You are a management consultant working for Franklin Absolom, the majority stockholder for a group of ten automobile distributorships. He has asked you to spend several days at Freeway For – a dealership that is not performing up to its potential. You are not to go “looking for trouble”; instead your assignment is to find ways to help management at the dealership take advantage of opportunities.
One day while you are talking with James Kahler, the sales manager for Freeway Ford, you realize that the dealership only uses transaction processing systems –it is not utilizing the full potential of the information it has gathered for managerial decision making. For example, Freeway Ford know the purchase date and owner of every car it sells but the dealership never contacts owners about routine maintenance. Freeway Ford knows that people who purchase a new car generally trade it in for another new car three to four years later but the dealership does not contact these previous customers.
Another opportunity comes from used car purchasing and sales. Every car has a vehicle identification number (VIN) and the dealership uses that to check for known problems with a car before it makes a purchase of a used car. A data bank of car insurance claims histories and major repair histories is kept on a set of CDs that is sent to the dealership each month. At the dealership, the VIN is entered into a personal computer that accesses the CDs. However, the dealership buys twenty-five to one hundred used cars a month from other locations. Sometimes the used car buyer is at an auction and does not have access to a computer. Sometimes the buyer is at an estate sale or other private sale. Currently these sales are made “blind”, without review of current VIN information because the buyer cannot get to a computer and use the CDs to check the car’s history.
You know that Freeway Ford collects data but the dealership is not processing the data to produce information. Also, the used car buyers’ lack of access to the VIN database could be costing the dealership thousands of dollars each month. You decide that your report to Absolom and Kahler should highlight these two opportunities.
ASSIGNMENT
1. In a brief summary (no more than two paragraphs) explain the difference between data and information as it applies to the data collected by Freeway Ford when it sells a car. What data should be processed into information at Freeway Ford?
2. How can the used car buyers access the VIN information when the buyer is not at the
Freeway Ford location?
3. How could you expand your suggestions to the entire enterprise of ten dealership?