INDIVIDUAL ASSIGNMENT

(CASE STUDY)

PREPARED BY
NO. NAMES MATRIC NO.
1 LEE BOON FOONG PBS18212251

MANAGING INFORMATION SYSTEMS

(MGT 7102)
TS. DR. AHMAD SHAHARUDIN ABDUL LATIFF
PUTRA BUSINESS SCHOOL
18TH APRIL 2020 (SATURDAY)
Case Study 1
i) Appraise the economic as well as the organisational and behavioural impacts of
information systems on AirAsia.
ii) Explain the competitive advantages of AirAsia using the Porter’s Competitive
Forces Model
iii) Describe AirAsia’s information system strategies for dealing with Porter’s
competitive forces.
Answer:
i) The organizational and behavioural impact of information system on Air Asia is
the company enjoy benefits of transaction cost and agency cost. Information
system technology cause factor of production can be freely substituted for capital
and labour. Advance in technology automated process cause less capital and
labour required to produce output. Company enjoy benefits of transaction cost.
Currently, they can obtain product and service which is lower internally compared
using external resource which is higher cost. Company may be able to generate
more revenue as compared before. Besides transactions cost, one of impact of
information system on Air Asia is agency cost reduced. Information system can
change the company structure because it can reduce agency cost, the cost of
coordinating different people in an organization and activities. With flow of the
information, manager easy supervise the staff and giving staff more decision-
making authority.

ii) Rivalry among the low-cost airlines is very high. Therefore, Air Asia always
competitive among each other by offering the low price. However, the Air Asia
need to gain more market share in order to offering low price because air lines
company faced high fixed cost such as staff cost, fuel cost, finance cost and etc.
Besides, Air Asia also enjoy competitive advantages of high barrier to enter to the
airline market. This is due to the capital requirement for start-up the operation is
high. Thus, the threat is low for Air Asia. Some more, with the advance
information technology, Air Asia is the first airline enable customer to book and
purchase ticket online in Malaysia. Although new competitor can offer the service
as Air Asia, but they are hard to compete with Air Asia. The moderate access to
distribution channel is low.

iii) AirAsia’s has installed a system named as Revenue Management System. Under
Revenue Management System, Air Asia optimises revenue from passenger seat
sales. It continuously and constantly monitors and adjust its fares based on date of
flight and forecasted and actual demand of flight. This help Air Asia offer
differentiation strategies to offer lower prices in order being competitive in the
market. With the ERP system, Air Asia also increases able to reduce financial
report month-end-processing time. The ERP able to estimate the flight cost per
trips and profit generated from the trip. It is to knows as low-cost leadership
strategies. In addition, financial reporting helps the management can forecast
 suitable time hedge fuel price to avoid fluctuation on oil price. The hedge
strategies are important to reduce the risk.
Case Study 2
Amazon is alleged to use unfair and uncompetitive policies to smoother competition
especially in India. Yes or No? Why?
Yes, I am agreed that Amazon is alleged to use unfair and uncompetitive policies to smoother
competition. First, if we search product in their website, Amazon promote aggressively by
display their own products before others. Amazon prioritise their product first, put it in the
top list before other brand of products. Yet, Amazon also perform undercut actions by fairly
use sales and other data from its sellers to create their own brand. Then, they sell alongside
their vendors. It is considered unfair to its customer or vendor. Then, Amazon will be
dominating the market share as soon and cause the consumer benefits to be harm.
Besides, Amazon pricing structure need to fulfil by its own seller. Every seller in the Amazon
will use Amazon logistics service known as FBA in order to store their good in Amazon
warehouse. The storage is opened to every seller even they sold outside of Amazon, whether
on their own website or other shopping platform like E-Bay and Etsy. However, the FBA
charges fees is higher if seller sold from another website instead of Amazon website.
Therefore, seller may sell higher price in other website to cover the cost of purchasing FBA
service from Amazon. This causes situation where Amazon not allow sellers ton reduce price
in another website. It indirectly controls seller to sold lower price in another website and
create a discrepancy.
In addition, Amazon also stop another giant company, Apple to sold its product in Amazon
website. This is due to the reason that Amazon avoid from compete with Apple. Competition
between both companies will harmful to Amazon. As an prove, in year 2015, Amazon
announced ban sale of Apple TV, which believed that Apple TV suppress the sale of products
to its own Fire TV products. The imperfect competition between the companies will dilutes
the consumer benefits and harm to society as the companies easily dominating the market.
One of the reasons cause unfair and uncompetitive policies happen especially in India
because India don’t have own e-commerce platform. India should learn from China to create
an e-commerce to encourage competition between local and foreign e-commerce. For
example, Alibaba, a giant e-commerce was created by Jack Ma in China to compete with
Amazon that created in America. Alibaba is for Chinaman while Amazon is for American.
Thus, India should create a platform for their own people. By created a e-commerce platform,
the Amazon will need to compete with the new local e-commerce and it is believed that
unfair and uncompetitive will be overcome.
The situation of unfair and uncompetitive policies occurs due to the law and regulations in
India. India should set a rule and regulations to control the e-commerce operation. Foreign
direct investment should be encouraged because it can play an important role to growing a
country. However, law and regulations must be well stated in order to protect local and
traditional business from harm by the foreign company.
Case Study 3
a) Suggest the growth of the sell-side of e-commerce that could be made possible by using
mobile phone as an infrastructure platform.
b) Propose and explain three (3) other types of sell-side e-commerce that could be made
possible using the mobile phones today.
Answer
a) In Kenya, sender want to send parcel but receiver cannot receive it. Therefore,
Safaricom use mobile phone as post office address to started the digital postal service.
In Kenya, the internet is not strong and this cause people in Kenya difficult to
communicate. Now, by offering post box service, the issue may be overcome. Some
more, post box is much cheaper for the sender. By offering this service, everyone that
has phone can receive their parcels and letter easily. The service is important and will
be grow due to the high demand of Kenya people. Urbanisation in Kenya is 26
percent, therefore internet coverage in Kenya is poor. They have limited access to
internet. The condition is worse because 80 percent of them is stay in rural area.

b) One of the types of sell-side e commerce that could be made possible using mobile
phones today is transactional e commerce sites. Through the transactional e-
commerce site via mobile phone, it will enable purchase product via online. It is more
convenient because everyone now has their own mobile phones. They did not need to
spend their time for travel, avoid the traffic jam and reduce cost of travel. They can
online shopping anytime and everywhere. They can now spend most of their time to
surf for product and purchase it just click on the purchase button. Besides, they can
get more information about the product and get better purchase price as every single
seller is competitive in the market. The example successful of transactional e-
commerce are Amazon, Taobao and etc.

Besides transactional e commerce site, the other sell side e-commerce that could be
possible using mobile phone is brand-build sites. The function of the site is to provide
experience to support the brands. The main purpose of site is to develop online
experience of the brand to support branding. Different with transactional e commerce
site, products are not available for purchase online. Example of brand building site
can be link to business such as hostel, restaurant and etc. Let take an example,

The last sell-side e-commerce that is possible using mobile phone is media sites. It is
referring to gateway to obtain the information via online. Twenty years ago, when we
have computer, every single information we surf need to depend on computer.
However, with the advance technology, currently we can search the information by
using our phone. It is more saving time and convenient. We can search whatever we
want at any time and everywhere. The information is links to other sites.