Case Studiess10 video case study.pdfManagement Informatio.docx

Case Studiess/10 video case study.pdf
Management Information Systems 13e
KENNETH C. LAUDON AND JANE P. LAUDON
continued
Systems
CHAPTER 10 E-COMMERCE: DIGITAL MARKETS,
DIGITAL GOODS
CASE 3 Ford AutoXchange B2B Marketplace
SUMMARY This is a fascinating story on a B2B “electronic
marketplace” initially developed by Ford
called AutoXchange. In this vision of B2B commerce, the
Internet would transform the
relationship between over 100,000 tier 1 and tier 2 auto parts
suppliers, and a small
handful of very large, global automobile companies. In this
electronic marketplace,
thousands of suppliers would compete against one another to
provide parts to the auto
industry giants. In this way, the auto industry hoped to reduce
the cost of parts, increase
quality, achieve greater flexibility, and rationalize the supply
chain process. Ultimately, the
effort failed. Find out why. L= 4:58.
URL http://www.youtube.com/watch?v=qyO9QSo0FjU

CASE The automotive industry designs, develops,
manufactures, markets, and sells the world’s
motor vehicles. In 2007, more than 73 million motor vehicles,
including cars and commercial
vehicles were produced worldwide. In 2011, more than 65
million motor vehicles, including
cars and commercial vehicles, were produced worldwide. In
2011, a total of 64 million new
automobiles were sold worldwide: 16.8 million in Europe, 22.5
million in Asia-Pacific, 15.2
million in the USA and Canada, 4.6 million in Latin America,
2.8 million in the Middle East
and 1.8 million in Africa.
Because of the global financial meltdown and recession
beginning in 2007, auto production
worldwide has fallen 20 percent, and even more in Europe.
Asia, Russia, and Latin American
auto markets rose in unit sales during the period.
General Motors, Ford and Chrysler are not only by far the
largest automakers in North
America, they were for a while the largest in the world and are
still a mainstay in the top
http://www.youtube.com/watch?v=qyO9QSo0FjU
Chapter 10, Case 3 Ford autoXChange B2B MarketplaCe 2
continued
ten. Ford has held the position of second-ranked automaker for
the previous 56 years, being
relegated to third in North American sales, after being

overtaken by Toyota in 2007. In 2011,
Ford ranked fifth in global auto production with 4.8 million
units, behind General Motors,
Volkswagen, Toyota, and Hyundai.
Ford Motor Company (NYSE: F) is an American multinational
corporation. Based in Dearborn,
Michigan, a suburb of Detroit, the automaker was founded by
Henry Ford and incorporated
on June 16, 1903. Ford’s former UK subsidiaries Jaguar and
Land Rover were sold to Tata
Motors of India in March 2008.
While the global auto industry is very large by any standard,
generating nearly $1 trillion
in sales worldwide each year, the size of the auto supplier
industry worldwide is equally
impressive. There are an estimated 250,000 direct suppliers to
the auto industry worldwide,
with about 100,000 suppliers in the U.S. alone. Coordinating the
flow of parts and sub-
assemblies (transmissions, differentials and axles, and sheet
metal) is a massive, and very
expensive task.
Ford’s AutoXchange was one of the first efforts to develop a
large scale B2B (business-to-
business) electronic marketplace for the automobile industry. In
the end, it did not succeed,
at least not in the form proposed in the video. Why it did not
succeed is an interesting story
of how mistakes in understanding industry supply chains led to
poorly conceptualized
information systems which ultimately did not work. While the
effort to build industry-wide
electronic marketplaces largely failed (and not just in the auto

industry), the ideas and
technologies were later used by individual firms separately.
Today, private firm industrial
networks (owned and operated by individual firms who invite a
select group of suppliers to
participate) are commonplace.
Ford’s AutoXchange was a grand vision of how Internet
technology would overcome
competitive pressures in an entire industry, and entice
thousands of industrial supply
businesses into an online, competitive marketplace where prices
would be driven down
through the workings of a transparent, online marketplace much
like the stock market.
The idea was quite simple: build a digital marketplace which
was open, transparent, and
competitive to benefit the large buyers of automotive parts.
These marketplaces were referred to as “B2B Markets” because
they brought together suppli-
ers businesses with purchasing businesses and did not involve
the consumer. Ultimately this
vision of open B2B markets came up against some powerful
institutional forces. As it turns
out, no rational business (or management team) wants to be a
seller in an open, transparent
marketplace where price is the most important and visible
criterion of success. As a result,
suppliers to these kinds of open digital markets often refused to
participate.
While the broad vision failed, many of the technologies
developed in this effort were
re-deployed by the companies involved, and survive today as
private supply chain networks

