Ipremier Company Case Analysis

INTRODUCION

The iPremier Company, based in Seattle, Washington, which was founded in 1994 by two students at Swarthmore College, is one of the very few e-commerce success stories. Since its beginning, iPremier has been able to position itself as one of the top two organizations in this business of selling luxury, rare, and vintage goods to high-end customers on the web through credit cards. According to the executives, iPremier’s sales and respective profits were growing rapidly, as well as their stock prices. iPremier had its initial public offering in late 1998. The company’s stock price had nearly tripled immediately after it went public. However, the company’s stock had fallen during NASDAQ bloodbath of 2000 but had eventually stabilized and climbed again. iPremier was one of the very few survivors in the Business-to-customer (B2C) segment.

The management team at iPremier was mix of talented young people. Recruitment process at iPremier was intense and focused on the well educated technical and business professionals with reputations for high performance. Employee’s compensation was tied up with their performance. The company stated its governing values in terms of “discipline, professionalism, commitment or delivering results and partnership for achieving profits”. The management was focused on delivering more and more features that would benefit customers and were ready to do whatever it takes to get the project done. Because employees had the idea that their compensation and future prospects with the company depended on executing the plan they were highly obsessed with the numbers.

It seems that iPremier was working with a well-developed business model and strategy. However, their approach towards IT security was not effective .iPremier had contracted with Qdata, an Internet hosting business. Qdata provided iPremier with most of their computer equipment and connectivity to the Internet. Qdata was not an industry leader and was selected because it was located close to iPremier’s company headquarters and had been serving iPremier throughout the course of its new and developing business. Qdata did provide basic floor space, power, connectivity, environmental control, and physical security, and offered some high-level management services such as monitoring of web sites for customers and Internet security services such as firewall protection. But had not been quick to invest in new technologies and also experienced problem in retaining employees.

On January 12, 2007, iPremier faced a major problem due to lack of IT security practice. The iPremier website was not accessible and under a possible attack for a period of about an hour and then resolved automatically. A denial-of-service (DoS) attack had occurred. Luckily, this was only a denial-of service attack, possibly launched by a script-kiddie. The attack could have been a lot worse. iPremier’s customers pay for their