Information and Systems for Competitive Advantage - Research Paper Example

Information and Systems for Competitive Advantage: The Australian Wine Production Industry (Wineries) 1. Use the Ives and Learmonth’s CRLC to identify how businesses in the industry are using ICTs and applications to support B2C strategies and processes for CA and SCA. This question is not just a description of CRLC The Customer Resource Life Cycle framework is charged with plotting a lifecycle of how a customer acquires their goods and services from the supplier. It acts as a framework that explains how companies use information technology to implement their websites so that they may be in a position to compete with other players in the industry more successfully. For many organizations, such Web sites are helpful to customers because they are able to acquire resources, as opposed to determining requirements for resources. On the other hand, customers make use of the sites for determination of requirements, as opposed to using them for acquisition purposes. At the same time, the Web helps firms to be in a position to compete in the manner expected (Gonslaves, 1999, p.104). CLRC is advantageous due to the fact that it is able to provide guidance that assists in the search for SIS opportunities by focusing on the needs of customers. Products that are provided by an organization to its customers appear as supporting resources from the point of view of the customers. This is due to the fact that a customer must go through a kind of resource life cycle to acquire them, and this requires a significant amount of effort and time to manage. The ability of a supplier in assisting a customer to manage this life cycle enables them to differentiate themselves from the competition, thus creating a competitive edge. The differentiation method applied may be in form of enhanced customer service, introduction of direct cost savings or investing in ICT (Ives and Learmonth, 1984, p.1197). The relationship between ICT and the CRLC framework is crucial especially in today’s technologically advanced world due to the fact that enhancement of customer service/ experience is largely dependent on the advancement. ICT in the Winery Industry Various studies have been carried out to determine the prevalence of ICT in the wine industry; different forms of ICT used in the industry, how they are applied and incorporated in the various operations, what they are used for, their importance in enabling production, as well as the factors that could influence their use. The winery industry makes use of ICT in various processes including the production of raw materials, for instance in the farms that grow grapes, the manufacturers, and finally in the distribution process (Tembo, 2008, pp. 60-70). However, due to the fact that the paper focuses on the CRLC framework, only the distribution process and its use of ICT shall be put on focus. In the recent past, organizations operating in the wine business began searching for innovative tools, which were adopted alongside developed managerial capabilities geared towards making it easier to face any new challenges from the various markets and contexts. Countries such as Australia have gradually joined other producers of good quality wines, which they sell at reasonable prices, while at the same time managing their marketing strategies. With such initiatives in place, Australia could overtake the traditional wine producers thanks to the organizations’ ability to comprehend the dynamics of the market as well as identify appropriate and strategic responses. One of these responses is in the use of ICT to enhance the customer experience (Monday and Wood-Harper, 2010, pp.17-18). According to the European Union, embracing modernization in the entire wine industry is key to ensuring enhanced competitiveness. This belief prompted a process that was aimed at rejuvenating companies from the process of bottling through to marketing. In between the two, other processes include cellar adaptation, organization of producers and promotion. As such, it is only crucial that companies continuously and promptly adapt to the dynamics of an ever changing and highly competitive market for the sake of gaining competitive advantage (Annunziata, Misso and Vecchio, 2008, p. 6). The spread use of ICT has been done in such a way that it affects the entire production and distribution process. For instance, Jacob’s Creek, by using technology has been able to organise a pop up winemaking event where customers are able to create a customized wine to suit their individual tastes (Nzherald.co.nz). In addition to this, the companies have a virtual market which is accessible by use of ICT. The virtual market is where the companies carry out e-business. Potential customers are able to access the website of the companies, view their products and make any orders for the wines that they could be interested in. This is especially convenient since it does not require for a customer to visit any outlet as the products are delivered to the doorstep of the customer. In essence, this creates a competitive edge for the company as their competition may not be in a position to provide this kind of services to their customers. ICT has also been used in mixing and production process. In recent times, social media has become an active part of business enterprises. This has become a platform where the company gets to meet with potential and existing customers. Conversations are shared by the public in regards to product quality, pricing, availability, packaging and other issues in regards to new ideas in introduction of new products among other things. When such information is shared, the company in question gathers ideas and uses the information to create better wines or improve what they already have. They may also use the information to find out the areas where the market is not adequately supplied and therefore make amends on the same. This will help the companies to create an edge over their competition by availing products that satisfy their market. 