operated by the major car manufacturers.
continued
Your task in this case is to figure out why the original vision
did not work out as planned,
and what this tells you about the role that organizational and
institutional factors play in the
deployment of large technology projects.
One grand vision of the dot com era was an open transparent
marketplace where thou-
sands of suppliers would compete against one another to sell
their products to a few
giant purchasers. “A consortium of buyers can exert
considerable influence on a common
supply chain. In 1998 GM set up a B2B (business-to-business)
exchange for its auto parts
suppliers, initially called TradeXchange. The idea was to
streamline production by sharing
information electronically. At the time GM was spending about
$87 billion a year on
raw materials, vehicle parts, and MRO (materials, repair, and
operating) supplies with its
roughly 30,000 suppliers. GM would provide specifications and
information on inventory
and manufacturing schedules and suppliers would provide
information on price and
delivery capability. Trade Xchange supported an on-line
catalog, a bid-quote process,
or an on-line auction. Part of GM TradeXchange allowed
suppliers to solicit bids for their

raw materials, potentially cutting their costs. In the first two
months of operations, GM
sold stamping presses in two online auctions, reaping more than
$2 million in sales, and
purchased more than $1.7 million in materials from supplier
catalogs posted on the site.
As described in the video, Ford created a similar exchange
called AutoXchange with of
course different software, formats and interfaces. To solve this
problem for their common
suppliers Ford, GM and DaimlerChrysler announced in February
2000 that they had agreed
to join together to create a single B2B supplier exchange called
Covisint. The three firms had
combined annual spending of $240 billion.
The Federal Trade Commission started an informal antitrust
review of the Big Three
exchange but soon gave it clearance. In April 2000, French
automaker Renault S.A. and
Nissan of Japan joined. Also among the founding firms were
Commerce One, GM’s technol-
ogy partner in TradeXchange and Oracle Ford’s technology
partner in Auto-Xchange. In
April 2001 Kevin English was named Chairman, President and
CEO of Covisint.
Industry observers at the time wondered whether the two
companies hired to move all of
Ford and GM’s suppliers online had what it takes to get these
huge projects up and rolling
by the first quarter of the next year, as both promised. The feat
not only required enormous
commitment from suppliers, which will need to be convinced
they can save money, but also

huge technology and applications-hosting capabilities from the
companies picked for the
jobs: Oracle and Commerce One. Neither of these companies
had ever built such a huge
online trading platform.
Suppliers to the major auto OEMS felt that the Covisint was not
intended to optimize the
supplier chain but rather was just the latest tool to squeeze
revenue from suppliers. They
were particularly hostile to the online auction. There was
friction between the OEMs and
also technical difficulties due to differences in legacy systems.
Outside observers felt that
the big three were more interested in the market capitalization
of Covisint than in their
supply chains. Covsinit never achieved the level of success
envisioned. In December 2003
Covisint sold the online auction portion of its business to
FreeMarkets Inc, which agreed to
merge with Ariba soon after. In March 2004 Compuware
acquired the products and technol-
ogy of Covisint, LLC. It is believed that Covisint had about $25
million in annual revenue and
around 135,000 users.
But the ideas and technologies for creating online networks
which individual firms can use
to communicate and collaborate with their suppliers are alive
and well. There are few “open”
networks where thousands of suppliers compete with one

