SIS or strategic information system can be stated as an information system, which is being developed in response to the corporate business initiatives. This type of system is intended for providing several competitive advantages to a company (Galliers and Leidner 2014). It allows them in recognizing opportunities for their development and growth in improvement of operational effectiveness and efficiencies. Business strategies are easily implemented with the help of strategic information system.
The following report provides a detailed discussion on a significant and famous beverages Australian organization called Lion Nathan Company. This is a major company, which produces various kinds of drinks and beverages for their clients. This report comprises of two distinct parts of external analysis and internal analysis. The first part of external analysis consists of the company background, industry description, competitive environment as well as opportunities and threats. This internal analysis consists of intangible or tangible resources, capability identification and finally core competency analysis. Appropriate information system will be suggested for Lion Nathan Company.
Part 1: External Analysis
1. Background of the Business
Lion Nathan Company is one of the most famous and significant food and beverage organizations that is responsible for operating within Australia and New Zealand. This specific company majorly produces and does marketing a wider range of spirits, beers, RTDs, cider and wine (Lion.co.com. 2018). Apart from the above mentioned drinks and beverages, Lion Nathan Company also produces dairy as well as other beverages such as flavoured milk and plain milk, yogurts, cheese, juices and soy products.
They have become extremely successful in the food and beverage industry and even is providing various products and services to their customers. Lion Nathan Company was being founded in year 2003 by New Zealand Breweries and their present headquarters is located in Sydney, Australia. Lion Company is owned by Mitsubishi and currently the total number of staffs is around 7000 (Lion.co.com. 2018). In the year 2015, Lion Nathan Company obtained total revenue of 5.6 billion Australian dollars.
2. Description of the Industry
Lion Nathan Company eventually belongs to the Australian industry of food and beverage. This particular Australian industry mainly produces several categories as well as types of food and beverage to their customers (Arvidsson, Holmström and Lyytinen 2014). This food and beverage industry mainly comprises of every organization that is involved with the processing of raw food materials, packaging of these materials and finally distributing to the clients. Food and beverage industry includes fresh foods, packaged foods as well as readymade foods, and non-alcoholic and alcoholic beverages.
3. Analysis of General Environment for Lion Nathan Company
The general environment of the Lion Nathan Company of Australia could be easily analysed after taking into consideration some of the most significant and important factors (Willcocks 2013). These factors are eventually termed as macro external factors and they help in understanding the position of the organization in the outside market or country. There are seven distinct macro external factors that could be effective as well as efficient in knowing this organization of Lion Nathan Company in a better manner and these are economic, physical, sociocultural, global, technological, political or legal and demographic (Malhotra, Melville and Watson 2013). The details of these seven factors for Lion are as follows:
- i) Economic Factor: The first and the foremost macro external factor for general environment analysis of Lion Nathan Company is economic factor. This particular organization is gaining subsequent popularity every day and they are getting an increase in their sales and revenue effectively (Rainer et al. 2013). As per a survey in market, the total revenue of this company of Lion Nathan was more than 5.6 billion Australian dollars in the year of 2015 and hence it states that they have gained major profit in their business. Moreover, costs of raw materials and foreign exchange rates are affected with this type of rise in profit and revenue. However, Australian Drug Foundation has restricted the uses as well as manufacturing of alcoholic beverages and thus Lion Nathan Company is eventually suffering from several economic crisis (Earl 2013).
- ii) Physical Factor: The physical factor of general environment majorly influences the overall development and growth of the business. This type of factor is also referred to as the environmental factor and it helps to increment the total environmental advantages for the respective society (Laurini 2014). For Lion Nathan Company, the respective demand for their beer consumption has lowered due to various climate changes and conditions.
iii) Socio Cultural Factor: The third distinct factor is sociocultural factor that is responsible for focusing on any specified social environment as well as identifying several emerging trends (Laudon and Laudon 2015). The respective client requirements is also properly fulfilled with this factor. Moreover, Lion Nathan Company is producing lower carb beer, which have become extremely popular for the youth generation as they are concerned regarding weight.
