIALECTIC.
Dialectic is often referred as a practical decision making tool which depends on looking into the methods, assumptions and theories by which the problems are defined rather than looking into the data or observations to find out an answer. Two possible solutions are derived from the problem which then results in one single and accurate solution. This method of enquiry dugs deep into the problems and is used widely in practical world.
INNOVATIVE MODE OF ENQUIRY.
UNBOUNDED SYSTEMS THINKING.
The concept of understanding the problem situation in context of a mess or focussing on the problem as a whole keeping in mind that the sum of different individual sections of the problem is smaller than the problem itself is the basis of unbounded systems thinking. A problem is considered as a mess which demands a creative approach to the solution. Emergence attributes which are functions of the whole are the resultant because of these messes.
1.2 PLAN TO CARRY OUT THE RESEARCH.
The mode of enquiry which will be used to carry out the research is the analytic / deductive method. There will be only one possible solution to those problems depending on this method of enquiry. ASDA Plc, is choosen for this purpose, which is a part of American retail multinational conmpay Wal-Mart. Author have decided to investigate how ASDA Plc use IT to remain competitive and how external events influence IS strategy and maintains a competitive advantage against its competitors. Author chooses this company because ASDA Plc Superstore is five minutes away from his accommodation in Preston, so to get the required information is very easy.
1.3 INFORMATION TECHNOLOGY
"The number one benefit of information technology is that it empowers people to do what they want to do. It lets people be creative. It lets people be productive. It lets people learn things they didn't think they could learn before, and so in a sense it is all about potential"
Steve Ballmer, CEO of Microsoft Corporation(Microsoft, 2005)
Basically, information technology is an industry or discipline involving the collection, dissemination, and management of data, typically through the use of computers and internet.
www.uen.org/core/edtech/glossary.shtml
The use of the computers and internet has become a well established form of communication for businesses to take advantage of. It allows the organization to open up new markets, reduce costs and create opportunities of trade on a world wide scale. Today all large businesses, as well as many small businesses and enterprising individuals, have websites to do online shipping. Online shopping is the part of e-Business, which enables the consumers to buy and explore products and services on internet in quick and easy way. Now days most of the supermarkets use online shopping (.e.g. ASDA, Sainsbury, Tesco) (K-Solutions, 2009)
The web is a shopping bazaar filled with millions and millions of products for you to buy. Online shopping is in the billions and billions of dollars. Some products, which are online, are not sold in the stores, i.e. Tesco's sell electronics good on the Internet but on most of their stores they do not sell anything apart from food and drinks. The percent of retail trade done in the Uk by online shopping in 2001 was 1.5%. This rose more than half the following year in fact in 2002 it rose to 4%. Tec save would benefit by introducing online shopping now because research tells us that the percent of retail shopping done on the web will continue to rise.
1.4 THE STRENGTHS AND WEAKNESS OF ANALYTIC / DEDUCTIVE METHOD.
1.4.1 STRENGTHS
• The strengths of using analytic mode of enquiry are always having one direction or solution to head towards. This method does not create confusions and gives one possible solution. The risk factor is also minimized.
• The Unstructured Interchange model effectively brings skills to consumers and customer participates in the discussion. This model works
1.4.2 WEAKNESSES
• The weakness of this method is that it is very easy to use and implement, without any special training, which might cause miss other possible and batter solutions.
• This model only works if customer provides all of the information that organization need to know to begin working on the problem. Because it's unstructured, this model may be unreliable.
TASK 2
2.0 IMPACT OF TECHNOLOGICAL INNOVATION.
2.1 IMPACT OF ONLINE SHOPPING USING PEST ANALYSIS.
Online shopping is simply when a customer buys products from the internet. Online shopping has grown more popular with customers as people are finding shopping online more efficient and as most will be using the internet in their homes it allows them to shop in a comfortable environment. Many companies now have online websites where you are able to buy the same products from the internet as in the actual stores in the high street.
