Competitive Causes And Value String Models IT Essay

In order for a firm to make it through in its region of business it must be superior compared to its competitors and therefore shoot for competitive advantage. Regarding to Bocij et al (2006 pg 57) competitive edge is whenever a company or business strives to be the marketplace leader in the area they provide their business or service. Competitive advantages may be accomplished by a organisation in many ways such as utilizing some of the next techniques; restructuring the business enterprise, processes to reduce overheads, offer extra services to existing customers as well as looking for clients and always considering the changes in the internal and external environment and react to changes that could affect the businesses profitability. By applying many of these techniques this will allow the company to increase its profitability and increase its market show.

For a corporation to be obtaining competitive advantages the organisation can be analysed in two ways. These two ways are Porters Five Pushes and THE WORTHINESS Chain Model. Both these analysis techniques take a look at different facets of the business enterprise. In this case Panasonic will be analysed using both of these techniques.

According to Laudon and Laudon (2005 pg 102) Michael Porter developed the five causes in 1979. Michael Porter says there are five makes that effect the competitive advantage of a company. The five causes that that Michael Porter has come up with talks about what affect the exterior environment (macro environment) has a influence on the internal environment (micro environment). They are the five pushes that Michael Porter developed

Traditional competitors - every business has a show in the market they specialise in. with this show of the market the organisation grows their brand and personal information and devise new means of offering extra services that other businesses in their market do not offer. This can attract new customers so and the extra cost of the will be previous on to existing customers.

New market entrants - this is when a company or a individual person is able to create and give a service or product that will have a large customer base that is able generate success for offering a goods and services.

Substitute products - they are alternative products that exist on the marketplace that folks may be willing to use as the products are cheaper compared to others.

Customers - a organisations success is determined how it maintains hold of existing customers and how it attracts new customers. The customer holds the key electricity of identifying how successful a company is really as customers can easily switch to another brand if the existing organisation will not match or overcome the price tag on the merchandise or service they may be receiving.

Suppliers - the provider has a major impact about how the end product is sold as the organisation is able to offer its product to the finish customer at a competitive price in comparison to its rivals. So if the organisation has several supplier the organisation can have significantly more control over the costs of the merchandise, replenishment and availability.

Above: shows Porters Five pushes that have an impact on the stability of any organisation and what exactly are in charge of any actions which may be taken to keep carefully the company at a competitive advantage and keep it in profitability. The five makes are Traditional rivals, Customers, Suppliers, New market entrants and Substitute products. (Necessities of Management Information Systems Managing The Digital Company, Laudon and Laudon 2005 pg 103)

Value String Model

Laudon and Laudon (1995 pg 53) the worthiness Chain Model originated by Michael Porter in 1985. The Value Chain Model features specific activities within the business enterprise where competitive strategies can be employed and where information systems will probably have a strategic impact. THE WORTHINESS Chain Model identifies correct, critical leverage factors where a organisation can use information technology most effectively to increase its competitive gain within its market talk about. The increase in the market talk about will allow the organisation to be more profitable, reduce operating costs and improve communication within the organisation internally and externally.

The Value String Models looks at a company as basic set of chain activities that add a margin of value to a companies products or services. These activities are categorised directly into two activities. These activities are known as Main and support activities.

Primary activities

Laudon and Laudon (1995 pg 54) says the primary activities of the organisation are related to the creation and circulation of the final service or product that a company provides. Main activities include inbound logistics, operations, outbound logistics, marketing and sales and service. Inbound logistics includes the receiving and storing of materials prepared to distribute to the correct department for the finish product to be mage. Functions create to the materials in to the final product. After the product has been created outbound logistics distributes the made products to the right sorting point. Once the product has been sorted and stored sales and marketing promote the organisations products and sell them when they obtain orders for the coffee lover. The service activity makes sure that the organisations products are serviced (when needed) and are retained to make certain any future problems (if any) cause the nominal amount of disruption.

