Archive | October 16, 2015

Digital Transformation Project: Albert Heijn Personalized Shopping

Albert Heijn is a super market chain in the Netherlands and has the biggest market share. Albert Heijn claims that it is the pioneer in the development of the modern supermarket with innovations such as self-service payment possibilities as part of its multichannel approach. We focused our project on Albert Heijn’s customer loyalty program and its bonus card. With the ongoing development of digitalization more and more firms consider and deploy big data, so does Albert Heijn with the bonus card, as an extension to loyalty programs. What are these loyalty programs? These programs encourage customers to return to the supermarket by means of a loyalty card, the bonus card in Albert Heijn’s case. This is a major strength for Albert Heijn, as they are the only one in the industry using such a card. Research has shown that a customer loyalty program leads to an increase in annual purchasing for a substantial proportion of customers and effectively increases repeat purchases rates (Lewis, 2004).

A bonus card has the advantage to offer personalized marketing to the customers of Albert Heijn. However, if a misclassification (personalized marketing to the wrong individual) occurs, personalization could back-fire and this would have a counterproductive effect. Unfortunately this happened with the old bonus card. Albert Heijn uses the bonus card since 1998, however, they had to renew the bonus card because of the dirty and corrupt old database. They had to throw away the old database with purchase information of more than 15 years. How did this happen? The main cause is that customers were tended to swap cards (NRC Q, 2015). Which information strategy regarding to a disruptive or IT enabled service could Albert Heijn best implement in order to clean the big data set and leverage personal information collected via the Albert Heijn Bonus Card?

A solution for Albert Heijn is a mobile phone bonus card, as customers will much less swap these mobile bonus cards with each other. This will result in more personalized data, which is way more valuable for Albert Heijn, but also for the customers. They will receive now more personalized marketing, which increases customer satisfaction according to R. Goldsmith and J. Freiden (2004). The idea of our project contains a digital transformation of the current physical bonus card into an in-app digitalized bonus card.

Team 29:

  • Floris Hol 419214
  • Tim Prein 346786
  • Wouter Bakker 357176
  • Jesse van Hofwegen 375283
  • Jeroen Gelderblom 371908

References:

Ronald E. Goldsmith Jon B. Freiden, (2004),”Have it your way: consumer attitudes toward personalized marketing”, Marketing Intelligence & Planning, Vol. 22 Iss 2 pp. 228 – 239

Lewis, M. (2004). The Influence of Loyalty Programs and Short-Term Promotions on Customer Retention. Journal of Marketing Research, 41(3), pp.281-292.

Nrc.nl, (2015). Waarom Albert Heijn met de Bonuskaart vijftien jaar achterloopt. [online] NRC Q. Available at: http://www.nrcq.nl/2015/01/03/waarom-albert-heijn-met-de-bonuskaart-vijftien-jaar-achterloopt [Accessed 8 Oct. 2015].

Digital transformation, Van Lanschot and robo-advisory

a

Have you ever been in contact with private bankers? Probably not, because you need a minimum investment of at least 500.000 euro’s to acquire the services of a private banker in the Netherlands. What if there is a cheaper alternative, which invests your money for you, real-time and with a optimal result according to portfolio theory? This technology already exists and it is called robo-advisory, a fully automated investment tool. In our digital transformation, we discovered the possibilities of robo-advisory and applied the concept to the oldest private banker in the Netherlands, Van Lanschot N.V.

As mentioned before, Van Lanschot is the oldest and one of the largest private banks in the Netherlands. Currently, Van Lanschot is comprised of two different organizations with the same executive board and board of directors. The first company, Kempen & Co, focuses on Asset Management and Merchant Banking. Van Lanschot, the company of focus within our assignment, provides the services of private banking. Private banking is the core activity provided by Van Lanschot and has generated the most revenue of all the core activities of Van Lanschot NV with 263,3 million euro’s in 2014. Within private banking, Van Lanschot recently launched a new platform to better suit the needs of the younger customers. This online platform is called Evi. Evi is the online wealth management platform of Van Lanschot. With Van Lanschot’s traditional wealth management, a personal private banker is appointed to the client. In the case of Evi the private banker is replaced by the online platform. We further examined the Evi and its IT-applications and reviewed the business model of Van Lanschot. In the next part, we focused on our technology, robo-advisory.

In the last decade, an innovative IT-enabled service has been slowly adapted in the wealth management industry. It integrates and automates both investment advice and investment management by making clever use of client and investment information and algorithms. The technology is named robo-advisory and emerging start-ups, often called robo-advisors, are challenging the traditional wealth management business model. Robo-advisors provide a fully digitalised wealth management experience. When customers sign up for a robo-advisor, they fill in a short questionnaire to determine their risk preference, goals and income. The robo-advisor then automatically generates an investment portfolio proposal. Robo-advisory has several features that make it a very interesting alternative to traditional wealth management for the customer. Robo-advisory decreases the cost of wealth management, increases transparency and gives a more personalized experience. Furthermore, we investigated several market implications for robo-advisory.

At last, we critically reviewed the compatibility of robo-advisory and Van Lanschot, based on strategically alignment and feasibility. We also give an implementation option for Van Lanschot, such as outsourcing or insourcing. In the end, we recommend the management of Van Lanschot N.V to implement the proposed robo-advisory technique into the business model of Van Lanschot.and and implement robo-advisory within the Evi Van Lanschot brand as an extension. Evi is currently well positioned within the Dutch market and the digital nature of robo-advisory combines well with Evi’s brand values. As an implementation strategy, we conclude that robo-advisory development should be outsourced; yet strategic control over the intellectual property should be maintained.

357519rs

377578nb

358041rc

356104sf

164873kb

Summary of Digital Transformation Project – Team 32

Save time with these new features from the Albert Heijn application!

Albert Heijn is a supermarket serving its customers in the higher end of the market segment with sublime service. We came up with a disruptive technology for Albert Heijn to surpass the competition, a technology that is closely related to data analytics.

Data analytics is already a big thing within Albert Heijn. The data received from the customers’  ‘Bonuskaart’ is already in use. Until now, Albert Heijn has only used this information within the organization itself. The new technology consists of using this information retrieved from data analytics to serve the customer. In short: an updated and ‘smart’ list of recently bought groceries will be available on your smartphone. Together with the possibility to reorder products that are running low and let them be shipped right away to your doorstep the next day.

The data from the bonuscard concerning the customer buying behavior will be used to compute a list of suggested groceries. The application will know, thanks to the buying behavior data from the bonuscard, what products you normally buy on that specific day and how long ago you bought what particular products. So relevant to a specific day, week or month, dependent on when you consult the in-app groceries list a relevant range of products will be inserted to this ‘smart’ list for you to buy. Furthermore, the application will allow its customers to also order the products from the list right away via Albert Heijn’s existing home delivery service.

Since the application can track down what products or ingredients are in your possession, it can make suggestions for recipes. Albert Heijn already introduced ‘Aller Hande’, a magazine with recipes and it is now also available in the ‘Appie’ application. Linking the ‘Aller Hande’ recipes from the application and the new technology can personalize recipes for the customer. The data derived from the data analytics will suggest which bought products can be combined with recipes, which will create synergy.

Upon high market adaptation, this technology will result in less overhead costs since there will be less pressure on the offline stores. These stores can therefore decide to shrink their base of managers and employees and reduce supply costs. Albert Heijn saving a considerable amount of money and for the customer: going groceries shopping in the supermarket is history.

Written by 376122

Detecting Anomalies in Large Data Sets

Data has become a common concern recently. Both companies and individuals have had to deal with information in multiple ways in order to improve or obtain insight from operations. IT has allowed unprecedented new levels in data management for both these parties. This blog, however, intends to focus on companies’ management of data–more specifically, in the auditing sector.

Fraud has frequently taken place in markets historically. I like to think of Imtech as an example, for those who aren’t familiar with the company there’s no need to worry–I’m sure you have an example of your own. Drawing back to the topic of Data and Fraud, it is becoming increasingly difficult to accurately determine potential fraud cases with the increase of information available. This has given rise to the use of computer algorithms to detect these cases (Pand, Chau, Wang & Faloutsos, 2007).