This is an example of how online shopping works when using the Tesco website. The first thing that you must do is register and in this case giving details such as e-mail address, postcode and club card number. In most businesses the first step of online shopping would be to register however some of the register criteria do change from company to company.
Once you have registered you are able to sign into your account and proceed with the online shopping. When you have browsed through and chosen a product that you would like to purchase you are able to add the item to your basket and go to checkout. At the checkout you would need to provide details such as name, address however this should already be inserted as you provided these details when registering. Finally you are able to choose the type of payment that you will use to purchase the item. Most businesses would require for you to use a credit or debit card to purchase your goods however some do allow other types of payment methods, such as payment on delivery this is when you pay for the item in cash when the product is delivered to your home.
The online shopping facilities offered by the supermarkets, ASDA and Tesco. Both sites have been designed using similar layouts, frames to separate hyperlinks etc, this ensures the users of one site will be comfortable using the other i.e. they will know what to expect. The registration processes in both sites are simple and straightforward with only a limited amount of information required from the user. It is important to note that neither site uses H1, H2 elements as recommended by W3C, therefore there is no hierarchy of heading levels which may cause confusion to users of aural browsers.
The Tesco site is more aesthetically pleasing, there are a limited use of pictures and colours and text is limited to the default red, blue and purple which is used consistently throughout. Although there is a lot of text on the page it is well designed and organized, it is also structured and laid out in a way which is easy to read with the use of headings and subheadings to differentiate between groups and sub-groups.
In contrast the Asda site text appears to be very small and the use of coloured bulleted squares to identify each department results in too many colours being used, subsequently making the pages look messy and cluttered. These colours are sustained throughout and as each department is chosen the header colour in the main frame changes in accordance, it is therefore relying on and assuming that all users will be able to distinguish between colours.
The shopping experience itself was simplified with Tesco due to the 'express shopper' search facility which enables the user to type an entire shopping list onto a 'notepad' and then conduct a search; it looks for the first product on the list and transfers the whole list onto the left hand bar allowing the user to then click on the links in the list to search for their items one by one. Asda provides individual searches using a product search box, which does not highlight data within it when clicked; this can result in errors when searching due to the previous search not being deleted properly.
Search results provided very different results; Tesco searches were very succinct with only a few relevant items offered as options whereas the Asda searches resulted in a multitude of choices within different departments, many of which were often inappropriate, resulting in subsequent searches having to be carried out. Both sites use tables in order that the user can choose a time and date for delivery, the Asda site is very self-explanatory and easy to understand whereas Tesco is confusing with different prices for various time and day slots with no explanation as to why. Tesco do offer an alternative website designed for users with impairments and accessibility
Impact of online shopping
As more and more customers are shopping online that results in far more money being spent online. Businesses earn a vast majority of their profits in the run up to Christmas. According to the leading e-commerce trade body IMRG shoppers spent £4.98bn in 2005 during this Christmas period and for 2005 as a whole it calculated shoppers spent £19.2bn. Here is a graph from the IMRG to show the growth in UK online shopping from Dec 2000- Dec 2005.
Tesco is an example of a very successful company online. According to the research company comScore, Tesco has a huge 66% of the UK's online shopping market. In 2006 Tesco took an average of 30,000 orders per day which amounts to £2.5m. Other successful online companies include Asda and Sainsbury's.
The many advantages of shopping online rather than physically going out and buying the product, here are few that I believe are the most important to people when buying online:
• Shopping online can be very convenient as it can be a quick and easy process. It also has the convenience of being able to shop in a comfortable environment (your own home). Another benefit is the ease to find products when doing online shopping as you are able to search for products as soon as you enter the website using a search box or other links, this is a big difference from actually going to the store as you spend time looking for the product.
• Online shopping also allows people to compare prices on the product in a quick and easy way. This cannot be done in a very effective way if you physically go to the store as it would take a long time to compare prices from one store to the next. Once you have found a product you want to purchase you simply can do so with a click of a button rather than waiting in queues.
