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Unit 4 Assignment
Assignment: Business Marketing
In this Assignment, you will create an audiovisual presentation
to verbally market a product to
another business rather than to consumers.
According to Lamb et al. (2014), business marketing differs
from marketing to consumers only in
terms of the use of the products or services ─ leaving out the
consumer. Business marketing
entails marketing to persons and businesses who will then offer
it to consumers. These products
can include parts of goods or those that are used to manufacture
other products, or services
used by organizations to operate more efficiently or that are
later resold. To demonstrate your
comprehension of Business Marketing, read the following
scenario and follow the directions to
complete this Assignment.
Scenario:
You have just been hired as a new Business-to-Business (B2B)
marketing associate with ZMX
Global, inc., a national distributor of food, beverage, and
supplies to hospitality oriented
businesses. As part of your marketing training, you have been
tasked with finding new
marketing opportunities (Retailers, wholesalers, Internet,
institutions, etc.) for the distribution of
a new product called “Bon Vivant Organic Gourmet,” a high
quality organic frozen food product.
Read the BonVivant Business and Product Profile: Click Here.
Your job as a B2B marketing associate is to build relationships
with reputable organizations that
will successfully represent ZMX Global, Inc. and the Bon
Vivant Organic Gourmet brand and
product with integrity.
Directions:
Using what you learn from reading Chapter 7 to inform your
work on this Assignment, build a 5-
slide audio visual presentation using Microsoft PowerPoint with
audio covering the
characteristics that make Bon Vivant Organic Gourmet a
business product.
(This is where your microphone either built into your computer
in most cases or alternatively
your microphone headset you purchased, will be used.)
For a tutorial on adding audio to your PowerPoint presentation,
click here.
Checklist: Include the following information:
Slide 1: Title Slide. Include your name, date, title of the
presentation.
○ Oral narration: Introduce yourself and the topic of your
presentation.
○ Notes: Narration Script
Slide 2: Describe what type of business product ZMX Global,
Inc. offers in the Bon
Vivant Organic Gourmet frozen meal product line. Discuss why
it can be considered a
business product.
http://extmedia.kaplan.edu/business/AB219/1403C/Misc/Bon_V
ivant_Organic_Gourmet.pdf
http://extmedia.kaplan.edu/business/AB219/1403C/Misc/U4Tuto
rial.pdf
○ Oral Narration: Explain your decision.
○ Notes: Narration Script
Slide 3: Identify a business customer category (producer,
reseller, government, or
institutions) to focus relationship marketing and strategic
alliance efforts in the sale of
Bon Vivant Organic Gourmet frozen meals.
○ Oral Narration: Explain why you chose the business customer
category.
○ Notes: Narration Script
Slide 4: Outline how the Internet can assist in B2B marketing
efforts of the Bon Vivant
Organic Gourmet product line.
○ Oral Narration: Describe your ideas on this topic.
○ Notes: Narration Script
Slide 5: Discuss the business market characteristics (see starting
on page 117 in your
chapter Reading) of the Bon Vivant Organic Gourmet product
line. Identify a minimum of
three (3) business market characteristics on the slide.
○ Oral Narration: Briefly discuss the three (3) business market
characteristics.
○ Notes: Narration Script
Slide 6: References slide. Provide an APA style formatted
References for your
textbook.
○ Oral Narration: Concluding remarks and state the References
for your textbook.
○ Notes: Narration Script
Directions for Submitting this Assignment:
Review the grading rubric below before beginning this activity.
For additional help with
your writing and APA format and citation style, please visit the
Kaplan University Writing
Center. Compose your Assignment as a Microsoft PowerPoint
with audio presentation and
save it as (Example: TAllen-MT219 Assignment-Unit 3.ppt).
Submit your file by selecting
the Unit 4: Assignment Dropbox by the end of Unit 4.
Unit 4 Points
possible
Points
Earned
Comments
Assignment
Content per
Checklists
50
Response provides
complete information
demonstrating
analysis and critical
thinking. Note:
Highlighted areas
denote oral
presentation
portion, each worth
3 points each.
Slide 1: Provide title
slide with name, date
and title of presentation.
