Problem Diagnosis

Vermont Teddy Bears had been founded in 1981 by John Sortino. The company had offered three separately managed brands, which include Calyx Flowers, Pajama Grams and Vermont Teddy Bear. In the year 2010, the new Chief Information Officer of the company, Bob Stetzel is hoping to modernize and replace a number of the existing systems and make new investments in some new applications.

The sales of the company are highly seasonal and the peak sales period for the company is in Christmas, Mother’s Day and Valentine’s Day. The company has currently survived a big economic downturn and many costly strategic missteps. Now the CEO of the company is looking to leverage the growth of the company by finding new sources of revenue for the company. On the other hand, the CIO of the company needs to set the priorities for the Information Technology of the company.

There are two choices for the CIO, the first is whether they should invest in a full featured Enterprise Resource Planning package or they should take other actions that can yield more quick and tangible results for the company. The IT alignment challenges need to be explored in a time when the industry has become highly competitive, rivalry has become intense and the resources have become constrained.

Case Analysis

We need to analyze the key elements of the business model and IT architecture of Vermont Teddy Bears and evaluate the current state of the alignment of IT architecture with the current and the planned business model for making recommendations for improving the IT alignment.

Description of Business Model of Vermont Teddy Bear (Q1)

John Sortino had founded Vermont Teddy Bears in the year 1981. The company operates with three brands that are Vermont Teddy Bears, Calyx Flowers and Pajama Grams. The company has served the gift delivery service that is based on the products within these three brands. All the orders placed for the gift deliveries are made through the four different delivery channels of the company, which includes web order, phone, mail and the retail stores of the company. Each of the channelsaresupported by different software.

Within the business model of the company, the customers first design their bears of choice by selecting the outfits and colors from a menu of different options. All the bears of the company are produced at the Shelburne Campus and the raw materials and the fabrics are procured from different suppliers around the world. Secondly, low cost pajamas are offered by Vermont Teddy Bears. Majority of the pajamas are sold through the mass merchandisers, department stores and the other outlets of the company,

Lastly, high-end floral arrangement is offered by the Calyx Flowers for the discerning customers of Vermont Teddy Bears that appreciate the long vase life. Direct purchases are made from the growers and shipment is done through UPS so that all the fresh flowers are provided with the most special care on their route. The target market of the Vermont Teddy Bear’s customers include people with ages 20 to 64 and especially men that want to buy gifts for their girlfriends or wives especially at the last moment.............

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