The value chain model is a useful analysis tool for defining a firm’s core competencies and the activities in which it can pursue a competitive advantage.
Cost Leadership
An organization always aims to be the low-cost producer in its industry, if an organization can maintain overall cost leadership then it will reach superior performance.
Differentiation
This strategy would demand an organization in offering something unique to target its customers. The uniqueness can be concerned to products, the way it delivers its goods and services, the way it markets its products or anything that shapes a customer’s perception in relation to differentiation. At Aalsmeer, this strategy will be used. Floral decoration will be an option with every delivery, but at no extra cost. These decoration options will be up to the customer, they will be the ones who will choose what they want and how they want it. This will also increase customer relationships.
New Technology
The new technologies which will be implemented at Aalsmeer Flower Auction was identified in the value chain. The new technology includes, in order of the value chain, are:
Supply Chain Management at Aalsmeer
Supply chain management (SCM) systems will be implemented at Aalsmeer Flower Auction. This will be implemented because it has gained significance as one of the 21st century’s manufacturing technology and innovative paradigm for improving organizational competitiveness. This will fulfil Aalsmeer’s goal of enabling innovation. The ultimate objective of supply chain management is to get the right amount of their products from their source to their point of consumption with the least amount of time and with the lowest cost.
Supply chain management systems will help Aalsmeer Flower Auction to :
- Decide when and what to produce, store and move. This will work in accordance with the inbound logistics, Warehouse Management System as mentioned earlier.
- Rapidly communicate orders, which will in turn strengthen the link between wholesalers and retailers and well as suppliers and buyer. How? By being able to rapidly communicate orders, the system will be able to place customer’s orders efficiently and the products will be able to be produced effectively and delivered on time, thus promoting customer satisfaction.
- Track the status of orders
- Check inventory availability and monitor inventory levels
- Reduce inventory, transportation, and warehousing costs, by limiting the amount of flowers produced based in what is to be sold to customers, be it wholesalers or retailers.
- Track shipments.
- Plan production based on actual customer demand, which was mentioned in 5, to reduce costs.
- Rapidly communicate changes in product design.
Systems Development
The activities that go into producing an information system solution to an organizational problem or opportunity are called systems development. Systems development is a structured kind of problem solving with distinct activities. Such activities consist of systems analysis, programming testing, conversion, and production and maintenance.
There are many different types of SDLC’s which will be explained in the form of a table.
Justification of the Waterfall Methodology
A prototype is a working model of some aspects of the project product. It can be constructed quickly and cheaply to be shown to end-users and clients to ascertain their requirements. This model was not chose because it was time consuming. Aalsmeer needed a solution quickly. Developers can become too attached to their prototypes and this can cause systems to be left unfinished and/or implemented before they are ready. Sometimes leads to incomplete documentation, which leads to problems in the maintenance department.
The waterfall model was chosen because it encourages planning before designing, it broke the system up into sub components with milestones to be achieved before moving on to the next step. This ensures only the correct product that fulfils the users’ requirement is built during the whole development process. Any mistakes can be rectified easier since all the activities will be documented at each stage completely. The quality of the product at each stage can be identified and maintained to meet the requirements. The specification, design, printed code and other documentations such as the user manual are essential tools for maintaining the system. Another main reason for choosing it is that it is a stable and reliable model. As it is widely used in the industry for a long time its reliability is tested and proven.
Methodologies
Waterfall Model
With the use of technology using computers and the internet, Aalsmeer Flower Auction would be reaping the benefits of e-business. A systems development lifecycle had to be implemented to facilitate this transition moving from the old manual system to an automated system. By using the Waterfall model it would identify and develop the new information system.
Systems Analysis
This model begins with the first procedure, analysis of the problems and solutions. At Aalsmeer the problems are that their competitors possess the technology which results in being second best and a lack of efficiency. Aalsmeer wants to be able to strengthen the link with suppliers, as such, the implementation of an online environment will allow them to have conferences via built in webcams in the hardware. Interviews will be used to obtain information about the requirements of the system.