• At times some online stores give special online deals which can't be found on the high street.
There are also some disadvantages of online shopping. I have chosen a few which might give people reasons as not shop online:
• Online fraud is probably the biggest reason as to why people are cautious of online shopping. Some people find it hard to trust websites with their personal information and their payment details. Identity theft is still a big concern as hackers can break into websites and steal personal information such as name, address and credit card numbers. To protect their networks e-commerce websites can install anti-virus software, firewalls etc. General advices given to consumers on this matter include using websites that they are familiar with and trust.
• Another big problem with online shopping is that you don't have the opportunity to physically encounter the goods as websites only provide images. This means people may purchase items from the internet which is quite different in real-life. This can also be a tool for fraudsters on unreliable websites as they can describe a product which on the internet may satisfy however once delivered it won't be what was expected.
• Another disadvantage of online shopping is the waiting that you will have to do for the product to arrive. In a store you can purchase the goods and take it home straight away however with online shopping you must wait for you product to be delivered.
Author produces a Pest analysis which describes the impact of online shopping in ASDA Wal-Mart Ltd.
Political
The political element of the external environment remains the same for the local and national levels because the ASDA Superstores are only in Britain.
At present the changing trend of globalised business could be a challenge as well as an opportunity for the ASDA Plc's because they would have to compete against new forces from all over the world to maintain best quality of the products and services they offer. For example online shopping play an important role in today competitive retail make environment and become a main element of business success.
Economic
ASDA offers Britain's best value weekly shop with prices 10 - 15% lowers than their main competitors and an unmatchable mix of fresh food, grocery, clothing, home, leisure and entertainment goods. ASDA continues to widen the gap between their competitors and 11.2% cheaper than their competitors, especially in online shopping. In home shopping ASDA give their customers lots of promotion offers.
Social
ASDA Plc introduce in shop and online lots of the variety of products and services for their local and national level customers. For example ASDA's new recipes of ready meals, fresh vegetables, fresh meat and milk are very well popular in its customers. So, for customer satisfaction and make its social values stronger, ASDA Plc delivers online shopped products or services on time and with cheaper price to match the ongoing trend.
Technological
It is predicted that by 2011 the online retail sales in Europe will hit approximately 263 Billion Euro because of the rapid increase of online shopping in which the shoppers in UK may accounting for more than a third of all revenue. ASDA Plc's can take the advantage of utilizing internet as an advertising media as 8% of the global advertising is spent on the internet and the percentage is increasing day by day (The Economist, 2007). It will be very cost effective and help the company to globalize very easily.
Overall I feel online shopping can be a very useful tool, especially for people who may not have enough time to shop in stores. This can also be useful to the elderly as they do not need to leave the house to purchase goods that they would like. There are some issues that still need to be resolved such as online fraud and security. ASDA is a well-established organization and offering brilliant online products and services its customers and in feature have a plan to make a lot of improvements in their online shopping sector.
IMPACT OF TECHNOLOGY ON IS STRATEGIC PLANNING AND IS DEVELOPMENT.
Soft System Methodology has had a significant impact on the understanding and development of methods. It is a qualitative methodology and was developed by Professor Peter Check land and his colleagues at Lancaster University (Hawkes, 2008).
To allow a better understanding of the complexities of the situation, the method allows the problem situation to be suited from many points of view. The methodology consists of a seven stage process that provide the means of progressing through these levels which are system thinking, finding out about the situation and then taking the necessary actions. These seven stages are as following,
Stages 1 and 2: Findings out the problem situation
In these two stages efforts are made to find out the problem situation, which involves construction of a rich picture of the current situation by making use of the means available. The rich picture will contain details of processes that are important, number of people involved, lines of communication between people or groups of people, environment, owners of the system and most important of all the problem areas of conflict which require resolving. Several iterations may be needed to create an acceptable rich picture but the process on the whole serves to simulate debate and ensure a richer understanding of the problem situation than that achieved by using conventional hard analysis techniques.
