Case #1
“Electronic Commerce at Air Products”
Harvard Business School Case: #9-399-035 (August 19, 1998)
There is no Teaching Note available for this case at the
publisher’s website (http://www.hbsp.harvard.edu).
ABSTRACT
Air Products and Chemicals Inc., located in Allentown,
Pennsylvania, is a major US chemical company specializing in gas
products (e.g., air, oxygen, nitrogen, argon, hydrogen and
TEACHING OBJECTIVES
The teaching objective this case is to demonstrate the
importance of strategic planning for companies involved in the
application of new technologies. Air Products and Chemicals (APCI)
achieved some success in using its Intranet systems to promote
SUGGESTED QUESTIONS FOR CLASSROOM DISCUSSION
1. Review the web presence of APCI.
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ANALYSIS
1. Review the web presence of APCI.
In 1998, APCI was quite active in preparing its IT
infrastructure to move from an internally focused communications
structure to an externally oriented one that linked with
2. How was APCI involved in the use of the Internet and Extranet?
Facilitated by the advancement of Word Wide Web in 1993, APCI
built its first web site on January 8, 1996. The outcome was very
encouraging: (a) it registered 2000 hits and 170 visitors per day
A. Intranet – The Intranet, brought into being by APCI, was
oriented towards employees. It shared information regarding
benefits, training, employee directories, procedure manuals,
B. Extranet – APCI expanded its IT structure to enable an
Extranet system which included controlled access to its Intranet
as a supplement for purchasing invoices. It applied telemetry to
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3. What should APCI do now?
Strategic planning requires an understanding of the present as
well as a vision for the future. Joe McMaken, APCI Management
Information System VP, focused on (a) customer service, (b) cost
A. Coordinate E-commerce implementation policy.
There is an urgent need for APCI to survey the diverse
requirements of various business groups within the company and
B. Promote the wide usage of the web page.
After it is its properly designed, the company should
encourage various business groups within the company to use its
web page systematically: (a) Packaged Gases – have a standard
offering to small users; (b) Specialty gases – have vastly
different products for users with limited demands; (c) liquid
users – include both maps to show production sites near
The principal purposes of a web page are to (a) facilitate
communication by providing contact points and (b) cause customers
to want to do business with the company. It should employ the
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C. Customer Relations Management
APCI should progress from customer service to customer
relationship management. Tasks involved may include: (a)
profiling major customers according to the Pareto Principle (e.g.,
D. Supply Chain Management
APCI should take a broader view regarding the selection of and
teaming with suppliers. Tasks include: (a) forming partnerships
with equipment vendors for compressors, heat exchangers, vessels,
control systems, and others to cut lead time; (b) establishing an
E. Enterprise Integration
Invest in middleware or other suitable Enterprise Resource
Planning (ERP) software tools which could link the existing
F. Procurement Management
For the procurement of maintenance, repairs, and operations
(MRO) parts and supplies (e.g., office supplies, travel services,
G Recruitment
APCI should use the web page to attract needed talents.