Homework Week 1
1. Discuss the term "complementary assets" relative to information systems use.
The development of technology and its influence to the business growing nowadays has created a strong motivation in innovation and changing organization, putting information system the most important investment. If a business doesn’t update the new technology and invest in information system, they may not take fully advantages of existing capabilities to make higher productivity and higher profit, and then the business will soon fall behind its competitors. Therefore, the investment in developing information system is extremely necessary. But it’s not enough if the business only focus on information technology itself. For example, the whole business is equipped with the most updated technology but employees don’t get enough necessary training. As a result, the employees’ productivity will be down. Thus, the development of complementary assets is also important. Developing the complementary assets associated with the information systems such as developing new business models, new business processes, changing management behavior and organization culture, emphasizing employee training in technology, and creating new partnerships with suppliers, customers, and even competitors. Those developments are requirements, and cannot be ignored. “The value of investments in information technology depends to a large extent on complementary investments in management and organization” (Laudon, p.27)
2. Laudon Page 23: How does UPS use information technology, both to deliver packages and to maintain its place in the market?
Do a search on FedEx. Does FedEx use similar technologies?
UPS invests heavily and makes the most use of advanced information technology to deliver packages in the fastest, most efficient way and to maintain its place in the market as the world’s largest ground and air package-delivery company. How does UPS utilize information system technology in every single corner of its business?
The main product of UPS is package delivery, and how to deliver a package in the shortest of time with the most efficient delivery route and using the least transportation fuel is the key point to make success. That’s why UPS invests a lot in its package tracking system including barcode scanning systems which contain detailed information about the sender, the destination, and the time customer would want to pick up; the special software creating the most efficient delivery route for each driver; the Delivery Information Acquisition Device (DIAD) to keep track of the minute-by-minute delivery route of each package and provide immediate package status reports for UPS customers and customer service representatives; and many different software for customers to easily calculating fees, determine time in transit, print labels and access their packages delivery information using their own computers or smart phones. UPS drivers are also trained to optimize the performance of every task in both package pickup and delivery procedures and to efficiently use the DIAD. UPS management promotes the company’s strategy of “best service and lowest rate” by using information system technology to decrease delivery costs and to increase the customers’ ease of sending a package and checking its delivery status, in order to increase sales revenues and maintain a high level of customer service. UPS’s advance information systems also help the company to well-serve corporate customers by providing tools for customers to embed UPS functions, such as tracking and cost calculations, into their own websites to track shipments without using UPS website; or help UPS in doing partnerships with other companies to manage logistics and supply chain activities. That is how UPS using information system technology to deliver 15.6 million packages and documents each day in the United States and more than 220 other countries and territories, to maintain the leadership in
