University Report: Understanding Information Systems at Woolworths

This report provides an analysis of Woolworths' information systems, addressing the assignment brief's requirements. It begins by examining the application of Porter's Five Forces to Woolworths, assessing the intensity of competition, threats from new entrants and substitutes, and the bargaining power of buyers and suppliers. The report then explores how Woolworths can leverage IT to respond to these forces, focusing on customer databases, accounting processes, and inventory management. Furthermore, the report identifies organizations like Disney and Telstra, which have gained competitive advantages through strategic use of Information Systems. Finally, the report outlines activities, such as analyzing customer sales history and sentiment, that can be carried out to achieve similar advantages, focusing on value chain components and changing retail value perception. The report includes cited references from sources like Woolworths.com.au and Actuaries.digital.

Running head: UNDERSTANDING INFORMATION SYSTEMS AT
WOOLWORTHS
Understanding Information Systems at Woolworths
(Woolworths Supermarkets)
Name of the student:
Name of the university:
Author Note

1UNDERSTANDING INFORMATION SYSTEMS AT WOOLWORTHS
1. Porters Five Forces affecting Woolworths:
1.1 Determination of Impact on Woolworths
Intensity of competition:
Woolworths have about 35% share in market. However, the rise in share for the competitor
organizations as increased to 62.9 million from various operations.
Threat from new entrants:
There is a necessity of high capital for entering market. Besides, the cost of production is also
greater.
Bargaining power of buyers:
They are facing high competition from lesser costs from Aldi and Coles giving bargaining
power to buyers. Moreover, there are also product consideration making the switching costs greater
weakening bargaining force.
Bargaining power of suppliers:
Products delivered by various suppliers have no or less substitutes making the position
effective.
Threat of substitute products:
The limited amount of substitute products are making the cost of buyers weak and less
threats for the substitutes (Woolworths.com.au, 2020).

2UNDERSTANDING INFORMATION SYSTEMS AT WOOLWORTHS
Each of these above-mentioned forces has immense impact on the organization, since they
are facing high competition in the market. The strategy suits to the competitive environment and
even improves their potential profit.
1.2 Usage of IT for responding to the Forces
Woolworths can use IT for responding to every force. They would be able to deal with high
competition easily by inclusion of customer databases. As a result, communication would be
improved and customer relationships would be managed. As a result, buyer power would be
enhanced and competitive advantages would be gained. Moreover, Woolworths would be able to
enhance their accounting processes and record various financial documents. They would be able to
improve inventory management; hence supplier power would be enhanced.
2. Gaining competitive advantage through Information Systems:
2.1 Identification of Organizations that have become popular by adopting Competitive
Strategy for gaining Advantage
Using IS with different customers: This can be understood from the example of Disney. They
implemented a system with artificial intelligence that collects electronic data from different CCTV
and then provide information to customers and visitors. Apart from that, its SMS system warns
customers regarding various kinds of latest discounts, products or events. Communication is
increased for the organizations. Another popular organization that has gained advantage from
competitive strategy is Telstra. Being a telecommunications organization, it was required for them to
ensure availability and better communication.

3UNDERSTANDING INFORMATION SYSTEMS AT WOOLWORTHS
2.2 Activities to be carried out for achieving advantage
There are many activities that it carries to gain the benefits like it concentrates on presenting
online products to consumer on the basis of sales history. This is related to various value chain
components or changing the retail value perception through adding various dimensions like
suggestions with undertaking sentimental assessment and the change in trends for coming up with
relevant searches (Actuaries.digital, 2020). The major activities also include different primary
activities, such as inbound logistics, operations, service and marketing and sales.

4UNDERSTANDING INFORMATION SYSTEMS AT WOOLWORTHS
References:
Actuaries.digital. (2020). How artificial intelligence is changing retail value perception - How
artificial intelligence is changing retail value perception | Actuaries Digital. [online]
Available at: https://www.actuaries.digital/2018/01/11/how-artificial-intelligence-is-
changing-retail-value-perception/ [Accessed 7 Mar. 2020].
Woolworths.com.au. (2020). Woolworths Supermarket - Buy Groceries Online. [online] Available
at: https://www.woolworths.com.au/ [Accessed 7 Mar. 2020].