Case Study 8: Information Security Threats and Policies in Europe (pages 357-358)

CASE QUESTIONS


Question 1: What is a botnet?

Question 2: Describe some of the main points of the Digital Agenda of Europe.

Question 3: Explain how a cyber-attack can be carried out.

Question 4: Describe some of the weaknesses exploited by malware.


CASE ANSWERS


Question 1:

In the term "botnet" as used here, the "bot" is short for robot. A single bot is a software  program that can, when surreptitiously installed on a person's computer, execute certain specified commands. Botnet is a network of autonomous malicious software agent there are under the control of a bot commander. The network is created by installing malware that exploits the vulnerabilities of Web servers, operating systems, or application to take control of the infected computers.
 A botnet also refer to the collection of internet–connected programs in order to perform task. This can be as mundane as keeping control of an internet relay chat (IRC) channel, or it could be used to send spam email or participate in distributed denial-of-service attacks. The world botnet is a portmanteau of robot and network.

Question 2:

The main point of the Digital Agenda of Europe is to define the key role that information and communication technologies will play in 2020.The initiative calls of a single, open Europe digital market. Another goal is that broadband speed of 30Mbps be available to all European citizen by 2020 in term of security, the initiative is considering the implementation of measure to protect privacy and the establishment of a well-functioning network of CERT to  prevent cybercrime and respond effectively to cyber-attacks. The European Commission has  proposed a Digital Agenda. Its main objective is to develop a digital single market in order to generate smart, sustainable and inclusive growth in Europe.

The obstacles hindering the Digital Agenda are the:

•fragmented digital markets;

•lack of interoperability;

•rising cybercrime and risk of low trust in networks;

•lack of investment in networks;

•insufficient research and innovation efforts;

•lack of digital literacy and skills;

•missed opportunities in addressing societal challenges


Question 3:

From a simple individual ping commands and message flooding to more sophisticated distributed denial of service (DDoS) attacks. Hacking is coordinated by using a large number of compromised servers organized in a botnet distributed around the world. There are 3 basic parts to a cyber-attack: i.


  • Access: a method to get inside or gain access to a network or system ii.



  • Vulnerability: some part of the system that the attacker can take advantage of or manipulate iii.



  • Payload: the purpose of the attack, namely, what exactly is the target and how significant will the damage There are many other forms cyber-attacks may take.


Denial Of Service attack occurs when “an attacker attempts to prevent legitimate users from
accessing information or services.” This is typically accomplished when the attacker
overloads a system with requests to view information. This would be an example of a remote attack.

Spear phishing is another simple method by which an attack may gain access to a computer system or network. Once some information about a target is acquired, an email is sent  purporting to be from a legitimate company asking for information such as usernames and  passwords to banking websites or network logins.

Backdoors, or hooks, are placed inside a computer or network in order to create a vulnerability that can be exploited later on.

And tampering with basic electronics is a simple type of cyber-attack. It is also possible that such software or even hardware could be installed into electronics by the original manufacturer.

Question 4:

Malware, known as Stuxnet is a shorthand term that encompasses all types of malicious software. This includes viruses, worms, Trojan horses, spyware, and all other types of software that get put onto your computer without you knowing it. Malware may exploit weakness to initially infiltrate a system or to gain additional privileges on an already- compromised machine. The weaknesses may be exploiting automatically by malware authors creations or manually by attempt will be generically called attackers. Weaknesses fall into two broad categories, based on where the weakness lies. Technical weakness involves tricking people. The malware, hidden in shortcuts to executable programs (files with extension .ink) was executed automatically when the content of an infected USB drive was displayed. Employing this same technique, the worms were capable of installing other malware.

Data gathered later by other experts indicates that the worms was actually looking for some specific programmable Logic Controllers(PLC) devices used in a specific industrial plants. A fact that points to the possibility that malware was part of the sites infected with sabotage.

The significance that such a sophisticated treat represents to the industrial recourses in Europe and others parts of the world cannot be underestimated.
Read More

Case Study 7: Google, Apple, and Microsoft Struggle for Your Internet Experience (pages 315-317)

CASE QUESTIONS


Question 1: Compare the business models and areas of strength of Apple, Google, and Microsoft.