Introduce yourself and
the topic of your
presentation.
5
Slide 2: Describe what
type of business product
ZMX Global, Inc. offers
in the Bon Vivant
Organic Gourmet frozen
meal product line.
Discuss why it can be
considered a business
product. Explain your
decision.
7
Slide 3: Identify a
business customer
category (producer,
reseller, government, or
institutions) to focus
relationship marketing
and strategic alliance
efforts in the sale of Bon
Vivant Organic Gourmet
frozen meals. Explain
why you chose the
business customer
category.
7
Slide 4: Outline how the
Internet can assist in
B2B marketing efforts of
the Bon Vivant Organic
Gourmet product line.
Describe your ideas on
this topic.
7
Slide 5: Discuss the
business market
characteristics (see
starting on page 117 in
your chapter Reading) of
the Bon Vivant Organic
Gourmet product line.
Identify a minimum of
three (3) business
market characteristics on
the slide. Briefly discuss
the three (3) business
market characteristics.
7
Slide 6: Concluding
remarks in oral narration
and provide an APA
formatted reference slide
for your textbook.
7
Subtotal:
80%
40
Provides an audio visual
presentation consisting
of 6 slides with notes
and narration using
correct grammar,
spelling, and APA
citation/format style.
20%
10
Percent Total
Points
possible
Your Assignment
Score:
100% 50
Information Systems Strategy Triangle
Business Strategy Elements
Organizational Strategy Elements
Information Strategy Elements
Impacts between the elements:
Industry Strategy Elements
Industry Organizational Strategy Elements
Industry Strategy Elements
Similarities and differences:
Main Issues:
Recommended actions and decisions:
Step 1: Create lists of case details that fit each side of the
triangle.
Step 2: Then look at each item and think about how that item
affects the other sides of the triangle.
Step 3: Take a look at the industry. Make a list of triangle
attributes you find. Compare the industry items with the case
company items.
Information Strategy
Organizational Strategy
Business Strategy
Step 4: What are the main issues of the case? How would
evaluate the options? What criteria would you use? How do the
triangle sides impact the options?
Step 5: What decisions and actions would you recommend to the
case company? What data supports your conclusions? Why
should the case company take your advice?
CMBA SuperStar
Panther ID: 007
Information Systems Strategy Triangle
Business Strategy Elements
Organizational Strategy Elements
Information Strategy Elements
Differentiation focuses of Orders-of-magnitude improvements
in logistics and services, reducing the cycle time and ensure
consistent delivery of quality products and services.
Improve visibility of the service business performance to
management, enabling it to provide more effective quality
service to customers.
Centralized customer service systems to dispatch service
mechanics. OTISLINE customer service centers.
Goal to be a recognized leader in service excellence among all
companies, streamlined manufacturing operations.
OTISLINE produces “excess” callback reports for various levels
of management.
Information from multiple Otis data sources, rapid response as
an important design element.
Institutionalized customer service, standard of work, process
flows, and metrics to govern every customer interaction and
every internal activity.
Involvement with district manager, regional vice president, and
president of the regional business to better reduce maintenance
contract cancellations.
Elevator monitoring application enabled by a microprocessor-
based elevator to monitor its control systems and log
performance statics, directly onto a distant computer. Linked to
the computers at headquarters
Design for sourcing to manufacture new equipment, installation,
and maintenance; needed to run with a customer-focused mind
Restructuring the company by eliminating several layers of
management and speeding communication between field
mechanics, customers and company management.
SIMBA program, standard interface, modular –based
architecture defining modules and subsystems, standard
terminology.
Regional driven product strategy to International market
placement, streamline lead-time in the supply chain to
manufacturing to the field on a global basis.
SIP (Sales and Installation Process), subject matter experts in
the areas of sales, field and order management and utilization of
a steering committee.