An interesting way to tackle this challenge is to use mathematical laws for large numbers in order to determine anomalies within these data sets. One particularly interesting example is the application of Benford’s Law to detect these cases of fraud on company documentation (Kraus & Valverde, 2014). In short, Benford’s Law states that 30.1% of random, naturally occurring numbers starts with a 1; 17.6% with a 2; 12.5% with a 3, and so on. Logically this makes sense given our counting structure. This can be expressed as,

Where, is a number {1,2..9} and is the probability of the number starting with d.

Despite the fact that this method seems promising, Kraus and Valverde (2014), could not find any outstanding peculiarities from their data set that contained fraud perpetrators. However, this law does serve a starting point for a drill-down approach to discovering perpetrators. Which brings us to the more strategic topic of whether IT will ever develop a way to outsmart fraud perpetrators in this context? Is an eternal drill-down chase ever going to take the lead?

What do you think? Will this ever be the case? Is there any way you thought this might work out?

I think it’s pointless-of course, as everything, IT methods have their degree of accuracy. However, I firmly believe there will never be a way to completely ensure an honest and transparent market. Not long ago I heard a man say, “Does anybody here know what EBITDA stands for? Exactly. Earnings Before I Tricked the Dumb Auditor.” It’s human nature, and that might take millennia before it changes ever so slightly.

I’d like to say it was nice to write a couple blogs here, till the next time!

References

Kraus, C., & Valverde, R. (2014). A DATA WAREHOUSE DESIGN FOR THE DETECTION OF FRAUD IN THE SUPPLY CHAIN BY USING THE BENFORD’S LAW. American Journal of Applied Sciences, 11(9), 1507-1518.

Pandit, S., Chau, D. H., Wang, S., & Faloutsos, C. (2007, May). Netprobe: a fast and scalable system for fraud detection in online auction networks. InProceedings of the 16th international conference on World Wide Web (pp. 201-210). ACM.

Summaries; we miss them! (Digital Transformation Project Gr. 36)

Most of the Erasmus students buy summaries, or at least they have seen a lot of them around the University Library. Various summary providers are currently active within this business. They all try to help students to study more efficient and effective in some way.

These summaries are typical information goods; they can be seen as a container of information. The initial production is costly, but the reproduction costs are substantially lower (Shapiro & Varian, 1998). After writing and controlling the summary, the provider owns the content of a digital product, ready to be distributed. Currently these summaries are (mainly) distributed in a printed format only. However, besides purchasing them at brick-and-mortar stores, students can order most summaries via webshops as well. But is this model sustainable in a rapidly changing digital world? And why not selling these summaries in a digital format, so production costs can be minimized?

In the past decade, publishers have increasingly moved towards offering their books in a digital form: e-books. By 2013, the market share of e-books increased from almost nothing to 22% within five years. E-books have increased in popularity due to the possibility to store books on portable devices. Research has shown that we have 4.3 devices per capita in the Netherlands (Oosterveer, 2015)! According to the University Horizon Report 2012 of Johnson et al., students want to access their content anywhere and anytime. They want their digital content to be interactive, integrated and inexpensive. Furthermore research showed that students that used digital media performed as good as students that used printed materials (Connel et al., 2012).

Besides the e-book trend, a questionnaire has been conducted for this research. It was found that 96% of all students use a laptop or desktop for studying purposes while ‘just’ 82% of them is using printed materials. Smartphones and tablets are both being used by 25% of the students. Furthermore, 96% of the students is using summaries (writing summaries themselves, using summaries of friends, etc.). 46% is also paying for summaries. Overall, it can be concluded that laptop/desktop usage already outperforms the usage of printed materials among students for studying purposes.

Based on these findings and the rise of e-books, why not providing summaries in a digital format? To figure out if students would like such an online environment for studying purposes, respondents of the questionnaire were asked if they would like to have a similar environment for articles. We used articles since they are provided mainly in a digital form. The results are promising: 77% of the respondents would be interested in an online platform for articles. As this percentage is higher than the percentage of respondents that are currently buying summaries (46%). This implies that there is a group of students interested in an online summary solution, while they are not purchasing printed summaries now.

To conclude, there is no time to waste for summary providers. Digitize your summaries, minimize production costs and provide students an even more efficient and effective way of studying. Start offering summaries via an online platform!

Group 36 (B. Louwman / F. Wesselink / T.Langenberg / K.French / J.Mets)

References
Connell, C., Baliss, L., & Farmer, W. (2012). Effects of e-book readers and tablet computers on reading comprehension. International Journal of Instructional Media, 39(2), 131-140.

Johnson, L., Adams, S., & Cummins, M. (2012). The NMC horizon report: 2012 higher education edition. Austin, Texas: The New Media Consortium.

Oosterveer, D. (2015, June 29). Het mobiel gebruik in Nederland: de cijfers. Accessed on 10 October 2015, from Marketingfacts: http://www.marketingfacts.nl/berichten/het-mobiel-gebruik-in-nederland- de-cijfers

Shapiro, C., & Varian, H. (1998). Pricing Information. In Information Rules; A Strategic Guide to the Network Economy. Cambridge, MA: Harvard Business School Press.

Digital Transformation Project: Group 44 | Albert Heijn Digital Transformation

The good old meets the good new

Which one of the existing food retailers in the Netherlands is the oldest? It’s  – Albert Heijn.  Albert Heijn was founded in 1887 and today it is a leader in the food retail industry.  However, the recent stagnation trends in Dutch food retail market as well as the fierce rivalry may threaten the company’s dominant position. Therefore, we suggest that it is high time for the deep-rooted Dutch traditions of food retailing to embrace new technologies.

ah1

Inspired by shopping

“There was not a single screen,” said one team member commenting his recent shopping experience in the newly opened Albert Heijn store in Kralingen. The rest of the team agreed.  Yet adding a screen with a company logo or simple advertisement does not provide a company with exceptional value and is surely not a source of digital transformation. Bearing this in mind, we came up with a sophisticated targeted in-store promotion system. The system shows customized individual promotion to every customer that walks nearby as well as other fascinating functionality.

How does it work?

A customer with the Albert Heijn app walks into the store. The phone automatically connects to the free Wi-Fi. The CRM (customer relationship management system) informs a decision engine that a customer is near a certain screen in a particular store. The decision engine then takes the information from the CRM and advises the CMS (content management system) to display an advertisement relevant for the customer as he walks by the screen.

ah2

Actually, to make this system a reality, not many new modules are required. Each large retailer already has established CMS, CRM, Sales and Inventory monitoring systems in place. The key challenge lies in the connection and integration of all of them.

What are benefits of this system?

We decided to illustrate the benefits of our system with some real life examples.

Example 1. Pushing complimentary sales. Let’s assume that the most sold good on Friday evening is red wine. Red wine goes very well together with cheese. Therefore, our system will kindly remind customers every Friday evening about adding delicious cheese to red wine.

Example 2. Upselling. Friday evening again, the sophisticated system already determined that the most sold product is red wine. Hence, the system screens kindly recommends you to try a premium wine this time (and a better cheese as well of course sure).

Example 3. Excess Sell Off. Though one can say that “there is never too much cheese and wine”, food retailers might object. If the cheese warehouse is overstocked and the cheese runs the risk of going bad, the sophisticated system is projecting ads that are persuade you to treat yourself with some delicious cheese until the excess stock is sold off.

ah3

Summing up

The installation of digital screens in store, the development of a smart decision engine and the linkage of multiple existing systems providing different data opens up multiple possibilities for Albert Heijn to tap into their vast data pool and extract and use relevant knowledge from it.

Group 44 – Digital Transformation Project

References

Ahold Group. (2014). Ahold Annual Report 2014.