- iv) Global Factor: The fourth type of factor for general environment analysis is global factor (Altameem, Aldrees and Alsaeed 2014). This particular factor refers to marketing and shares of products and services in the globalized market. It should be checked that how well the market is accepting their products and services.
- v) Technological Factor: This type of factor significantly refer to the specific factor that could easily enable major technological innovativeness in a business (Park and Lee 2014). Technological factor solely includes significant alterations in mobile technology and Lion Nathan Company has used various popular technologies to perfectly execute the business processes and operations.
- vi) Political or Legal Factor: Another distinct and important general environment factor for analysis of Lion Nathan Company is political or legal factor (Dwivedi et al. 2015). This particular factor is responsible for proper determination of the limits until which the country’s laws or government policies will be impacting on them effectively. There are several political policies, taxation policies, trade and fiscal are even involved in the political factors. Australian government has imposed huge excise duty for alcoholic beverages. This has become a major issue for reduction of sales as well as alcohol consumption to a higher level (Osterwalder and Pigneur 2013). There are various imposed taxes as well and hence shares are also decreasing in Lion.
vii) Demographic Factor: Since, Lion Nathan Company belongs to the food and beverage industry, it is evident that they are mainly popular for the youth generation and children. Hence the demographic segmentation of this company is for children and youth generation (Reich and Benbasat 2013). Apart from this, Lion even makes diet food and dairy items and hence are being used by all. Thus, Lion has a huge demographic segmentation for all types of customers.
4. Explanation of Industry Environment
A proper explanation of Lion Nathan Company could be easily provided in respect to the analysis of industry environment. There are five distinct factors of supplier power, buyer power, potential entrants, substitute products and rivalry among competitors, which are to be referred for this industry environment analysis (Stair and Reynolds 2013). The description of these five factors are as follows:
- i) Supplier Power: The first and the foremost factor is supplier power, which is quite higher for this company of Lion Nathan. Since, this is one of the most significant regional company, it has its major suppliers engaged to distribute the products and services within New Zealand as well as Australia effectively (Cecez-Kecmanovic et al. 2014). The supplier number is lesser and switching expense is extremely higher for Lion Nathan.
- ii) Buyer Power: The second significant factor for Lion Nathan Company is buyer power. There are several popular beverages organizations in the existing market and hence there is a constant competition between them.
iii) Potential Entrants: Several new entrants are eventually entering the market and they could easily undertake position of Lion (Uçaktürk and Villard 2013). This particular threat is extremely common for all types of businesses.
- iv) Substitute Products: Since, Lion is making beverages, there are several substitute products within the market and these could be extremely vulnerable for the business. Moreover, they might even face losses in the business.
- v) Rivalry amongst the Competitors: There is always a healthy competition or rivalry amongst the competitors in any market (Qrunfleh and Tarafdar 2014). Similarly, there is an ongoing rivalry amongst the competitors and Lion faces this every time.
5. Competitive Environment for the Company
Competitive environment of this company helps to understand the market position properly. Lion has formed a strategic group and they analyse this competitive environment with the help of strategic information system (Kavanagh and Johnson 2017). Strategic information system could easily deliver any product and service in low cost, which is differentiated and could focus on any specific market segment.
It is extremely helpful for the organizations and businesses in categorizing, storing, processing as well as transferring relevant information that are to be created and received. After proper evaluation it is observed that as various companies are present in the market, there is an increment of competitiveness (Peppard and Ward 2016). The similar products are taking the market by implementing unique strategies of their companies and thus Lion comprises of a distinct threat in its competitive environment.
6. Opportunities and Threats of the Company
The most significant opportunities and threats of Lion Nathan Company are as follows:
- i) Opportunities: The most important and noteworthy opportunity of Lion Nathan would the innovation of several products as well as services for their clients. It would be extremely helpful to them for improvising their market position and thus ensuring variety and innovation in products (Osterwalder and Pigneur 2013). The second important or vital opportunity of Lion would be that they could easily gain major popularity in the market after knowing their clients’ demands.
