OROMIA STATE UNIVERSITY

DEPARTMENT OF MASTER IN BUSINESS ADMINISTRATION

(MBA)
CENTER BISHOFTU
Course of Management Information System (MIS)

Case study Group Assignment: Group-C

R. N Name ID/No
01 Sintayehu Mekonin Bekele SGS/MBA/W/17/0321
02 Ashenafi Abebe Werku SGS/MBA/W/17/0303
03 Gosa Baharu Dadi SGS/MBA/W/17/0314
04 Mestawot Gebisa Hirpha SGS/MBA/W/17/0317

Ketema A. Gemeda (PhD, Associate Prof.)

November, 2024
Case Study: 1

HOW MUCH DO CREDIT CARD COMPANIES KNOW ABOUT YOU?

1. What competitive strategy are the credit card companies pursuing? How do information systems
support that strategy?

Credit card companies are pursuing a differentiation strategy by leveraging detailed customer data to
gain a competitive edge. They aim to identify risky customers, target profitable customers, and offer
personalized promotions to build loyalty and drive revenue.

Role of Information Systems:

 Data collection and categorization: Information systems collect and organize transaction data,
assigning codes to categorize purchases.

 Behavioral analysis: Advanced analytics and behavioral profiling systems are used to assess
spending patterns and predict customer creditworthiness or risks.

 Fraud detection: Algorithms analyze unusual transactions to flag potential fraud.

 Targeted marketing: Systems enable personalized promotions, such as rewards for frequent
purchases in specific categories.

2. What are the business benefits of analyzing customer purchase data and constructing behavioral
profiles?

 Risk mitigation: Credit card companies can identify high-risk customers and adjust their credit
limits or interest rates accordingly, reducing losses from defaults.

 Fraud prevention: They can detect unusual spending patterns and prevent fraudulent
transactions.

 Targeted marketing: Personalized offers based on customer preferences increase engagement

and spending.

 Customer segmentation: Companies can distinguish between reliable and risky customers,
tailoring services to different customer segments.
  Operational efficiency: Data analysis helps companies allocate resources effectively and
prioritize high-value customers.

3. Are these practices by credit card companies ethical? Are they an invasion of privacy? Why or
why not?

This question is subjective and depends on perspective:

Arguments for Ethical Practices:

 Risk management necessity: Credit card companies need to mitigate financial risks, which is a
legitimate business concern.

 Customer benefits: Targeted promotions and fraud detection provide real value to consumers.

 Transparency of terms: If companies disclose data usage in their terms and agreements, it might
not be considered unethical.

Arguments for Invasion of Privacy:

 Lack of informed consent: Many customers may not fully understand or agree with how their
data is being used.

 Profiling concerns: Constructing behavioral profiles can lead to biased decisions or unfair
treatment, such as denying credit based on indirect indicators like where customers shop.

 Potential misuse of data: Sensitive data might be used inappropriately, raising concerns about
overreach or discrimination.
Case study:2
Border States Industries Fuels Rapid Growth with ERP

1. What problems was Border States Industries encountering as it expanded? What management,
organization, and technology factors were responsible for these problems?
a) Problems Border States Industries (BSE) Encountered as It Expanded

 Legacy System Limitations: BSE's Rigel ERP system could not handle the growing complexity
of their business due to its outdated design tailored only for electrical wholesalers.
 Manual Processes: Inefficient manual tasks for credit card processing and SPA claims created
bottlenecks and delayed operations.
 Customization Challenges: Excessive customization of SAP software during initial
implementation delayed deployment and increased costs.
 Data Fragmentation: Before SAP, BSE struggled with inconsistent, siloed data managed on PC-
based software like Excel and Access.
 Inventory and Customer Demands: BSE required faster inventory turnover and more efficient
handling of customer orders.

b) Contributing Factors:

 Management: Heavy reliance on consultants led to over-customization instead of leveraging

SAP's standard best practices initially.
 Organization: Lack of alignment among different departments during the first ERP rollout.
 Technology: The old system and the customized SAP implementation were not fully tested in a
real production environment.

2. How easy was it to develop a solution using SAP ERP software? Explain your answer.

 Initially, not easy: The first implementation faced challenges due to:

o Excessive customizations to replicate old workflows.

o Delays in deployment and training.
o Lack of proper testing before going live.

 Later, it became easier: By 2004, BSE implemented SAP updates with minimal customization,
adhering to standard best practices, leading to smoother transitions and reduced costs.

