The Lebanese steel factory “STEEL CO” was the leader in its market for many years. Today, the management noticed that sales are decreasing since the market prices are dropping down due to unbeatable offers and discounts from other companies operating in the market for more than 20 years ago.

The management decided to use “Analytical Power” (software) to analyze the market by collecting data online via Internet from many websites and saving this data on large servers. As a result, “Steel Co.” decided to change its production line to manufacture steel products only to luxurious villas and residential homes, located in high level areas of Lebanon. This strategy helped the company to sell targeted customers at higher prices making higher revenues. The new system includes a Website allowing customers to select online the designs they wish, and even to customize the products based on quality, colors, styles, etc…
Case Questions (6 points each)

1)What is the force according to Porter’s competitive forces model, faced by the company? *
Customers
Suppliers
New market entrant
Traditional competitor

2)What is the information system strategy (or strategies) used by the company to face the forces? *

Focus on market niche
Focus on market niche & Low cost leadership
Focus on market niche & Customer intimacy
Product differentiation & Customer intimacy

3)What are the main IT components mentioned in this case? *
a) Software / Telecommunications / Physical facilities
b) Hardware / Software.
C) Software / Telecommunications / Hardware
d) Telecommunications / Software

4)If the company is not sure which IS strategy to use in order to face the competitive forces, which model may best help in this case? *
Porter competitive forces
Value chain
Porter strategies
Economic impacts

5)To which type of system the “Analytical Power” software belongs? *
DSS
ESS
MIS
TPS

1.) Traditional competitor

2.) Product differentiation & Customer intimacy

3.) C

Software / Telecommunications / Hardware

4.) Value chain

5.) ESS

Explanation:

1.) The company was aware of its competitors' marketing strategies and pricing to any changes made. Rivalry among competitors tends to be cutthroat and industry profitability low while having the potential factors.

3.) An information system is essentially made up of five components hardware, software, database, network and people. These five components integrate to perform input, process, output, feedback and control. Hardware consists of input/output device, processor, operating system and media devices.

4.) Value chain is the process or activities by which a company adds value to an article, including production, marketing, and the provision of after-sales service.

5.) An Executive Support System (ESS) is software that allows users to transform enterprise data into quickly accessible and executive-level reports, An ESS enhances decision making for executives. ESS is also known asExecutive Information System (EIS).

Answer 1):

The correct option here is D) Traditional Competitors

Explanation:

The five forces of competition when analyzed they help a business understand the factors in its external environment. It is also helpful in crafting a strong business strategy that increases the chances of the company to win over its competition in the market.

If sales were declining due to very mouth-watering offers from other companies who are over 20 years in the industry, then the force Lebanese Steel Factory has to contend with is Traditional Competitors.  

Answer 2)  

The correct option here is C)  

Explanation:

The information system deployed by Lebanese Steel Factory helped them to identify a niche area in the market which is the ability to customize product requests. By doing this, the demonstrated a kind of empathy for what the customer wants.  

Their new system allowed customers to order for steel in a way no company in the market was doing it.  

Answer 3)

The correct option her is B) Hardware/Software

Explanation:

There is no mention of telecommunications which is a technology that enables one to communicate via radio frequency over a long distance.

The "Analytical Power" however is a software. Softwares require hardware (that is a computer which may or may not be remote) to run.

Answer 4)

The correct option here is C) Porters Strategies

Explanation:

There are generic strategies identified by Michael Porter that a business can adopt to beat the competition. They are:

Cost Leadership, Differentiation and Focus strategies.

Answer 5)

The correct option here is C) MIS

Explanation:

MIS stands for Management Information System.

This is often used to refer to any computerized system that enables one to acquire data, process data into usable information, store both the data and information and generate reports based on such information for use in decision making by the management.

Cheers!

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