Birla Institute of Technology & Science, Pilani

Work-Integrated Learning Programmes Division

First Semester 2009-2010
Comprehensive Examination
(EC-2 Regular)
Course No.
Course Title
Nature of Exam
Weightage
Duration
Date of Exam
Note:
1.
2.
3.
4.

: BITS ZC471
: MANAGEMENT INFORMATION SYSTEMS
: Open Book
: 60%
No. of Pages
=4
: 3 Hours
No. of Questions = 5
: 25/10/2009 (AN)

Please follow all the Instructions to Candidates given on the cover page of the answer book.
All parts of a question should be answered consecutively. Each answer should start from a fresh page.
Mobile phones and computers of any kind should not be used inside the examination hall.
Use of any unfair means will result in severe disciplinary action.

Q.1. Read the Case carefully and answer the questions given below.
Quantum Corporation Streamlined Its Supply Chain
Quantum Corporation is a major U.S. manufacturer of hard disk drives and other hightechnology storage components. Quantum faced two challenges in its manufacturing
process
The first challenge was streamlining its component supply process in order to reduce onhand inventory. Quantums traditional ordering process was labor-intensive, involving
numerous phone calls and manual inventory checks. To ensure that production would not
be interrupted, the process required high levels of inventory. Quantum needed a system
that would automate the ordering process to increase accuracy and efficiency, reduce
needed inventory to three days supply, and provide the companys purchasing agents
with more time for non-transactional tasks.
Quantum second challenge was to improve the quality of components data in its material
requirement planning system. Incomplete and inaccurate data caused delays in
production. Quantums solution of manually reviewing reports to identify errors was
labor intensive and occurred too late; problems in production were experienced before the
reports were even reviewed. Quantum needed a technology solution that would enable it
to operate proactively to catch problems before they caused production delays.
The solution that quantum chose to automate its components supply process was an
interenterprise system that automatically e-mails reorders to suppliers. Initiated in 1999,
the system uses innovative event detection and notification solution from categoric
software.It scans Quantums databases twice daily, assessing material requirements from
one application module against inventory levels tracked in another. Orders are
automatically initiated and send to suppliers as needed, allowing suppliers to make
regular deliveries that match Quantums production schedule. The system not only
notifies suppliers of quantity of components required in the immediate orders , but also
give the supplier a valuable window into the amount of inventory on hand and future
weekly requirements.

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The system also provided other improvements. It enabled Quantum to tap into multiple
data sources to identify critical business events. To elevate data quantity, Quantum
implemented Categoric Alerts to proactively catch any data errors or omissions in its
MRP database. The systems notifications are now sent whenever any critical data fall
outside the existing operational parameters.
The system has produced the desired results. For, example, the estimated value of the
improved ordering process using the new system is millions of dollars in inventory
reductions each year. The buyers have reduced transaction costs, and both Quantum and
its buyers get a lot more information with a lot less work. Before the implementation of
Categoric Alerts, Quantums analyst would search massive reports for MRP data errors.
Now that the new system is implemented, exceptions are identified as they occur. This
new process has freed the analyst from the drudgery of scanning reports and has greatly
increased employee satisfaction.
Data integrity of MRP increased from 10 percent to almost 100percent, and Quantum is
now able to quickly respond to changing customer demand. The system paid for itself in
the first year.
1.1
1.2
1.3

Identify the internal and external parts of the supply Chain that were enhanced with
the system.
Explain how purchasing was improved.
Describe how Quantums customers are being better served now.
[3 x 4 = 12]

Q.2. Read the Paragraph and answer the questions given below.
Marketing Dining Certificates Online
Restaurants.com was founded in 1999 as an all purposing e-dining portal with menus,
online video tours, and a reservation feature. Like other dot-coms, the company was
losing money. Not too many restaurants were willing to pay fees in order to put their
webpage on the Restaurants.com site. The company was ready to pull the plug when its
owner learned that CitySpree, which was selling dining certificates (coupons) online, was
for sale in a bankruptcy auction. Realizing the Restaurants.com might have a better
model for selling dining certificates online than did CitySpree, the owner purchased
CitySpree. This enabled him to change the company from just another dining portal to a
gift certificate seller.
Here is how the new business model works: Restaurants are invited to place, for free,
dining certificates at Restaurants.com, together with information about restaurant, menu,
parking availability and more. The dining certificates traditionally had been found in
newspapers and newspaper inserts. Placing them online is free to restaurant owners, some
use the online coupons to replace the paper coupons and others supplement the paper
coupons with the online version. Restaurants.com sells these coupons online and collects
all the fees for itself. The restaurants get broad visibility since Restaurants.com advertises
on Orbitz, Yahoo, and MSN, it even auctions certificates to eBay.

