Strategic Information Management Assignment
Content
Strategic Information Management
Group Assignment
Submission Date: 2012-12-1
Table of Content
Background Very often, when consumer buys a product, the first thing attract their attention are the packing instead of the product itself. It implies, the first impression is mostly accountable by the packaging. Regardless of the category, every successful product needs a good packaging that helps to build up a good and professional image. Also, a suitable packing design helps to raise the level of elegance for high-end product.
Packaging industry therefore is introduced to satisfy the needs. Starlite is established in the 1970’s. It is one of the paper printing and packaging vendors that help to pack up hundreds of retail products for different companies. For the past decades, Starlite become one of the major packing service providers in Hong Kong. With the help of the information technology and developed transportation network in Hong Kong, its business not only limited to local services but all over the world. It has awarded Gracol G7 Master Printer and to be the first company obtains FOGRA Process Standard Offset (PSO) certification, FOGRA PSO and GMI – packaging printing standards in mainland China. Also it has GSV certification for the last 4 consecutive years.
The Starlite headquarter is located in Hong Kong, while the production line is placed in mainland China to lower the cost. The main role of Starlite is to turn different raw materials into packing boxes, containers etc. Products such as Catalogue & Pamphlet (OEM), Label - Plain / Printed , Paper (OEM), Printed Office Stationery ( e.g. Forms ) (OEM), Box & Case - Cardboard (OEM), Box & Case - Corrugated (OEM), Digital Printing, Offset Printing, Pad Printing. The majority is paper due to cost and other advantages, like the light weight, toughness and easy painting. On the other hand, plastics films are the secondary ingredient for packing, usually for protecting the painting as well as seal the new products. Depends on the nature of products, different kinds of design are custom made for customers or provided by them. There are two major rivals in this industry. They are Leo Paper Group and Hung Hing Printing which is similar in scale and share about 60% of the printing and packaging market with Starlite. The remaining 40% is divided by other middle and smaller companies.
Porter 5-forces Analysis Five Forces Analysis assumes that there are five important forces that determine competitive power in a
business situation. These are: 1) Supplier Power How easy it is for suppliers to drive up Starlite product prices. This is driven by the number of suppliers of each key input, the uniqueness of their product or service, their strength and control over the company, the cost of switching from one to another, and so on. The fewer the supplier choices you have, and the more you need suppliers' help, the more powerful its suppliers are. For Printing and Packaging Industry, Nine Dragons Paper (Holdings) Ltd, Lee & Man Paper Manufacturing Ltd, and other several small companies were mainly supplied on the paper source in the market. Fewer suppliers in market will be more easily to drive up the paper source prices. Thus, it means that Starlite needs suppliers’ great help in providing different types of paper in manufacturing paper packaging products. Besides, most of the printing machines are mainly coming from few suppliers (such as Kodak, Heidelberg, Roland and so on.) to provide technical support solutions in printing and packaging industry. By combining the above two points, that will be indicated high supplier power from Porter 5-forces analysis.
2) Buyer Power How easy it is for buyers to drive prices down on Starlite Printers Limited. That means it is driven by the number of buyers, the importance of each individual buyer to Starlite printing and packaging business, the cost to them of switching from Starlite whose products and services to those of someone else, and so on. If Starlite deals with few, powerful buyers, then they are often able to dictate terms to Starlite. In buyer power part from Porter 5-forces analysis tools, this is driven by the number of buyers, the importance of each individual buyer to Starlite, the cost to them of switching from Starlite products and services to those of someone else, and so on. Starlite mainly acts as Original Equipment Manufacturer (OEM) for its worldwide brand customers such as Hallmark Card, American Greetings Card, Penguin Books, and so on for their paper product production. If Starlite deal with few, powerful buyers, then they are often able to dictate terms to Starlite. Due to customers’ worldwide reputation, those bargaining power are relatively high in price negotiation to Starlite. Thus, buyer power to Starlite is quite high in the result. 3) Competitive competition The competitive competition force is high. The important thing is that Starlite has the number of competitors and the ability. If Starlite has many competitors, providing them with the same attractive products and
services, then Starlite probably have a small power, they will go elsewhere, because suppliers and buyers, If Starlite did not get a good agreement. On the other hand, if no one else can do STARLITE to do, Starlite can often have tremendous power. In fact, Starlite has listed on Hong Kong Stock Exchange (Stock Code No.403) since 1993. However, they are often facing the challenges from other listed competitors such as Hung Hing Printing Group Ltd.(Stock Code No.450), New Island Printers Ltd.(Stock Code No.377), and other small or middle size printing company in the market. Each of those are providing similar printing products and servicing. Thus, some huge buyers or consumers like Hallmark Cards (HK) Ltd. may separate their huge orders into small SKU (Stock Keeping Units) and divided to do production process in two or three printing companies. Thus, small bargaining power may be in result for Starlite in facing those buyers.