Support activities

Laudon and Laudon (1995 pg 54) to ensure that the principal actives are sent to the best standard support activities are in destination to make sure the infrastructure is functioning. Support activities include administration and management, human resources, technology and procurement. Supervision and management manages how the company functions on the day to day basis and is in charge of how the company is structured. Human resources care for the welfare and advantages of the employees within the company in terms employing, training and keeping its employees. Technology allows the company to enhance the creation of goods and procurement works with by purchasing inputs.

Above: shows Porters Value String showing the primary and extra activities of a organisation and which section provides value to the company. (Essentials of Management Information Systems Managing The Digital Firm, Laudon and Laudon 2005 pg 96)

Porter's Five makes: Panasonic analysis

Traditional opponents - Since Panasonic was founded in 1918 it includes steadily become the largest Japanese consumer electronics maker. Panasonic owner Konosuke Matsushita first started the company advertising lamps for bicycles and then diverse to market other electronic products. Later in 1961 after being rebranded under different names the Panasonic brand was produced in 1961 when it began the produce tvs (TV's ) for the American market. From than it is becoming one of the very most competitive and leading companies for research and development in the electronic sector. As the competiveness in the electronic digital sector is so reliant on technology it's important for a organizations to innovate new ideas in to products. Panasonic is situated in THE UNITED STATES, Asia and Europe. As stated before Panasonic has found success on it industry. The global sales information for Plasma Television 's show that Panasonic ( 40. 7%) is the leading supplier in terms of shipping volume throughout the world closely accompanied by Samsung on (33. 7%), LG on (23. 3 %) and other brands accommodated for the (2%). (HDV TEST, 2011)

New market entrants - There is absolutely no threat of any other brand entering the marketplace and become prominent. This is because of the barrier accessibility system of someone entering the marketplace with a product or service. These two barriers are known as high barrier and low hurdle entry products / services. High barrier service / products is made for high end products for example if an individual wanted to start a new bank the interested party must go through hard regulation and become approved and regulated by a external firm for example FSA to be sure they are functioning within the rules set by the government. The other barrier is recognized as low entry barrier markets. This admittance barrier is for a low accessibility product or service. A example of this is if an individual wanted to open a corner shop little authorities regulation is necessary and there is little set up costs. Along with the barrier entry system the new entrant must have the technology understand how that will allow them to build up their products further.

Substitute products - The risk from alternative products is fairly low as people will be more inclined to use brands that they are familiar with so if they wanted to turn brands for a alternative cheap brand the expenses are low however they can be high if they wanted to change to a much substitute brand such as Sony which is normally seen more expensive. Technology can even be a factor for example now people can watch TV on cell phones and laptop computers. Another example is when Sony In 2005 Panasonic has reacted well to change and development in technology this is seen when Sony, Panasonic and Philips launched Bluray technology from the HD DVDs that were launched by Toshiba, Microsoft and Hitachi. Much of the success of the format was reliant on which vendors favoured and promoted products their products.

Customers - Panasonic is a international brand and it is recognisable all over the world. It has posted respectable results. This year 2010 Panasonic put up the following sales Japan 54% Asia 23%, North America 12 % and Europe 11%. (These characters accommodate for Panasonic products only). As technology evolves Panasonic has retained up with the rate for example 3D videos made by Hollywood such as Avatar has enabled Panasonic to develop their 3D TELEVISION that enabled them to obtain (50. 5%) of the market share from 230, 000 models sold all over the world. Samsung came up second with a 3D market talk about of 41. 7%, followed by LG with less than 10% at the end of 2010. (HDV TEST, 2011)Panasonic has guaranteed that the end customer can understand the end product having a solid relationship using its retailing outlets that sell its products. This is very important because dedicated customers that use and purchase the Panasonic brand and do not turn to a substitute brand. Consumer demand for electric products is cracked directly into two segments. People who will have a more disposable income is going for products with good quality such as high definition and wide display screen plasma technology and folks who do not have a less disposable tend to stay with less costly products that are much easier to use.