Rich picture can be used as a communication technique between the analyst and users of the system. The picture represents the people involved, areas where there might be problems, sources of conflict and controlling bodies. The problem solver can extract useful information from these pictures such as things that might be causing problems and hindering the smooth running of the system. The picture may show conflicts between departments, shortages of supply and absences of communication lines and so on. They help in the identification of problem and not in the process of recommending solutions.
Rich pictures have proven to be a very successful in getting the users to talk about the problem situations. The problem solver is responsible for performing analysis on the soft system and end up with a rich picture as output of this transformation process. The analyst uses the resulting rich picture to aid their communication with the problem owner and they will notify the conflict he/she observes on personnel or function. The rich picture is a means by which to identify problems and inform the problem owner of the situation rather than provide possible solution.
Stage 3: Selection
This stage is concerned with defining the situation in ways so as to produce enough insight into the current system. Emphasis is placed on producing a root definition that captures the essence of the problem situation in one or two sentences. However several root definitions can be created to reflect upon the different views if this is seen as fruitful. A six- element checklist is used to produce the root definition CATWOE, described in 'plain English' by Arison and Fitzgerald as "who is doing what for whom, and to whom are they answerable, what assumptions are being made and the environment it is happening in.".
The elements of CATWOE are as follows:
C - Customer or clients is the 'whom', the beneficiary of the system
A - Action is 'who,' carries out the change process
T - Transformation is the 'what', the changes taking place
W- World-view corresponds to the 'assumptions' made
O - Owner is the person 'answerable' or the person with the power of veto
E - Environment is the 'environment' of the problem situation/constraints that need to be considered
(authorstream, 2006)
Stage 4: Model building
The conceptual model can be built using the root definition when the problem owners and the people who are aiming to solve the problem are satisfied that the definition is well formed. The conceptual model is a diagram of activities depicting what the system that has been described by the root definition will do.
Stage 5: Comparing models with reality
This stage looks at the comparison between the conceptual model with the problem situation to identify the differences, which can then be resolved through iteration of root definition and conceptual model stages.
Stage 6: Assessing feasible and desirable changes
In this stage proposals are drawn up for those changes, which are both feasible and desirable by analyzing the proposed changes from stage 5.
Stage 7: Action to improve the problem situation
When the feasibility issues have been resolved satisfactorily, recommendations are made for the actions needed to accomplish these changes.
IT expertise also needs to be coupled with strong business application skills. Therefore, requires a flexible, multi-skilled work force. In general, it's likely to accelerate existing up killing / multi-skilling trends in the OECD work force. These increase the demands on schools and vocational training facilities. The worldwide information access slowly decreases cultural and language differences. Besides, the -ecommerce also affect.
ASDA Wal-Mart is a good example. It becomes the largest online retail business in UK. Besides, e-commence also transforms the marketplace. It'll change the organization of work, new channels of knowledge, diffusion and human interactivity in the workplace will be opened, more flexibility and adaptability will be needed and worker's functions and skills will redefined.
Through e-commerce, firms are to move much of the customer service and after-sales service online so that customers can access databases or "smart" manuals directly. This builds better quality customer relationships. E-commerce reduces production cost by providing self-service online and making automated transactions, payment, and order fulfilment possible. Many firms save money on staff and paperwork via electronic order processing, billing and e-mail services.
E-commerce promote the development and availability of information technologies and access of advanced net-works either by means of conventional telecommunications policy measures or through other appropriate policy instruments foots may also have to consider what policies, if any, might encourage the trends towards lower prices and thus accelerate connectivity which can lower social class difference.
As technology grows, newer & newer appliances are available. One of the latest & popular communications innovations is the Video Conferencing (VC) which is the computer telephony Integration (CTI).VC changes the ways of human communication. In the past, written letters and telephone calls are the main communication channels.VC has a dramatic effect on the way people do business and the increase of productivities. It can share any type of info such as pictures, graphs, slides and softw3are, etc. Decisions are made faster; bringing products or services to market quicker; and enabling forms to stay ahead of their competitors.