Question 2: Why is mobile computing so important to these three firms? Evaluate the mobile platform offerings of each firm?

Question 3: What is the significance of mobile application, app stores, and closed versus open app standards to the success or failure of mobile computing?

Question 4: Which company and business model do you think will prevail in this epic struggle? Explain your answer.

Question 5: What difference would it make to a business or to an individual consumer if Apple, Google, or Microsoft dominated the Internet experience?


CASE ANSWERS

Question 1:

Apple 
     It has the basis of creating a very strong hardware base for the internet future and thus logically they play their role in this battle by laying emphasis on the hardware that facilitates mobile computing. Apple has gone into the stance that applications, one of the major earners for tablet and phone manufacturers, should be device restricted. For example, one application should be unique to the brand of the device and should be allowed to function in another device from another separate brand. They even stopped Google in its plans to allow Google applications to work on Apple products. Thus by doing this Apple is trying to capitalize on their loyal customer base and create a Apple weds Apple scenario. Its business model focuses on centralized control of almost all aspects of its hardware and software. It believes smart-phones and tablets should have proprietary standards and be tightly controlled. It only allows apps from its App store that have been vetted by the company, to be loaded to its products. Apple has a very loyal user base that has steadily grown and most likely will stay with Apple products in the future.

Google
     Google is the believer in the concept that in the future the devices used to run the applications and other internet options should be a fraction of what they are being charged now and instead the revenues generated should be from the in-app advertisements. Google even bought AdMob, an application advertisements development company, to work on such a concept. This future, Google and Microsoft have tried their hand at going hardware friendly but they still do not put the same emphasis on the hardware as Apple. Its business model has always focused on the Internet and the Web. It began as one of many search engines. It quickly ran away from the pack with its copyrighted Page-Rank search algorithm which returns superior search results for Web users. It also has developed extensive online advertising services for businesses of all sizes. Google provides value to the user by using an inexpensive, flexible infrastructure to speed up Web searches and provide its users with a vast array of Web-based services and software tools.

Microsoft
     Microsoft has laid its bet on the operating system on which the mobile computing devices shall run. Microsoft also has announced plans to develop the hardware for mobile computing, something it has not done so far, and thus has entered into the field of both Google and Apple. By integrating the hardware and software deal Microsoft has actually change the dynamics of the whole market. And this can be problem some for Google and Apple as they shall have to change their own perspective and outlook towards the level of competition that they shall have to face in the coming years in mobile computing. : Its business model originally focused on the desktop computer running the Windows operating system and Office desktop productivity applications. The company and its products are staples for businesses and consumers looking to improve their productivity with computer-based tasks. While it is trying to expand its presence on the Internet, it still must try to keep customers bound to the desktop computer.


Question 2:

Mobile computing is basically doing the activities which involve internet without being fixed to a particular place. The importance of mobile computing for all the three mentioned firms which is Apple , Google and Microsoft as it is the future of the internet technology and for these firms to  flourish and expand they need to be very effective with mobile computing.

APPLE 

      The mobile platform that Apple provides with its products is “iOS” (Kevin K, 2012). This mobile platform is the closed platform that is it is applicable for apple products and only apple apps could work on this. Some of the remarkable features amongst them are:

• There is an option over which you can reply later on the calls which you can’t take immediately.
•  Integration with the facebook over which you can share all you iphone activities
•  There is a passbook app through which you can use you iphone as a credit card.
•  There is also an up-gradation of the apple maps app which is very impressive.

GOOGLE

      The mobile platform that Google provides is “Android”. This mobile platform is a universal platform or you can say it’s an open platform when compared to the mobile platform offered by Apple. The latest version provided by the Android software is the version 4.1 “jelly bean” (Android, 2012). Some of the notable features of this version are:
•   A simple screen swipe would provide you with search results related to Google.
•   The voice recognition tool in this version would rub offline.
•    Another of the new feature is GOOGLE NOW in which the preferences are chosen based on the data like the time location and personal history and over this the search results are provided.

