IT Investment Exercise

1.    Strategic Assessment

a.     Competitors – Excel Emailed

b.     SWOT – Excel emailed

c.      5 Forces  - Excel emailed

d.     Montclair Computer is a small local company. It seems as if though they only offer a limited amount of products.  Product differentiation would be a great generic strategy because it would offer potential revenue growth in addition to attracting a broader market segment and demographics.

2.    Strategy Analysis of Options

a.     It could be argues that either of the proposed options overpowers the other in terms of significance to company well-being and growth.  It is clear that Internet sales paired with the product diversification strategy, success for this company can provide a potential booming growth. The second option that includes postponing the website and implementing an ERP. This option is surely a great one and would provide large value in the business model that a company the size of MC needs at their current state.

b.     Benefits and drawbacks

                                               i.     Online Store

1.     Benefits

a.      Broader market segment

b.     Increased sales

c.      Possible strategy to diversify products to increase product listing

2.     Drawbacks

a.     Difficult to gain recognition against competitors

b.     Entry into large player market is difficult

c.      Must improve their departments before moving forward to have full and accurate information to run smoothly.

                                              ii.     ERP

1.     Benefits

a.     Finance, manufacturing, and customer relationship mgmt will help CM gain a competitive edge over competition.

2.     Drawbacks

a.     2 year minimum implementation

b.     High cost investment

c.      Based on the above analysis I would recommend for MC to first create a website based off the estimated time frame. It would only take several months to create and implement in addition to being a very cheap investment relative to that of the ERP. Once the Website is up and running, they could work on tweaking the options as they begin the ERP implementation process.

d.     My overall recommendation remains the same as before. I think the best way to reap the cost benefits is by first implementing a web site. The investment analysis further upholds my previous decision. We could see that the ROI and NPV are greater for project 1.  Once the website is running, the ERP project will come next in line to help expand this wonderful company.

3.     Schedule Analysis

a.     See below Charts

b.     The critical path I ran was in the 2 year time frame.

c.      E2 was not in the critical path of the project so it is OK to delay some time without delaying the project as a whole.

d.     E1 is in the critical path so it was not OK to delay this project more then a few days without compromising the expected time frame.

4.     Investment Analysis

a.     See spreadsheet

b.     See spreadsheet