E*Logistics information transformation project, with CLC
regional contract logistics centers and subsystems integrators
(SSI), network technologies (intranets and the internet)
UTC proprietary program, ACE Achieving Competitive
Excellence,
Impacts between the Elements
OTIS used technology to change their business toward the
customer service side. They implemented multiple technology
programs to better align their business goals across all
strategies. They were able to implement this change with the
use of technology systems introduced that opened up the lines
of communication. Managers, presidents, team leaders and
customers were all able to talk to each other to provide the
services needed. The strategies had in-depth reporting
mechanisms in place to reach the customer. They focused on
keeping up with the latest trends and evaluating such decision
in customer service with the utilization of technology. All sides
of the triangle are in line with their initial directive, where one
side does not outweigh the other.
Industry Business Strategy Elements
Industry Organizational Strategy Elements
Industry Technology Strategy Elements
Integrated, centralized, and consolidated, steady demand, low
barriers to entry and high profitability
Limited channel for communication, all working together
instead of separate fragments.
IT integration computation
Multifunctional across geographical dispersed units and
prioritized view of goals across the enterprise
Emphasizing on the Enterprise not the System, by providing the
best customer service and functionality
Once Common Interface/decision making processor, all built in
the same code, using the same technology
Emphasis on value-chain, forecasting, having predictive powers,
adaptable to best fit the customers’ needs
Decision making process involving contractor, architect and
building owner, property manager
IT and IS Multifunctional systems in place to be utilized by
multiple departments/users
Build relationships between departments and different outlets to
better interact and conduct business, relying on internal
resources to reduce costs.
Workflow, Demand Evaluation, Enterprise information system
in place
Cost of service major importance, discounting and bundling.
Stable sales directly correlated with building cycles.
Institutionalized Customer Service and developed metrics of
govern customer interaction
Similarities
OTIS wanted to implement technology systems that provided
increased customer service. It would be integrated and globally
disperse so that all stakeholders are involved. Its main goal
was to provide better customer service directives for the
organization with the current behaviors of the industry
environment. Most of the things OTIS was doing were in line
with the common practices of the industry. Most of the things
listed above were taken into consideration and/or guided
management to move their strategies in that direction.
Differences:
OTIS saw that they could use technology to their advantage for
service excellence amongst the company. It was important for
them to focus highly on implementing technology since service
was historically accounted for as much higher portion of profits
than new unit sales. In the industry you won’t see many
companies switch directions as OTIS did (producer to servicer)
due to the risks. By making these switches they were more
profitable, without technology they may have not been as
successful. The biggest difference compared to industry is
that most companies would have not made this switch.
Main Issues:
OTIS regionally managed many of their processes which made
redundancy, overall inefficiency and process complexity. Otis
needed to implement integrated systems and reorganize its
global functions. Otis had to figure out whether or not to
produce components in its value chain and decide where/how to
centralize their efforts. There was concern with organizing the
supply chain to become the coordinators of multiple global
suppliers located in various parts of the world. They needed to
consolidate the investing and business priorities process;
streamlining it into more efficient procedures. They needed to
develop a system that reflected best practices and best means
for their customers, by transforming the decision-making
process and making it more transparent.
Recommendation and Decisions:
The company needed to focus on the customer and how they
could best accommodate their needs. Once that is established
they need to decide what IT processes need to be implemented
to best fit those needs. The goal was to become the leader in
service excellence to do so by consolidation of technical
elements and centralized the business strategy decisions. They
need to make business decisions with that goal in mind and IT
investment to support customer service successfully. As long
as it is in line with the business and organizational strategies by
benefiting the customers, they have made the correct decision.
Business Strategy
Information Strategy
Organizational Strategy
Step 1: Create lists of case details that fit each side of the
triangle.
Step 2: Then look at each item and think about how that item
affects the other sides of the triangle.
Step 3: Take a look at the industry. Make a list of triangle
attributes you find. Compare the industry items with the case
company items.
Chapter 7 / Electronic Business Systems ● 215
REAL WORLD CASE 1
Hilton Hotels Corporation: Data-Driven Hospitality
Hilton Hotels Corporation has learned that customers are more
satisfied when they have hotel staff takes care of it than if the
stay goes flaw-
lessly. Giving hotel staff the information to make critical re-
coveries is the reason Hilton, during one of the industry’s worst
downturns in decades, piled $50 million into a custom- built
customer relationship management (CRM) information system
that has been integrated to cover 22 million guests in every
property across the eight brands that Hilton owns. “The
hospitality industry is a people business,” says CIO Tim
Harvey. “It doesn’t do any good to have great customer infor-
mation that’s only in the reservations system and available to
the call center. We need to have it common across all systems.”
