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  • 1. STRATEGIC INFORMATION TECHNOLOGY MANAGEMENT MIS375 Unique#: 03720 SPRING 2009 VERSION: 1/17/2009 Instructor : Huseyin Tanriverdi, Associate Professor Class times : Tuesday / Thursday 12:30 – 2:00p.m Class location : UTC 4.102 Instructor’s Office : CBA 5.208 Phone : (512) 232-9164 Fax : (512) 471-0587 E-mail : Huseyin.Tanriverdi@mccombs.utexas.edu Office Hours : Tuesday 11am-12noon or by appointment Course objectives Strategic management of information technology (IT) is the capstone course of the undergraduate MIS program at McCombs Business School. The objective of this course is to empower students with skills and knowledge in using IT to create business value. The course provides foundations in the concepts of strategic management and information economics. The first part of the course views IT management as a strategic capability that enables and supports a firm’s competitive strategy. It discusses how firms could use IT to create business value in: (a) corporate strategies such as corporate diversification, multi-market competition, mergers, acquisitions, and divestitures; (b) business strategies such as cost leadership and product differentiation; (c) growth strategies such as organic growth and growth by acquisitions, and (d) globalization strategies such as global sourcing and delivery. The first part concludes by examining how firms could justify investments into IT resources, and how they could govern those IT resources to create agile organizations that are highly responsive to changing demands of competitive strategy. The second part of the course focuses on information economics. It examines how firms could compete on IT-enabled information products and platforms that are subject to network externalities, switching costs, and lock-in. Course delivery format The course is delivered through a participant-centered, discussion-based, active learning format in which students share control and share responsibility for learning. They actively analyze, discuss, think about and write about issues in assigned cases and articles. Course website : Hosted on the Blackboard system http://courses.utexas.edu/ . Login using your UT EID and select MIS375. Updates to this syllabus and other course materials will be posted on this website. Please log on to the site before each class to view the announcements. Textbook : Shapiro, C., and Varian, H.R. Information Rules: A Strategic Guide to the Network Economy Harvard Business School Press, Boston, MA, 1999. Cases : Harvard Business School Cases we will use in this class can be purchased at: http://harvardbusinessonline.hbsp.harvard.edu/relay.jhtml?name=cp&c=c27171 Discussion : Most of the articles we will discuss in this class are available through electronic articles databases in the UT Library. In the course outline below, follow the [Download] links and instructions to access the articles. Articles that are not available through the UT library will either be handed out in class or posted on the course website. Grading: Contributions to in-class discussions : 30% Case write-ups (4 cases) : 40% Project : 30% Total : 100% 1
  • 2. Contributions to in-class discussions (30%). This class uses a participant-centered, discussion- based, active learning format. Students are expected to read, analyze, and think about the issues in assigned articles and cases before coming to class. Advanced preparation for in-class discussions and active contribution during the discussions are critical success factors for earning in-class contribution credits. Instructor will assess contribution level of each student to discussions in each class session throughout the semester. The three lowest contribution scores will be dropped (inclusive of missed class sessions for which contribution score=0). The remaining ones will be used in the computation of the final contribution grade. Attendance per se does not earn credit toward contribution to in-class discussions. Out of class interactions with the instructor are welcome, but they do not earn in-class contribution credits. As the name implies, in-class contribution credit must be earned in class