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Monica Prakash ID#: 2241369 Infosys110

INFOSYS.110 BUSINESS COMPUTING: GROUP ASSIGNMENT DELIVERABLE 2 SUMMER SCHOOL 2014


Name NetID Group Number: Website Link: Tutorial Details Yvonne Hong Time Spent on Assignment: 25 hours Tues & Fri 2pm Monica Prakash mpra479 35 http://groupthirty-five.blogspot.co.nz/ Tutor: Day: Time:

Word Count: 1600

(excluding titles & in-text referencing)

Monica Prakash ID#: 2241369 Infosys110

SMART FRIDGE
Introduction
Each year, approximately 1.3 billion tonnes of consumable food is wasted or lost, this accounts for one third of the food produced (UNEP, 2009; FAO, 2011). Food wastage accounts for an economic loss of $750 billion annually (UN, 2013) and its effects extend environmentally. It results in a waste of resources, such that of water, land, energy, labour and capital. The food production processes require chemicals such as pesticides, fuel, as well as food expiration, all of which create higher levels of methane. Methane is one of the most harmful greenhouse gases that contributes to climate change, and is 23 times more potent than CO2 as a greenhouse gas. Therefore, food wastage has a high economic and environmental impact. When you regard the amount and impact of food wastage in relation to the number whom go hungry, 870 million people each day (FAO, 2012; World Hunger; 2013) it is evident that food wastage is a problem that needs to be solved.

3.0 Business Section 3.1 Vision Statement


To provide an innovative technology that creatively improves food wastage to help create a better world and richer experience for all.

3.2 Industry Analysis


Industry: Smart Fridge Force: Buyer power: High/Low: Low Justification: Buyer power is low because there are not many substitutes for this fridge. Consumers do not have the ability to negotiate price or require bulk quantities, and therefore buyer power is low (Porter, 1980) Supplier power is high because there is a limited amount of suppliers. For example, IBM account for 72% of the market share in relation to cloud storage systems (Wintergreen Research, 2010). Threat of new entrants is low because though market for smart fridges is yet to fully develop, it requires high capital investment and knowledge. There are a number of established brands with similar product and therefore this would not attract new entrants. Threat of substitutes is low, though there are ordinary fridges that can store food, none of which have a 2

Supplier power:

High

Threat of new entrants:

Low

Threat of substitutes:

Low

Monica Prakash ID#: 2241369 Infosys110

technological management system, therefore making it difficult to find a product that would perform a similar task of inventory system. Rivalry among competitors: existing High Rivalry among existing competitors are high because the existing competitors are credible and established such as Samsung and LG.

Overall attractiveness of the industry: Overall an attractive industry as there are not many suppliers of such technology, this idea expands and improves similar fridges in the smart fridge industry. Although entering the market would be difficult due to high cost, as well as high rivalry due to a number of reputable companies, once established this product could be highly successful.

3.3 Potential Customers and Their Needs


Consumers who would purchase this product are families who want to be economically efficient by saving money, as well as being resourceful. Products like this smart fridge are in need due to the amount of food being thrown straight from the fridge. This household issue can be seen in the UK, where households dispose the equivalent of 24 meals a month, totalling 4.2 million tonnes of consumable goods yearly (The Guardian, 2013). While in the USA, 30% of all food, worth US$48.3 billion is thrown away each year (UNEP, 2009; FAO, 2011). Therefore, in keeping in mind the purpose of the smart fridge, the customers needs would be satistifies, as its inventory system would aid in controlling and/or maintaing a habit of excessive food wastage. In the long run this product would decrease food wastage, as well as increase household income.

3.4 The Product and/or Service


This smart fridge provides a service to control, manage and assist food wastage via weight management system, inventory system (via barcode scanning and RFID) which connects to all members via application across all platforms. It will enable families and households to understand what they have, what they need and how these items can be used to its full potential (e.g. providing possible recipes with available goods). It will help in reducing costs, wastage, as well as providing families with an understanding of resource management.

3.5 Potential Suppliers and Partners


Smart fridge requires a cloud system, as well as data analysis system for the inventory and recipe database. Therefore, two suppliers selected are Microsoft and IBM. Microsoft will allow the information of fridged goods to be stored and analysed into reports providing members of the household with an inventory/stock list, with estimated expiration date and weight listed also. IBM will provide a cloud computing system which intergrates different technological devices with the processed information via Microsoft. Partnerships with Apple and Anroid will be created, as technological devices fall under Apple and Android. Therefore by creating such a partnership allows a system which is able to run on all devices to be produced.

3.6 Porters Generic Strategy: Differentiation


The competitive scope of the fridge industry is broad market, however the cost strategy of such a smart fridge would be high cost. It would be high cost because the knowledge and capital investment required to create such a product increases the total value of the good, making it high cost. The fridge industry is a broad market

Monica Prakash ID#: 2241369 Infosys110

as all in the developed world have a fridge, as do very few in developing nations. This product is not specifically target to a small and/or niche group. Therefore, the companys strategy is Differentiation.

3.7 Porters Value Chain Activity: Service after sale


The most significant value chain activity to this business would be, service after the sale. This would be most relevant because the technologies used to aid in resource management is an ongoing service that continues long after the product has been sold. The service provided by the smart fridge to the consumer allows for households to constantly receive help, understanding and therefore, overall satisfication with the product and the continuous service provided. As the product and the technologies required would be used on a daily basis, the consumer is likely to always benefit from this smart fridge. Through the strategy of differentiation, the vision of creating a richer experience and better world is met through this value chain activity, as it provides a service to the consumer long after the product has been bought by cutting costs and food wastage.