Euromonitor International. (2015, 10 9). Albert Heijn BV in Retailing (Netherlands). Retrieved from Euromonitor Passport: http://www.portal.euromonitor.com/portal/analysis/tab

Digital Transformation Project – Hotel Okura Amsterdam

Imagine entering your hotel room after a long flight. You are hungry and tired, but realized you forgot to make a reservation in your favourite restaurant within the hotel. You turn on the television, and you are greeted by a message stating that there are still two more tables left in your favourite restaurant. You indicate that you would like to reserve a table for that evening. When unpacking your suitcase, another notification pops up, asking you whether or not you would like to order a steaming cup of hot chocolate, as you have regularly ordered after a long flight.

mockup okura

Hotel Okura Amsterdam (HOA) is a five-star Japanese hotel located in Amsterdam. HOA recently acknowledged the urge for an interdepartmental IT system integration to improve personalization and therewith customer satisfaction; the company currently operates 40 different operating systems. These insight together with many others were obtained during an in-depth interview on business and IT strategy with Okura’s Rooms, Engineer and IT manager. The business strategy of HOA is dedicated to being ‘’Unique and Complete’’, making striving for a high level of customer satisfaction key; a question in this is how a customer can be convinced of the uniqueness of HOA.

The interview brought to light that the non-integrated structure results in inefficiency. Each division registers its own data and information between divisions is transferred verbally instead of it being retrievable from a centralized data system; many opportunities are lost due to this. The current business strategy is to be improved by integrating an IT infrastructure with IT related processes. The proposed solution therefore strives for a high level of integration. However, due to the issue of scale and the importance of (financial) feasibility of the project, the first generation will solely focus on combining the F&B (Food & Beverage) system with the hotel room system. The solution itself, the infotainment which is further explained below, does have a long term focus of eventually integrating all of Okura’s 40 different operating systems.

The trends of superpersonalization and big data to enhance customer value, in combination with the need for responsive service and modern facilities in the room (current guest satisfaction regarding room technology is low), result in the following proposed solution. To cater for the business need of HOA, we propose to provide real-time personalized information in the hotel room of the guest through a television application. Various systems will be able to communicate with each other and can provide the guests with useful information (or upselling). The system will include the reservation process for the restaurants, the room service information and the room service ordering process. The F&B is initially focused on as this is the main source of income from hotel guests for HOA and it limits the initial investment. Additional functionalities can be added at a later stage.

Authors (BIM2015 – Team 6): 

  • Stéphanie Visser – 407153
  • Job Deibel – 407756
  • Dirk Breeuwer – 329445
  • Jord Sips – 421144
  • Colin van Lieshout – 414788

Innovation at Disney: creating magic with technology

The imperium of Walt Disney is well known for creating children’s movies that have become classics. The world of Disney is beloved by children all over the world for its magical theme parks full of fantasy. But did you know that this magic is made possible by continuously innovating throughout the years? In this blog, I want to show you a recent innovation at Disney.

The Disney Magic Band

The Disney Magic Band is a technology-packed wristband that every visitor will wear during their visit to the park. In combination with the Disney World app, the Magic Band will provide the excited visitors the most friction-less theme park experience possible. This is how it works:

A family books their Disney World tickets through the Disney World app. After ordering tickets, they also choose to reserve a table at one of the restaurants and pick their meal of choice while they’re at it. Furthermore, they also put in the rides and other attractions they like best.

At the park, the family is wearing their Magic Bands they received by mail a week earlier. They approach the restaurant and get greeted by name immediately. The family gets seated and, without having to order right then and there, their food gets delivered to them. As the Magic Band is linked to their account, all orders get paid by ordering through the app or by contactless payment with the Magic Band at the cashier.

This is made possible by the RFID chip and the 2.4GHz radio in the Magic Band. When the family approaches the restaurant, employees get a notification with the families’ personal info and their order gets sent to the kitchen. The restaurant is just one example of many events in the theme park that become more comfortable using the Magic Band.

Disney has always been an innovative company and they stay on top of the game with inventions like the Magic Band. Although some people don’t like booking everything upfront, the Magic Band makes sure a visit to Disney World is as comfortable as it can be.

References:

http://www.wired.com/2015/03/disney-magicband/

Digital Transormation Project: Suzuki & the autonomous vehicle

When talking about the future of transportation, the last company you would think of is Suzuki. This Japanese company specializes in designing and manufacturing passenger cars, motorcycles and several other non-vehicle related machines. While we get many signs that the transportation industry is changing with companies like Mercedes-Benz, Tesla, Google and Apple making headlines about electronic and self-driving cars. However Suzuki has not announced any change in its business model and is threatened to get left behind in this changing environment.

Most of Suzuki’s revenue comes from its automobile sector, the company’s strategy is clearly focused on the production of small and subcompact vehicles. The management however is more focussed on its current organizational structure and not on future innovations.

As the automobile market is changing and Suzuki is forced to make a descision on how to proceed onward. We proposed a solution that allows Suzuki to manufacture their own self-driving cars.

The technology behind the autonomous car is not an easy one and its success is dependant on many technical, political and social factors. For an autonomous vehicle to actually function, changes in road infrastructure and vehicle composition is vital. The so called V2I (Vehicle-to-Infrastructure) and V2V (Vehicle-to-Vehicle) communication technology is used by the self driving car to be able to calculate risks and take pre-emptive action to avoid and mitigate crashes as well as detect stop signs, signal status’, speed limits, surface conditions and pedestrian crosswalks. Besides this the car itself will need to have the Light Detection And Ranging (LIDAR) technology, which is the main source of how self driving cars will ‘see’ the world they operate in. By projecting dozens of laser beams around 360 degrees of the car. Through this it is able to create 3D images of objects, which helps the car see potential obstacles in its way. For the self-driving car to have any chance on commercial success, government legislation concerning liability limitation will have to be created, so that car manufacturers are not wholly responsible whenever an accident occurs with an autonomous vehicle.

The automobile industry is very likely to have its most dramatic shift in history. Many of Suzuki’s competitors are already very advanced with this technology so Suzuki will not have the first-mover advantage. However even with this fact we recommend that Suzuki does in fact start developing its own self-driving car. They should be an ambidextrous company, which means that to protect the traditional business and develop disruptive innovations simultaneously. If Suzuki fails to adapt to this shift in the industry, they will likely suffer tremendously. Lets hope Suzuki heeds our advice and does not end up like Kodak of the automobile industry.

 

References:

Siva, S.R.K. (2013),’The Evolution of Connected Vehicle Technology: From Smart Drivers to Smart Cars to… Self-Driving Cars.’ ITE Journal, Volume 83, no. 7, pp 22-26.

 

E-commerce against poverty

One of the main goals of charitable foundations, non-profit organizations and philanthropists around the world for the decades and centuries has been fight against the poverty.

Although great work has been done so far (in last 25 years absolute poverty has been reduced by half) there still is a huge space for improvement.

One of the promising trends that could help fighting world poverty at a really large scale and actually seems to be a breakthrough in this field is the rise of digital technology. But how latest technologies could help countries where very basic needs like need for food and shelter still are not satisfied? What could sophisticated smartphones and neat apps do in poor countries? Actually, much more than in developed ones.

One of the main things needed to help people move out of poverty is availability of, at least, basic financial services. Opportunities to save and borrow are crucial for development of the economies, but they are missing in poor countries where financial infrastructure is limited or non-existent at all. People cannot borrow money for kids’ education or for buying seeds and fertilizers, they cannot buy insurance to protect their future harvests; they cannot save money (in cash) because risk of that money to be stolen is extremely high.

Digital technology can make payment systems and digital transactions very inexpensive, easy to use and accessible to everyone.

Video: Digital payments in Kenya

A smartphone and an app with a simple interface create access to digital payment platforms. Surprisingly enough, a very few people in, for example, Bangladesh have bank accounts, but a lot of them do have smartphones. At first these digital payment possibilities were used to make transactions between users, but soon merchants realized that they could directly accept mobile payments, which actually creates digital currency.

One of the greatest success stories in the history of serving customers in the poorest countries is M-Pesa, mobile-phone based money transfer and microlending service that allows people sending and storing money on their mobile phones and converting that money to cash through a nationwide network of agents. The service was launched in 2007 and by the end of 2013 43% of Kenya’s GDP flowed through M-Pesa.

