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Internet and the Economy

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ianaizman

This document discusses how the internet has impacted the global economy through outsourcing, offshoring, and supply chain management. It provides examples of how companies like Walmart use internet-enabled supply chain strategies to cut costs and gain competitive advantages. The document also presents a classroom game to simulate how small businesses compete in this environment against large retailers that can leverage these global sourcing and distribution strategies.

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Internet and the economyIan Aizman, Peter Fuller, Katie Sangster, Linda Yang
Internet and the Economy
OutsourcingFiber optic cablesNetscape creation- 1996Y2Khttp://www.youtube.com/watch?v=9yVbcWX2lV8
OffshoringAnother version of outsourcingFactories placed in different countriesIndiaEase of the InternetChinaJob LossesMidwest
Supply-ChainingMethod of collaborating horizontally among suppliers, retailers, and customers to create value.It is the constant flow of delivery, sorting, packing, distribution, buying, manufacturing, reordering, delivery, sorting, packingCompetitive advantage.Best example
Internet and the Economy
Wal-MartBiggest retail company in the world.Works with manufacturers to cut costs as much as possible.Constantly updates information systems.Ability to redirect products.Distribution centers are KEY.RFID: Radio frequency identification microchip.
The Game of Small Business
4 GroupsGroup 1: GigandoMart (exec. Decision maker)Group 2: Bobs Corner Shirt Store (exec.)Group 3: Purchasing Public (everyone for themselves)Group 4: Split into two sub-groups manufacturer and middle man (each with exec.)
Group 1: Gigando MartStarts with $10,000Can buy from middle man or directly from manufacturerSell price for shirts in $3/unitGOAL: Make as much money buying/selling shirts as possible before time runs out (5minutes)
Group 2: Bobs Corner Shirt StoreStarts with $50Must buy from middle manSell price for shirts is $5GOAL: Make as much money buying/selling shirts as possible before time runs out (5 minutes)
Group 3: Purchasing PublicEach person in the group has a computer from which they can buy shirts from either GigandoMart of Bobs.GOAL: To buy as many shirts for as little money as possible before time runs out (5 minutes)
Group 4: Manufacturer/ Middle manManufacturer: sells shirts for $1Middle man: sells shirts for $3
AfterwardRe-group and talk about how the game played out.How did GigandoMart fare?Bobs Corner Shirt Store?Why do you think it played out this way?Did Bobs Corner Shirt Store stand a chance? Why or why not?How do you think the Internet played into this?http://www.youtube.com/watch?v=d8nxYhS7310

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Internet and the Economy

  • 1. Internet and the economyIan Aizman, Peter Fuller, Katie Sangster, Linda Yang
  • 3. OutsourcingFiber optic cablesNetscape creation- 1996Y2Khttp://www.youtube.com/watch?v=9yVbcWX2lV8
  • 4. OffshoringAnother version of outsourcingFactories placed in different countriesIndiaEase of the InternetChinaJob LossesMidwest
  • 5. Supply-ChainingMethod of collaborating horizontally among suppliers, retailers, and customers to create value.It is the constant flow of delivery, sorting, packing, distribution, buying, manufacturing, reordering, delivery, sorting, packingCompetitive advantage.Best example
  • 7. Wal-MartBiggest retail company in the world.Works with manufacturers to cut costs as much as possible.Constantly updates information systems.Ability to redirect products.Distribution centers are KEY.RFID: Radio frequency identification microchip.
  • 8. The Game of Small Business
  • 9. 4 GroupsGroup 1: GigandoMart (exec. Decision maker)Group 2: Bobs Corner Shirt Store (exec.)Group 3: Purchasing Public (everyone for themselves)Group 4: Split into two sub-groups manufacturer and middle man (each with exec.)
  • 10. Group 1: Gigando MartStarts with $10,000Can buy from middle man or directly from manufacturerSell price for shirts in $3/unitGOAL: Make as much money buying/selling shirts as possible before time runs out (5minutes)
  • 11. Group 2: Bobs Corner Shirt StoreStarts with $50Must buy from middle manSell price for shirts is $5GOAL: Make as much money buying/selling shirts as possible before time runs out (5 minutes)
  • 12. Group 3: Purchasing PublicEach person in the group has a computer from which they can buy shirts from either GigandoMart of Bobs.GOAL: To buy as many shirts for as little money as possible before time runs out (5 minutes)
  • 13. Group 4: Manufacturer/ Middle manManufacturer: sells shirts for $1Middle man: sells shirts for $3
  • 14. AfterwardRe-group and talk about how the game played out.How did GigandoMart fare?Bobs Corner Shirt Store?Why do you think it played out this way?Did Bobs Corner Shirt Store stand a chance? Why or why not?How do you think the Internet played into this?http://www.youtube.com/watch?v=d8nxYhS7310