VTB's operational capabilities
To maintain a competitive advantage, VTB needs to build their business model keeping 5 strategic pillars in mind in order to achieve a high-performance company – Leadership, Innovation, Information Technology, Organizational excellence and agility and Knowledge. The Vermont management team grasped this concept in the initial stages of their development, but did not continue to embrace these pillars to ensure on-going success. VBT has most of their operational capabilities and strengths in the IT field as their business model is heavily based on IT. They do have some good operational capabilities, but they also face several challenges, especially during the ...view middle of the document...
• Although during the peak time when the middleware pauses, the IT team members are somehow able to patch things together to make the delivery on time; however it is a temporary solution and not a foolproof one. In order for meeting the demand smoothly, the middleware has to go and a strong unifying technology platform has to be created.
• There is room for improvement in the supply-chain management; they have had stuff that has arrived late or has been of poor quality.
• There is room for improvement in their marketing once they know who they want to target and what they want to convey.
• Systems are aging and the IT team has a constant decision to make on how to prioritize what to invest in as far as modernization and upgrade goes. For e.g. build or buy new supply chain software to enhance operational capabilities or to replace the accounting systems, etc.
• During peak seasons software bugs have been identified that need to be fixed by the IT members before the next peak experience.
• Their advertisements have been conveying a wrong mess and it is taking a hit on their peak season sales.
VTB's Information Systems:
The strategic alignment of VBT is definitely not in place. According to the Strategic Alignment Grid shown above, VBT falls in the Misalignment quadrant where they had a strong business model but a very weak IT Infrastructure. They definitely face some severe IS improvement challenges if they want to align the strategic and operational needs to meet their corporate goals. As a member of VTB Board of Directors, I would be alarmingly concerned about the IT architecture of VTB. The problems that I see in the IT system of VTB are as follows:
• VTB does not have a uniform technology platform. It has four different channels (retail, mail, phone, web) for three different product lines and also for different IT functions (be it sales or CRM or supply chain management), creating a spider web of connectivity.
• There is only a very little change that one can make to the processes and applications. This is because the formal IT organization had not instituted such processes nor prepared a procedural document. There are many ‘shadow applications’ that have been developed by users to fill various needs when the IS organization lacked resources to help. Some applications are then connected via middleware to the core enterprise applications that are under the control of the IT organization.
• The black box (middleware) is holding the IT team up from doing all sorts of things to support both their traditional and newer eCommerce processes.
• There were users who were requesting or enhancements and VTB is not being able to deliver most of them.
• VTB does not have enough staff in the IT organization which currently comprises of seven people. They had let go off several IT staff during the economic downturn.
• These seven people fortunately have the expertise to solve IT problems, but all of them do not have the same level of expertise. Some...