There are also other success stories. Probably Somali is the last country you would expect to have developed digital payment platform, but it is so widely used there that people hardly cash out.

The main reason why such technologies work in one countries and are still not used in other is differences in regulations. Therefore to enable the development of digital financial platforms governments should work on regulatory frameworks that favor the development of such services.

As it is stated in 2015 Gates Foundation annual letter, published by the Bill & Melinda Gates Foundation (organization putting a lot of effort and investment in digital enablement of poor countries), “the lives of people in poor countries will improve faster in the next 15 years than at any other time in history.” And according to Gates, innovation will play a vital role in that.

Sources:

http://www.huffingtonpost.com/2015/01/22/bill-gates-annual-letter_n_6523880.html

http://www.csmonitor.com/World/Making-a-difference/Change-Agent/2014/0106/M-Pesa-helps-world-s-poorest-go-to-the-bank-using-mobile-phones

http://www.gatesfoundation.org/What-We-Do/Global-Development/Financial-Services-for-the-Poor

http://www.scmp.com/news/world/article/1689327/bill-gates-predicts-2030-poverty-breakthrough

 

NEW TECHNOLOGY TO FIX YOUR WET PHONE

Have you ever dropped your phone in water? Or spilled water in your backpack? If you are the clumsy type like me, carrying around big water bottles all the time, this is a permanent risks factor in your life. The most important thing to remember is DONT SWITCH IT ON! I can’t stress this enough, because in that stressful moment, when you really would like to find out whether you ruined your device, this rule requires a lot of self-discipline. The best strategy is to take the battery out (if you can) and then leave it dry for two days in rice or silica and of course, hope for the best. They will soak up the water and your device will hopefully work again.

But recently , there is another way to solve this issue. A company called Tekdry in the US dries the wet gadgets in special machines that literally pull the water out of them in a vacuum chamber. The customers pay 70 dollars only it the case the procedure was successful, which is a fair price if we consider how much a new phone/ laptop would cost. “TekDry’s machines can dry phones in 30 minutes with an 80 percent success rate if you bring it under 48 hours of getting your phone wet.” Doesn’t it sound like a miracle?

Take a look! I really looks awsome:

This technology is pretty convincing, so as a business student, shouldn’t we consider opening a similar chain in Europe (or even Asia)? Although it sounds like a great opportunity, in a few years probably all our electronic devices will be waterproof. The IPhone 6s has gaskets around the edges and seals around important components to protect the phone from water damage and there are already countless waterproof electronic devices, so the technology already exists.

References:

http://www.tekdry.com/

http://uk.businessinsider.com/this-company-will-dry-your-phone-with-a-vacuum-chamber-2015-10

Future of IKEA: Augmented Reality

Schermafdruk 2015-10-16 21.07.19Schermafdruk 2015-10-16 21.07.37

Have you ever bought a product from IKEA and wondered why you bought it. Or worse, it doesn’t meet your expectation at all. The couch you really wanted is either too big, too ugly or it doesn’t totally match your newly bought curtains. Fear no more! While technology is changing every day, IKEA has found a way to be at your service and fix the above mentioned problem. This blog elaborates on a new technology which will become more mature in the near future: Augmented Reality.

ASchermafdruk 2015-10-16 21.08.12s new disruptive technology, we took Microsoft’s Hololens an augmented reality (AR) enabling device and analyzed how it fits within the business model of the world’s largest furniture and home appliances retailer: IKEA. The Hololens is a new Head Mounted Display which enables its users to augment new objects in the real world. For example, customers can virtually try out whether an IKEA product will fit in their room and which color or customization fits their interior and preferences the best. With augmented reality, you see how the objects would look like in the real world instead of a virtual world.

When Augmented Reality is implemented in IKEA’s current business model, it is expected that it will allow for increased sales through offline and online channels, improved customer experience, and customer support. In addition, IKEA can realise cost reductions due to reduced showroom space, lower prototyping costs, and speed up the design processes.

improved customer experience, and customer support…Ikea-launches-augmented-reality-catalogue-1288x724

The use of Augmented Reality technology and the Hololens fits very well within IKEA’s current business model as well in its current information system strategy. In general, IKEA is perceived as a modern and innovative company, but they have currently made insufficient effort in the move to e-commerce. Most of the technology as well as information systems which are crucial to successfully implement AR technology are already present within the company, giving them a competitive advantage for the future of online retailing. The information systems in place are their webshop, 3D models of its products, 3D building tools and a basic mobile Augmented Reality application for phones and tablets. 

Schermafdruk 2015-10-16 21.14.24Additionally, IKEA has always been focussed at lowering costs in all aspects of the business, as their price/quality attracts the major part of its customers. The Hololens will provide opportunities to further push costs down in varios aspects of the business, making the company more profitable.

.. opportunities to further push costs down…

Implementation of the Hololens is possible without too much alteration of the current structure and systems: it is financially, technically, legally and operationally feasible. However, it will still be a future challenge for IKEA to meet the demands generated by remote shopping over mobile applications and the Internet. But in the end, implementing and using the Hololens will provide IKEA as well as its customers with lots of benefits.

As a team, we can’t wait for this implementation. We hope you are thrilled too…

Team 23

H. Gouiza – 322226

K.H. Schaap – 358985

G.S.G.M. de Jong – 357570

T.R. Jordan – 400986

J.S. Langbroek – 336822

Digital Transformation Project: Typ Agency

The introduction of the Internet has not only changed whole travel experiences, but it has also turned the entire travel industry upside down, as new companies emerged to take advantage of the internet as a distribution channel, while many existing players were left struggling to keep up with “going online”. For our Digital Transformation Project we decided to analyse one of the “old” players, a Czech travel agency with more that 23 years of history: Typ Agency. With the Internet crawling with competition, Typ Agency is aware that a change is needed in order to remain competitive and attract more clients.

In our report we analyze different ways in which Typ Agency could embrace technology in order to improve its leisure traveler base – until now it was mostly focused on the business travel side of the Czech travel industry. The first option considered focuses on the development of a mobile application that would allow leisure travellers to browse travel deals and book flights, hotels and other travel products offered by Typ Agency. The second one is the social media option, in which the travel agency will sell its travel products through social media channels. As a third option, a null option was considered, but this option has been discarded, as a move into current technologies will be needed to stay competitive in the future.

After considering multiple KPI’s and a cost benefit analysis, we have chosen to implement the social media option. By implementing this option we expect that the premium service Typ agency currently offers mainly to its business clients and 24/7 crisis resolution, will lead to trading out behavior among leisure travelers seeking premium service as well, and thus choosing Typ Agency over cheaper offers with a lower provided service (Li, Kauffman, van Heck, Vervest & Dellaert, 2014).

With a social media presence (to start with on Facebook and Twitter), we expect to create a customer want to travel and to motivate them to book quickly, without having had the intention to go travelling when starting to use the social media platform (Bennett, 2012). The Facebook Buy Button, which will allow Typ Agency to start selling their B2C travel directly through Facebook, will be implemented as well. Another technology Typ Agency will use is auctioning travel bundles through social media. This is possible on Facebook with BuddyBid. Auctions in fact tend to create excitement and competitiveness among customers and this can lead them to spend more money on a bid than they would usually be willing to pay (Adam, Krämer & Müller, 2015).

The main benefit of the social media option is the relatively small investment required for implementation. Typ Agency could increase sales in the B2C travel sector, without having to incur big development costs. Another benefit is that the social media strategy can be started quickly: it is expected that Typ Agency will be able to use social media platforms to interact with customers and to advertise offers within approximately four to six months.

As mentioned before, currently Typ Agency does not have the capacity to interact properly with its leisure travel clients, as they are focusing more on the business travel side of the Czech travel industry. Therefore this social media strategy seems to be the best opportunity to move forward into new technologies and attract new leisure travellers, without compromising the service level for B2B customers.

Bibliography:

Li, T., Kauffman, R., van Heck, E., Vervest, P., & Dellaert, B. (2014). Consumer Informedness and Firm Information Strategy. Information Systems Research25(2), 345-366.