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3. List and describe the benefits from the SAP software.

a) Operational Efficiency:

o Reduced transaction processing times by 63%.

o SPA rebate claims processing streamlined (cut from 15-30 days to 72 hours).
o Automation of 60% of accounts payable transactions.

b) Data and Reporting:

o Unified platform for company-wide data, eliminating fragmentation.

o Real-time access to business performance metrics for better decision-making.

c) Cost Savings:

o Reduced costs of warehousing (down 1%), delivery (down 0.5%), and total overhead
(down 1.5%).
o Annual savings of $3.3 million from 1998-2006.

d) Growth Support:

o Scaled to support new acquisitions (e.g., tracking 1.5 million items post-expansion).
o Added functionality for kits and materials management.

e) Customer Satisfaction:

o Improved service by automating orders, tracking, and enhancing inventory visibility.

4. How much did the new system solution transform the business? Explain your answer.

 Scale: Supported rapid growth (e.g., branch offices expanded by 24 states, inventory turnover
increased fourfold).
 Process Improvement: Automation of key business processes like credit approvals and SPA
claims.
 Strategic Flexibility: Enabled BSE to pivot towards e-commerce and online services to meet
modern customer demands.
 Financial Reporting: Improved speed and accuracy of financial close processes, allowing access
to real-time data.

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5. How successful was this solution for BSE? Identify and describe the metrics used to measure the
success of the solution.

Metrics:

 Cost Efficiency: $30 million savings from 1998-2006 (equivalent to 37% ROI).
 Time Savings: Reduced processing time for SPAs and rebates.
 Employee Productivity: Freed up resources for higher-value tasks, decreasing reliance on
manual labor.
 Growth Enablement: Seamlessly integrated new branches and acquisitions, handling increased
complexity.

Overall, Success:

Highly successful, with benefits far outweighing the initial cost overruns and challenges.

6. If you had been in charge of SAP’s ERP implementations, what would you have done
differently?

 Avoid Over-Customization: Use SAP’s best practices rather than modifying software to mimic
outdated processes.
 Thorough Testing: Ensure the ERP is tested in a production-like environment before
deployment.
 Phased Implementation: Roll out SAP modules incrementally to reduce disruptions.
 Training and Change Management: Focus on early and effective employee training to smooth
the transition.
 Stakeholder Involvement: Engage cross-functional teams actively to align goals and avoid
departmental silos.

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Case study:3
ZIMBRA ZOOMS AHEAD WITH ONEVIEW

1: Describe the steps in Zimbra’s sales process. How well did its old marketing automation system
support that process? What problems did it create? What was the business impact of these
problems?

Steps in Zimbra’s Sales Process:

1. Website Visitor Interaction: Zimbra attracts over 200,000 visitors weekly to its website.
2. Free Trial: Visitors are encouraged to sign up for a 60-day free trial of its software.
3. Lead Identification: Zimbra uses its website and Salesforce.com to track visitor activity and
gather lead information.
4. Lead Qualification: Sales representatives identify which trial users are most likely to upgrade to
paid versions by analyzing activity data.
5. Follow-Up: Sales reps reach out to promising leads via email and telephone to close sales.
Performance of the Old Marketing Automation System:
 The previous system, Eloqua, was too complex for Zimbra’s needs.
 It supported limited browser compatibility, working only with Internet Explorer, while most of
Zimbra's team used Firefox.
 The software required advanced coding skills to create conditional logic, demanding significant
time and expertise from administrators.
 The cost was high, even at the entry-level package, and Zimbra could only allocate it to a few
users.
Problems and Business Impact:
 The complexity and inefficiency of the system limited sales productivity.
 The sales team faced difficulties in distinguishing high-quality leads from unqualified ones,
overwhelming them with irrelevant prospects.
 Time spent managing the system detracted from core marketing efforts, reducing efficiency and
the close rate of sales.

2: List and describe Zimbra’s requirements for a new marketing software package. If you were
preparing the RFP for Zimbra’s new system, what questions would you ask?

Zimbra’s Requirements:

1. Web Visitor Tracking: Ability to monitor website activity and identify potential leads.

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 2. Simplified Management: A system that is easy to use and maintain without requiring advanced
technical skills or full-time administrators.
3. Targeted Marketing Automation: Tools to automate email communication and integrate
customer activity data seamlessly.
4. CRM Integration: Compatibility with Salesforce.com to align marketing and sales data.
5. Cost Efficiency: Flexible pricing models that scale with usage, such as pay-per-use options.

RFP Questions:

1. Does the system support integration with Salesforce.com?

2. What are the browser compatibility requirements?
3. How does the system simplify lead generation and segmentation processes?
4. Can the solution scale to accommodate increased user demand and multiple users
simultaneously?
5. What training and support resources are available?
6. Are there flexible pricing options for small teams or pay-as-you-use models?
7. What reporting capabilities does the software offer for analyzing campaign effectiveness?