Hilton is putting its CRM system, called OnQ, to the test in a
high-stakes expansion program. As the industry re- gains
momentum, Hilton is opening an estimated 275 hotels by the
end of 2005. OnQ is the IT centerpiece of a 2-year- old Hilton
CRM strategy, officially known as “Customers really matter.”
The strategy is pinned on the idea that employees with a clearer
idea of who customers are and what their past Hilton
experiences have been can engineer constant improvement.
There are plenty of risks in the strategy. For one, Hilton needs
to present its deep customer histories clearly enough that
employees at the front desks, where turnover averages more
than 100 percent a year, can put it to use. And Hilton is trying
to use the integrated information system to build loy- alty with
customers across an incredibly diverse mix of eight hotel
brands—so the same customer is recognized checking into a $79
room at Hampton Inn in Davenport, Iowa, or a $540 suite at the
Hilton Hawaiian Village in Honolulu.
The risk Harvey and his team know they need to guard against
is hitting a hotel staff with so much information, or doing it in
such a disruptive way, that it prevents employees from
interacting with guests and making judgments.
A lot of love and sweat went into building OnQ, a system that’s
about 70 percent custom-coded. The custom compo- nents
include a property-management system, the CRM application,
and a hotel owner-reporting module.
The system is delivered as an IT service to the franchise
dominated chain. Hilton owns just 52 of its 2,216 hotels, and
franchisees license the software, paying Hilton annual fees that
work out to about three-fourths of 1 percent of a hotel’s
revenue.
Hilton’s IT leadership is stacked with hotel industry vet- erans
who have no trouble defining IT success in terms of how
quickly guests get to their rooms and whether the rooms are
what they asked for. Harvey looks at it this way: If guests are
disappointed, eventually Hilton’s shareholders will be, too. “We
are passionate that our brand is only as good as our customers
think we are,” he says.
OnQ’s $50 million price tag makes it by far Hilton’s largest
technology investment of the past several years.
For OnQ to fulfill its mission, it needs to do more than deliver
information; it needs to be a decision-support tool. For example,
if a guest has complained in the past about be- ing bumped from
an overbooked hotel and moved to an- other Hilton property, the
system will highlight that history should the same situation
come up, thus making it less likely a hotel will ask that
customer to “walk” again.
One way OnQ already is yielding measurable benefits is in its
ability to match customer reservations with profile database
records. Before the system’s deployment, just 2 of every 10
guest reservations could be matched to an existing profile. With
OnQ, it’s matching 4.7, and Hilton says that number can be
closer to 6.
Such success brings a smile to the face of Chuck Scoggins,
senior director of Hilton.com and a key figure in the OnQ
development project. Each customer profile in- cludes a variety
of information, from credit card data and stay histories to
frequent-flier miles and room preferences, all of which can be
used to match people to their profiles. The company considers
its matching technology, which lets the front desk search
through 180 million records and get answers almost instantly, to
be critical intellectual property. “These are our algorithms, and
we believe they’re the best in the industry,” Scoggins says.
That’s why Hilton continues to custom-build most of its
software instead of buying off the shelf. “I’m reluctant to
replace something we’ve worked so hard on until we can be sure
it will be a significant improve- ment,” Scoggins says.
While OnQ helps Hilton run its existing operations, the
system’s real return will be measured by whether it lets the
company reinvent what it does and what it offers customers.
Harvey hasn’t lost sight of the more distant future. Hilton’s
540-person IT staff spends about $132 million a year—about 2
percent of revenue—on IT. About $1 million of that goes to true
research and development investigating emerging technologies.
“Too often, we forget to think about innovation in the rush to
meet business objectives,” Harvey says. “We get so intent on
trying to deliver, but that thinking outside of the box is crucial
to our future success.”
Case Study Questions
1. What are the benefits and drawbacks of the OnQ
system at Hilton?
