SBM4202 IS Strategy, Management & Acquisition

Asia Pacific International College Pty Ltd. Trading as Asia Pacific International College
55 Regent Street, Chippendale, Sydney 2008: 02-9318 8111
PRV12007; CRICOS 03048D
Approved: 13/02/2019, Version 1
Unit Code and Title: SBM4202 IS Strategy, Management & Acquisition
Assessment Overview

Assessment TaskWeightingDueLengthULO
Assessment 1: Quiz
In- class quiz to identify key content areas to
identify further support needs
10%Week 430 minsULO-3
Assessment 2: Case Study-1
Students need to answer the case study which is
relevant to Business information system.
20%Week 72000
Assessment 3: Case Study-2
Applied project based on a Case-Based Information
System and its ‘Value-Add’ within a Case Business
30%Week 92000
Assessment 4: Tutorial Participation and
This involves a continuous and ongoing
coursework across all 10 weeks, to assess
understanding of weekly topic and answer
10%Week 1,
2, 3, 4,
5, 6, 7,
8, 9, 10
Assessment 5: Report
Students need to select a topic within the area of
Business and IT and write a research report
which should include Abstract, Introduction,
Literature Review, Proposed Methodology and

Assessment Details
Page | 2
Asia Pacific International College Pty Ltd. Trading as Asia Pacific International College
55 Regent Street, Chippendale, Sydney 2008: 02-9318 8111
PRV12007; CRICOS 03048D
Approved: 13/02/2019, Version 1
Assessment 1: Quiz

Due date:Week 4
Word count / Time provided:30 minutes
Unit Learning Outcomes:ULO-3, ULO-4

Assessment Details:
This in-class quiz will assess your knowledge of key content areas (Week 1,2 & 3 content) and to
identify further support needs. For successful completion of the quiz, you are required to study the
material provided (lecture slides, tutorials, and reading materials), engage in the unit’s activities, and
in the discussion forums. The prescribed textbook is the main reference along with the
recommended reading material. By completing this assessment successfully, you will be able to
identify key aspects of information systems. This will help in achieving ULO3 and ULO4.
The quiz will be completed in class.
Marking Information: The quiz will be marked out of 100 and will be weighted 10% of the total
unit mark.
Assessment 2: Case Study-1

Due date:Week 7
Word count / Time provided:2000 words
Unit Learning Outcomes:ULO2, ULO3, ULO4, ULO5

