BCIS 401 Information Systems for Management
Electronic Commerce
BCIS 401Information Systems for Management
Value Chain Models
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Physical Value Chain Model
• A series of value adding activities connecting a company’s supply side to its demand side
• Analysis of the PVC has allowed managers to redesign internal & external Processes to improve efficiency and effectiveness
• VCM treats information as a supporting element of the value adding process, not as a source of value itself
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Virtual Value Chain Model
• VVC exists in the market space• Value-adding process unique to the information
world are required to turn raw information into new market space services and products
• Creating value in any stage of a VVC involves a sequence of five activities– Gathering, organizing, selecting, synthesizing and
distributing information
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Mixing the Physical & Virtual
• Companies that do business in both the market place and the market space exploit both the PVC and VVC
• To be successful these chains must be managed distinctly but in concert
• Companies that adopt value-adding information processes generally do so in three stages
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Stages of Adoption of Value-Adding Information Process
• Visibility
• Mirroring Capability
• Value matrix
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Visibility
• Companies acquire an ability to “see”
physical operations more effectively
through information
• Large scale IS used by managers to coordinate activities in their PVC
• Foundation laid for a VVC
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Mirroring Capability
• Companies substitute virtual activities for
physical ones
• Companies begin to create a parallel value chain in the market space
• Establishing space-based relationships allows companies to extract value from the space
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Value Matrix
• Manager’s draw on information in their VVC to deliver value to customers in new ways
• This is accomplished by applying the generic value adding activities to their VVC and thereby exploit the value matrix
Physical Value Chain
Virtual Value Chain
Gather
Organize
Select
Synthesize
Distribute
New markets
Value
Matrix
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Marshall Industries
Junction Box Model
Level 1 Junction Box
Clean conduit for transactions
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Level 1
• Streamlining for cost, efficiency, and basic reliability
• Quality Order Booking, Resell App. (QOBRA)
• Automated Shipping and Receiving System (AS/RS)
• Aimed at supporting basic operational capabilities.
Level 2 Junction Box
Internal Integration
Intelligently connecting the Insides to better connect the Outside.
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Level 2
• Marshall Net - The Intranet– Automates Routine Processing– Frees up employees to provide value to
customers– Supports approximately 400 field sales
employees
Level 3 Junction Box
Empowering the Outsides to more intelligently
connect to the Insides through multiple modes
of service.
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Level 3
• Redesigning Business Processes to provide 24x7 customer service
• Marshall on the Internet– Dynamic Web site– Order tracking via UPS, on Marshall’s site
• EDI
• Connect to Marshall’s engineers on-line
Level 4 Junction Box
Customizing the connections to the
Outside for added value.
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Level 4
• Establish Extranet– PartnerNet - Draws visits from ~1,300
customers & suppliers daily– Integrated with QOBRA, DRP, sales force
applications– Enables integration of complete purchasing
cycle
• Market Intelligence System– MAP - Marshall Account Profile Planner
Level 5 Junction Box
Leveraging knowledge in the Insides and Outsides
for value innovation
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Level 5
• DRP• MAP
• Electronic Design Centers– Provides design information & simulation
ability to customers
Level 6 Junction Box
Prototyping future opportunities for value
innovation
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Level 6
• Be Proactive in planning its future in the face of the accelerating rate of new ITs
• Build IT platforms that serve to prototype the future. Marshall’s Strategic R&D– Net Seminar - Brings together Suppliers &
Customers to design new products– Education news and entertainment network