MICROSOFT

      Microsoft is entering this market recently by launching the tablet named “Surface tablet”. The mobile platform that Microsoft is offering is the Windows Phone 8 (Kevin K, 2012). This operating system will be compatible with the laptops and the desktops.
Some of the unique features of this operating system are:
• Support dual core chips
• Support multiple screen resolution
• Provides advanced map technology
• Offers Passbook wallet.

Question 3:

Any computer software that performs specific tasks is called Applications (Bovee 2012, p 256). Apps greatly enrich the experience of using a mobile device, and without them, the predictions for the future of mobile Internet would not be nearly as bright. They can range from large business computer programs such as “Sun Systems” for processing large accounting problems to a simple program that can be used to order something as simple as a pizza, in today’s world applications have become a part and parcel of the day today.

Today’s mobile and tablet users are becoming more and more inclined towards a product which has more number of application than the other product option. Although it can be said that such a thing has happened because of the fact that the devices today have become so specified that a certain range of products shall have the same specs regardless of their make. This change can be determined as a major shift in the consumer psyche and even the big three have not underestimated this change.

The development of applications and software’s to match these expectations is a task that all the companies in the fray to be the leader in the mobile computing market, wither it be Apple, Google, Microsoft or any other new player, shall have to look into great detail and precision.

The importance of mobile applications can be justified on this basis itself that Google has based their future growth prediction on the very same. Mobile applications have such a great scope of growth in the future that they can one day eclipse the sales of the hardware part of mobile computing and form a major market themselves here players like Google and apple shall have tough competition even from small fray players if a common platform for application usage is formed, the very same reason why Apple is resisting Google’s repeated efforts for a common mobile platform.

According to experts (Kevin, Timothy et.al) mobile applications are even today a big part of the on the go access market. Finish mobile giant Nokia too has a say in the application future as it still has the lion’s share in the applications that are used in its mobile phones, which in spite of the recent drop are a very big number. Applications and app stores are also being viewed as a source of major entertainment by many users of mobile computing devices, with games like angry birds and temple run taking the market by storm it is very evident that applications and app stores are a thing for the future.

Lastly it can be said that although all three firms have great opportunity in the market which is still young and in its infancy, the first mover shall have very definitive advantage to take control of this veritable goldmine.

Question 4:

Google

  • The search engine giant has a lot of positives going for it rather than the negatives. The clear positives that can make it a winner are:
  • A well-established name is something which not a lot of players can boast of but Google is one of them, although Apple and Microsoft have chartered territories of their own but Google can fight them out both as an equal if not better.
  • The Company has entered into all the three basic markets of mobile computing including hardware, operating system and the application stores. Their hardware is something which a few competitors can best , however the Android operating system has taken the market by storm and the app store which comes with it is a mean bully in itself (Android 2012)
  • Google has also bet on of the most time relevant feature of the mobile computing market, the App store, and this is the biggest advantage which the Google business model gives it and makes it the prime contender for the number one position. With hundreds of applications already online and hundreds more in the development stage Google has started to take a sort of lead on the other players in the race to be number one. And this may not be decisive right now but with Google’s recent acquisition of application developers and their heavy R&D expenditure on the same, it is just a matter of time before it will take out companies like Apple and Microsoft. (Android 2012)
  • Although the Google bandwagon is on its way there are certain roadblocks that it can face that can halt its march and some of them are:
  • The Google brand is big but it still lacks the appeal of an Apple product and this many say is one of the most major difference between the two.
  • The Android system although perfected to a large extent still has a few errors in the new versions that can hamper the growth of the operating system and this where a competitor like Microsoft can prevail over the Company
  • Lastly it can be said that Google’s move towards a common mobile application platform can itself backfire and could increase competition from local app players which can affect the overall profitability from this step.
  • Thus it can be said that Google does have a lot of positives that can help it in the market and if it can take care of the negatives and maybe tweak the one platform stance, it can just pull ahead of Apple and Microsoft in this battle of the behemoths.
  • Lastly it can be said that although all three firms have great opportunity in the market which is still young and in its infancy, the first mover shall have very definitive advantage to take control of this veritable goldmine.
Thus it can be said that Google does have a lot of positives that can help it in the market and if it can take care of the negatives and maybe tweak the one platform stance, it can just pull ahead of Apple and Microsoft in this battle of the behemoths.