4) Threat of Substitution Threat of substitution force is low, Porter's threat of substitution definition is the availability of a product that the consumer can purchase instead of the industry’s product. Starlite and its competitors will be also faced large threat of substitution A substitute product is a product from another industry that offers similar benefits to the consumer as the product produced by the firms within the industry. According to Porter’s 5 forces, threat of substitutes shapes the competitive structure of an industry. As Green campaign is often promoted in nowadays, more and more printing paper outputs will be converted into electronics method presentation to the end users. For example, electronics books present very common on tablet computer such as Apple iPad or Samsung Galaxy Tab. Also, Christmas or Birthday cards will be substituted by sending electronics mails or mobile messages in people communications for above ten years. At the result, less physical paper will be used in the world in order to save Global resources.
5) Threat of New Entry For the threat of new entry, it is very low because this is also affected by the ability of people to enter to printing industrial market. If it costs little in time or money to enter the market and compete effectively, if there are few economies of scale in place, or if Starlite have little protection for its key technologies, then new competitors can quickly enter printing market and weaken its position. If you have strong and durable
barriers to entry, then you can preserve a favorable position and take fair advantage of it. Nowadays, as the printing industry becomes saturation, some of the huge size of printing company get rid of the printing business and move to other business. For example, Chung Tai Printing Co.Ltd (listed on Hong Kong Exchange Stock No. 055) changed their main printing business to entertainment business for three years ago. Also, Midas Printing Group Limited (listed on Hong Kong Exchange Stock No.1172) has also shifted their business to property area. The cost of barriers to entry in the printing company is to get more certificated in their products and services. Most of the certificates were required by the customers. Starlite fulfill the customer requirements to get an order. Thus, there will be less and less huge printing company retaining or medium or small business will enter to this industry.
SWOT Analysis SWOT analysis is a structured planning method used to evaluate the Strengths, Weaknesses, Opportunities, and Threats involved in a project or a business. 1) Strengths Starlite is one of the paper printing and packaging vendors that help to Pack up hundreds of retail product for different companies Provided deliver swift services, customized products, an innovative packaging solution and a multitude of manufacturing options for leading global clients Starlite production sites are located in places with the strongest economies and awarded Gracol G7 Master Printer and to be the first company obtains FOGRA Process Standard Offset (PSO) certification, FOGRA PSO and GMI Starlite decided the production line is placed in mainland China to decrease the cost and services distributed all over the world to increase the sales. Packaging and Printing Industry is a low cost of manufacturing. Starlite production line is placed in mainland. Therefore the salary of the labour is cheap. 2) Weaknesses Starlite are facing the challenges from others competitors and other small or middle size printing company in the market. Moreover the order system does not fit to Starlite operation needs. Printing Industry becomes
saturation because the industry shortage of technical labours and lack of technical adoption. Furthermore, the raw material price of printing industry is fluctuation. • • • Too many business ordered a limited number of jobs Invisible e.g. People don’t know all the products produced by the packaging and printing industry Increase the cost of production e.g. technology, speed, computers, order system, quality.
3) Opportunities Starlite need to develop IT field and new technology for increase the production quality • Market Development Assistance – Government provides assistance to approved associations, export houses and exporters in their overseas marketing activities • Technical assistance – The Industry Extension Centres provide Technical, economic and managerial consultancy service to small scale industries to improve the quality of goods produced and strengthen their competitive position in the market 4) Threats Starlite services distributed all over the world but it will face to the overseas competitors and local competitors. Printing Industry has been shrinking continuously. It is facing the challenges from new technology e.g. desktop printers and shortage the skills of the printing technology. The Green Movement does not agree more printing paper output, suggest electronics method presentation to the end users.
Application Portfolio Model for Starlite Printers Limited Strategic • • Sales forecasting/Market analysis (New Microsoft Navision ERP) Customer Relationship Management Software (eSAMs) High Potential • Product tracking/traceability (Old and New ERP system)
• •
Product database / Inventory Management (Microsoft Navision ERP) Enterprise Resources Planning (New Microsoft Navision ERP System) Order processing, Dispatch, Invoicing, etc. Production control Sales analysis Production Planning Purchasing-materials Costing system (activity and product) Sales analysis Warehouse Management
• • • • • •
Payroll and Personnel System Ledges – Payables and Receivables (New Microsoft Navision ERP System) General Ledger Office systems Purchasing - general Samples Management
Key Operation
Support
By the Application Portfolio Model, IS/ IT Starlite can be separated into four areas: (1) Strategic, (2) High Potential (3) Key Operation and (4) Support.