another, but there are many
“invitation only networks” where a few trusted suppliers are
allowed entry. All the major
automakers now operate these kinds of private networks. Price
competition is usually not
present, and the emphasis is on quality, just-in-time delivery,
and flexibility.
1. Who do you think would pay the cost for suppliers to put
their parts catalogs onto these
marketplaces like AutoXchange? Who should have paid costs?
2. What were the benefits of these systems and who would reap
them?
3. Why did the Federal Trade Commission open an investigation
of these marketplaces?
4. What role do you think the technology played in the demise
of these systems?
5. Why would more “closed” private market places be attractive
to both the industry giants
who buy the parts and the suppliers?
VIDEO CASE
QUESTIONS
COPYRIGHT NOTICE
Copyright © 2013 Kenneth Laudon.
This work is protected by United States copyright laws and is
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Dissemination or sale of any part of this work
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Case Studiess/11 Video Case Study.pdf
continued
Systems
CHAPTER 11 MANAGING KNOWLEDGE AND
COLLABORATION
CASE 2 Alfresco: Open Source Document Management and
Collaboration
(a) Tour: Alfresco Document Management System
URL http://www.youtube.com/watch?v=p266dTL6oJQ;
L=XXX
(b) Alfresco Document Management at the City of Denver (part
1)
URL http://www.youtube.com/watch?v=01bUAsD5t8E; L=
4:50
(c) Alfresco at the New York Philharmonic.
URL
http://www.youtube.com/watch?feature=player_embedded&v=U

WI5RZRC56A#!; L= 4:35
SUMMARY A central element in managing organizational
knowledge is developing systems that
can manage the documents which lie at the heart of all
organizations. Prior to the
development of document management systems, organizations
relied on physical copies
of documents to conduct their business which was both costly
and ineffective. Document
management systems digitize physical documents and store the
files in a database. This
allows documents to be accessed and shared both internally and
with customers. While
all large enterprise software firms provide document
management systems, Alfresco is
unique because it is an open source software platform and much
more affordable than
solutions from traditional vendors.
CASE Alfresco Software, Ltd. Is a software firm based in the
United Kingdom that offers an open-
source enterprise content management and collaboration
platform. Alfresco’s platform
provides content management, Web content management,
collaboration, content platform
http://www.youtube.com/watch?v=p266dTL6oJQ
http://www.youtube.com/watch?v=01bUAsD5t8E
http://www.youtube.com/watch?feature=player_embedded&v=U
WI5RZRC56A#!
Chapter 11 , CaSe 2 aLFreSCO: OpeN SOUrCe DOCUMeNt
MaNaGeMeNt 2

continued
and repository, image management, and content management
interoperability services to
enterprise customers. The company was found in 2002 in
Maidenhead, United Kingdom,
by former executives of Documentum and Oracle. Documentum
was one of the original
document management firms in the 1990s that developed
software to manage, organize,
and store millions of documents. They specifically focused on
unstructured information
found in documents, images, audio, and video, as opposed to
structured information typical
of customer record systems, which have a fixed format of fields
and records. For instance,
Documentum developed a customized system for Boeing to
organize, store, maintain,
and selectively publish the thousands of pages of information
for the Boeing 777 training
manuals which contained multiple file types, including text,
photos, and drawings.
Alfresco built on this early foundation by developing a
document sharing and collabora-
tion platform based on open-source software, open standards,
and licenced under various
open-source licenses. An open-source license is a copyright
license that makes the source
code available for everyone to use. This allows end users to
review and modify the source
code for their own customization and/or troubleshooting needs.
Open-source licenses are
also commonly free, allowing for modification, redistribution,
and commercial use without
having to pay the original author.

There are different versions of the Alfresco software, as well as
different licensing fees. The
Alfresco Community Edition is free software, open source and
open standard. The Enterprise
Edition is commercially licensed and proprietary, but builds on
the open-source founda-
tion. Modifications do not have to be shared with the larger
community. The Alfresco Cloud
edition is a SaaS version of the Enterprise edition that operates
on Amazon Web Services
(AWS) as of 2012.
1. How does Alfresco support a mobile business environment?
2. Why is Alfresco superior to email for supporting
collaboration?
3. What were the factors that caused the City of Denver to go
with the Alfresco platform as
opposed to more typical proprietary software from other
vendors?
4. What business process will Denver seek to automate in the
future using Alfresco, and
why use a document management system to automate this
process?
5. What problems did the New York Philharmonic seek to solve
with Alfresco?
6. What benefits does Alfresco provide the Philharmonic?
VIDEO CASE
QUESTIONS

Chapter 11 , CaSe 2 aLFreSCO: OpeN SOUrCe DOCUMeNt
MaNaGeMeNt 3
COPYRIGHT NOTICE
Case Studiess/12 Video Case study.pdf
continued
Systems
CHAPTER 12 ENHANCING DECISION MAKING
CASE 2 Business Intelligence Helps the Cincinnati Zoo Work
Smarter