2. What does Hilton have to do to create a competitive
advantage through OnQ? Provide some specific examples.
3. Is it possible to have too much information about a customer?
Explain.
Source: Adapted from Tony Kontzer, “Data Driven Hospitality,”
InformationWeek, August 2, 2004. Copyright © 2004 CMP
Media LLP.

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Unit 4 Assignment Assignment Business Marketing In t.docx

  • 1. Unit 4 Assignment Assignment: Business Marketing In this Assignment, you will create an audiovisual presentation to verbally market a product to another business rather than to consumers. According to Lamb et al. (2014), business marketing differs from marketing to consumers only in terms of the use of the products or services ─ leaving out the consumer. Business marketing entails marketing to persons and businesses who will then offer it to consumers. These products can include parts of goods or those that are used to manufacture other products, or services used by organizations to operate more efficiently or that are later resold. To demonstrate your comprehension of Business Marketing, read the following scenario and follow the directions to complete this Assignment. Scenario: You have just been hired as a new Business-to-Business (B2B) marketing associate with ZMX
  • 2. Global, inc., a national distributor of food, beverage, and supplies to hospitality oriented businesses. As part of your marketing training, you have been tasked with finding new marketing opportunities (Retailers, wholesalers, Internet, institutions, etc.) for the distribution of a new product called “Bon Vivant Organic Gourmet,” a high quality organic frozen food product. Read the BonVivant Business and Product Profile: Click Here. Your job as a B2B marketing associate is to build relationships with reputable organizations that will successfully represent ZMX Global, Inc. and the Bon Vivant Organic Gourmet brand and product with integrity. Directions: Using what you learn from reading Chapter 7 to inform your work on this Assignment, build a 5- slide audio visual presentation using Microsoft PowerPoint with audio covering the characteristics that make Bon Vivant Organic Gourmet a business product. (This is where your microphone either built into your computer in most cases or alternatively
  • 3. your microphone headset you purchased, will be used.) For a tutorial on adding audio to your PowerPoint presentation, click here. Checklist: Include the following information: Slide 1: Title Slide. Include your name, date, title of the presentation. ○ Oral narration: Introduce yourself and the topic of your presentation. ○ Notes: Narration Script Slide 2: Describe what type of business product ZMX Global, Inc. offers in the Bon Vivant Organic Gourmet frozen meal product line. Discuss why it can be considered a business product. http://extmedia.kaplan.edu/business/AB219/1403C/Misc/Bon_V ivant_Organic_Gourmet.pdf http://extmedia.kaplan.edu/business/AB219/1403C/Misc/U4Tuto rial.pdf ○ Oral Narration: Explain your decision. ○ Notes: Narration Script
  • 4. Slide 3: Identify a business customer category (producer, reseller, government, or institutions) to focus relationship marketing and strategic alliance efforts in the sale of Bon Vivant Organic Gourmet frozen meals. ○ Oral Narration: Explain why you chose the business customer category. ○ Notes: Narration Script Slide 4: Outline how the Internet can assist in B2B marketing efforts of the Bon Vivant Organic Gourmet product line. ○ Oral Narration: Describe your ideas on this topic. ○ Notes: Narration Script Slide 5: Discuss the business market characteristics (see starting on page 117 in your chapter Reading) of the Bon Vivant Organic Gourmet product line. Identify a minimum of three (3) business market characteristics on the slide. ○ Oral Narration: Briefly discuss the three (3) business market characteristics. ○ Notes: Narration Script
  • 5. Slide 6: References slide. Provide an APA style formatted References for your textbook. ○ Oral Narration: Concluding remarks and state the References for your textbook. ○ Notes: Narration Script Directions for Submitting this Assignment: Review the grading rubric below before beginning this activity. For additional help with your writing and APA format and citation style, please visit the Kaplan University Writing Center. Compose your Assignment as a Microsoft PowerPoint with audio presentation and save it as (Example: TAllen-MT219 Assignment-Unit 3.ppt). Submit your file by selecting the Unit 4: Assignment Dropbox by the end of Unit 4. Unit 4 Points possible Points Earned
  • 6. Comments Assignment Content per Checklists 50 Response provides complete information demonstrating analysis and critical thinking. Note: Highlighted areas denote oral presentation portion, each worth 3 points each.
