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INFOSYS.110 BUSINESS SYSTEMS:
DELIVERABLE 2: BUSINESS SECTION
2014

Name Jason Kang
NetID jkan807
Group Number: 348
Website Link: http://infosys1102014fcgroup348.blogspot.co.nz/
Tutorial Details
Tutor: Day: Time:
Mira Lee Friday 12pm
Time Spent on
Assignment:
15 hours Word Count: 1470

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ALFY - THE ALTERNATIVE WALLET
INTRODUCTION
New Zealanders are heavily limited when it comes to making transactions and because
these typical methods for payment requires a wallet, it would be extremely convenient if
the wallet becomes unavailable. Alfy plans to fix this problem by introducing New
Zealanders to a phone app which allows direct and simple payment through any
smartphone.
3. BUSINESS SECTION
3.1 Vision
Providing New Zealand with the most swift, secure, and innovative technologies for the
everyday consumer.
3.2 Industry Analysis: Mobile Payment Industry
Industry: Mobile payment industry.
Force: High/Low: Justification:
Buyer power: High Several companies are quickly getting into the
mobile payment industry. Companies such as
Square, Apple and Google that are paving the way
for this industry (Bruce Rogers, (2014)). Because
of the relatively plentiful options that are
available to customers, buyer power is high.
Supplier power: Low The main suppliers for this indrustry would be
telecommunications companies. These suppliers
will be used to maintain the company
infrastructure. There are currently 18 telecom

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companies in New Zealand on the IndexNZ (n.d.)
database. The number of companies in this
industry is substantially less than the number of
suppliers available, so supplier power would be
low.
Threat of new entrants: High Because this is primarily a software-based
industry, investment capital would be relatively
low and so there is a low entry barrier for this
industry. Therefore, the threat of new entrants
would be low.
Threat of substitutes: High Substitutes for mobile payment are card and cash
payments. The threat of these substitutes are
high, as buyer propensity to switch to mobile
payment is low because the current methods for
payment have been in use for a very long time.
Cash has always been used, and, as shown in a
document of the history of the card payments
system (MasterCard, n.d.), cards have been in use
since 1946.
Rivalry among existing
competitors:
High Rivalry in the mobile is quickly growing and it is
reported that by 2018 mobile wallets will be used
in 1 in 5 handsets (BiztechAfrica, 2014). Because
the increasingly fierce competition amongst
existing competitors, the rivalry in this industry
would be considered high.
Overall attractiveness of the industry: There is stiff competition in this industry and it will
be difficult to movie customers from traditional payment methods. Though the supplier

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power of this industry is low, the overall attractiveness according to the five forces model
makes this industry relativley unattractive.
3.3 Customers and Thei r Needs
The target group for Alfy are the consumers of New Zealand with smartphones. The needs
to be fulfilled are to provide a service which allows consumers an alternative method for
payment. This method of payment is required to be separate to the traditional wallet. It also
needs to be safe and secure.
When looking for an alternative to the traditional wallet, mobile transactions seem to be the
growing trend. According to a Business Insider article (Tony Danova, 2014), mobile
transactions accounts for about 4% of all credit and debit card volume globally in 2013, and
“have experienced 118% average annual growth in the U.S. alone”. From analyising these
results, a decision to move into the mobile payment industry seems to be a good choice as it
is an emerging technology that peole are eager to utilise.
3.4 The Product and Service
Alfy satisfies the needs of the customers by offering a smartphone app which allows
comsumers to make wireless transactions at a store via a QR code scanning system. This is
done by having the customers’ Alfy app generate a QR code from the bank, and then having
the merchant scan the QR code which allows them to accept or decline the payment.
Transactions are made directly between the customers bank account and the merchant.
3.5 Suppliers and Partners
A supplier for Alfy would be manufacturers for the terminals to be installed for businesses.
Manufacturing for these terminals would can be easily outsourced to countries such as
China. According to an article by Joseph Wilkes (2013), China is one of the top 10
manufacturing countries in the world.
Another supplier for Alfy would be telecommunications companies. These suppliers would
set up the infrastructure for transactional information between the merchant and the
banks.

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Partners for Alfy would be banks. The business relationship would allow Alfy to be able to
link the transactional system to banks and would give banks a competitive advantage over
other banks that do not offer mobile payment.
Another partner would be advertising service companies which will be displayed on the Alfy
app. These services will help generate revenues for both the advertisers and Alfy. One such
service that could be used is Google AdWords.
3.6 Strategy: Cost Leadership
The target audience for the product is all New Zealand consumers with a smartphone. With
almost all adults being consumers and smartphones becoming an ever prevalent device in
our society, the scope of the target is very broad.
We plan to make Alfy a free app to all customers, therefore the cost strategy will be low
cost.
The overall strategy is therefore cost leadership.
3.7 Value Chain Activity: Deliver the Product or Service
The most important value chain activity for this business is deliver the product or service.
As stated in our vision, we want to deliver a “swift, secure, and innovative” product. To
achieve this goal, heavy emphasis must be placed on this value chain activity to be able to
create such a product. We want to make transaction for the customers to be a quick as
possible while retaining the utmost security while delivering our service. Another reason
this value chain activity is important is because our generic strategy is cost leadershipa and
we will be wanting to be able to deliver this product to as broad of an audience as possible
in the most cost efficient process.
3.8 Business Processes
3.8.1. POINT OF SALE PAYMENT PROCESS – This is the most important process for Alfy. It
occurs when the customer makes a transaction with the merchant. The customer input the
amount of money to be transferred into the app. The app then generates a QR code for the