SUMMARY By implementing a centralized data warehouse
with IBM Cognos Business Intelligence
software, Cincinnati Zoo and Botanical Garden has
revolutionized its business operations,
increased revenues, and improved customer service and loyalty.
L=4:59.
URL http://www.youtube.com/watch?v=IlNu15rVKSg
CASE Founded in 1873, the Cincinnati Zoo & Botanical
Garden is one of the world’s top-rated
zoological institutions, and the second oldest zoo in the United
States. It is also one of the
nation’s most popular attractions, a Top 10 Zagat-rated Zoo,
and a Top Zoo for Children
according to Parent’s Magazine. Each year, more than 1.3
million people visit its 71-acre
site, which is home to more than 500 animal and 3,000 plant
species.
Although the Zoo is a nonprofit organization and is partially
subsidized by Hamilton County,
more than two-thirds of its $26 million annual budget is paid
from fundraising efforts and
revenue from admissions fees, food, and gifts. To increase
revenue and improve perfor-
mance, the Zoo’s senior management team embarked on a
comprehensive review of its
operations. The review found that management had limited
knowledge and understanding
of what was actually happening in the Zoo on a day-to-day
basis, other than how many
people visited every day and the zoo’s total revenue.
Who is coming to the Zoo? How often do they come? What do
they do and what do they

buy? Management had no idea. Each of the Zoo’s four income
streams—admissions,
http://www.youtube.com/watch?v=IlNu15rVKSg
Chapter 12, Case 2 Business intelligenCe helps the CinCinnati
Zoo Work smarter 2
continued
membership, retail and food service—had different point-of-sale
platforms, and the food
service business, which brings in $4 million a year, still relied
on manual cash registers.
Management had to sift through paper till receipts just to
understand daily sales totals.
The Zoo’s admissions team had compiled a spreadsheet that
collected visitors’ zip codes,
hoping to use the data in geographic and demographic analysis.
If the data could be
combined with insight into visitor activity at the Zoo—what
attractions they visited, what
they ate and drank, and what they bought at the gift shops—it
could be an enormously
powerful tool for the Zoo’s marketing team. To achieve this,
however, the Zoo needed a
centralized analytics solution.
The Zoo replaced its four legacy point-of-sale systems with a
single platform—Galaxy POS
from Gateway Ticketing Systems. It then enlisted IBM and
BrightStar Partners (a consulting
firm partnering with IBM) to build a centralized data warehouse
and implement IBM Cognos

Business Intelligence to provide real-time analytics and
reporting.
Like all outdoor attractions, Cincinnati Zoo & Botanical Garden
is a highly weather-depen-
dent business. If it rains, attendance drops sharply—potentially
leaving the Zoo overstaffed
and overstocked. If the weather is unusually hot, sales of certain
items—bottled water and
ice cream, for example—are likely to rise sharply, and supplies
may run short. Having intel-
ligent insight into these possible outcomes helped the Zoo
prepare for these events.
The Zoo has integrated its IBM Cognos solution with a weather
forecast data feed from the
US National Oceanic and Atmospheric Administration (NOAA)
Web site. This enables the Zoo
to compare current forecasts with historic attendance and sales
data during similar weather
conditions—which supports better decision-making for labor
scheduling and inventory
planning.
Cognos also enabled the Zoo to identify people who spent
nothing other than the price of
admissions during their visit. The Zoo used this information to
devise a marketing campaign
in which this type of visitor would be offered a discount for
some of the Zoo’s restaurants
and gift shops. If each of these people spent $20 on their next
visit to the Zoo, the Zoo
would take in an extra $260,000, which is almost 1 percent of
its entire budget.
From experience, management knew that food sales tend to tail

off significantly after 3pm
each day, and started closing some of the Zoo’s food outlets at
that time. But more detailed
analysis from the Cognos business intelligence tools showed
that a big spike in soft-serve ice
cream sales occurs during the last hour before the Zoo closes.
As a result, the Zoo’s soft-
serve ice cream outlets are open for the entire day.
The Zoo’s new ability to make better decisions about how to
optimize operations has led
to dramatic improvements in sales. Comparing the six-month
period immediately follow-
ing the deployment of the IBM solution with the same period of
the previous year, the Zoo
achieved a 30.7 percent increase in food sales, and a 5.9 percent
increase in retail sales.
Chapter 12, Case 2 Business intelligenCe helps the CinCinnati
Zoo Work smarter 3
COPYRIGHT NOTICE