by contributing to discussions and learning processes of the entire class. Missing a class session for any reason other than a documented medical emergency means lost in-class contribution credits for that session. Since the three sessions with the lowest contribution scores will be excluded from the computation of the final contribution grade, missing up to three class sessions will not have a direct negative effect on final contribution grade. However, missed content in one session may reduce student’s contributions to subsequent class sessions as well because of the cumulative nature of the content covered throughout the semester. Thus, I recommend that you catch up with any missed content as soon as you can. Please consult the following note in your case packet for guidance on how to prepare for a case discussion: Hammond, J.S. "Learning by the Case Method," Harvard Business School Teaching Note #: 9-376-241. In evaluating your contribution to class learning, factors I view positively include: Being prepared to present analysis in each class Arriving before the start of class and staying until the end Questioning Listening actively and critically to the class discussion Responding Synthesizing or reconciling previous comments Disagreeing constructively Talking with appropriate frequency, i.e., neither dominating the conversation nor being too quiet A good sense of humor Factors I view negatively include: Being unprepared, passing on cold calls Lack of involvement, silence, detachment or disinterest Distracting others (e.g., by surfing the web, e-mailing, instant messaging, not turning off cell phones, etc.) Not listening actively Lack of empathy Dominating the conversation Leading the discussion into unrelated topics Spending undue amount of time on minor points Long, rambling comments Using a name card and sitting roughly in the same place each class will help instructor and other students better recognize your contributions. 2
  • 3. Case write-ups (40%): We will discuss a total of seven cases during the semester. You are required to submit write-ups for four of them. You can choose any four. If you submit more than four write ups, I will drop the ones with the lowest scores and count only the four that receive the highest scores. I encourage you to submit write-ups starting with the first case so that you can receive feedback as early as possible in the semester and use the subsequent case write-up opportunities for improving your write-up scores if necessary. Case write-ups are due at the beginning of class (12:30) on the day of the case discussion. Submissions after 12:30 will not be considered for any reason other than a documented medical emergency. The objectives of the case write-up requirement are to: (a) improve your analytical thinking and writing skills, (b) help you prepare for case discussions, and (c) maximize the value of the case discussions for the entire class. A set of questions will be posted on the class website about one week before the case discussion. I recommend starting with your preparations as early as you can. Your write-up should address the assigned questions based on the facts covered in the case, concepts discussed in class, and if they are not sufficient, your own research through other sources as well. Your write-up should answer just the assigned write up questions, in no more than three pages total. The format of the write up is as follows: memo format, 1.5 line spacing, 1" margins on all sides, 12 point font size. The criteria for evaluation of case write-ups include: your ability to distinguish central and tangential issues in the case and focus on the most relevant and important issues; the clarity of your decisions and recommendations to the managers in charge of the issues; the soundness of your analyses and justifications for your recommended courses of actions; presentation of analyses and evidence in support of your decisions and recommendations; application and integration of course concepts in addressing the issues raised in the case; adherence to format and length requirements; grammar, spelling, and punctuation. You may discuss the cases with each other. In fact, I