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The certificates offer 30-50 percent off the menu price, so they are appealing to buyers.
By using a search engine, you can find a restaurant with a cuisine of your choice, and you
can look for certificates when you need them. Although you pay $5-$15 to purchase a
certificate, you get usually a better discount than is offered in the newspapers. You pay
with your credit card, print the certificate; you get usually a better discount than is offered
in the newspapers. You can pay your credit card, print the certificate, and are ready to
dine. Customers are encouraged to register as members, free of charge. Then they can get
e-mails with promotions, news and so on. In their personalized accounts customers can
view their past purchases as well. Customers also purchase gift certificates to be given to
others. And bargains can be found: for e.g. a $50-off-regular price certificate to New
York Citys Manhttan Grille was auctioned for only $16.
The business model worked. By going to eBay, the worlds largest virtual mall,
Restaurants.com found an audience of millions of online shoppers. By e-mailing coupons
to customers it saves the single largest cost of most conventional coupon marketersprinting and postage. Finally, the model works best in difficult economic times, when
price conscious customers are looking for great deals.
The financial results are striking: Revenues doubled during the first five months of
operation (2001). The company has been profitable since third quarter of 2003, by 2003
is selling over 80,000 certificates a month, grossing over $5million in 2002, and
expecting about $10 million in 2003.
2.1
2.2
2.3
2.4

Relate the term lessons from failures with this case.

Why was it necessary to purchase CitySpree?
What motivates restaurants to participate in the new business model when they
refused to do so in the old one?
Given that anyone can start a competing business, how can Restaurants.com protect
its position? What are some of its competitive advantages?
[4 x 3 = 12]

Q.3. Discuss how a community of practice is developed / can be developed in your

organization. How do these COPs influence the successful implementation of
KMSs in your organization?
[12]
Q.4. Read the Paragraph and answer the questions given below.
Argot International (a fictitious name) is a medium-sized company in Peoria, Illinois,
with about 2,000 employees. The company manufactures special machines for farms and
food-processing plants, buying materials and components from about 150 vendors in six
different countries. It also buys special machines and tools from Japan. Products are sold
either to wholesalers (about seventy) or directly to clients (from a mailing list of about
2,000). The business is very competitive.
The company has the following information systems in place: financial/accounting,
marketing (primarily information about sales), engineering, research and development,
and inventory management. These systems are independent of each other, although they
are all connected to the corporate intranet.

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Argot is having profitability problems. Cash is in high demand and short supply, due to
strong business competition from Germany and Japan. The company wants to investigate
the possibility of using information technology to improve the situation. However, the
vice president of finance objects to the idea, claiming that most of the tangible benefits of
information technology are already being realized.
You are hired as a consultant to the president. Respond to the following:
4.1
4.2
4.3

Prepare a list of ten potential applications of information technologies that you

think could help the company.
From the description of the case, would you recommend any portals? Be very
specific. Remember, the company is in financial trouble.
How can Web services help Argot?
[3 x 4 = 12]

Q.5. Read the Paragraph and answer the question given below.
7 Eleven stores improved its competitive position by wringing more value out of its
customer database. This companys early growth and strategy has been based on face-toface relationships with its customers and intimate knowledge of exactly what they wanted
to purchase. As the company grew over time, it was no longer able to discern customer
preferences through personal face-to-face relationships. A new IS helped obtain intimate
knowledge of its customers once again by gathering and analyzing customer purchase
transactions.
Porters model identifies the forces that influence competitive advantage in the market
place. Of greater interest is the development of a strategy aimed at establishing a
profitable and sustainable position against these five forces.
5.1

In the above paragraph identify and describe the strategy for competitive advantage
given by Porter.Discuss the role of information system in using the above strategy.
[12]

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