Alexander ShustaISM 158, Winter ‘04Sun Microsystems – Analysis Paper Presentation Outline.Thesis: Sun has excellent use of Information Technology. But, they’re hampered by poor businessprocesses.Issues to be discussed: Use of Information Technology to garner competitive advantage: Ex. Sun on Sun ONE, using Sun IT as a test-bed for new products. Business Processes: Ex. Strategy fluctuations, inconsistent customer interface. Leadership: Scott McNealy – Good cheerleader, a true believer in Sun. Culture: Directly influenced by leadership. Attempts to maintain the company’s agility.Presentation Outline:A. Industry definition and overview – Enterprise level computer and accessory manufacturers. 1. These are manufacturers that are capable of working as a single source for a large enterprises’ computing needs. They offer ‘end to end’ solutions including desktops, servers, networking gear, storage, infrastructure management software, and consulting services to help customers define their needs and choose a solution.2. Major players in the industry – IBM, Sun, Hewlett Packard, Dell and Microsoft.3. Typical industry strategy – From chart.4. Industry Porter Analysis – From chart.Conclusions: Intra-industry competition is the #1 source of pressure. Commodification of IT related technologies is eroding margins.5. Industry Revenues for the past five years – From chart.B. Sun Microsystems1. Leadership – McNealy. The last of the original founders left. His leadership style emphasizes company vision, technological advantages, and ignores boring things like accounting.2. Culture of Sun – Value is placed on innovation and technological solutions. There is a strong “not born here” attitude towards any outside technologies that has kept Sun from integrating other vendors’ solutions with their own. Ex. Java with Microsoft extensions and the resulting court case that spawned the C# programming language. 3. Use of Information Technology to gain competitive advantage. Ex. Sun on Sun ONE.Driven by a recognized need to improve business processes.Yielded process improvements like tighter integration with suppliers, better ability to forecast demand, ability to present a unified face to customers.Yielded cost improvements, examples from chart.4. Business Process Analysis –“It became very clear that we needed to pull the whole company, and all ofits systems, to a common base. We needed to have a better handle on our data. We needed to be able to provide Sun Services, our Global Sales Organization, as well as our finance departments with a more macro-level picture of what was going on with our customers at any point in time.”Business Strategy is a process like any other. When Sun waffles on their strategythey send the message that the process is out of control. They don’t always seem to know what customers want. Ex. Pushing Java cards since at least ’98. Doesn’t mean the tech is bad, just that it’s not what customers are asking for. Java in general, Sun never found a strategy to leverage Java for competitive advantage once all the marketing hoopla subsided.Changes that have been made to improve processes. Portals for Suppliers, Customers, and Sales Force.Intranet for developers and production managers to give real-time info.Sun Sigma program to implement Six Sigma controls on production processes.C. Conclusion.Sun has some great technology, they have an excellent use of Information Technology characterized by:An executive team that publicly supports IT initiatives.Strong employee buy-in of new systems (98% utilization rate for Sales Force Portal).Funding availability for new IT initiatives.Sun has had problems with business processes. They want to still be a start-up where things can be run without a bureaucracy. But they’ve made changes:Sun Sigma programNew N1 Services Procurement System runs on Solaris, Linux, Windows XP Server emphasizing open standards and compatibility.Acceptance of the value of other vendor’s technology. Ex. Partnership with AMD for new Opteron based
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