Question 3: How did the new marketing system change the way Zimbra ran its business? How
successful was it?

Changes in Operations:

 Zimbra adopted LoopFuse OneView, a simpler and more targeted marketing automation solution.
 The system streamlined marketing processes such as lead generation, customer activity alerts, and
email marketing campaigns.
 It allowed integration with Salesforce.com, enhancing alignment between sales and marketing
teams.
 The pay-per-use model reduced costs and allowed Zimbra to deploy the system widely across its
sales team.

Impact and Success:

 Reduced time spent on managing and maintaining marketing systems by 50%.

 Significantly improved lead conversion rates, with qualified lead close rates rising from 10% to
15%.
 Enabled the sales team to focus on high-value leads and increase productivity.

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 Overall, the new system addressed Zimbra’s challenges effectively, leading to a resounding
improvement in operational efficiency and sales outcomes.

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Case study:4
WR GRACE CONSOLIDATES ITS GENERAL LEDGER SYSTEM
Here are the responses based on the provided case study:
1. Why did WR Grace’s general ledger system need an overhaul?
WR Grace's general ledger system required an overhaul due to the following reasons:
 Fragmentation and Redundancy: Grace used three separate ledgers for its legal reporting,
Grace Davison operations, and Grace Construction Products. These systems were disjointed, with
different configurations, levels of granularity, and redundant data.
 Inefficiency in Reporting: The fractured system created inefficiencies in compiling and
reconciling financial reports across subsidiaries and divisions. The process was time-consuming
and consumed excessive employee resources.
 Complexity and Lack of Standardization: The systems used varying methodologies (e.g.,
profit-center accounting vs. special-purpose ledgers) which made it difficult to consolidate data
effectively and uniformly.
 Global Operations: With operations in over 200 subsidiaries and 45 countries, a fragmented
ledger system hindered effective financial management and decision-making.

2. What made SAP a logical partner for Grace’s upgrade?

SAP was a logical partner for Grace’s general ledger upgrade due to:
 Proven Expertise: Grace already had a relationship with SAP, having implemented SAP software
in 1997 and using other SAP solutions like SAP Business Information Warehouse and NetWeaver
Portal globally.
 Integrated Solution: SAP General Ledger offered a comprehensive solution that could unify
Grace’s financial reporting into a single, standardized system across divisions and subsidiaries.
 Automation and Simultaneous Posting: SAP General Ledger provided features like automatic
posting to sub-ledger items, cost accounting areas, and financial reporting, which streamlined
operations.
 Scalability: SAP's ability to handle the consolidation of global operations and the flexibility to
meet Grace's unique financial needs made it a fitting choice.

3. What obstacles did SAP and Grace face in their attempts to consolidate Grace’s ledgers?
Key challenges included:
 Data Migration Complexity: Grace needed to collect, cleanse, and integrate data from three
separate ledger systems, removing redundancies while preserving accuracy.

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  System Configuration: Modifying the SAP General Ledger to meet Grace's unique needs
required extensive customization, unit testing, and validation to ensure functionality.
 Decommissioning Legacy Systems: Transitioning away from old ledgers involved identifying
and migrating critical reports while minimizing disruption to ongoing operations.
 Business Process Changes: Adopting the new system required reconfiguring Grace’s financial
processes to align with SAP's capabilities.
 Testing and Implementation: Rigorous testing (unit, scenario, and business process testing) was
essential to ensure the system performed as required without introducing errors.
 Time and Resource Constraints: Ensuring a smooth migration required significant investment
in time, personnel, and coordination between Grace’s teams and SAP consultants.

4. How successful was the general ledger migration?

The migration was highly successful:
 Efficient Consolidation: Grace achieved a unified, standardized financial reporting system,
eliminating redundancies and reducing the complexity of its financial processes.
 Improved Reporting: Managers and financial planners gained real-time access to critical
financial data, streamlining decision-making and reducing the time spent on data reconciliation.
 Cost Savings: Maintenance costs were significantly reduced by replacing multiple ledgers with a
single system, and IT expenses decreased.
 On-Time and Under Budget: The project was completed as planned, showcasing effective
project management and collaboration.

Risks of Adopting a Single General Ledger System:

1. Vendor Lock-In: Dependence on a single vendor (SAP) could limit flexibility and bargaining
power in the future.
2. System Downtime: Any issues with the centralized system could disrupt financial reporting
globally.
3. Cost of Upgrades: Future upgrades or changes to the SAP system might be expensive and
complex.
4. Data Security Risks: Consolidating all financial data into one system could increase the impact
of potential cyberattacks or data breaches.
5. Cultural Resistance: Employees across global operations might resist changes to standardized
processes, requiring extensive training and change management.

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