1. Why was Cincinnati Zoo losing opportunities to increase
revenue?
2. Why was replacing legacy point-of-sale systems and
implementing a data warehouse
essential to an information system solution?
3. Visit the Cognos Web site and describe the business
intelligence tools that would be the
most useful for the Cincinnati Zoo.
4. How did the Cincinnati Zoo benefit from business
intelligence? How did it enhance
operational performance and decision making?
VIDEO CASE
QUESTIONS
continued
Systems
CHAPTER 7 TELECOMMUNICATIONS, THE INTERNET,
AND WIRELESS TECHNOLOGY
CASE 1 Telepresence Moves Out of the Boardroom and Into
the

Field
(a) TelePresence: In-Person Experiences for All
URL http://www.youtube.com/watch?v=rcfNC_x0VvE; L=
3:59
(b) AXA Cuts Costs and Carbon Emissions with immersive
video
collaboration
URL http://www.youtube.com/watch?v=dD4a8Y3lEgs; L=3:52
SUMMARY Telepresence is one of the fastest growing
business-technology applications. It combines
the power of global, high-speed, broadband Internet networks
with local video, audio,
and processing power to create effective meeting and decision-
making environments
for managers at a fraction of the cost of face-to-face, in-person
meetings. As the cost of
telepresence declines, it is being deployed more deeply and
broadly into business firms,
involving a much wider range of employees and decision-
making situations.
CASE Telepresence is the effort to create a digital
environment using video and audio technologies
which mimic key features of real-world interactions with people
and objects. Telepresence
is not the same as virtual reality because the actors involved in
telepresence are human
beings, not avatars. Telepresence is more than just video
conferencing because it has a more
immersive quality. The primary use of telepresence today is to
support group meetings that
allow participants to be physically in different places but to

interact in a realistic environment
as if they were all in the same meeting room. Other uses include
the use of telepresence to
http://www.youtube.com/watch?v=rcfNC_x0VvE
Chapter 7, Case 1 telepresenCe Moves out of the BoardrooM
and Into the fIeld 2
continued
control and manipulate robots and objects in manufacturing and
field settings where the use
of humans would be dangerous. Military uses include control
over robotic “drone” aircraft, and
inspection of nuclear submarine reactors.
Telepresence, once thought to be the stuff of a distant future,
has definitively arrived. First
discussed as a technical possibility in the 1960s, and earlier in
some novels, telepresence
today is thriving thanks to broadband Internet service that has
continental and global reach,
field-of-view cameras that can capture a 360 degree visual
experience; multiple large moni-
tors to display the experience; realistic wraparound sound
systems; and increased comput-
ing power in the form of servers and client PCs. Telepresence
systems that used to cost
millions of dollars now cost thousands of dollars.
Business firms invest in telepresence systems and technologies
for a variety of reasons
including reduction of travel time and expenses, reduction in
carbon emissions caused by

unnecessary travel, improvements in worker productivity that
result from lowered meeting
and collaboration costs, and not least, improvements in
employee quality of life. With telep-
resence technologies, employees do not waste time standing in
lines at airports or spending
hours on flights or being away from their families for extended
periods.
For high-quality telepresence, firms must make large
investments in special meeting rooms,
monitors, servers, and software to develop telepresence
applications. This generally means
that only Fortune 1000 companies can afford the top-of-the-line
tools of Cisco’s telepres-
ence suite. But prices are falling, so even some school districts
can afford the infrastructure
needed for telepresence. Schools and colleges are also making
increased use of telepres-
ence. Schools such as the Fontana United school district in
California, which has 41,000
students at 40 school sites spread out over 40 miles and split
over two major freeways, are
benefiting from the introduction of telepresence technologies
via a pilot program with
Cisco.
Telepresence systems aimed at corporate customers are sold by
Cisco , AT&T, Digital Video
Enterprises (DVE), Polycom, HP, , Telanetix, Tandberg,
BrightCom, LifeSize, and Teliris. Prices
range from tens to hundreds of thousands of dollars. These
systems include multiple micro-
phones, speakers, high-definition monitors, cameras, and often
dedicated networks and
custom-made studios. They strive to be as transparent to users