Design
Developers begin to design the system, it is highly important to understand what we are going to create and what our final product should look like. It is necessary for bugs and issues to be sorted out before coding begins. Software should be user friendly. Our solutions should provide; improved speed of response within the communication department, cost savings and enhance information and knowledge sharing between retailers and growers. System design helps in specifying hardware and system requirements and also helps in defining overall system architecture. Finding the best equipment saves money and time in the long run. This is necessary as trade is conducted on a daily basis at Aalsmeer and downtime would be costly. A website displaying products, providing tracking for shipping and allowing retailers to shop online should be implemented. This design concept should portray what Aalsmeer represents.
System Design encompasses two major aspects of the new system:
Programming
At Aalsmeer, a custom software will be used. The software will be customised to suit the needs of Aalsmeer information system staff to meet the organizations needs. Programming teams will be hired because constructing custom software is time consuming, but will be worth the time in the end.
Testing
All the units from the respective departments are integrated and tested vigorously to see if all units communicate with each other. This step is essential as huge quantities of flowers will be traded at Aalsmeers’. Being new players in this e-business category, they will have to prove themselves to existing customers and entice new customers, but they must maintain a high standard.
Implementation
After the design concept is finalised, the development of the system begins. This system should cater every aspect of Aalsmeers’ operations; spanning from the time the flowers arrive, going through sorting, pricing, storage and departure of the facility. Each department will use different programs relating to their activity and the development is divided up into units. Each unit is developed and tested to ensure it meets the specifications before being assembled as a package.
Operations and Maintenance
At Aalsmeer the implementation of the system should be phased in. Once established this step is never ending, due to the fact that the customer will realize the benefits of this system and keep it, but from time to time problems arise and solutions would be needed. A new type of flower may be put on the product line and adjustments would have to be made. A growing company will always need changes to suit their needs. By addressing strategy, technology, organisation, people and business processes as an integrated whole, Aalsmeer will experience benefits that are boundless.
Using systems development Aalsmeer should have the opportunity to increase sales by accessing new markets across the globe. The chance to target market segments more effectively by providing more accurate information and improving customer service experience. Improving the efficiency of the supply chain will help employee motivation through more flexible working methods. Allowing 24/7 access to the firm's products and service will provides convenience and comfort for customers.
Impact and Effectiveness of the New System
People
Information systems have affected the quality of personal and working lives. In the workplace, information systems can be deployed to eliminate tedious tasks and give workers greater autonomy, or they can be used to eliminate jobs and subject the remaining workforce to pervasive electronic surveillance. Consumers can use the Internet to comparison shop for everything from manufactured goods to financial services or even to participate in auctions—but at the cost of contending with spam (unsolicited e-mail), intercepted credit card numbers, and malicious computer viruses.
The system’s ability to store information means that the organization does not have to rely solely on the fallibility of human error, which is subject to error and erosion (Dewett & Jones, 2001).
According to (Laudon 2009) the most important occupational disease today is repetitive stress injury (RSI). RSI occurs when muscle groups are forced through repetitive actions often with high impact loads, or tens of thousands repetitions under low-impact loads (such as working at a computer keyboard). This computer related RSI is carpal tunnel syndrome (CTS). In which pressure on the median nerve through the wrists bony structure, called the carpal tunnel, produces pain. Millions of workers worldwide have been diagnosed with CTS. This can be solved by designing workstations for a neutral wrist position, using wrist rest to support the wrist.
Management
Information can be stored, retrieved and communicated far more easily and effectively. However, IT can often lead to information overload, meaning that managers have to sift through an insurmountable amount of stored data and thus hindering timely decision-making. Information overload is not an IT problem but more of a documentation problem. Furthermore, management tend to adapt to IT problems once it gets used to the idea of the new technologies.
Organisation
Information technology provides several advantages to the organisation; one such advantage is the ability of IT to link and enable employees (Dewett & Jones,2001). At Aalsmeer the implementation of the new system has created opportunities in terms of employment and increased productivity. Employees will be trained in order to operate such a system. While it is true that computers eliminate the human element which was once present, it is also true that in order for a system to work, it needs to be controlled at times by humans. Electronic communication at Aalsmeer will increase the overall communication within the organisation.
To every problem there is a solution, and this new information system can prove to be a success as long as everything is carried out in effecienty and effectively and also in an orderly fashion.
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