Chapter-2

Business Strategy
Contents

2.1 Business Strategy Management

2.2 Technological Strategy Management

2.3 Business Industry

2.4 Chapter Quiz

Business Industry
Business Industry
2.3.1 Business System

2.3.2 Engineering System

2.3.3 e-Business

2.3.4 Consumer Appliances and Industrial Devices

Business System
• As a result of development of information systems, businesses using information systems have
been fast increasing, and the Internet and information systems, etc. are being used in various
business fields.

1. Systems in typical business fields

2. Software packages in typical business systems

3. Systems in other fields

Systems in typical business fields
• POS system (Point of Sales system)

• IC card

• RFID (Radio Frequency Identification)

• Electronic money

• Credit card

• Debit card (J-Debit)

• GPS application system (Global Positioning System application system)

• GIS (Geographic Information System)

• ETC system (Electronic Toll Collection system) in Japan

POS system (Point of Sales system)
• A “POS system” is one by which sales information (what was purchased, when, where, in how much quantity,
and by whom) is collected when a product is sold.

• A POS system makes use of bar codes as the standard for product management, and is used in “distribution
information systems” in convenience stores, supermarkets, department stores, shopping centers, and
restaurants, etc.

• The advantages of this system include the fact that market survey and sales forecast can be performed on the
basis of the collected sales data.

• The collected information is used in strategies such as product development and store deployment, and is
useful for adjusting the ordering quantity and inventory amount depending on the season, region, and time of
day.
Distribution Information System
• A “Distribution information system” is a general term used for systems used in the distribution
industry such as the POS system, order placing/receiving system, shipping system, etc.

Financial Information System

• A “Financial information system” is a general term used for systems used in the finance industry,
such as the ATM system, stock trading system, foreign exchange trading system, etc.
IC card
• An IC card is a plastic card in which an IC chip (semiconductor
integrated circuit) has been embedded.

• Since data can be encrypted, this card is being focused upon as one
that cannot be forged easily.

• Moreover, when compared to a conventional magnetic card, the

amount of information that can be stored ranges from a few tens of
times to a few hundreds of times, indicating that a large amount of
information can be recorded.

• An IC card is functionally advanced than a magnetic card, because

of which its installation is being promoted in various fields.
 RFID (Radio Frequency Identification)
• RFID refers to a mechanism of identifying and managing persons and objects through a
minute “radio chip.”

• Since a radio chip can be processed into a label seal, an envelope, a keyholder, a wrist
band, etc. it has become easy to provide radio chips for humans and objects.

• In addition, a major characteristic is the function that enables simultaneous identification

of several radio chips.

• Therefore, it is being used in several areas such as in the management of the entry and
exit of persons through a key holder-type radio chip, or in “traceability systems” for
managing the distribution history of vegetables, meat, etc. through a label seal-type radio
chip.
RFID (Radio Frequency Identification)

• A radio chip is also called an “IC tag” or a “wireless IC.”

• The communication distance between a radio chip and a reader ranges from a few centimeters to
approximately 2 m, and power is supplied to the radio chip via an antenna.

• Moreover, since wireless reading is enabled by providing a built-in antenna in an IC card, a non-contact
type IC card is classified as a technology to which RFID is applied.

• Typical examples include electronic money, a ticket for a transportation facility, and a driver’s license, etc.`
Radio chip
• A “radio chip” is an IC chip provided with an antenna that can be read wirelessly.

Contact type and non-contact type

• “Contact type” refers to the method of reading data by inserting an IC card in a device.

• “Non-contact type” refers to the method of reading data through wireless communication using electromagnetic waves.
Electronic money
• Electronic money” refers to the payment of the price of a product through a non-contact type IC card having
the same value as cash through prior charging of the IC card with cash, or refers to such a mechanism.

• Recently, electronic money in the form of an IC tag embedded in a cell phone has been gaining popularity.

• Although its method of use is similar to a prepaid card or a gift coupon, the fact that the same IC card can
be charged repeatedly is being focused as a payment method in view of the global environment.
Credit card

• A “credit card” is a card that is issued on the basis of an agreement between a consumer and a card
company.

• A consumer can use this card to buy products and receive services within the scope of the conditions
(such as the effective period and usage limit, etc.).

• According to this mechanism, the used amount is paid later in that the user pays the used amount
upon receiving a claim for the used amount from the credit card company.

• Since the payment need not be made immediately, a person can make a purchase even if there is no
balance in the account, and either a single payment or payment in installments can be selected as the
payment method, which prove to be the merits of a credit card.
Debit card (J-Debit)

• A “debit card” is a card by which a product can be purchased by the cash card of a financial institution
that is currently being used.

• This is a mechanism by which the used amount is withdrawn from the bank account in real-time by
presenting the cash card during the purchase of a product and entering the personal identification number
in the terminal.

• Since the payment needs to be made immediately and cannot be made unless there is some balance in the
bank account, a person using a debit card need not worry about over-using the card beyond the available
balance.

• Another benefit of this card is that no payment charges are applicable.