Suppliers - Panasonic has a personal relationship using its suppliers. This is due to the way the business structure is set up and operates. The Panasonic brand is under the brand of the mother or father company called Matsushita Electric Industrial Co. Ltd under this group there are another 15 subsidiary companies for example SANYO and Technics that specialise in their own division. With each company specialising in their own team Panasonic recognizes what they can provide to the new product that has been developed.

Value Chain model: Panasonic analysis

Primary activities / support activities

As the Panasonic brand comes under the parent company of Matsushita Electric Industrial Co. Ltd, when it became a worldwide company it acquired a decentralized strategy as none of the offices outside of Japan possessed a centralized data source that they could retrieve information from. Totally Matsushita Electric Industrial Co. Ltd possessed setup 13 major labs in overseas countries -in the US, three in Asia and three in European countries. Many of these labs were founded to modify and customize products for the local markets. In addition they took good thing about locally available technological information and skilled staff so only catered for the country they operated in instead as an organization as a whole. Components which were to be manufactured and found in Panasonic products are internally outsourced to the other brands it possesses so the relationship between all of its suppliers is strong. This romantic relationship is also important as Panasonic as a firm can relay on that the components had a need to make its products are of the highest standard and there are nominal chance of flaws within its products and it a defect occurs they must locate the challenge quickly and solve the condition causing little negativity about the products. The vendors who sell Panasonic are well educated and educated by Panasonic to be sure that their product stands out when the finish customer is purchasing the end product.

Provide a crucial examination of how Panasonic's information management problems have an impact on its business performance and ability to perform its strategy.

Panasonic's information problems damaged its business performance and capability to perform its strategy. Panasonic was enjoying the amount of successes factors however this success didn't take in to the bank account on what Panasonic was shelling out for its supervision costs.

A information system could have allowed Panasonic to access and centralize its information so it could be easily retrieved when needed. A information System (IS) is identified by Avison and Fitzgerald (2003 pg 20)is when a organisation collects and stores key business procedures on a single database and saved on the computer network and information can be accessed and data can be manipulated to create a series of reviews and inquiries. This usually helps a organisation when it spreads its business dealings around the globe and therefore trades over a international platform that allows the company to broaden in new marketplaces which in turn will boost the profitability of the business. That is known by the word of 'Globalisation'. (Avison and Fitzgerald 2003 pg 8). This is seen when Panasonic widened its procedures throughout European countries, Asia and THE UNITED STATES. This included 15 subsidiaries, 14 making facilities, and five research and development centres, and seven administrative office buildings. A Management Information System (MIS) was also needed as this might have mixed different industries of the business enterprise and will help it to make different decisions at different levels. An average system has four processes that work on three levels and have certain characteristics an is used by the correct level of management. They only see the data which may affect their section of the organisation they are considering. A Professional Support Systems (ESS) produces reviews and reactions to queries a choice Support Systems (DSS) helps the company to make decisions on important decisions that the organisation may face both of these systems are being used by senior management, a Management Information Systems (MIS) allows the organisation to access previous files and view current performance of the company this will allow the organisation to find any styles or patterns to make any decisions these decisions are made by middle management and a Purchase Handling Systems (TPS) files transactions and incidents these records have emerged by operational management. ( Laudon and Laudon 2004, pg 53)

As Panasonic was also experiencing problems taking care of its data effectively as product and customer data was inconsistent, duplicate, or incomplete. Different segments of Panasonic used their own data management functions which were isolated or not the same as other locations within the company. Panasonic also got problems when it launched a new product as each product included photographs, product features and descriptions, guides, costing data and point of deal marketing information. When these details was sent out to the many locations each location adapted these details for the spot and country they resided in. this resulted in problems when Panasonic launched a product globally as information about the merchandise had to be condensed to a set of data for introducing the product globally. This problem postponed the launch of new products so opponents seized after this opportunity to seize infiltrate in to markets didn't reach in its first stage of the launch.

