Ida, Zaty, Lin & Shaf

WM MORRISON

1. Purpose of IS/IT strategy implementation

As we know, our world nowadays is moved forward very fast. Anything that
we want to do is all based on technology. So, for the company that has many
retail supermarkets and also wants to involve in the international petroleum
companies and financial services, they really need high technology. With high
technology, works and task will become easier to be done and we will receive
more information more quickly. For example is such using data mart. Data mart is
a small data warehouse designed for a strategic business unit (SBU) or a single
department. In addition, they also need to upgrade or use the software that more
easily and quickly for operating system. The process of storing and delivering
information will become slow if they still using old software.

2. Overview of business strategy and objectives

The aim of MW Morrison is to provide to all customers with the very best
value for money wherever they live and uniquely, Morrison has always charge
the same price in every one of their large store. There are many strategies use
by Morrisons company. Firstly, they make an improvement in packaging,
increasingly quality and branding, consistently with a growing trend toward selfservice shopping. Ken Morrison also upgrade his family company into more
advance supermarket system industry, placing prices on all its items and goods,
and adding checkout lines, that is the first supermarket used this method in
Bradford area. In order to continue opening new stores, Morrison started to take
over a few stores to make it as their new store including ten-store chain of
Whelans Discount supermarket that purchased from JJB Sports in 1979.
Morrison extend their business strategy by generating profits while maintaining
low prices, as they operated its own subsidiaries to provide products, packaging,
and distribution to its stores. Moreover, Morrisons company format- a Market
Street concept that reproduced the feel of the stalls and small shops of a typical
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High Street around the periphery of the Morrison store that appealed to
customers. One of Morrisons special strategies is its persistently to their
discount formula and its insistence that all of its stores introducing the same
prices to consumers whereas other companies prices varied from store to store
depending on locations. This formula is really proven in order to winning
customer loyalty. Besides that, Morrison also agreed to extend their operation
hours to include Sunday. As a result, their annual sales and profits increase
steadily. Morrison continues to open their new store and make the French
hypermarket concept that extends traditional grocery lines into wide variety of
consumers goods as a reference. In 1997, Morrison reached an agreement with
Midland Bank to bring banking into its supermarkets, in order to compete with its
competitors. Finally, Morrison completed a new investment program in its
Farmers Boy subsidiary with an opening of a new 180,000-square-foot
processing facility.

3) Summary of Opportunities/Problem/issues
Based on Morrison we can conclude that they have a problem regarding
their outdated operating system which is using window98 workstations and
separate fixed computer and telephone which is we can barely known they will
faced a lot of problem such as often down causing delays in dealing with

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customers and suppliers. From here we can found that wm Morrisons had a
problem in their old retailing system, operating system and networks. So, in
order to come out with a new suggestion with all these problem, we have find out
a few solution which is they need to improved in term of retailing system and use
a standardize retailing system, because they will minimize the system problem a
lot, the example of retailing system is POS system which is this is the latest
retailing system. Furthermore for improving their workstation which is they still
using old version of window98 and as we know today we have many types of
operating system open source such as window vista, window 7 and latest
operating system. The reasoned why they need to improve their window is, they
have expended their business in many different countries. Moreover they have a
problem in networking, from our observation they need to change their network in
one line, it is because they can minimize the delay causes by two different
networks which is computer and telephone.

4) Argument for new IS/IT opportunities

In stabilize our argument, here we state the advantage and disadvantage
of IS/IT that we have purpose for them in reengineering their system and
operating system. Firstly POS retailing system is the latest retailing in Malaysia
and it has been applied in MYDIN Malaysia, this retailing system controlled all
retailing system in Malaysia in one system and did not used a separate retailing
system, so when the retailing system is down, they can identify and solve the
retailing system error in a fastest way, POS retailing system also minimize error a
lot for retailing transaction. We think that they did not have to monitor all the
retailing for different places or many computers, it is due to they have a lot of

