A small food retail chain was created twenty years ago. At that time, stock management and point of sale (POS) software was developed and maintained by an internal IT team. Today the chain is using…

Question

Options

• ACommoditization of service components
• BOrganization-specific requirements for service functionality
• CCustomer demand for personalized products
• DService components lacking mass-market adoption

• A
  77% (36)
• B
  9% (4)
• C
  2% (1)
• D
  13% (6)

Explanation

Commoditization occurs when a capability that once required custom development becomes widely available as a standardized, off-the-shelf product. Twenty years ago, the chain needed an internal IT team to build bespoke software because no suitable commercial solution existed - the functionality was specialized. Today, stock management and POS software is a mainstream commodity that any retailer can purchase, which is exactly what the chain did.

B is wrong because organization-specific requirements would explain why a company continues using custom software - the opposite of this scenario. The chain moved away from custom software, suggesting their needs align with standard market offerings.

C is wrong because customer demand for personalized products refers to what end-consumers want from the chain's retail offerings, not to how the chain manages its internal IT systems.

D is wrong because the existence of commercial off-the-shelf software proves mass-market adoption has already occurred - that's precisely what makes it available to buy.

Memory tip: Think of electricity - factories once built their own generators, but once power grids emerged, they plugged in like everyone else. When custom IT becomes "plug-in" software you can buy off a shelf, that's commoditization.

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