encourage you to do so. But the write-up you submit must be your unique work. Copying or editing the work of another person is a violation of the honor code and it will be subject to scholastic dishonesty policy described below. Project (30%): The final requirement of the course is a project report. The project will conduct an industry analysis and develop a competitive strategy for a new start-up company trying to figure out how to survive, grow, and become profitable. It will also develop an IT strategy explaining how the company ought to use IT to support its competitive strategy. Students will form three-member project teams. If you already started-up a company or planning to do so in the future, you can conduct the industry analysis and develop the competitive strategy for your own company. If not, you can select a start-up company from an industry that you are most interested in. The following note could be a useful reference for your industry analysis: Rivkin, J.W., and Cullen, A. "Finding Information for Industry Analysis," Harvard Business School Teaching Note#: 708481 (http://harvardbusinessonline.hbsp.harvard.edu/relay.jhtml?name=itemdetail&id=708481). Details of project deliverables and deadlines will be posted in a “project guidelines” document on course website. Make-up and Drop Policy. The University does not permit make-ups except for documented medical emergencies. If the University policies allow, a student may withdraw/drop the course within the timeframes set by the University. Students who drop the course after the official withdraw/drop timeframe will receive a grade based on what they have earned in the course at that point in time. Scholastic Dishonesty Policy. The University defines academic dishonesty as cheating, plagiarism, unauthorized collaboration, falsifying academic records, and any act designed to avoid participating honestly in the learning process. Scholastic dishonesty also includes, but not limited to, providing false or misleading information to receive a postponement or an extension on an exam or other assignment, and submission of essentially the same written assignment for two different courses without the permission of faculty members. By enrolling in this class, you have agreed to observe all of the student responsibilities described in the University’s scholastic dishonesty policy. If the application of that Policy Statement to this class and its assignments is unclear in any way, please ask the instructor for clarification. Special Accommodations Policy. The University of Texas at Austin provides upon request appropriate academic accommodations for qualified students with disabilities. For more information, contact the Office of the Dean of Students at 471-6259, 471-4641 TTY. 3
  • 4. STRATEGIC INFORMATION TECHNOLOGY MANAGEMENT SPRING 2009 COURSE OUTLINE Where to find the assigned discussion articles and cases? (BB): Article to be posted on Blackboard prior to class session (E): Article available through an electronic database in the UT Library. Follow the [Download] links in the table below. If a “PDF” link appears on the page, download the PDF. If not, a “Find it @ UT” button will appear at the bottom of the page. Clicking on that button will take you to the journal website(s) from which the PDF can be accessed. (CP): These are electronic versions of Harvard Business School Cases that we will use. You can purchase them at: [http://harvardbusinessonline.hbsp.harvard.edu/relay.jhtml?name=cp&c=c27171] (T): These are chapters from our textbook. The textbook is available at Co-op: Shapiro, C., and Varian, H.R. Information Rules: A Strategic Guide to the Network Economy, Harvard Business School Press, Boston, MA, 1999. S# Day Date TOPIC Discussion article / case 1 T Jan20 INTRODUCTION TO THE COURSE Syllabus PART-I: HOW TO USE INFORMATION TECHNOLOGY TO ENABLE AND SUPPORT COMPETITIVE STRATEGY? WHAT IS COMPETITIVE STRATEGY? 