  • 7. Slide 1: Provide title slide with name, date and title of presentation. Introduce yourself and the topic of your presentation. 5 Slide 2: Describe what type of business product ZMX Global, Inc. offers in the Bon Vivant Organic Gourmet frozen meal product line. Discuss why it can be considered a business product. Explain your decision. 7 Slide 3: Identify a business customer category (producer, reseller, government, or
  • 8. institutions) to focus relationship marketing and strategic alliance efforts in the sale of Bon Vivant Organic Gourmet frozen meals. Explain why you chose the business customer category. 7 Slide 4: Outline how the Internet can assist in B2B marketing efforts of the Bon Vivant Organic Gourmet product line. Describe your ideas on this topic. 7 Slide 5: Discuss the business market
  • 9. characteristics (see starting on page 117 in your chapter Reading) of the Bon Vivant Organic Gourmet product line. Identify a minimum of three (3) business market characteristics on the slide. Briefly discuss the three (3) business market characteristics. 7 Slide 6: Concluding remarks in oral narration and provide an APA formatted reference slide for your textbook. 7 Subtotal:
  • 10. 80% 40 Provides an audio visual presentation consisting of 6 slides with notes and narration using correct grammar, spelling, and APA citation/format style. 20% 10 Percent Total Points possible Your Assignment
  • 11. Score: 100% 50 Information Systems Strategy Triangle Business Strategy Elements Organizational Strategy Elements Information Strategy Elements Impacts between the elements:
  • 12. Industry Strategy Elements Industry Organizational Strategy Elements Industry Strategy Elements Similarities and differences: Main Issues: Recommended actions and decisions: Step 1: Create lists of case details that fit each side of the triangle. Step 2: Then look at each item and think about how that item affects the other sides of the triangle. Step 3: Take a look at the industry. Make a list of triangle attributes you find. Compare the industry items with the case company items. Information Strategy
  • 13. Organizational Strategy Business Strategy Step 4: What are the main issues of the case? How would evaluate the options? What criteria would you use? How do the triangle sides impact the options? Step 5: What decisions and actions would you recommend to the case company? What data supports your conclusions? Why should the case company take your advice? CMBA SuperStar Panther ID: 007 Information Systems Strategy Triangle Business Strategy Elements Organizational Strategy Elements Information Strategy Elements Differentiation focuses of Orders-of-magnitude improvements in logistics and services, reducing the cycle time and ensure consistent delivery of quality products and services. Improve visibility of the service business performance to management, enabling it to provide more effective quality
  • 14. service to customers. Centralized customer service systems to dispatch service mechanics. OTISLINE customer service centers. Goal to be a recognized leader in service excellence among all companies, streamlined manufacturing operations. OTISLINE produces “excess” callback reports for various levels of management. Information from multiple Otis data sources, rapid response as an important design element. Institutionalized customer service, standard of work, process flows, and metrics to govern every customer interaction and every internal activity. Involvement with district manager, regional vice president, and president of the regional business to better reduce maintenance contract cancellations. Elevator monitoring application enabled by a microprocessor- based elevator to monitor its control systems and log performance statics, directly onto a distant computer. Linked to the computers at headquarters Design for sourcing to manufacture new equipment, installation, and maintenance; needed to run with a customer-focused mind Restructuring the company by eliminating several layers of management and speeding communication between field mechanics, customers and company management. SIMBA program, standard interface, modular –based architecture defining modules and subsystems, standard terminology. Regional driven product strategy to International market placement, streamline lead-time in the supply chain to manufacturing to the field on a global basis. SIP (Sales and Installation Process), subject matter experts in the areas of sales, field and order management and utilization of a steering committee. E*Logistics information transformation project, with CLC regional contract logistics centers and subsystems integrators (SSI), network technologies (intranets and the internet)
