News 12 - Cable vs. Telco

1. We presented our proposals on how to help Time Warner Cable company retain and gain customers this week through some technical/management solutions. I think that it is timely that we are discussing this subject as the battle between cable and telecom companies as video and voice services are being integrated and provided to customers through one company. We (Team C) discussed integration of digital video/tv, voice, and data service through internet and one physical hardware and the integrated video on demand service while Team D explored the possibility of using fiberoptic technology and the providing of internet TV services.

2. http://www.businessweek.com/investor/content/oct2007/pi20071010_242433.htm?chan=search

3. I think this article sums up the competitive situation of the cable and telecom companies very well. Each is integrating into their companies the services traditionally provided by the other. Cable have implemented and increased their voice services and video services, whereas telecommunications companies are becoming less dependent on wired-line phone business and offering more on wireless and DSL and video service. Companies such as Verizon are investing in FIOS technology in order to compete with cable companies on video and other services that require high bandwidth. I think the article would be more complete if it were to propose the use of different emerging technologies in the future and estimate how this will affect the companies financially, similar to what we have been doing in class.

News 11 - Zagat Survey on Physicians

1. This week, groups G and H discussed United Health Group issues and solutions. The problems are in the physician rating system and the claims payment procedure. The insurance companies are focused mainly on cost associated with physician services with insufficient emphasis on quality.

2. Attached is a commentary on the Zagat Survey for Physicians:
http://www.healthbeatblog.org/2007/10/the-pitfalls-of.html

3. The article comments on dangers of rating physicians the same way as restaurants are rated.The author suggests a comparable experience, "It’s a bit like having car ratings only address color scheme and seat comfort: these are nice facts to know, but at the end of the day you want a car that you can rely on, a consistent performer that does its job and does it well."

I agree that the criteria on which physicians are rated in the Zagat survey is too superficial to be of significant value. Though the survey provides insight on what to expect in terms of customer service from a particular physician, it does not provide valuable information on other aspects that define the competency of a physician. Perhaps, Zagat could add value to the survey by supplementing that information with opinion and ratings supplied from an independent physician rating organization.

Indiv 4 - Information Aggregation Through Electronic Market

Suggest two other business cases in which this method can be used to collect information. What problems do you see besides the ones mentioned in the Background information section? What kind of information system do you need to design to support this method of collecting information? Provide a simple hardware/software configuration.

1. There are two other types of business that might use the information aggregation method. An international freight forwarding company needs to collect information to predict the currency exchange rate. International trades are highly influenced by currency exchange rates. For example, if the exchange rate between US dollars to Canadian dollars decreases, US import from Canada will also decrease, but US export to Canada will increase. Therefore, international freight forwarders need to predict the rate for their business planning. They can use this method to collect currency rate prediction from the currency trading brokers.
The airline industry can also benefit from this method by collecting information to predict the future fuel price. Airlines need to sell tickets for flights in the future. Since fuel price fluctuates, the ticket price should also be adjusted. Airlines should collect information from the electronic market, and predict the future fuel price.

2. There are problems in this method besides the ones mentioned in the background information section. First of all, this method does not prevent or consider sudden catastrophic events that might suddenly crash the market. Second of all, each participant has its own predication on the market, but sometimes, it is only their personal beliefs. Even though the majority of participants might prefer one result in the market, but it is not a systematic analysis. Therefore, it might not be reliable.

3. An online trading system is a good enough for this practice. The company can setup a web server. It should contain account information of each participant, and allows them to trade on this electronic market on the website. Participants can trade on currency, fuel, or stocks depending on the company’s objective.

News 10 - OpenSocial

1. In class, I learned that social networking sites contain applications such as games and virtual libraries. I also learned that Google is trying to get social networking websites together to use a common platform for developing these applications. I was wondering what kind of advantages and disadvantages this would have.

2. Related article: http://www.techcrunch.com/2007/10/30/details-revealed-google-opensocial-to-be-common-apis-for-building-social-apps/

3. The article is about Google's launch of a standardized platform for developing applications for social networking websites, called OpenSocial. It features many participants, called hosts, that feature user data and content. Developers then use this standard to create software for the social networking sites. To my surprise, many hosts, such as MySpace, Friendster, LinkedIn, have already agreed to this. The OpenSocial platform promises to make more varied types of applications compatible with all host social networking site, making distribution easier for developers of software applications. I agree with the author that the success of this new OpenSocial platform would make life easier for software developers. Traditionally different websites use different programming languages, and the developers need to use the same language that the websites use. Now OpenSocial can provide the connection between the developers' application program to the social websites. The developers can use any computer language for thier application, and they will be able to access the data from the social websites through OpenSocial. Therefore, OpenSocial enriches the users of these websites by making more variety of applications available to them.