Bennett, S. (2012). Social Media’s Influence On The Travel Industry [INFOGRAPHIC]Adweek.com. Retrieved 2 October 2015, from http://www.adweek.com/socialtimes/online-travel-industry/467349

Adam, M., KrÄmer, J., & Müller, M. (2015). Auction Fever! How Time Pressure and Social Competition Affect Bidders Arousal and Bids in Retail Auctions. Journal Of Retailing91(3), 468-485.

Team 16

Milou Saraber      366867

Matilde Zanoli      437890

Natalie Jonasova 356767

Teresa Stacey      441696

Svenja Stein         370033

Digital Transformation Project: Team 26

v-swatch

Swatch, the iconic brand part of the Swatch Group Ltd., has been crucial for the Swiss watch industry due to the disruptive technology of the Quartz movement in 1970. Nowadays Swatch is still popular among a wide range of customers because of their fun and colorful designs. To secure a further growth Swatch has to keep innovating their products and their business model. Focusing on the eCommerce trend, the introduction of new technologies such an augmented reality application will be a solution for Swatch in order to attract more customers and improve the customer’s experience. The new 3D fitting technology will influence the product uncertainty and enhance the customer purchase journey.

What is 3D fitting?

augmented-reality-in-advertising-retail-0

This system will enable the customers to ‘try on’ the watches on virtual level. The customers no longer need to visit the physical stores to see how the watches look on their own wrists. Simply by presenting their wrist on front of the camera of their personal computer, smartphone or tablet, v-Swatch will display the watch on customer’s wrist as if they are wearing them in real life.

Advantages of the v-Swatch

This new technology offers several advantages to Swatch. Since this technology has been rarely used in the watch industry before, implementing 3D-watch fitting will maintain Swatch position as an innovative benchmark in the industry. v-Swatch enhances the convenience of online shopping experience within the trusted borders of your home. Because of the user-friendliness nature of the technology, it is easy for users to understand how it works and therefore the technology will be used frequently. The 3D-watch fitting technology enables users to view the watch in real time images from different angles. In addition with the 26 measurement of customer’s wrist, this technology provides the perfect advice about the products and therefore helps the consumers to make a proper choice about their potential purchase.

Although the new technology offers many benefits for Swatch, it still has flaws that could not be conquered. No matter how real time interacting the v-Swatch technology might be, it is still within the virtual framework. Therefore, real life interacting with the products is not possible, which could be the critical factor for customers to decide whether they are going to make the actual purchase or not.

An estimated increase of sales between 15%- 20% after implementing the new technology. Since the Swatch Group is determined to increase investments in marketing and sales activities, we believe this project should be financial feasible. On the technical aspect, the only hardware customers need is devices with built-in camera which are able to display images and motions on a screen. Since personal computers, smartphones or tablets are common devices to possess nowadays, it is technical feasible for the technology to reach the customers. Overall, this new augmented reality technology will reduce product uncertainty with help of OL and WOM. It enhances the image of the product in consumers’ point of view which can in turn lead to higher customer satisfaction, higher revenues and higher in-store service levels when probability of repurchases could be enhanced, whether online or in the physical stores. Although it is a large investment, we still recommend to implement this technology since v-Swatch will enhance the sales of watches and therefore add value to the company to maintain its position as innovative benchmarker within the watch industry.

Would you like to try the v-Swatch? Do you think this technology will contribute to Swatch’s revenues?

References

Potter, S. (2013) The History of Swatch.

http://watchnews.nawcc.org/the-history-of-swatch.html, 08 October 2015

Singh, B. (2015, 3 28). Taking eCommerce to the Next Level with Augmented Reality., from iamwire: http://www.iamwire.com/2015/03/eCommerce-level-augmented-reality/112915

Digital transformation project – Boijmans van Beuningen Museum

The Boijmans van Beuningen museum aims to provide its visitors with an exciting experience by showing them inspiring, amazing world class art collections. In order to achieve this, a considerably high budget is needed, from which almost 50% is funded by the government. Given thefact that the government has announced that the amount of subsidy will decrease dramatically in the coming years, the museum is forced to find an extra stream of revenue that could cover up for this future income loss. This is essential both for customer satisfaction and future business growth.

In this report, a potential solution that could generate additional sources of revenue is proposed. Currently, the museum has around 300,000 visitors on a yearly basis, with entrance fees accounting for 20.3% of the generated revenue. The number of visitors could be increased by embracing the latest technologies that could enhance the current museum experience significantly. Augmented reality, one of the latest but most developed technologies to date, would serve this purpose perfectly. Using augmented reality technology inside the museum enables visitors to easily access additional multimedia information about artefacts, explore 3D models of augmented artworks and access archived artworks that used to be not displayed due to space constraints. In order to make the museum experience even more revolutionizing, the museum could integrate beacon based technology, it is a Bluetooth enabled tracking technology that allows visitors to instantly receive relevant information as soon as they get close to a specific artefact. Apart from the improved customer experience, the museum also gains insight in visitor behavior, since it can track the paths that visitors follow through the museum and which areas are visited most. These insights can then be used to improve future museum experience, of course these insights will only be used with permission from the visitors.

In terms of technical feasibility, the augmented reality technology in combination with the beacon based technology have already been developed and tested in the museum industry, so it has also been proven that it is technically feasible. Having looked at the IT facilities present at the museum, an Augmented Reality app would fit into their future plans. Additionally, the Boijmans van Beuningen museum has already had experience with augmented reality, since they used it for a one-day exhibition that was perceived well. Therefore, it can be stated that the willingness to cooperate from the organization in this project is very likely. In addition to the numerous benefits this technology entails, the financial part also plays a significant role in the deployment of this augmented reality technology. However, the implementation of this technology is expected to pay off within a short time span of a few years, since not only the visitor numbers are increasing, but it is also expected to lead to an important boost in terms of press and media attention, which improves the museum’s brand image.

To conclude, the benefits of adopting augmented reality greatly outweigh the costs that also come along. Therefore Boijmans van Beuningen museum is advised to embrace this technological transformation.

By Group 5

Sjaak Meeuwsen – 437156

Claude Zwicker – 437277

Yinuo Jin – 373227

Hidde van Heijst – 436800

Ruud Schippers – 441698

Super-intelligent Artificial Intelligence: The last invention in Human History? Part 2.

Is immortality within our reach or are our predictions too enthusiastic?

According to the futurist Ray Kurzweil we will enter into a technological singularity in 2045, resulting in potential immortality. How Kurzweil envisions our immortality is by plugging our consciousness into a computer. This will mostly be due to AI related results. You can find more explanations behind his rationale in his movie: ”The singularity is near”. Two movies I advise you to watch are called “Her” and “Transcendence” in order for you to get a more tangible understanding of Kurzweil’s propositions.

Other experts predict the Singularity will take place later in the 21th century.

In opposition, other experts are very skeptical as to the meaningful impact AI can have on humans. One of those members is Andrew Ng, founder of Coursera and Chief Scientist at Baidu Research in Silicon Valley. He has been the author of over 100 published papers in machine learning, robotics and related fields, naming him one of the leading experts in AI would be an understatement.

Ng believes the perceived AI threat is equivalent to worrying about “overpopulation on Mars”

Hearing likewise news from a -if not the main –leading expert on AI and ML, could sober some of us in outlandish speculations.

It must be noted, that Ng does not declare the AI threats or opportunities as impossible. Rather, it seems to be a far more distant worry than is currently portrayed. As a matter of fact, Mars can be colonized and its atmosphere can be converted in a similar fashion as Earth’s. This WaitbutWhy post gives a good overview of how it can be made possible.

After having covered those different parties, what do you think yourself? Do you believe AI will have a life-changing impact in our lifetime or do you think we will be disappointed by the current speculations?

