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In Lebanon, we kiss 3 times, we speak 3 languages :French English & Arabic, we have 3 colors on our National Flag... So 3 is our lucky number... So

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Monday, June 21, 2010

Casa del Libro

1. What would be your decision? Would you stick to the previously developed UNIX platform, or switch to the new Microsoft one? Please feel free to make any rational assumptions you might need in order to reach a decision.
2. Which are the most relevant criteria for you to make the decision? Just name each criterion, and explain it very briefly.


The new Millennium has been recognized as the internet boom. Hence the wave on which Planeta is surfing to acquire an online shopping facility is the right wave. From a competitive angle, the consumers were adopting more the trend of shopping in “one place” such as El Corte Ingles. For a fact, “El Corte Ingles” had almost all consumer needs in one store and had larger sales in the specific category of books. Redesigning the market, the sales trends and the location in the book category was vital for Planeta. It had more the face of a need than a normal expansion.

Out of experience, fears behind wars, terrorist attacks and natural disasters do not hang around for a long period, but they rather fade away after a short while, regardless if the conflicting situation is back to normal or continued. Consumers tend to forget and go back to their previous life activities.

Concerning the book category, fear from terrorism, wars and attacks could be an opportunity for book sellers, given that people will stay more at home, hence their need to read and have an indoor “safe” activity will increase. Therefore easing the sales, through online services would be the optimal solution. And once they get used to it, it would be hard to bring them back to the old trend.

An online sale is the best solutions. But how? Would it be through acquiring a rigid expensive system to secure large sales as of day one with a high maintenance cost or with a more flexible one, whose development and maintenance will be cheaper and the system itself is cheaper?

Taking a look at what have been already spent, it would be tough to acquire a new one. An expensive yet faulty and inadaptable system was already purchased including some mistakes in design. Therefore bold decisions should be made. CEO’s are not here to take easy decisions or to present a rosy figure. Therefore opting for the acquisition of a new system, cheaper in absolute terms, but most importantly cheaper to maintain and less rigid to develop, will be the right decision.

The market will not shift overnight to online sales. Educating the consumer about it will take time and creating a substantial market will take a bit more especially that Casadellibro.com is hitting at the beginning. However, continuous adaptation and development of a system will make it easier for the company to move along with the consumer and embrace his behavior and “movements” in order to ease the process rather than to make it rigid. A flexible and a low cost system are required. Demand and sales will increase at a later stage; ability to follow the consumer is a must and not the other way around.

Therefore, on the long term, it is definitely cheaper, taking into consideration criteria such as development, adaptation, low cost and easiness of the service.
Letting down the first option and moving to Microsoft; although will incur a new cost; is the most appropriate solution given the context. It is good money for bad money. Investments are not necessarily always done right, and can’t always be winning. The purchase of the first model is an example. It should be taken as an investment in learning rather than an investment in information system.

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