Chapter 3-Minicase 1 (page109)
7-Eleven Japan: Giving Customers a Voice
1. 7-Eleven competes both with other chains of convenience stores and independent stores. What competitive advantages can you identify in this case?
Top quality of food, freshness, 100% product availability obtained by implanting a system of frequent and thus often small-lot deliveries.
Value added services such as home delivery, and new products such as fast food, have also been introduced.
2. Which of the five forces of Porter are countered by the 7-Eleven systems?
· Suppliers: they are involved and share their information with them, they help the stores sell more. If a product does not sell well it is discontinued. Then new products are introduced - the substitute force at work.
· New entrants are always a threat, but by listening to what the customer wants new entrants can be deflected. Because 7-Eleven is always trying to change and improve, they have a promising future.
· The buyers are being informed of customer needs. Thus, they have less power and have to listen every time a product is not purchased by customers. If they have the capability of rapid change they can become a leader.
3. Which strategies of those suggested in the various frameworks are noticeable in this case?
Long Range Planning: no company should invest $200 million in an Information System if it is not planning on obtaining bigger advantages from it in the future. Response Management because by using IT they can respond to different market needs fast. Innovation because they have come up with policies - like changing the product display of the store twice a day - to accommodate customer needs.
4. Which of the business pressures discussed in Chapter 1 are evidenced in this case?
· Technology is one - they are not obsolete in the eyes of customers. They handle the information overload created by themselves well.
· Social pressures: the culture and the economy. The Japanese culture is different from the American profit oriented culture. 7-Eleven has become Japanese and profitable.
· Market pressure: other world class companies are aiming at the market.
5. Which of the corporate response activities of Chapter 1 are evidenced in this case?
· Strategic Response: the data is gathered and analyzed by the company to develop better strategies and improve the operation for all stakeholders.
· Continuous Improvement Efforts: they reward high achievers. This helps to develop new ways of doing things better.
· Business Process Reengineering: the company developed a new way of doing the business, from ordering to selling the product . It generated greater sales.
6. Is the system infringing on the customer's privacy? Why or why not?
The data gathering is done in a way that the customer does not feel intimidated or harassed because they do not ask for the data. Instead they just observe the gender and the age without the customer telling them. Customers do not need to disclose more than what is necessary for a successful and satisfying transaction.