High potential (such as product tracking or traceability) It is a potential to play a pivotal role in the future business. The nature of this systems are includes tryout projects, and they are heavy on IT but short on actual business context. Their benefits are not obvious to perform in actual business contribution. Strategic (such as Forecast and CRM) These applications contribute strongly both to high value and strategic future plan. They sustain both the present and the future business of the organization. In order to ensure these applications address strategic goals, Starlite can use these applications through their business-oriented innovation. It provides effective and efficient business support. Also, it provides a tight vertical integration.
Key Operation (ERP system) Differ from Strategic; Key operation is just keeping the present business going. For example, Billing should be worked in reliable, efficient and secure. No risk should be taken in the main business direction. Key operation is often the legacy software in the organization. Support (Payroll or Personnel System) The most expensive operation, often whether the application can be effective. Payroll or HR administration
support non-differentiating business processes. These applications must be efficient and above all inexpensive in operation. New projects on these systems will usually only be undertaken when the organization is forced to make changes on account of statutory frameworks or compliance requirements.
Remarks for Terms: SEAMS – the name of Starlite old ERP system. It is mainly for using in normal production process and Inventory process before the implementation of new ERP system (Microsoft Navision ERP) in the past few years. From the old operations experiences, the old ERP system covers only in normal Key Operation or little in High Potential areas. Microsoft Navison ERP system – the system is a new ERP system in Starlite. The system covers modules includes: Financial, Costing (quotations), Sales, Material purchasing, Warehouse, Make-up and Manufacturing process. The main difference from the old ERP which can generate analysis report, sales and material forecast and estimate time in production planning. Thus, it can be covered into several areas on application portfolio model.
Create and sustain competitive advantage As the old ERP system modules cannot satisfy to all of the internal departments in their operations and cannot fit the current several years on company work flow. Thus, the new ERP system has been introduced for about three years which is parallel worked with the old ERP in the same time. Although there will be required an addition work on some of departments, it is zero risk on normal operation during changing a work flow with new ERP and providing integration of each departments’ operation. The system is new business processes to achieve the following expected value & interests: 1) To complete the integration of production and sales, procurement Unified information flow is not implemented in the current business units and production. After implementation the basic module of ERP, all countable data unit can be unified in matching in each operation and can be easily to pass to next step operator or other departments. 2) Maximum transparency between departments Optimize the coordination between the departments and the departments, making the operation of the business information between different departments to achieve the best. Document requires the authorized signature of the relevant departments of the transmission of information in different sectors. For example, if the premium customer has confirmed their order, the Account and Finance department will generate the credit limit related to that VIP customer. If the credit limit is failed, the system will have an email alert to the customer’s Account Manager and its Senior or
Sales Vice President to do settle payment action first. 3) Unified improve the basic data Specification supplier, customer information, the recognition of the various departments of the supplier, customer information, at the same time should be unified. The product of the data is scattered in various departments, leading to inconsistent data, there is duplication of coding. 4) To enhance the processing speed of the business processes Business information that can be tracked in real time (sales orders, purchase orders, production single status, etc.), and greatly improve the exchange of information between different departments. 5) Support real-time market decisions With real-time information, companies can quickly develop marketing strategies, and closer to the real, to reduce market risk. Past information and market trends will be very easy to view in the new system, to promote good enterprise further market decisions. 6) Reducing processes running costs With processing greatly reduce manual processes, information and data are passed through the system overall will reduce management costs. Operation control will become simpler, and human errors will be reduced to the minimum. After implementation new ERP system several months later, the past data and normal activities can be analysis to be a reference in order to do normal production planning. That can support for estimating the delivery product time and material resources well-prepared in operations. It can be save time and money at the result. 7) Maximize the value of employees Reduce the need to repeat the day-to-day operation of the time, so that employees can pay attention to the most valuable features (for example: to spend more time in the management order status and order analysis, rather than simply the New Order).
Protection and Security Information security means protecting information and information systems form unauthorized access, use, disclosure, disruption, modification, perusal, inspection recording and destruction. Nowadays, information
security problem is most important in the company, Starlite has developed seven methods to protect the company.
1) User Account Maintenance All user accounts should be removed immediately when the staffs leave the company. Periodic review on user accounts should also be conducted to ensure no obsolete account exists, and the user access rights are appropriately assigned. For the user account creation, amendment and deletion requests should be documented/email. Human Resources Department should prepare a list of leavers and forward it to the IT Department regularly. The IT Department should use the list to check if all the leavers’ accounts are removed.
2) Password Policy Commonly, people use four types of password distribution policies, one password everywhere, somewhatrandom password written down, patterned password or random stored password. So Starlite has a good password policy prepared for their staff. • • Maximum password age to 60 days to enforce user to change password every 60 days; Minimum password length to 8 characters to ensure that all passwords must comprise at least 8 characters; • Set minimum password age to 30 days to disallow user to change password within 30 days after a new password has been set; • • Enforce password history should be set to 10 passwords remembered in the system; and Passwords must meet complexity requirements should be set to enable.