- ii) Threats: Although, Lion Nathan Company has several significant opportunities in the business, few of the threats are also present in there. The most significant threat of this company would be entering of new entrants in market and hence reduction of business growth up to a significant level (Laudon and Laudon 2015). When the clients would get better products in low costs, there would be a higher chance that these clients will use the products. This is mainly because of the fact that the costs of products in Lion Nathan is quite higher than in other company products and services and thus it is a significant threat to the company.
Part 2: Internal Analysis
1. Tangible and Intangible Resources of the Company
This particular company of Lion Nathan Company majorly produces various kinds of beverages for their customers (Altameem, Aldrees and Alsaeed 2014). In this purpose, Lion is using several significant resources of this company. The resources are further divided to two distinct parts of tangible and intangible.
- i) Tangible Resources: These tangible resources are being utilized by any company with the core purpose of gaining significant opportunities and then earning advantages for the organizational economic growth and development. This type of resource is also considered as one of the major and the most significant resources eventually (Park and Lee 2014). For this company of Lion Nathan, the respective several tangible resources would be machines, buildings, land and various others. The competitive advantages are majorly gained with the presence of these resources.
- ii) Intangible Resources: On the contrary, these intangible resources are such resources, which are responsible for helping any specific company to gain various advantages for their future. Several subsequent opportunities of this Lion Nathan Company are considered as their intangible resources (Reich and Benbasat 2013). Good quality of products, good will of company are the other significant intangible resources of Lion Nathan Company. There is always a high requirement of business expansion and thus competitive advantages are obtained here.
2. Identification and Explanation of the Capabilities
Several opportunities that are properly achieved by Lion Nathan Company are indicated with the help of recognition of company’s capabilities (Stair and Reynolds 2013). Although, Lion is one of the most popular and significant organization in the food and beverage industry of Australia and New Zealand, they still have the capability of growing better. They could even be on the top position throughout with other rivalries and few significant factors must be considered by them such as improvisation of products and bringing innovation cost effectively.
3. Analysis of Core Competencies
Core competency of a company usually helps them to properly determine the organizational capability to make proper strategic planning (Malhotra, Melville and Watson 2013). There are four tests, on which there could a proper analysis of these core competencies and these four tests are given below:
- i) Strategy should provide important and major value for organizational growth.
- ii) Strategy should be helpful to increase market shares.
iii) Organizational competitors must be analysed periodically.
- iv) Strategy should bring out competitive advantages in the company.
- 4. Proposal of Suitable Information System Solution for Requirements of the Company
There are broadly three types of information systems, which are financial, operational and strategic and amongst them, strategic information system could easily streamline the respective business objectives as well as align business processes easily and promptly (Willcocks 2013). This strategic information system even offers various tools to help the organizations in analysing tools for their repositories of information.
The latest information is effortlessly found out in respect to promotion, production as well as marketing of products and services and this type of innovation is closely linked to the business strategies. The recommendation of information system for this Lion Nathan Company is decision support system or DSS (Galliers and Leidner 2014). As they are confronting subsequent competition in their business, the process of decision making would be extremely effective for them to undertake important decisions easily.
5. Evaluation of the Proposed System with Recommendations
DSS serves every business level like management, operations and planning for any organization and hence is helpful for effective and efficient decision making. It comprises of the major capability of sorting out issues for both structured and unstructured decisions (Arvidsson, Holmström and Lyytinen 2014). The major and the most significant benefit of this type of information system would be it is effective and helpful to reduce the total expenses in businesses and also providing subsequent solutions for the difficult problems in business.
Therefore, from the above discussion, it can be concluded that strategic information system could be described as the kind of system, in which resources of information services are being applied to the strategic business opportunities in such a manner that computer systems would affect the respective business operations and products or services. These types of systems have the capability of developing business initiatives. Strategic information systems are also termed as the types of information systems that are responsible for providing support to the business.
Efficiency and effectiveness are enhanced majorly with such systems and hence these are extremely popular for all organizations. The above report has clearly demonstrated the importance of strategic information system within the food and beverage Australian organization of Lion Nathan Company. A proper external as well as internal analysis is being done for this company and relevant details are provided in this report. Moreover, significant recommendations regarding selection of information system is also provided for Lion Nathan Company in the report.
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