Kindle and iPad, for example, are restructuring industries and their value chains. The e-book revolution is upon us, much like the e-music revolution of past years.  For example, one New England boarding school, Cushing Academy, found that only about 0.15 percent of its library books were circulated.  So, they now are eliminating printed books and use 65 Kindle ebooks in the library.  “It is really to save libraries five, ten, fifteen years down the road,” noted a school library manager.  “What the students are telling us is, ‘We’re not using the print books.  You can keep giving them to us, but they’re just going to collect dust.’ You can search the Web for such information and stories.

1. Suppliers (for raw material)

   • trees -> paper

   • ink

   • authors, editors, designers, marketers

2. Manufacturer

3. Distribution

4. Retail stores

5. Customers

Advantages of having bricks and mortar chain

• create more job opportunities for everyone

• experience from the customer's perspective is different

• easier to control the bricks and mortar chain (easier to catch if people copy our work)

• face-to-face with customers

Disadvantages

• costly because need to print and pay more people to produce it

• license

• time-consuming, have to go to physical stores to buy the book

• not environmentally friendly, cause have to use more materials to print the book

Process for e-book (only 3 steps)

1. Suppliers

   • authors, marketing, editors

   • art design

2. Internet distributors

   • amazon, publishes, ebooks

3. Customers

   • novels, textbooks, self help

Advantage of e-books

• more accessible and convenient for customers

• cheaper

• portability (can download multiple e-books on the same device)

• improve the reading experience (can highly freely on the device)

Disadvantage

• easily accessed by other people if the internet is not protected

• cause eye strain

• the battery may run out

• lacking textile experience

Compare and contrast internet-based value-chain design and structure from customer and management viewpoints

customer viewpoint:

• more convenient, require less energy to obtain the book

• more customizable (can just download the chapters you want instead of buying the whole book)

• more affordable

management viewpoint:

• simpler process/procedure (can solely focus on the marketing aspect instead of the printing aspect)

• no need to worry about transportation, storage, etc

• can track and analyze their users/readers (they can see the customers' demographic and cater similar books to them to sell more)

disadvantages of internet-based value chain

• hard to protect the author's intellectual properties (IP)

  -> encryption

Q4. what is the role of operations in each of these value chain designs and structures (10)

BRICKS AND MORTAR

1. Design of goods and services

   • design cover

2. Managing quality

   • must maintain the quality

3. Process and capacity design

4. Location strategy

   • 
     

5. Layout strategy

6. Human resources and job design

7. Supply chain management

8. Inventory management

9. Scheduling

   • scheduling delivery trucks and retail store

10. Maintenance

    • must maintain the printing equipment is under good condition to prevent and defects and delays

E-BOOK

1. Design of goods and services

   • design cover

2. Managing quality

   • how good the app interface is

   • making sure customers can easily download the book

3. Process and capacity design

4. Location strategy

   • 
     

5. Layout strategy

6. Human resources and job design

7. Supply chain management

8. Inventory management

9. Scheduling

10. Maintenance

2. variety

   product variety:

   • small items (utensils, lights)

   • large items (sofa, tables)

     
     

     service variety

   • 
     

Q2 challenges

• need to keep up with the trend

• self-service (customers have to assemble the furniture themselves)

• inventory management (ensure customers can always get the furniture they want)(understocked/overstocked)

• logistics (sourcing, storage, transportation, inventory)

• sustainability (how is ikea going to source its material to reduce its impact on the environment and society)

•