People do not need to travel long distance for business by using VC. It helps to save travel time. The hiring cycles for key employees is shortening. It also reduces travel cost. However, the postal services and letter/documents delivery service is affected due to the need of written letter/paper document is lower. However, the standard and quality of VC depends on telecommunication connectivity and bandwidth, country infrastructure & resources. Therefore, government should plant policy measures to improve the situation also have the responsibilities to help the development of telecommunication facilities on less-developed countries.
Indeed the data security problem is a threat not only t the firms but also to customers. Online payment, transactions, money transfer, etc. all require personal information and password to access. If the online security is low, it may cause a great loss (money) to customers and even cause the firm to bankrupt.
To protect safety of the customers, and the business of themselves, the firms must development high security system and up-date the system time to time. In order to maintain competitive, the firms must provide more additional services (e.g. storage volume, security) to their customers. This greatly increases their production costs. However, the costs can't be transferred to customers. To fix the problem, IT professional should take sensible precautions in general and using up-to-date software.
TASK3.
3.1 HARD AND SOFT PROBLEMS ON INFORMATION SYSTEM STRATEGIC PLANNING.
During the past decades the perception regarding the meaning of IS and IT or strategic information system planning (SISP) has changed frequently. During the 1970s, the primary task of SISP was the improvement of communication between users and their top management, and meanwhile finding ways for IS to develop further. In the late 1980s this formulation was only extended by the aim of finding organisation wide architecture and seeking other strategic applications within the MNCs. (Pun et al, 1998).
Nowadays this has changed slightly as Lederer et al define it (1996:237) as: 'Strategic information system planning is the process of identifying a portfolio of computer-based applications that will assist an multinational company in executing its business plans and realizing its business goals.' In other terms it can be said that in the initial phases of the creation of SISPs the requirements for the future system have to be identified, and since it has a strategic significance these definitions/goals have to be long run orientated.
According to Ledere et al (1996) SISP should be divided in:
• External environment
• Internal environment
• Planning resources
• Planning process
• Information plan
• Implementation of the information plan
• Alignment of the information plan with the organization's business plan.
In order to adapt this SISP structure many of the multinational organisations have the problem that they have preferred to made short time decision when the strategic (with long term impacts) managing was demanded. Now they find themselves in a position where they can't exchange the organisational IS history, from one day to other in order to meet the outline of SISP. Still senior management should spend a significant amount of time with the development of IT and IS networks, which should be done under considerations of a resource based approach, and also fulfilling the basic principles for the foundation of core competence building and internal competencies of the organisation (Arnold, 2007).
ASDA Plc, is a subsidiary of an American giant multinational company Wal-mart, which is very populous around the world. Currently, ASDA Plc, utilizes IT to achieve its IS strategic planning and is committed to maintaining leadership through use of IT. The future is very dynamic. Innovation and creativity is the key for further utilizing information systems in the future, which improve its service and innovation as a means of achieving differentiation thereby maintaining its position as market leader. ASDA Plc, has actively managed and used IT in the past to acquire its position as the leader. Currently, ASDA has been paying full attention to thrash out the 'hard' and 'soft' problems on IS strategic planning. A broad classification of problem types can be derived by taking the extremes of the spectrum, which extends from 'hard' to 'soft' and by considering the destination between questions, which are concerned with 'how' an activity should be undertaken as opposed to 'what' the activity is.
