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Chapter 3 Information Systems, Organizations, and Strategy 135

much information was available on each screen of sensitive customer data and to provide robust
the interface, so Ford moved the most commonly privacy options. On the other hand, automak-
used features to more prominent ers are hoping that younger customers who have
positions on screen and increased their font size, grown up using Facebook are less likely to care
relegating the rest to submenus. Feedback has been about privacy, and features that collect highly
positive. Ford has also asked dealers to dedicate targeted information about a car’s location and
more time and personnel to hands-on technology driving habits.
training to help customers master its interface. BMW is also investing a whopping $100 million
GM, Daimler, and other companies are all in mobile apps, hoping to market them to their
developing new features for their cars that operate customers as “premium services.” Some analysts
online in the cloud. Users will be able to remotely are skeptical of the decision to invest that much
track their cars (you’ll never forget where you money, but BMW believes that mobile apps will
parked again) and diagnose problems with the car, become an increasingly attractive selling point for
like low tire pressure or the need for an oil change. customers of its BMWi electric and hybrid cars.
Corporations will be able to track employee use Although the future of cars sharing information
of company cars by interpreting car sensors and with other nearby cars is still years away, automak-
engine readouts. Manufacturers will be able to ers are excited by the possibilities afforded by smart
aggregate and analyze the data from customers’ software and apps.
cars to identify quality problems and, if neces- Sources: Ian Sherr, “Cars Pump Up IQ To Get Edge,” The Wall
sary, quickly issue recalls. Just as with apps, the Street Journal, January 13, 2012; Chris Murphy, “4 Ways Ford Is
possibilities are limited only by the imagination of Exploring Next-Gen Car Tech,” Information Week, July 27, 2012;
Mike Ramsey, “Avoiding Gridlock with Smart Autos,” The Wall
automakers.
Street Journal, February 27, 2012; Joseph B. White, “New Driver’s
GM will allow its app developers to access Ed: Tutors to Decode High-Tech Dashboards,” The Wall Street
its computer systems to improve app function, Journal, May 8, 2012; Chris Murphy, “Ford is Now a Software
Company,” Information Week, November 28, 2011 and “Why BMW
which raises a familiar set of privacy concerns.
Suddenly Loves Mobile Apps,” Information Week, March 2, 2011;
Auto analysts believe that automakers will make and Chuck Squatriglia, “Ford Brings SmartPhone Apps to Your
mistakes as they learn how to properly handle Dashboard,” Wired, April 20, 2010.

CASE STUDY QUESTIONS

1. How is software adding value to automakers’ 3. What value chain activities are involved in
products? enhancing cars with software?
2. How are the automakers benefiting from 4. How much of a competitive advantage is software
software-enhanced cars? How are customers providing for automakers? Explain your answer.
benefiting?

• Make it easy for suppliers to display goods and open stores on the Amazon
site
• Make it easy for customers to pay for goods
• Develop systems that coordinate the shipment of goods to customers
• Develop shipment tracking systems for customers
Internet technology has made it possible to create highly synchronized
industry value chains called value webs. A value web is a collection of
independent firms that use information technology to coordinate their value
chains to produce a product or service for a market collectively. It is more
customer driven and operates in a less linear fashion than the traditional
value chain.

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