Otis Case Study
Otis Case Study
Background
Otis Elevator Company has been a worldwide industry leader in manufacturing, installation and maintenance of elevators, escalators and moving walkways, for more than 15 years (Otis, 2012). Elisha Graves Otis founded the company in 1853 (McFarlan & Delacey, 2005), and it became a subsidiary of United Technologies Corporation (UTC) in 1976 (Otis, 2012). UTC is “a leading provider to the aerospace and building system industries worldwide” (McFarlan & Delacey, 2005), and Otis is a part of its Building & Industrial Systems unit (Otis, n.d.). Otis consists of approximately 60,000 employees across 11 facilities spread out over the globe, with its “products offered in more than 200 countries and territories” (McFarlan & Delacey, 2005). It has “approximately 2.5 million elevators and escalators in operation worldwide” (McFarlan & Delacey, 2005), with service contracts for more than 1.8 million. As of 2011, these products and contracts contributed to an annual revenue of US $12.4 billion (Otis, n.d.).
Ari Bousbib joined Otis in 2000 as executive vice president and chief operating officer, and in 2002, he was elected president of Otis (McFarlan & Delacey, 2005). Despite the company’s exceptional performance and growth during 2000 to 2004, he realised that he needed to carefully optimize the Information System (IS) of the organisation for future progress in the competitive market. Due to slow building cycles in developed countries, and also its rivals, new-unit sales were quite stable. And therefore, service was estimated to account for up to 75% of Otis’s revenues. Whereas, in emerging economies like China, revenues were being generated mostly from new sales (McFarlan & Delacey, 2005).
OTISLINE
In the 1980s, Otis embarked a huge project of installing a 24 x 7 “centralised customer service system” (McFarlan & Delacey, 2005) called OTISLINE. Technology was not as advanced as today, and the company’s processes at the time relied on individual regional
Background
Otis Elevator Company has been a worldwide industry leader in manufacturing, installation and maintenance of elevators, escalators and moving walkways, for more than 15 years (Otis, 2012). Elisha Graves Otis founded the company in 1853 (McFarlan & Delacey, 2005), and it became a subsidiary of United Technologies Corporation (UTC) in 1976 (Otis, 2012). UTC is “a leading provider to the aerospace and building system industries worldwide” (McFarlan & Delacey, 2005), and Otis is a part of its Building & Industrial Systems unit (Otis, n.d.). Otis consists of approximately 60,000 employees across 11 facilities spread out over the globe, with its “products offered in more than 200 countries and territories” (McFarlan & Delacey, 2005). It has “approximately 2.5 million elevators and escalators in operation worldwide” (McFarlan & Delacey, 2005), with service contracts for more than 1.8 million. As of 2011, these products and contracts contributed to an annual revenue of US $12.4 billion (Otis, n.d.).
Ari Bousbib joined Otis in 2000 as executive vice president and chief operating officer, and in 2002, he was elected president of Otis (McFarlan & Delacey, 2005). Despite the company’s exceptional performance and growth during 2000 to 2004, he realised that he needed to carefully optimize the Information System (IS) of the organisation for future progress in the competitive market. Due to slow building cycles in developed countries, and also its rivals, new-unit sales were quite stable. And therefore, service was estimated to account for up to 75% of Otis’s revenues. Whereas, in emerging economies like China, revenues were being generated mostly from new sales (McFarlan & Delacey, 2005).
OTISLINE
In the 1980s, Otis embarked a huge project of installing a 24 x 7 “centralised customer service system” (McFarlan & Delacey, 2005) called OTISLINE. Technology was not as advanced as today, and the company’s processes at the time relied on individual regional
References: McFarlan, F. W., & Delacey, B.J. (2005). Otis Elevator: Accelerating Business Transformation with IT. Retrieved from https://autonline.aut.ac.nz/bbcswebdav/pid-3105107-dt-content-rid-4339914_4/institution/Papers/469907/Publish/Week_2_Otis_elevator%281%29.pdf. Meisner, M., Rath, M., Bray, B., & VanName, W. (2012). OTIS Elevator Case Study. Retrieved from https://www.scribd.com/doc/124054067/Otis-Case-Study. Otis. (2012). Otis Fact sheet. Retrieved from http://www.otisworldwide.com/pdf/otis_fact_sheet_2012_with_milestones.pdf. Otis (n.d). About Otis. Retrieved from http://www.otisworldwide.com/d1-about.html. Piccoli, G. (2007). Information system defined. Information Systems for Managers: Text and Cases (pp. 21 – 41). Wiley Publishing.