3) Backup Procedure/Storage Backups are thought of in terms of the data that an organization relies on to conduct its daily operations. In recent years, some new are talking about the company lost the client information. So it proves a good backup plan should be developed. File server & Exchange should perform a full backup every weekend by using open file option. A daily snapshot should also be done every mid-night.
SQL server should backup the all the databases every mid-night System ghost should be made when possible. Backup tapes should be stored in a fire proof cabinet. The cabinet should also be locked and only authorized persons can access to the tapes. The cabinet should also be located away from server room.
4) Disaster Recovery Plan A Disaster Recovery Plan is a comprehensive, well thought out, and tested process document that maps out how to respond during disaster scenarios including events such as fires, floods, earthquakes or other disasters. The plan also addresses more mundane situations such as equipment failure, human error, theft, or other localized events. The DRP should be properly documented to facilitate the communication within the IT Department. A well planned DRP can minimise business interruption in the event of critical systems failures. In addition, drill test should be performed regularly to ensure the recovery procedures can be run smoothly in case of emergency. 5) Environmental and physical controls over the server room • • • • Smoke detector Temperature, humidity monitoring system Fire alarm Access control to the server room, such as password lock.
Keeping the server room organized is a critical priority: Less stress and better use of time: When everything is in its proper place, finding connections and performing maintenance is quicker and easier. That means fewer headaches, less wasted time and money savings. 6) Anti-Virus Definition Viruses exist on your computer through the email or internet commonly. Moreover it can spread from one computer to another through sharing of "infected" files. Common methods for spreading viruses include floppy disks, FTP file transfers, and copying files between shared network drives. So we need to install the antivirus software to protect our computer from viruses and remove any viruses that are found. • The auto-update function should be set and a regular check should be done once a week.
7) Routine Job Checklist • Checking Server log daily
• • • • •
Checking Citrix Management Control daily Checking server configuration weekly Checking backup log daily Checking firewall log twice a week Checking anti-virus definition once a week
However, no routine job checklist is in place to record the jobs done by IT staff. A routine job checklist can help the management to monitor the work done by IT staff; it can also enhance accountability as it would record the responsible persons. IT staff should sign off the checklist after they perform a job. The checklist should be reviewed by IT manager regularly to ensure all jobs were completed properly.
Success factors of Order System Depend on the comprehensive order system, Starlite become one of the major packing and printing services provided in Hong Kong. With the new ERP system, it can satisfy their operations and fit the company work flow. The new system can complete the integration of production and sales efficiently. All countable data unit can be unified in matching each operation and pass to next step operator or other department easily. Therefore, it improved the communication between the departments and the departments, making the operation of the business information between different departments to achieve the best. With reduced of manual processes, it can be save time and money at the result. As the old system, the product code has duplicated in various department, leading to inconsistent data. New ERP system rearranged the duplication of product coding. Specification supplier, customer information, the recognition of the various departments of the supplier, customer information, at the same time should be unified. Success factors of Security System Starlite developed a good security guideline for their staff to follow. E.g. Password policy is one of the security guideline which can teach a staff how to set the strong password in the computer. Backup storage also is important in the company. The company needs to backup the daily operation for the record or analysis. Then a good backup plan should be included. Because of the backup size, time and taps is most important in the backup storage. In the company, disaster recovery plan is a documented process or set of
procedures to recover and protect a business IT infrastructure in the event of a disaster. If the company has any disaster events includes fires, floods, earthquakes, equipment failure, human error and theft, it can return to disaster before. Moreover, Starlite designed a routine job checklist for the management and IT staff. It can monitor the job checklist to know the IT staff is it finishes the job. It is true that the security job should be complete. Therefore, starlite also provides a good environment and technology in the security system. A well-design server room and antivirus definition software should be included. The Printing Industry must keep checking the order of mail on every day. Viruses exist in your computer through the email way is most common. So the antivirus definition can protect your company which the hacker cannot attack the company.