Question 5: 

Consumers would be forced to buy only one product and use only one service. They would create a monopoly and the positive would be they would create a standard. This would affect quality; prices would be as high as possible because they would have no competition. No competition means nobody could force a monopolist from the outside to improve products, diversify rang or products and lower price. Right now it is too early to tell who would dominate the internet experience but it is good to have competition than just one market leader. 

Right now Apple leads Google in the number of apps available to users. That gap is closing quickly thanks to Google’s improvements of the Android operating system and its encouragement to app developers. Open, non-proprietary systems historically have beat closed, proprietary systems because developers and users have a wider range of choices. Business managers must try to forecast which platform will provide the right choices for employees. Consumers must choose which platform will best fulfil their personal needs for the next two to three years. Switching costs play into both scenarios, not just in terms of phone purchases but the price of apps. Once a user purchases and adjusts to using a certain platform it’s difficult and expensive to switch to a whole different system.
Read More

Case Study 6: Lego: Embracing Change by Combining BI with a flexible Information System (pages 270-271)

CASE QUESTIONS


Question 1: Explain the role of the database in SAP's three-tier system.

Question 2: Why distributed architectures are flexible?

Question 3: Identify some of the business intelligence features included in SAP's business software suite?

Question 4: What are the main advantages and disadvantages of having multiple databases in a distributed architecture?


CASE ANSWERS



Question 1:

  • SAP’s business suite is based on a flexible three-tier client-server architecture that can easily be adapted to the new Service-Oriented Architecture (SOA) available in the latest versions of the software. 
  • In the first tier, a client interface-a browser-type graphical user interface (GUI) running on either a laptop, desktop, or mobile device-submits users’ requests to the application servers. The applications servers send the processed requests to the database system-receive and process clients’ requests to the database system-the third tier-which consists of one or more relational databases.
  • The main role of the database is as an information storage system. The relational database contains the tables that store data on LEGO’s products, daily operations, the supply chain, and thousands of employees. 
  • Using the SAP query tool, users are able to toggle and tabulate data and extract reports from the database.  Therefore the database’s role is also as a reports generator.


Question 2:

  • A distributed architecture system is a software system in which components located on networked computers communicate and coordinate their actions by passing messages. The components interact with each other in order to achieve a common goal.  Data may be stored in multiple computers, located in the same physical location; or may be dispersed over a network of interconnected computers.  A distributed database can reside on network servers on the Internet, on corporate intranets or extra nets, or on other company networks.
  • Because they store data across multiple computers, distributed databases can improve performance at end-user work sites by allowing transactions to be processed on many machines, instead of being limited to one. Users from different parts of the world may access the same data.  Therefore they are more flexible in terms of availability to users.
  • They also bank on an improved performance of the machines, as data is located near the site of greatest demand, and the database systems themselves are parallelized, allowing load on the databases to be balanced among servers. A high load on one module of the database won't affect other modules of the database in a distributed database.
  • They are also more flexible for purposes of expansion of the database and transparency, as the data can be monitored on site of the specific computers as the data is potentially stored within the departments they relate to.  There is local autonomy or site autonomy, where a department can control the data about them (as they are the ones familiar with it).
  • They are economically flexible and may cost less to create a network of smaller computers with the power of a single large computer.  Systems can be modified, added and removed from the distributed database without affecting other modules (systems).

Question 3:

  • Supply Chain Management (SCM)  :  Supply chain monitoring and analysis as well as forecasting, planning and inventory optimization.
  • Product Lifecycle Management (PLM) :  Enable managers to optimize development process and system.
  • Enterprise Resources Planning (ERP):  Include Human Capital Management (HCM) application for personnel administration and development.
  • They are also more flexible for purposes of expansion of the database and transparency, as the data can be monitored on site of the specific computers as the data is potentially stored within the departments they relate to.  There is local autonomy or site autonomy, where a department can control the data about them (as they are the ones familiar with it).
  • They are economically flexible and may cost less to create a network of smaller computers with the power of a single large computer.  Systems can be modified, added and removed from the distributed database without affecting other modules (systems).