3.8 Key Business Processes


Business Process 1: Resource Management Process Consumer is able to understand what they have in their fridge, the amounts of each item and the estimated expiration date. It will therefore allow for efficient resource management and planning. It starts with consumer approaching fridge and scanning barcode of goods (and/or manually entering fresh produce), allowing for the resource management system to begin. At a later stage, if the consumer wants to see what is in their fridge they can check the system which will provide amounts, expiration dates and most importantly, available goods, allowing for better planning and management of present goods.
START Scan/RFID Tag Input Goods Inventory System

Decision

Buy Goods

Dont Buy Goods Inventory System

(Re)input Goods

DONE

Business Process 2: Data Sharing Process Consumer is able to understand what they have in their fridge without being in the household. Through application across both android and apple platforms, the consumer can link their fridge inventory to the application, which allows for more efficient shopping as they will know what they have and how much they need, etc. This process starts by linking the application and inventory via cloud management system. When the consumer goes shopping, they can check the application to see what is in their fridge, e.g. milk and the quantity, e.g. 100ml, this will allow for them to understand if they need more milk, e.g. 100ml for 4 people is insufficient, must purchase more. It allows for better planning aiding an overall more satisfied experience. 4

Monica Prakash ID#: 2241369 Infosys110

START

Input Goods Weight Management System Decision

Inventory System

Buy Goods

Dont Buy Goods DONE

3.9 Functionalities
3.9.1. Resource Management Process 1. 2. Display items available (and therefore what is required) The amount (in weight) of each good and expected expiration date

3.9.2. Data Sharing Process 1. 2. Allows for information about goods to be shared amongst households Allows for better decision making

3.10 Systems
System 1: Inventory System Allows for data entry of goods in the fridge via scanning and RFID tags, for pacakaged goods such as milk, or manual entry for goods such as produce. Once entered into system, they are placed in individual holding containers where the inventory system will measure the good (weight) via a weight management system (see system 2), as well as predict an appropriate expiration date based on type of good. Allows for consumer to know what goods they have and what they need. System 2: Weight Management System The weight management system aids in the inventory system by allowing for a specific weight for a specific type of good to be known by being measured once placed in individual holding container, after entered into system. Allows for the consumer to know if more of a certain good is required or not. System 2: Cloud Management System Allows for information of goods to be available to all household members through the use of a cloud managmetn system. Knowledge of goods can be shared beyond the household itself, allowing for better understanding and planning when grocery shopping (ability to see what is available, how much is available and expiration date). 3.11. SUMMARY TABLE: VALUE CHAIN TO SYSTEMS

3.11 Summary Table: Value Chain to Systems

Monica Prakash ID#: 2241369 Infosys110

Value Chain Activity 1. Service After Sale

Processes Resource management process 1.

Functionalities Display items available (and therefore what is required)

Specific Information System(s) Inventory system

Broad Information System(s) Collaboration Inventory System

2.

2.

Data Sharing Process

1.

Allows for amount (in weight) of each good and expected expiration date to be known Allows for information about goods to be shared amongst households Allows for better decision making

Weight management system

Enterprise Resource Planning system

Imventory System

Collaboration Inventory System

2.

Cloud managment system

Decision Support System

4.0 Conclusion
In conclusion, the smart fridge is a technological solution to the issue of food wastage. Its overall attractiveness as an industry is high, as once established it would become a good everyday way for families to reduce costs and be resourceful. Through the use of information systems and technology, the smart fridge is able to do an automatic inventory allowing for convenience and an overall better experience for the consumer.

Reference List
1. Food and Agriculture Organisation of the United Nations (FAO) (2011) Global Food Losses and Food Waste. Retrieved from http://www.fao.org/docrep/014/mb060e/mb060e00.pdf Porter, M. E. (1980). Industry Structure and Competitive Strategy: Keys to Profitability. Financial Analysts Journal, 36(4), 30-41. Smithers, R. (2013). Food waste report shows UK families throw away 24 meals a month. The Guardian. Retrieved from http://www.theguardian.com/environment/2013/nov/07/uk-householdsfood-waste United Nations (UN) (2013) UN report: one-third of worlds food wasted annually, at great economic, environmental cost. Retrieved from http://www.un.org/apps/news/story.asp/h%3Cspan%20class=%27pullme%27%3EIn%20short,%20wh en%20you%20empower%20a%20woman,%20you%20change%20the%20world%3C/span%3Ettp:/ww w.unfpa.org/www.fao.org/html/html/story.asp?NewsID=45816&Cr=food+security&Cr1=#.UtnkDRCBr IU 6

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Monica Prakash ID#: 2241369 Infosys110

5.

United Nations Environment Programme (UENP) (n.d.). Food Waste Facts. Retrieved from http://www.unep.org/wed/quickfacts/ United Nations Environment Programme (UENP) (2009) The environmental crisis: The environments role in averting future food crisis. Retrieved from http://www.unep-wcmc.org/environmental-foodcrisis_62.html Winter Green Research. (2010) Cloud Computing Virtualization Market Strategies, Shares, and Forecasts, Worldwide, 2010-2016. United States: Winter Green Research World Hunger Education Service (2013) 2013 World Hunger and Poverty Facts and Statistics. Retrieved from http://www.worldhunger.org/articles/Learn/world%20hunger%20facts%202002.htm

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