References: Mind Tools Ltd, 1996, Assessing the Balance of Power in a Business Situation viewed at 20th Nov 2012 http://www.mindtools.com/pages/article/newTMC_08.htm
Jwilkinson, 2010, About WikiCFO, viewed at 21st Nov 2012 http://www.wikicfo.com
E. Porter, 2008, The Five Competitive Forces That Shape Strategy, viewed at 21st Nov 2012 http://hbr.org/2008/01/the-five-competitive-forces-that-shape-strategy/ar/1
Mind Tools Ltd, 1996, Discover New Opportunities. Manage and Eliminate Threats, viewed at 24th Nov 2012 http://www.mindtools.com/pages/article/newTMC_05.htm
M.Jayalakshmi, Export Oriented Printing Units –SWOT Analysis, viewed at 24th Nov 2012 http://www.exclusivemba.com/ijemr/App_Themes/Theme1/Images/Export%20Oriented%20Printing %20Units%20ýýýSWOT%20Analysis.pdf
A. Irizarry, 2010, SWOT Analysis Of The Print Industry, viewed at 25th Nov 2012 http://easypurl.info/2010/05/04/swot-analysis-of-the-print-industry/
Rackmountsolutions, 2010, Why is server room organization important, viewed at 26th Nov 2012 http://www.experts123.com/q/why-is-server-room-organization-important.html
B. Mitchell, 2010, virus, viewed at 26th Nov 2012 http://compnetworking.about.com/cs/worldwideweb/g/bldef_virus.htm
N. Webb, 2011, What Is A Disaster Recovery Plan, viewed at 27th Nov 2012 http://biznik.com/articles/whatis-a-disaster-recovery-plan
Group Assignment
Submission Date: 2012-12-1
Table of Content
Background Very often, when consumer buys a product, the first thing attract their attention are the packing instead of the product itself. It implies, the first impression is mostly accountable by the packaging. Regardless of the category, every successful product needs a good packaging that helps to build up a good and professional image. Also, a suitable packing design helps to raise the level of elegance for high-end product.
Packaging industry therefore is introduced to satisfy the needs. Starlite is established in the 1970’s. It is one of the paper printing and packaging vendors that help to pack up hundreds of retail products for different companies. For the past decades, Starlite become one of the major packing service providers in Hong Kong. With the help of the information technology and developed transportation network in Hong Kong, its business not only limited to local services but all over the world. It has awarded Gracol G7 Master Printer and to be the first company obtains FOGRA Process Standard Offset (PSO) certification, FOGRA PSO and GMI – packaging printing standards in mainland China. Also it has GSV certification for the last 4 consecutive years.
The Starlite headquarter is located in Hong Kong, while the production line is placed in mainland China to lower the cost. The main role of Starlite is to turn different raw materials into packing boxes, containers etc. Products such as Catalogue & Pamphlet (OEM), Label - Plain / Printed , Paper (OEM), Printed Office Stationery ( e.g. Forms ) (OEM), Box & Case - Cardboard (OEM), Box & Case - Corrugated (OEM), Digital Printing, Offset Printing, Pad Printing. The majority is paper due to cost and other advantages, like the light weight, toughness and easy painting. On the other hand, plastics films are the secondary ingredient for packing, usually for protecting the painting as well as seal the new products. Depends on the nature of products, different kinds of design are custom made for customers or provided by them. There are two major rivals in this industry. They are Leo Paper Group and Hung Hing Printing which is similar in scale and share about 60% of the printing and packaging market with Starlite. The remaining 40% is divided by other middle and smaller companies.
Porter 5-forces Analysis Five Forces Analysis assumes that there are five important forces that determine competitive power in a
business situation. These are: 1) Supplier Power How easy it is for suppliers to drive up Starlite product prices. This is driven by the number of suppliers of each key input, the uniqueness of their product or service, their strength and control over the company, the cost of switching from one to another, and so on. The fewer the supplier choices you have, and the more you need suppliers' help, the more powerful its suppliers are. For Printing and Packaging Industry, Nine Dragons Paper (Holdings) Ltd, Lee & Man Paper Manufacturing Ltd, and other several small companies were mainly supplied on the paper source in the market. Fewer suppliers in market will be more easily to drive up the paper source prices. Thus, it means that Starlite needs suppliers’ great help in providing different types of paper in manufacturing paper packaging products. Besides, most of the printing machines are mainly coming from few suppliers (such as Kodak, Heidelberg, Roland and so on.) to provide technical support solutions in printing and packaging industry. By combining the above two points, that will be indicated high supplier power from Porter 5-forces analysis.
2) Buyer Power How easy it is for buyers to drive prices down on Starlite Printers Limited. That means it is driven by the number of buyers, the importance of each individual buyer to Starlite printing and packaging business, the cost to them of switching from Starlite whose products and services to those of someone else, and so on. If Starlite deals with few, powerful buyers, then they are often able to dictate terms to Starlite. In buyer power part from Porter 5-forces analysis tools, this is driven by the number of buyers, the importance of each individual buyer to Starlite, the cost to them of switching from Starlite products and services to those of someone else, and so on. Starlite mainly acts as Original Equipment Manufacturer (OEM) for its worldwide brand customers such as Hallmark Card, American Greetings Card, Penguin Books, and so on for their paper product production. If Starlite deal with few, powerful buyers, then they are often able to dictate terms to Starlite. Due to customers’ worldwide reputation, those bargaining power are relatively high in price negotiation to Starlite. Thus, buyer power to Starlite is quite high in the result. 3) Competitive competition The competitive competition force is high. The important thing is that Starlite has the number of competitors and the ability. If Starlite has many competitors, providing them with the same attractive products and
services, then Starlite probably have a small power, they will go elsewhere, because suppliers and buyers, If Starlite did not get a good agreement. On the other hand, if no one else can do STARLITE to do, Starlite can often have tremendous power. In fact, Starlite has listed on Hong Kong Stock Exchange (Stock Code No.403) since 1993. However, they are often facing the challenges from other listed competitors such as Hung Hing Printing Group Ltd.(Stock Code No.450), New Island Printers Ltd.(Stock Code No.377), and other small or middle size printing company in the market. Each of those are providing similar printing products and servicing. Thus, some huge buyers or consumers like Hallmark Cards (HK) Ltd. may separate their huge orders into small SKU (Stock Keeping Units) and divided to do production process in two or three printing companies. Thus, small bargaining power may be in result for Starlite in facing those buyers.