  • 15. UTC proprietary program, ACE Achieving Competitive Excellence, Impacts between the Elements OTIS used technology to change their business toward the customer service side. They implemented multiple technology programs to better align their business goals across all strategies. They were able to implement this change with the use of technology systems introduced that opened up the lines of communication. Managers, presidents, team leaders and customers were all able to talk to each other to provide the services needed. The strategies had in-depth reporting mechanisms in place to reach the customer. They focused on keeping up with the latest trends and evaluating such decision in customer service with the utilization of technology. All sides of the triangle are in line with their initial directive, where one side does not outweigh the other. Industry Business Strategy Elements Industry Organizational Strategy Elements Industry Technology Strategy Elements Integrated, centralized, and consolidated, steady demand, low barriers to entry and high profitability Limited channel for communication, all working together instead of separate fragments. IT integration computation Multifunctional across geographical dispersed units and prioritized view of goals across the enterprise Emphasizing on the Enterprise not the System, by providing the best customer service and functionality Once Common Interface/decision making processor, all built in the same code, using the same technology Emphasis on value-chain, forecasting, having predictive powers, adaptable to best fit the customers’ needs Decision making process involving contractor, architect and building owner, property manager
  • 16. IT and IS Multifunctional systems in place to be utilized by multiple departments/users Build relationships between departments and different outlets to better interact and conduct business, relying on internal resources to reduce costs. Workflow, Demand Evaluation, Enterprise information system in place Cost of service major importance, discounting and bundling. Stable sales directly correlated with building cycles. Institutionalized Customer Service and developed metrics of govern customer interaction Similarities OTIS wanted to implement technology systems that provided increased customer service. It would be integrated and globally disperse so that all stakeholders are involved. Its main goal was to provide better customer service directives for the organization with the current behaviors of the industry environment. Most of the things OTIS was doing were in line with the common practices of the industry. Most of the things listed above were taken into consideration and/or guided management to move their strategies in that direction. Differences: OTIS saw that they could use technology to their advantage for service excellence amongst the company. It was important for them to focus highly on implementing technology since service was historically accounted for as much higher portion of profits than new unit sales. In the industry you won’t see many companies switch directions as OTIS did (producer to servicer) due to the risks. By making these switches they were more profitable, without technology they may have not been as
  • 17. successful. The biggest difference compared to industry is that most companies would have not made this switch. Main Issues: OTIS regionally managed many of their processes which made redundancy, overall inefficiency and process complexity. Otis needed to implement integrated systems and reorganize its global functions. Otis had to figure out whether or not to produce components in its value chain and decide where/how to centralize their efforts. There was concern with organizing the supply chain to become the coordinators of multiple global suppliers located in various parts of the world. They needed to consolidate the investing and business priorities process; streamlining it into more efficient procedures. They needed to develop a system that reflected best practices and best means for their customers, by transforming the decision-making process and making it more transparent. Recommendation and Decisions: The company needed to focus on the customer and how they could best accommodate their needs. Once that is established they need to decide what IT processes need to be implemented to best fit those needs. The goal was to become the leader in service excellence to do so by consolidation of technical elements and centralized the business strategy decisions. They need to make business decisions with that goal in mind and IT investment to support customer service successfully. As long as it is in line with the business and organizational strategies by benefiting the customers, they have made the correct decision. Business Strategy Information Strategy
  • 18. Organizational Strategy Step 1: Create lists of case details that fit each side of the triangle. Step 2: Then look at each item and think about how that item affects the other sides of the triangle. Step 3: Take a look at the industry. Make a list of triangle attributes you find. Compare the industry items with the case company items. Chapter 7 / Electronic Business Systems ● 215 REAL WORLD CASE 1 Hilton Hotels Corporation: Data-Driven Hospitality Hilton Hotels Corporation has learned that customers are more satisfied when they have hotel staff takes care of it than if the stay goes flaw- lessly. Giving hotel staff the information to make critical re- coveries is the reason Hilton, during one of the industry’s worst downturns in decades, piled $50 million into a custom- built customer relationship management (CRM) information system that has been integrated to cover 22 million guests in every property across the eight brands that Hilton owns. “The hospitality industry is a people business,” says CIO Tim