Question 4:

Advantages
   

  1. Multiple database contains the tables that store data on product, daily operation, supply chain and thousands of employees.
  2. Managers can easily use the SAP query tool to obtain reports from the database because it does not require any technical skills.
  3. Distributed architecture enables authorized personnel to have direct access to database system from the company’s various location including in Europe, North America and Asia.


Disadvantages
   

  1. The additional overhead of these transactions can be a performance penalty when the total amount of data in the network is small. Users also see slower performance when accessing data that is not local. 
  2. Increased the use of database space. Every table must exist in every database. When the number of tables is very large, the amount of space used can be significant. Administrators must use database storage parameters to size tables and reduce database space consumption.
  3. Administrators must keep the schemes of all database synchronized and ensure that the network is configured to take optimal advantage of the distributed-database environment in term of availability and performance. Although database backups are more flexible in a distributed-database environment, multiple databases add complexity to the backup process.
Read More

Case Study 5: Salesforce.com: Cloud Services Go Mainstream (pages 233-235)

CASE QUESTIONS


Question 1: How does Salesforce.com use cloud computing?

Question 2: What are some of the challenges facing Salesforce as it continues its growth? How well will it be able to meet those challenges?

Question 3: What kinds of business could benefit from switching to Salesforce and why?

Question 4: What factors would you take into account in deciding whether to use Salesforce.com for your business?

Question 5: Could a company run its entire business using Salesforce.com. Force.com, and Apps Exchange? Explain your answer.


CASE ANSWERS

Question 1:

Cloud computing, also known as on-demand computing, eliminates the need for a business to make large up-front hardware and software investments and reduces the time to implement new programs.
Subscribers to Salesforce.com don’t have to purchase or maintain any hardware (able it personal computing devices) nor do they have to install any maintain any hardware (able it personal computing devices) nor do they have to install any special operating systems, database servers, or application servers.There are no operating systems, database servers, or application servers to install, no consultants and staff, and no expensive licensing and maintenance fees.Users access the Salesforce.com cloud through a standard Web browser or a mobile handheld device.The new Salesforce.com Web site places much more emphasis on cloud computing, grouping products into three types of clouds: the Sales Cloud, the Service Cloud, and the Custom Cloud. The sales and service clouds help businesses improve sales cloud, and the custom cloud. The custom cloud provides a venue for customers to develop their own applications for use within the broader Salesforce network.


Question 2:

Challenges :

  • Increased competition both from traditional industry leadersand new challengers hoping to    replicate Salesforce’s success
  • Expanding its business model into other areas
  • Ensuring the system is available 24/7 with no outages
  • Defending the system against security breeches


Salesforce is trying to provide additional functionality is through a partnership with Google and more specifically Google Apps.They combine its service with Gmail, Google Docs, GoogleTalk andGoogle Calendar to allowits customers to accomplish more tasks via the Web. By partnering with Apple, Salesforce.com can expand its applications to iPhone users who will have access to
their data anywhere any time. Salesforce has additionally partnered with Amazon to enable Force.com customers to tap into Amazon’s cloud computing services (Elastic Compute Cloud and Simple Storage Service) Amazon’s services would handle the “cloudburst computing” tasks of Force.com applications that require extra processing power or storage capacity.


Question 3:

Sales force gives company a single place to store all their information and can only be accessed by authorized employees. So almost any company can benefit most are:

  • Small to medium size businesses are most likely to benefit because of lower cost and their inability for in-house computing.
  • Businesses that are trying to increase the sophistication of their computing abilities could also benefit from using Salesforce.com application

Question 4:

Businesses should assess the costs and benefits for services, weighing all people organization and technology issues.


Question 5:

Yes, certain smaller enterprises can be run though salesforce.com and app Exchange because now app exchange has following application.
Read More

Case Study 4: When Radiation Therapy Kills (pages 187-189)

CASE QUESTIONS


Question 1: What concepts in the chapter are illustrated in this case? What ethical issues are raised by radiation technology?