2 TH Jan22 What is competitive strategy? (E) Porter, M.E. "What is strategy?" Harvard Business Review (74:6), Nov-Dec 1996, pp 61-&. [Download] (E) Collis, D.J., and Rukstad, M.G. "Can you say what your strategy is?" Harvard Business Review (86:4), Apr 2008, pp 82-+. [Download] 3 T Jan27 Which forces shape competitive strategy? (E) Porter, M.E. "The five competitive forces that shape strategy," Harvard Business Review (86:1), Jan 2008, pp 78-+. [Download] 4 TH Jan29 How does the Internet affect competitive (E) Porter, M.E. "Strategy and the Internet," Harvard Business Review forces? (79:3), Mar 2001, pp 62-+. [Download] 5 T Feb03 Corporate strategy (E) Campbell, A., Goold, M., and Alexander, M. "Corporate-Strategy - The Quest For Parenting Advantage," Harvard Business Review (73:2), Mar- Project Team & Topic Due Apr 1995, pp 120-132. [Download] (E) Collis, D.J., and Montgomery, C.A. "Competing on resources," Harvard Business Review (86:7-8), Jul-Aug 2008, pp 140-+. [Download] 6 TH Feb05 CASE DISCUSSION-1: Danaher (CP) Bharat N. Anand, David J. Collis, and Hood, S. "Danaher Corporation Corporation," Harvard Business School Case # 9-708-445. 4
  • 5. WHEN, HOW AND WHY DOES INFORMATION TECHNOLOGY SHAPE COMPETITIVE STRATEGY? 7 T Feb10 Hypercompetition and IT (BB) Devan, J., M. B. Klusas, & T. W. Ruefli, “The elusive goal of corporate outperformance”, The McKinsey Quarterly, April 2007. (E) McAfee, A., and Brynjolfsson, E. "Investing in the IT that makes a competitive difference," Harvard Business Review (86:7-8), Jul-Aug 2008, pp 98-+. [Download] 8 TH Feb12 When, how, and why does “IT” become an (BB) Houghton, R., Sawy, O.A.E., Gray, P., Donegan, C., and Joshi, A. asset that shapes competitive strategy and "Vigilant Information Systems for Managing Enterprises in Dynamic Supply requires strategic management? Chains, Real-Time Dashboards at Western Digital," MIS Quarterly Executive (3:1) 2004, pp 19-35. 9 T Feb17 Why is the alignment of business and IT (BB) Chan, Y.E. "Why Haven't We Mastered Alignment? The Importance strategies a source of competitive of the Informal Organization Structure," MIS Quarterly Executive (1:2) advantage? How to achieve business-IT 2002, pp 95-110. alignment? 10 TH Feb19 What roles does IT play in a firm’s (E) Khanna, T., and Palepu, K.G. "Emerging giants - Building world-class globalization strategy? companies in developing countries," Harvard Business Review (84:10), Oct 2006, pp 60-+. [Download] 11 T Feb24 CASE DISCUSSION-2: House of Tata: (CP) Tarun Khanna, Palepu, K.G., and Bullock, R.J. "House of Tata: Acquiring a Global Footprint Acquiring a Global Footprint," Harvard Business School Case #: 9-708- 446. HOW AND WHY DOES INFORMATION TECHNOLOGY ENABLE OR INHIBIT SUCCESSFUL IMPLEMENTATION OF COMPETITIVE STRATEGY? 12 TH Feb26 Why do the majority of corporate mergers, (E) Lovallo, D., Viguerie, P., Uhlaner, R., and Horn, J. "Deals without acquisitions, and divestitures fail? How can delusions," Harvard Business Review (85:12), Dec 2007, pp 92-+. IT contribute to successful implementation [Download] of those transactions? (BB) Caselet: HP-Compaq Merger Project proposal due (BB) Caselet: J.P. Morgan-Chase Manhattan Merger 13 T Mar03 How does IT foster business Innovation? (BB) Teo, T.S.H., Ranganathan, C., Srivastava, S.C., and Loo, J.W.K. "Fostering IT-enabled business innovation at YCH group," MIS Quarterly Executive (6:4) 2007, pp 211-223. (BB) Kohli, R. "Innovating to create IT-based new business opportunities at United Parcel Service," MIS Quarterly Executive (6:4) 2007, pp 199- 210. 5
  • 6. 14 TH Mar05 Competing on Analytics (E) Davenport, T.H. "Competing on analytics," Harvard Business Review (84:1), Jan 2006, pp 98-+. [Download] (E) Davenport, T.H., and Harris, J.G. "The dark side of customer analytics," Harvard Business Review (85:5), May 2007, pp 37-+. [Download] 15 T Mar10 CASE DISCUSSION-3: Royal DSM N.V.: (CP) Lynda M. Applegate, Edward Watson, and Vatz, M.E. "Royal DSM Information Technology Enabling N.V.: Information Technology Enabling Business Transformation," Harvard Business Transformation Business School Case #: 9-807-167. 