Document Engineering & Information Architecture (INFO 243)

Assignment 3: Business Patterns

Author(s):
Bob Glushko
glushko@ischool.berkeley.edu

Course: Document Engineering & Information Architecture (INFO 243)
Date: 28 February 2007; due on 9 March
Title: Assignment 3: Business Patterns
The purpose of this assignment is to test your understanding of the patterns for business models, business processes, and document exchange.

There are 16 questions in this assignment. Books might be written to answer answer some of these questions, BUT YOUR ANSWERS DO NOT NEED TO BE MORE THAN 100-200 WORDS, AND SOME CAN BE ADEQUATELY ANSWERED USING MANY FEWER WORDS. I have itemized every question this way to make it easier on you (so you'll focus on each question and won't accidentally skip some) and to make it easier for us to grade your assignments. Your work should include the section titles and should number each answer, just as the questions are.

Some of the questions have objectively correct answers, while others can be argued in more than one way. Your thinking will almost certainly be more focused and your answers sharper if you refer back to your lecture notes and to the pattern resources you have explored in the Pattern Scavenger Hunt and in assigned readings.

Please submit your work in electronic format using the upload link on the course syllabus page before 6pm PST on Friday March 9.

For decades, Sears was a successful company that "did it all" -- it had its own retail outlets, warehouses, credit department, and delivery service. The drop shipment pattern used by many Internet retailers decomposes these four functions of the physical enterprise into business components or services, and in the "virtual business" created via document choreography (exemplified by GMBooks of Chapter 1 of the Document Engineering text) each of these services is performed by a different business.

(Q1) The drop shipment virtual enterprise is "glued together" by overlapping information components that are contained in the different documents produced and consumed by the various service providers. Describe three of these components and their role in the choreography of drop shipment.

(Q2) If drop shipment retailers are following the same pattern and they are relying on other firms to carry out crucial processes, how can they differentiate themselves to create competitive advantage?

Most manufactured products are sold "indirect" -- through distribution channels -- because this vastly multiplies the ability of a firm to reach customers. Furthermore, some products are inherently difficult to sell, install, customize, and support, and these activities are often best done by someone other than the manufacturer. But this creates information asymmetries about products, who buys them, and how they are used -- i.e, the manufacturer and its channel partners don't have the same information or have different amounts of it. This situation often tempts a manufacturer to try to sell its products through BOTH direct and indirect channels, which can lead to "channel conflict."

(Q3) What information does the manufacturer have that the channel doesn't have? What information does the channel have that the manufacturer doesn't have?

It is more costly to a retailer to run out of a product than to carry excess inventory, but when this principle is followed in a myopic manner bad things happen like the "Bullwhip Effect." The "Bullwhip Effect" in supply chains is the magnification of demand variability as it moves up a supply chain. As demand for a product filters back up the chain from the consumer toward the original source of the component raw materials, that demand becomes more and more erratic and swings in larger and large cycles. Read the two-page article that summarizes the classic paper on the Bullwhip Effect at http://courses.ischool.berkeley.edu/i243/s07/assignments/A3-BusinessPatterns/bullwhip.html and then answer these questions:

(Q4) What kinds of information exchanges can best reduce the Bullwhip Effect?

(Q5) Can the Bullwhip Effect be completely eliminated?

As an Internet retailer, you know that you make most of your money around Christmas, so you want to promise delivery by Christmas and thereby sell more online to procrastinators, who spend more than people who shop early. You think you are better at supply chain management than your less efficient competitors, so you offer a later "you'll still get it by Christmas" date.

(Q6) What business processes / document exchanges in your information supply chain are key to being able to promise delivery?

(Q7) Where you can, identify RosettaNet PIPs or UBL documents that could serve as reference model for your information supply chain.

The next few questions require you to read and interpret a short news story called "Driving Standards" that appeared in Information Week at http://www.informationweek.com/story/showArticle.jhtml?articleID=18201098

(Q8) If this project proceeds as planned, what companies / parties will be able to exchange information with each other?

(Q9) What types of documents will be exchanged? (Some are mentioned explicitly, and others are implied in the article.)

(Q10) What are the business benefits for the participants?

(Q11) What are the business or technical risks?

(Q12) For an established firm with many existing business relationships, is a new technology for information exchange (e.g., the Internet, RFID, satellites,...) likely to change its modes of exchange or reinforce them?

(Q13) How does the mode of exchange shape the extent and nature of information exchange between the parties in a business relationship? For example, does "voice" mode imply more information exchange?

In 2002 there was a highly-visible local news event of global importance when many ports, including the Port of Oakland, were completely shut down for 10 days, disrupting the supply chains in many industries. (Read about it at http://money.cnn.com/2002/10/09/technology/techinvestor/hellweg/ or http://www.labournet.de/internationales/usa/waterfront-db.html -- you can easily find more articles on the web if you are more curious.)

(Q14) Describe the relationship between the port operators and the union workers using the dimensions of the "Exit vs Voice" pattern. Illustrate your answer with some facts from web articles.

(Q15) Many standards for information components and documents come from formal standards processes, and this has been described as "boring, political, time-consuming, unglamorous, irritating work." What's the best argument for developing a new XML vocabulary according to a formal process? What's the best argument for NOT developing a new XML vocabulary and reusing an existing one?

(Q16) The "microformats" movement represents a very different approach to solving interoperability problems. Compare and contrast how microformats are created with formal standards processes for creating XML vocabularies like those in OASIS.