2. New information and communication technologies, systems and applications becoming available businesses for gaining CA or SCA. As stated above, technology is already in use in the industry being used to create an edge over competition. The use of blogs and other forms of social media are the main sources of new information and communication technologies that are becoming available to the various companies. Through these media, it is easier to access the markets and customers and creating a niche for themselves in comparison to their competition. The various forms of social media that the organizations in question use include facebook, twitter, LinkedIn, Pinterest, YouTube, blogs among others. The use of phone technology is also a medium that could be used in gaining CA or SCA (Dong-Hun, 2010, pp. 1123-115). In creating a competitive edge over the competition by use of social media, a firm transmits information relating to products, acting as a form of promotion. In response, the company receives feedback in form of questions, comments and complains or complements (Hay, 2011, p. 102). Jacob’s Creek facebook page for instance contains information that is valuable to customers in regards to brands, events and goes further to give tips in regards to wine tasting, identifying quality wines among others. Customers also get to give their views in regards to wine issues, as well as in regards to various events hosted by the firm. Wolf Blass also maintains a fan appreciation face-book page where customers get to post their comments, views, remarks and any complains. The company acts on the same and this helps in improving brand quality, availability of products and thus gaining competitive edge over competitors. Use of blogs increases recognition and awareness by increasing engagement from the audience. To create awareness, the company inserts actions on their page so that it may be viewed by their followers. Actions in this case include details that relate to their products, giving reasons why people should use them and why they stand out. The success of blogs really depends on the number of posts that are made concerning the topic in question. (Kabani 2012, pp. 96-102). One of the wineries making use of blogs is the De Bortoli Wines. The blog is used to give information in details that would otherwise not be available on other sites such as pinterest, facebook or twitter. In one such blog Ieanne (2013), a blogger for the organization, made it known to clients and the public that the company had been picked as the award winner for having the “Best Presence in Social Media” at the Drinks Award, in the wine category. This, if used appropriately could help the firm garner public interest which will ultimately lead to a competitive edge over the competition. From this award, it is clear that the firm makes use of information technology to get in contact with their customers, a factor which is crucial in creating a niche for the firm. Stanton and Killeen wines maintains a blog on its website and just like the rest of the companies, the forum is used to keep stakeholders informed of the on goings in the company. In the blog of Stanton and Killeen, information shared is in regards to the latest news, upcoming events organized or sponsored by the firm, reviews, and awards received by the firm on various achievements. To make the experience more memorable and outstanding, the firm introduced a recipes segment where great and inspiring recipes that could be enjoyed alongside their wines are shared with the public. Twitter is widely used by firms in the spread of awareness, and therefore garners support for the products and their manufacturers (Onete, Dina & Danisa 2013 p. 659). Jacob’s Creek has a twitter account where such information is exchanged between various stockholders. Currently standing at 2, 617 followers, the customer experience is improved as experiences, views and feedback is shared. Wolf Blass Twitter account currently stands at 4, 526 followers, a rather sizeable number for the firm. The page is used to relay information in regards to products, events like wine tasting, history of the organization and other information that is relevant to the public. As such, the public gets to identify with the company on a much more personal basis. The companies are also making use of mobile phone technology in plans purposed at building relationships with customers. In 2013, Jacob’s Creek launched a smart-phone application dubbed the “Premium Drinks App”, which could be used by shoppers to scan receipts, which could then be redeemed for immediate rewards. The same application was also used in driving customer trials. According to the management, the firm aims to further develop digital communication platforms with their shoppers. Smart-phones have increasingly become a crucial part of the purchasing cycle of customers, and currently they dominate the research phase done prior to purchasing (Cmo.com.au). RFID is also a technology being applied by various industries, especially retail outlets. It stands for Radio Frequency Identification Device and is applied by firms to keep track of specific products as they are sold. The wineries could go into partnership with the retail outlets to help them identify the movement of their wines in relation to those of the competition. Knowing whether their products are first, second or third choices for customers is the kind of information that would be transmitted to the wineries, and this would prompt further research in a view to find out the reasons why customers prefer other wines as opposed to theirs. Factors such as tastes and preferences, quality and pricing would be some of the factors that the wineries could look into in attempting to improve the customer experience. Finally, the GIS (Geographic Information Systems) technology is used in the creation of spatial data maps which provide valuable information used in differentiating wine products and adding value to them. The spatial data is used by vineyard operators to survey the productivity of a region, for instance in New Zealand, wine growers use the technology in creating a database of all vineyards in the country. This database is referenced on the basis of geographical location after which the system creates a number of maps that are linked to the production of data summaries. The information from data summaries, used in conjunction with knowledge regarding areas with most suitable soils puts the winemakers at a good position to identify areas where grapevines are likely to grow best (Gpsdaily.com). 