4) Threat of Substitution Threat of substitution force is low, Porter's threat of substitution definition is the availability of a product that the consumer can purchase instead of the industry’s product. Starlite and its competitors will be also faced large threat of substitution A substitute product is a product from another industry that offers similar benefits to the consumer as the product produced by the firms within the industry. According to Porter’s 5 forces, threat of substitutes shapes the competitive structure of an industry. As Green campaign is often promoted in nowadays, more and more printing paper outputs will be converted into electronics method presentation to the end users. For example, electronics books present very common on tablet computer such as Apple iPad or Samsung Galaxy Tab. Also, Christmas or Birthday cards will be substituted by sending electronics mails or mobile messages in people communications for above ten years. At the result, less physical paper will be used in the world in order to save Global resources.
5) Threat of New Entry For the threat of new entry, it is very low because this is also affected by the ability of people to enter to printing industrial market. If it costs little in time or money to enter the market and compete effectively, if there are few economies of scale in place, or if Starlite have little protection for its key technologies, then new competitors can quickly enter printing market and weaken its position. If you have strong and durable
barriers to entry, then you can preserve a favorable position and take fair advantage of it. Nowadays, as the printing industry becomes saturation, some of the huge size of printing company get rid of the printing business and move to other business. For example, Chung Tai Printing Co.Ltd (listed on Hong Kong Exchange Stock No. 055) changed their main printing business to entertainment business for three years ago. Also, Midas Printing Group Limited (listed on Hong Kong Exchange Stock No.1172) has also shifted their business to property area. The cost of barriers to entry in the printing company is to get more certificated in their products and services. Most of the certificates were required by the customers. Starlite fulfill the customer requirements to get an order. Thus, there will be less and less huge printing company retaining or medium or small business will enter to this industry.
SWOT Analysis SWOT analysis is a structured planning method used to evaluate the Strengths, Weaknesses, Opportunities, and Threats involved in a project or a business. 1) Strengths Starlite is one of the paper printing and packaging vendors that help to Pack up hundreds of retail product for different companies Provided deliver swift services, customized products, an innovative packaging solution and a multitude of manufacturing options for leading global clients Starlite production sites are located in places with the strongest economies and awarded Gracol G7 Master Printer and to be the first company obtains FOGRA Process Standard Offset (PSO) certification, FOGRA PSO and GMI Starlite decided the production line is placed in mainland China to decrease the cost and services distributed all over the world to increase the sales. Packaging and Printing Industry is a low cost of manufacturing. Starlite production line is placed in mainland. Therefore the salary of the labour is cheap. 2) Weaknesses Starlite are facing the challenges from others competitors and other small or middle size printing company in the market. Moreover the order system does not fit to Starlite operation needs. Printing Industry becomes
saturation because the industry shortage of technical labours and lack of technical adoption. Furthermore, the raw material price of printing industry is fluctuation. • • • Too many business ordered a limited number of jobs Invisible e.g. People don’t know all the products produced by the packaging and printing industry Increase the cost of production e.g. technology, speed, computers, order system, quality.
3) Opportunities Starlite need to develop IT field and new technology for increase the production quality • Market Development Assistance – Government provides assistance to approved associations, export houses and exporters in their overseas marketing activities • Technical assistance – The Industry Extension Centres provide Technical, economic and managerial consultancy service to small scale industries to improve the quality of goods produced and strengthen their competitive position in the market 4) Threats Starlite services distributed all over the world but it will face to the overseas competitors and local competitors. Printing Industry has been shrinking continuously. It is facing the challenges from new technology e.g. desktop printers and shortage the skills of the printing technology. The Green Movement does not agree more printing paper output, suggest electronics method presentation to the end users.