Analyse the management, organisation, and technology factors which were responsible for the problems identified in the last question.

A IS system is just more than inputting and outputting business functions to consolidate information together. From a business point of view a IS system also talks about other environmental factors within the company. From a company perspective a IS system is a organisational and management solution based on information technology to a challenge based on the surroundings it is within. to understand how a organisation operates and what obstructions it could face a director must understand the surroundings it is a organisation is a lot more than computers it also has to understand the broader organisation, management and information technology.

Above: a diagram showing that information systems tend to be than just personal computers. Using Information Systems effectively requires and knowledge of the company, management and technology. (Requirements of Management Information Systems, Laudon and Laudon 1995 pg 9)


IS systems are a significant part of your organisation composition and without this they might not exactly able to are present whatsoever for example a credit scoring firm without this technique they'll not be able to operate at all.

The major components of a organisation are its people, framework and operating methods, politics and culture. Formal and large organisations are different as they are divided in to hierarchal composition. This structure is a pyramidal structure with management coming to the top midsection management in the centre and operational personnel at the bottom. There will vary types of employees within a organisation and just work at different levels. Knowledge workers are people such as engineers and architects who innovate ideas for the organisation. These people act on the most notable of the organisation, data staff such as secretaries and bookkeepers who use the center management and in the bottom level will be the creation or service employees who focus on providing the service or creating the final product. (Laudon and Laudon 1995, pg 9)


Managers are responsible for innovating new ideas so that the organisation is actually developing services or delivering new service. The three type of managers are senior management who are accountable for making permanent decisions, middle management who are in charge of helping the senior management to make these decisions and functional management to adopt of daily working of the company and handle any short-term problems. (Laudon and Laudon 1995, pg 9)


IS systems are one of the tools that a organisation uses to deal with change and moreover it contains the organisation collectively. That is done through a number of different technologies such as computer hardware that allows the organisation to suggestions, out put and process information throughout the organisation. A exemplory case of computer hardware is screens, keyboards and printers. Computer software is a sequenced encoding instruction that allows the hardware to operate. Storage space technology allows the data to be stored and can be moved between pcs a example of storage space technology is disks, tapes and pen drives. Telecommunication technology allows every one of the physical hardware to hook up together. This also contains out put components such as printers. This allows programs and information to be seen everywhere within the company. (Laudon and Laudon 1995, pg 9)

As Panasonic was not handling its data within the organisation properly. That is shown when the different divisions of Panasonic (Europe, North America and Asia) did not share a single system as they must have due to size of the business and different countries and time zones they were set for example that they had inconsistent data on its products and customers. This problem in turn affected the culture of the company as each office in each time zone were not working to the same goal and aim lay out by Panasonic instead these were totally centered on their own region on a product start instead. this led to a decrease in operational efficiency and higher costs from the company. This shows that Panasonic did not have any control over the info it possessed and therefore was useless possessing this data as it was not in any logical order to use.

The management of Panasonic acquired improved the CEO in 2006 to a person called Fumio Otstubo. In 2006 Panasonic was operating margin was only 5% and the goal for 2010 2010 was 10%, on the market where consumers expect the price of new technology to decrease over time. It was impossible to anticipate to increase profit percentage by increasing prices, instead there is a need to lessen costs and increasing sales. To do this target he chosen the strategy was lowering the cost and increasing sales.

To solve the problem Panasonic decided to acquire their data follow a "single eyesight of truth". These details gathered emerged through a variety of platforms for example fax machines, mail, e-mails and calls. How ever before using this technique also experienced a risk of inaccuracies and inefficacies.

Evaluate the way the master data management address these problems and discuss the potency of this solution.

Panasonic decided to change the strategy of how it obtained its data from within the business. The strategy that Panasonic was using was the "pull "model and replace it with a "push "strategy. These models differ in how data is obtained and influences how a organisation is run.