as possible by providing
life-size videos, imperceptible transmission delays, and user-
friendly interfaces.
AXA: Global Financial Services
AXA provides financial services such as insurance, banking,
and savings and retirement
programs to individuals as well as businesses, both large and
small. With operations in 61
countries that serve more than 95 million customers worldwide,
AXA wanted to better
leverage the collective knowledge and experience of its 214,000
employees. In addition
Chapter 7, Case 1 telepresenCe Moves out of the BoardrooM
and Into the fIeld 3
1. List and discuss briefly the benefits claimed by Cisco for its
“In-person” experiences using
telepresence.
2. AXA is a global financial services firm. Describe why they
invested in telepresence.
3. Why does AXA need special rooms dedicated to
telepresence? Why can’t conferences
take place at the desktop?
4. In the past, work was organized into central buildings located
in central locations (like
cities) in order to facilitate face-to-face interactions. What
impacts might telepresence
have on the organization of work? How could you use these

tools to organize work on a
global scale with actually building physical facilities in remote
locations?
VIDEO CASE
Q U E S T I O N S
to promoting collaboration and sharing of best practices, the
firm wanted to reduce the
travel burden on executives, and the carbon footprint of the
firm, as well as improve the
productivity of executives who were constantly moving between
different AXA offices and
client sites. AXA possessed a basic, older video conferencing
system, but it was difficult to
use and plagued by performance problems that made
interactions stilted and awkward.
The challenge facing the firm was to identify technologies and
vendors who could deliver a
workable telepresence system that could be rolled out across its
major operations centers.
AXA began by building two beta Cisco Telepresence systems,
one in New York and the
other in Paris. Early users, mostly senior executives, were
impressed. This early success led to
the development of a global network of 43 telepresence centers
in 14 countries. A vendor
partner, Orange Business Services, contributed expertise for the
implementation. So far, AXA
has hosted 43,000 meetings, reduced the number of executive
trips by 20,000, and saved
23,000 tons of carbon emissions. In the first three years the firm
expects to save about $130
million.

COPYRIGHT NOTICE
continued
Systems
CHAPTER 9 ACHIEVING OPERATIONAL EXCELLENCE
AND CUSTOMER INTIMACY: ENTERPRISE
SYSTEMS
CASE 1 Workday: Enterprise Cloud Software-as-a-Service
(SaaS)
(a) What is Workday: Enterprise Software as a Service (Saas)
URL http://www.youtube.com/watch?v=2gkBvIIrTJY; L=3:52

(b) Workday: Mobile
Solution
s for iPad
URL http://www.youtube.com/watch?v=a_CpGQvuR9k; L: 7:06
SUMMARY Workday is a cloud-based enterprise software
company that went public in September
2012. Workday provides the functionality of enterprise software
provided on site by firms
like Oracle and SAP, long considered the duopoly of enterprise
software. Unlike these
traditional enterprise software firms that sell standalone
software and the infrastructure
required to operate it, Workday leases the software, which is
located on Workday’s cloud
servers. Companies purchase subscriptions to their services, and
then employees access
the software through web browsers on laptops, desktops, and
tablet computers.
CASE Workday provides enterprise cloud-based applications

for human capital management
(HCM), payroll, financial management, time tracking,
procurement and employee expense
management. The company is based in Pleasanton, California,
and sells cloud-based human
resources, payroll, and financial management tools and other
related products. Workday
http://www.youtube.com/watch?v=2gkBvIIrTJY;
http://www.youtube.com/watch?v=a_CpGQvuR9k
Chapter 9, Case 1 Workday: enterprise Cloud soft Ware-as-a-
serviCe (saas) 2
continued
is one of the most closely watched new companies in the area of
cloud-based computing
and SaaS (software as a service), along with early innovators
like Salesforce.com, Splunk,
ServiceNow, and Palo Alto Networks, all of which have done
very well in raising funds and
maintaining their share prices.

