Firewires Value Chain Analysis and Competitive Forces Model - Essay Example

Chapter 11 Firewire’s Value Chain Analysis and Competitive Forces Model i. Inbound and outbound logistic management The productionsystem adopted by Firewire has the possibility of enhancing its inventory management through the avoidance of overheads. The production procedure for the surfboards had been traditional in the past before they adopted the use of computer-aided design system. The traditional method involved the use of skilled craftsmen known as shapers who designed and built surfboards by hand. With the computer-aided designs (CAD), the boards are appropriately designed before being sent to the cutting facilities. Thereafter, an 85% to 90% complete board is returned to the shaper for completion, customisation and lamination. This whole process involves about 29 labour intensive and time consuming steps to manufacture the boards. To enhance efficiency and attract more customers, Firewire moved from the multifaceted production process to the CAD system that allows it to customize boards to elite customers. Furthermore, it uses a ShapeLogic NX software that allows its customers to feed the CAD, experiment with the designs, and integrate it with the computer numerical control (CNC) process. This software also provides its customers with an online system for customization that has advanced CAD tools and a web-based interface feature. This is Firewire’s most essential logistical infrastructure. A customer generates the model through the system which is directly transmitted to the factory for the manufacture. ii. Operations The major operations of Firewire are the manufacturing, marketing, distribution and sale of the surfboards. However, much of this is done online. The company thrives on innovation having engineered the first main change in the composition of surfboards for about 40 years. The materials used comprise of expanded polystyrene foam and epoxy resins. Distribution and sale of products entails the customers making modifications to the intended designs and even sharing with fellow surfers to seek their opinions before ordering for the same. iii. Marketing and sales This is attained through interactive communication among customers who after using the products reports the same to friends and colleagues who then visit the company’s website thus, leading to the creation of a marketing buzz for boosting of sales. Basically, the company’s marketing and sale of the surfboards is made through an online-based social networking process that allows for the sharing of the unique design files among various customers. iv. Firewire Technology The main form of technology used for production of the surfboards is a computer-aided design (CAD) that has been integrated with a computer numerical control (CNC) for the manufacturing process. A special software known as ShapeLogic Design-to-Order NX has been adopted and being used by the company in the enhancement of the online customization process. Competitive forces model i. Threat of new entry/Competition The attractiveness of an industry can be lowered by the entry new entrants into the industry. However, this largely depends on the barriers that have been put for entry. In the case of Firewire, the barriers for entry would be assumed to be high considering the technology adopted by the company, which gives it an absolute cost advantage over other companies. However, there is stiff competition in the crowded field that is expected from rival firms like Surftech, Isle Surfboards, Aviso Surf, Channel Island, Board works Surf and Lost Enterprises. ii. Threat of substitutes The market for surfboards has little substitutes except that some companies may offer convenience and low-priced goods. This leaves consumers with a wide choice of varieties for the desired products. However, the use of online shopping method allows Firewire to develop a concrete system that efficiently grants it an advantage in prices. 1. Product differentiation In differentiating the company’s products from its competitors, Firewire has opted to reintroduce balsa wood to its surfboards particularly, in their rails. The essence of this is that it provides the boards with an added time for flex response, as well as enabling the company’s boards to be able to maintain speed during the precarious maneuvers made by surfers. Consequently, the boards are lighter, more flexible and stronger as compared to those of competitors. In reaching out to customers and persuading them to buy of the company’s products, the company relies on its good reputation developed from the awards and acclaims it has obtained from the reduced environmental impacts of its materials that only emit 2% of harmful materials (Laudon & Laudon, 2013). 2. The CAD is the technology that is applied in the manufacture of the boards. With the computer-aided designs (CAD), the boards are appropriately designed before being sent to the cutting facilities. Additionally, the CAD is used in the customization of the products by customers online. 3. The integration of CAD and CNC by Firewire helped in the customization of the online process that allowed customers to experiment with designs that had been established. This integration enhanced the purchase process among customer hence, improving Firewire’s operations. Chapter 12 The business intelligence users at Colgate include senior managers, managers, employees, Colgate’s power users, the 65 business intelligence experts, other executives and a large number of users about 4,000 who interact with the SAP system on a daily basis. 1. First, Colgate experienced disparities in its data that was being developed between the various geographic regions, as well as those that were being used by individual regions or business units. The main issue here was the constant change in the data. Second, Colgate desired for more usable data that could drive its business decisions in a manner that even the managers and business intelligence units globally could be on the same platform. Third, the produced data, was not efficiently being used by Colgate’s employees in the making of decisions that could positively impact on the organization. As such, this also prompted the company to have a change in its business intelligence system (Laudon & Laudon, 2013). Consequently, while the power users of Colgate had not difficulties in using the analytical and reporting tools available, the main concern for Colgate was that its senior managers did not feel comfortable with this kind of system. For instance, they could not run ad hoc reports, or even drill down into the data layers for information that could help them answer the questions brought about by the data (Laudon & Laudon, 2013). Finally, Colgate was more concerned because the users were not much concerned with the development of good reports as even those that were brought to them lacked drilling and navigation capabilities. 2. For managers and senior executives, Colgate provided them with access into deeper warehouse data in a more user-friendly and timely manner. This was attained through the development and implementation of the SAP NetWeaver BW Accelerator that could speed up the loading of data and improve the perceptions users had on it with regard to the development of customized reports. Technologically, dashboards prototypes were created that would enable management review and assess the progress of the projects. Organizationally, Colgate organized classroom trainings that identified people to be used as reporting tools for the system. 3. The new business intelligence system supports the customization of reports for senior management and executive, and also provide for the easy access of information on their own. They can now see the company’s real data as based on the system. Second, the business intelligence system supports the provision of better reporting tools in a company. Third, there will be an expansion of users for the system in the future. The potentiality in all these aspects lies on the fact that the business intelligence will allow for proper monitoring of the business activities especially in relation to the growth prospects (Laudon & Laudon, 2013). Reference Laudon, K. C., & Laudon, J. P. (2013). Management information systems: Managing the Digital Firm, Upper Saddle River, N.J: Pearson. Read More