354502

Sources

http://waitbutwhy.com/2015/08/how-and-why-spacex-will-colonize-mars.html

https://en.wikipedia.org/wiki/Technological_singularity http://www.technologyreview.com/view/425733/paul-allen-the-singularity-isnt-near/

http://www.kurzweilai.net/the-singularity-is-near-movie-available-today

https://en.wikipedia.org/wiki/Andrew_Ng

http://fusion.net/story/54583/the-case-against-killer-robots-from-a-guy-actually-building-ai/

http://futureoflife.org/AI/open_letter_autonomous_weapons

Digital Transformation Project: Dutch Healthcare sector

Healthcare is one of the prime sectors in any economy and is one of the most important drivers behind expanding economic opportunity. The growth of this sector is significant over the years which has contributed to the life expectancy improving globally. The life expectancy in Netherlands rose from 77 in 1990 to 81 in 2013 (WHO, 2013). There is significant improvement in the efficiency of the healthcare services and one of the main reasons behind that is information technology. It has helped in rendering healthcare services more quickly with lesser effort and man power.

Improvement in life expectancy has led to higher healthcare expenditure as people in their old age require more medical help. To reduce healthcare costs we are offering an innovative IT structure for the Dutch healthcare system. Our offering focuses on the restructuring of the Dutch Healthcare databases to one centralized database. Along with the centralized database we are also introducing an application, where the users can upload data rendered from their wearable devices. The data from the app and the data from the centralized database is then processed by our Business Intelligence unit. We have chosen IBM Watson health as our BI Unit as it has already been proven to be effective in assisting medical staff.

The inclusion of a centralized database and a Business Intelligence unit will give more relevant information to the medical staff who would be able to make more informed decisions. This in the long run will greatly reduce healthcare costs with prevention of diseases and early detection of chronic diseases like Cancer.

In our offering we have laid great stress on privacy concerns and provided reasonable solutions for implementing such an IT structure as earlier too there was an attempt by the Dutch government to have a centralized database for healthcare but it couldn’t work out because of privacy concerns.

If implemented, the new technology would be a definite boon, providing both economic and social benefits. It will reduce overall healthcare costs, help medical staff by providing more relevant information for diagnosis and most importantly help the users by early detection and prevention of diseases.

Team 25

437457aj        Amogh Jain

437682et       Ewa Tulodziecka

429370gk      Gaurav Kumar

367347hl       Hanzi Li

441728zh       Zsofia Hajnik

The future of Coffee Company

coffeecompany

According to Mastercard’s chief payment officer a payment is a by-product of a consumer trying to do something else, and using technology in the payment process is about making that thing you are trying to do that much easier (BusinessInsider, 2015). We took the essence of this, the convenience customers are demanding, and applied it to Coffee Company, a Dutch chain of cafes. Essentially, by investing in the correct technology we believe Coffee Company has the opportunity to improve the way you get your morning coffee. This technology is mobile payments, but first let me explain how we arrived at this conclusion.

Currently Coffee Company has little information of their customers on a general level, and even less to no information on an individual customer level. Furthermore, their loyalty programme is made up of the generic stamping cards typical for coffee houses. In an age where understanding your customer needs and having good insights into customer satisfaction is key, Coffee Company has a lot of opportunities to grow and learn about their coffee drinkers. Therefore, the company must come up with a method for collecting individual customer data and directly interacting with them in a way that is convenient for the customer as well.

The peak times for most Coffee Company cafes are during the morning rush hour and lunch, however currently all three phases of getting your coffee need to happen at the point of sale (i.e. in the cafe). These three phases are 1) ordering 2) paying 3) pick up.  However if it were possible to eliminate the first two steps then the customer would save time in the store, and the staff in the store could be focused on the most important phase from them; making coffee.

Mobile payments emerged as the optimal solution for Coffee Company because it addresses both of the problems we identified in our analysis of the firm’s current use of IS and their overall business. Additionally, it allows them to counter the threat of competitors offering similar services, such as Starbuck’s Skip-the-line application that is slowly being introduced.

So let me walk through how we imagine the application would work: I open the main menu and my three favourite items to order appear at the top of the list, alongside a current offering Coffee Company believes would be the best fit for me; all based on my historical data and the embedded loyalty card in my application. I then choose the items I wish to order, pick a pick up location in my vicinity with a time frame of when it could be available for pick up. I then click the ‘pay’ option with a card that I entered when I first registered my account.  

The type of mobile technology that is being used here is called Wireless Application Protocol, because my phone is acting as a payment platform. It was essentially we chose a mobile technology that allowed us to pay before arriving to the café, because this would the Coffee Company customers to skip the queue ask skip right to step 3) picking up their order.

This mobile application with the embedded loyalty card and mobile payment capabilities is the transformation Coffee Company needs. The information that can be gathered through this application will provide Coffee Company with a continuous and growing wealth of knowledge on their customers that was not possible to collect in a non-intrusive way beforehand. They can then use this information to inform their strategic business decisions because they have a better understanding of their customers. Then when these strategic decisions are implemented in the form of new offers or improved operations in the store, we come full circle because the customer benefits from these informed changes.

Au and Kauffman. 2006. The economics of mobile payments: Understanding stakeholder 3 issues for an emerging financial technology application. [ONLINE] Available at: http://www.misrc.csom.umn.edu/seminars/2007-03-09/au_kauffman_ecra2007_galley_proof.pdf. [Accessed 13 October 15].

Bloomberg. 2014. These Apps Mean You’ll Never Wait in Line for Coffee Again. [ONLINE] Available at:http://www.bloomberg.com/bw/articles/2014-11-26/preorder-food-coffee-apps-can-boost-restaurant-sales. [Accessed 11 October 15].

BusinessInsider. 2015. The future of mobile payments: Are we heading toward a cashless society?. [ONLINE] Available at: http://www.businessinsider.com/sc/mastercard-mobile-payments-2015-2?IR=T. [Accessed 14 October 15].

Group 45 Digital Transformation Project Blog Post

DTP Team 37: B2B E-commerce for Kraker Trailers

Kraker-Trailers-Polen-groot

This project will try to tackle some of the problems with B2B e-commerce by investigating a real-life company, Kraker Trailers, and focusing on the theories of B2B e-commerce and niche markets. The setup of this investigation is involved around a series of interviews with a top-level employee of Kraker Trailers with the aim of gathering information to (a) analyze its business, (b) its business model, (c) its use of IT and information in general and (d) discover its current business problems/needs.

B2B e-commerce increases efficiency, reduces costs and improves the overall quality of products/services. It links well to Kraker Trailers in a sense that Kraker Trailers is relatively new to B2B e-commerce, experienced fast growth in the past but expects a decreasing growth rate in status quo position, and B2B e-commerce might provide solutions on multiple fronts.

Kraker Trailers is a B2B firm which produces and supplies moving floor trailers, a special sub category of trailers, mainly to companies within the agriculture, biomass and recycling industry. In the past ten years it has seen an average growth in sales of more than 17% per year. However, they supply only in Europe and fear decreasing sales due to a slow growing market and fierce competition. They are tackling this problem by building a new, more efficient factory and expanding overseas. Kraker Trailers acquired the services of a major Dutch IT firm, CE Masters, to completely revamp their IT landscape. CE Masters will install a new ERP and CRM system which will increase Kraker Trailers’s efficiency and improve their competitiveness.

There are however still a few issues with their current business as the information flow between Kraker Trailers and their (independent) dealers is not perfect and hampering sales. Their main concern is the way their dealers process incoming information about (new) products and how they communicate this to potential customers. Currently, Kraker Trailers’s dealers extract product information about (new) trailers via a download link provided by Kraker Trailers. The disadvantages are that the content is unorganized, unpresentable, difficult to access in regions with an unstable internet connection and difficult to update. This leads to the external disadvantage that dealers each use the content in a different way, generating an unprofessional image to potential customers.

Based on B2B e-commerce theories and with the aid of niche market theories, we propose a cloud based communication tool (Instant Magazine) which perfectly suits Kraker Trailers’s needs. This tool creates both an online and offline platform for Kraker Trailers to upload and maintain (new) product information and for dealers to extract this information. It has the added benefits of combining both the cloud based product platform with tools to track dealers’ behaviour, creating tender offers and professional product presentation to potential customers.

DTP assignment Group 43: Automation for everyone by everyone!

Company X: Automation for everyone by everyone!   