Founded in 2005 by executives formerly at PeopleSoft (a well-
known human relations
enterprise software company now owned by Oracle), Workday
went public in November,
and popped 72 percent in its first day of trading to $48 a share.
Workday sales grew 116
percent in the six months ending July 2012. In November 2012
it posted a quarterly net
loss of $41 million (GAAP basis) compared to a loss of $18.6
million a year ago. Revenue was
$72.6 million in the quarter, which was up 99 percent year-
over-year. While still not profit-
able, investors are piling into the stock because of the promise
of future spectacular growth,
with profits to follow.
Workday seeks to develop applications that are designed around
the way people work
today—in an environment that is global, collaborative, fast-
paced and mobile. They
update their software from their central servers three times per
year. Customers are not
charged for the updates, and the frequent updates has made it
possible for the company
to innovate rapidly. The company’s first product was a HCM

application in 2006. Since then
the firm added a financial management application in 2007,
procurement and employee
expense management applications in 2008, payroll and mobile
applications in 2009, a talent
management application in 2010, and a native iPad application
and Workday integration
platform in 2011.
Workday generates revenue by selling three-year term
subscriptions on an enterprise basis.
Subscription fees are based on the size of the customer’s
workforce. The firm’s strength
is with human resource applications, and it currently derives a
substantial majority of its
revenues from subscriptions to its Workday HCM application.
Workday markets its products
through a direct sales force.
Like other cloud-based software offerings, Workday’s have a
number of advantages
over traditional on-premises enterprise software packages
offered by SAP and Oracle’s
PeopleSoft division. On-premises software has to be purchased
and installed on the firm’s

infrastructure. Firms require extensive consulting services to be
able to install these systems,
and the implementation period is often measured in years. These
packages can be expen-
sive to customize, time-consuming to implement, and difficult
to upgrade. Companies
running cloud software don’t face the same problems, and can
also save on hardware
costs since they share computing resources with others.
Workday and other SaaS provid-
ers offer firms a much less onerous implementation, much less
expensive infrastructure
requirements, and a less costly employee training period.
Workday has attracted several U.S.
customers, including Flextronics, Lenovo, and Kimberly-Clark.
Chapter 9, Case 1 Workday: enterprise Cloud soft Ware-as-a-
serviCe (saas) 3
COPYRIGHT NOTICE

1. What kinds of functionality and capability does Workday
provide to its customers?
2. Why would a firm chose Workday over a competitor like
Oracle or SAP? What role does a
consulting firm like Towers Watson play in the implementation
of Workday?
3. What role did the iPad play in supporting the development of
Workday?
4. What is the Workfeed feature and why is it like Facebook?
VIDEO CASE

Q U E S T I O N S
Oracle and SAP are not standing still, and are currently
promoting their own cloud-based
versions of their existing enterprise products. But many in the
marketplace see these adap-
tations of older software designs as clumsy, and only a partial
step in the right direction.
Workday, as many younger firms in cloud-based computing, has
designed their products
from the ground up as Web-based and has delivered products
suitable for the new table
and smartphone platforms.
Case Studiess/9101112EOCCaseStudy.docx

Chapter 9:
1. Which business processes are the most important at Summit
Electric Supply? Why?
2. What problems did Summit have with its old systems? What
was the business impact of those problems?
3. How did Summit’s ERP system improve operational
efficiency and decision making? Give several examples.
4. Describe two ways in which Summit’s customers benefit from
the new ERP system.
5. Diagram Summit’s old and new process for handling
chargebacks.
Chapter 10:
1. Assess the management, organization, and technology issues
for using social media to engage with customers.
2. What are the advantages and disadvantages of using social
media for advertising, brand building, market research, and

customer service?
3. Give some examples of management decisions that were
facilitated by using social media to interact with customers.
4. Should all companies use Facebook and Twitter for customer
service and advertising? Why or why not? What kinds of
companies are best suited to use these platforms?
Chapter 11:
1. Analyze Firewire using the value chain and competitive
forces models.
2. What strategies is Firewire using to differentiate its product,
reach its customers, and persuade them to buy its products?
3. What is the role of CAD in Firewire’s business model?
4. How did the integration of online custom board design
software (CBD), CAD, and computer numerical control (CNC)
improve Firewire’s operations?

Chapter 12:
1. It has been said that Zynga is “an analytics company
masquerading as a games company.” Discuss the implications of
this statement.
2. What role does business intelligence play in Zynga’s business
model?
3. Give examples of three kinds of decisions supported by
business intelligence at Zynga.

4. How much of a competitive advantage does business
intelligence provide for Zynga? Explain.
5. What problems can business intelligence solve for Zynga?
What problems can’t it solve?

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