Question 2: What management, organization and technology factors that was responsible for the problems detailed in this case?

Question 3: Do you feel any of the groups involved with this issues (hospital administrators, technicians, medical equipment and software manufactures) should accept the majority of the blame for these incidents?

Question 4: How would a central reporting agency that gathered data on radiation-related accidents help reduce the number of radiation therapy errors in the future?


CASE ANSWERS


Question 1:

The basic concepts covered: responsibility, accountability and liability. The ethical issues: Management failed to regulate the hospitals' overworked staff and for not having safety procedures in place to check their work and enough time to do so. The organization neglected to budget their tie and resources properly for training doctors and medical technicians. Absence of appropriate updates in software by equipment manufacturers is also one of the issues.


Question 2:

The factors that was responsible for the problems detailed in this case are:
In management it is the lack of training of staff (doctors, technicians and machine operators) and inadequate staffing. While in technology it is the software glitches.

Question 3:

There are 3 categories of errors this are errors caused by machinery complexity, errors caused by medical personnel that operate such machinery and hospital administration errors. The Medical machinery and software manufacturers claim that hospitals that provide with radiation treatment should be responsible for training their staff to correctly operate radiological equipment while the technicians claim that they are understaffed and overworked and that there are no procedures in place that would check accuracy of their work and the hospitals on the other hand, claim that manufacturers should be doing better job providing radiation equipment with fail-safe mechanisms. Therefore, I feel that the blame should go to State Government because they are the regulator and controller of groups involved in radiation therapy and they are the one who is majorly responsible for medical errors associated with radiological mistreatment.

Question 4:

The emerging issues are radiation, misadministration and deaths/near deaths. The data can be use to help standardize, monitor, train and instill a safety culture. Managers within the MIS utilize raw data, report techniques, consultation services and aid to change policy and procedures. Complying with federal & state reporting mandates R&D of unique techniques that reduces personnel time and related costs in processing data, personnel, including mid-level management, senior junior programmer analysts, provides 24-hour, 7-day support for communications network that will reap the benefits of technological change by building an economical, efficient, and salable and integrated computer system.
Read More

Case Study 1: The National Bank of Kuwait (pages 68-69)

CASE QUESTIONS


 Q1: How has NBK benefitted from the implementation of SHOROUQ?

Q2: The advantages and disadvantages of implementing the SHOROUQ system at NBK?
 
Q3: How do you think NBK’s business would have developed if it had not integrated SHOROUQ?
CASE ANSWERS


Q1:

The development of the new ERP(Enterprise resource planning) SHOUROUQ("sunrise" in Arabic) system in NBK, the company has been changed essentially. The new system was originally developed according to the group’s mission to establish a leadership position across the region. This is why an IT transformation project including a full revamp of the care system and associated decision support tools with more focus towards customer focus. SHOUROUQ can be updated easily and additional server capacity can be added without a great deal of maintenance. The system system was designed to integrate data from legacy systems (a legacy system is an old method, technology, computer system.) for data mining purposes. SHOUROUQ is more flexible and dynamic when dealing with different types of information and more products. Because of this new system, NBK was able to expand its market locally. This new system also helped the company to expand its business worldwide.

Q2:

    Advantages:


  • The old system has different information systems for every department. However, new system makes all departments close to each other and flow of information is easier.
  • The new system able to overcome many of the shortcomings of the old system, particularly the costs of maintenance.
  • The new system can easily upgrade, additional server capacity can be add without a great deal of maintenance.
  • This system ensures that data quality and high availability could be maintained.
  • This system enables effective business operations, decision-making and reporting.
  • Identifying the most profitable customer as well as potential customers more effectively.
  • Successfully meet the organization’s overall needs.
  • Efficient resource management and customer service.

  Disadvantages:


  • This system was costly to develop and establish.
  • To make this system come to reality or achieve the objectives, The National Bank of Kuwait invested too much time and money.

Q3:

If NBK had not integrated SHOROUQ,
 - It will unable to expand its market share, locally or globally.
 - It will unable to target their current and potential customer efficiently.

