Can Information Systems Restore Profitability to Restoration Hardware?

782 Words May 12th, 2008 4 Pages
1. Evaluate Restoration Hardware using the value chain and competitive forces models. How is the company responding to the forces that influence it?

Potential Entrants: Threat of new entrants is high because there are already many in the industry so it is obviously easy to enter.

Industry Competitors: Rivalry among existing firms is high. Pottery Barn, Pier 1, and Williams Sonoma are a few. Competitors have greater financial, marketing, and operational resources.

Substitutes: Threat of substitute products or service is high. Same types of products can be found in specialty stores, traditional furniture stores, and department stores.

Suppliers: Bargaining power of suppliers is extremely high. Two vendors were the source of
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Management is made up of individuals with merchandising backgrounds - they may be weak in understanding a complex business environment that is vulnerable to a host of trends, restrictions, and abnormalities.

Organization – due to the large number of customers, suppliers, and inventory product line, management must be committed to getting the same data to everyone at the same time. The biggest issue appears to be accurate and reliable data as it pertains to inventory levels, products in demand products, delivery times, etc.

Technology – the technical issues consist of designing a CRM system that can integrate all of the processes into one seamless system. Their reposition strategy did not address improvements to the company’s aging information technology infrastructure. This technology must be updated in order to realize benefits of a CRM system.

4. What role does supply chain management play at Restoration Hardware?

Supply chain management would play a vital role at Restoration Hardware. As stated in the case, they need to study their management, improve and increase its product line, improve customer service, enhance its presentation of merchandise, and maintain competitive pricing and retail locations. These processes could be well supported through the implementation of a supply chain

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