Aviall

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Chapter 1 / Foundations of Information Systems in Business ● 37

REAL WORLD CASE 3

Aviall Inc.: From Failure to Success with Information Technology Of course, even with planning, some of the systems integration was more difficult than expected. One major reason was the sheer size of the project. The new combined system has to properly access and deal with customized pricing charts for 17,000 customers who receive various types of discounts, and it has to deal with an inventory of 380,000 different aerospace parts. The development of Aviall.com was one of the least expensive parts of the project, at a cost of about $3 million, Lacik says. But it provides big benefits. When customers order products on the Aviall website, it costs the company about 39 cents per order, compared with $9 per transaction if an Aviall employee takes the order over the phone. New supply chain functions are also possible, such as the ability for customers to transfer their orders from an Excel spreadsheet directly to the website. Customers can also receive price and availability information on aerospace parts in less than five seconds—a real-time feature that hadn’t been available before the BroadVision system was installed, Lacik says. The process also frees the company’s sales force from routine order taking and follow-up, thus allowing them to spend more time developing relationships with customers. What’s more, the website helps Aviall build relationships with suppliers by providing them with customer ordering data that enables them to better match production with demand. The website now generates $60 million of the company’s $800 million in annual revenue, or 7.5 percent, up from less than 2 percent a year ago. “Over the next three to five years, it could become more than 30 percent.” Lacik says.

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oseph Lacik, Jr., doesn’t try to measure the return on investment of his company’s e-business website. The fact that Dallas-based Aviall Inc. (www.aviall.com) was saved from financial...
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