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Costco Case Scenarios

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Alternative 3 (Amazon servers)
Costco needs to have their information kept safe and secure. Arranging a partnership, with a third-party take care of their data will reduce the cost of employees, maintenance, warehouses, data corruption, and liability. Using a company server will allow Costco management to focus on other departments and areas that are a focus on achieving their mission statement and goals.
Pros
Reducing costs is every company’s priority. Reducing cost allows a greater profit margin, thus a greater profit. Using Amazon data servers allows Costco to reduce the number of the warehouse that is used to keep their data. This will reduce the overhead cost that relates to managing and processing data servers. For example, employees, …show more content…

Investors and shareholders won’t have to worry about any data breaches, leaked and malfunction data. Having the extra sense of security
Cons
As technology continues to advance, they will be new ways for hackers to leak data. Having Amazon data servers does not that all of the risks of a potential data breach is eliminated. There will always be a slim chance that Costco’s data might be breached.
Even though Costco is reducing overhead cost, in the long run, does not mean there won’t be cost transitioning to Amazon servers. There is conversion cost, for example, Canadian and United States currency. The initial startup cost will be costly since Costco will have to transfer terabits of data to Amazon and Amazon has to set up an independent database for Costco. Monthly leases for renting Amazon’s servers. Costco has to change their information system to implement the new data management system.
The value of time is important to any organization. Costco has to transfer the data to Amazon’s servers quickly and efficiently. Costco needs to have their data on their customers standing by since Costco has a membership card. Every time a customer makes a purchase, the data is stored on a server. Costco cannot do that if the data servers are operational. The transitional process between the two data servers has to be

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