Ch12 - Organisation theory design and change gareth jones
Tradenet case
1. Singapore TradeNet Case Analysis Group No 2B Ankit Kesri (B10068) Ankur Maheshwari (B10070) Fasil Sagir (B10078) Karanbir Singh Satija (B10084) Megha Chaturvedi (B10088)
2. Singapore: Key facts Sustained economic growth during 1970s and 1980s On verge of becoming a developed nation Advantage due to geographic location (strategic port) Largest port in gross tonnage, 2nd largest in container handling globally Among top 20 trading nations in world
21. Selection(2/2) Selection of Vendors Based on size of operations carried out and experience in the domain Formation of Singapore Network Services(SNS) Purpose was to own and operate TradeNet Retention of original TradeNet committee members
22. Adoption Government Computerization Project: IT infrastructure already in place in various agencies Response exceeded Target 850 of 2200 subscribers joined by 1989 TradeNet made mandatory by 1991 Joining Costs: Connect Charge: US$375 – Transaction Cost: US$.25/kb of information Monthly Costs : US$15 – PC Cost +Software Cost: US$4000 Larger Firms – Joined Early Small and Medium Firms – Steps to increase Adoption Tax Write offs on purchase of Computer Hardware Facility of Service Centres Option of going to TDB offices Public Terminals in convenient offices: Assistance at modest fees
24. Structure Before TradeNet Freight Forwarders Air Cargo Agents Shipping Agents Traders Multiple Complex Connections CAAS TDB Customs PSA, Jurong Port Controlling Agencies
25. Structure After TradeNet Freight Forwarders Air Cargo Agents Shipping Agents Traders TradeNet CAAS Controlling Agencies PSA, Jurong Port TDB Customs
26. Risks Undertaken In Building TradeNet Technological Factors Lack of vendors with experience in EDI in the local environment Subcontracting of certain modules to local software house, CSA Lack of skilled manpower for the implementation Task Factors Tight deadlines for the implementation of TradeNet High involvement of government finances Market Factors Risk of rejection by the local trading community Organizational Factors No single government agency had the expertise to implement TradeNet
28. Time targets Target time announced in Dec 1986 was 2 years 1st transaction in Jan 1989; all components in place by June 1989 Institution of Engineering Change Procedure(ECP) and postponement of enhanced capabilities Involvement of SNS engineers throughout development phase Fast decisions by SNS management
29. System Performance Turnaround time for a transaction reduced from 1-4 days to 15 minutes Low cost of transactions – around the same as paid by traders before Tradenet SNS was able to breakeven in the 2nd year of its operations, 3 years earlier than anticipated
30. User Adoption 850 out of 2200 subscribers within 1st year handling 45% of all trade transactions; target was 15% of all transactions Most of the larger firms had joined by the end of 1989 Overwhelming success prompted TDB to phase out paper-based transaction by early 1991
31. Organizational Impact Better utilization of resources by companies Savings of 25%-30% in handling trade documentation by freight companies Larger firms were able to integrate their internal systems with Tradenet thus making them more efficient and competitive Govt agencies like Customs improved their performance and compliance
32. Critical Success Factors Commitment at Highest level Minister of Trade & Industry Trade Development Board Multi-agency Steering Committee Establishment of a corporate entity (SNS) Concurrent development of IT infrastructure Experienced technical service provider IBM Establishment of Document Service Centers