Information Technology Reference
In-Depth Information
The Department of Education and Training for Victoria, Australia, chose three primary
suppliers for desktop computers to be used in Victorian government schools. Staff can pur-
chase products directly from these preferred suppliers with no need for requesting separate
price quotes because the terms of purchase have already been negotiated. Staff need only to
download negotiated price lists from a Web site and complete online purchase orders to order
equipment. This process ensures competitive pricing from financially viable providers who
have agreed to provide three-year, on-site warranty of equipment evaluated to be technically
cost effective. It also eliminates days or weeks of delay in completing necessary paperwork
and obtaining approvals.
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Product and Service Delivery
Electronic distribution can be used to download software, music, pictures, video, and written
material through the Internet faster and for less expense than shipping the items via a package
delivery service. Most products cannot be delivered over the Internet, so they are delivered
in a variety of other ways: overnight carrier, regular mail service, truck, or rail. In some cases,
the customer might elect to drive to the supplier and pick up the product.
Many manufacturers and retailers have outsourced the physical logistics of delivering
merchandise to cybershoppers—the storing, packing, shipping, and tracking of products. To
provide this service, DHL, Federal Express, United Parcel Service, and other delivery firms
have developed software tools and interfaces that directly link customer ordering, manufac-
turing, and inventory systems with their own system of highly automated warehouses,
call centers, and worldwide shipping networks. The goal is to make the transfer of all infor-
mation and inventory—from the manufacturer to the delivery firm to the consumer—fast
and simple.
For example, when a customer orders a printer at the Hewlett-Packard (HP) Web site,
that order actually goes to FedEx, which stocks all the products that HP sells online at a
dedicated e-distribution facility in Memphis, Tennessee, a major FedEx shipping hub. FedEx
ships the order, which triggers an e-mail notification to the customer that the printer is on
its way and an inventory notice to HP that the FedEx warehouse now has one less printer in
stock (see Figure 8.2). For product returns, HP enters return information into its own system,
which is linked to FedEx. This signals a FedEx courier to pick up the unwanted item at the
customer's house or business. Customers don't need to fill out shipping labels or package the
item. Instead, the FedEx courier uses information transmitted over the Internet to a computer
in his truck to print a label from a portable printer attached to his belt. FedEx has control of
the return, and HP can monitor its progress from start to finish.
Figure 8.2
Product and Information Flow
for HP Printers Ordered over the
Web
Order
Hewlett-Packard
Shipment
notification
Shipment
notification
Order
Order
Customer
Shipment
notification
FedEx distribution
facility
Product
delivery
FedEx
Product
delivery
After-Sales Service
In addition to capturing the information to complete the order, comprehensive customer
information is captured from the order and stored in the supplier's customer database. This
information can include customer name, address, telephone numbers, contact person, credit