3. Explain how the new information and communication technologies (ICTs), systems and applications identified in #2 above might be used to create a CA or SCA. The discussion shall be based on two factors, being effects on existing business models and creating new business models. The organizations use the various technological forums in creating CA or SCA as more information is shared to the public in regards to some particular product. As such, accompany that engages its existing and potential customers is more likely to garner additional support from the market because they identify more with the market. In essence, social media is rather influential and could be used by a company to create a niche for its products. In social media forums, dialogue is important for success to be achieved, and it is crucial that any questions, answers, comments, remarks, complains, and complements are closely monitored to ensure that relevant and accurate information is transmitted to the existing and potential customers. False, incomplete, irrelevant, and inappropriate information would hurt the cause. In order to create a niche, and thereby augment the chances of creating a CA or SCA, it is important to ensure emphasis by increasing the number of posts posted on a day to day basis. Emphasis, like in advertising, creates interest, sends more information and lingers in the minds of the target audience. It also tends to create additional interest by inviting conversation from the audience (Onete, Dina & Danisa 2013, pp.667). The mobile technology application used by Jacob’s Creek for instance attracts more customers as they strive to make more sales to maximize on the rewards to customers. This tends to impact the current and the new market models due to the fact that it attracts an independent market segment by its own. Blogs used by the wineries help keep stakeholders informed of the on goings in the company. In the blog of Stanton and Killeen, information shared is in regards to the latest news, upcoming events organized or sponsored by the firm, reviews, and awards received by the firm on various achievements. To make the experience more memorable and outstanding, the firm introduced a recipes segment where great and inspiring recipes that could be enjoyed alongside their wines are shared with the public. RFID is capable of recording the behaviour of customers as they shop for the products that they need. For instance in a number outlets, a firm could use the forum to identify the movement of their brands such that when a customer picks their product, it gets recorded. If for some reason the customer changes the bottle for another wine, this gets recorded too. Such information is then relayed to the manufacturers and with the information; they make some informed decisions in regards to the kind of products that should be availed in larger quantity to particular regions. In addition, they could also take up some promotional events or organize customer/ fan appreciation activities based on the information received from the RFID. Brand loyalty could be enhanced by using this forum. GIS technology is important to winemakers as it assists in identifying the optimal climatic conditions in vineyards. This is especially so in microclimates where vineyards that are a few miles away may be much cooler or hotter as compared to one another. In wine production, a two degree difference could cause a major difference in the quality of wine produced. As such, the technology helps in the production of better and more quality wines. The technology is also able to identify the photosynthetic output of plants, based on their spectral bands in aerial imagery, and this guides the operators in picking the most suitable grapes in line with the preferred flavours at the time, such as vegetal or fruity flavours. This helps to improve the quality of wines produces and a firm could gain CA and SCA from the sophisticated quality of their products (Gpsdaily.com). Reference List Annunziata, A., Misso, R. And Vecchio, R., 2008. Information and Communication Technologies in the Campania Region Wine Business. [pdf] International Advanced Workshop on Information and Communication Technologies for Sustainable Agri-Production and Environment. Available at: http://ageconsearch.umn.edu/bitstream/37674/2/ICT_in_the_Campania_Region_wine_business.pdf [Accessed 14th May 2014] Aurora, 2011, Technology Plays Important Role to Improve the Wine Industry. GPS Daily, 11 Aug 2011. Dong-Hun L, 2010, Korean Consumer & Society: Growing Popularity of Social Media and Business Strategy. SERI Quarterly. Vol. 3, No. 4: 112-117, 9. Gonsalves, G.C. et.al. 1999, A Customer Resource Life Cycle interpretation of the Impact of the World Wide Web on Competitiveness: Expectations and Achievements. 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Business and Sustainable Development Special Vol. 15, No. 7; 659-67 Tembo, R., 2008, Information and Communication Technology Usage Trends and Factors in Commercial Agriculture in the Wine Industry. [pdf] Available at: http://digitalknowledge.cput.ac.za/xmlui/bitstream/handle/11189/218/information%20and%20communication%20technology%20usgae%20trends%20and%20factors.pdf?sequence=1 [Accessed 14th May 2014] Read More