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WM MORRISON

other business expend in the world wide. The disadvantage is POS retailing
system is expensive because it is combination all of transaction in only one
computers. Furthermore the advantage of installing new operating system is the
workstation more flexible and it can reduce redundancy in every computer, and
the disadvantage is the operating system is expensive because they need to
install the original one and not the pirate operating system, the original costly
about hundred and above and for sure they need to install every single of
computer that they had. Moreover they need to provide training for their staff
because most of computers are using window98 and the workers are not familiar
with the new operating system. Lastly is regarding the network problem in
Morrisons company, from this problem we suggest that they must change one
line or single router beside increase the network line, so from changing new
network line they can reduce problem in dealing with customers and suppliers in
a future. In gaining efficient management and increasing profit, Morrisons need
to follow latest IS/IT to ensure that they will compete successfully with the world
company.

ATTACHMENT
i) SWOT ANALYSIS

SWOT analysis diagram

Strengths
Strong presence of
across the supply chain
Strong foothold in UK
market
Wide of products
Diversify business

Opportunities
New retail space
Market for organic
products
Demand of own products
Emerging new market to
global market

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Weakness
Products recall
Limited geographical
presence
Limited technology used
Legal proceeding

Threats
Intense competition
Slowdown in UK economy
Emerging of new and
advance technology
New business law or rules
and regulations
Consumer preferences
change

ii) PEST ANALYSIS

Political factors including government regulations. When the

company established a small foothold in the USA, China, France
and Sweden, the company should follow the country regulations.
Then the tax policy is also a factor to the company because it had
made a partnership with petroleum business.

Economic factors upon on the global market because the

company has a global business, type of economy depending on the
current world economy whether its inflation or recession and foreign

exchange, is it high demanding or not of the home grown currency.

Social factors depends on the impact on the customers need
and potential market size for goods and services. The company is
provide needed items for customers like grocery items then involve
in others business field that provide services such banking and
petrol station. The grocery and foothold also petrol station is a
ongoing business that really

makes lot of profit and can be

globalization

Technology factors the company is using the outdated systems

and technologies. To improve the business, current and advance
technologies should be use such as POS system, Data warehouse,
Data mart, internet access, updated software and also using
suitable technologies devices.

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iii) PORTERS five forces

Porter's five forces diagram

Threats of substitution
Buyer switching cost
Buyer propensity to
substitute
Product differentiation

Buyer power

Competitive Rivalry

Supplier power

Buyer information
Buyer volume
Buyer price sensitivity

Number of competitors
Size of competitors
Industry growth rate
Differentiation
Exit barriers

Supplier concentration
Importance of volume
to supplier
Cost relative to selling
price

Threat of new entry

Switching costs
Economies of scale
Capital requirements

Supplier power the supermarket chain situation, the supplier are from various
areas, depending on the specialization products produce in the UK country.
Examples, fresh egg are from supplier in North West and strawberries supplier
are from Scotland. The company concentration on one supplier for each product
and they also provide their own brand of products. The company has many
suppliers that can provide stocks with high quality in low prices due to the
company buying in a lot of quantity

Buyer power target user or the buyer of supermarket and foothold business is
the society everyone need the products and services that the company provide.
Then, the company is targeted local consumers within European country. Type
of country shopping culture and taste is already analyzed because the selling
and buying transaction is being done by the people who live in the countries. The
company is using discount formula for its business strategy.

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Competitive rivalry - The key driver is the number and capability of competitors
in the market. Many competitors, offering undifferentiated products and services,
will reduce market attractiveness. The nearest competitor was Metro AG which is
UK number 1 largest retailer. The other is like ASDA and Tesco. But
nevertheless, all of this big name are in one industry which is foothold retailer
and still become the most profitable business.

Threats of substitution many retailers is providing the same private brand

labels including WM Morrison. The others retailer can attract the consumers with
lot of marketing strategy such as promotes the very low prices, making a
promotions and other. The way to make it look different is by adding different
products like WM Morrison is more to organic products, fresh from farm and also
the diversify of the business by joining oil and gas sector and banking sector.

Threats of new entry - emerging of the newcomers retailer in grocery and

foothold industry which provide more attractive marketing strategy and
diversifying products and services also gain advantages in economy of scale.

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