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INFOSYS.

110 BUSINESS SYSTEMS:
DELIVERABLE 2: BUSINESS SECTION
2014


Name Aisling Doyle
NetID adoy877
Group Number: 210
Website Link: http://infosysgroup210.blogspot.co.nz
Tutorial Details
Tutor: Day: Time:
Johnnie Shubert Wednesday 11am
Time Spent on
Assignment:
18
Word
Count:
2072






















Promotion of Physical Activity Through Free Transport Tickets


I ntroduction

In an age where technology has the ability to do everything for us, it seems we are becoming
increasingly sedentary. Our fitness levels are decreasing with a clear correlation to mental illness
emerging, and obesity is on the rise. In order to promote awareness and engagement in physical
activity, our business idea is to place ticket machines in bus and train stations that provide free
tickets in exchange for exercise. Using motion detecting technology, the machines will know when
the set amount of exercise has been reached and will print a ticket. Having a time limit of two
minutes to reach the requirement of either 20 squats, 30 lunges or 40 star jumps means that
participants will become more competitive, have more fun, and not have to queue for too long. The
machines will also be fitted with the ability to upload photos of customers participating to
Facebook, twitter, tumblr or Instagram, in the hope that the social media attention will promote
fitness even further. Our machines also offer a great alternative to customers who may not have the
money to buy a transport ticket.

3.1 Vision

To raise awareness of the importance of physical activity and encourage New Zealanders to
exercise by providing them with a fun, easy-to-use option that has the added impetus of a free
public transport ticket.











3.2 I ndustry Analysis

Industry: Not-for-profit sector

Force High/Low Justification
Buyer Power: Low As the first and, therefore ,only
product of its kind in the industry it
has a monopoly effect. Buyers who
are willing, or would prefer, to buy a
transport ticket than do exercise
would have a higher buyer power.
Buyers who would prefer to pay for
their ticket via a method other than
money, or would like to try
something less conventional and
more fun, only have our machines as
their alternative.
Supplier Power: High Being in a monopoly market
situation, means that to the suppliers
we are a monopsony, giving them a
high supplier power. As a not-for-
profit business we rely heavily on
funding from other companies,
organisations and private bodies.
Ultimately, anyone who is prepared
to fund our business has very high
power over our business as without
them we would not be able to proceed
or continue.
Threat of new entrants: Low
New entrants are most
commonly attracted by the
profitability of an industry and
consumer demand for the
product/service. As a not-for-
profit product/service that
requires funding without any
financial return, it is highly
unlikely that new businesses
would be interested in entering
our industry.
New entrants would also need to find
a source of funding for the start-up
costs and long term running and
operating of the machines.


Force High/Low Justification
Threat of substitutes: Low
Substitutes in the area of public
transport tickets would have to
offer other payment methods
such as singing rather than
exercising, or buying
something at a shop and
receiving a free ticket with the
purchase. As the purchasing of
transport tickets is a specific
market and there is little
demand for there to be
alternative methods of
obtaining the tickets, it is
unlikely there will be
substitutes.
The main threat to our
product/service would be in the
substitution of funding. If a new
businesses overtook our share of
funding, it would largely impact our
product/service.
Rivalry among existing competitors: Low Our product/service is currently the
only ‘free’ method of obtaining a
transport ticket, meaning there is no
rivalry. Our only competitor is the
normal transport ticket machines and
cards which use monetary payments.


Overall attractiveness of the industry: As most businesses aim to make a return on
investment, they would find it to be an unattractive industry as there is no profit to be made.
The most attractive aspect of this industry to businesses is the positive marketing that comes from
funding a not-for-profit business.

3.3 Customers and Their Needs

As our product/service is used to provide public transport tickets, our customer base is very
broad. The only customer discrimination is against those who may not be able to perform the
physical activities required. Our clients may be of any age or socio-economic form as there are
different exercise options to suit each customers mobility and there is no price barrier. Being of a
health and fitness nature, it is likely that our product/service will appeal more to those who are
interested in health and fitness, however, many members of the public who would like to try


something different, don’t want to pay for a train ticket, or think it looks like fun, would also find it
appealing. Our customers needs are very clear; they want a public transport ticket.

3.4 The Product and Service

Our product fulfills the customers’ needs by printing a public transport ticket in exchange
for exercise, rather them having to pay for it with money. With three options of exercise to choose
from, we ensure that all customers will find an action they are comfortable with and able to
perform. With the use of motion-detecting technology the ticket machine will know when the
required activity has been met and will print the ticket. Keeping a low number of exercises needed
and a time limit means that customers won’t take too long to complete the task, and the next
customer in line can have their turn.