The drive model is also called the build to stock model. Within the push model production within the company is based on forecast sales it has made. The forecast are guesses and requirements for the real service or product that the company will provide. (Bocij p et al 2006, pg 170)

Above: a diagram exhibiting the force model. Remember that the suppliers creation is situated forecasts throughout the chain except from producer pulls from the supplier. . This goes from the provider, producer, distributor and retailer. (Management Information Systems Managing The Digital Organization, Laudon and Laudon 2006 pg 366)


The take model is also called the demand driven model or designed to order model. A genuine product or service is only made once a bought. The primary difference between both of the models is a company only makes what they sell, not what they make. (Bocij p et al 2006, pg 170)

Above: a diagram demonstrating the yank model. Note that each process is pulled from the client through each process to the supplier. A product is only made whenever a customer orders the product to lessen costs in wastage. (Management Information Systems Managing The Digital Firm, Laudon and Laudon 2006 pg 367)

When Panasonic integrated a "push" model to displace a "pull" model to interpret and sort data as recently when employees in marketing appeared for specific information that they had to try a number of locations. Utilizing the thrust model allowed Panasonic to make a centralized data bank then this sends the wanted information to employees in marketing and sales immediately and constantly. Retail partners such as Wal-Mart who are recipients of the info can view the data at all stages of a product rollout. Therefore, specific employees can have better presence of the products and services. The outcome of this thrust model is that customers are less inclined to become confused while researching Panasonic products.

Panasonic's Europe's data management was upgraded with master-data-management (MDM) software which was provided from IBM's Web Sphere line. The software empowered Panasonic Europe to gain better control of their data and better streamline the business process. The MDM execution included the business process analysis, data examination, data cleaning, and a master data service part. The MDM allows employees with usage of view the business's data and activities throughout the organization. The aim of the MDM was integrate every one of the various departments and combine them so any information can be utilized from the professional file. Inside a year. 5, Panasonic Europe was getting products to advertise faster and spending 50 percent less time creating and maintaining product information. Time-to-market for a product was reduced from five to six months to 1 to 8 weeks.

Critically analyse the troubles Panasonic faced when implementing this solution.

During the unit installation stage Panasonic faced some problems when they implemented the new system. When Implementing MDM system it is a multi-step process which includes business process analysis, data analysis, data detoxification, data loan consolidation and reconciliation, data migration, and development of a master data service layer. The MDM bought collectively every one of the business steps this required information from every one of the departments to get together. There was the problem of degrees of authenticity of accessing data at different levels. Another problem that Panasonic encountered was at its North America that it had to confront lots of countries that spoke different languages and each country had its own money. Each country could have its own culture and therefore would have contributed more problems for Panasonic. The culture within a company or country is thought as being shared prices, in written guidelines an assumptions within the company and how the organisation works. This problem was also experienced by its Western arm experienced to do when putting into action its system. (Laudon and Laudon 2004, pg 390)

Panasonic also faced another problem this is reorganising and consolidating data information because of its products for Wal-Mart. Then Panasonic stated to look closer on what information was needed for Wal-Mart and looked at what was adhered by the industry benchmarks. Panasonic decided to try looking in its legacy systems for this data. Panasonic then considered IBM to help them to create an program apparatus to collect the required data for a repository.

Bob Schwartz made a solid case to the corporate office in Japan that integrating a data management strategy internationally would be a major advantage to the company's infrastructure. This is going to be hard as traditionalists would have resisted change. This is credited the culture of dread that is within a company when applying change as employees dread that the way they are working is fine and there is no need for change as new change within the company is a threat to their careers. Bob Schwartz also realised that Panasonic needed to combine their new system with MDM technology. Bob Schwartz increased revenue by integrating distributed data inventory among the list of suppliers such as Best Buy and Circuit City. As a result of them utilizing MDM, Panasonic possessed become more competitive and may produce services for the global market.

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