Assessment Details:
Students need to read the following case study, relevant to IS and business strategies, and answer
the questions at the bottom.
Can Instacart Deliver?
The online grocery store Webvan was perhaps the most well-known flop of the dot-com boom. Its
2001 failure led many pundits and investors to concluded that the online grocery business model was
untenable. However, Webvan’s downfall was due mainly to pursuing a first-mover advantage strategy.
It paid more than $1 billion to build huge distribution warehouses, bought fleets of delivery trucks,
and invested heavily in marketing. Then it offered free deliveries on any size order, at virtually any
hour, at prices that trumped its brick-and-mortar competitors. This was not a formula for generating
In recent years other companies are testing the waters again for online grocery sales. FreshDirect in
New York City has succeeded by combining fresh local produce, organic and kosher items, and customprepared meals with standard grocery store fare. Established brick-and-mortar firms including Albert
Page | 3
Asia Pacific International College Pty Ltd. Trading as Asia Pacific International College
55 Regent Street, Chippendale, Sydney 2008: 02-9318 8111
PRV12007; CRICOS 03048D
Approved: 13/02/2019, Version 1
son’s, Safeway and (the online entity for both Stop & Shop and Giant) took over as pure
play online firms perished.
The newest entrant, Instacart bypasses the expenses of warehousing and transportation altogether
by using a legion of independent contractors and local food retailers. These personal shoppers receive
orders via the Instacart smartphone app, fill them from grocery store aisles, and use their own vehicles
to deliver them to customers’ doors. Like fellow “sharing economy” firm Uber, Instacart minimizes
labor costs by requiring its personal shoppers to pay for their own auto and health insurance and
Social Security contributions. Purportedly paid between $15 and $20 an hour, depending on how
quickly they can fill and deliver an order, most Instacart shoppers work part-time on flexible schedules.
Instacart co-founder and CEO Apoorva Mehta believes Instacart’s competitive advantage is two-fold.
First, customers are not limited to a single vendor and can combine items from multiple stores on one
order, so product selection is truly customized. (Instacart uses special software that can track
inventory across multiple supermarkets.) And since personal shoppers are on call around the clock,
customers have to neither order many hours in advance of delivery nor wait for a delivery window. In
fact, customers can have their grocery list filled and delivered in less than an hour!
Instacart’s app provides a detailed map of each local establishment including store aisle contents. The
customer’s grocery list, compiled using extensive drop-down menus either on the website or
in the app, is organized by merchant and aisle to provide maximum order fulfillment efficiency.
Inventory is tracked for all of Instacart-affiliated merchants. As a personal shopper skims an aisle,
bedecked in a bright green T-shirt flaunting the Insta-cart logo, items can be selected for different
orders placed at different times. The software can also plan delivery routes and predict future
customer orders.
iPhone users can connect to the Instacart app from Yummly, the largest recipe search engine in the
world, and have the ingredients delivered in time for dinner. Visitors to Food Network websites, with
more than half a million recipes, can browse recipes online and then click a button to add ingredients
they need to their Instacart shopping cart. The Instacart app is integrated with Google Now cards so
that Android users can place orders for either delivery or pickup using a token generated within the
Instacart’s core competencies thus dictate its target market: the price-insensitive, convenience shopper. At first, item prices were marked up (20 percent in one sampling) and a $3.99 delivery fee charged.
An Amazon Prime–like service called Instacart Express requires a certain volume of business and a $99
yearly fee in exchange for free delivery. One of Webvan’s big mistakes was pursuing a mass-market
strategy. It was never going to be able to turn a profit by providing quality and selection at rock-bottom
prices—with free delivery to boot. Instacart is instead catering to shoppers who are willing to pay a
premium to have both quality and selection.
By mid-2015 Instacart had 200 employees and 4,000 personal shoppers in New York, Los Angeles, San
Francisco, San Jose, Washington, DC, Chicago, Boston, Austin, Seattle, Philadelphia, Atlanta, Boul-der,
Denver, Houston, and Portland, Oregon. It continues to grow. Grocery purveyors, from large chains
such as Costco, BJ’s Wholesale Club, Safeway, Kroger, Super Fresh, Trader Joe’s, and Whole Foods to
local specialty shops such as Erewhon Organic Grocer & Café in LA, Marczyk Fine Foods in Denver, and
Green Zebra in Portland are now welcoming Insta-cart as a way to expand their customer bases ahead
of the full national rollout of Amazon subsidiary Amazon Fresh.
Page | 4
Asia Pacific International College Pty Ltd. Trading as Asia Pacific International College
55 Regent Street, Chippendale, Sydney 2008: 02-9318 8111
PRV12007; CRICOS 03048D
Approved: 13/02/2019, Version 1
While many analysts predict that matching the bargain basement prices of Amazon and Walmart is
unavoidable, Instacart is instead modifying its business model. Partnerships with Petco and Tomlinson’s Pet Supplies in Austin, Texas, hint of additional product areas on the horizon, while Mehta
speculates that expansion into general logistics is conceivable.
Many of Instacart’s grocery store partners now set their own prices, paying Instacart a cut of each
order. This has freed Instacart of the burden of mark-ups, protected it from the vagaries of variable
food prices, and provided a more stable profit structure. Retailers have been willing to pay Instacart
in the hope of gaining more business because Instacart enables a single store to serve people across
a larger geographic area. Affiliated retailers are reporting gains, although the numbers are small. Nilam
Ganenthiran, head of Business Development and Strategy, maintains that different types of
agreements have been reached, declining to specify whether partners are outsourcing their ecommerce to Instacart for a monthly fee or are charged per item purchased, per order placed, or per
customer serviced.
With national chains achieving just 1 to 2 percent margins on grocery delivery, the Instacart model of
layering labor on top of the existing grocery infra-structure is still unproven. According to a Wall Street
Journal analysis, an order of 15 common items such as frozen peas, milk, cereal, and fresh fruit costing
about $68 from a San Francisco Safeway store would produce a profit of only $1.50 for Instacart. If
the order were smaller by one 28- ounce jar of peanut butter, Instacart would break even, and a
smaller order could push it into the red. Without price concessions from participating merchants, can
Insta-cart attract enough customers? And maintain a pay scale that ensures the top-notch customer
service demanded by its target market? And still make a profit? And can retailers’ sales gains from
Instacart be sustained? Instacart may be a great idea, but it’s a very big bet.
1. Give a brief introduction about the company Instacart.
2. Analyze Instacart using the value chain and competitive forces models. What competitive
forces does the company have to deal with? What is its value proposition?
3. Explain how Instacart’s business model works. How does the company generate revenue?
4. What is the role of information technology in Instacart’s business model?
5. Is Instacart’s model for selling online groceries viable? Why or why not?
Marking Information: The case study 1 will be marked out of 100 and will be weighted 20% of the
total unit mark.

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