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merchant to scan and accept the payment. Funds are then transferred from the customers
account to the merchant and the transaction is then complete. This is part of the value chain
activity of delivering the service.

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Start
Input amount of
money to be
transferred
Obtain QR code
QR code is scanned
Retailer accept
payment?
Transaction is
cancelled
No
QR Code Processing System
Funds are
transferred from
customer to retailer
Yes
Transaction
completed
End
Accounting Department
Transaction Processing
System
Logistics department


3.8.2. ACCOUNT REGI STRATION PROCESS – This process is the initial stage of delivering the
service to the customer. The customer must first set up their Alfy account with their bank
before they can begin to make payments through the app. Once an Alfy account is created,
the customer then inputs their bank account details which is then verified by the bank
before the account is fully set up.

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Start
Create Alfy account
with user email
Input bank details
Is the information
valid?
No
Yes
Account is
registered to Alfy
database
End
Document Management
Department
Bank detail analysis system
Document Management
System




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3.9 Functionalities
3.9.1. POINT OF SALE PAYMENT PROCESS
 Display QR code
 Record transactional data
3.9.2. ACCOUNT REGISTRATION PROCESS
 Verify bank details
 Register account to database
3.10 Systems

3.10. 1. QR CODE PROCESSING SYSTEM - This system sends transactional information to bank.
The bank then returns information in the form of a QR code to the mobile device. When the
QR code is received, it is displayed by the app for the merchant to scan. This system is
designed to be streamlined and protected, which is a requirement for Alfy’s vision of being
‘swift’ and ‘secure’.
3.10. 2. TRANSACTI ON PROCESSI NG SYSTEM – Once a payment is made through Alfy, the
transaction data is recorded. This data can then be analysed to gain knowledge on such
things as customer spending behaviour. This collecting os transactional data will help Alfy to
be more innovative according to the vision statement.
3.10. 3. DOCUMENT MANAGEMENT SYSTEM – Once an Alfy account has been set up, all the
account information is then sent to and stored by the document management system. This
account information is then linked to the bank through a safe and secure network to ensure
Alfy’s vision of a secure service is not compromised.

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3.11. Summary Table: Value Chain to Systems

Value Chain
Activity
Processes Functionalities Specific Information
System(s)
Broad Information
System(s)

Deliver the
Product or
Service
1. Point of
sale
payment
process
1. Display QR code.

2. Record transactional data.
QR Code Processing System


QR Code Analysis System
Transactional Processing
System

Transactional Processing
System
2. Account
registration
process
1. Verify bank details.

2. Register account to database.
Bank Detail Analysis System


Document Management
System
Decision Support Systems

Customer Relationship
Management System

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CONCLUSION
Alfy’s vision of providing consumers with the safest, fastest, and most innovative technology
can be reached despite a tough industry to work in. Our cost leadership strategy with strong
focus on delivering our service to the customers will satisfy the needs of the everyday New
Zealand consumer. By utilising information systems and information techonology, we can
create a company which will be able to operate efficiently, securely, and to its full extent.
REFERENCES

1. BiztechAfrica. (2014). Mobile Wallets in 1 in 5 Handsets by 2018. Retrieved from
http://www.biztechafrica.com/article/mobile-wallets-1-5-handsets-
2018/8185/?section=mobile#.U4FwVPmSxpt

2. Bruce Rogers. (2014). Who Is Leading The Digital Mobile Payment Influence Battle?.
Retrieved from http://www.forbes.com/sites/brucerogers/2014/03/18/who-is-
leading-the-digital-mobile-payment-influence-battle/

3. Index NZ. (n.d.). index NZ. Retrieved from http://www.indexnz.com/

4. Joseph Wilkes. (2013). Manufacturing Countries – Top Ten. Retrieved from
http://www.manufacturingdigital.com/top_ten/top-10-business/manufacturing-
countries-top-ten

5. MasterCard. (n.d.). History of the Card Payment System. Retrieved from
http://www.mastercard.com/us/company/en/docs/History_%20of_payments.pdf

6. Payments NZ. (n.d.). Payments Explained. Retrieved from
http://www.paymentsnz.co.nz/payments-explained/payment-types

7. Tony Danova. (2014). Consolidation Is Coming To The Mobile Payments Industry.
Retrieved from http://www.businessinsider.com.au/consolidation-is-coming-to-the-
mobile-payments-industry-2014-4