 - Slow speed of information flow between organization, employees and customers.
 - Management decisions to counteract market changes were slow and costly.
 - Maintenance cost of the data is high.

Moreover, NBK may choose to use others IT strategy, such as:
Core system changes, the building of an SOA-driven integration platform and the delivery of a BI system as part of a fluid information architecture.
A new Operational Data Store (ODS) is effectively a data warehouse that would consolidate data from across the enterprise and provide NBK with the ability to drive all of its enterprise BI and information requirements, and support all decisions out of one place.
SAP Business Objects software was also chosen to cover operational reporting as the vendor’s distribution and access were felt to be in line with the needs of the bank.
Read More

Case Study 2: Modernization of NTUC Income (pages 105-106)

NTUC Income (“Income”), one of Singapore’s largest insurers, has over 1.8 million policy holders with total assets of S$21.3 billion. The insurer employs about 3,400 insurance advisors and 1,200 office staff, with the majority located across an eight-branch network. On June 1, 2003, Income succeeded in the migration of its legacy insurance systems to a digital webbased system. The Herculean task required not only the upgrading of hardware and applications, it also required Income to streamline its decade-old business processes and IT practices. 
Until a few years ago, Income’s insurance processes were very tedious and paper-based. The entire insurance process started with customers meeting an agent, filling in forms and submitting documents. The agent would then submit the forms at branches, from where they were sent by couriers to the Office Services department. The collection schedule could introduce delays of two to three days. Office Services would log documents, sort them, and then send them to departments for underwriting. Proposals were allocated to underwriting staff, mostly at random. Accepted proposals were sent for printing at the Computer Services department and then redistributed. For storage, all original documents were packed and sent to warehouses where, over two to three days, a total of seven staff would log and store the documents. In all, paper policies comprising 45 million documents were stored in over 16,000 cartons at three warehouses. Whenever a document needed to be retrieved, it would take about two days to locate and ship it by courier. Refiling would again take about two days.
In 2002, despite periodic investments to upgrade the HP 3000 mainframe that hosted the core insurance applications as well as the accounting and management information systems, it still frequently broke down. When a system breakdown did occur, work had to be stopped while data was restored. Additionally, the HP 3000 backup system could only restore the data to the version from the previous day. This meant that backups had to be performed at the end of every day in a costly and tedious process, or the company would risk losing important data. In one of the hardware crashes, it took several months to recover the lost data. In all, the HP 3000 system experienced a total of three major hardware failures, resulting in a total of six days of complete downtime.
That was not enough. The COBOL programs that were developed in the early 1980s and maintained by Income’s in-house IT team also broke multiple times, halted the systems, and caused temporary interruptions. In addition, the IT team found developing new products in COBOL to be quite cumbersome and the time taken to launch new products ranged from a few weeks to months.
At the same time, transaction processing for policy underwriting was still a batch process and information was not available to agents and advisors in real-time. As a result, when staff processed a new customer application for motor insurance, they did not know if the applicant was an existing customer of Income, which led to the loss of opportunities for cross-product sales, as staff had to pass physical documents between each other and there was no means of viewing an up-to-date report on a customer’s history on demand. Furthermore, compatibility issues between the HP 3000 and employees’ notebooks caused ongoing problems, especially with a rise in telecommuting.
All this changed in June 2003, when Income switched to the Java based eBao LifeSystem from eBao Technology. The software comprised three subsystems - Policy Administration, Sales Management and Supplementary Resources — and fulfilled many of the company’s requirements, from customerorientated design to barcode technology capabilities, and the ability to support changes in business processes.
Implementation work started in September 2002 and the project was completed in nine months. By May 2003, all the customization, data migration of Income’s individual and group life insurance businesses and training were completed.
The new system was immediately operational on a high-availability platform. All applications resided on two or more servers, each connected by two or more communication lines, all of which were “load balanced.” This robust architecture minimized downtime occurrence due to hardware or operating system failures.
As part of eBao implementation, Income decided to replace its entire IT infrastructure with a more robust, scalable architecture. For example, all servicing branches were equipped with scanners; monitors were changed to 20 inches; PC RAM size was upgraded to 128 MB; and new hardware and software for application servers, database servers, web servers, and disk storage systems were installed. Furthermore, the LAN cables were replaced with faster cables, a fiber-optic backbone, and wireless capability.
In addition, Income also revamped its business continuity and disaster-recovery plans. A real-time hot backup disaster-recovery center was implemented, where the machines were always running and fully operational. Data was transmitted immediately on the fly from the primary datacenter to the backup machines’ data storage. In the event of the datacenter site becoming unavailable, the operations could be switched quickly to the disasterrecovery site without the need to rely on restoration of previous day data.
Moving to a paperless environment, however, was not easy. Income had to throw away all paper records, including legal paper documents. Under the new system, all documents were scanned and stored on “trusted” storage devices - secured, reliable digital vaults that enabled strict compliance with stringent statutory requirements. Income had to train employees who had been accustomed to working with paper to use the eBao system and change the way they worked.
As a result of adopting eBao Life System, about 500 office staff and 3,400 insurance advisors could access the system anytime, anywhere. Staff members who would telecommute enjoyed faster access to information, almost as fast as those who accessed the information in the office.
This allowed Income to view a summary of each customer over different products and business areas. As a result, cross-selling became easier, and customer service could be improved. Simplified workflows cut policy processing time and cost by half, and greatly reduced the time required to design and launch new products from months to days.
Additionally, the systems allowed for online support of customers, agents and brokers.

