Answer Happy

Assume that you are employed for the roles listed below in the
IT (information Technology) department of a company such as
Lenddo
For each of the roles, provide one example of an action !
Lenddo( google it and you can know this is a loan company and its
company introduction)
(i) Social Media Manager (ii) Business Analyst
A. (1 mark, for the example) Provide a detailed example of a
loan transaction that could take place at Lenddo as part of a
transaction processing system. Explain why it is a transaction.
B. (1 mark, for the example) What type of knowledge worker would
be employed by Lenddo? Provide an example of how the knowledge
worker could use information technology to do his/her job.
C. (1 mark, for the example) Provide an example relevant to the
case of how information technology could contribute to improving a
person’s quality of life.
D. (5 marks, 1 mark for each example) Explain the impact of each
of Porter’s competitive forces below in the context of financial
services companies such as Lenddo. Discuss both the impact of the
web and the effect of Porter’s five competitive forces for each of
your answers. Use Figure 2.3, Porter’s competitive forces
model.
1. The threat of entry of new competitors
2. The bargaining power of suppliers
3. The bargaining power of customers
4. The threat of substitute products or services
5. The rivalry among existing firms in the industry
1. The threat of entry of new competitors: The threat that new competitors will enter your market is high when entry is easy and low when there are significant barriers to entry. An entry barrier is a product or service feature that customers have learned to expect from organizations in a certain industry. An organization that seeks to enter the industry must offer this feature to survive in the marketplace. There are many types of entry barriers. Consider, for example, legal requirements such as admission to the bar to practise law or a licence to serve liquor, where only a certain number of licences are available. Suppose you want to open a gasoline station. To compete in that industry, you would have to offer pay-at-the-pump service to your customers. Pay-at-the-pump is an IT-based barrier to entering this market because you must offer it for free. The first gas station that offered this service gained first-mover advantage and established barriers to entry. This advantage did not last, however, because competitors quickly offered the same service and thus overcame the entry barrier. For most firms, the Web increases the threat that new competitors will enter the market because it sharply reduces traditional barriers to entry, such as the need for a sales force or a physical storefront. Today, competitors frequently need only to set up a website. This threat of increased competition is particularly acute in industries that perform an intermediation role, which is a link between buyers and sellers (e.g., stock brokers and travel agents), as well as in industries in which the primary product or service is digital (e.g., the music industry). The geographical reach of the Web also enables distant competitors to compete more directly with an existing firm. In some cases, however, the Web increases barriers to entry. This scenario occurs primarily when customers have come to expect a nontrivial capability from their suppliers. For example, the first company to offer Web-based package tracking gained a competitive advantage from that service. Competitors were forced to follow suit. 2. The bargaining power of suppliers: Supplier power is high when buyers have few choices from whom to buy and low when buyers have many choices. Therefore, organizations would rather have more potential suppliers so that they will be in a stronger position to negotiate price, quality, and delivery terms. The Internet's impact on suppliers is mixed. On the one hand, it enables buyers to find alternative suppliers and to compare prices more easily, thereby reducing the supplier's bargaining power. On the other hand, as companies use the Internet to integrate their supply chains, participating suppliers prosper by locking in customers. 3. The bargaining power of customers (buyers): Buyer power is high when buyers have many choices from whom to buy and low when buyers have few choices. For example, in the past, there were few locations where students could purchase textbooks (typically, one or two campus bookstores). In this situation, students had low buyer power. Today, the Web provides students with access to a multitude of potential suppliers as well as detailed information about textbooks. As a result, student buyer power has increased dramatically. In contrast, loyalty programs reduce buyer power. As their name suggests, loyalty programs reward customers based on the amount of business they conduct with a particular organization (e.g., airlines, hotels, car rental companies). Information technology enables companies to track the activities and accounts of millions of customers, thereby reducing buyer power. That is, customers who receive perks from loyalty programs are less likely to do business with competitors. (Loyalty programs are associated with customer relation- ship management, which you will study in Chapter 11.) 4. The threat of substitute products or services: If there are many alternatives to an organization's products or services, then the threat of substitutes is high. Conversely, if there are few alternatives, then the threat is low. Today, new technologies create substitute products very rapidly. For example, customers can purchase wireless telephones instead of landline telephones, Internet music services instead of traditional CDs, and ethanol instead of gasoline for their cars. Information-based industries experience the greatest threat from substitutes. Any industry in which digitized information can replace material goods (e.g., music, books, software) must view the Internet as a threat because the Internet can convey this information effi- ciently and at low cost and high quality. Even when there are many substitutes for their products, however, companies can create a competitive advantage by increasing switching costs. Switching costs are the costs, in money and time imposed by a decision to buy elsewhere. For example, contracts with