'Hard' systems thinking are goal-directed as the particular study begins with the definition of the desirable goal to be achieved. It is essentially concerned with the question of 'how' to achieve a predetermined aim. 'Soft' is concerned with defining the options for improvement thus addressing the 'what to do' question. It is also committed to the examination of human activity, which is the other soft part of the equation. Whereas hard systems thinking is concerned with the 'how ' of the problem, in soft systems thinking, the objectives of the systems are assumed to be more complex than a simple goal that can be achieved and measured. Every system can be said to have a set of purposes or missions rather than goals. Understanding of soft systems can be achieved through debate with the actors in the systems. Emphasis is placed on the 'what' as well as the 'how' of the system.
The use of formal strategic planning may improve performance in one subsystem of multinational companies, but if the balance between desired strategic outputs and the basic principles of MNCs dynamics and culture are disturbed it may result in a significant cost for the companies as a whole.
To conclude it is important to say, that every multinational organisation can have a good product and well working or management, but in the business world it is possible that not necessary the best will succeed. Still in order to have a good working organisation it is important to make the best use of the available resources, internal competencies of the organisation, and the use of SISP in a very good way to achieve that goal.
3.2 ETHICAL ISSUES IN TERMS OF IS STRATEGIC DESIGN
Bretag (2004) suggested ethic as to "determine how right or wrong an action is by finding out how much actual good or harm it produces". In line with this definition, White (1994) suggested the "Ten Commandments of Computer Ethics", which is based on the Christian ethical code of conducts, to help guide ethical usage of computer and information technology.
Information technology is basic and core part of approximately all multinational organizations to do every task in the day to day life. In MNCs the management has to organize the systems and personnel relating to IT. Managing people and IT systems at the same time is a difficult task in itself. Managers have to consider many issues relating to client privacy and the use of systems in a proper and ethical manner.
There are many ethical issues while considering the Information Technology and few of them will be discussed here. The professional code of conduct for IT professionals is our guide in explaining different ethical issues that could be encountered in an information systems environment. The first one is the privacy issue. People are in danger of losing their private data as Information Systems grow day by day and more data is being written electronically. Furthermore the privacy of customers or the employees is at risk when project developers require this information for planning a task. This approach will greatly damage the personal privacy and is definitely not ethical in any way. Organizational privacy is also at risk when manager's access electronic information and this information become more and more common among personnel. Systems should be in place so that IS strategies include these privacy issues and avoid wide spread of organizational data.
Business ethics is the art and discipline of applying ethical principles to examine and solve complex moral dilemmas. Business ethics asks, "What is right and wrong? good and bad?" in business transactions (Bream, 2008) Although no one "best" definition of business ethics exists, the consensus is that business ethics requires reasoning and judgment based on both principles and beliefs for making choices that balance economic self-interests against social and welfare claims.
It could be argued that the development of technology has become the cornerstone of business communication. (Bream, 2008) confirmed that through E-Commerce, business transactions can be done effectively and instantaneously through the use of security code called Cryptography. (Dickinson, 2008) explained that funds transaction is processed and confirmed electronically by converting information into algorithm to prevent unauthorized viewing or alteration of information. This form of transaction provides integrity, efficiency, reliability and credibility to parties involved in the transaction. This form of communication is in line with the ethical code of conduct proposed by (Doyle, 2002) as reliable.
CONCLUSION
From this report author can see the future direction of information technology. Author tried his best to do this report after a lot of readings and consultation. Nowadays, IT is a major source for Education, Health, and retail and in any kind of business. The rapid growth of the Internet eclipses all other forms of mass-communication in the developed world. Some experts believe that one billion people may be connected to the Internet by 2010. This expansion is driving dramatic increases in investments in computers, software, services, and communications, and has acted as a catalyst for the wide range of business and social changes. All this investment in bigger and better computers and networks ensures that the information technology provide higher services at lower cost even as the volume of consumers increases dramatically. Author's selected Multinational Company was analysed as to how well the organization has been in information systems technology. First of all the impact of new information systems on the organization's strategic planning was assessed as to how online shopping has affected the company's overall planning and performance. Then the potential hard and soft problems were discussed in planning the information system strategic planning. And finally few of the ethical issues were discussed in terms of information systems strategic planning.