Sources: Melanie Liew, Computerworld, July 2004; “NTUC Income of Singapore Successfully Implemented eBaoTech Lifesystem,” ebaotech.com, accessed November 2008; Neerja Sethi & D G Allampallai, “NTUC Income of Singapore (A): Re-architecting Legacy Systems,” asiacase.com, October 2005

CASE STUDY QUESTIONS 
Q1. What were the problems faced by Income in this case? How were the problems resolved by the new digital system? 
Q2. What types of information systems and business processes were used by Income before migrating to the fully digital system? 


Q3. Describe the Information systems and IT infrastructure at Income after migrating to the fully digital system? 

Q4. What benefits did Income reap from the new system? 

Q5. How well is Income prepared for the future? Are the problems described in the case likely to be repeated? Case contributed by Neerja Sethi and Vijay Sethi, Nanyang Technological University.

CASE STUDY ANSWERS

Q1.

 Income had problems with how they process their insurance because it is very tedious and paper-based. List of problems faced by Income:
  • The way they do business costs them time, because it takes them more days to finish a certain request for insurance.
  • The money because they need to upgrade HP 3000 mainframe that frequently breaks. Usually hardware failure caused six days of complete downtime.
  • The space because all the forms were out into cartons and can occupy 3 warehouse.

The problem's were resolved in June 2003 when they switched to Java based eBao LifeSystem from eBao Technology. The software comprimise three subsystems these are the Policy Administration, Sales Management and Supplementary Resources which fulfilled many of the company's requirements, from customer orientated design to barcode technology capabilities, and the ability to support changes in business processes.

Q2. 

 Income used HP 3000 as mainframe and they also used COBOL programs in early 1980s. COBOL programs were also used which also encountered technical failures. At the same time, COBOL programs were very slow in developing new products for the company resulting to lost sale opportunities.

Q3. 

 According to James Kang, CIO of Income, the Java based eBao LifeSystem from eBaoTechnology is:
  • customer-centric design, seamless integration with imaging and barcode technology
  • production definition modules that support new products, new channels & changes in business process
  • applications resided on two or more communication lines, all of which were "loaded balanced" - Minimizing downtime occurrence

Q4. 

 The benefits of Income reap from the new system are:
  • Saving lots of time for restoration of previous day data.
  • Moving to a paperless environment
  • Faster accessing the systems anytime, anywhere
  • Having opportunities of cross-selling by a singlar view of every customer - accorss products & channels

Q5. 

 I think the Income seems to be well prepared for the future now. They have extensive systems felxibility now and they launch an new products directly via eBao system. Maybe this will help them to be still more competitive in the future. I think if they will constantly improve there systems and they will adopt to new technology I think problems like this will never be repeated again.
Read More
Subscribe to: Posts (Atom)