  • 19. Harvey. “It doesn’t do any good to have great customer infor- mation that’s only in the reservations system and available to the call center. We need to have it common across all systems.” Hilton is putting its CRM system, called OnQ, to the test in a high-stakes expansion program. As the industry re- gains momentum, Hilton is opening an estimated 275 hotels by the end of 2005. OnQ is the IT centerpiece of a 2-year- old Hilton CRM strategy, officially known as “Customers really matter.” The strategy is pinned on the idea that employees with a clearer idea of who customers are and what their past Hilton experiences have been can engineer constant improvement. There are plenty of risks in the strategy. For one, Hilton needs to present its deep customer histories clearly enough that employees at the front desks, where turnover averages more than 100 percent a year, can put it to use. And Hilton is trying to use the integrated information system to build loy- alty with customers across an incredibly diverse mix of eight hotel brands—so the same customer is recognized checking into a $79 room at Hampton Inn in Davenport, Iowa, or a $540 suite at the Hilton Hawaiian Village in Honolulu. The risk Harvey and his team know they need to guard against is hitting a hotel staff with so much information, or doing it in such a disruptive way, that it prevents employees from interacting with guests and making judgments. A lot of love and sweat went into building OnQ, a system that’s about 70 percent custom-coded. The custom compo- nents include a property-management system, the CRM application, and a hotel owner-reporting module. The system is delivered as an IT service to the franchise dominated chain. Hilton owns just 52 of its 2,216 hotels, and franchisees license the software, paying Hilton annual fees that work out to about three-fourths of 1 percent of a hotel’s revenue. Hilton’s IT leadership is stacked with hotel industry vet- erans who have no trouble defining IT success in terms of how quickly guests get to their rooms and whether the rooms are
  • 20. what they asked for. Harvey looks at it this way: If guests are disappointed, eventually Hilton’s shareholders will be, too. “We are passionate that our brand is only as good as our customers think we are,” he says. OnQ’s $50 million price tag makes it by far Hilton’s largest technology investment of the past several years. For OnQ to fulfill its mission, it needs to do more than deliver information; it needs to be a decision-support tool. For example, if a guest has complained in the past about be- ing bumped from an overbooked hotel and moved to an- other Hilton property, the system will highlight that history should the same situation come up, thus making it less likely a hotel will ask that customer to “walk” again. One way OnQ already is yielding measurable benefits is in its ability to match customer reservations with profile database records. Before the system’s deployment, just 2 of every 10 guest reservations could be matched to an existing profile. With OnQ, it’s matching 4.7, and Hilton says that number can be closer to 6. Such success brings a smile to the face of Chuck Scoggins, senior director of Hilton.com and a key figure in the OnQ development project. Each customer profile in- cludes a variety of information, from credit card data and stay histories to frequent-flier miles and room preferences, all of which can be used to match people to their profiles. The company considers its matching technology, which lets the front desk search through 180 million records and get answers almost instantly, to be critical intellectual property. “These are our algorithms, and we believe they’re the best in the industry,” Scoggins says. That’s why Hilton continues to custom-build most of its software instead of buying off the shelf. “I’m reluctant to replace something we’ve worked so hard on until we can be sure it will be a significant improve- ment,” Scoggins says. While OnQ helps Hilton run its existing operations, the system’s real return will be measured by whether it lets the company reinvent what it does and what it offers customers.
  • 21. Harvey hasn’t lost sight of the more distant future. Hilton’s 540-person IT staff spends about $132 million a year—about 2 percent of revenue—on IT. About $1 million of that goes to true research and development investigating emerging technologies. “Too often, we forget to think about innovation in the rush to meet business objectives,” Harvey says. “We get so intent on trying to deliver, but that thinking outside of the box is crucial to our future success.” Case Study Questions 1. What are the benefits and drawbacks of the OnQ system at Hilton? 2. What does Hilton have to do to create a competitive advantage through OnQ? Provide some specific examples. 3. Is it possible to have too much information about a customer? Explain. Source: Adapted from Tony Kontzer, “Data Driven Hospitality,” InformationWeek, August 2, 2004. Copyright © 2004 CMP Media LLP.