*Due to confidentiality requirements, the company name has been replaced by a pseudonym for this summary: Company X*

  1. Introduction

Company X is currently using SharePoint Designer for business process automation (workflows). However, Microsoft recently announced that it will discontinue SharePoint Designer in a few years. Therefore, it is recommended that Company X starts the implementation of a new technology due to its reliance on workflows.

  1. Company X IT model

According to Gartner’s enterprise information management (EIM) maturity model (Newman & Logan 2008), Company X’s IT model is at the Proactive maturity level and is developing towards a managed level. The company has not reached the latter level because (1) data management best practices across functions/geographical regions are still limited; (2) there are no defined data stewards to ensure data quality in the organization; (3) stand-alone analytic applications and separate MDM systems  are still used; and (4) there are no standard metrics to identify productivity gains from IT implementations.

  1. Technology business justification

With the focus on innovation, successful companies are pursuing the right tools to automate and improve business processes to increase efficiency. Company X makes use of this workflow management to (1) save time, (2) improve compliance, (3) increase accuracy, and (4) prevent coordination errors.

  1. Current state: SharePoint Designer

Company X uses SharePoint Designer to create workflow enabled solutions. An example is its use for track-and-tracing maintenance requests. This is a software that is free and available for all. However, it is difficult to use for general users without programming skills. Therefore, the workflows are often managed by IT specialists. The current issues are: misunderstandings between business and IT, and waiting time for the workflows to be ready. Consequently, the business wants to avoid the ‘queues’.

  1. Proposed state: Nintex

The proposed technology is Nintex, a drag-and-drop tool allowing anybody to build workflows without programming. It is expected that automation will increase, resulting in organizational productivity. Nintex was chosen over competitors because: (1) it has the easiest user interface and user experience, (2) tighter integration with  SharePoint and Outlook, and (3) lower price level.

  1. SWOT: SharePoint Designer vs. Nintex

The most important strength of Nintex is being usable by non-technical users, while the weakness of SharePoint Designer is requiring programming knowledge. IT will no longer have to spend time learning the business process to automate. However, implementing Nintex will result in a few potential threats; (1) general users making mistakes, (2) users duplicating workflows and (3) the dependency on the company Nintex.

  1. Conclusion

The project plan is focused on piloting and incentivizing adoption by traditional and non-tech savvy employees. Company X  Management needs to consider the following; (1) engagement and partnership of IT consultants with end-users, (2)  proper communication with stakeholders regarding technology benefits and potential gains in time savings, (3) encourage user feedback, and (4)   cooperatively implement user feedback.

Group 43:

Students:

D.C.M. Breemans, 373666

L. Geniz Shann, 342890

R. Laarabi, 371492

A.D. Okci, 366348

Digital Transformation Project: FridayEuroTech and an online platform

For the Digital Transformation Project we have suggested a disruptive innovation for a recruitment agency called FridayEuroTech.

DTP blog

Who’s FridayEuroTech?
Founded in 1999, the company is focused on providing technical employment services and is mainly focused on scaffolding, insulation, maintenance, mechanics and staffing personnel. The company operates internationally and is currently located in the Netherlands, Belgium, Germany, Poland, Lithuania and Romania.

Currently, the only way FridayEuroTech acquires new customers is through word of mouth marketing, meaning that potential customers only find out about the company when someone from their network talks about it. While other recruitment agencies are making the shift towards using the internet for their practices, FridayEuroTech’s use of technology still offers a lot of space for improvement and new implementations.

The new technology
The current use of technology is mainly based on internal use through an information system called UB+, where all the information about temporary workers is stored and its goal is to support the everyday operations of the company. To improve the communication with its customers and in order to keep up with its competitors, we provide FridayEuroTech with the idea of Internet Recruitment. Internet recruitment in itself is not relevantly new. However with the rise of sites such as LinkedIn, the industry is changing. Companies now have the opportunity to avoid recruitment agencies and find employees directly on similar social networking sites as this is less costly.

It is important to keep in mind that the company operates in a very specific industry and does not cater to all audiences like regular employment agencies. Therefore we propose to build an online platform in which the company acts as an intermediary between employees (temporary workers) initially in The Netherlands and Belgium and the employers (companies) in their current and similar industries. On this platform potential temporary workers can register themselves and present FridayEuroTech with information on their education, experience, diplomas and certifications. At the same time companies can register on the platform as well and input information on the projects they need workers for and specify the strict education and diplomas that are needed (e.g. for scaffolding or insulation). In order to maintain quality and offer a different value from the competitors, the information on the platform will not be made public. Instead it is a means for FridayEuroTech to acquire information and use this information to accommodate to needs of customers while staying personal.

Why it’s possible
The main difference between the old and new application process is that information can be transferred instantly, and there is no waiting time between giving and receiving information, because data will be transmitted digitally. For the development of the platform a third party should be approached for converting the current website. This will be the costliest part of the project. The technology that will be used for the platform has already been used by other recruitment agencies that offer internet recruitment. This tool is becoming more and more popular and more agencies have expanded their business online and it has even led to agencies that are online based only. This means that the technology is available and that it should be easily feasible for FridayEuroTech. will not be a problem to implement the technology since it is already available and widely used by other companies. It will require investments and maintenance, but this is also not something that would cause problems for the company, which means the platform is operationally feasible.

Team 33.

DTP: Introducing B2B e-commerce

Big companies have accomplished their size by being good and performing better. The tube group is one of those companies. This trading company operates on a global scale, having twenty operating facilities all over the world. The assortment offers over tens of thousands of different products and has hundreds of thousands tons of products in stock. With such bulk at your service, it can be assumed that this is they have figured out the perfect way of handling, checking and keeping track of these products. But also how to get it to the client, both in sales as well as transport. However there are still challenges. In terms of handling the stock, a solid ERP system is required. The desire was to have all operating companies use the same SAP system. However during the implementation this went wrong. So eventually only four used this ERP system, the rest of the operating companies work with tailor made BusinessOne modules.

Another point of improvement it the communication towards the client in terms of e-commerce. Both IT problems and both in need for an IT solution.

So to gain insight into the current situation first a semi-structured interview was conducted, later adding more quantitative data from the annual report. The findings were analyzed for similarities and differences across cases and in comparison to theory.

Based on the research the recommendations that we proposed is, firstly, the implementation of the click-and-mortar B2B e-commerce model. Online channels through which the customer can interact with the company have to be developed. When implemented it will allow for a multi-channel strategy.

For example, it will enable the sales and marketing department to gain insight on customer buying behavior. It will make the ordering process more efficient and pleasant for both the customer and the sales agent. Also, it provides a platform for knowledge sharing within the company and the reduction of operational costs. It will not replace the current model but it will be an enhancement with great impact. An important condition for success of the e-commerce model is creating one standardized ERP system, because without that the e-commerce channel can’t be implemented on the scale The tube group desires it.

So independ on the size of the company, the stock or how long you already exist as a company, there is always room for improvement. Using the knowledge and new insights there is, especially in this recent field called IT, can provide solutions for previous companies struggles.

Group 18

Digital Transformation Project team 46: Amphenol – Creating a platform to connect the world

For the Digital Transformation Project we looked at the current business and its use of IT of Amphenol Houten. This organization is a business unit of Amphenol Global, a major producer of electric connecting applications as USB and HDMI ports. Amphenol Houten is the link between its manufacturing partners and its customers.

Based on open interviews with business executives of the company, in combination with critically reviewing existing literature, the authors extensively analysed the current business model of Amphenol Houten in its current competitive environment as well as current technology driven business trends.