Application Portfolio Model for Starlite Printers Limited Strategic • • Sales forecasting/Market analysis (New Microsoft Navision ERP) Customer Relationship Management Software (eSAMs) High Potential • Product tracking/traceability (Old and New ERP system)
• •
Product database / Inventory Management (Microsoft Navision ERP) Enterprise Resources Planning (New Microsoft Navision ERP System) Order processing, Dispatch, Invoicing, etc. Production control Sales analysis Production Planning Purchasing-materials Costing system (activity and product) Sales analysis Warehouse Management
• • • • • •
Payroll and Personnel System Ledges – Payables and Receivables (New Microsoft Navision ERP System) General Ledger Office systems Purchasing - general Samples Management
Key Operation
Support
By the Application Portfolio Model, IS/ IT Starlite can be separated into four areas: (1) Strategic, (2) High Potential (3) Key Operation and (4) Support.
High potential (such as product tracking or traceability) It is a potential to play a pivotal role in the future business. The nature of this systems are includes tryout projects, and they are heavy on IT but short on actual business context. Their benefits are not obvious to perform in actual business contribution. Strategic (such as Forecast and CRM) These applications contribute strongly both to high value and strategic future plan. They sustain both the present and the future business of the organization. In order to ensure these applications address strategic goals, Starlite can use these applications through their business-oriented innovation. It provides effective and efficient business support. Also, it provides a tight vertical integration.
Key Operation (ERP system) Differ from Strategic; Key operation is just keeping the present business going. For example, Billing should be worked in reliable, efficient and secure. No risk should be taken in the main business direction. Key operation is often the legacy software in the organization. Support (Payroll or Personnel System) The most expensive operation, often whether the application can be effective. Payroll or HR administration
support non-differentiating business processes. These applications must be efficient and above all inexpensive in operation. New projects on these systems will usually only be undertaken when the organization is forced to make changes on account of statutory frameworks or compliance requirements.
Remarks for Terms: SEAMS – the name of Starlite old ERP system. It is mainly for using in normal production process and Inventory process before the implementation of new ERP system (Microsoft Navision ERP) in the past few years. From the old operations experiences, the old ERP system covers only in normal Key Operation or little in High Potential areas. Microsoft Navison ERP system – the system is a new ERP system in Starlite. The system covers modules includes: Financial, Costing (quotations), Sales, Material purchasing, Warehouse, Make-up and Manufacturing process. The main difference from the old ERP which can generate analysis report, sales and material forecast and estimate time in production planning. Thus, it can be covered into several areas on application portfolio model.
Create and sustain competitive advantage As the old ERP system modules cannot satisfy to all of the internal departments in their operations and cannot fit the current several years on company work flow. Thus, the new ERP system has been introduced for about three years which is parallel worked with the old ERP in the same time. Although there will be required an addition work on some of departments, it is zero risk on normal operation during changing a work flow with new ERP and providing integration of each departments’ operation. The system is new business processes to achieve the following expected value & interests: 1) To complete the integration of production and sales, procurement Unified information flow is not implemented in the current business units and production. After implementation the basic module of ERP, all countable data unit can be unified in matching in each operation and can be easily to pass to next step operator or other departments. 2) Maximum transparency between departments Optimize the coordination between the departments and the departments, making the operation of the business information between different departments to achieve the best. Document requires the authorized signature of the relevant departments of the transmission of information in different sectors. For example, if the premium customer has confirmed their order, the Account and Finance department will generate the credit limit related to that VIP customer. If the credit limit is failed, the system will have an email alert to the customer’s Account Manager and its Senior or
Sales Vice President to do settle payment action first. 3) Unified improve the basic data Specification supplier, customer information, the recognition of the various departments of the supplier, customer information, at the same time should be unified. The product of the data is scattered in various departments, leading to inconsistent data, there is duplication of coding. 4) To enhance the processing speed of the business processes Business information that can be tracked in real time (sales orders, purchase orders, production single status, etc.), and greatly improve the exchange of information between different departments. 5) Support real-time market decisions With real-time information, companies can quickly develop marketing strategies, and closer to the real, to reduce market risk. Past information and market trends will be very easy to view in the new system, to promote good enterprise further market decisions. 6) Reducing processes running costs With processing greatly reduce manual processes, information and data are passed through the system overall will reduce management costs. Operation control will become simpler, and human errors will be reduced to the minimum. After implementation new ERP system several months later, the past data and normal activities can be analysis to be a reference in order to do normal production planning. That can support for estimating the delivery product time and material resources well-prepared in operations. It can be save time and money at the result. 7) Maximize the value of employees Reduce the need to repeat the day-to-day operation of the time, so that employees can pay attention to the most valuable features (for example: to spend more time in the management order status and order analysis, rather than simply the New Order).
Protection and Security Information security means protecting information and information systems form unauthorized access, use, disclosure, disruption, modification, perusal, inspection recording and destruction. Nowadays, information
security problem is most important in the company, Starlite has developed seven methods to protect the company.
