Essay Sample on The Company's Information Management System

What is the Description of the Company’s Information Management System?

The success or failure of any company solely relies on its ability to manage information. Because of wide area demand for product supplies, Starbucks operates using a transaction processing system TPS, that helps them in collecting, modifying and retrieving all their transaction records (Verzello & Reutter, 1982). The company also uses a decision-support system DSS that efficiently manages and analyzes the collected data by making comparison for its sales and giving accurate revenue decisions (Verzello & Reutter, 1982). Lastly, Starbucks utilizes executive support system, manly to convert the analyzed results into reports and billings (Verzello & Reutter, 1982).

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Besides, the organization has its web portal that improves privacy by ensuring that only the authorized individuals access the collected data (White & Moraschinelli, 2009). For example, the web portal is designed to offer two different levels of access: the first is for the employees and the other one to the corporate employees. The available analyzed reports and other training materials for the employees have facilitated a smooth flow of information in the company. The various information management systems at Starbucks, has helped it in selecting new suitable locations, where the target demographics are accessed straightforwardly.

Does the Company’s IMS Provide a Competitive Advantage?

Ideally, the ability of a company to manipulate its collected data for internal usage is a critical tool for gaining a competitive advantage in the market. Besides, the IMS found in Starbucks Company allows promotes quick information sharing between its employees and employers. "Information systems that support an interchange of skills and knowledge and information across the systems of an organization, improve its competencies, thus provides it with an exemplary competitive advantage” (Zhang & Lado, 2001, p. 150). Moreover, the fact that Starbucks uses a value-based pricing methodology in assessing their customers, makes it possible to analyze the data obtained from IMS and to measure the extent of customer's willingness to purchase their products. Typically, Zhang and Lado (2001) suggested that in an environment where a company can produce valuable products above their overall expenses, then possibilities are that a dramatic increment in the amount of revenue may be realized, a fact that generally boosts a firm’s competitive advantage.

Starbucks' use of a global logistics system has guaranteed them a unique insight concerning their supply chain. Studies indicate that Starbucks used to spend averagely high on the transportation expenses, before its establishment of this specific IMS (Zhang & Lado, 2001). However, by employing the use of the global logistics system, the company has reduced the total expenses because there are no longer transportation costs: it has also achieved more reliable deliveries, thus allowing customers to obtain their desired products at any time (Zhang & Lado, 2001).

How IMS Helps in the Coordination Between the Supply Chain Partners?

Starbucks is a multinational company, with an even distribution of supply chain partners in over six distinct continents. Besides, the organization has a total of nine distribution centers: five in the USA, two in European zones, and two located in Asia (Robinson & Malhotra, 2005). To promote intercommunication between these firms with significant geographical distance, Starbucks incorporated the use of a global logistics system besides TPS, DSS, and ESS (Robinson & Malhotra, 2005). The system is centralized enough within the elements of safety, delivery time intervals, expenses within the supply chain and overall company's savings that all offer an efficient evaluation of its supply chain partners.

How IMS Monitors Orders and Inventory Levels to Satisfy Its Customers?

The global logistics system has flexible automation, which can easily monitor the functionalities of the orders and inventory levels. The automation helps the organization to make adjustments whenever there is need depending on the set limits based on the objectives of Starbucks (Kulp et al., 2004). The system is a joy to the customers because it can always detect when the demand of a particular product is high, and provide recommendations for an increase in either production or stock refilling, to ensure that its availability is enhanced, based on the demands. Kulp et al. (2004) further suggested that TPS, DSS and ESS are also useful in the organization, specifically in tracking inventories and nature of the sale, for use by the management. The ability to monitor their orders helps them in scheduling to ensure that every customer is served at the right time, while following the levels of inventories, allows the managers to coordinate with its employees, in ensuring that the company does not run out of its stock for products in any time of consumers need. For this reason, the customers are more likely to remain loyal and satisfied throughout with the services offered by Starbucks.

Why is Managing Information More or Equally Important than Moving Products?

One of the most critical components in business is the ability of an organization to implement the use of an active IMS. Although moving products is essential, an absence of proper IMS guarantees a poorly-organized system for the flow of products. Furthermore, a company without an IMS would be missing the critical information concerning sales, inventories and customer relations. It is because, most of the organizational decisions are usually based on the information derived from the IMS. Conventionally, IMS is not only beneficial for the provision of information that is applicable in the management of company's daily operations but also acts to facilitate business operations in line with its mission and vision, thus promotes the success of a company

References

Kulp, S. C., Lee, H. L., & Ofek, E. (2004). Manufacturer benefits from information integration with retail customers. Management science, 50(4), 431-444. https://pubsonline.informs.org/doi/abs/10.1287/mnsc.1030.0182

Robinson, C. J., & Malhotra, M. K. (2005). Defining the concept of supply chain quality management and its relevance to academic and industrial practice. International Journal of Production Economics, 96(3), 315-337. https://www.sciencedirect.com/science/article/pii/S0925527304002944

Verzello, R. J., & Reutter, J. (1982). Data Processing: systems and concepts (No. 04; QA76, V4.). London: McGraw-Hill. https://pdfs.semanticscholar.org/cca1/bfd7478c10c951dc1d70a2254dd2046558ef.pdf

White, B., & Moraschinelli, E. (2009). The Pursuit of Sustainable Competitive Advantage: A Profile of the Starbucks Corporation. http://www.diva-portal.org/smash/record.jsf?pid=diva2:226642

Zhang, M. J., & Lado, A. A. (2001). Information systems and competitive advantage: a competency-based view. Technovation, 21(3), 147-156. https://www.sciencedirect.com/science/article/pii/S0166497200000304