 Key findings – Amphenol Houten distinguishes two customer categories; big OEMs and small OEMs (including distributors that provide access to other, often even smaller OEMs), both representing different needs that requires different approaches. The big OEMs demand extensive coordination as their specific needs concern high complexity and very asset specific products. Profit margins are low, but large quantities are worth the investment to build long-term relationships. Small OEMs confiscate too much valuable time of the (sales) employees of Amphenol that should be assigned to the bigger OEMs, while the product concern lower complexity and more commodity characteristics. Large margins on low quantities make them valuable clients, but a big risk is that due to the characteristics of a market (rather than the current hierarchy) structure and –attractiveness, distributors that can go directly to manufactures eliminating Amphenol Houten as intermediary between them and the manufacturers. Another important finding was that Amphenol Houten follows an inconsistent IT strategy that flows from its business strategy. The organization has a reactive IT strategy for big OEMs following their requests with an overlapping overall strategy. The organization does not have an IT strategy for improving the information flow to smaller customers, this is because it does not think there is profit to improve things per customer but the organization is not seeing the potential for an overlapping IT strategy to improve their services to the smaller customers.

Main recommendation – Amphenol Houten needs to proactively start with the development and the implementation of an online platform that serves as a more automated intermediary between the suppliers and buyers of connectors. This platform should address the business needs stated, which are a more efficient sales process, a more consistent information and IT strategy and the need to defend against disintermediation. To optimally address this needs the authors advise the platform to be transparent, exploit same-side and cross-sides network effects, enable a high level of standardization, and use a reversed auction for pricing. This platform is shown underneath:

Platform Amphenol

Maxime van Egdom (409346me)
Koen Hut (416751kh)
Siebe Kylstra (412656sk)
Geert Kriek (440801gk)
Stefan van Winden (421142sw)

References:
Amphenol. (2014). 2014 ANNUAL REPORT AMPHENOL.
Eisenmann, T. R., Eisenmann, T. R., Parker, G., Alstyne, M. Van, & Eisenmann, T. (2008). Opening Platforms : How , When and Why ?
King, S. P. (2013). Two Sided Markets. The Australian Economic Review, 46(2), 247–258.
Malone, T. W., Yates, J., & Benjamin, R. I. (1987). Electronic Markets and, 30(6), 484–497.
Porter, M. E. (2003). Strategy and the internet. Harvard Business Review, March, 63–78.

Startup on flight tickets

Why did this topic capture my attention?

While I was going through Forbes.ru, an article about flight and airline tickets business came to my attention. I was particularly interested in this topic, as I had no idea on how this B2C (ecommerce) industry works. The following blog post will be dedicated to a brief description of how a company can become an intermediary between airline corporations and end consumers, followed by a success story of a
Russian flight tickets startup that found a way to stand out among its world class competitors with deep pockets.airline-tix_3055215b

How flight tickets industry works?

In order to become a distributor of flight tickets, companies have to go through a number of consequent steps. First of all, they need to attain membership of International Air Transport Association (IATA), which is a trade association representing and serving the airline industry worldwide. As the next step, companies have to join the global distribution system of flight tickets (e.g. Galileo or Amadeus), and develop a software assisting customers with selection of the optimal flight. After accepting credit card payment, companies have to send customers e-tickets and receive the negotiated commission from each ticket sale.
However, despite relative simplicity of entering this business, flight tickets distributors face a big challenge: how can they attract customers to buy from them? Cheap prices is not an option, as distributors, by definition, represent an intermediary between airline companies and end consumers, and often cannot sell flight tickets cheaper than the airline companies themselves.
The following section provides an overview of OneTwoTrip, a Russian flight tickets distributor that found a new way of providing value to its customers.

OneTwoTrip
main_1-650x350The company was created in 2011 by a Russian entrepreneur Peter Kutis. After three months of existence, OneTwoTrip had 30,000 unique customers per month. These customers purchased on average 100 flight tickets per day, for an average price of $400 per ticket. OneTwoTrip charged 3-4% commission fees from each sale, resulting in monthly revenue of 100 * 31 * $400 * 0.04 = $49,600 (Forbes, 2011). Impressive results for a newcomer!

How is OneTwoTrip different from competitors?

OneTwoTrip decided to use the differentiation (rather than cost) strategy, an “approach under which a firm aims to develop and market unique products for different customer segments”. The company provides its customers with unique flight ratings varying on 1-10 point scale and 1-5 stars scale. These ratings combine and reflect a number of valuable factors attributable to each flight, including: information on historical and expected flight delays, aircraft’s “age”, distance between seats, probability of flight cancellation, qualification of pilots, service quality in respective airports, managerial competence at airline companies performing the flight and other. There is a strong rationale behind inclusion of each of those factors in the rating. For example, flight delays often occur due to management’s inability to negotiate with a certain airport. Therefore, managerial competence is a valuable parameter in estimation of flight cancellation probability.
However, OneTwoTrip spends a decent amount of money (this information wasn’t disclosed) to get access to all of these information and keep it up to date. For example, in order to find out “age” of aircrafts performing the flight, OneTwoTrip hired a team of physicist who track pilots’ on-board communications (which is not secret, nor codified).

Learning points

Based on example of OneTwoTrip it is worth remembering that businesses can always find a way for successful development. OneTwoTrip analyzed what their competitors didn’t offer to the market and merely filled this gap with own services. How could they know that flight ratings are something customers might be looking for? Feedback is one of the key resources, which is unfortunately frequently ignored by companies. As a recommendation, I strongly suggest future managers to try understanding the true customers’ needs and bear in mind that an intelligent combination of knowledge and creativity often leads to astounding results.

References
IATA Organization, reviewed on 10/10/2015
http://www.iata.org/Pages/default.aspx

Forbes Russian, “Startap Na Aviabiletah”, reviewed on 11/10/2015
http://www.forbes.ru/svoi-biznes-column/startapy/71739-startap-na-aviabiletah

OneTwoTrip Russia, reviewed on 9/11/2015
https://www.onetwotrip.com/ru/about/

Business Disctionary, “Differentiation Strategy”, reviewed on 11/10/2015
http://www.businessdictionary.com/definition/differentiation-strategy.html

Aldi and the digital transformation

Our digital transformation report is directed towards the executive management of ALDI B.V. and the board of its parent company ALDI Nord GmbH & Co. KG. It contains a critical assessment of ALDI’s current strategies and position in the industry, with the intention of implementing a new digital strategy.

ALDI has a solid foothold in the discounted segment of the grocery industry, currently making minimal use of information systems such as online sales channels to reach consumers. Online retail is highly competitive, difficult to successfully navigate and setting up an online sales channel and the corresponding distribution can be very costly. Moreover, revenue gained through online sales is only a small portion of the total income for most firms in the industry. Very few competitors are heavily vested in online retail, Albert Heijn being one of the exceptions.

Nevertheless there are opportunities that ALDI can exploit through new information strategies. Current trends clearly show a growing demand from customers for online sales channels, with projections estimating 20-25% of all grocery sales being done online by 2030. Furthermore, customers are demanding a combination of online shopping and pick-up points. Additionally, customers tend to be more price sensitive resulting in online competition being mostly price-based.

Firms that adopt a suitable business model that incorporates the proper IT strategies in time might profit from this potential growth, while those that fail to adjust to the changing market dynamics will have a hard time catching up. ALDI currently has the opportunity to get in on the ground floor. No discount supermarket chain in the Netherlands has yet adopted an online sales channel in their business model, leaving a gap in the market that ALDI can fill.

Benefits for ALDI would not only include revenue gains, but also an early start in getting a feel for online sales and the distribution that comes with it. Knowledge gained early on may prove vital to stay competitive in the coming years as online retail grows and becomes more important.

The strategy most fitting for ALDI is the development of an online sales channel with pickup points at specified locations throughout the country for customer convenience. This allows ALDI to develop a more indepth relationship with its customers, develop appropriate distribution protocols by keeping all operations in-house with a delivery strategy that has been tested and proved successful in the Netherlands. Upon successful implementation of these changes in the business model, additional changes can be made to further enhance the online sales capabilities.

Online grocery retail is a market that still lacks major revenue generation when compared to offline and it is highly price-competitive. Nonetheless, it is growing with increasing speed and firms that wait too long with adjusting to these dynamics may well find themselves in trouble somewhere in the foreseeable future. ALDI has the opportunity to stay ahead of these changes, a chance that should not be wasted.

Reference:

Blei, V., et al., (2015), “Aldi the new online grocer- a digital transformation proposal towards e-grocery”