16 TH Mar12 Why do most firms do well with either an (E) O'Reilly, C.A., and Tushman, M.L. "The ambidextrous organisation," exploration or an exploitation strategy, but Harvard Business Review (82:4), Apr 2004, pp 74-+. [Download] not both? (E) Merrifield, R., Calhoun, J., and Stevens, D. "The next revolution in Could IT enable an ambidextrous productivity," Harvard Business Review (86:6), Jun 2008, pp 72-+. organization? [Download] SPRING BREAK 17 T Mar24 What resources and capabilities does an IT (BB) McDonald, M.P. "The Enterprise Capability Organization: A Future for function need to serve a firm? IT," MIS Quarterly Executive (6:3) 2007, pp 179-192. 18 TH Mar26 CASE DISCUSSION-4: Arctic Timber (CP) Michael Tushman, David Kiron, and Smith, W. "Arctic Timber AB: AB: Engineered Woods Division (A) Engineered Woods Division (A)," Harvard Business School Case #: 405067. 19 T Mar31 Governing IT for superior risk/return (E) Nolan, R., and McFarlan, F.W. "Information technology and the board of directors," Harvard Business Review (83:10), Oct 2005, pp 96- +.[Download] (BB) Huff, S.L., Maher, M., and Munro, M.C. "Information Technology and the Board of Directors: Is There An IT Attention Deficit?" MIS Quarterly Executive (5:2) 2006, pp 55-68. PART-II: HOW TO COMPETE ON INFORMATION PRODUCTS AND SERVICES? 20 TH Apr02 Pricing information: How do (T) Shapiro, C., and Varian, H.R. "The Information Economy," in: information/knowledge products differ Information Rules: A Strategic Guide to the Network Economy, Harvard from physical products? How to price Business School Press, Boston, MA, 1999a, pp. 1-18. information products for superior (T) Shapiro, C., and Varian, H.R. "Pricing Information," in: Information performance? Rules: A Strategic Guide to the Network Economy, Harvard Business School Press, Boston, MA, 1999e, pp. 19-51. 21 T Apr07 Versioning information (T) Shapiro, C., and Varian, H.R. "Versioning Information," in: Information Rules: A Strategic Guide to the Network Economy, Harvard Project status report due Business School Press, Boston, MA, 1999h, pp. 53-81. 22 TH Apr09 CASE DISCUSSION-5: Atlantic (CP) Bharadwaj, N., and Gordon, J.B. "Atlantic Computer: A Bundle of Computer, A Bundle of Pricing Options Pricing Options," Harvard Business School Case #: 2078. 6
  • 7. 23 T Apr14 Managing lock-in: How to lock-in (T) Shapiro, C., and Varian, H.R. "Recognizing lock-in," in: Information customers and lock-out competitors? Rules: A Strategic Guide to the Network Economy, Harvard Business School Press, Boston, MA, 1999f, pp. 103-134. (T) Shapiro, C., and Varian, H.R. "Managing lock-in," in: Information Rules: A Strategic Guide to the Network Economy, Harvard Business School Press, Boston, MA, 1999c, pp. 135-171. 24 TH Apr16 Network externalities: How to compete (T) Shapiro, C., and Varian, H.R. "Networks and Positive Feedback," in: in markets characterized by network Information Rules: A Strategic Guide to the Network Economy, Harvard externalities, switching costs, and lock-in? Business School Press, Boston, MA, 1999d, pp. 173-225. 25 T Apr21 CASE discussion-6: Satellite Radio: An (CP) Al-Najjar, N., Desai, D., and Hallaway, S. "Satellite Radio: An Industry Case Study Industry Case Study," Harvard Business School Case #: KEL2003. 26 TH Apr23 Intellectual property management: (T) Shapiro, C., and Varian, H.R. "Rights Management," in: Information How to create intellectual property and Rules: A Strategic Guide to the Network Economy, Harvard Business also profit from it? School Press, Boston, MA, 1999g, pp. 83-102. (BB) Review Evan Brown case: “Who owns Evan Brown’s Brain?” Available at: http://www.unixguru.com/ 27 T Apr28 Platforms: How to compete on platforms? (E) Gawer, A., and Cusumano, M.A. "How companies become platform leaders," MIT Sloan Management Review (49:2), Win 2008, pp 28- +.[Download] (E) Iyer, B., and Davenport, T.H. "Reverse engineering Google's innovation machine," Harvard Business Review (86:4), Apr 2008, pp 58- +. [Download] 28 TH Apr30 CASE DISCUSSION-7: Facebook (CP) Eisenmann, T., and Feinstein, B. "Facebook Platform," Harvard Platform Business School Case #: 9-808-128. 29 T May05 Synthesis & conclusion: Opportunities & (E) Carr, N.G. "IT doesn't matter," Harvard Business Review (81:5), May challenges entailed in the strategic 2003, pp 41-+. [Download] management of information technology Course/instructor surveys 30 TH May07 No class: finalize projects Final project report due by 5:00pm Peer evaluations due by 11:59pm 7