1) User Account Maintenance All user accounts should be removed immediately when the staffs leave the company. Periodic review on user accounts should also be conducted to ensure no obsolete account exists, and the user access rights are appropriately assigned. For the user account creation, amendment and deletion requests should be documented/email. Human Resources Department should prepare a list of leavers and forward it to the IT Department regularly. The IT Department should use the list to check if all the leavers’ accounts are removed.
2) Password Policy Commonly, people use four types of password distribution policies, one password everywhere, somewhatrandom password written down, patterned password or random stored password. So Starlite has a good password policy prepared for their staff. • • Maximum password age to 60 days to enforce user to change password every 60 days; Minimum password length to 8 characters to ensure that all passwords must comprise at least 8 characters; • Set minimum password age to 30 days to disallow user to change password within 30 days after a new password has been set; • • Enforce password history should be set to 10 passwords remembered in the system; and Passwords must meet complexity requirements should be set to enable.
3) Backup Procedure/Storage Backups are thought of in terms of the data that an organization relies on to conduct its daily operations. In recent years, some new are talking about the company lost the client information. So it proves a good backup plan should be developed. File server & Exchange should perform a full backup every weekend by using open file option. A daily snapshot should also be done every mid-night.
SQL server should backup the all the databases every mid-night System ghost should be made when possible. Backup tapes should be stored in a fire proof cabinet. The cabinet should also be locked and only authorized persons can access to the tapes. The cabinet should also be located away from server room.
4) Disaster Recovery Plan A Disaster Recovery Plan is a comprehensive, well thought out, and tested process document that maps out how to respond during disaster scenarios including events such as fires, floods, earthquakes or other disasters. The plan also addresses more mundane situations such as equipment failure, human error, theft, or other localized events. The DRP should be properly documented to facilitate the communication within the IT Department. A well planned DRP can minimise business interruption in the event of critical systems failures. In addition, drill test should be performed regularly to ensure the recovery procedures can be run smoothly in case of emergency. 5) Environmental and physical controls over the server room • • • • Smoke detector Temperature, humidity monitoring system Fire alarm Access control to the server room, such as password lock.
Keeping the server room organized is a critical priority: Less stress and better use of time: When everything is in its proper place, finding connections and performing maintenance is quicker and easier. That means fewer headaches, less wasted time and money savings. 6) Anti-Virus Definition Viruses exist on your computer through the email or internet commonly. Moreover it can spread from one computer to another through sharing of "infected" files. Common methods for spreading viruses include floppy disks, FTP file transfers, and copying files between shared network drives. So we need to install the antivirus software to protect our computer from viruses and remove any viruses that are found. • The auto-update function should be set and a regular check should be done once a week.
7) Routine Job Checklist • Checking Server log daily
• • • • •
Checking Citrix Management Control daily Checking server configuration weekly Checking backup log daily Checking firewall log twice a week Checking anti-virus definition once a week
However, no routine job checklist is in place to record the jobs done by IT staff. A routine job checklist can help the management to monitor the work done by IT staff; it can also enhance accountability as it would record the responsible persons. IT staff should sign off the checklist after they perform a job. The checklist should be reviewed by IT manager regularly to ensure all jobs were completed properly.
Success factors of Order System Depend on the comprehensive order system, Starlite become one of the major packing and printing services provided in Hong Kong. With the new ERP system, it can satisfy their operations and fit the company work flow. The new system can complete the integration of production and sales efficiently. All countable data unit can be unified in matching each operation and pass to next step operator or other department easily. Therefore, it improved the communication between the departments and the departments, making the operation of the business information between different departments to achieve the best. With reduced of manual processes, it can be save time and money at the result. As the old system, the product code has duplicated in various department, leading to inconsistent data. New ERP system rearranged the duplication of product coding. Specification supplier, customer information, the recognition of the various departments of the supplier, customer information, at the same time should be unified. Success factors of Security System Starlite developed a good security guideline for their staff to follow. E.g. Password policy is one of the security guideline which can teach a staff how to set the strong password in the computer. Backup storage also is important in the company. The company needs to backup the daily operation for the record or analysis. Then a good backup plan should be included. Because of the backup size, time and taps is most important in the backup storage. In the company, disaster recovery plan is a documented process or set of
procedures to recover and protect a business IT infrastructure in the event of a disaster. If the company has any disaster events includes fires, floods, earthquakes, equipment failure, human error and theft, it can return to disaster before. Moreover, Starlite designed a routine job checklist for the management and IT staff. It can monitor the job checklist to know the IT staff is it finishes the job. It is true that the security job should be complete. Therefore, starlite also provides a good environment and technology in the security system. A well-design server room and antivirus definition software should be included. The Printing Industry must keep checking the order of mail on every day. Viruses exist in your computer through the email way is most common. So the antivirus definition can protect your company which the hacker cannot attack the company.
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