GPS application system (Global Positioning System
application system)
• A “GPS application system” is a system that receives electromagnetic waves
from a satellite by using an artificial satellite so that a person can accurately
find out his/her location on earth.

• It was developed as one of the defense technologies of the U.S. Armed forces
that makes it possible to determine the latitude, longitude, and altitude of the
receiver with an error of a few centimeters to a few tens of meters.

• In addition to being used independently, a GPS application system is also

frequently used in car navigation systems and cell phones.
GIS (Geographic Information System)
• GIS is a system in which maps and topographic features are digitalized and various types of information is
appended so that the geographic information can be managed, processed, and analyzed comprehensively.

• It is used for marketing corresponding to regional characteristics, such as the store opening planning for new
stores and evaluation and revitalization planning for existing stores, etc.
TC system (Electronic Toll Collection
system)

• An “ETC system” is a system for automating the payment of charges for a toll road in Japan.

• The toll roads in each region across the entire country are chronically congested, and environmental pollution
due to gases emitted by vehicles, as well as an increase in cost due to congestion are becoming increasingly
serious.

• An ETC system has been developed with the purpose of reducing such economic losses, and preventing
congestion that occurs frequently at the toll booths.

• When using the ETC system, a driver uses a contact-type IC card issued by a credit card company. By
inserting this IC card in an ETC in-vehicle device, the toll booth can be passed without having to stop the
vehicle.
Smart grid

• A “smart grid” is a power network (grid) in which a dedicated device and software are embedded so that the
demand and supply of power can be controlled.

• By using a smart grid, a power company can adjust the balance between the demand and supply of power so
that wasteful power generation is prevented.
CDN (Contents Delivery Network)
• A technology or service used to promptly deliver digital contents having a large file size such as images,
movies, programs, etc. via a server and network arranged at a location that is geographically closest to the
accessing user.

• As a result, simultaneous access to the network is avoided, and accesses can be distributed geographically.
Software packages in typical business systems
• ERP package (Enterprise Resource Planning package)

• Software package for each job role

• Software package for each industry

ERP package (Enterprise Resource Planning package)

• This is a software package that has been developed with the purpose of managing the management
resources of a company (such as personnel, objects, money, and information) in a consolidated
manner to improve the management efficiency.

• It integrates the systems managed in each department and enables their mutual referencing and
usage, and since information can be managed in real time, it proves to be effective in improving
the management speed.
ERP package (Enterprise Resource Planning package)

• “ERP” is a technique of improving the management of the entire company through the effective
use of all management resources (such as personnel, objects, money, and information) of the
company from production to sales, accounting, and personnel affairs.

• It is referred to as a management technique by which all management resources are managed

comprehensively across the entire company, and arranged and distributed optimally so that
effective management activities can be performed.
Software package for each job role

• This is a general-purpose software package used in the accounting service, sales support,
inventory control, sales management, etc.

• This type of software package brings together the functions necessary for a job role common
across all companies, such as the accounting work, sales management tasks, the employee payroll
calculation work, the customer information management work, etc.

• For example, in the software package for accounting, the management material such as the trial
balance sheets, closing account reports, etc., and financial statements can be created automatically
only by making entries in the journal voucher.
Software package for each industry

• This is a software package that is used in financial institutions, medical institutions, and industries
such as the manufacturing industry and the transportation industry.

• For example, in medical institutions, there are several job roles that cannot be supported by the
software package for each job role, such as management of medical equipment and devices,
difference in cost due to the treatment method, management of NHI (National Health Insurance)
points, etc., but this package is created in such a form that it can be used for each industry so that
job roles matching each industry can be performed.
DTP (DeskTop Publishing)

• “DTP” refers to performing the design and layout available on paper for a published matter on a
computer, and then transferring the created data to a printing company for publishing.

• In order to perform DTP, a dedicated software package is used for manipulating photographs,
illustrations, paper layouts, etc.
Systems in other fields
Basic Resident Register Network System in Japan

• A “Basic Resident Register Network System” refers to

a system that joins a country or government agencies
such as the nation-wide local public organizations via a
network, and enables sharing of a “Basic resident
register” containing the name of a person, date of birth,
gender, address, resident register code, etc. across
Japan.
Systems in other fields
Electronic application and notification system in Japan

• An “Electronic application and notification system” is a system

by which applications or notifications are received in
government agencies such as the government and municipalities
by using the Internet from one’s own home or workplace. Since
this system also enables the acquisition of the application format
necessary for the procedures via the Internet, a person can
perform the procedures at any suitable time of the day without
taking the trouble of going to the government agency.
Electronic bidding
• “Electronic bidding” refers to a bidding system implemented on the Internet.

• By electronically bidding for orders of the country and local public organizations, not only can
operating expenses and personnel expenses be reduced, but the chances of consultations are also
reduced.

• Electronic signatures are used for user authentication of electronic bidding.

CTI (Computer Telephony Integration)
• “CTI” is a usage technology by which a telephone and FAX are connected to a computer.

• It enables automatically responding to phone and FAX, or routing them to their appropriate
destinations in accordance with the sender.
Q&A