3.5 Suppliers and Partners

Our product/service is designed with the idea that it is partnered with Nintendo and the New
Zealand Transport Agency. The partnership with Nintendo would be based on the use of their Wii
Fit technology in developing our product. By using their technology to develop a not-for-profit
product that is useful to the community and promotes health and fitness, it is anticipated that they
would be willing to fund the project, as the positive marketing behind it would benefit them greatly.
The New Zealand Transport Agency would have to be a partner with us in order for the machines to
be able to print transport tickets and to be placed in the various transport stations. As our product
does not require many resources we will not need many suppliers. The start up manufacturing
would be outsourced, and the only ongoing supplies would be ink and paper for the tickets, which
the New Zealand Transport Agency would already have a supplier for.

3.6 Strategy

Although out business is not-for-profit, the strategy used in its development may still be
similar to that of a profitable business. With the use of SWOT as our strategy, we will be able to
weigh up our variables, permitting us to generate plans to combat any issues we may for-see.
Using SWOT analysis we can identify these characteristics;






Strengths
- Our product/service is easy to use
- Our product/service is beneficial to the community and is healthy
- Our product/service is unique
- Our product has a competitive advantage
- The use of social media broadens our ability to reach customers
- The use of social media makes it a more personal experience
- Our product is free for customers to use

Weaknesses
- Funding may be hard to find and/or maintain
- There is a limited choice of exercises
- The New Zealand Travel Agency have a large bearing on how our business will run
e.g. location of machines, number of machines, ticket sales

Opportunity
- We can add more exercise options if needed
- If popularity increases, more companies may want to partner with us and fund us
- Companies may want to adapt our machines for uses other than public transport
- Social media provides free advertising to a wide, varied audience

Threats
- An economic downturn could mean funding is reduced or cut completely
- Other businesses may try to copy or adapt our idea as their own business
- Other businesses may steal our funding

PEST analysis is also a useful strategy for our business as many of our business factors fall into the
categories. Using PEST would give us a more in-depth understanding of these factors and how they
can be utilised to our benefit. PEST illustrates the following;







Political
- Promoting a healthy lifestyle and fitness is constantly on the political agenda
(could lead to government funding)
- Supports the use of public transport
- Provides an option for those who cannot afford to catch public transport

Economic
- Funding relies heavily on the current state and stability of the economy
- High start up cost
- Low ongoing and maintenance costs

Social
- Use of social media makes our business more personable and accessible
- Encouraging fitness and health is positive for the community
- Media and public view health focused businesses as ‘good’

Technological
- Being technologically astute allows us to keep up to date with new social media
aspects that may improve our business.
- Using the technology already crafted by Nintendo will save a lot of development
time and enable us to focus on other aspects.
- Having a social media customer interface allows for customers to interact and
communicate more easily, as well as providing numerous opportunities in the
future.

Our business will be running under Cost Leadership (Low cost, broad market) but with low cost
being more like no cost.










3.7 Value Chain Activity: Promotion of Fitness and Physical Activity

The most important value chain activity for our business is the promotion of fitness and
physical activity. While the basic, face function of our product/service is to provide an alternative to
paying for public transport, its main purpose and the origin of the idea was to promote physical
activity and to find a method of encouraging people to exercise in a way that is fun, competitive and
benefits them in a more materialistic way than just ‘being fit’. Promoting participation as a fun,
competitive exercise that can be uploaded onto social media means that I wider audience will view
our product/service and will be more inclined to take part. Our hope is that these people will then
realise how enjoyable and fun exercise can be, encouraging them to become more physically active
in their own time and therefore improve their health and productivity. The funding and partnership
for our product/service is based on its exercise intention, and the overall purpose for it is to raise
awareness for fitness, meaning the value chain activity of promoting fitness and physically activity
is the most important. If we can successfully promote fitness and physical activity then we can
consider our business to be successful.

3.8 Business Processes

3.8.1. Uploading of photos onto social media
The ability for customers to upload images of them using our product/service is a vital
business process in the value chain mentioned above as it provides access and advertisement to a
wider audience and allows our customers to interact with our product/service on a more personal
level. Having this capability in our machine appeals more to the younger generations who use social
media as a basic foundation for communication and daily life. Having customers upload their
photos will be a fantastic source of advertisement and will encourage more people to take part so
that they can upload their photos too. Ultimately, the process of uploading photos to social media
will allow us to reach a wider customer base, will allow a more personal level of interaction, and
will draw in more customers. This will ensure our business is successful in promoting fitness and
physical activity.







