E-Business transformation-Sears Case Study


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E-Business transformation-Sears Case Study

  1. 1. E-BUSINESS TRANSFORMATION AT THE CROSSROADS : DILEMMA Kelompok 2: Danny D. Kosasih – Diah Saragih – Gede Arya – Hari Tarigan System Information Technology Case Study & Discussion MM UGM AP 6B
  2. 2. CONTENT <ul><li>Sears History </li></ul><ul><li>Issues & Challenges </li></ul><ul><li>3 IT Strategic Challenges </li></ul><ul><li>U.S Retail Industry Review </li></ul><ul><li>Trends In Online Sales </li></ul><ul><li>Key E-Business Initiative At Sears </li></ul><ul><li>Acquisition of Land’s End </li></ul><ul><li>E-Commerce Business Models & Strategy </li></ul>
  3. 3. Sears History <ul><li>1888 - the company started in catalog business </li></ul><ul><li>1925 - expanded into retail store operations. </li></ul><ul><li>Sears, Roebuck and Company becoming an icon in US retailing industry in the following decades. </li></ul><ul><li>1992 - Sears hired a new Arthur C. Martinez, the pioneer of Sear’s online sales. </li></ul><ul><li>1886 - Richard Sears began the R W Sears Watch Company in Minnesota. </li></ul><ul><li>1887 - Collaborate with A. Roebuck, and built Sears, Roebuck and Company. </li></ul>
  4. 4. Issues & Challenge <ul><li>Net Income fall $1.343 million (2000) to $735 million (2001) with revenue level of $41.1 billion </li></ul><ul><li>Broad range of product (appliances to apparel) </li></ul><ul><ul><li>Dilemma whether to have multiple sites or unified & integrated sites </li></ul></ul><ul><li>Foray into B2B e-commerce  GlobalNetExchange partnership with Oracle Corp, Carrefour, IBM, etc in order to cut costs </li></ul><ul><li>Acquired Land’s End (2002), the largest US based specialty apparel company. </li></ul><ul><li>How to synergize Sear’s and Land’s End business </li></ul><ul><li>How Sears take advantage of Land’s End strengths to improve its own business effort </li></ul>
  5. 5. 3 IT Strategic Challenges <ul><li>What was the best way to utilize the website and internet to attract and sell a varied range of products? </li></ul><ul><li>How should Sear’s extended and enhance its B2B e-commerce initiatives to stay ahead of the pack and beat the competition? </li></ul><ul><li>Could Sear’s utilize Land’s End technological and operations capabilities to turn around its e-business? </li></ul>Sears’s Tower
  6. 6. US Retail Industry Review
  7. 7. Trends In Online Sale
  8. 8. Key Business Initiative @ Sears
  9. 9. Acquisition’s Of Land’s End’s
  10. 10. Recommended Actions <ul><li>Optimize the IT technology to develop its e-business, if necessary, use IT external expertise. </li></ul><ul><li>Sear’s have to utilize the technology from Land’s End website in order to apply the same features and benefits. </li></ul><ul><li>However, branded products stay on Land’s End website  </li></ul>
  11. 11. Industrial Competition (e-Retailers) Sears.com JCPenney.com BestBuy.com Modifikasi model dikutip dari Harvard Business Review, Maret 2001 SUPPLIER BUYER / End User POTENTIAL ENTRANTS SUBSTITUTIONS <ul><li>Traditional mall-based stores </li></ul><ul><li>Traditional retail stores </li></ul><ul><li>Apparels </li></ul><ul><li>Appliances </li></ul><ul><li>Wholesalers & Jobbers </li></ul><ul><li>etc </li></ul><ul><li>Web Portals & Web Search Engines </li></ul><ul><li>Thousands of independent retailers in USA go online / e-commerce </li></ul><ul><li>CUSTOMERS </li></ul><ul><li>Type of Buyers </li></ul><ul><ul><li>Consumers </li></ul></ul><ul><li>Market Place </li></ul><ul><ul><li>USA </li></ul></ul><ul><ul><li>North America </li></ul></ul><ul><li>Cyber Space; Cybernauts Segments </li></ul><ul><li>DISTRIBUTION Channels </li></ul><ul><li>Web Portal </li></ul><ul><li>$avers.com </li></ul>Environmental Scanning (e.g.) - Wall Street Opinion - New Technology - Market Shifting - - Life Style, etc. Internet & E-Commerce Business Situation and Further Trend Click & Mortar’s - Present Market - Future Market E-Retailers Industry & Competitive Analysis
  12. 12. The E-Market System Competition COMPANY Competitors End-User Market The Core Market System The Macro Environment Economics Politics Legislation Technology Finance Culture INTERMEDIARIES Distribution End-User Outlets
  13. 13. The E-Commerce Competence Clear e-market opportunity Appropriate e-market positioning Formal plan to exploit e-market opportunities A qualitative model of competences to support & deliver an e-commerce marketing strategy Strategic e-market competencies Financial resources to support e-market operation Financial resources competencies Innovative e-market product & services Workforce with appropriate e-market skills Quality to meet expectations of e-market customers Productivity supportive of e-market operations Information System Capable of providing real time of e-market support
  14. 14. Individual Customer Contact Database The E-Management System An integrated e-commerce management system Marketing Pre-Sales Sales Post-Sales Support Billing Quality Control Field Service Delivery Individual Customer Contact Database Production, Procurement, Logistics and Operations Accounting Other supporting activities and services like mentioned in Porter’s Value Chain Internet Interface Suppliers Consolidated Customer Database Transaction engine and database
  15. 15. The E-Strategy Options Adopted from “ e-commerce B2C” model of University of Pelita Harapan Low Mid Hi Being The Pioneer Watch It & Follow It Buck The Trend % of target consumers who are determined as e-shoppers Information Only Subsume into existing business Export Treat as another channel Setup as separate business Pursue on all fronts Mixed System Switch Fully Best of Both Risk & Return Level Barnes & Noble Barnes & Noble.Com Amazon.Com
  16. 16. The E-Strategy Options