Information System in Traditional Chinese Herbal Tea Industry Project Proposal

1. Information System in Traditional Chinese Herbal Tea IndustryProject Proposal Module Name: Strategic Management and Information Systems Module Code: BIS3324 Module Tutor: Alan Kwong Prepared By : Raymond Tse Chu Hin Chung, Samuel M00501664 Jemy Wong Ka Lun, Alan M00501672 Prepared On : 21th Mar 2014 Group : 2

2. Nowadays Information systems is most critical strategy in the business world which allow for business expansion and increase the competitiveness of a business. To overcome the business competition, understand the customer favors and makes them like the product is very important mission. Information system are applications such as CRM, POS, ERP…ETC. The object of our investigation is local traditional herbal tea company “Hung Fuk Tong Holding”. We will elaborate how’s the strategy management determinate the IT system to make use with business. Introduction

3. This report is to review its market strategy by using ‘Porter Five Forces’ and to find out the strength and weakness from its existing business model. Hence, the results of findings will be used to analysis whether ‘Information System’ could make significant improvement on its market strategy. We will adopt the research methodology to overcome the market competition. With the references of IT Department’s interview, customers survey, collections of company’s information, these are the methodologies used to fulfill the preparation works for delivery of ‘Porter Five Forces’. Objective

4. In order to obtain the information about company’s situation accurately by following methods: Interview - Carry out a Company Interview with HFT’s CEO Mr. Ricky Szeto. On-site visit and interview with IT department, obtains a chance to work with I.T. department in a 4-day on-site workshop. . Consumer Survey - Firstly via the google surveys web tools to setup and send out the consumer survey to HFT members email and post it on most popular internet discuss forum to wait for feedback. Porter Five Forces – To analysis the company’s strengths, weaknesses, opportunities, and threats can be revealed from its results of findings. Methodology of Study

5. Question in the Survey (1) How much do you spend on “Hung Fuk Tong” per month? (2) How often do you visit “Hung Fuk Tong” ? (3)Will you use a mobile apps to obtain the information of “Hung Fuk Tong” ? Porter Five analysis . Rivalry Among Competing Firms in Industry Pressure Rate: Lower 28 Years’ experience on produce traditional Chinese herbal drink, have large market share. HFT has strong product sale distribute network, such as MTR, KCR, supermarket & convenience stores. HFT had investing a large money on TV and other advertising in order to maintain their market share. II. Threat of New Entrants Pressure Rate: Lower New entrant need large number of investment and time to build up their brand and customer base. HFT have well developed business model and market strategy. Threat of Substitute Products Pressure Rate: Middle No secret formula for making traditional herbal drink, people can replicate easily. HFT concerns on their customer needs, thus they always improves their products. People likes to have healthful food and drink, therefore Traditional Chinese herbal drink can’t be replaced by other soft drinks. Data Gathering and Analysis

6. Data Gathering and Analysis IV. Bargaining Power of Suppliers Pressure Rate: Lower HFT can have larger number of order for suppliers. Multi source suppliers from different counties and locations. Bargaining Power of Buyers Pressure Rate: High Consumer easy to change their favorites . More then one Traditional herbal drink brand name selling in the market. High quality requires by current customer. HFT have own executive selling channel.

7. The below table is showing the information requirement of HFT. Information Requirements

8. The new methods will be enabled by the new proposed I.T. systems i) Instant Order@ E-coupon ii) Smart E-order Strategic IT System(s)

9. Instant Order@E-coupon Instant E-coupon is a strategy planning to absorb the potential market from social media networks. Social media networks have become a dominant force of almost every aspect of a person’s communication strategy. Businesses are remaining competitive by reaching their customers through social media networking. With effective management practices and low cost social media marketing, businesses have been able to use inexpensive ways to increase their visibility online. The extreme growth of social media has also assisted businesses in tapping into previously unknown markets. Strategic IT System(s)

10. Smart E-order Smart E-order is one another strategy planning in ‘CRM system’ to increase interactive relationship between customers and the company. This new system enables the selling process visible to the company’s management system and have critical decision making process to project the needs on future purchase order of raw material CRM systems give businesses the ability to personalize and customize relationships with their customers regardless of which employee deals directly with them at any given time. Strategic IT System(s)

11. Evaluation had been reviewed on our existing I.T. System Requested I.T. proposal on the 2 new systems At this stage, we decided to develop the (Smart E-order) by our existing I.T. project team and outsource the development to (Instant Order@E-coupon) I.T. Project Strategy

12. Change management - Based on “Hung Fook Tong” experience, at the beginning they need to early inform the staff for the system change training about the social network media and CRM integration. Risk Management - Hung Fook Tong might face 2 major problems, one is system technical and other is Cost. Project Implementation Strategy Overview

13. Cost and Benefit Analysis

14. Show by Graphic? Cost and Benefit Analysis

15. The new system will increase extra budget to “Hung Fuk Tong” and cost of implementation planned will be estimated in the project proposal. For the new system, product details including descriptions of products, quantities, and individual unit price will be quoted before the implementation stage. In view of the system stability, the ongoing maintenance cost and staff training fund will be estimated as well. Conclusion

16. Q & A

17. Thank you!