Start
Photos taken of customer
while exercising and using
machine
Customer selects and
edits the photo the
want to use
Customer decides which
social media site they
would like the photo
uploaded to
Photo is uploaded
Friends on social
media site see the
photo(s)
Physical activity has
been promoted
End
Friends interested in
trying the machine too




3.8.2. Creation and retention of customers
Creating customer loyalty is another vital business process to the value chain. For our
business to succeed it is extremely important that we are able to build a loyal customer base who
will continue to use our product/service and will tell their friends about it too. As we will be
operating in a market that sees a majority of the customers being the same people each day, it is
crucial that we please the customers so that they continue to use our machine in the future. Without
these regular customers we will have very little business if we are relying on one-off travellers.
Potential customers who may have been apprehensive may be convinced to try our machine by
satisfied customers talking about their positive experience. If we are able to draw in these
customers, retain them and increase them, then we our ability to promote fitness and physical
activity will increase to an astounding degree.











Start
Exercise option is
chosen by customer
Exercise is performed
by customer
Customer enjoys
using the machine
Customer collects
free transport ticket
Physical activity has
been promoted
End
Customer tells other possible
customers of their positive
experience
Customer would like to
use machine again, or
exercise at home



3.9 Functionalities

3.9.1. Social Media
- To take photos
- To upload photos to social media sites

3.9.2. Customer Satisfaction
- To print transport tickets
- To count the number of exercises

3.10 Systems

3.10.1. Social Media System (SMS)
Our Social Media System is the system that enables our customers to choose which social
media site they would like to upload to. The SMS will support the use of Facebook, Instagram,
Tumblr and Twitter. This will allow customers to upload their images as they wish, on a secure
network, and will log them out after to protect their privacy. The SMS will provide our customers
with access to their preferred social media site in an easy-to-use manner.

3.10.2. Exercise Recognition System (ERS)
ERS is the system that activates and uses the motion detecting technology to count how
many exercises have been performed by our customers. By taking count of the exercises it will tell
customers when they have completed the task and will then prompt the ticket printer to print the
ticket.

3.10.3. Photo Editing System (PES)
Our PES is the system our customers use when selecting which photos they would like to
upload. They will have the option of editing their photos (cropping, boarders, filters, text). Allowing
customers the chance to add a personal touch to their photos will make them feel more valued and
will particularly appeal to the younger generation who will feel that the use of our product and
exercise can be a part of their online social life.





3.11 Summary Table: Value Chain to Systems


Value Chain
Activity
Process Functionalities Specific Information
Systems
Broad Information
Systems
Promotion of
Fitness and Physical
Activity
Uploading of photos
onto social media
-
To take photos

-
To upload photos
to social media
sites

Social Media
System

Photo Editing System
Content
Management
System (CMS)

Customer
Relationship
Management (CRM)
Creation and
retention of
customers
-
To print transport
tickets

-
To count the
number of
exercises

Exercise
Recognition
System

Social Media System
Supply Chain
Management
(SCM)

Enterprise Resource
Planning (ERP)






















Conclusion

In conclusion of this report, we can depict that our business operates in a not-for-profit
industry and therefore relies heavily on the funding from willing bodies. Our reliance on these
funding partners will be the most subservient at the beginning of the setup when resource costs are
at their highest. However, the ongoing costs of our business will be minimal, allowing the main
focus to be moved to the satisfaction and retention of customers. This customer base will enable us
to use social media as a way of promoting physical activity as fun, accessible and sociable. As
social media has a strong marketing ability, it is likely that more businesses would be interested in
funding us for the purpose of their own free marketing. The use of our Social Media System and
Photo Editing System will ensure customers feel cared for and that our machine has a more personal
interaction with there lives. Overall, with the implementation of the business factors discussed in
this report, our business should be able to run and operate triumphantly whilst remaining faithful its
vision.























References

Greechie, S. SWOT Analysis of a Nonprofit Organization. (n.d.). Retrieved May 23, 2014, from
http://smallbusiness.chron.com/swot-analysis-nonprofit-organization-4407.html

Handfield, R. (2011, January 11). What is Supply Chain Management?. Retrieved from the North Carolina
State University, Poole College of Management SCRC website: http://scm.ncsu.edu/scm-
articles/article/what-is-supply-chain-management

Jurevicius, O. (2013, February 13). PEST & PESTEL Analysis. Strategic Management Insight. Retrieved
from http://www.strategicmanagementinsight.com/tools/pest-pestel-analysis.html

Sheehan, R. M. (2005, November 18). What is Nonprofit Strategy. Retrieved from
http://www.nationalcne.org/index.cfm?fuseaction=feature.display&feature_id=137

Simply Strategic Planning. Strategic Planning Non Profit. (n.d.). Retrieved May 23, 2014, from
http://www.simply-strategic-planning.com/strategic-planning-non-profit.html

QuickMBA. Porter’s Five Forces. (n.d.). Retrieved May 20, 2014, from
http://www.quickmba.com/strategy/porter.shtml