News 9 - AT&T Will Bid in Wireless Auction

1. I learned this week of various types of auctions. For example, the English clock auction is one in which the beginning price is set by the seller and then the price increases by a certain increment. At each increment, all participating bidders are asked to decide whether to stay in the auction or to drop out. The last bidder who does not drop out is the winner of the auction and pays the price at which he or she wins the auction.

Another type of auction is the Dutch clock auction. The high price is set by the seller. The offer price then decreases at fixed amounts until the first bidder to take the offered price and agrees to buy the item.

2. AT&T will bid for more wireless spectrum:
http://www.pcworld.com/businesscenter/article/138687/att_will_bid_in_wireless_auction.html

3. In the article, the author discusses AT&T uncertainty of whether it should bid for wireless spectrum on the 700 MHz band due to complex conditions of sale set by the FCC. The FCC requires the winning bidder to open access to all wireless devices for certain bands of spectrum.

Many believe that there will be much competition in the auction for parts of the wireless spectrum capable of providing high speed data service. According to recent news, prices offered to buy spectrum are at record highs. In addition to telecom companies, internet companies such as Google are trying to enter the scene, as well as Apple, a computer and multimedia company.

In my opinion, AT&T probably has already made a decision regarding acquisition of more of the coveted spectrum. I believe that it is possible that they are purposely keeping bidding information discreet because it is advantageous for bidders to reveal as little information as possible to other bidders prior to bidding for an item to increase their chances of winning in this type of auction.

Indiv 3 - Walmart's and Dell's Successful Strategy

Dell and Walmart's advantage over their competition is not due to technology, it's due to management. Do you agree? How does your answer relate to some of the problems that these companies have had recently?

I agree that Dell's and Walmart’s advantage over their competition is not due to technology, but due to management. Their success is not coming from advanced technology.

For nearly five decades, Wal-Mart's has provided low-priced products to its customers. Wal-Mart does not have any special advantage in technology. Wal-Mart stores operate according to their "Everyday Low Price" philosophy. It mainly has advantage over its competitors because it has been better at containing its costs.

Dell is in a similar situation as Wal-Mart. Dell makes low-end computers, and does not use particularly advanced technology in comparison to its peers. Dell’s success lies mostly in its supply chain management, which enables the company to lower down its cost.

However, recently both companies have been experiencing problems because they have been sacrificing product quality in order to achieve lower costs. Walmart forces its suppliers to compete with each other to reduce their wholesale prices. The supplier then will turn back the loss to the manufacturer, which results in bad product quality. Eventually, this will affect consumers’ confidence on Walmart’s products.

Dell is facing the same problem. Outsourcing customer service and producing products overseas is causing a loss in confidence in their products and services.

News 8 - P&G Supply Chain Management Solution

1. Supply Chain Management is the combination of strategy and technology that helps a business find raw materials that they need to produce their products or services. It involves systems which control and communicate with suppliers, vendors, warehouses, transportation parties and customers. Some examples of supply chain management software include EDI system, online tracing and inventory system. Many 3rd party logistics companies are also providing supply chain solutions for other businesses. Two such companies are UPS supply chain solution and Fedex Trade Networks.

2. I found a recent news article related to Supply Chain Management
http://www.scmr.com/article/CA6494820.html?industryid=48314

3. The article is about Proctor & Gamble’s decsion to choose Optiant software to help implement its new supply chain strategy. The Optiant SCM software will help P&G deliver their products to customers in the most efficient manner. In order to fulfill its inventory planning and optimization goals, P&G is looking forward to expanding the partnership with Optiant.

I agreed with P&G’s business idea because a good SCM provides optimal coummication and control over vendor, customers, warehouse and transporation. Instead of spending money to develop its own SCM software, it is better to outsource the SCM to a professional supply chain solution company, such as Optiant, because they are more experienced in this area. This will allow P&G to focus on the bigger picture of their business. In the new age, businesses will be able to receive or make orders, ship products, check inventories, pay vendors and bill customers through the SCM system without the need to step out of the office or make any paper transactions.