Chapter 3' Case study

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Chapter 3. Case study

• 200224010 ???
• 200224015 ???

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1. Evaluate Kmart using the value chain and
competitive forces models. What Kmarts business
models and business strategy?

• Kmart began developing BlueLight.com, a Web site
  designed to polish its image.
• Kmart have stolen bargaining power to supplier
• Kmart used a promotions-driven business model
• Business strategy is discount store

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2. What was the relationship of information
systems to Kmarts business process strategy? How
well did its systems support its strategy?

• For Kmarts competitive advantage, they used
  promotion driven and started investing 1 billion
  to modernize its information systems. But they
  dont used the systems well.
• Kmarts inventory turnover rate was very low. So
  they selected i2 Technologies. But i2 execution
  isnt flawless
• Kmart began installing new warehouse management
  software(PkMS). Its goal was to move products
  more quickly through Kmarts distribution centers
  to the stores, thereby cutting costs while
  getting the product on the shelves before it has
  been sold out. But it was so extensively modified
  that it no longer could work well and cost too
  much to maintain.

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3. What management, organization, and technology
factors contributed to Kmarts problem?

• CEOs wrong decisions
• This organization followed only Conaway.
• I2s highly cost, low effects.

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4. How important was supply chain management in
contributing to Kmarts problem? Evaluate
Conaways decision to use i2 software to improve
Kmarts supply chain management.

• Outdated technology at the distribution centers
  resulted in supplies often sitting on pallets for
  a long time hours until they were recorded in the
  central tracking system

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5. Were those blaming software for the collapse
of Kmart correct? Explain your answer.

• Kmart began installing new warehouse management
  software(PkMS). But it was so extensively
  modified that it no longer could work well and
  cost too much to maintain
• Kmart must reflected other persons opinion.

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6. It has been said that Wal-Mart uses their IT
strategically, and they fully integrate it into
their operating model. Dose this statement apply
to Kmart? Explain your response.

• Kmart applied Wal-Marts approach.
• But these approach didnt suit Kmarts taste.

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7. List the problem Conaway faced when he took
over Kmart, and then describe the short- and
long-range policies you would have followed had
you been in his place.(1)

• Wal-mart was already spending only two cents per
  dollar getting goods to its sores while Kmart was
  spending five cents.
• The company developed capabilities to collect the
  necessary data, but it did not use them to
  forecast demand, relying instead on managements
  judgments.
• Kmart continued to lose ground to competitors
  while it gained the image of being old-fashioned
  outdated, and frumpy. Many of its shelves were
  empty

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7. List the problem Conaway faced when he took
over Kmart, and then describe the short- and
long-range policies you would have followed had
you been in his place.(2)

• Short-range use current data for forecast
  demand and helping Kmart to focus on the better
  selling items
• Long-range to become the shopping destination,
  Kmart must developed supply chain management
  (reduce excess inventory in stores and
  distribution centers, thus lowering costs, and
  enabling Kmart to lower prices)